Document and Entity Information (USD $)

In Billions, except Share data, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Feb. 17, 2017

Jun. 30, 2016

Dec. 31, 2015

Entity Registrant Name

SUNTRUST BANKS INC

Entity Central Index Key

0000750556

Current Fiscal Year End Date

--12-31

Entity Filer Category

Large Accelerated Filer

Document Type

10-K

Document Period End Date

Dec. 31, 2016

Entity Public Float

$ 20.6

Document Fiscal Year Focus

2016

Document Fiscal Period Focus

FY

Amendment Flag

false

Entity Common Stock, Shares Outstanding

491,412,870

Entity Well-known Seasoned Issuer

Yes

Entity Voluntary Filers

No

Entity Current Reporting Status

Yes

Common Stock, Par or Stated Value Per Share

$ 1.00

Consolidated Statements of Income (USD $)

In Millions, except Share data in Thousands, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Dec. 31, 2015

Dec. 31, 2014

Interest Income

Interest and fees on loans

$ 4,939

$ 4,506

$ 4,617

Interest and fees on loans held for sale

92

82

78

Interest and Dividend Income, Securities, Available-for-sale

651

593

613

Trading account interest and other

96

84

76

Total interest income

5,778

5,265

5,384

Interest Expense

Interest on deposits

259

219

235

Interest Expense, Long-term Debt

260

252

270

Interest on other borrowings

38

30

39

Total interest expense

557

501

544

Net, interest income

5,221

4,764

4,840

Provision for Loan, Lease, and Other Losses

444 ¹

165 ¹

342 ¹

Interest Income (Expense), after Provision for Loan Loss

4,777

4,599

4,498

Noninterest Income

Service charges on deposit accounts

630

622

645

Fees and Commissions, Other

380

377

368

Fees and Commissions, Credit and Debit Cards

327

329

320

Investment Banking Revenue

494

461

404

Trading Gain (Loss)

211

181

182

Fees and Commissions, Fiduciary and Trust Activities

304

334

423

Investment Advisory, Management and Administrative Fees

281

300

297

Fees and Commissions, Mortgage Banking

366

270

201

Servicing Fees, Net

(189)

(169)

(196)

Gain (Loss) on Disposition of Business

0

105

Gain (Loss) on Sale of Securities, Net

4

21

(15)

Noninterest Income, Other Operating Income

197

204

197

Total noninterest income

3,383

3,268

3,323

Noninterest Expense

Employee compensation

2,698

2,576

Other Labor-related Expenses

373

366

386

Outside processing and software

834

815

741

Net occupancy expense

349

341

340

Equipment Expense

170

164

169

Marketing and Advertising Expense

172

151

134

Federal Deposit Insurance Corporation Premium Expense

173

139

142

Operating losses

108

56

441

Professional Fees

93

73

71

Credit and collection services

66

71

91

Amortization

49

40

25

Other Noninterest Expense

383

368

427

Noninterest Expense

5,468

5,160

5,543

Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest

2,692

2,707

2,278

Income Tax Expense (Benefit)

805

764

493

Net Income (Loss), Including Portion Attributable to Noncontrolling Interest

1,887

1,943

1,785

Net Income (Loss) Attributable to Noncontrolling Interest

9

10

11

Net Income (Loss) Attributable to Parent

1,878

1,933

1,774

Net Income (Loss) Available to Common Stockholders, Basic

$ 1,811

$ 1,863

$ 1,722

Weighted Average Number of Shares Outstanding, Basic

498,638

514,844

527,500

Weighted Average Number of Shares Outstanding, Diluted

503,466

520,586

533,391

Common Stock, Dividends, Per Share, Declared

$ 1.00

$ 0.92

$ 0.70

Earnings Per Share, Basic

$ 3.63

$ 3.62

$ 3.26

Earnings Per Share, Diluted

$ 3.60

$ 3.58

$ 3.23

[1] Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.

Consolidated Statements of Comprehensive Income Consolidated Statement of Comprehensive Income (USD $)

In Millions, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Dec. 31, 2015

Dec. 31, 2014

Statement of Comprehensive Income [Abstract]

Net Income (Loss) Attributable to Parent

$ 1,878

$ 1,933

$ 1,774

Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax

(197)

(163)

375

Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax

(244)

(10)

(182)

Other Comprehensive Income (Loss), Brokered Time Deposits, Net of Tax

(1)

0

Other Comprehensive Income (Loss), Long Term Debt, Adjustment, Net of Tax

(2)¹

0

Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax

88

(165)

(26)

Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent

(356)

(338)

167

Comprehensive Income (Loss), Net of Tax, Attributable to Parent

$ 1,522

$ 1,595

$ 1,941

Consolidated Statements of Comprehensive Income Consolidated Statement of Comprehensive Income (Parenthetical) (USD $)

In Millions, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Dec. 31, 2015

Dec. 31, 2014

Statement of Comprehensive Income [Abstract]

Other Comprehensive Income (Loss), Available-for-sale Securities, Tax

$ (117)

$ (93)

$ 218

Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Tax

(145)

(5)

(106)

Other Comprehensive Income (Loss), Brokered Time Deposits, Tax

0

Credit Risk Adjustment, Tax

(1)

0

Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net Unamortized Gain (Loss) Arising During Period, Tax

$ 52

$ (103)

$ (15)

Consolidated Balance Sheets (USD $)

In Millions, except Share data, unless otherwise specified

Dec. 31, 2016

Dec. 31, 2015

Assets

Cash and Due from Banks

$ 5,091

$ 4,299

Federal Funds Sold and Securities Purchased under Agreements to Resell

1,307

1,277

Interest-bearing Deposits in Banks and Other Financial Institutions

25

23

Cash and cash equivalents

6,423

5,599

Trading assets

6,067 ¹

6,119 ¹

Available-for-sale Securities

30,672

27,825

Loans Held for Sale

4,169 ²

1,838 ²

Loans held for investment

143,298 ³

136,442 ³

Loans and Leases Receivable, Allowance

(1,709)

(1,752)

Net loans

141,589

134,690

Property, Plant and Equipment, Net

1,556

1,502

Goodwill

6,337

Intangible Assets, Net (Excluding Goodwill)

1,657

1,325

Other Assets

6,405

5,582

Total assets

204,875

190,817

Liabilities and Shareholders' Equity

Noninterest-bearing consumer and commercial deposits

43,431

42,272

Interest-bearing Deposit Liabilities

116,967

107,558

Total deposits

160,398

149,830

Funds purchased

2,116

1,949

Securities Sold under Agreements to Repurchase

1,633

1,654

Other Short-term Borrowings

1,015

1,024

Long-term Debt

11,748 ⁴

8,462 ⁴

Trading liabilities

1,351

1,263

Other Liabilities

2,996

3,198

Total liabilities

181,257

167,380

Preferred Stock, Value, Outstanding

1,225

Common Stock, Value, Outstanding

550

Additional Paid in Capital

9,010

9,094

Retained earnings

16,000

14,686

Treasury stock, at cost, and other

(2,346)⁵

(1,658)⁵

Accumulated Other Comprehensive Income (Loss), Net of Tax

(821)

(460)

Total shareholders' equity

23,618

23,437

Liabilities and Equity

204,875

190,817

Common Stock, Shares, Outstanding

491,188,000 ⁶

508,712,000 ⁶

Common shares authorized

750,000,000

Preferred Stock, Shares Outstanding

12,000

Preferred Stock, Shares Authorized

50,000,000

Treasury shares of common stock

58,738,000

41,209,000

Treasury Stock and Other

Liabilities and Shareholders' Equity

Treasury stock, at cost, and other

(2,448)

(1,764)

Total shareholders' equity

(2,346)⁷

(1,658)⁷

Stockholders' Equity Attributable to Noncontrolling Interest

103

108

Variable Interest Entity, Primary Beneficiary [Member]

Assets

Loans held for investment

211

246

Liabilities and Shareholders' Equity

Long-term Debt

222

259

Restricted Stock [Member]

Liabilities and Shareholders' Equity

Common Stock, Shares, Outstanding

11,000

1,334,000

Trading Securities [Member]

Liabilities and Shareholders' Equity

Pledged Assets Separately Reported, Securities Pledged as Collateral, at Fair Value

$ 1,437

$ 1,377

[1] Includes trading securities pledged as collateral where counterparties have the right to sell or repledge the collateral of $1,437 million and $1,377 million at December 31, 2016 and December 31, 2015, respectively.

[2] Includes $3.5 billion and $1.5 billion of LHFS measured at fair value at December 31, 2016 and 2015, respectively.

[3] Includes loans of consolidated VIEs of $211 million and $246 million at December 31, 2016 and December 31, 2015, respectively.

[4] Includes debt of consolidated VIEs of $222 million and $259 million at December 31, 2016 and December 31, 2015, respectively.

[5] Includes noncontrolling interest of $103 million and $108 million at December 31, 2016 and December 31, 2015, respectively.

[6] Includes restricted shares of 11 thousand and 1,334 thousand at December 31, 2016 and December 31, 2015, respectively.

[7] At December 31, 2016, includes ($2,448) million for treasury stock, ($1) million for the compensation element of restricted stock, and $103 million for noncontrolling interest.At December 31, 2015, includes ($1,764) million for treasury stock, ($2) million for the compensation element of restricted stock, and $108 million for noncontrolling interest.

Consolidated Balance Sheets (Parenthetical) (Brokered Time Deposits [Member], USD $)

In Millions, except Share data in Thousands, unless otherwise specified

Dec. 31, 2016

Dec. 31, 2015

Deposits, Fair Value Disclosure

$ 78

$ 0

Consolidated Statements of Shareholders' Equity (USD $)

In Millions, except Share data, unless otherwise specified

Total

Preferred Stock [Member]

Common Stock [Member]

Additional Paid-in Capital [Member]

Retained Earnings [Member]

Treasury Stock and Other

AOCI Attributable to Parent [Member]

Total shareholders' equity at Dec. 31, 2013

$ 21,422

$ 725

$ 550

$ 9,115

$ 11,936

$ (615)¹

$ (289)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Common Stock, Shares, Outstanding

525,000,000

Net Income (Loss) Attributable to Parent

1,774

Other Comprehensive Income (Loss), Net of Tax

167

Noncontrolling Interest, Period Increase (Decrease)

5

5 ¹

Dividends, Common Stock, Cash

(371)

Dividends, Preferred Stock, Cash²

(42)

Stock Issued During Period, Value, New Issues

(496)

(500)

(4)

Treasury Stock, Shares, Acquired

(12,000,000)

Treasury Stock, Value, Acquired, Cost Method

(458)

(458)¹

Payments for Repurchase of Warrants

0

Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period

1,000,000

Stock Issued During Period, Value, Stock Options Exercised

(4)

(16)

(20)¹

Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures

0

Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures

17

18

(2)

1 ¹

Adjustments to Additional Paid in Capital, Share-based Compensation, Restricted Stock Unit or Restricted Stock Award, Requisite Service Period Recognition

27

27 ¹

Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value

(39)

23

16 ¹

Stock Issued During Period, Value, Employee Benefit Plan

3

(1)

4 ¹

Total shareholders' equity at Dec. 31, 2014

23,005

1,225

550

9,089

13,295

(1,032)¹

(122)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Common Stock, Shares, Outstanding

508,712,000 ³

509,000,000

Net Income (Loss) Attributable to Parent

1,933

Other Comprehensive Income (Loss), Net of Tax

(338)

Dividends, Common Stock, Cash

(475)

Dividends, Preferred Stock, Cash²

(64)

Treasury Stock, Shares, Acquired

(17,000,000)

Treasury Stock, Value, Acquired, Cost Method

(679)

(679)¹

Payments for Repurchase of Warrants

0

Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period

1,000,000

Stock Issued During Period, Value, Stock Options Exercised

(12)

(18)

(30)¹

Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures

0

Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures

24

23

(3)

4 ¹

Adjustments to Additional Paid in Capital, Share-based Compensation, Restricted Stock Unit or Restricted Stock Award, Requisite Service Period Recognition

16

16 ¹

Stock Issued During Period, Value, Employee Benefit Plan

3

0

3 ¹

Total shareholders' equity at Dec. 31, 2015

23,437

1,225

550

9,094

14,686

(1,658)¹

(460)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Common Stock, Shares, Outstanding

491,188,000 ³

491,000,000

Cumulative effect of credit risk adjustment⁵

0

5

(5)⁴

Net Income (Loss) Attributable to Parent

1,878

Other Comprehensive Income (Loss), Net of Tax

(356)

Noncontrolling Interest, Period Increase (Decrease)

(5)

(5)¹

Dividends, Common Stock, Cash

(498)

Dividends, Preferred Stock, Cash²

(66)

Treasury Stock, Shares, Acquired

(20,000,000)

Treasury Stock, Value, Acquired, Cost Method

(806)

(806)¹

Payments for Repurchase of Warrants

(24)

Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period

1,000,000

Stock Issued During Period, Value, Stock Options Exercised

(25)⁶

(40)⁶

(65)¹

Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures

1,000,000

Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures

31 ⁶

(20)⁶

(5)

56 ¹

Adjustments to Additional Paid in Capital, Share-based Compensation, Restricted Stock Unit or Restricted Stock Award, Requisite Service Period Recognition

2

2 ¹

Total shareholders' equity at Dec. 31, 2016

$ 23,618

$ 1,225

$ 550

$ 9,010

$ 16,000

$ (2,346)¹

$ (821)

[1] At December 31, 2016, includes ($2,448) million for treasury stock, ($1) million for the compensation element of restricted stock, and $103 million for noncontrolling interest.At December 31, 2015, includes ($1,764) million for treasury stock, ($2) million for the compensation element of restricted stock, and $108 million for noncontrolling interest.

[2] For the year ended December 31, 2016, dividends were $4,067 per share for both Perpetual Preferred Stock Series A and B, $5,875 per share for Perpetual Preferred Stock Series E, and $5,625 per share for Perpetual Preferred Stock Series F.For the year ended December 31, 2015, dividends were $4,056 per share for both Perpetual Preferred Stock Series A and B, $5,875 per share for Perpetual Preferred Stock Series E, and $6,219 per share for Perpetual Preferred Stock Series F.

[3] Includes restricted shares of 11 thousand and 1,334 thousand at December 31, 2016 and December 31, 2015, respectively.

[6] Includes a ($4) million net reclassification of excess tax benefits from additional paid-in capital to provision for income taxes, related to the Company's early adoption of ASU 2016-09. See Note 1, "Significant Accounting Policies," and Note 15, "Employee Benefit Plans," for additional information.

Consolidated Statements of Shareholders' Equity (Parenthetical) (Series F Preferred Stock [Member] Additional Paid-in Capital [Member], USD $)

In Millions, except Per Share data, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Dec. 31, 2015

Preferred Stock, Dividends, Per Share, Cash Paid

$ 5,625

$ 6,219

Consolidated Statements of Cash Flows (USD $)

In Millions, unless otherwise specified

12 Months Ended

Dec. 31, 2016

Dec. 31, 2015

Dec. 31, 2014

Cash Flows from Operating Activities:

Net Cash Provided by (Used in) Operating Activities, Continuing Operations

$ (681)

$ 3,552

$ (1,160)

Net Income (Loss), Including Portion Attributable to Noncontrolling Interest

1,887

1,943

1,785

Adjustments to reconcile net income/(loss) to net cash provided by operating activities:

Gain (Loss) on Disposition of Business

0

(105)

Depreciation, Amortization and Accretion, Net

725

786

693

Payments to Acquire Mortgage Servicing Rights (MSR)

(312)

(238)

(178)

Provisions For Credit Losses And Foreclosed Properties

449

176

364

Deferred Income Tax Expense (Benefit)

111

21

99

Stock Option Compensation And Amortization Of Restricted Stock Compensation

126

89

67

Gain (Loss) on Sale of Securities, Net

(4)

(21)

15

Gain (Loss) on Sale of Loans and Leases

(428)

(323)

(343)

Net decrease/(increase) in loans held for sale

(1,819)

1,625

(1,567)

Increase (Decrease) in Trading Securities

(342)

67

(1,529)

Net (increase)/decrease in other assets

(800)¹

(407)¹

(45)¹

Increase (Decrease) in Other Operating Liabilities

(274)¹

(166)¹

(416)¹

Cash Flows from Investing Activities:

Net Cash Provided by (Used in) Investing Activities, Continuing Operations

(11,157)

(5,316)

(9,273)

Proceeds from Maturities, Prepayments and Calls of Available-for-sale Securities

5,108

5,680

4,707

Proceeds from sales of securities available for sale

197

2,708

2,470

Purchases of securities available for sale

(8,610)

(9,882)

(11,039)

Proceeds from sales of auction rate securities

0

59

Proceeds from (payments for) Originations and Purchases of Loans Held-for-investment

(9,032)

(5,897)

(9,843)

Proceeds from sales of loans

1,612

2,127

4,090

Payments for (Proceeds from) Mortgage Servicing Rights

(171)

(117)

(130)

Capital expenditures

(283)

(186)

(147)

Payments related to acquisitions, including contingent consideration

(211)

(30)

(11)

Proceeds from Divestiture of Businesses

0

193

Proceeds from Sale of Other Real Estate

233

281

378

Cash Flows from Financing Activities:

Net Cash Provided by (Used in) Financing Activities, Continuing Operations

12,662

(866)

13,399

Net (decrease)/increase in total deposits

10,568

9,263

10,808

Net increase/(decrease) in funds purchased, securities sold under agreements to repurchase, and other short-term borrowings

37

(4,559)

447

Proceeds from Issuance of Long-term Debt

6,705

1,351

2,574

Repayment of long-term debt

(3,231)

(5,684)

(53)

Proceeds from Issuance of Preferred Stock and Preference Stock

0

496

Payments for Repurchase of Common Stock

(806)

(679)

(458)

Payments for Repurchase of Warrants

(24)

0

Common and preferred dividends paid

(564)

(539)

(409)

Proceeds from the exercise of stock options

25 ¹

17 ¹

10 ¹

Payments Related to Tax Withholding for Share-based Compensation

(48)¹

(36)¹

(16)¹

Cash and Cash Equivalents, Period Increase (Decrease)

824

(2,630)

2,966

Cash and cash equivalents

5,599

8,229

5,263

Cash and cash equivalents

6,423

5,599

8,229

Supplemental Disclosures:

Transfer of Loans Held-for-sale to Portfolio Loans

30

741

44

Transfer of Portfolio Loans and Leases to Held-for-sale

360

1,790

3,280

Transfer to Other Real Estate

59

67

148

Non-cash impact of debt acquired by purchaser in leverage lease sale

74

190

177

Amortization Of Deferred Gain On Sale Lease Back Of Premises

43

54

53

Interest Paid

559

523

534

Income Taxes Paid

813

497

380

Proceeds from Income Tax Refunds

(2)

(1)

(219)

non-cash impact of deconsolidated assets

$ 0

$ 282

Significant Accounting Policies

Significant Accounting Policies [Text Block]

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES

General

SunTrust, one of the nation's largest commercial banking organizations, is a financial services holding company with its headquarters in Atlanta, Georgia. Through its principal subsidiary, SunTrust Bank, the Company offers a full line of financial services for consumers, businesses, corporations, and institutions, both through its branches (located primarily within Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia, and the District of Columbia) and through other national delivery channels. In addition to deposit, credit, mortgage banking, and trust and investment services provided by the Bank, other subsidiaries of the Company provide asset and wealth management, securities brokerage, and capital market services. SunTrust provides clients with a selection of technology-based banking channels, including the internet, mobile, ATMs, and telebanking. SunTrust operated under the following business segments during 2016: Consumer Banking and Private Wealth Management, Wholesale Banking, and Mortgage Banking, with functional activities included in Corporate Other. For additional information on the Company’s business segments, see Note 20, “Business Segment Reporting.”

Principles of Consolidation and Basis of Presentation

The Consolidated Financial Statements have been prepared in accordance with U.S. GAAP and include the accounts of the Company and its subsidiaries after elimination of significant intercompany accounts and transactions. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the results of operations in these financial statements, have been made.

The Company holds VIs, which are contractual, ownership or other interests that change with changes in the fair value of a VIE's net assets. The Company consolidates a VIE if it is the primary beneficiary, which is the party that has both the power to direct the activities that most significantly impact the financial performance of the VIE and the obligation to absorb losses or rights to receive benefits through its VIs that could potentially be significant to the VIE. To determine whether or not a VI held by the Company could potentially be significant to the VIE, both qualitative and quantitative factors regarding the nature, size, and form of the Company's involvement with the VIE are considered. The assessment of whether or not the Company is the primary beneficiary of a VIE is performed on an ongoing basis. The Company consolidates VOEs that are controlled through the Company's equity interests or by other means.

Investments in entities for which the Company has the ability to exercise significant influence, but not control, over operating and financing decisions are accounted for using the equity method of accounting. These investments are included in other assets in the Consolidated Balance Sheets at cost, adjusted to reflect the Company's portion of income, loss, or dividends of the investee. Non marketable equity investments that do not meet the criteria to be accounted for under the equity method and that do not result in consolidation of the investee are accounted for under the cost method of accounting. Cost method investments are included in other assets in the Consolidated Balance Sheets and dividends received or receivable from these investments are included as a component of other noninterest income in the Consolidated Statements of Income.

Results of operations of acquired entities are included from the date of acquisition. Results of operations associated with entities or net assets sold are included through the date of disposition. The Company reports any noncontrolling interests in its subsidiaries in the equity section of the Consolidated Balance Sheets and separately presents the income or loss attributable to the noncontrolling interest of a consolidated subsidiary in its Consolidated Statements of Income.

Assets and liabilities of acquired entities are accounted for under the acquisition method of accounting, whereby the purchase price of an acquired entity is allocated to the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition. The excess of the purchase price over the amount allocated to the assets acquired and liabilities assumed is recorded as goodwill.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying Notes; actual results could vary from these estimates. Certain reclassifications have been made to prior period amounts to conform to the current period presentation.

The Company evaluated events that occurred between December 31, 2016 and the date the accompanying financial statements were issued, and there were no material events, other than those already discussed in this Form 10-K, that would require recognition in the Company's Consolidated Financial Statements or disclosure in the accompanying Notes.

Cash and Cash Equivalents

Cash and cash equivalents include cash and due from banks, interest-bearing deposits at other banks, Fed funds sold, and securities borrowed and purchased under agreements to resell. Cash and cash equivalents have maturities of three months or less, and accordingly, the carrying amount of these instruments is deemed to be a reasonable estimate of fair value.

Trading Activities and Securities AFS

Debt securities and marketable equity securities are classified at trade date as trading or securities AFS. Trading assets and liabilities are measured at fair value with changes in fair value recognized within noninterest income. Securities AFS are used as part of the overall asset and liability management process to optimize income and market performance over an entire interest rate cycle. Interest income and dividends on securities AFS are recognized in interest income on an accrual basis. Premiums and discounts on debt securities AFS are amortized or accreted as an adjustment to yield over the life of the security. The Company estimates principal prepayments on securities AFS for which prepayments are probable and the timing and amount of prepayments can be reasonably estimated. The estimates are informed by analyses of both historical prepayments and anticipated macroeconomic conditions, such as spot interest rates compared to implied forward interest rates. The estimate of prepayments for these debt securities impacts their lives and thereby the amortization or accretion of associated premiums and discounts. Securities AFS are measured at fair value with unrealized gains and losses, net of any tax effect, included in AOCI as a component of shareholders’ equity. Realized gains and losses, including OTTI, are determined using the specific identification method and are recognized as a component of noninterest income in the Consolidated Statements of Income.

Securities AFS are reviewed for OTTI on a quarterly basis. In determining whether OTTI exists for securities in an unrealized loss position, the Company assesses whether it has the intent to sell the security or, for debt securities, the Company assesses the likelihood of selling the security prior to the recovery of its amortized cost basis. If the Company intends to sell the debt security or it is more-likely-than-not that the Company will be required to sell the debt security prior to the recovery of its amortized cost basis, the debt security is written down to fair value, and the full amount of any impairment charge is recognized as a component of noninterest income in the Consolidated Statements of Income. If the Company does not intend to sell the debt security and it is more-likely-than-not that the Company will not be required to sell the debt security prior to recovery of its amortized cost basis, only the credit component of any impairment of a debt security is recognized as a component of noninterest income in the Consolidated Statements of Income, with the remaining impairment balance recorded in OCI.

The OTTI review for marketable equity securities includes an analysis of the facts and circumstances of each individual investment and focuses on the severity of loss, the length of time the fair value has been below cost, the expectation for that security's performance, the financial condition and near-term prospects of the issuer, and management's intent and ability to hold the security to recovery. A decline in value of an equity security that is considered to be other-than-temporary is recognized as a component of noninterest income in the Consolidated Statements of Income.

Nonmarketable equity securities are accounted for under the cost or equity method and are included in other assets in the Consolidated Balance Sheets. The Company reviews nonmarketable securities accounted for under the cost method on a quarterly basis, and reduces the asset value when declines in value are considered to be other-than-temporary. Equity method investments are recorded at cost, adjusted to reflect the Company’s portion of income, loss, or dividends of the investee. Realized income, realized losses, and estimated other-than-temporary losses on cost and equity method investments are recognized in noninterest income in the Consolidated Statements of Income.

For additional information on the Company’s securities activities, see Note 4, “Trading Assets and Liabilities and Derivatives,” and Note 5, “Securities Available for Sale.”

Loans Held for Sale

The Company’s LHFS generally includes certain residential mortgage loans, commercial loans, consumer indirect loans, and student loans. Loans are initially classified as LHFS when they are individually identified as being available for immediate sale and a formal plan exists to sell them. LHFS are recorded at either fair value, if elected, or the lower of cost or fair value. Any origination fees and costs for LHFS recorded at LOCOM are capitalized in the basis of the loan and are included in the calculation of realized gains and losses upon sale. Origination fees and costs are recognized in earnings at the time of origination for LHFS that are elected to be measured at fair value. Fair value is derived from observable current market prices, when available, and includes loan servicing value. When observable market prices are not available, the Company uses judgment and estimates fair value using internal models, in which the Company uses its best estimates of assumptions it believes would be used by market participants in estimating fair value. Adjustments to reflect unrealized gains and losses resulting from changes in fair value and realized gains and losses upon ultimate sale of the loans are classified as noninterest income in the Consolidated Statements of Income.

The Company may transfer certain loans to LHFS measured at LOCOM. At the time of transfer, any credit losses subject to charge-off in accordance with the Company's policy are recorded as a reduction in the ALLL. Any subsequent losses, including those related to interest rate or liquidity related valuation adjustments, are recorded as a component of noninterest income in the Consolidated Statements of Income. The Company may also transfer loans from LHFS to LHFI. If an LHFS for which fair value accounting was elected is transferred to held for investment, it will continue to be accounted for at fair value in the LHFI portfolio. For additional information on the Company’s LHFS activities, see Note 6, “Loans.”

Loans

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are considered LHFI. The Company’s loan balance is comprised of loans held in portfolio, including commercial loans, consumer loans, and residential loans. Interest income on loans, except those classified as nonaccrual, is accrued based upon the outstanding principal amounts using the effective yield method.

Commercial loans (C&I, CRE, and commercial construction) are considered to be past due when payment is not received from the borrower by the contractually specified due date. The Company typically classifies commercial loans as nonaccrual when one of the following events occurs: (i) interest or principal has been past due 90 days or more, unless the loan is both well secured and in the process of collection; (ii) collection of contractual interest or principal is not anticipated; or (iii) income for the loan is recognized on a cash basis due to the deterioration in the financial condition of the debtor. When a loan is placed on nonaccrual, accrued interest is reversed against interest income. Interest income on commercial nonaccrual loans, if recognized, is recognized after the principal has been reduced to zero. If and when commercial borrowers demonstrate the ability to repay a loan classified as nonaccrual in accordance with its contractual terms, the loan may be returned to accrual status upon meeting all regulatory, accounting, and internal policy requirements.

Consumer loans (guaranteed and private student loans, other direct, indirect, and credit card) are considered to be past due when payment is not received from the borrower by the contractually specified due date. Guaranteed student loans continue to accrue interest regardless of delinquency status because collection of principal and interest is reasonably assured. Other direct and indirect loans are typically placed on nonaccrual when payments have been past due for 90 days or more except when the borrower has declared bankruptcy, in which case, they are moved to nonaccrual status once they become 60 days past due. When a loan is placed on nonaccrual, accrued interest is reversed against interest income. Interest income on nonaccrual loans, if recognized, is recognized on a cash basis. Nonaccrual consumer loans are typically returned to accrual status once they are no longer past due.

Residential loans (guaranteed and nonguaranteed residential mortgages, residential home equity products, and residential construction) are considered to be past due when a monthly payment is due and unpaid for one month. Guaranteed residential mortgages continue to accrue interest regardless of delinquency status because collection of principal and interest is reasonably assured by the government. Nonguaranteed residential mortgages and residential construction loans are generally placed on nonaccrual when three payments are past due. Residential home equity products are generally placed on nonaccrual when payments are 90 days past due. The exceptions for nonguaranteed residential mortgages, residential construction loans, and residential home equity products are: (i) when the borrower has declared bankruptcy, in which case, they are moved to nonaccrual status once they become 60 days past due, (ii) loans discharged in Chapter 7 bankruptcy that have not been reaffirmed by the borrower, in which case, they are reclassified as TDRs and moved to nonaccrual status, and (iii) second lien loans, which are classified as nonaccrual when the first lien loan is classified as nonaccrual, even if the second lien loan is performing. When a loan is placed on nonaccrual, accrued interest is reversed against interest income. Interest income on nonaccrual residential loans is recognized on a cash basis. Nonaccrual residential loans are typically returned to accrual status once they no longer meet the delinquency threshold that resulted in them initially being moved to nonaccrual status, with the exception of the aforementioned Chapter 7 bankruptcy loans, which remain on nonaccrual until there is six months of payment performance following discharge by the bankruptcy court.

TDRs are loans in which the borrower is experiencing financial difficulty at the time of restructure and the borrower received an economic concession either from the Company or as the product of a bankruptcy court order. To date, the Company’s TDRs have been predominantly first and second lien residential mortgages and home equity lines of credit. Prior to granting a modification of a borrower’s loan terms, the Company performs an evaluation of the borrower’s financial condition and ability to service under the potential modified loan terms. The types of concessions generally granted are extensions of the loan maturity date and/or reductions in the original contractual interest rate. Typically, if a loan is accruing interest at the time of modification, the loan remains on accrual status and is subject to the Company’s charge-off and nonaccrual policies. See the “Allowance for Credit Losses” section below for further information regarding these policies. If a loan is on nonaccrual before it is determined to be a TDR then the loan remains on nonaccrual. Typically, TDRs may be returned to accrual status if there has been at least a six month sustained period of repayment performance by the borrower. Generally, once a loan becomes a TDR, the Company expects that the loan will continue to be reported as a TDR for its remaining life, even after returning to accruing status, unless the modified rates and terms at the time of modification were available to the borrower in the market or the loan is subsequently restructured with no concession to the borrower and the borrower is no longer in financial difficulty. Interest income recognition on impaired loans is dependent upon accrual status, TDR designation, and loan type as discussed above.

For loans accounted for at amortized cost, fees and incremental direct costs associated with the loan origination and pricing process, as well as premiums and discounts, are deferred and amortized as level yield adjustments over the respective loan terms. Fees received for providing loan commitments that result in funded loans are recognized over the term of the loan as an adjustment of the yield. If a loan is never funded, the commitment fee is recognized in noninterest income at the expiration of the commitment period. Any origination fees and costs are recognized in noninterest income and expense at the time of origination for newly-originated loans that are accounted for at fair value. For additional information on the Company's loans activities, see Note 6, “Loans.”

Allowance for Credit Losses

The allowance for credit losses is composed of the ALLL and the reserve for unfunded commitments. The Company’s ALLL reflects probable current inherent losses in the LHFI portfolio based on management’s evaluation of the size and current risk characteristics of the loan portfolio. The Company employs a variety of modeling and estimation techniques to measure credit risk and construct an appropriate and adequate ALLL. Quantitative and qualitative asset quality measures are considered in estimating the ALLL. Such evaluation considers a number of factors for each of the loan portfolio segments, including, but not limited to, net charge-off trends, internal risk ratings, changes in internal risk ratings, loss forecasts, collateral values, geographic location, delinquency rates, nonperforming and restructured loan status, origination channel, product mix, underwriting practices, industry conditions, and economic trends. Additionally, refreshed FICO scores are considered for consumer and residential loans and single name borrower concentration is considered for commercial loans. These credit quality factors are incorporated into various loss estimation models and analytical tools utilized in the ALLL process and/or are qualitatively considered in evaluating the overall reasonableness of the ALLL.

Large commercial (all loan classes) nonaccrual loans and certain consumer (other direct, indirect, and credit card), residential (nonguaranteed residential mortgages, residential home equity products, and residential construction), and certain commercial (all classes) loans whose terms have been modified in a TDR are reviewed to determine the amount of specific allowance required in accordance with applicable accounting guidance. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the agreement. If necessary, an allowance is established for these specifically evaluated impaired loans. The specific allowance established for these loans is based on a thorough analysis of the most probable source of repayment, including the present value of the loan’s expected future cash flows, the loan’s estimated market value, or the estimated fair value of the underlying collateral. Any change in the present value attributable to the passage of time is recognized through the provision for credit losses.

General allowances are established for loans and leases grouped into pools based on similar characteristics. In this process, general allowance factors are based on an analysis of historical charge-off experience, expected loss factors derived from the Company's internal risk rating process, portfolio trends, and regional and national economic conditions. Other adjustments may be made to the ALLL after an assessment of internal and external influences on credit quality that may not be fully reflected in the historical loss or risk rating data. These influences may include elements such as changes in credit underwriting, concentration risk, macroeconomic conditions, and/or recent observable asset quality trends.

The Company’s charge-off policy meets regulatory minimums. Commercial loans are charged off when they are considered uncollectible. Losses on unsecured consumer loans are generally recognized at 120 days past due, except for losses on credit cards, which are recognized when the loans are 180 days past due, and losses on guaranteed student loans, which are recognized when the loans are 270 days past due and payment from the guarantor is processed by the servicer. However, if the borrower is in bankruptcy, the loan is charged-off in the month the loan becomes 60 days past due. Losses, as appropriate, on secured consumer loans, including residential real estate, are typically recognized at 120 or 180 days past due, depending on the loan and collateral type, in compliance with the FFIEC guidelines. However, if the borrower is in bankruptcy, the secured asset is evaluated once the loan becomes 60 days past due. The loan value in excess of the secured asset value is written down or charged-off after the valuation occurs. Additionally, if a residential loan is discharged in Chapter 7 bankruptcy and not reaffirmed by the borrower, the Company's policy is to immediately charge-off the excess of the carrying amount over the fair value of the collateral.

The Company uses numerous sources of information when evaluating a property’s value. Estimated collateral valuations are based on appraisals, broker price opinions, recent sales of foreclosed properties, automated valuation models, other property-specific information, and relevant market information, supplemented by the Company’s internal property valuation analysis. The value estimate is based on an orderly disposition of the property, inclusive of marketing costs. In limited instances, the Company adjusts externally provided appraisals for justifiable and well-supported reasons, such as an appraiser not being aware of certain property-specific factors or recent sales information. Appraisals generally represent the “as is” value of the property but may be adjusted based on the intended disposition strategy of the property.

For commercial and CRE loans secured by property, an acceptable third party appraisal or other form of evaluation, as permitted by regulation, is obtained prior to the origination of the loan and upon a subsequent transaction involving a material change in terms. In addition, updated valuations may be obtained during the life of a loan, as appropriate, such as when a loan's performance materially deteriorates. In situations where an updated appraisal has not been received or a formal evaluation performed, the Company monitors factors that can positively or negatively impact property value, such as the date of the last valuation, the volatility of property values in specific markets, changes in the value of similar properties, and changes in the characteristics of individual properties. Changes in collateral value affect the ALLL through the risk rating or impaired loan evaluation process. Charge-offs are recognized when the amount of the loss is quantifiable and timing is known. The charge-off is measured based on the difference between the loan’s carrying value, including deferred fees, and the estimated realizable value of the property, net of estimated selling costs. When valuing a property for the purpose of determining a charge-off, a third party appraisal or an independently derived internal evaluation is generally employed.

For nonguaranteed mortgage loans secured by residential property where the Company is proceeding with a foreclosure action, a new valuation is obtained prior to the loan becoming 180 days past due and, if required, the loan is written down to its realizable value, net of estimated selling costs. In the event the Company decides not to proceed with a foreclosure action, the full balance of the loan is charged-off. If a loan remains in the foreclosure process for 12 months past the original charge-off, the Company obtains a new valuation annually. Any additional loss based on the new valuation is charged-off. At foreclosure, a new valuation is obtained and the loan is transferred to OREO at the new valuation less estimated selling costs; any loan balance in excess of the transfer value is charged-off. Estimated declines in value of the residential collateral between these formal evaluation events are captured in the ALLL based on changes in the house price index in the applicable metropolitan statistical area or other market information.

In addition to the ALLL, the Company also estimates probable losses related to unfunded lending commitments, such as letters of credit and binding unfunded loan commitments. Unfunded lending commitments are analyzed and segregated by risk based on the Company’s internal risk rating scale. These risk classifications, in combination with probability of commitment usage, existing economic conditions, and any other pertinent information, result in the estimation of the reserve for unfunded lending commitments. The reserve for unfunded lending commitments is reported on the Consolidated Balance Sheets in other liabilities and the provision associated with changes in the unfunded lending commitment reserve is recognized in the Consolidated Statements of Income in provision for credit losses. For additional information on the Company's allowance for credit loss activities, see Note 7, “Allowance for Credit Losses.”

Premises and Equipment

Premises and equipment are carried at cost less accumulated depreciation and amortization. Depreciation is calculated predominantly using the straight-line method over the assets’ estimated useful lives. Leasehold improvements are amortized using the straight-line method over the shorter of the improvements' estimated useful lives or the lease term. Construction and software in process includes costs related to in-process branch expansion, branch renovation, and software development projects. Upon completion, branch and office related projects are maintained in premises and equipment while completed software projects are reclassified to other assets in the Consolidated Balance Sheets. Maintenance and repairs are charged to expense, and improvements that extend the useful life of an asset are capitalized and depreciated over the remaining useful life. Premises and equipment are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. For additional information on the Company’s premises and equipment activities, see Note 8, “Premises and Equipment.”

Goodwill and Other Intangible Assets

Goodwill represents the excess purchase price over the fair value of identifiable net assets of acquired companies. Goodwill is assigned to reporting units, which are operating segments or one level below an operating segment, as of the acquisition date; more specifically, it is assigned to units that are expected to benefit from the synergies of the business combination.

Goodwill is tested at the reporting unit level for impairment, at least annually as of October 1, or as events and circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount.

If, after considering all relevant events and circumstances, the Company determines it is not more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, then performing an impairment test is not necessary. If the Company elects to bypass the qualitative analysis, or concludes via qualitative analysis that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying value, a two-step goodwill impairment test is performed. In the first step, the fair value of each reporting unit is compared with its carrying value. If the fair value is greater than the carrying value, then the reporting unit's goodwill is deemed not to be impaired. If the fair value is less than the carrying value, then the second step is performed, which measures the amount of impairment by comparing the carrying amount of goodwill to its implied fair value. If the implied fair value of the goodwill exceeds the carrying amount, there is no impairment. If the carrying amount exceeds the implied fair value of the goodwill, an impairment charge is recorded for the excess.

The Company has identified intangible assets with finite and indefinite lives. Intangible assets that have finite lives are amortized over their useful lives and carried at amortized cost. Intangible assets that have indefinite lives are initially measured at fair value and are not amortized until the useful life is no longer considered indefinite. Indefinite-lived intangibles are tested for impairment at least annually; however, all intangible assets are evaluated for impairment whenever events or changes in circumstances indicate it is more likely than not that the asset is impaired. For additional information on the Company’s activities related to goodwill and other intangibles, see Note 9, “Goodwill and Other Intangible Assets.”

Servicing Rights

The Company recognizes as assets the rights to service loans, either when the loans are sold and the associated servicing rights are retained or when servicing rights are purchased from a third party. All servicing rights are initially measured at fair value.

Fair value is determined by projecting net servicing cash flows, which are then discounted to estimate fair value. The fair value of servicing rights is impacted by a variety of factors, including prepayment assumptions, discount rates, delinquency rates, contractually specified servicing fees, servicing costs, and underlying portfolio characteristics. The underlying assumptions and estimated values are corroborated by values received from independent third parties and comparisons to market transactions.

The Company has elected to subsequently account for its residential MSRs under the fair value measurement method and actively hedges the change in fair value of its residential MSRs. The Company has elected to subsequently account for all other servicing rights, which include commercial mortgage and consumer loan servicing rights, under the amortization method. Commercial mortgage and consumer loan servicing rights are amortized in proportion to and over the period of estimated net servicing income. Servicing rights accounted for under the amortization method are periodically tested for impairment by comparing the carrying amount of the servicing rights to the estimated fair value.

Servicing rights are included in other intangible assets on the Consolidated Balance Sheets. For residential MSRs, both servicing fees, which are recognized when they are received, and changes in the fair value of MSRs are reported in mortgage servicing related income in the Consolidated Statements of Income. For all other servicing rights, servicing fees, amortization, and any impairment, are recognized in other noninterest income in the Consolidated Statements of Income.

For additional information on the Company’s servicing rights, see Note 9, “Goodwill and Other Intangible Assets.”

Other Real Estate Owned

Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at the lower of the loan’s cost basis or the asset’s fair value at the date of foreclosure, less estimated selling costs. To the extent fair value, less cost to sell, is less than the loan’s cost basis, the difference is charged to the ALLL at the date of transfer into OREO. The Company estimates market values based primarily on appraisals and other market information. Any subsequent changes in value as well as gains or losses from the disposition on these assets are reported in noninterest expense in the Consolidated Statements of Income. For additional information on the Company's activities related to OREO, see Note 18, “Fair Value Election and Measurement.”

Loan Sales and Securitizations

The Company sells and at times may securitize loans and other financial assets. When the Company securitizes assets, it may hold a portion of the securities issued, including senior interests, subordinated and other residual interests, interest-only strips, and principal-only strips, all of which are considered retained interests in the transferred assets. Retained securitized interests are recognized and initially measured at fair value. The interests in securitized assets held by the Company are typically classified as either securities AFS or trading assets and measured at fair value, which is based on independent, third party market prices, market prices for similar assets, or discounted cash flow analyses. If market prices are not available, fair value is calculated using management’s best estimates of key assumptions, including credit losses, loan repayment speeds, and discount rates commensurate with the risks involved.

The Company transfers first lien residential mortgage loans in conjunction with GSE securitization transactions, whereby the loans are exchanged for cash or securities that are readily redeemable for cash and servicing rights are retained. Net gains on the sale of residential mortgage loans are recorded at inception of the associated IRLCs within mortgage production related income in the Consolidated Statements of Income. The net gains reflect the change in value of the loans resulting from changes in interest rates from the time the Company enters into IRLCs with borrowers and when the loan is closed, adjusted for pull through rates and excluding hedge transactions initiated to mitigate this market risk.

Effective with the acquisition of substantially all of the assets of Pillar on December 15, 2016, the Company also sells commercial mortgage loans to Fannie Mae and Freddie Mac and issues and sells Ginnie Mae commercial MBS backed by FHA insured loans. The loans and securities are exchanged for cash and servicing rights are retained. Gains and losses from the sale of these commercial mortgage loans and securities are recorded within other noninterest income in the Consolidated Statements of Income. For additional information on the Company’s securitization activities, see Note 10, “Certain Transfers of Financial Assets and Variable Interest Entities.”

Income Taxes

The provision for income taxes is based on income and expense reported for financial statement purposes after adjustment for permanent differences such as interest income from lending to tax-exempt entities, tax credits from community reinvestment activities, and amortization expense related to qualified affordable housing investment costs. In computing the income tax provision, the Company evaluates the technical merits of its income tax positions based on current legislative, judicial, and regulatory guidance. Additionally, in 2016, the Company began recognizing all excess tax benefits and deficiencies on employee share-based payments as a component of the provision for income taxes in the Consolidated Statements of Income. These tax effects, generally determined upon the exercise of stock options or vesting of restricted stock, are treated as discrete items in the period in which they occur. The deferral method of accounting is used on investments that generate investment tax credits, such that the investment tax credits are recognized as a reduction to the related investment.

Deferred income tax assets and liabilities result from differences between the timing of the recognition of assets and liabilities for financial reporting purposes and for income tax purposes. These assets and liabilities are measured using the enacted tax rates and laws that are expected to apply in the periods in which the deferred tax assets or liabilities are expected to be realized. Subsequent changes in the tax laws require adjustment to these assets and liabilities with the cumulative effect included in the provision for income taxes for the period in which the change is enacted. A valuation allowance is recognized for a DTA if, based on the weight of available evidence, it is more-likely-than-not that some portion or all of the DTA will not be realized.

Interest and penalties related to the Company’s tax positions are recognized as a component of the provision for income taxes in the Consolidated Statements of Income. For additional information on the Company’s activities related to income taxes, see Note 14, “Income Taxes.”

Earnings Per Share

Basic EPS is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during each period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during each period, plus common share equivalents calculated for stock options, warrants, and restricted stock outstanding using the treasury stock method.

The Company has issued certain restricted stock awards, which are unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents. These restricted shares are considered participating securities. Accordingly, the Company calculated net income available to common shareholders pursuant to the two-class method, whereby net income is allocated between common shareholders and participating securities.

Net income available to common shareholders represents net income after preferred stock dividends, gains or losses from any repurchases of preferred stock, and dividends and allocation of undistributed earnings to the participating securities. For additional information on the Company’s EPS, see Note 12, “Net Income Per Common Share.”

Securities Sold Under Agreements to Repurchase and Securities Borrowed or Purchased Under Agreements to Resell

Securities sold under agreements to repurchase and securities borrowed or purchased under agreements to resell are accounted for as collateralized financing transactions and are recorded at the amounts at which the securities were sold or acquired, plus accrued interest. The fair value of collateral pledged or received is continually monitored and additional collateral is obtained or requested to be returned to the Company as deemed appropriate. For additional information on the collateral pledged to secure repurchase agreements, see Note 3, "Federal Funds Sold and Securities Financing Activities," Note 4, "Trading Assets and Liabilities and Derivatives," and Note 5, "Securities Available for Sale."

Guarantees

The Company recognizes a liability at the inception of a guarantee at an amount equal to the estimated fair value of the obligation. A guarantee is defined as a contract that contingently requires a company to make a payment to a guaranteed party based upon changes in an underlying asset, liability, or equity security of the guaranteed party, or upon failure of a third party to perform under a specified agreement. The Company considers the following arrangements to be guarantees: certain asset purchase/sale agreements with recourse, standby letters of credit and financial guarantees, certain indemnification agreements included within third party contractual arrangements, and certain derivative contracts. For additional information on the Company’s guarantor obligations, see Note 16, “Guarantees.”

Derivative Instruments and Hedging Activities

The Company records derivative contracts at fair value in the Consolidated Balance Sheets. Accounting for changes in the fair value of a derivative is dependent upon whether or not it has been designated in a formal, qualifying hedging relationship.

Changes in the fair value of derivatives not designated in a hedging relationship are recorded in noninterest income. This includes derivatives that the Company enters into in a dealer capacity to facilitate client transactions and as a risk management tool to economically hedge certain identified risks, along with certain IRLCs on residential mortgage and commercial loans that are a normal part of the Company’s operations. The Company also evaluates contracts, such as brokered deposits and debt, to determine whether any embedded derivatives are required to be bifurcated and separately accounted for as freestanding derivatives.

Certain derivatives used as risk management tools are also designated as accounting hedges of the Company’s exposure to changes in interest rates or other identified market risks. The Company prepares written hedge documentation for all derivatives which are designated as hedges of (1) changes in the fair value of a recognized asset or liability (fair value hedge) attributable to a specified risk or (2) a forecasted transaction, such as the variability of cash flows to be received or paid related to a recognized asset or liability (cash flow hedge). The written hedge documentation includes identification of, among other items, the risk management objective, hedging instrument, hedged item and methodologies for assessing and measuring hedge effectiveness and ineffectiveness, along with support for management’s assertion that the hedge will be highly effective. Methodologies related to hedge effectiveness and ineffectiveness are consistent between similar types of hedge transactions and include (i) statistical regression analysis of changes in the cash flows of the actual derivative and a perfectly effective hypothetical derivative, or (ii) statistical regression analysis of changes in the fair values of the actual derivative and the hedged item.

For designated hedging relationships, the Company performs retrospective and prospective effectiveness testing using quantitative methods and does not assume perfect effectiveness through the matching of critical terms. Assessments of hedge effectiveness and measurements of hedge ineffectiveness are performed at least quarterly. Changes in the fair value of a derivative that is highly effective and that has been designated and qualifies as a fair value hedge are recorded in current period earnings, along with the changes in the fair value of the hedged item that are attributable to the hedged risk. The effective portion of the changes in the fair value of a derivative that is highly effective and that has been designated and qualifies as a cash flow hedge is initially recorded in AOCI and reclassified to earnings in the same period that the hedged item impacts earnings; any ineffective portion is recorded in current period earnings.

Hedge accounting ceases on transactions that are no longer deemed effective, or for which the derivative has been terminated or de-designated. For discontinued fair value hedges where the hedged item remains outstanding, the hedged item would cease to be remeasured at fair value attributable to changes in the hedged risk and any existing basis adjustment would be recognized as an adjustment to earnings over the remaining life of the hedged item. For discontinued cash flow hedges, the unrealized gains and losses recorded in AOCI would be reclassified to earnings in the period when the previously designated hedged cash flows occur unless it was determined that transaction was probable to not occur, whereby any unrealized gains and losses in AOCI would be immediately reclassified to earnings.

It is the Company's policy to offset derivative transactions with a single counterparty as well as any cash collateral paid to and received from that counterparty for derivative contracts that are subject to ISDA or other legally enforceable netting arrangements and meet accounting guidance for offsetting treatment. For additional information on the Company’s derivative activities, see Note 17, “Derivative Financial Instruments,” and Note 18, “Fair Value Election and Measurement.”

Stock-Based Compensation

The Company sponsors various stock-based compensation plans under which RSUs, restricted stock, and phantom stock units may be granted to certain employees. The Company measures the grant date fair value of the RSUs and restricted stock, which is expensed over the award's vesting period. Additionally, the Company estimates the number of awards for which it is probable that service will be rendered and adjusts compensation cost accordingly. Estimated forfeitures are subsequently adjusted to reflect actual forfeitures.

The phantom stock units are subject to variable accounting and grant certain employees the contractual right to receive an amount in cash equal to the fair market value of a share of common stock on the vesting date. For additional information on the Company’s stock-based compensation plans, see Note 15, “Employee Benefit Plans.”

Employee Benefits

Employee benefits expense includes expenses related to (i) net periodic benefit costs or credits associated with the pension and other postretirement benefit plans, (ii) contributions under the defined contribution plans, (iii) the amortization of restricted stock, (iv) the issuance of phantom stock units, (v) historical stock option issuances, and (vi) other employee medical and benefits costs. For additional information on the Company's employee benefit plans, see Note 15, “Employee Benefit Plans.”

Foreign Currency Transactions

Foreign denominated assets and liabilities resulting from foreign currency transactions are valued using period end foreign exchange rates and the associated interest income or expense is determined using weighted average exchange rates for the period. The Company may enter into foreign currency derivatives to mitigate its exposure to changes in foreign exchange rates. The derivative contracts are accounted for at fair value on a recurring basis with any resulting gains and losses recorded in noninterest income in the Consolidated Statements of Income.

Related Party Transactions

The Company periodically enters into transactions with certain of its executive officers, directors, affiliates, trusts, and/or other related parties in its ordinary course of business. ASC 850 requires disclosure of material related party transactions, other than certain compensation and other arrangements entered into in the normal course of business. The Company has included information related to its relationships with VIEs and employee benefit plan arrangements in its Notes to the Consolidated Financial Statements in this Form 10-K.

Fair Value Measurement

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Depending on the nature of the asset or liability, the Company uses various valuation techniques and assumptions when estimating fair value. The Company prioritizes inputs used in valuation techniques based on the following fair value hierarchy:


•	Level 1 – Assets or liabilities valued using unadjusted quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date, such as publicly-traded instruments or futures contracts


•	Level 2 – Assets or liabilities valued based on observable market data for similar instruments traded in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets


•	Level 3 – Assets or liabilities for which significant valuation assumptions are not readily observable in the market; instruments valued based on the best available data, some of which may be internally developed, and considers risk premiums that a market participant would require

When measuring assets and liabilities at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. Assets and liabilities that are required to be measured at fair value on a recurring basis include trading securities, securities AFS, and derivative instruments. Assets and liabilities that the Company has elected to measure at fair value on a recurring basis include certain MSRs and LHFS, LHFI, trading loans, brokered time deposits, and issuances of fixed rate debt. Other assets and liabilities are measured at fair value on a non-recurring basis, such as when assets are evaluated for impairment, the basis of accounting is LOCOM, or for disclosure purposes. Examples of these non-recurring fair value measurements include certain LHFS and LHFI, OREO, certain cost or equity method investments, and long-lived assets. For additional information on the Company’s valuation of its assets and liabilities held at fair value, see Note 18, “Fair Value Election and Measurement.”

Recently Issued Accounting Pronouncements

The following table summarizes ASUs recently issued by the FASB that could have a material effect on the Company's financial statements:



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
Standards Adopted (or partially adopted) in 2016
ASU 2015-02, Amendments to the Consolidation Analysis	The ASU rescinds the indefinite deferral of previous amendments to ASC Topic 810, Consolidation, for certain entities and amends components of the consolidation analysis under ASC Topic 810, including evaluating limited partnerships and similar legal entities, evaluating fees paid to a decision maker or service provider as a variable interest, the effects of fee arrangements and/or related parties on the primary beneficiary determination and investment fund specific matters. The ASU may be adopted either retrospectively or on a modified retrospective basis.	January 1, 2016	The Company adopted this ASU on a modified retrospective basis beginning January 1, 2016. The adoption of this standard had no impact to the Consolidated Financial Statements.
ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs	The ASU amends ASC Topic 835, Interest, to simplify the presentation of debt issuance costs and to require that debt issuance costs, related to a recognized debt liability, be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the ASU. The new ASU should be applied on a retrospective basis.	January 1, 2016	The Company adopted the ASU beginning January 1, 2016 to present long-term debt net of debt issuance costs in the Consolidated Financial Statements. Debt issuance costs in the comparative prior year period were immaterial for reclassification and were recorded in other assets on the Company's Consolidated Balance Sheets at December 31, 2015.
ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities	The ASU amends ASC Topic 825, Financial Instruments-Overall, and addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The main provisions require investments in equity securities to be measured at fair value through net income, unless they qualify for a practicability exception, and require fair value changes arising from changes in instrument-specific credit risk for financial liabilities that are measured under the fair value option to be recognized in other comprehensive income. With the exception of disclosure requirements that will be adopted prospectively, the ASU must be adopted on a modified retrospective basis.	January 1, 2018 Early adoption is permitted beginning January 1, 2016 or 2017 for the provision related to changes in instrument-specific credit risk for financial liabilities under the FVO.	The Company early adopted the provision related to changes in instrument-specific credit risk beginning January 1, 2016, which resulted in an immaterial, cumulative effect adjustment from retained earnings to AOCI. See Note 21, "Accumulated Other Comprehensive (Loss)/Income" for additional information. The Company is evaluating the impact of the remaining provisions of this ASU on the Consolidated Financial Statements and related disclosures; however, the impact is not expected to be material.



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
ASU 2016-09, Improvements to Employee Share-Based Payment Accounting	The ASU amends ASC Topic 718, Compensation-Stock Compensation, which simplifies several aspects of the accounting for employee share-based payments transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. Adoption methods are specific to the component of the ASU, ranging from a retrospective and modified retrospective basis to a prospective basis.	January 1, 2017 Early adoption is permitted.	The Company early adopted the ASU on April 1, 2016 with an effective date of January 1, 2016, which resulted in a reclassification of $4 million from APIC to provision for income taxes, representing excess tax benefits previously recognized in APIC during the first quarter of 2016. For the second, third, and fourth quarters of 2016, the Company recognized excess tax benefits totaling $11 million in the provision for income taxes. The early adoption favorably impacted basic and diluted EPS by $0.03 and $0.02 per share, respectively, for the year ended December 31, 2016. The effect of the retrospective change in presentation in the Consolidated Statements of Cash Flows related to excess tax benefits for the years ended December 31, 2015 and 2014 (comparative prior year periods) was a reclassification of $20 million and $6 million, respectively, of excess tax benefits from financing activities to operating activities and a reclassification of $36 million and $16 million, respectively, of taxes paid related to net share settlement of equity awards from operating activities to financing activities. The net impact on the Consolidated Statements of Cash Flows was immaterial. The Company had no previously unrecognized excess tax benefits; therefore, there was no impact to the Consolidated Financial Statements as it related to the elimination of the requirement that excess tax benefits be realized before recognition. The Company elected to retain its existing accounting policy election to estimate award forfeitures.
Standards Not Yet Adopted
ASU 2014-09, Revenue from Contracts with Customers ASU 2015-14, Deferral of the Effective Date ASU 2016-08, Principal versus Agent Considerations ASU 2016-10, Identifying Performance Obligations and Licensing ASU 2016-12, Narrow-Scope Improvements and Practical Expedients ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers	These ASUs supersede the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the ASUs is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASUs may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts, with remaining performance obligations as of the effective date.	January 1, 2018 Early adoption is permitted beginning January 1, 2017.	The Company is evaluating the anticipated effects of these ASUs on the Consolidated Financial Statements and related disclosures. The Company has conducted a comprehensive scoping exercise to determine the revenue streams that are in the scope of these updates. Preliminary results indicate that certain noninterest income financial statement line items, including service charges on deposit accounts, card fees, other charges and fees, investment banking income, trust and investment management income, retail investment services, and other noninterest income, contain revenue streams that are in scope of these updates. Preliminary findings indicate that there may be some changes in the presentation of certain revenues and expenses based on the principal versus agent guidance within these updates; the materiality of these changes is still being assessed. The Company plans to adopt the standards beginning January 1, 2018 and expects to use the modified retrospective method of adoption.



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
ASU 2016-02, Leases	The ASU creates ASC Topic 842, Leases, and supersedes Topic 840, Leases. Topic 842 requires lessees to recognize right-of-use assets and associated liabilities that arise from leases, with the exception of short-term leases. The ASU does not make significant changes to lessor accounting; however, there were certain improvements made to align lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. There are several new qualitative and quantitative disclosures required. Upon transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach.	January 1, 2019 Early adoption is permitted.	The adoption of this ASU will result in an increase to the Consolidated Balance Sheets for right-of-use assets and associated lease liabilities for operating leases in which the Company is the lessee. The Company is evaluating the significance and other effects of adoption on the Consolidated Financial Statements and related disclosures.
ASU 2016-07, Simplifying the Transition to the Equity Method of Accounting	The ASU amends ASC Topic 323, Investments-Equity Method and Joint Ventures, to eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investor obtains significant influence over the investee. In addition, if the investor previously held an AFS equity security, the ASU requires that the investor recognize through earnings the unrealized holding gain or loss in AOCI, as of the date it obtains significant influence. The ASU is to be applied on a prospective basis.	January 1, 2017 Early application is permitted.	This ASU will not impact the Consolidated Financial Statements and related disclosures until there is an applicable increase in investment or change in influence resulting in a transition to the equity method.
ASU 2016-13, Measurement of Credit Losses on Financial Instruments	The ASU amends ASC Topic 326, Financial Instruments-Credit Losses, to replace the incurred loss impairment methodology with a current expected credit loss methodology for financial instruments measured at amortized cost and other commitments to extend credit. For this purpose, expected credit losses reflect losses over the remaining contractual life of an asset, considering the effect of voluntary prepayments and considering available information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. The resulting allowance for credit losses reflects the portion of the amortized cost basis that the entity does not expect to collect. Additional quantitative and qualitative disclosures are required upon adoption. The CECL model does not apply to AFS debt securities; however the ASU requires entities to record an allowance when recognizing credit losses for AFS securities, rather than recording a direct write-down of the carrying amount.	January 1, 2020 Early adoption is permitted beginning January 1, 2019.	The Company is evaluating the impact the ASU will have on the Company's Consolidated Financial Statements and related disclosures.

Acquisitions/Dispositions Acquisitions/Dispositions (Notes)

Mergers, Acquisitions and Dispositions Disclosures [Text Block]

NOTE 2 - ACQUISITIONS/DISPOSITIONS

During the years ended December 31, 2016, 2015, and 2014, the Company had the following notable acquisition and disposition:



(Dollars in millions)	Date	Cash (Paid)/Received			Goodwill		Other Intangible Assets			Pre-tax Gain
2016
Acquisition of Pillar	12/15/2016		($197	)		$—		$14	¹		$—
2014
Sale of RidgeWorth	5/30/2014	193			—		—			105

¹ Does not include servicing rights acquired.

Acquisition of Pillar

On December 15, 2016, the Company completed the acquisition of substantially all of the assets of the operating subsidiaries of Pillar Financial, LLC, a multi-family agency lending and servicing company with an originate-to-distribute focus that holds licenses with Fannie Mae, Freddie Mac, and the FHA. The acquired assets include Pillar's multi-family lending business, which is comprised of multi-family affordable housing, health care properties, senior housing, and manufactured housing specialty teams. Additionally, the transaction includes Cohen Financial's commercial real estate investor services business, offering loan administration and advisory services, as well as their commercial mortgage brokerage business.

The Company agreed to pay $197 million in cash and incurred an immaterial amount of acquisition-related costs for the acquisition; however, final cash settlement is to occur within 100 days after the acquisition date as specified in the purchase agreement, to capture any working capital adjustments. The acquisition of Pillar was accounted for using the acquisition method of accounting. The Company performed a preliminary allocation of the purchase price to the underlying assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition, presented in the following table.



(Dollars in millions)	December 15, 2016
Consideration		$197
Pillar purchase price allocation to:
Cash and cash equivalents		$9
LHFI	38
LHFS	182
Commercial mortgage servicing rights	62
Other intangible assets	14
Other assets	8
Other short-term borrowings	(100		)
Other liabilities	(16		)
Identified net assets acquired at fair value		$197

Goodwill		$—

At the date of acquisition, the UPB of LHFI and LHFS acquired were $38 million and $180 million, respectively, and the related contractual cash flows not expected to be collected were immaterial. At December 31, 2016, the valuation analyses of certain intangible assets acquired were not yet finalized. Review of these items will continue during the measurement period and any further changes to the preliminary purchase price allocation will be recognized as the valuations are finalized and final cash settlement occurs, which could change the amount of the preliminary purchase price allocation to goodwill. Additionally, other intangible assets acquired included $62 million of commercial mortgage servicing rights and $14 million related mainly to agency licenses. See Note 9, "Goodwill and Other Intangible Assets," for additional information regarding the identified intangible assets acquired.

The financial results of Pillar from the acquisition date through December 31, 2016 were immaterial and are reflected in the Wholesale Banking segment for the year ended December 31, 2016.

Sale of RidgeWorth

In 2014, the Company completed the sale of RidgeWorth, its asset management subsidiary with approximately $49.1 billion in assets under management. The Company received cash proceeds of $193 million, removed $96 million in net assets and $23 million in noncontrolling interests, and recognized a pre-tax gain of $105 million in connection with the sale, net of transaction-related expenses.

The Company’s results for the year ended December 31, 2014, included $22 million of income before provision for income taxes related to RidgeWorth, excluding the gain on sale, comprised of $81 million of revenue and $59 million of expense. The financial results of RidgeWorth, including the gain on sale, are reflected in the Corporate Other segment for the year ended December 31, 2014.

There were no other material acquisitions or dispositions during the three years ended December 31, 2016.

Federal Funds Sold and Securities Borrowed or Purchased Under Agreements to Resell

Repurchase Agreements, Resale Agreements, Securities Borrowed, and Securities Loaned Disclosure [Text Block]

NOTE 3 - FEDERAL FUNDS SOLD AND SECURITIES FINANCING ACTIVITIES

Federal Funds Sold and Securities Borrowed or Purchased Under Agreements to Resell

Fed funds sold and securities borrowed or purchased under agreements to resell were as follows:



(Dollars in millions)	December 31, 2016		December 31, 2015
Fed funds sold		$58		$38
Securities borrowed	270		277
Securities purchased under agreements to resell	979		962
Total Fed funds sold and securities borrowed or purchased under agreements to resell		$1,307		$1,277

Securities purchased under agreements to resell are primarily collateralized by U.S. government or agency securities and are carried at the amounts at which the securities will be subsequently resold, plus accrued interest. Securities borrowed are primarily collateralized by corporate securities. The Company borrows securities and purchases securities under agreements to resell as part of its securities financing activities. On the acquisition date of these securities, the Company and the related counterparty agree on the amount of collateral required to secure the principal amount loaned under these arrangements. The Company monitors collateral values daily and calls for additional collateral to be provided as warranted under the respective agreements. At December 31, 2016 and 2015, the total market value of collateral held was $1.3 billion and $1.2 billion, of which $246 million and $73 million was repledged, respectively.

Securities Sold Under Agreements to Repurchase

Securities sold under agreements to repurchase are accounted for as secured borrowings. The following table presents the Company’s related activity, by collateral type and remaining contractual maturity:



	December 31, 2016								December 31, 2015
(Dollars in millions)	Overnight and Continuous		Up to 30 days		30-90 days		Total		Overnight and Continuous		Up to 30 days		Total
U.S. Treasury securities		$27		$—		$—		$27		$112		$—		$112
Federal agency securities	288		24		—		312		319		—		319
MBS - agency	793		51		—		844		837		23		860
CP	49		—		—		49		49		—		49
Corporate and other debt securities	311		50		40		401		242		72		314
Total securities sold under agreements to repurchase		$1,468		$125		$40		$1,633		$1,559		$95		$1,654

For these securities sold under agreements to repurchase, the Company would be obligated to provide additional collateral in the event of a significant decline in fair value of the collateral pledged. This risk is managed by monitoring the liquidity and credit quality of the collateral, as well as the maturity profile of the transactions.

Netting of Securities - Repurchase and Resell Agreements

The Company has various financial assets and financial liabilities that are subject to enforceable master netting agreements or similar agreements. The Company's derivatives that are subject to enforceable master netting agreements or similar agreements are discussed in Note 17, "Derivative Financial Instruments." The following table presents the Company's securities borrowed or purchased under agreements to resell and securities sold under agreements to repurchase that are subject to MRAs. Generally, MRAs require collateral to exceed the asset or liability recognized on the balance sheet. Transactions subject to these agreements are treated as collateralized financings, and those with a single counterparty are permitted to be presented net on the Company's Consolidated Balance Sheets, provided certain criteria are met that permit balance sheet netting. At December 31, 2016 and 2015, there were no such transactions subject to legally enforceable MRAs that were eligible for balance sheet netting.

The following table includes the amount of collateral pledged or received related to exposures subject to enforceable MRAs. While these agreements are typically over-collateralized, U.S. GAAP requires disclosure in this table to limit the amount of such collateral to the amount of the related recognized asset or liability for each counterparty.



(Dollars in millions)	Gross Amount		Amount Offset		Net Amount Presented in Consolidated Balance Sheets			Held/Pledged Financial Instruments		Net Amount
December 31, 2016
Financial assets:
Securities borrowed or purchased under agreements to resell		$1,249		$—		$1,249	¹		$1,241		$8
Financial liabilities:
Securities sold under agreements to repurchase	1,633		—		1,633			1,633		—

December 31, 2015
Financial assets:
Securities borrowed or purchased under agreements to resell		$1,239		$—		$1,239	¹		$1,229		$10
Financial liabilities:
Securities sold under agreements to repurchase	1,654		—		1,654			1,654		—

¹Excludes $58 million and $38 million of Fed funds sold, which are not subject to a master netting agreement at December 31, 2016 and 2015, respectively.

Trading Assets and Liabilities and Derivatives Trading Assets and Liabilities and Derivatives

Trading Assets and Liabilities and Derivatives [Text Block]

NOTE 4 - TRADING ASSETS AND LIABILITIES AND DERIVATIVE INSTRUMENTS

The fair values of the components of trading assets and liabilities and derivative instruments are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Trading Assets and Derivative Instruments:
U.S. Treasury securities		$539		$538
Federal agency securities	480		588
U.S. states and political subdivisions	134		30
MBS - agency	567		553
CLO securities	1		2
Corporate and other debt securities	656		468
CP	140		67
Equity securities	49		66
Derivative instruments ¹	984		1,152
Trading loans ²	2,517		2,655
Total trading assets and derivative instruments		$6,067		$6,119

Trading Liabilities and Derivative Instruments:
U.S. Treasury securities		$697		$503
MBS - agency	1		37
Corporate and other debt securities	255		259
Derivative instruments ¹	398		464
Total trading liabilities and derivative instruments		$1,351		$1,263

¹Amounts include the impact of offsetting cash collateral received from and paid to the same derivative counterparties, and the impact of netting derivative assets and derivative liabilities when a legally enforceable master netting agreement or similar agreement exists.

² Includes loans related to TRS.

Various trading and derivative instruments are used as part of the Company’s overall balance sheet management strategies and to support client requirements executed through the Bank and/or STRH, a broker/dealer subsidiary of the Company. The Company manages the potential market volatility associated with trading instruments with appropriate risk management strategies. The size, volume, and nature of the trading products and derivative instruments can vary based on economic conditions as well as client-specific and Company-specific asset or liability positions. Product offerings to clients include debt securities, loans traded in the secondary market, equity securities, derivative contracts, and other similar financial instruments. Other trading-related activities include acting as a market maker for certain debt and equity security transactions, derivative instrument transactions, and foreign exchange transactions. The Company also uses derivatives to manage its interest rate and market risk from non-trading activities. The Company has policies and procedures to manage market risk associated with client trading and non-trading activities, and assumes a limited degree of market risk by managing the size and nature of its exposure. For valuation assumptions and additional information related to the Company's trading products and derivative instruments, see Note 17, “Derivative Financial Instruments,” and the “Trading Assets and Derivative Instruments and Securities Available for Sale” section of Note 18, “Fair Value Election and Measurement.”

Pledged trading assets are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Pledged trading assets to secure repurchase agreements ¹		$968		$986
Pledged trading assets to secure certain derivative agreements	471		393
Pledged trading assets to secure other arrangements	40		40

¹ Repurchase agreements secured by collateral totaled $928 million and $950 million at December 31, 2016 and 2015, respectively.

Securities Available for Sale

NOTE 5 – SECURITIES AVAILABLE FOR SALE

Securities Portfolio Composition



	December 31, 2016
(Dollars in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U.S. Treasury securities		$5,486		$5		$86		$5,405
Federal agency securities	310		5		2		313
U.S. states and political subdivisions	279		5		5		279
MBS - agency	23,642		313		293		23,662
MBS - non-agency residential	71		3		—		74
MBS - non-agency commercial	257		—		5		252
ABS	8		2		—		10
Corporate and other debt securities	34		1		—		35
Other equity securities ¹	642		1		1		642
Total securities AFS		$30,729		$335		$392		$30,672

	December 31, 2015
(Dollars in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U.S. Treasury securities		$3,460		$3		$14		$3,449
Federal agency securities	402		10		1		411
U.S. states and political subdivisions	156		8		—		164
MBS - agency	22,877		397		150		23,124
MBS - non-agency residential	92		2		—		94
ABS	11		2		1		12
Corporate and other debt securities	37		1		—		38
Other equity securities ¹	533		1		1		533
Total securities AFS		$27,568		$424		$167		$27,825

¹ At December 31, 2016, the fair value of other equity securities was comprised of the following: $132 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, $102 million of mutual fund investments, and $6 million of other.

At December 31, 2015, the fair value of other equity securities was comprised of the following: $32 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, $93 million of mutual fund investments, and $6 million of other.

The following table presents interest and dividends on securities AFS:



	Year Ended December 31
(Dollars in millions)	2016		2015		2014
Taxable interest		$630		$552		$565
Tax-exempt interest	6		6		10
Dividends	15		35		38
Total interest and dividends on securities AFS		$651		$593		$613

Securities AFS pledged to secure public deposits, repurchase agreements, trusts, and other funds had a fair value of $2.0 billion and $3.2 billion at December 31, 2016 and 2015, respectively.

The following table presents the amortized cost, fair value, and weighted average yield of investments in debt securities AFS at December 31, 2016, by remaining contractual maturity, with the exception of MBS and ABS, which are based on estimated average life. Receipt of cash flows may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalties.



	Distribution of Remaining Maturities
(Dollars in millions)	Due in 1 Year or Less			Due After 1 Year through 5 Years			Due After 5 Years through 10 Years			Due After 10 Years			Total
Amortized Cost:
U.S. Treasury securities		$—			$2,344			$3,142			$—			$5,486
Federal agency securities	114			87			7			102			310
U.S. states and political subdivisions	10			21			83			165			279
MBS - agency	1,889			12,667			8,847			239			23,642
MBS - non-agency residential	—			48			23			—			71
MBS - non-agency commercial	—			12			245			—			257
ABS	7			—			1			—			8
Corporate and other debt securities	15			19			—			—			34
Total debt securities AFS		$2,035			$15,198			$12,348			$506			$30,087
Fair Value:
U.S. Treasury securities		$—			$2,332			$3,073			$—			$5,405
Federal agency securities	114			91			7			101			313
U.S. states and political subdivisions	10			22			86			161			279
MBS - agency	1,989			12,788			8,645			240			23,662
MBS - non-agency residential	—			50			24			—			74
MBS - non-agency commercial	—			12			240			—			252
ABS	8			—			2			—			10
Corporate and other debt securities	16			19			—			—			35
Total debt securities AFS		$2,137			$15,314			$12,077			$502			$30,030
Weighted average yield ¹	3.01		%	2.40		%	2.42		%	3.14		%	2.46		%

¹Weighted average yields are based on amortized cost.

Securities AFS in an Unrealized Loss Position

The Company held certain investment securities AFS where amortized cost exceeded fair value, resulting in unrealized loss positions. Market changes in interest rates and credit spreads may result in temporary unrealized losses as the market prices of securities fluctuate. At December 31, 2016, the Company did not intend to sell these securities nor was it more-likely-than-not that the Company would be required to sell these securities before their anticipated recovery or maturity. The Company reviewed its portfolio for OTTI in accordance with the accounting policies described in Note 1, "Significant Accounting Policies."

Securities AFS in an unrealized loss position at period end are presented in the following tables:



	December 31, 2016
	Less than twelve months				Twelve months or longer				Total
(Dollars in millions)	Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses ²
Temporarily impaired securities AFS:
U.S. Treasury securities		$4,380		$86		$—		$—		$4,380		$86
Federal agency securities	96		2		3		—		99		2
U.S. states and political subdivisions	149		5		—		—		149		5
MBS - agency	14,622		285		451		8		15,073		293
MBS - non-agency commercial	184		5		—		—		184		5
ABS	—		—		5		—		5		—
Corporate and other debt securities	12		—		—		—		12		—
Other equity securities	—		—		4		1		4		1
Total temporarily impaired securities AFS	19,443		383		463		9		19,906		392
OTTI securities AFS ¹:
MBS - non-agency residential	16		—		—		—		16		—
ABS	—		—		1		—		1		—
Total OTTI securities AFS	16		—		1		—		17		—
Total impaired securities AFS		$19,459		$383		$464		$9		$19,923		$392



	December 31, 2015
	Less than twelve months				Twelve months or longer				Total
(Dollars in millions)	Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses ²
Temporarily impaired securities AFS:
U.S. Treasury securities		$2,169		$14		$—		$—		$2,169		$14
Federal agency securities	75		—		34		1		109		1
MBS - agency	11,434		114		958		36		12,392		150
ABS	—		—		7		1		7		1
Other equity securities	3		1		—		—		3		1
Total temporarily impaired securities AFS	13,681		129		999		38		14,680		167
OTTI securities AFS ¹:
ABS	1		—		—		—		1		—
Total OTTI securities AFS	1		—		—		—		1		—
Total impaired securities AFS		$13,682		$129		$999		$38		$14,681		$167

¹OTTI securities AFS are impaired securities for which OTTI credit losses have been previously recognized in earnings.

²Unrealized losses less than $0.5 million are presented as zero within the table.

At December 31, 2016, temporarily impaired securities AFS that have been in an unrealized loss position for twelve months or longer included agency MBS, federal agency securities, one ABS collateralized by 2004 vintage home equity loans, and one equity security. Unrealized losses on these temporarily impaired agency MBS and federal agency securities were due to market interest rates being higher than the securities' stated coupon rates. The temporarily impaired ABS continues to receive timely principal and interest payments, and is evaluated quarterly for credit impairment. Unrealized losses on securities AFS that relate to factors other than credit are recorded in AOCI, net of tax.

Realized Gains and Losses and Other-Than-Temporarily Impaired Securities AFS



	Year Ended December 31
(Dollars in millions)	2016		2015			2014
Gross realized gains		$4		$25			$28
Gross realized losses	—		(3		)	(42		)
OTTI credit losses recognized in earnings	—		(1		)	(1		)
Net securities gains/(losses)		$4		$21			($15	)

Securities AFS in an unrealized loss position are evaluated quarterly for other-than-temporary credit impairment, which is determined using cash flow analyses that take into account security specific collateral and transaction structure. Future expected credit losses are determined using various assumptions, the most significant of which include default rates, prepayment rates, and loss severities. If, based on this analysis, a security is in an unrealized loss position and the Company does not expect to recover the entire amortized cost basis of the security, the expected cash flows are then discounted at the security’s initial effective interest rate to arrive at a present value amount. Credit losses on the OTTI security are recognized in earnings and reflect the difference between the present value of cash flows expected to be collected and the amortized cost basis of the security. See Note 1, "Significant Accounting Policies," for additional information regarding the Company's policy on securities AFS and related impairments.

The Company continues to reduce existing exposure on OTTI securities primarily through paydowns. In certain instances, the amount of credit losses recognized in earnings on a debt security exceeds the total unrealized losses on the security, which may result in unrealized gains relating to factors other than credit recorded in AOCI, net of tax.

During the year ended December 31, 2016, there were no credit impairment losses recognized on securities AFS held at the end of the period. During the years ended December 31, 2015 and 2014, credit impairment recognized on securities AFS still held at the end of the period was immaterial. The accumulated balance of OTTI credit losses recognized in earnings on securities AFS held at period end was $23 million at December 31, 2016 and $25 million at both December 31, 2015 and 2014. Subsequent credit losses may be recorded on securities without a corresponding further decline in fair value when there has been a decline in expected cash flows.

The following table presents a summary of the significant inputs used in determining the measurement of OTTI credit losses recognized in earnings for non-agency MBS for the years ended December 31:



	2016 ²	2015 ¹	2014 ¹
Default rate	N/A	9%	2%
Prepayment rate	N/A	13%	16%
Loss severity	N/A	56%	46%

¹ For the year ended December 31, 2015, all OTTI credit losses recognized in earnings related to one non-agency MBS with a fair value of approximately $20 million at December 31, 2015. For the year ended December 31, 2014, all OTTI credit losses recognized in earnings related to one non-agency MBS with a fair value of $16 million at December 31, 2014.

² "N/A" - Not applicable as there were no OTTI credit losses recognized in earnings for the year ended December 31, 2016.

Assumption ranges represent the lowest and highest lifetime average estimates of each security for which credit losses were recognized in earnings. Ranges may vary from period to period as the securities for which credit losses are recognized vary. Additionally, severity may vary widely when losses are few and large.

Loans

Loans, Notes, Trade and Other Receivables, Excluding Allowance for Credit Losses [Text Block]

NOTE 6 - LOANS

Composition of Loan Portfolio



(Dollars in millions)	December 31, 2016		December 31, 2015
Commercial loans:
C&I		$69,213		$67,062
CRE	4,996		6,236
Commercial construction	4,015		1,954
Total commercial loans	78,224		75,252
Residential loans:
Residential mortgages - guaranteed	537		629
Residential mortgages - nonguaranteed ¹	26,137		24,744
Residential home equity products	11,912		13,171
Residential construction	404		384
Total residential loans	38,990		38,928
Consumer loans:
Guaranteed student	6,167		4,922
Other direct	7,771		6,127
Indirect	10,736		10,127
Credit cards	1,410		1,086
Total consumer loans	26,084		22,262
LHFI		$143,298		$136,442
LHFS ²		$4,169		$1,838

¹Includes $222 million and $257 million of LHFI measured at fair value at December 31, 2016 and 2015, respectively.

²Includes $3.5 billion and $1.5 billion of LHFS measured at fair value at December 31, 2016 and 2015, respectively.

During the years ended December 31, 2016 and 2015, the Company transferred $360 million and $1.8 billion in LHFI to LHFS, and $30 million and $741 million in LHFS to LHFI, respectively. In addition to sales of residential and commercial mortgage LHFS in the normal course of business, the Company sold $1.6 billion and $2.1 billion in loans and leases for net gains of $6 million and $22 million during the years ended December 31, 2016 and 2015, respectively.

During the years ended December 31, 2016 and 2015, the Company's significant loan purchases included $2.2 billion and $1.2 billion of guaranteed student loans, respectively.

At December 31, 2016 and 2015, the Company had $22.6 billion and $23.6 billion of net eligible loan collateral pledged to the Federal Reserve discount window to support $17.0 billion and $17.2 billion of available, unused borrowing capacity, respectively.

At December 31, 2016 and 2015, the Company had $36.9 billion and $33.7 billion of net eligible loan collateral pledged to the FHLB of Atlanta to support $31.9 billion and $28.5 billion of available borrowing capacity, respectively. The available FHLB borrowing capacity at December 31, 2016 was used to support $2.8 billion of long-term debt and $7.3 billion of letters of credit issued on the Company's behalf. At December 31, 2015, the available FHLB borrowing capacity was used to support $408 million of long-term debt and $6.7 billion of letters of credit issued on the Company's behalf.

Credit Quality Evaluation

The Company evaluates the credit quality of its loan portfolio by employing a dual internal risk rating system, which assigns both PD and LGD ratings to derive expected losses. Assignment of these ratings are predicated upon numerous factors, including consumer credit risk scores, rating agency information, borrower/guarantor financial capacity, LTV ratios, collateral type, debt service coverage ratios, collection experience, other internal metrics/analyses, and/or qualitative assessments.

For the commercial portfolio, the Company believes that the most appropriate credit quality indicator is an individual loan’s risk assessment expressed according to the broad regulatory agency classifications of Pass or Criticized. The Company conforms to the following regulatory classifications for Criticized assets: Other Assets Especially Mentioned (or Special Mention), Adversely Classified, Doubtful, and Loss. However, for the purposes of disclosure, management believes the most meaningful distinction within the Criticized categories is between Criticized accruing (which includes Special Mention and a portion of Adversely Classified) and Criticized nonaccruing (which includes a portion of Adversely Classified and Doubtful and Loss). This distinction identifies those relatively higher risk loans for which there is a basis to believe that the Company will not collect all amounts due under those loan agreements. The Company's risk rating system is more granular, with multiple risk ratings in both the Pass and Criticized categories. Pass ratings reflect relatively low PDs, whereas, Criticized assets have higher PDs. The granularity in Pass ratings assists in establishing pricing, loan structures, approval requirements, reserves, and ongoing credit management requirements. Commercial risk ratings are refreshed at least annually, or more frequently as appropriate, based upon considerations such as market conditions, borrower characteristics, and portfolio trends. Additionally, management routinely reviews portfolio risk ratings, trends, and concentrations to support risk identification and mitigation activities. The increase in Criticized accruing and nonaccruing C&I loans at December 31, 2016 compared to December 31, 2015, as presented in the following risk rating table, was driven primarily by downgrades of loans in the energy industry vertical.

For consumer and residential loans, the Company monitors credit risk based on indicators such as delinquencies and FICO scores. The Company believes that consumer credit risk, as assessed by the industry-wide FICO scoring method, is a relevant credit quality indicator. Borrower-specific FICO scores are obtained at origination as part of the Company’s formal underwriting process, and refreshed FICO scores are obtained by the Company at least quarterly.

For government-guaranteed loans, the Company monitors the credit quality based primarily on delinquency status, as it is a more relevant indicator of credit quality due to the government guarantee. At December 31, 2016 and 2015, 29% and 31%, respectively, of the guaranteed residential loan portfolio was current with respect to payments. At December 31, 2016 and 2015, 75% and 78%, respectively, of the guaranteed student loan portfolio was current with respect to payments. The Company's loss exposure on guaranteed residential and student loans is mitigated by the government guarantee.

LHFI by credit quality indicator are presented in the following tables:



	Commercial Loans
	C&I				CRE				Commercial Construction
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Risk rating:
Pass		$66,920		$65,379		$4,574		$6,067		$3,914		$1,931
Criticized accruing	1,903		1,375		415		158		84		23
Criticized nonaccruing	390		308		7		11		17		—
Total		$69,213		$67,062		$4,996		$6,236		$4,015		$1,954



	Residential Loans ¹
	Residential Mortgages - Nonguaranteed				Residential Home Equity Products				Residential Construction
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Current FICO score range:
700 and above		$22,194		$20,422		$9,826		$10,772		$292		$313
620 - 699	3,042		3,262		1,540		1,741		96		58
Below 620 ²	901		1,060		546		658		16		13
Total		$26,137		$24,744		$11,912		$13,171		$404		$384



	Consumer Loans ³
	Other Direct				Indirect				Credit Cards
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Current FICO score range:
700 and above		$7,008		$5,501		$7,642		$7,015		$974		$759
620 - 699	703		576		2,381		2,481		351		265
Below 620 ²	60		50		713		631		85		62
Total		$7,771		$6,127		$10,736		$10,127		$1,410		$1,086

¹Excludes $537 million and $629 million of guaranteed residential loans at December 31, 2016 and 2015, respectively.

²For substantially all loans with refreshed FICO scores below 620, the borrower’s FICO score at the time of origination exceeded 620 but has since deteriorated as the loan has seasoned.

³Excludes $6.2 billion and $4.9 billion of guaranteed student loans at December 31, 2016 and 2015, respectively.

The payment status for the LHFI portfolio is presented in the following tables:



	December 31, 2016
(Dollars in millions)	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing ²		Total
Commercial loans:
C&I		$68,776		$35		$12		$390		$69,213
CRE	4,988		1		—		7		4,996
Commercial construction	3,998		—		—		17		4,015
Total commercial loans	77,762		36		12		414		78,224
Residential loans:
Residential mortgages - guaranteed	155		55		327		—		537
Residential mortgages - nonguaranteed ¹	25,869		84		7		177		26,137
Residential home equity products	11,596		81		—		235		11,912
Residential construction	389		3		—		12		404
Total residential loans	38,009		223		334		424		38,990
Consumer loans:
Guaranteed student	4,637		603		927		—		6,167
Other direct	7,726		35		4		6		7,771
Indirect	10,608		126		1		1		10,736
Credit cards	1,388		12		10		—		1,410
Total consumer loans	24,359		776		942		7		26,084
Total LHFI		$140,130		$1,035		$1,288		$845		$143,298

¹Includes $222 million of loans measured at fair value, the majority of which were accruing current.

²Nonaccruing loans past due 90 days or more totaled $360 million. Nonaccruing loans past due fewer than 90 days include modified nonaccrual loans reported as TDRs, performing second lien loans where the first lien loan is nonperforming, and certain energy-related commercial loans.



	December 31, 2015
(Dollars in millions)	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing ²		Total
Commercial loans:
C&I		$66,670		$61		$23		$308		$67,062
CRE	6,222		3		—		11		6,236
Commercial construction	1,952		—		2		—		1,954
Total commercial loans	74,844		64		25		319		75,252
Residential loans:
Residential mortgages - guaranteed	192		59		378		—		629
Residential mortgages - nonguaranteed ¹	24,449		105		7		183		24,744
Residential home equity products	12,939		87		—		145		13,171
Residential construction	365		3		—		16		384
Total residential loans	37,945		254		385		344		38,928
Consumer loans:
Guaranteed student	3,861		500		561		—		4,922
Other direct	6,094		24		3		6		6,127
Indirect	10,022		102		—		3		10,127
Credit cards	1,070		9		7		—		1,086
Total consumer loans	21,047		635		571		9		22,262
Total LHFI		$133,836		$953		$981		$672		$136,442

¹Includes $257 million of loans measured at fair value, the majority of which were accruing current.

²Nonaccruing loans past due 90 days or more totaled $336 million. Nonaccruing loans past due fewer than 90 days include modified nonaccrual loans reported as TDRs and performing second lien loans where the first lien loan is nonperforming, and certain energy-related commercial loans.

Impaired Loans

A loan is considered impaired when it is probable that the Company will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the agreement. Commercial nonaccrual loans greater than $3 million and certain commercial, residential, and consumer loans whose terms have been modified in a TDR are individually evaluated for impairment. Smaller-balance homogeneous loans that are collectively evaluated for impairment and loans measured at fair value are not included in the following tables. Additionally, the following tables exclude guaranteed consumer student loans and guaranteed residential mortgages for which there was nominal risk of principal loss.



	December 31, 2016								December 31, 2015
(Dollars in millions)	Unpaid Principal Balance			Amortized Cost ¹			Related Allowance		Unpaid Principal Balance		Amortized Cost ¹		Related Allowance
Impaired loans with no related allowance recorded:
Commercial loans:
C&I		$266			$214			$—		$55		$42		$—
CRE	—			—			—		11		9		—
Total commercial loans	266			214			—		66		51		—
Residential loans:
Residential mortgages - nonguaranteed	466			360			—		500		380		—
Residential construction	16			8			—		29		8		—
Total residential loans	482			368			—		529		388		—

Impaired loans with an allowance recorded:
Commercial loans:
C&I	225			151			31		173		167		28
CRE	26			17			2		—		—		—
Total commercial loans	251			168			33		173		167		28
Residential loans:
Residential mortgages - nonguaranteed	1,277			1,248			150		1,381		1,344		178
Residential home equity products	863			795			54		740		670		60
Residential construction	109			107			11		127		125		14
Total residential loans	2,249			2,150			215		2,248		2,139		252
Consumer loans:
Other direct	59		²	59		²	1		11		11		1
Indirect	103			103			5		114		114		5
Credit cards	24			6			1		24		6		1
Total consumer loans	186			168			7		149		131		7
Total impaired loans		$3,434			$3,068			$255		$3,165		$2,876		$287

¹Amortized cost reflects charge-offs that have been recognized plus other amounts that have been applied to adjust the net book balance.

²Includes $41 million of TDRs that were modified prior to 2016 and reclassified as TDRs in the fourth quarter of 2016.

Included in the impaired loan balances above at December 31, 2016 and 2015 were $2.5 billion and $2.6 billion, respectively, of accruing TDRs at amortized cost, of which 97% were current. See Note 1, “Significant Accounting Policies,” for further information regarding the Company’s loan impairment policy.



	Year Ended December 31
	2016				2015				2014
(Dollars in millions)	Average Amortized Cost		Interest Income Recognized¹		Average Amortized Cost		Interest Income Recognized¹		Average Amortized Cost		Interest Income Recognized ¹
Impaired loans with no related allowance recorded:
Commercial loans:
C&I		$169		$3		$58		$2		$84		$1
CRE	—		—		10		—		11		1
Total commercial loans	169		3		68		2		95		2
Residential loans:
Residential mortgages - nonguaranteed	370		16		390		17		437		17
Residential construction	8		—		11		—		12		—
Total residential loans	378		16		401		17		449		17

Impaired loans with an allowance recorded:
Commercial loans:
C&I	170		1		147		5		16		1
CRE	25		1		—		—		5		—
Total commercial loans	195		2		147		5		21		1
Residential loans:
Residential mortgages - nonguaranteed	1,251		64		1,349		65		1,357		78
Residential home equity products	812		29		682		28		644		27
Residential construction	110		6		125		8		144		8
Total residential loans	2,173		99		2,156		101		2,145		113
Consumer loans:
Other direct	10		1		12		—		14		—
Indirect	114		6		125		6		113		5
Credit cards	6		1		7		1		10		1
Total consumer loans	130		8		144		7		137		6
Total impaired loans		$3,045		$128		$2,916		$132		$2,847		$139

¹Of the interest income recognized during the years ended December 31, 2016, 2015, and 2014, cash basis interest income was $4 million, $7 million, and $4 million respectively.

NPAs are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Nonaccrual/NPLs:
Commercial loans:
C&I		$390		$308
CRE	7		11
Commercial construction	17		—
Residential loans:
Residential mortgages - nonguaranteed	177		183
Residential home equity products	235		145
Residential construction	12		16
Consumer loans:
Other direct	6		6
Indirect	1		3
Total nonaccrual/NPLs ¹	845		672
OREO ²	60		56
Other repossessed assets	14		7
Total NPAs		$919		$735

¹ Nonaccruing restructured loans are included in total nonaccrual/NPLs.

² Does not include foreclosed real estate related to loans insured by the FHA or the VA. Proceeds due from the FHA and the VA are recorded as a receivable in other assets in the Consolidated Balance Sheets until the property is conveyed and the funds are received. The receivable related to proceeds due from the FHA or the VA totaled $50 million and $52 million at December 31, 2016 and 2015, respectively.

The Company's recorded investment of nonaccruing loans secured by residential real estate properties for which formal foreclosure proceedings are in process at December 31, 2016 and 2015 was $85 million and $112 million, respectively. The Company's recorded investment of accruing loans secured by residential real estate properties for which formal foreclosure proceedings are in process at December 31, 2016 and 2015 was $122 million and $152 million, of which $114 million and $141 million were insured by the FHA or the VA, respectively.

At December 31, 2016, OREO included $50 million of foreclosed residential real estate properties and $7 million of foreclosed commercial real estate properties, with the remainder related to land.

At December 31, 2015, OREO included $39 million of foreclosed residential real estate properties and $11 million of foreclosed commercial real estate properties, with the remainder related to land.

Restructured Loans

A TDR is a loan for which the Company has granted an economic concession to the borrower, in response to certain instances of financial difficulty experienced by the borrower, that the Company would not have considered otherwise. When a loan is modified under the terms of a TDR, the Company typically offers the borrower an extension of the loan maturity date and/or a reduction in the original contractual interest rate. In certain situations, the Company may offer to restructure a loan in a manner that ultimately results in the forgiveness of a contractually specified principal balance.

At December 31, 2016 and 2015, the Company had $29 million and $4 million, respectively, of commitments to lend additional funds to debtors whose terms have been modified in a TDR. The number and amortized cost of loans modified under the terms of a TDR, by type of modification, are presented in the following tables:



	2016 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	144		$—		$2		$134		$136
CRE	4	—		—		—		—
Commercial construction	1	—		—		—		—
Residential loans:
Residential mortgages - nonguaranteed	931	3		82		10		95
Residential home equity products	3,448	—		10		243		253
Residential construction	63	—		—		—		—
Consumer loans:
Other direct ³	4,021	—		—		50		50
Indirect	3,141	—		—		37		37
Credit cards	719	—		3		—		3
Total TDRs	12,472		$3		$97		$474		$574

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan may have had other concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2016 was immaterial.

³Includes 3,321 loans with an amortized cost of $41 million that were modified prior to 2016 and reclassified as TDRs in the fourth quarter of 2016.



	2015 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	79		$—		$1		$8		$9
CRE	1	—		—		—		—
Residential loans:
Residential mortgages - nonguaranteed	789	12		129		25		166
Residential home equity products	2,172	—		25		113		138
Residential construction	23	—		6		—		6
Consumer loans:
Other direct	66	—		—		1		1
Indirect	2,578	—		—		52		52
Credit cards	683	—		3		—		3
Total TDRs	6,391		$12		$164		$199		$375

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan may have had other concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2015 was $2 million.



	2014 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	78		$—		$1		$37		$38
CRE	6	4		—		3		7
Residential loans:
Residential mortgages - nonguaranteed	1,135	10		127		44		181
Home equity products	1,977	—		7		86		93
Residential construction	11	—		1		—		1
Consumer loans:
Other direct	71	—		—		1		1
Indirect	2,928	—		—		57		57
Credit cards	450	—		2		—		2
Total TDRs	6,656		$14		$138		$228		$380

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan typically have had multiple concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2014 was $14 million.

The following table presents TDRs that have defaulted during the year ended December 31, 2016 that were first modified within the previous 12 months.



	Year Ended December 31, 2016
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	22		$15
Residential loans:
Residential mortgages	55	11
Residential home equity products	137	10
Consumer loans:
Other direct	20	—
Indirect	117	1
Credit cards	97	—
Total TDRs	448		$37

The following table presents TDRs that have defaulted during the year ended December 31, 2015 that were first modified within the previous 12 months.



	Year Ended December 31, 2015
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	34		$1
Residential loans:
Residential mortgages	120	16
Residential home equity products	138	6
Consumer loans:
Other direct	5	—
Indirect	171	2
Credit cards	84	—
Total TDRs	552		$25

The following table presents TDRs that have defaulted during the year ended December 31, 2014 that were first modified within the previous 12 months.



	Year Ended December 31, 2014
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	78		$10
Residential loans:
Residential mortgages	158	19
Home equity products	101	5
Residential construction	6	—
Consumer loans:
Other direct	9	—
Indirect	181	1
Credit cards	145	1
Total TDRs	678		$36

The majority of loans that were modified and subsequently became 90 days or more delinquent have remained on nonaccrual status since the time of delinquency.

Concentrations of Credit Risk

The Company does not have a significant concentration of risk to any individual client except for the U.S. government and its agencies. However, a geographic concentration arises because the Company operates primarily within Florida, Georgia, Maryland, North Carolina, and Virginia. The Company engages in limited international banking activities. The Company’s total cross-border outstanding loans were $2.2 billion and $1.6 billion at December 31, 2016 and 2015, respectively.

With respect to collateral concentration, at December 31, 2016, the Company owned $39.0 billion in loans secured by residential real estate, representing 27% of total LHFI. Additionally, the Company had $10.3 billion in commitments to extend credit on home equity lines and $4.2 billion in residential mortgage loan commitments outstanding at December 31, 2016. At December 31, 2015, the Company owned $38.9 billion in loans secured by residential real estate, representing 29% of total LHFI, and had $10.5 billion in commitments to extend credit on home equity lines and $3.2 billion in residential mortgage loan commitments outstanding. At December 31, 2016 and December 31, 2015, 1% and 2% of residential loans owned were guaranteed by a federal agency or a GSE, respectively.

The following table presents loans in the residential mortgage portfolio that included a high original LTV ratio (in excess of 80%), an interest only feature, and/or a second lien position that may increase the Company's exposure to credit risk and result in a concentration of credit risk. At December 31, 2016 and December 31, 2015, the current weighted average FICO score for the borrowers of these loans was 751 and 745, respectively.



(Dollars in millions)	December 31, 2016		December 31, 2015
Interest only mortgages with MI or with combined original LTV ≤ 80%¹		$845		$1,563
Interest only mortgages with no MI and with combined original LTV > 80%¹	279		547
Total interest only mortgages ¹	1,124		2,110
Amortizing mortgages with combined original LTV > 80% and/or second liens ²	9,198		8,366
Total mortgages with potential concentration of credit risk		$10,322		$10,476

¹Comprised of first and/or second liens, primarily with an initial 10 year interest only period.

²Comprised of loans with no MI.

Allowance for Credit Losses

NOTE 7 - ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses consists of the ALLL and the unfunded commitments reserve. Activity in the allowance for credit losses is summarized in the following table:



	Year Ended December 31
(Dollars in millions)	2016			2015			2014
Balance, beginning of period		$1,815			$1,991			$2,094
Provision for loan losses	440			156			338
Provision for unfunded commitments	4			9			4
Loan charge-offs	(591		)	(470		)	(607		)
Loan recoveries	108			129			162
Balance, end of period		$1,776			$1,815			$1,991

Components:
ALLL		$1,709			$1,752			$1,937
Unfunded commitments reserve ¹	67			63			54
Allowance for credit losses		$1,776			$1,815			$1,991

¹The unfunded commitments reserve is recorded in other liabilities in the Consolidated Balance Sheets.

Activity in the ALLL by loan segment is presented in the following tables:



	Year Ended December 31, 2016
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance, beginning of period		$1,047			$534			$171			$1,752
Provision/(benefit) for loan losses	329			(59		)	170			440
Loan charge-offs	(287		)	(136		)	(168		)	(591		)
Loan recoveries	35			30			43			108
Balance, end of period		$1,124			$369			$216			$1,709

	Year Ended December 31, 2015
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance, beginning of period		$986			$777			$174			$1,937
Provision/(benefit) for loan losses	133			(67		)	90			156
Loan charge-offs	(117		)	(218		)	(135		)	(470		)
Loan recoveries	45			42			42			129
Balance, end of period		$1,047			$534			$171			$1,752

As discussed in Note 1, “Significant Accounting Policies,” the ALLL is composed of both specific allowances for certain nonaccrual loans and TDRs and general allowances for groups of loans with similar risk characteristics. No allowance is required for loans measured at fair value. Additionally, the Company records an immaterial allowance for loan products that are guaranteed by government agencies, as there is nominal risk of principal loss.

The Company’s LHFI portfolio and related ALLL is presented in the following tables:



	December 31, 2016
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL
Individually evaluated		$382		$33		$2,518		$215		$168		$7		$3,068		$255
Collectively evaluated	77,842		1,091		36,250		154		25,916		209		140,008		1,454
Total evaluated	78,224		1,124		38,768		369		26,084		216		143,076		1,709
LHFI at fair value	—		—		222		—		—		—		222		—
Total LHFI		$78,224		$1,124		$38,990		$369		$26,084		$216		$143,298		$1,709



	December 31, 2015
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL
Individually evaluated		$218		$28		$2,527		$252		$131		$7		$2,876		$287
Collectively evaluated	75,034		1,019		36,144		282		22,131		164		133,309		1,465
Total evaluated	75,252		1,047		38,671		534		22,262		171		136,185		1,752
LHFI at fair value	—		—		257		—		—		—		257		—
Total LHFI		$75,252		$1,047		$38,928		$534		$22,262		$171		$136,442		$1,752

Premises and Equipment Property Plant And Equipment (Notes)

Property, Plant and Equipment Disclosure [Text Block]

NOTE 8 - PREMISES AND EQUIPMENT

Premises and equipment at December 31 consisted of the following:



(Dollars in millions)	Useful Life (in years)	2016		2015
Land	Indefinite		$320		$330
Buildings and improvements	1 - 40	1,028		1,073
Leasehold improvements	1 - 30	645		636
Furniture and equipment	1 - 20	1,492		1,463
Construction in progress		357		249
Total premises and equipment		3,842		3,751
Less: Accumulated depreciation and amortization		2,286		2,249
Premises and equipment, net			$1,556		$1,502

None of the Company's premises and equipment was subject to mortgage indebtedness (included in long-term debt) at December 31, 2016 and 2015. Net capital leases included in net premises and equipment was immaterial at both December 31, 2016 and 2015. Aggregate rent expense (principally for offices), including any contingent rent expense and sublease income, totaled $202 million, $200 million, and $206 million for the years ended December 31, 2016, 2015, and 2014, respectively. Depreciation and amortization expense on premises and equipment for the years ended December 31, 2016, 2015, and 2014 totaled $179 million, $175 million, and $176 million, respectively.

The Company previously completed sale-leaseback transactions consisting of branch properties and various individual office buildings. Upon completion of these transactions, the Company recognized a portion of the resulting gains and deferred the remainder to be recognized ratably over the expected term of the lease, predominantly 10 years, as an offset to net occupancy expense. To the extent that terms on these leases are extended, the remaining deferred gain would be amortized over the new lease term. Amortization of deferred gains on sale-leaseback transactions was $43 million, $54 million, and $53 million for the years ended December 31, 2016, 2015, and 2014, respectively. At December 31, 2016 and 2015, the remaining deferred gain associated with sale-leaseback transactions was $67 million and $108 million, respectively.

The Company has various obligations under capital leases and noncancelable operating leases for premises and equipment. The leases predominantly expire over the next 13 years, with the longest expiring in 2081. Many of these leases provide for periodic adjustment of rentals based on changes in various economic indicators, while others also include a renewal option.

The following table presents future minimum payments under noncancelable operating leases, net of sublease rentals, with initial terms in excess of one year at December 31, 2016.



(Dollars in millions)	Operating Leases
2017		$205
2018	193
2019	179
2020	159
2021	148
Thereafter	727
Total minimum lease payments		$1,611

Goodwill and Other Intangible Assets

NOTE 9 – GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

The Company conducts a goodwill impairment test at the reporting unit level at least annually, or more frequently as events occur or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. See Note 1, "Significant Accounting Policies," for additional information regarding the Company's goodwill accounting policy.

The Company performed goodwill impairment analyses for its Wholesale Banking and Consumer Banking and Private Wealth Management reporting units as of October 1, 2016, October 1, 2015, and September 30, 2015. Based on the results of the impairment analyses, the Company concluded that the fair values of the reporting units exceed their respective carrying values; therefore, there was no goodwill impairment. The Company monitored events and circumstances during the fourth quarter of 2016 and did not observe any factors that would more-likely-than-not reduce the fair value of a reporting unit below its respective carrying value.

There were no material changes in the carrying amount of goodwill by reportable segment for the year ended December 31, 2016, as presented in the following table. There were no changes in the carrying amount of goodwill by reportable segment for the year ended December 31, 2015.



(Dollars in millions)	Consumer Banking and Private Wealth Management		Wholesale Banking		Total
Balance, January 1, 2016		$4,262		$2,075		$6,337
Acquisition of Pillar	—		—		—
Balance, December 31, 2016		$4,262		$2,075		$6,337

Other Intangible Assets

Changes in the carrying amounts of other intangible assets for the years ended December 31 are presented in the following table:



(Dollars in millions)	MSRs - Fair Value			Other			Total
Balance, January 1, 2016		$1,307			$18			$1,325
Amortization ¹	—			(9		)	(9		)
Servicing rights originated	312			—			312
Servicing rights purchased	200			—			200
Servicing rights acquired in Pillar acquisition	—			62			62
Other intangible assets acquired in Pillar acquisition ²	—			14			14
Changes in fair value:
Due to changes in inputs and assumptions ³	(13		)	—			(13		)
Other changes in fair value ⁴	(232		)	—			(232		)
Servicing rights sold	(2		)	—			(2		)
Balance, December 31, 2016		$1,572			$85			$1,657

Balance, January 1, 2015		$1,206			$13			$1,219
Amortization ¹	—			(8		)	(8		)
Servicing rights originated	238			13			251
Servicing rights purchased	109			—			109
Changes in fair value:
Due to changes in inputs and assumptions ³	(32		)	—			(32		)
Other changes in fair value ⁴	(210		)	—			(210		)
Servicing rights sold	(4		)	—			(4		)
Balance, December 31, 2015		$1,307			$18			$1,325

¹ Does not include expense associated with non-qualified community development investments. See Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," for additional information.

² The majority of these other intangible assets acquired from Pillar relate to indefinite-lived agency licenses. See Note 2, "Acquisitions/Dispositions," for additional information.

³ Primarily reflects changes in option adjusted spreads and prepayment speed assumptions, due to changes in interest rates.

⁴ Represents changes due to the collection of expected cash flows, net of accretion due to the passage of time.

The Company's estimated future amortization of intangible assets at December 31, 2016 is presented in the following table:



(Dollars in millions)
2017		$15
2018	12
2019	9
2020	9
2021	7
Thereafter	23
Total ¹		$75

¹ Does not include indefinite-lived intangible assets of $10 million.

Servicing Rights

The Company acquires servicing rights and retains servicing rights for certain of its sales or securitizations of residential mortgage, consumer indirect, and commercial loans. MSRs on residential mortgage loans and servicing rights on commercial and consumer indirect loans are the only servicing assets capitalized by the Company and are classified within other intangible assets on the Company's Consolidated Balance Sheets.

Residential Mortgage Servicing Rights

Income earned by the Company on its residential MSRs is derived primarily from contractually specified mortgage servicing fees and late fees, net of curtailment costs. Such income earned for the years ended December 31, 2016, 2015, and 2014 was $366 million, $347 million, and $329 million, respectively. These amounts are reported in mortgage servicing related income in the Consolidated Statements of Income.

At December 31, 2016 and 2015, the total UPB of residential mortgage loans serviced was $160.2 billion and $148.2 billion, respectively. Included in these amounts were $129.6 billion and $121.0 billion at December 31, 2016 and 2015, respectively, of loans serviced for third parties. The Company purchased MSRs on residential loans with a UPB of $19.7 billion during the year ended December 31, 2016, $13.8 billion of which are reflected in the UPB amounts above and the transfer of servicing for the majority of the remainder is scheduled for the first quarter of 2017. The Company purchased MSRs on residential loans with a UPB of $10.3 billion during the year ended December 31, 2015. During the years ended December 31, 2016 and 2015, the Company sold MSRs on residential loans, at a price approximating their fair value, with a UPB of $575 million and $803 million, respectively.

The Company measures the fair value of its residential MSRs using a valuation model that calculates the present value of estimated future net servicing income using prepayment projections, spreads, and other assumptions. Senior management and the STM valuation committee review all significant assumptions at least quarterly, comparing these inputs to various sources of market data. Changes to valuation model inputs are reflected in the periods' results. See Note 18, “Fair Value Election and Measurement,” for further information regarding the Company's MSR valuation methodology.

A summary of the key inputs used to estimate the fair value of the Company’s residential MSRs at December 31, 2016 and 2015, and the sensitivity of the fair values to immediate 10% and 20% adverse changes in those inputs, are presented in the following table.



(Dollars in millions)	December 31, 2016			December 31, 2015
Fair value of MSRs		$1,572			$1,307
Prepayment rate assumption (annual)	9		%	10		%
Decline in fair value from 10% adverse change		$50			$49
Decline in fair value from 20% adverse change	97			94
Option adjusted spread (annual)	8		%	8		%
Decline in fair value from 10% adverse change		$63			$64
Decline in fair value from 20% adverse change	122			123
Weighted-average life (in years)	7.0			6.6
Weighted-average coupon	4.0		%	4.1		%

These residential MSR sensitivities are hypothetical and should be used with caution. Changes in fair value based on variations in assumptions generally cannot be extrapolated because (i) the relationship of the change in an assumption to the change in fair value may not be linear and (ii) changes in one assumption may result in changes in another, which might magnify or counteract the sensitivities. The sensitivities do not reflect the effect of hedging activity undertaken by the Company to offset changes in the fair value of MSRs. See Note 17, “Derivative Financial Instruments,” for further information regarding these hedging activities.

Consumer Loan Servicing Rights

In June 2015, the Company completed the securitization of $1.0 billion of indirect auto loans, with servicing rights retained, and recognized a $13 million servicing asset at the time of sale. See Note 10, “Certain Transfers of Financial Assets and Variable Interest Entities,” for additional information on the Company's securitization transactions.

Income earned by the Company on its consumer loan servicing rights is derived primarily from contractually specified servicing fees and other ancillary fees. Such income earned for the years ended December 31, 2016 and 2015 was $7 million and $5 million, respectively, and is reported in other noninterest income in the Consolidated Statements of Income. There was no income earned on consumer loan servicing rights for the year ended December 31, 2014.

At December 31, 2016 and 2015, the total UPB of consumer indirect loans serviced for third parties was $512 million and $807 million, respectively. No consumer loan servicing rights were purchased or sold during the years ended December 31, 2016 and 2015.

Consumer loan servicing rights are accounted for at amortized cost and are monitored for impairment on an ongoing basis. The Company calculates the fair value of consumer servicing rights using a valuation model that calculates the present value of estimated future net servicing income considering prepayment projections and other assumptions. Impairment, if any, is recognized when changes in valuation model inputs reflect a fair value for the servicing asset that is below its respective carrying value. At December 31, 2016 and 2015, the amortized cost of the Company's consumer loan servicing rights was $4 million and $9 million, respectively.

Commercial Mortgage Servicing Rights

In December 2016, the Company completed the acquisition of substantially all of the assets of the operating subsidiaries of Pillar, and as a result, the Company recognized a $62 million servicing asset. See Note 2, "Acquisitions/Dispositions," for additional information on the Pillar acquisition.

Income earned by the Company on its commercial mortgage servicing rights is derived primarily from contractually specified servicing fees and other ancillary fees. Such income earned for the year ended December 31, 2016 was immaterial and is reported in other noninterest income in the Consolidated Statements of Income. There was no income earned on commercial mortgage servicing rights for the years ended December 31, 2015 and 2014.

At December 31, 2016, the total UPB of commercial mortgage loans serviced for third parties was $4.8 billion. No commercial mortgage servicing rights were purchased or sold during the years ended December 31, 2016 and 2015 (other than those that were acquired as part of the Pillar acquisition).

Commercial mortgage servicing rights are accounted for at amortized cost and are monitored for impairment on an ongoing basis. The Company calculates the fair value of commercial servicing rights using a third party valuation model that calculates the present value of estimated future net servicing income, considering prepayment projections and other assumptions. Impairment, if any, is recognized when the carrying value of the servicing asset exceeds the fair value at the measurement date. At December 31, 2016, the amortized cost and weighted average amortization period of the Company's commercial mortgage servicing rights were $62 million and 7.0 years, respectively.

Borrowings and Contractual Commitments (Notes)

Debt Disclosure [Text Block]

NOTE 11 - BORROWINGS AND CONTRACTUAL COMMITMENTS

Other short-term borrowings

Other short-term borrowings at December 31 consisted of the following:



	2016				2015
(Dollars in millions)	Balance		Interest Rate		Balance		Interest Rate
Master notes		$483	0.25	%		$582	0.20	%
Dealer collateral	451		0.55		442		0.20
Other	81		2.28		—		—
Total other short-term borrowings		$1,015				$1,024

Long-term debt

Long-term debt at December 31 consisted of the following:



	2016				2015
(Dollars in millions)	Maturity Date(s)	Interest Rate(s)	Balance		Balance
Parent Company Only:
Senior, fixed rate	2017 - 2028	2.35% - 6.00%		$3,818		$3,614
Senior, variable rate	2017 - 2026	0.25 - 2.50	314		331
Subordinated, fixed rate	2026	6.00	200		200
Junior subordinated, variable rate	2027 - 2028	1.58 - 1.83	627		627
Total			4,959		4,772
Less: Debt issuance costs ¹			9
Total Parent Company debt			4,950		4,772
Subsidiaries ²:
Senior, fixed rate ³	2017 - 2053	0.80 - 9.27	2,539		1,620
Senior, variable rate	2017 - 2043	0.61 - 2.27	2,613		1,097
Subordinated, fixed rate ⁴	2017 - 2026	3.30 - 7.25	1,651		973
Total			6,803		3,690
Less: Debt issuance costs ¹			5
Total subsidiaries debt			6,798		3,690

Total long-term debt				$11,748		$8,462

¹Related to the Company's adoption of ASU 2015-03. Debt issuance costs were immaterial in the comparative prior year period, and accordingly, were not reclassified from other assets to long-term debt. See Note 1, "Significant Accounting Policies," for additional information.

²88% and 81% of total subsidiary debt was issued by the Bank as of December 31, 2016 and 2015, respectively.

³Includes leases and other obligations that do not have a stated interest rate.

⁴Includes $963 million and $973 million of subordinated debt measured at fair value at December 31, 2016 and 2015, respectively.

The Company had no foreign denominated debt outstanding at December 31, 2016 or 2015. Maturities of long-term debt at December 31, 2016 were as follows:



(Dollars in millions)	Parent Company		Subsidiaries
2017		$482		$1,305
2018	874		1,237
2019	792		27
2020	—		1,721
2021	969		505
Thereafter	1,842		2,008
Total maturities	4,959		6,803
Less: Debt issuance costs	9		5
Total long-term debt		$4,950		$6,798

During 2016, the Bank (i) issued $1.0 billion of 5-year fixed rate senior notes and used the proceeds to pay off $1.0 billion of higher cost, fixed rate senior notes that were due in 2016, (ii) issued $1.0 billion of 5-year fixed rate senior notes and used the proceeds to pay off $750 million of higher cost, fixed rate senior notes that were due in 2017, (iii) added $3.8 billion of long-term FHLB advances and, (iv) issued $750 million of 10-year fixed rate subordinated notes. Furthermore, $1.4 billion of the Bank's long-term FHLB advances were terminated. The Company had no additional material issuances, advances, repurchases, terminations, or extinguishments of long-term debt during the year.

Restrictive provisions of several long-term debt agreements prevent the Company from creating liens on, disposing of, or issuing (except to related parties) voting stock of subsidiaries. Furthermore, there are restrictions on mergers, consolidations, certain leases, sales or transfers of assets, minimum shareholders’ equity, and maximum borrowings by the Company. At December 31, 2016, the Company was in compliance with all covenants and provisions of long-term debt agreements.

As currently defined by federal bank regulators, long-term debt of $1.7 billion and $1.0 billion qualified as Tier 2 capital at December 31, 2016 and 2015, respectively, and $157 million qualified as Tier 1 capital at December 31, 2015. Beginning January 1, 2016, the long-term debt that qualified as Tier 1 capital at December 31, 2015 has been completely phased-out of Tier 1 capital and is classified as Tier 2 capital, using the methodology specified under Basel III. See Note 13, "Capital," for additional information regarding regulatory capital adequacy requirements for the Company and the Bank.

The Company does not consolidate certain wholly-owned trusts which were formed for the sole purpose of issuing trust preferred securities. The proceeds from the trust preferred securities issuances were invested in junior subordinated debentures of the Parent Company. The obligations of these debentures constitute a full and unconditional guarantee by the Parent Company of the trust preferred securities.

Contractual Commitments

In the normal course of business, the Company enters into certain contractual commitments. These commitments include obligations to make future payments on the Company's borrowings, partnership investments, and lease arrangements, as well as commitments to lend to clients and to fund capital expenditures and service contracts.

The following table presents the Company's significant contractual commitments at December 31, 2016, except for long-term debt and short-term borrowings, operating leases, and pension and other postretirement benefit plans. Information on those obligations is included above, in Note 8, "Premises and Equipment," and in Note 15, "Employee Benefit Plans." Capital lease obligations were immaterial at December 31, 2016 and are not presented in the table.



	Payments Due by Period
(Dollars in millions)	2017		2018		2019		2020		2021		Thereafter		Total
Unfunded lending commitments		$26,057		$8,786		$13,727		$16,439		$14,568		$11,994		$91,571
Purchase obligations ¹	497		22		20		14		12		219		784
Consumer and other time deposits ^{2, 3}	3,893		1,794		1,082		983		603		1,112		9,467
Brokered time deposits ³	161		102		175		232		131		123		924
Foreign time deposits ³	610		—		—		—		—		—		610
Commitments to fund partnership investments ⁴	563		—		—		—		—		—		563

¹ For legally binding purchase obligations of $5 million or more, amounts include either termination fees under the associated contracts when early termination provisions exist, or the total potential obligation over the full contractual term for noncancelable purchase obligations. Payments made towards the purchase of goods or services under these contracts totaled $236 million, $243 million, and $223 million in 2016, 2015, and 2014, respectively.

² The aggregate amount of time deposit accounts in denominations of $250,000 or more totaled $1.7 billion and $1.4 billion at December 31, 2016 and 2015, respectively.

³ Amounts do not include interest.

⁴ Commitments to fund investments in affordable housing and other partnerships do not have defined funding dates as certain criteria must be met before the Company is obligated to fund. Accordingly, these commitments are considered to be due on demand for presentation purposes. See Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," in this Form 10-K for additional information.

Certain Transfers of Financial Assets and Variable Interest Entities

Transfers and Servicing of Financial Assets [Text Block]

NOTE 10 - CERTAIN TRANSFERS OF FINANCIAL ASSETS AND VARIABLE INTEREST ENTITIES

The Company has transferred loans and securities in sale or securitization transactions for which the Company retains certain beneficial interests, servicing rights, and/or recourse for Fannie Mae commercial mortgage loan sales. These transfers of financial assets include certain residential mortgage loans, commercial and corporate loans, and consumer loans, as discussed in the following section, "Transfers of Financial Assets." Cash receipts on beneficial interests held related to these transfers were $12 million, $19 million, and $21 million for the years ended December 31, 2016, 2015, and 2014, respectively. The servicing fees related to these asset transfers (excluding servicing fees for residential mortgage loan transfers to GSEs, which are discussed in Note 9, “Goodwill and Other Intangible Assets”) were immaterial for each of the years ended December 31, 2016, 2015, and 2014.

When a transfer or other transaction occurs with a VIE, the Company first determines whether it has a VI in the VIE. A VI is typically in the form of securities representing retained interests in transferred assets and, at times, servicing rights and/or collateral management fees, and for commercial mortgage loans sold to Fannie Mae, the loss share guarantee. When determining whether to consolidate the VIE, the Company evaluates whether it is a primary beneficiary which has both (i) the power to direct the activities that most significantly impact the economic performance of the VIE, and (ii) the obligation to absorb losses, or the right to receive benefits, that could potentially be significant to the VIE.

To determine whether a transfer should be accounted for as a sale or a secured borrowing, the Company evaluates whether: (i) the transferred assets are legally isolated, (ii) the transferee has the right to pledge or exchange the transferred assets, and (iii) the Company has relinquished effective control of the transferred assets. If all three conditions are met, then the transfer is accounted for as a sale.

Except as specifically noted herein, the Company is not required to provide additional financial support to any of the entities to which the Company has transferred financial assets, nor has the Company provided any support it was not otherwise obligated to provide. No events occurred during the year ended December 31, 2016 that changed the Company’s previous conclusions regarding whether it is the primary beneficiary of the VIEs described herein. Furthermore, no events occurred during the year ended December 31, 2016 that changed the Company’s sale conclusion with regards to previously transferred residential mortgage loans, indirect auto loans, student loans, or commercial and corporate loans.

Transfers of Financial Assets

The following discussion summarizes transfers of financial assets to entities for which the Company has retained some level of continuing involvement.

Residential Mortgage Loans

The Company typically transfers first lien residential mortgage loans in conjunction with Ginnie Mae, Fannie Mae, and Freddie Mac securitization transactions, whereby the loans are exchanged for cash or securities that are readily redeemable for cash, and servicing rights are retained.

The Company sold residential mortgage loans to Ginnie Mae, Fannie Mae, and Freddie Mac, which resulted in pre-tax net gains of $331 million, $232 million, and $224 million for the years ended December 31, 2016, 2015, and 2014, respectively. The Company has made certain representations and warranties with respect to the transfer of these loans. See Note 16, “Guarantees,” for additional information regarding representations and warranties.

In a limited number of securitizations, the Company has received securities in addition to cash in exchange for the transferred loans, while also retaining servicing rights. The securities received are measured at fair value and classified as securities AFS. At December 31, 2016 and 2015, the fair value of securities received totaled $30 million and $38 million, respectively.

The Company evaluates securitization entities in which it has a VI for potential consolidation under the VIE consolidation model. Notwithstanding the Company's role as servicer, the Company typically does not have power over the securitization entities as a result of rights held by the master servicer. In certain transactions, the Company does have power as the servicer, but does not have an obligation to absorb losses, or the right to receive benefits, that could potentially be significant. In all such cases, the Company does not consolidate the securitization entity. Total assets of the unconsolidated entities in which the Company has a VI were $203 million and $241 million at December 31, 2016 and 2015, respectively.

The Company’s maximum exposure to loss related to these unconsolidated residential mortgage loan securitizations is comprised of the loss of value of any interests it retains, which was $30 million and $37 million at December 31, 2016 and 2015, respectively, and any repurchase obligations or other losses it incurs as a result of any guarantees related to these securitizations, which is discussed further in Note 16, “Guarantees.”

Commercial and Corporate Loans

In connection with the Pillar acquisition completed in December 2016, the Company acquired licenses and approvals to originate and sell certain commercial mortgage loans to Fannie Mae and Freddie Mac, to originate FHA insured loans, and to issue and sell Ginnie Mae commercial MBS backed by FHA insured loans. During 2016, the Company transferred $19 million in commercial loans to securitization entities sponsored by these agencies, with no associated gain or loss recognized. The loans are exchanged for cash or securities that are readily redeemable for cash, with servicing rights retained. The Company did not retain any debt or equity interests in the securitization entities and the fees received for servicing do not represent a VI; therefore, the Company does not consolidate the securitization entities. The Company has made certain representations and warranties with respect to the transfer of these loans and has entered into a loss share guarantee related to certain loans transferred to Fannie Mae. See Note 16, “Guarantees,” for additional information regarding the commercial mortgage loan loss share guarantee.

The Company holds CLOs issued by securitization entities that own commercial leveraged loans and bonds, certain of which were transferred to the entities by the Company. The Company has determined that these entities are VIEs and that it is not the primary beneficiary of these entities because it does not possess the power to direct the activities that most significantly impact the economic performance of the entities. Total assets at December 31, 2016 and 2015, of unconsolidated entities in which the Company has a VI were $185 million and $525 million, respectively. Total liabilities at December 31, 2016 and 2015, of unconsolidated entities in which the Company has a VI were $159 million and $482 million, respectively. The Company's holdings, which represents its maximum exposure to loss, was an immaterial amount of preference share exposure at December 31, 2016, and immaterial amounts of preference share exposure and senior debt exposure at December 31, 2015.

Consumer Loans

Guaranteed Student Loans

The Company has securitized government-guaranteed student loans through a transfer of loans to a securitization entity and retained the residual interest in the entity. The Company concluded that this entity should be consolidated because the Company has (i) the power to direct the activities that most significantly impact the economic performance of the VIE and (ii) the obligation to absorb losses, and the right to receive benefits, that could potentially be significant. At December 31, 2016 and 2015, the Company’s Consolidated Balance Sheets reflected $225 million and $262 million of assets held by the securitization entity and $222 million and $259 million of debt issued by the entity, respectively.

To the extent that the securitization entity incurs losses on its assets, the securitization entity has recourse to the guarantor of the underlying loan, which is backed by the Department of Education up to a maximum guarantee of 100%. When not fully guaranteed, losses reduce the amount of available cash payable to the Company as the owner of the residual interest. To the extent that losses result from a breach of servicing responsibilities, the Company, which functions as the master servicer, may be required to repurchase the defaulting loan(s) at par value. If the breach was caused by the subservicer, the Company would seek reimbursement from the subservicer up to the guaranteed amount. The Company’s maximum exposure to loss related to the securitization entity would arise from a breach of its servicing responsibilities. To date, loss claims filed with the guarantor that have been denied due to servicing errors have either been, or are in the process of, being cured, or reimbursement has been provided to the Company by the subservicer, or in limited cases, absorbed by the Company.

Indirect Auto Loans

In June 2015, the Company transferred indirect auto loans to a securitization entity, which was determined to be a VIE, and accounted for the transfer as a sale. The Company retained servicing rights for the transferred loans, but did not retain any debt or equity interest in the securitization entity. The fees received for servicing do not represent a VI and, therefore, the Company does not consolidate the securitization entity.

At the time of the transfer, the UPB of the transferred loans was $1.0 billion and the consideration received was $1.0 billion, resulting in an immaterial pre-tax loss for the year ended December 31, 2015, which was recorded in other noninterest income in the Consolidated Statements of Income. See Note 9, "Goodwill and Other Intangible Assets," for additional information regarding the servicing asset recognized in this transaction.

To the extent that losses on the transferred loans are the result of a breach of representations and warranties related to either the initial transfer or the Company's ongoing servicing responsibilities, the Company may be obligated to either cure the breach or repurchase the affected loans. The Company’s maximum exposure to loss related to the loans transferred to the securitization entity would arise from a breach of representations and warranties and/or a breach of the Company's servicing obligations. Potential losses suffered by the securitization entity that the Company may be liable for are limited to approximately $512 million, which is the total remaining UPB of transferred loans and the carrying value of the servicing asset.

The Company's total managed loans, including the LHFI portfolio and other transferred loans (securitized and unsecuritized), are presented in the following table by portfolio balance and delinquency status (accruing loans 90 days or more past due and all nonaccrual loans) at December 31, 2016 and 2015, as well as the related net charge-offs for the years ended December 31, 2016 and 2015.



	Portfolio Balance				Past Due and Nonaccrual				Net Charge-offs
	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		Year Ended December 31
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		2016			2015
LHFI portfolio:
Commercial		$78,224		$75,252		$426		$344		$252			$72
Residential	38,990		38,928		758		729		106			176
Consumer	26,084		22,262		949		580		125			93
Total LHFI portfolio	143,298		136,442		2,133		1,653		483			341
Managed securitized loans ¹:
Commercial ²	4,761		—		—		—		—			—
Residential	126,641		116,990		114		126		8		³	12		³
Consumer	512		807		1		1		3			2
Total managed securitized loans	131,914		117,797		115		127		11			14
Managed unsecuritized loans ⁴	2,985		3,973		438		597		—			—
Total managed loans		$278,197		$258,212		$2,686		$2,377		$494			$355

¹ Excludes loans that have completed the foreclosure or short sale process (i.e., involuntary prepayments).

² Comprised of commercial mortgages sold by Pillar through Fannie Mae, Freddie Mac, and Ginnie Mae securitizations, whereby servicing has been retained by the Company.

³ Net charge-offs are associated with $410 million and $501 million of managed securitized residential loans at December 31, 2016 and 2015, respectively. Net charge-off data is not reported to the Company for the remaining balance of $126.2 billion and $116.5 billion of managed securitized residential loans at December 31, 2016 and 2015, respectively.

⁴ Comprised of unsecuritized residential loans the Company originated and sold to private investors with servicing rights retained. Net charge-offs on these loans are not presented in the table as the data is not reported to the Company by the private investors that own these related loans.

Other Variable Interest Entities

In addition to exposure to VIEs arising from transfers of financial assets, the Company also has involvement with VIEs from other business activities.

Total Return Swaps

The Company facilitates matched book TRS transactions on behalf of clients, whereby a VIE purchases reference assets identified by a client and the Company enters into a TRS with the VIE, with a mirror-image TRS facing the client. The TRS contract between the VIE and the Company hedges the Company's exposure to the TRS contract with its third party client. The Company provides senior financing to the VIE, in the form of demand notes to fund the purchase of the reference assets. The TRS contracts pass through interest and other cash flows on the reference assets to the third party clients, along with exposing those clients to decreases in value on the assets and providing them with the rights to appreciation on the assets. The terms of the TRS contracts require the third parties to post initial margin collateral, in addition to ongoing margin as the fair values of the underlying reference assets change.

The Company evaluated the related VIEs for consolidation, noting that the Company and its third party clients are VI holders. The Company evaluated the nature of all VIs and other interests and involvement with the VIEs, in addition to the purpose and design of the VIEs, relative to the risks they were designed to create. The VIEs were designed for the benefit of the third parties and would not exist if the Company did not enter into the TRS contracts on their behalf. The activities of the VIEs are restricted to buying and selling the reference assets and the risks/benefits of any such assets owned by the VIEs are passed to the third party clients via the TRS contracts. The Company determined that it is not the primary beneficiary of the VIEs, as the design of its matched book TRS business results in the Company having no substantive power to direct the significant activities of the VIEs, and therefore, the VIEs are not consolidated.

The outstanding notional amounts of the Company's VIE-facing TRS contracts and related senior financing outstanding to VIEs were $2.1 billion and $2.2 billion at December 31, 2016 and 2015, respectively. These financings were measured at fair value and classified within trading assets and derivative instruments on the Consolidated Balance Sheets. The Company entered into client-facing TRS contracts of the same outstanding notional amounts. The notional amounts of the TRS contracts with VIEs represent the Company’s maximum exposure to loss, although this exposure has been mitigated via the TRS contracts with third party clients. For additional information on the Company’s TRS contracts and its involvement with these VIEs, see Note 17, “Derivative Financial Instruments.”

Community Development Investments

As part of its community reinvestment initiatives, the Company invests in multi-family affordable housing developments and other community development entities as a limited and/or general partner and/or a debt provider. The Company receives tax credits for its limited partner investments. The Company has determined that the vast majority of the related partnerships are VIEs.

In limited circumstances, the Company owns both the limited partner and general partner interests, in which case the related partnerships are not considered VIEs and are consolidated by the Company. One property was sold during the year ended December 31, 2016 for an immaterial gain, and the remaining properties held for sale at December 31, 2016 were immaterial. During the year ended December 31, 2015, properties with a carrying value of $72 million were sold for gains of $19 million. One property was sold during the year ended December 31, 2014 for an immaterial gain.

The Company has concluded that it is not the primary beneficiary of affordable housing partnerships when it invests as a limited partner and there is a third party general partner. The investments are accounted for in accordance with the accounting guidance for investments in affordable housing projects. The general partner, or an affiliate of the general partner, often provides guarantees to the limited partner, which protects the Company from construction and operating losses and tax credit allocation deficits. Assets of $1.7 billion and $1.6 billion in these and other community development partnerships were not included in the Consolidated Balance Sheets at December 31, 2016 and 2015, respectively. The Company's limited partner interests had carrying values of $780 million and $672 million at December 31, 2016 and 2015, respectively, and are recorded in other assets on the Company’s Consolidated Balance Sheets. The Company’s maximum exposure to loss for these investments totaled $1.1 billion at both December 31, 2016 and 2015. The Company’s maximum exposure to loss would result from the loss of its limited partner investments along with $306 million and $268 million of loans, interest-rate swap fair value exposures, or letters of credit issued by the Company to the entities at December 31, 2016 and 2015, respectively. The remaining exposure to loss is primarily attributable to unfunded equity commitments that the Company is required to fund if certain conditions are met.

The Company also owns noncontrolling interests in funds whose purpose is to invest in community developments. At December 31, 2016 and 2015, the Company's investment in these funds totaled $200 million and $132 million, respectively. The Company's maximum exposure to loss on its investment in these funds is comprised of its equity investments in the funds, loans issued, and any additional unfunded equity commitments, which totaled $562 million and $321 million at December 31, 2016 and 2015, respectively.

During the years ended December 31, 2016, 2015, and 2014, the Company recognized $92 million, $68 million, and $66 million of tax credits for qualified affordable housing projects, and $87 million, $66 million, and $61 million of amortization on these qualified affordable housing projects, respectively. These tax credits and amortization, net of the related tax benefits, are recorded in the provision for income taxes.

Certain of the Company's community development investments do not qualify as affordable housing projects for accounting purposes. The Company recognized tax credits for these investments of $64 million, $53 million, and $33 million during the years ended December 31, 2016, 2015, and 2014, respectively, in the provision for income taxes. Amortization on these investments totaled $46 million and $35 million during the years ended December 31, 2016 and 2015, respectively, recognized in amortization in the Company's Consolidated Statements of Income. During the year ended December 31, 2014, the Company recognized $19 million of amortization related to these non-qualified investments ($5 million of which was recorded within other noninterest expense and $14 million was recorded within amortization in the Company's Consolidated Statements of Income).

Net Income Per Common Share

Net Income/(Loss) Per Share

NOTE 12 – NET INCOME PER COMMON SHARE

Equivalent shares of 1 million, 14 million, and 15 million related to common stock options and common stock warrants outstanding at December 31, 2016, 2015, and 2014, respectively, were excluded from the computations of diluted net income per average common share because they would have been anti-dilutive. On April 1, 2016, the Company early adopted ASU 2016-09, which provides improvements to employee share-based payment accounting, with an effective date of January 1, 2016. The early adoption favorably impacted basic EPS by $0.03 per share and diluted EPS by $0.02 per share for the year ended December 31, 2016. See Note 1, "Significant Accounting Policies," for additional information.

Reconciliations of net income to net income available to common shareholders and the difference between average basic common shares outstanding and average diluted common shares outstanding are presented in the following table.



	Year Ended December 31
(Dollars and shares in millions, except per share data)	2016			2015			2014
Net income		$1,878			$1,933			$1,774
Preferred dividends	(66		)	(64		)	(42		)
Dividends and undistributed earnings allocated to unvested shares	(1		)	(6		)	(10		)
Net income available to common shareholders		$1,811			$1,863			$1,722

Average basic common shares	499			515			528
Effect of dilutive securities:
Stock options	1			2			1
Restricted stock, RSUs, and warrants	3			4			4
Average diluted common shares	503			521			533

Net income per average common share - diluted		$3.60			$3.58			$3.23
Net income per average common share - basic	3.63			3.62			3.26

Capital

Regulatory Capital Requirements under Banking Regulations [Text Block]

NOTE 13 – CAPITAL

During 2016, pursuant to the Federal Reserve's non-objection to the Company's capital plan in conjunction with the 2016 CCAR, the Company increased its quarterly common stock dividend from $0.24 to $0.26 per share beginning in the third quarter of 2016, maintained dividend payments on its preferred stock, and repurchased $480 million of its outstanding common stock at market value (approximately 11.0 million shares) under the 2016 plan. During the first and second quarters of 2016, the Company also repurchased $350 million of its outstanding common stock and common stock warrants, which completed its repurchase of authorized common equity under the 2015 CCAR capital plan, which effectively expired on June 30, 2016. At December 31, 2016, the Company had capacity under its 2016 capital plan to repurchase an additional $480 million of its outstanding common stock through June 30, 2017.

During the years ended December 31, 2016, 2015, and 2014, the Company declared and paid common dividends of $498 million, or $1.00 per common share, $475 million, or $0.92 per common share, and $371 million, or $0.70 per common share, respectively. The Company also recognized dividends on perpetual preferred stock of $66 million, $64 million, and $42 million during the years ended December 31, 2016, 2015, and 2014, respectively. During 2016, both the Series A and Series B Perpetual Preferred Stock dividend was $4,067 per share, the Series E Perpetual Preferred Stock dividend was $5,875 per share, and the Series F Perpetual Preferred Stock dividend was $5,625 per share.

The Company remains subject to certain restrictions on its ability to increase the dividend on common shares as a result of participating in the U.S. Treasury’s CPP. If the Company increases its dividend above $0.54 per share per quarter prior to the tenth anniversary of its participation in the CPP (in the fourth quarter of 2018), then the anti-dilution provision within the warrants issued in connection with the Company’s participation in the CPP will require the exercise price and number of shares to be issued upon exercise to be proportionately adjusted. The amount of such adjustment is determined by a formula and depends in part on the extent to which the Company raises its dividend. The formulas are contained in the warrant agreements which were filed as exhibits to Registration Statements on Form 8-A filed on September 23, 2011.

Substantially all of the Company’s retained earnings are undistributed earnings of the Bank, which are restricted by various regulations administered by federal and state bank regulatory authorities. At December 31, 2016 and 2015, retained earnings of the Bank available for payment of cash dividends to the Parent Company under these regulations totaled approximately $2.5 billion and $2.7 billion, respectively. Additionally, the Federal Reserve requires the Company to maintain cash reserves. At December 31, 2016 and 2015, these reserve requirements totaled $1.3 billion and $1.0 billion, respectively, and were fulfilled with a combination of cash on hand and deposits at the Federal Reserve.

Regulatory Capital

The Company is subject to various regulatory capital requirements that involve quantitative measures of the Company’s assets. The following table presents regulatory capital metrics for SunTrust and the Bank at December 31:



	2016				2015
(Dollars in millions)	Amount		Ratio		Amount		Ratio
SunTrust Banks, Inc.
CET1		$16,953	9.59	%		$16,421	9.96	%
Tier 1 capital	18,186		10.28		17,804		10.80
Total capital	21,685		12.26		20,668		12.54
Leverage			9.22				9.69
SunTrust Bank
CET1		$18,535	10.71	%		$17,859	11.02	%
Tier 1 capital	18,573		10.73		17,908		11.05
Total capital	21,276		12.29		20,101		12.40
Leverage			9.63				9.96

In 2013, the Federal Reserve published final rules in the Federal Register implementing Basel III. These rules, which became effective for the Company and the Bank on January 1, 2015, include the following minimum capital requirements: CET1 ratio of 4.5%; Tier 1 capital ratio of 6%; Total capital ratio of 8%; Leverage ratio of 4%; and a capital conservation buffer of 2.5%. The capital conservation buffer became applicable on January 1, 2016 and is being phased-in through December 31, 2018.

At December 31, 2016, the Company had $627 million in principal amount of trust preferred securities outstanding. The Basel III rules require the phase-out of non-qualifying Tier 1 capital instruments such as trust preferred securities. Accordingly, on January 1, 2015, the Company began phasing-out of Tier 1 capital its trust preferred and other hybrid capital securities, and instead began treating them as qualifying Tier 2 capital. Beginning January 1, 2016, these securities have been completely phased-out of Tier 1 capital and are classified as Tier 2 capital, using the methodology specified under Basel III.

Preferred Stock

Preferred stock at December 31 consisted of the following:



(Dollars in millions)	2016		2015		2014
Series A (1,725 shares outstanding)		$172		$172		$172
Series B(1,025 shares outstanding)	103		103		103
Series E (4,500 shares outstanding)	450		450		450
Series F (5,000 shares outstanding)	500		500		500
Total preferred stock		$1,225		$1,225		$1,225

In September 2006, the Company authorized and issued depositary shares representing ownership interests in 5,000 shares of Perpetual Preferred Stock, Series A, no par value and $100,000 liquidation preference per share (the Series A Preferred Stock). The Series A Preferred Stock has no stated maturity and will not be subject to any sinking fund or other obligation of the Company. Dividends on the Series A Preferred Stock, if declared, will accrue and be payable quarterly at a rate per annum equal to the greater of three-month LIBOR plus 0.53%, or 4.00%. Dividends on the shares are noncumulative. Shares of the Series A Preferred Stock have priority over the Company’s common stock with regard to the payment of dividends and, as such, the Company may not pay dividends on or repurchase, redeem, or otherwise acquire for consideration shares of its common stock unless dividends for the Series A Preferred Stock have been declared for that period and sufficient funds have been set aside to make payment. During 2009, the Company repurchased 3,275 shares of the Series A Preferred Stock. In September 2011, the Series A Preferred Stock became redeemable at the Company’s option at a redemption price equal to $100,000 per share, plus any declared and unpaid dividends. Except in certain limited circumstances, the Series A Preferred Stock does not have any voting rights.

In December 2011, the Company authorized 5,010 shares and issued 1,025 shares of Perpetual Preferred Stock, Series B, no par value and $100,000 liquidation preference per share (the Series B Preferred Stock). The Series B Preferred Stock has no stated maturity and will not be subject to any sinking fund or other obligation of the Company. Dividends on the shares are noncumulative and, if declared, will accrue and be payable quarterly at a rate per annum equal to the greater of three-month LIBOR plus 0.65%, or 4.00%. Shares of the Series B Preferred Stock have priority over the Company's common stock with regard to the payment of dividends and, as such, the Company may not pay dividends on or repurchase, redeem, or otherwise acquire for consideration shares of its common stock unless dividends for the Series B Preferred Stock have been declared for that period and sufficient funds have been set aside to make payment. The Series B Preferred Stock was immediately redeemable upon issuance at the Company's option at a redemption price equal to $100,000 per share, plus any declared and unpaid dividends. Except in certain limited circumstances, the Series B Preferred Stock does not have any voting rights.

In December 2012, the Company authorized 5,000 shares and issued 4,500 shares of Perpetual Preferred Stock, Series E, no par value and $100,000 liquidation preference per share (the Series E Preferred Stock). The Series E Preferred Stock has no stated maturity and will not be subject to any sinking fund or other obligation of the Company to redeem, repurchase, or retire the shares. Dividends on the shares are noncumulative and, if declared, will accrue and be payable quarterly at a rate per annum of 5.875%. Shares of the Series E Preferred Stock have priority over the Company's common stock with regard to the payment of dividends and rank equally with the Company's outstanding Perpetual Preferred Stock, Series A and Series B and, as such, the Company may not pay dividends on or repurchase, redeem, or otherwise acquire for consideration shares of its common stock unless dividends for the Series E Preferred Stock have been declared for that period and sufficient funds have been set aside to make payment. The Series E Preferred Stock is redeemable, at the option of the Company, on any dividend payment date occurring on or after March 15, 2018, at a redemption price equal to $100,000 per share, plus any declared and unpaid dividends, without regard to any undeclared dividends. Except in certain limited circumstances, the Series E Preferred Stock does not have any voting rights.

In November 2014, the Company issued depositary shares representing ownership interest in 5,000 shares of Perpetual Preferred Stock, Series F, with no par value and $100,000 liquidation preference per share (the Series F Preferred Stock). As a result of this issuance, the Company received net proceeds of $496 million after the underwriting discount, but before expenses, and used the net proceeds for general corporate purposes. The Series F Preferred Stock has no stated maturity and will not be subject to any sinking fund or other obligation of the Company to redeem, repurchase, or retire the shares. Dividends for the shares are noncumulative and, if declared, will be payable semi-annually beginning on June 15, 2015 through December 15, 2019 at a rate per annum of 5.625%, and payable quarterly beginning on March 15, 2020 at a rate per annum equal to the three-month LIBOR plus 3.86%. By its terms, the Company may redeem the Series F Preferred Stock on any dividend payment date occurring on or after December 15, 2019 or at any time within 90 days following a regulatory capital event, at a redemption price of $100,000 per share plus any declared and unpaid dividends. Except in certain limited circumstances, the Series F Preferred Stock does not have any voting rights.

In 2008, the Company issued to the U.S. Treasury as part of the CPP, Series C and D Fixed Rate Cumulative Perpetual Preferred Stock and Series A and B warrants to purchase a total of 17.9 million shares of the Company's common stock. The Series A warrants entitle the holder to purchase 6 million shares of the Company's common stock at an exercise price of $33.70 per share, while the Series B warrants entitle the holder to purchase 11.9 million shares of the Company's common stock at an exercise price of $44.15 per share. The Series A and B warrants have expiration dates of December 2018 and November 2018, respectively.

In March 2011, the Company repurchased its Series C and D Preferred Stock from the U.S. Treasury. In September 2011, the U.S. Treasury held a public auction to sell the warrants to purchase the 17.9 million shares of the Company's common stock. In conjunction with the U.S. Treasury's auction, the Company acquired 4 million of the common stock purchase warrants, Series A, for $11 million, which were then retired. In January and February of 2016, the Company acquired an additional 1.1 million of Series A common stock warrants and 5.4 million of Series B common stock warrants as part of its 2015 CCAR capital plan for a total of $24 million.

At December 31, 2016, 7.4 million warrants remained outstanding and the Company had authority from its Board to repurchase all of these outstanding stock purchase warrants; however, any such repurchase would be subject to the non-objection of the Federal Reserve through the capital planning and stress testing process.

Income Taxes

Income Tax Disclosure [Text Block]

NOTE 14 - INCOME TAXES

The components of the provision for income taxes included in the Consolidated Statements of Income for the years ended December 31 are presented in the following table:



(Dollars in millions)	2016		2015			2014
Current income tax provision:
Federal		$667		$707			$365
State	27		36			29
Total	694		743			394
Deferred income tax provision/(benefit):
Federal	59		27			99
State	52		(6		)	—
Total	111		21			99
Total provision for income taxes		$805		$764			$493

The provision for income taxes does not reflect the tax effects of unrealized gains and losses and other income and expenses recorded in AOCI. For additional information on AOCI, see Note 21, “Accumulated Other Comprehensive (Loss)/Income.”

A reconciliation of the provision for income taxes, using the statutory federal income tax rate of 35%, to the Company’s actual provision for income taxes and the effective tax rate during the years ended December 31 are presented in the following table:



	2016							2015					2014
(Dollars in millions)	Amount				% of Pre-Tax Income			Amount			% of Pre-Tax Income		Amount			% of Pre-Tax Income
Income tax provision at federal statutory rate		$939			35.0	%			$944		35.0	%		$793		35.0	%
Increase/(decrease) resulting from:
State income taxes, net	53				2.0			25			0.9		12			0.5
Tax-exempt interest	(86		)		(3.2	)		(88		)	(3.3	)	(89		)	(3.9	)
Changes in UTBs (including interest), net	6				0.2			(31		)	(1.1	)	(82		)	(3.6	)
Income tax credits, net of amortization ¹	(86		)		(3.2	)		(69		)	(2.6	)	(65		)	(2.9	)
Non-deductible expenses	8				0.3			—			—		(57		)	(2.5	)
Other	(29		)	²	(1.1	)	²	(17		)	(0.6	)	(19		)	(0.8	)
Total provision for income taxes and effective tax rate		$805			30.0	%			$764		28.3	%		$493		21.8	%

¹Excludes income tax benefits of $2 million, $6 million, and $21 million for the years ended December 31, 2016, 2015, and 2014, respectively, related to tax credits, which were recognized as a reduction to the related investment asset.

²Includes income tax benefits of $15 million related to the Company's early adoption of ASU 2016-09. See Note 1, "Significant Accounting Policies," for additional information.

Deferred income tax assets and liabilities result from differences between the timing of the recognition of assets and liabilities for financial reporting purposes and for income tax purposes. These assets and liabilities are measured using the enacted federal and state tax rates expected to apply in the periods in which the deferred tax assets or liabilities are expected to be realized. The net deferred income tax liability is recorded in other liabilities in the Consolidated Balance Sheets.

The significant DTAs and DTLs at December 31, net of the federal impact for state taxes, are presented in the following table:



(Dollars in millions)	2016			2015
DTAs:
ALLL		$639			$651
Accrued expenses	275			297
State NOLs and other carryforwards	170			192
Net unrealized losses in AOCI	472			257
Other	70			97
Total gross DTAs	1,626			1,494
Valuation allowance	(80		)	(79		)
Total DTAs	1,546			1,415
DTLs:
Leasing	659			707
Compensation and employee benefits	179			140
MSRs	370			372
Loans	142			109
Goodwill and intangible assets	233			216
Fixed assets	113			131
Other	82			65
Total DTLs	1,778			1,740
Net DTL		($232	)		($325	)

The DTAs include state NOLs and other state carryforwards that will expire, if not utilized, in varying amounts from 2017 to 2036. At December 31, 2016 and 2015, the Company had a valuation allowance recorded against its state carryforwards and certain state DTAs of $80 million and $79 million, respectively. A valuation allowance is not required for the federal and the remaining state DTAs because the Company believes it is more-likely-than-not that these assets will be realized.

The following table provides a rollforward of the Company's gross federal and state UTBs, excluding interest and penalties, during the years ended December 31:



(Dollars in millions)	2016			2015
Balance at January 1		$100			$210
Increases in UTBs related to prior years	18			4
Decreases in UTBs related to prior years	(4		)	(4		)
Increases in UTBs related to the current year	13			10
Decreases in UTBs related to settlements	(16		)	(119		)
Decreases in UTBs related to lapse of the applicable statutes of limitations	—			(1		)
Balance at December 31		$111			$100

The amount of UTBs that would favorably affect the Company's effective tax rate, if recognized, was $74 million at December 31, 2016.

Interest and penalties related to UTBs are recorded in the provision for income taxes. The Company had a gross liability of $8 million for interest and penalties related to its UTBs at both December 31, 2016 and 2015. During the years ended December 31, 2016 and 2015, the Company recognized a gross benefit of less than $1 million and $4 million, respectively, for interest and penalties on the UTBs.

The Company files U.S. federal, state, and local income tax returns. The Company's federal income tax returns are no longer subject to examination by the IRS for taxable years prior to 2011. With limited exceptions, the Company is no longer subject to examination by state and local taxing authorities for taxable years prior to 2012. It is reasonably possible that the liability for UTBs could decrease by as much as $5 million during the next 12 months due to completion of tax authority examinations and the expiration of statutes of limitations. It is uncertain how much, if any, of this potential decrease will impact the Company’s effective tax rate.

Employee Benefit Plans

NOTE 15 - EMPLOYEE BENEFIT PLANS

The Company sponsors various compensation and benefit programs to attract and retain talent. Aligned with a pay for performance culture, the Company's plans and programs include short-term incentives, AIP, LTI cash and LTI plans with various forms of stock-based compensation, which are discussed in the following section. All incentive awards are subject to clawback provisions. Compensation expense for long-term incentive plans with cash payouts was $291 million, $245 million, and $203 million for the years ended December 31, 2016, 2015, and 2014, respectively. Compensation expense for short-term incentive plans with cash payouts was $469 million, $448 million, and $462 million for the years ended December 31, 2016, 2015, and 2014, respectively.

Stock-Based Compensation

The Company provides stock-based awards through the 2009 Stock Plan and various other deferred compensation plans under which the Compensation Committee of the Board of Directors has the authority to grant stock options, stock appreciation rights, restricted stock, phantom stock units, and RSUs to key employees of the Company. Award vesting may be conditional based upon individual, business unit, Company, and/or performance relative to peer group metrics. On April 1, 2016, the Company early adopted ASU 2016-09, which provides improvements to employee share-based payment accounting, with an effective date of January 1, 2016. See Note 1, "Significant Accounting Policies," for additional information.

As amended and restated effective January 1, 2014, following approval by the Compensation Committee of the Board, shareholders approved an amendment to the 2009 Stock Plan to remove the sub-limit on shares available for grant that may be issued as restricted stock or RSUs. Accordingly, all 17 million remaining authorized shares previously under the Stock Plan became available for grant as stock options, stock appreciation rights, restricted stock, or RSUs. Prior to the amendment, only a portion of such shares were available to be granted as either restricted stock or RSUs. At December 31, 2016, approximately 17 million shares were available for grant. All stock option grants are exercisable for 10 years after the grant date.

Shares or units of restricted stock may be granted to employees and directors. Generally, grants to employees either cliff vest after three years or vest pro-rata annually over three years. Restricted stock and RSU grants may be subject to one or more criteria, including employment, performance, or other conditions as established by the Compensation Committee at the time of grant. Any shares of restricted stock that are forfeited will again become available for issuance under the Stock Plan. An employee or director has the right to vote the shares of restricted stock after grant until they are forfeited. Compensation cost for restricted stock and RSUs is generally equal to the fair market value of the shares on the grant date of the award and is amortized to compensation expense over the vesting period. Dividends are paid on awarded, unvested restricted stock.

The Company accrues and reinvests dividends in equivalent shares of SunTrust common stock for unvested RSU awards, which are paid out when the underlying RSU award vests. Generally, RSU awards are classified as equity. However, during 2012 there were 574,257 RSUs granted that were classified as a liability. These awards were granted with a fair value of $21.67 per unit on the grant date. RSUs classified as a liability at December 31, 2015 totaled $23 million. These awards were fully vested and paid in cash during February 2016.

Consistent with the Company's 2014 decision to discontinue the issuance of stock options, no stock options were granted during the years ended December 31, 2016, 2015, and 2014.

The following table presents a summary of stock options, restricted stock, and RSU activity for the years ended December 31:



	Stock Options					Restricted Stock							Restricted Stock Units
(Dollars in millions, except per share data)	Shares		Price Range	Weighted Average Exercise Price		Shares		Deferred Compensation			Weighted Average Grant Price		Shares		Weighted Average Grant Price
Balance, January 1, 2014	10,929,371		$9.06 - 150.45		$49.86	3,983,538			$50			$27.04	2,496,178			$26.69
Granted	—		—	—		21,427		—			39.20		1,590,075		36.67
Exercised/vested	(426,889	)	9.06 - 32.27	20.86		(957,308	)	—			29.31		(338,196	)	32.80
Cancelled/expired/forfeited	(2,774,725	)	23.70 - 149.81	71.10		(117,798	)	(2		)	25.60		(58,793	)	37.73
Amortization of restricted stock compensation	—		—	—		—		(27		)	—		—		—
Balance, December 31, 2014	7,727,757		9.06 - 150.45	43.84		2,929,859		21			26.45		3,689,264		31.15
Granted	—		—	—		20,412		1			41.15		1,670,587		40.54
Exercised/vested	(687,832	)	9.06 - 32.27	20.38		(1,510,045	)	—			22.86		(883,621	)	26.39
Cancelled/expired/forfeited	(1,821,667	)	23.70 - 150.45	73.01		(106,151	)	(4		)	29.95		(157,390	)	39.19
Amortization of restricted stock compensation	—		—	—		—		(16		)	—		—		—
Balance, December 31, 2015	5,218,258		9.06 - 85.34	36.75		1,334,075		2			30.44		4,318,840		35.44
Granted	—		—	—		11,312		1			42.44		2,548,326		35.08
Exercised/vested	(1,547,255	)	9.06 - 32.27	16.25		(1,332,995	)	—			30.43		(2,428,213	)	30.52
Cancelled/expired/forfeited	(417,210	)	21.67 - 71.03	67.59		(1,080	)	(1		)	35.03		(263,144	)	36.67
Amortization of restricted stock compensation	—		—	—		—		(2		)	—		—		—
Balance, December 31, 2016	3,253,793		$9.06 - 85.34		$42.54	11,312			$—			$42.44	4,175,809			$36.27
Exercisable, December 31, 2016	3,253,793				$42.54

The following table presents stock option information at December 31, 2016:



	Options Outstanding						Options Exercisable
(Dollars in millions, except per share data)	Number Outstanding at December 31, 2016	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Total Aggregate Intrinsic Value		Number Exercisable at December 31, 2016	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Total Aggregate Intrinsic Value
Range of Exercise Prices:
$9.06 to 49.46	1,904,207		$22.00	3.73		$63	1,904,207		$22.00	3.73		$63
$49.47 to 64.57	781	56.34		0.84	—		781	56.34		0.84	—
$64.58 to 85.34	1,348,805	71.53		0.51	—		1,348,805	71.53		0.51	—
	3,253,793		$42.54	2.39		$63	3,253,793		$42.54	2.39		$63

The aggregate intrinsic value in the preceding table represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of 2016 and the exercise price, multiplied by the number of in-the-money stock options) that would have been received by the option holders had all option holders exercised their options on December 31, 2016. Additional option and stock-based compensation information at December 31 is presented in the following table:



(Dollars in millions)	2016		2015		2014
Intrinsic value of options exercised ¹		$43		$15		$8
Fair value of vested restricted shares ¹	41		35		28
Fair value of vested RSUs ¹	74		23		11

¹Measured as of the grant date.

At December 31, 2016 and 2015, there was $65 million and $54 million, respectively, of unrecognized stock-based compensation expense related to stock options, restricted stock, and RSUs. The unrecognized stock compensation expense for December 31, 2016 is expected to be recognized over a weighted average period of 2.2 years.

Additionally, the Company allows for the granting of phantom stock units, whereby certain employees are granted the contractual right to receive an amount in cash equal to the fair market value of a share of common stock on the vesting date. These shares vest pro-rata annually over three years on the anniversary of the grant date and are subject to variable accounting. The employees are entitled to dividend-equivalent rights on the granted shares. The Company granted 1.8 million, 1.4 million, and 1.2 million phantom stock units during 2016, 2015, and 2014, respectively. The unrecognized compensation expense related to these phantom stock units as of December 31, 2016 was $87 million based on the Company's stock price as of that date.

Stock-based compensation expense recognized in noninterest expense consisted of the following:



	Years Ended December 31
(Dollars in millions)	2016		2015		2014
Stock options		$—		$1		$2
Restricted stock	2		16		27
Phantom stock units ¹	67		32		13
RSUs	56		46		34
Total stock-based compensation		$125		$95		$76
Stock-based compensation tax benefit		$48		$36		$29

¹Phantom stock units are settled in cash.

Retirement Plans

Noncontributory Pension Plans

The Company maintains various frozen, funded, noncontributory qualified retirement plans ("Retirement Plans") covering employees meeting certain service requirements. The Retirement Plans provide benefits based on salary and years of service. The SunTrust Retirement Plan includes a cash balance formula where the PPAs continue to be credited with interest each year. The interest crediting rate applied to each PPA was 3.00% for 2016. The Company monitors the funded status of the Retirement Plans closely and, due to the current funded status, the Company did not make a contribution to them for the 2016 plan year.

The Company also maintains various frozen, unfunded, noncontributory nonqualified supplemental defined benefit pension plans that cover key executives of the Company (the "SERP", the "ERISA Excess Plan", and the "Restoration Plan"). These plans provide defined benefits based on years of service and salary.

Other Postretirement Benefits

The Company provides certain health care and life insurance benefits (“Other Postretirement Benefits”) to retired employees. At the option of the Company, retirees may continue certain health and life insurance benefits if they meet specific age and service requirements at the time of retirement. The health care plans are contributory with participant contributions adjusted annually, and the life insurance plans are noncontributory. Certain retiree health benefits are funded in a Retiree Health Trust. Additionally, certain retiree life insurance benefits are funded in a VEBA. Effective April 1, 2014, the Company amended the plan, which now requires retirees age 65 and older to enroll in individual Medicare supplemental plans. In addition, the Company will fund a tax-advantaged HRA to assist some retirees with medical expenses.

Changes in Benefit Obligations and Plan Assets

The following table presents the change in benefit obligations, change in fair value of plan assets, funded status, accumulated benefit obligation, and the weighted average discount rate related to the Company's pension and other postretirement benefits plans for the years ended December 31:



	Pension Benefits ¹						Other Postretirement Benefits
(Dollars in millions)	2016			2015			2016			2015
Benefit obligation, beginning of year		$2,716			$2,935			$65			$69
Service cost	5			5			—			—
Interest cost	97			116			2			2
Plan participants’ contributions	—			—			4			6
Actuarial loss/(gain)	76			(171		)	(4		)	(2		)
Benefits paid	(142		)	(164		)	(9		)	(10		)
Administrative expenses paid from pension trust	(5		)	(5		)	—			—
Benefit obligation, end of year ²		$2,747			$2,716			$58			$65

Change in plan assets:
Fair value of plan assets, beginning of year		$2,879			$3,080			$156			$160
Actual return on plan assets	279			(37		)	5			1
Employer contributions ³	5			5			—			—
Plan participants’ contributions	—			—			5			5
Benefits paid	(142		)	(164		)	(9		)	(10		)
Administrative expenses paid from pension trust	(5		)	(5		)	—			—
Fair value of plan assets, end of year ⁴		$3,016			$2,879			$157			$156

Funded status at end of year ^{5, 6}		$269			$163			$99			$91
Funded status at end of year (%)	110		%	106		%

Accumulated benefit obligation		$2,747			$2,716

Discount rate	4.18		%	4.44		%	3.70		%	3.95		%

¹ Employer contributions represent the benefits that were paid to nonqualified plan participants. Unfunded nonqualified supplemental pension plans are not funded through plan assets.

²Includes $80 million and $81 million of benefit obligations for the unfunded nonqualified supplemental pension plans at December 31, 2016 and 2015, respectively.

³The Company contributed less than $1 million to the other postretirement benefits plans during both 2016 and 2015.

⁴Includes $2 million and $1 million of the Company's common stock acquired by the asset manager and held as part of the equity portfolio for pension benefits at December 31, 2016 and 2015, respectively. During both 2016 and 2015, there was no SunTrust common stock held in the other postretirement benefit plans.

⁵Pension benefits recorded in the Consolidated Balance Sheets included other assets of $349 million and $244 million, and other liabilities of $80 million and $81 million, at December 31, 2016 and 2015, respectively.

⁶Other postretirement benefits recorded in the Consolidated Balance Sheets included other assets of $99 million and $91 million at December 31, 2016 and 2015, respectively.

Net Periodic Benefit

Components of net periodic benefit for the years ended December 31 are presented in the following table:



	Pension Benefits ¹									Other Postretirement Benefits
(Dollars in millions)	2016			2015			2014			2016			2015			2014
Service cost		$5			$5			$5			$—			$—			$—
Interest cost	97			116			124			2			2			3
Expected return on plan assets	(186		)	(206		)	(200		)	(5		)	(5		)	(5		)
Amortization of prior service credit	—			—			—			(6		)	(6		)	(6		)
Amortization of actuarial loss	25			21			16			—			—			—
Net periodic benefit		($59	)		($64	)		($55	)		($9	)		($9	)		($8	)

Weighted average assumptions used to determine net periodic benefit:
Discount rate	4.44		%	4.09		%	4.98		%	3.95		%	3.60		%	4.15		%
Expected return on plan assets	6.68			6.91			7.17			3.13			3.50			3.68

¹Administrative fees are recognized in service cost for each of the periods presented.

Amounts Recognized in AOCI

Components of the benefit obligations AOCI balance at December 31 were as follows:



	Pension Benefits				Other Postretirement Benefits
(Dollars in millions)	2016		2015		2016			2015
Prior service credit		$—		$—		($59	)		($64	)
Net actuarial loss/(gain)	1,031		1,072		(15		)	(11		)
Total AOCI, pre-tax		$1,031		$1,072		($74	)		($75	)

Other changes in plan assets and benefit obligations recognized in AOCI during 2016 were as follows:



(Dollars in millions)	Pension Benefits			Other Postretirement Benefits
Current year actuarial gain		($16	)		($5	)
Amortization of prior service credit	—			6
Amortization of actuarial loss	(25		)	—
Total recognized in AOCI, pre-tax		($41	)		$1
Total recognized in net periodic benefit and AOCI, pre-tax		($100	)		($8	)

For pension plans, the estimated actuarial loss that will be amortized from AOCI into net periodic benefit in 2017 is $24 million. For other postretirement benefit plans, the estimated prior service credit to be amortized from AOCI into net periodic benefit in 2017 is $6 million.

Plan Assumptions

Each year, the SBFC, which includes several members of senior management, reviews and approves the assumptions used in the year-end measurement calculations for each plan. The discount rate for each plan, used to determine the present value of future benefit obligations, is determined by matching the expected cash flows of each plan to a yield curve based on long-term, high quality fixed income debt instruments available as of the measurement date. A series of benefit payments projected to be paid by the plan is developed based on the most recent census data, plan provisions, and assumptions. The benefit payments at each future maturity date are discounted by the year-appropriate spot interest rates. The model then solves for the discount rate that produces the same present value of the projected benefit payments as generated by discounting each year’s payments by the spot interest rate.

On December 31, 2015, the Company refined the calculation of the service and interest cost components of net periodic benefit expense for pension and other postretirement benefit plans. Previously the Company estimated service and interest cost components utilizing a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. Under the refined method, the Company utilized a full yield curve approach to estimate these components by applying specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. The Company made this change to more closely match the projected benefit cash flows and the corresponding yield curve spot rates, and to provide a more precise measurement of service and interest costs. This change had no impact on the measurement of the Company’s total benefit obligations recorded at December 31, 2015 or any other prior period. The Company accounted for this service and interest cost methodology refinement as a change in estimate that is inseparable from a change in accounting principle, and accordingly, recognized its effect prospectively beginning in 2016, which impacted the total 2016 net periodic pension benefit by $19 million. The change in estimate favorably impacted both basic and diluted EPS by $0.04 per share for the year ended December 31, 2016.

Actuarial gains and losses are created when actual experience deviates from assumptions. The actuarial gains during 2016 for the pension plans resulted primarily from asset experience. The actuarial losses during 2015 for the pension plans resulted primarily from asset experience.

The SBFC establishes investment policies and strategies and formally monitors the performance of the investments throughout the year. The Company’s investment strategy with respect to pension assets is to invest the assets in accordance with ERISA and related fiduciary standards. The long-term primary investment objectives for the pension plans are to provide a commensurate amount of long-term growth of principal and income in order to satisfy the pension plan obligations without undue exposure to risk in any single asset class or investment category. The objectives are accomplished through investments in equities, fixed income, and cash equivalents using a mix that is conducive to participation in a rising market while allowing for protection in a declining market. The portfolio is viewed as long-term in its entirety, avoiding decisions regarding short-term concerns and any single investment. Asset allocation, as a percent of the total market value of the total portfolio, is set with the target percentages and ranges presented in the investment policy statement. Rebalancing occurs on a periodic basis to maintain the target allocation, but normal market activity may result in deviations.

The basis for determining the overall expected long-term rate of return on plan assets considers past experience, current market conditions, and expectations on future trends. A building block approach is used that considers long-term inflation, real returns, equity risk premiums, target asset allocations, market corrections, and expenses. Capital market simulations from internal and external sources, survey data, economic forecasts, and actuarial judgment are all used in this process. The expected long-term rate of return for pension obligations is 6.66% for 2017.

The investment strategy for the other postretirement benefit plans is maintained separately from the strategy for the pension plans. The Company’s investment strategy is to create a series of investment returns sufficient to provide a commensurate amount of long-term principal and income growth in order to satisfy the other postretirement benefit plan's obligations. Assets are diversified among equity funds and fixed income investments according to the mix approved by the SBFC. Due to other postretirement benefits having a shorter time horizon, a lower equity profile is appropriate. The expected long-term rate of return for other postretirement benefits is 3.12% for 2017.

Plan Assets Measured at Fair Value

The following tables present combined pension and other postretirement benefit plan assets measured at fair value. See Note 18, "Fair Value Election and Measurement" for level definitions within the fair value hierarchy.



				Fair Value Measurements at December 31, 2016 ¹
(Dollars in millions)	Total			Level 1		Level 2			Level 3
Money market funds ²		$112			$112		$—			$—
Equity securities	1,415			1,415		—			—
Mutual funds ³:
Equity index fund	47			47		—			—
Tax exempt municipal bond funds	82			82		—			—
Taxable fixed income index funds	13			13		—			—
Futures contracts	(5		)	—		(5		)	—
Fixed income securities	1,486			—		1,486			—
Other assets	6			6		—			—
Total plan assets		$3,156			$1,675		$1,481			$—

¹Fair value measurements do not include pension benefits accrued income amounting to less than 0.6% of total plan assets.

²Includes $16 million for other postretirement benefit plans.

³Relates exclusively to other postretirement benefit plans.



				Fair Value Measurements at December 31, 2015 ¹
(Dollars in millions)	Total			Level 1		Level 2			Level 3
Money market funds ²		$83			$83		$—			$—
Equity securities	1,416			1,416		—			—
Mutual funds ³:
Equity index fund	48			48		—			—
Tax exempt municipal bond funds	84			84		—			—
Taxable fixed income index funds	13			13		—			—
Futures contracts	(11		)	—		(11		)	—
Fixed income securities	1,381			—		1,381			—
Other assets	11			11		—			—
Total plan assets		$3,025			$1,655		$1,370			$—

¹Fair value measurements do not include pension benefits accrued income amounting to less than 0.4% of total plan assets.

²Includes $11 million for other postretirement benefit plans.

³Relates exclusively to other postretirement benefit plans.

Target allocations for pension and other postretirement benefits at December 31, by asset category, are presented below:



	Pension Benefits						Other Postretirement Benefits
	Target Allocation		% of plan assets				Target Allocation		% of plan assets
	Target Allocation		2016		2015		Target Allocation		2016		2015
Cash equivalents	0-10	%	3	%	3	%	5-15	%	10	%	7	%
Equity securities	0-50		47		49		20-40		30		31
Debt securities	50-100		50		48		50-70		60		62
Total			100	%	100	%			100	%	100	%

The Company sets pension asset values equal to their market value, reflecting gains and losses immediately rather than deferring over a period of years, which provides a more realistic economic measure of the plan’s funded status and cost. Assumed healthcare cost trend rates have a significant effect on the amounts reported for the other postretirement benefit plans. At December 31, 2016, the Company assumed that pre-65 retiree healthcare costs will increase at an initial rate of 7.00% per year. The Company expects this annual cost increase to decrease over an 8-year period to 5.00% per year. The effect of a 1% increase/decrease in the healthcare cost trend rate for other postretirement benefit obligations, service cost, and interest cost are less than $1 million, respectively. Assumed discount rates and expected returns on plan assets affect the amounts of net periodic benefit. A 25 basis point increase/decrease in the expected long-term return on plan assets would increase/decrease the net periodic benefit by $7 million for pension and other postretirement benefits plans. A 25 basis point increase/decrease in the discount rate would change the net periodic benefit by less than $1 million for pension and other postretirement benefits plans.

Expected Cash Flows

Expected cash flows for the pension and other postretirement benefit plans are presented in the following table:



(Dollars in millions)	Pension Benefits ¹		Other Postretirement Benefits (excluding Medicare Subsidy) ²
Employer Contributions:
2017 (expected) to plan trusts		$—		$—
2017 (expected) to plan participants ³	11		—

Expected Benefit Payments:
2017	183		6
2018	168		6
2019	166		5
2020	165		5
2021	165		4
2022 - 2026	812		19

¹Based on the funding status and ERISA limitations, the Company anticipates contributions to the Retirement Plan will not be required during 2017.

²Expected payments under other postretirement benefit plans are shown net of participant contributions.

³The expected benefit payments for the SERP will be paid directly from the Company's corporate assets.

Defined Contribution Plans

SunTrust's employee benefit program includes a qualified defined contribution plan. For years ended December 31, 2016, 2015, and 2014, the 401(k) plan provided a dollar-for-dollar match on the first 6% of eligible pay that a participant, including executive participants, elected to defer.

SunTrust also maintains the SunTrust Banks, Inc. Deferred Compensation Plan in which key executives of the Company are eligible. Matching contributions for the deferred compensation plan are the same percentage as provided in the 401(k) plan, subject to limitations imposed by the plans' provisions and applicable laws and regulations. Matching contributions for both the Company's 401(k) plan and the deferred compensation plan fully vest upon two years of completed service. Furthermore, both plans permit an additional discretionary Company contribution equal to a fixed percentage of eligible pay.

The Company's 401(k) expense, including any discretionary contributions, was $105 million, $121 million, and $117 million for the years ended December 31, 2016, 2015, and 2014, respectively.

Guarantees

NOTE 16 – GUARANTEES

The Company has undertaken certain guarantee obligations in the ordinary course of business. The issuance of a guarantee imposes an obligation for the Company to stand ready to perform and make future payments should certain triggering events occur. Payments may be in the form of cash, financial instruments, other assets, shares of stock, or through provision of the Company’s services. The following is a discussion of the guarantees that the Company has issued at December 31, 2016. The Company has also entered into certain contracts that are similar to guarantees, but that are accounted for as derivative instruments as discussed in Note 17, “Derivative Financial Instruments.”

Letters of Credit

Letters of credit are conditional commitments issued by the Company, generally to guarantee the performance of a client to a third party in borrowing arrangements, such as CP, bond financing, or similar transactions. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to clients but may be reduced by selling participations to third parties. The Company issues letters of credit that are classified as financial standby, performance standby, or commercial letters of credit.

At both December 31, 2016 and 2015, the Company's maximum potential exposure for issued financial and performance standby letters of credit was $2.9 billion. The Company’s outstanding letters of credit generally have a term of more than one year. Some standby letters of credit are designed to be drawn upon in the normal course of business and others are drawn upon only in circumstances of dispute or default in the underlying transaction to which the Company is not a party. In all cases, the Company is entitled to reimbursement from the client. If a letter of credit is drawn upon and reimbursement is not provided by the client, the Company may take possession of the collateral securing the letter of credit, where applicable.

The Company monitors its credit exposure under standby letters of credit in the same manner as it monitors other extensions of credit in accordance with its credit policies. Consistent with the methodologies used for all commercial borrowers, an internal assessment of the PD and loss severity in the event of default is performed. The management of credit risk for letters of credit leverages the risk rating process to focus greater visibility on higher risk and/or higher dollar letters of credit. The allowance for credit losses associated with letters of credit is a component of the unfunded commitments reserve recorded in other liabilities on the Consolidated Balance Sheets and is included in the allowance for credit losses as disclosed in Note 7, “Allowance for Credit Losses.” Additionally, unearned fees relating to letters of credit are recorded in other liabilities on the Consolidated Balance Sheets. The net carrying amount of unearned fees was immaterial at both December 31, 2016 and 2015.

Loan Sales and Servicing

STM, a consolidated subsidiary of the Company, originates and purchases residential mortgage loans, a portion of which are sold to outside investors in the normal course of business through a combination of whole loan sales to GSEs, Ginnie Mae, and non-agency investors. In connection with the December 2016 acquisition of Pillar, the Company also originates and sells certain commercial mortgage loans to Fannie Mae and Freddie Mac, originates FHA insured loans, and issues and sells Ginnie Mae commercial MBS backed by FHA insured loans.

When residential loans are sold, representations and warranties regarding certain attributes of the loans are made to third party purchasers. Subsequent to the sale, if a material underwriting deficiency or documentation defect is discovered, the Company may be obligated to repurchase the loan or to reimburse an investor for losses incurred (make whole requests), if such deficiency or defect cannot be cured by the Company within the specified period following discovery. Additionally, servicing representations and warranties can result in loan repurchases, as well as adversely affect the valuation of servicing rights, servicing advances, or other loan-related exposures, such as OREO. These representations and warranties may extend through the life of the loan. The Company’s risk of loss under its representations and warranties is partially driven by borrower payment performance since investors will perform extensive reviews of delinquent loans as a means of mitigating losses.

Loans sold to Ginnie Mae are insured by the FHA or are guaranteed by the VA. As servicer, the Company may elect to repurchase delinquent loans in accordance with Ginnie Mae guidelines; however, the loans continue to be insured. The Company may also indemnify the FHA and VA for losses related to loans not originated in accordance with their guidelines.

The Company previously reached agreements with Freddie Mac and Fannie Mae that relieve the Company of certain existing and future repurchase obligations related to loans sold from 2000-2008 to Freddie Mac and loans sold from 2000-2012 to Fannie Mae. The Company experienced significantly fewer repurchase claims and losses related to loans sold since 2009, relative to pre-2009 vintages, as a result of stronger credit performance, more stringent credit guidelines, and underwriting process improvements.

Repurchase requests from GSEs, Ginnie Mae, and non-agency investors, for all vintages, are presented in the following table that summarizes demand activity for the years ended December 31.



(Dollars in millions)	2016			2015			2014
Pending repurchase requests, beginning of period		$17			$47			$126
Repurchase requests received	44			73			158
Repurchase requests resolved:
Repurchased	(18		)	(22		)	(28		)
Cured	(29		)	(81		)	(209		)
Total resolved	(47		)	(103		)	(237		)
Pending repurchase requests, end of period ¹		$14			$17			$47

Percent from non-agency investors:
Pending repurchase requests, end of period	40.4		%	32.9		%	6.7		%
Repurchase requests received	7.1		%	7.2		%	0.9		%

¹Comprised of $8 million, $11 million, and $44 million from the GSEs, and $6 million, $6 million, and $3 million from non-agency investors at December 31, 2016, 2015, and 2014 respectively.

The repurchase and make whole requests received have been due primarily to alleged material breaches of representations related to compliance with the applicable underwriting standards, including borrower misrepresentation and appraisal issues. The Company performs a loan-by-loan review of all requests and contests demands to the extent they are not considered valid.

The following table summarizes the changes in the Company’s reserve for residential mortgage loan repurchases for the years ended December 31:



(Dollars in millions)	2016			2015			2014
Balance, beginning of period		$57			$85			$78
Repurchase (benefit)/provision	(17		)	(12		)	12
Charge-offs, net of recoveries	—			(16		)	(5		)
Balance, end of period		$40			$57			$85

A significant degree of judgment is used to estimate the mortgage repurchase liability as the estimation process is inherently uncertain and subject to imprecision. The Company believes that its reserve appropriately estimates incurred losses based on its current analysis and assumptions, inclusive of the Freddie Mac and Fannie Mae settlement agreements, GSE owned loans serviced by third party servicers, loans sold to private investors, and other indemnifications.

Notwithstanding the aforementioned agreements with Freddie Mac and Fannie Mae settling certain aspects of the Company's repurchase obligations, those institutions preserve their right to require repurchases arising from certain types of events, and that preservation of rights can impact future losses of the Company. While the mortgage repurchase reserve includes the estimated cost of settling claims related to required repurchases, the Company's estimate of losses depends on its assumptions regarding GSE and other counterparty behavior, loan performance, home prices, and other factors. The liability is recorded in other liabilities on the Consolidated Balance Sheets, and the related repurchase (benefit)/provision is recognized in mortgage production related income in the Consolidated Statements of Income. See Note 19, "Contingencies," for additional information on current legal matters related to loan sales.

The following table summarizes the carrying value of the Company's outstanding repurchased mortgage loans at December 31:



(Dollars in millions)	2016		2015
Outstanding repurchased mortgage loans:
Performing LHFI		$230		$255
Nonperforming LHFI	12		17
Total carrying value of outstanding repurchased mortgage loans		$242		$272

In addition to representations and warranties related to loan sales, the Company makes representations and warranties that it will service the loans in accordance with investor servicing guidelines and standards, which may include (i) collection and remittance of principal and interest, (ii) administration of escrow for taxes and insurance, (iii) advancing principal, interest, taxes, insurance, and collection expenses on delinquent accounts, (iv) loss mitigation strategies including loan modifications, and (v) foreclosures.

The Company normally retains servicing rights when loans are transferred; however, servicing rights are occasionally sold to third parties. When servicing rights are sold, the Company makes representations and warranties related to servicing standards and obligations, and records a liability for contingent losses in other liabilities on the Consolidated Balance Sheets. This liability, which is separate from the mortgage repurchase reserve and separate from the commercial mortgage loan loss share guarantee described below, totaled $7 million and $14 million at December 31, 2016 and 2015, respectively.

Commercial Mortgage Loan Loss Share Guarantee

In connection with the December 2016 acquisition of Pillar, the Company assumed a loss share obligation associated with the terms of a master loss sharing agreement with Fannie Mae for multi-family commercial mortgage loans that were sold by Pillar to Fannie Mae under Fannie Mae’s delegated underwriting and servicing program. Upon the acquisition of Pillar, the Company entered into a lender contract amendment with Fannie Mae for multi-family commercial mortgage loans that Pillar sold to Fannie Mae prior to acquisition and that the Company sold to Fannie Mae subsequent to acquisition, whereby the Company bears a risk of loss of up to one-third of the incurred losses resulting from borrower defaults. The breach of any representation or warranty related to a loan sold to Fannie Mae could increase the Company's level of risk-sharing associated with the loan. At December 31, 2016, the outstanding UPB of loans sold subject to the loss share guarantee was $2.9 billion and the potential maximum exposure to loss was $787 million. Using probability of default and severity of loss estimates, the Company recorded the estimated fair value of the loss share liability of $6 million in other liabilities at the acquisition date, which was also the liability at December 31, 2016.

Visa

The Company executes credit and debit transactions through Visa and MasterCard. The Company is a defendant, along with Visa and MasterCard (the “Card Associations”), as well as several other banks, in one of several antitrust lawsuits challenging the practices of the Card Associations (the “Litigation”). The Company entered into judgment and loss sharing agreements with Visa and certain other banks in order to apportion financial responsibilities arising from any potential adverse judgment or negotiated settlements related to the Litigation. Additionally, in connection with Visa's restructuring in 2007, shares of Visa common stock were issued to its financial institution members and the Company received its proportionate number of shares of Visa Inc. common stock, which were subsequently converted to Class B shares of Visa Inc. upon completion of Visa’s IPO in 2008. A provision of the original Visa By-Laws, which was restated in Visa's certificate of incorporation, contains a general indemnification provision between a Visa member and Visa that explicitly provides that each member's indemnification obligation is limited to losses arising from its own conduct and the specifically defined Litigation. While the district court approved a class action settlement of the Litigation in 2012, the U.S. Court of Appeals for the Second Circuit reversed the district court's approval of the settlement on June 30, 2016. The parties await further action on the appeal and/or a return of the case to the district court.

Agreements associated with Visa's IPO have provisions that Visa will fund a litigation escrow account, established for the purpose of funding judgments in, or settlements of, the Litigation. If the escrow account is insufficient to cover the Litigation losses, then Visa will issue additional Class A shares (“loss shares”). The proceeds from the sale of the loss shares would then be deposited in the escrow account. The issuance of the loss shares will cause a dilution of Visa's Class B shares as a result of an adjustment to lower the conversion factor of the Class B shares to Class A shares. Visa U.S.A.'s members are responsible for any portion of the settlement or loss on the Litigation after the escrow account is depleted and the value of the Class B shares is fully diluted.

In May 2009, the Company sold its 3.2 million Class B shares to the Visa Counterparty and entered into a derivative with the Visa Counterparty. Under the derivative, the Visa Counterparty is compensated by the Company for any decline in the conversion factor as a result of the outcome of the Litigation. Conversely, the Company is compensated by the Visa Counterparty for any increase in the conversion factor. The amount of payments made or received under the derivative is a function of the 3.2 million shares sold to the Visa Counterparty, the change in conversion rate, and Visa’s share price. The Visa Counterparty, as a result of its ownership of the Class B shares, is impacted by dilutive adjustments to the conversion factor of the Class B shares caused by the Litigation losses. Additionally, the Company will make periodic payments based on the notional of the derivative and a fixed rate until the date on which the Litigation is settled. The fair value of the derivative is estimated based on unobservable inputs consisting of management's estimate of the probability of certain litigation scenarios and the timing of the resolution of the Litigation due in large part to the aforementioned decision by the U.S. Court of Appeals for the Second Circuit. The fair value of the derivative liability was $15 million and $6 million at December 31, 2016 and 2015, respectively. The increase in fair value of the derivative liability was driven by changes in management's estimate of both the probability of certain litigation scenarios as well as the timing of the resolution of the Litigation. However, the ultimate impact to the Company could be significantly different based on the Litigation outcome.

Public Deposits

The Company holds public deposits from various states in which it does business. Individual state laws require banks to collateralize public deposits, typically as a percentage of their public deposit balance in excess of FDIC insurance and may also require a cross-guarantee among all banks holding public deposits of the individual state. The amount of collateral required varies by state and may also vary by bank within each state, depending on the individual state's risk assessment of each participating bank. Certain of the states in which the Company holds public deposits use a pooled collateral method, whereby in the event of default of a bank holding public deposits, the collateral of the defaulting bank is liquidated to the extent necessary to recover the loss of public deposits of the defaulting bank. To the extent the collateral is insufficient, the remaining public deposit balances of the defaulting bank are recovered through an assessment of the other banks holding public deposits in that state. The maximum potential amount of future payments the Company could be required to make is dependent on a variety of factors, including the amount of public funds held by banks in the states in which the Company also holds public deposits and the amount of collateral coverage associated with any defaulting bank. Individual states appear to be monitoring this risk and evaluating collateral requirements; therefore, the likelihood that the Company would have to perform under this guarantee is dependent on whether any banks holding public funds default as well as the adequacy of collateral coverage.

Other

In the normal course of business, the Company enters into indemnification agreements and provides standard representations and warranties in connection with numerous transactions. These transactions include those arising from securitization activities, underwriting agreements, merger and acquisition agreements, swap clearing agreements, loan sales, contractual commitments, payment processing, sponsorship agreements, and various other business transactions or arrangements. The extent of the Company's obligations under these indemnification agreements depends upon the occurrence of future events; therefore, the Company's potential future liability under these arrangements is not determinable. STIS and STRH, broker-dealer affiliates of the Company, use a common third party clearing broker to clear and execute their customers' securities transactions and to hold customer accounts. Under their respective agreements, STIS and STRH agree to indemnify the clearing broker for losses that result from a customer's failure to fulfill its contractual obligations. As the clearing broker's rights to charge STIS and STRH have no maximum amount, the Company believes that the maximum potential obligation cannot be estimated. However, to mitigate exposure, the affiliate may seek recourse from the customer through cash or securities held in the defaulting customers' account. For the years ended December 31, 2016, 2015, and 2014, STIS and STRH experienced minimal net losses as a result of the indemnity. The clearing agreements expire in May 2020 for both STIS and STRH.

Derivative Financial Instruments

NOTE 17 - DERIVATIVE FINANCIAL INSTRUMENTS

The Company enters into various derivative financial instruments, both in a dealer capacity to facilitate client transactions and as an end user as a risk management tool. The ALCO monitors all risk management derivative activities. When derivatives have been entered into with clients, the Company generally manages the risk associated with these derivatives within the framework of its VAR methodology that monitors total daily exposure and seeks to manage the exposure on an overall basis. Derivatives are also used as a risk management tool to hedge the Company’s balance sheet exposure to changes in identified cash flow and fair value risks, either economically or in accordance with hedge accounting provisions. The Company’s Corporate Treasury function is responsible for employing the various hedge strategies to manage these objectives. Additionally, as a normal part of its operations, the Company enters into IRLCs on residential and commercial mortgage loans that are accounted for as freestanding derivatives and has certain contracts containing embedded derivatives that are measured, in their entirety, at fair value. All freestanding derivatives and any embedded derivatives that the Company bifurcates from the host contracts are measured at fair value in the Consolidated Balance Sheets in trading assets and derivative instruments and trading liabilities and derivative instruments. The associated gains and losses are either recognized in AOCI, net of tax, or within the Consolidated Statements of Income, depending upon the use and designation of the derivatives.

Credit and Market Risk Associated with Derivative Instruments

Derivatives expose the Company to risk that the counterparty to the derivative contract does not perform as expected. The Company manages its exposure to counterparty credit risk associated with derivatives by entering into transactions with counterparties with defined exposure limits based on their credit quality and in accordance with established policies and procedures. All counterparties are reviewed regularly as part of the Company’s credit risk management practices and appropriate action is taken to adjust the exposure to certain counterparties as necessary. The Company’s derivative transactions may also be governed by ISDA agreements or other legally enforceable industry standard master netting agreements. In certain cases and depending on the nature of the underlying derivative transactions, bilateral collateral agreements are also utilized. Furthermore, the Company and its subsidiaries are subject to OTC derivative clearing requirements, which require certain derivatives to be cleared through central clearinghouses. These clearinghouses require the Company to post initial and variation margin to mitigate the risk of non-payment, the latter of which is received or paid daily based on the net asset or liability position of the contracts.

When the Company has more than one outstanding derivative transaction with a single counterparty, and there exists a legal right of offset with that counterparty, the Company considers its exposure to the counterparty to be the net fair value of its derivative positions with that counterparty. If the net fair value is positive, then the corresponding asset value also reflects cash collateral held. At December 31, 2016, these net asset positions were $774 million, reflecting $1.1 billion of net derivative gains, adjusted for cash and other collateral of $339 million that the Company held in relation to these positions. At December 31, 2015, reported net derivative assets were $896 million, reflecting $1.4 billion of net derivative gains, adjusted for cash and other collateral held of $463 million.

Derivatives also expose the Company to market risk arising from the adverse effects that changes in market factors, such as interest rates, currency rates, equity prices, commodity prices, or implied volatility, may have on the value of a derivative. The Company manages this risk by establishing and monitoring limits on the types and degree of risk that may be undertaken. The Company measures its market risk exposure using a VAR methodology for derivatives designated as trading instruments. Other tools and risk measures are also used to actively manage risk associated with derivatives including scenario analysis and stress testing.

Derivative instruments are priced using observable market inputs at a mid-market valuation point and take into consideration appropriate valuation adjustments for collateral, market liquidity, and counterparty credit risk. For purposes of determining fair value adjustments to its OTC derivative positions, the Company takes into consideration the credit profile and likelihood of default by counterparties and itself, as well as its net exposure, which considers legally enforceable master netting agreements and collateral along with remaining maturities. The expected loss of each counterparty is estimated using market-based views of counterparty default probabilities observed in the single-name CDS market, when available and of sufficient liquidity. When single-name CDS market data is not available or not of sufficient liquidity, the probability of default is estimated using a combination of the Company's internal risk rating system and sector/rating based CDS data.

For purposes of estimating the Company’s own credit risk on derivative liability positions, the DVA, the Company uses probabilities of default from observable, sector/rating based CDS data. The Company adjusted the net fair value of its derivative contracts for estimates of counterparty credit risk by approximately $6 million and $4 million at December 31, 2016 and 2015, respectively. For additional information on the Company's fair value measurements, see Note 18, "Fair Value Election and Measurement."

Currently, the majority of the Company’s derivatives contain contingencies that relate to the creditworthiness of the Bank. These contingencies, which are contained in industry standard master netting agreements, may be considered events of default. Should the Bank be in default under any of these provisions, the Bank’s counterparties would be permitted to close out transactions with the Bank on a net basis, at amounts that would approximate the fair values of the derivatives, resulting in a single sum due by one party to the other. The counterparties would have the right to apply any collateral posted by the Bank against any net amount owed by the Bank. Additionally, certain of the Company’s derivative liability positions, totaling $1.1 billion in fair value at both December 31, 2016 and 2015, contain provisions conditioned on downgrades of the Bank’s credit rating. These provisions, if triggered, would either give rise to an ATE that permits the counterparties to close-out net and apply collateral or, where a CSA is present, require the Bank to post additional collateral. At December 31, 2016, the Bank held senior long-term debt credit ratings of Baal/A-/A- from Moody’s, S&P, and Fitch, respectively. At December 31, 2016, ATEs have been triggered for less than $1 million in fair value liabilities. The maximum additional liability that could be triggered from ATEs was approximately $13 million at December 31, 2016. At December 31, 2016, $1.1 billion in fair value of derivative liabilities were subject to CSAs, against which the Bank has posted $1.1 billion in collateral, primarily in the form of cash. If requested by the counterparty pursuant to the terms of the CSA, the Bank would be required to post additional collateral of approximately $5 million against these contracts if the Bank were downgraded to Baa3/BBB-. Further downgrades to Ba1/BB+ or below do not contain predetermined collateral posting levels.

Notional and Fair Value of Derivative Positions

The following tables present the Company’s derivative positions at December 31, 2016 and 2015. The notional amounts in the tables are presented on a gross basis and have been classified within derivative assets or derivative liabilities based on the estimated fair value of the individual contract at December 31, 2016 and 2015. Gross positive and gross negative fair value amounts associated with respective notional amounts are presented without consideration of any netting agreements, including collateral arrangements. Net fair value derivative amounts are adjusted on an aggregate basis, where applicable, to take into consideration the effects of legally enforceable master netting agreements, including any cash collateral received or paid, and are recognized in trading assets and derivative instruments or trading liabilities and derivative instruments on the Consolidated Balance Sheets. For contracts constituting a combination of options that contain a written option and a purchased option (such as a collar), the notional amount of each option is presented separately, with the purchased notional amount generally being presented as a derivative asset and the written notional amount being presented as a derivative liability. For contracts that contain a combination of options, the fair value is generally presented as a single value with the purchased notional amount if the combined fair value is positive, and with the written notional amount if the combined fair value is negative.



	December 31, 2016
	Asset Derivatives					Liability Derivatives
(Dollars in millions)	Notional Amounts		Fair Value			Notional Amounts		Fair Value
Derivative instruments designated in cash flow hedging relationships ¹
Interest rate contracts hedging floating rate loans		$6,400		$34			$11,050		$265
Derivative instruments designated in fair value hedging relationships ²
Interest rate contracts hedging fixed rate debt	600		2			4,510		81
Interest rate contracts hedging brokered CDs	60		—			30		—
Total	660		2			4,540		81
Derivative instruments not designated as hedging instruments ³
Interest rate contracts hedging:
MSRs ⁴	12,165		413			18,774		335
LHFS, IRLCs ⁵	11,774		134			8,306		58
LHFI	100		2			36		1
Trading activity ⁶	70,599		1,536			67,477		1,401
Foreign exchange rate contracts hedging trading activity	3,231		161			3,360		148
Credit contracts hedging:
Loans	15		—			620		8
Trading activity ⁷	2,128		34			2,271		33
Equity contracts hedging trading activity ⁶	23,164		2,095			35,312		2,477
Other contracts:
IRLCs and other ⁸	2,412		28			668		22
Commodities	747		75			746		73
Total	126,335		4,478			137,570		4,556
Total derivative instruments		$133,395		$4,514			$153,160		$4,902

Total gross derivative instruments, before netting				$4,514					$4,902
Less: Legally enforceable master netting agreements			(3,239		)			(3,239		)
Less: Cash collateral received/paid			(291		)			(1,265		)
Total derivative instruments, after netting				$984					$398

¹See “Cash Flow Hedges” in this Note for further discussion.

² See “Fair Value Hedges” in this Note for further discussion.

³ See “Economic Hedging and Trading Activities” in this Note for further discussion.

⁴ Amount includes $6.7 billion of notional amounts related to interest rate futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table.

⁵ Amount includes $720 million of notional amounts related to interest rate futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table.

⁶ Amounts include $12.3 billion of notional amounts related to interest rate futures and $629 million of notional amounts related to equity futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table. Amounts also include notional amounts related to interest rate swaps hedging fixed rate debt.

⁷ Asset and liability amounts include $5 million and $13 million, respectively, of notional amounts from purchased and written credit risk participation agreements, whose notional is calculated as the notional of the derivative participated adjusted by the relevant RWA conversion factor.

⁸ Includes $49 million notional amount that is based on the 3.2 million of Visa Class B shares, the conversion ratio from Class B shares to Class A shares, and the Class A share price at the derivative inception date of May 28, 2009. This derivative was established upon the sale of Class B shares in the second quarter of 2009. See Note 16, “Guarantees” for additional information.



	December 31, 2015
	Asset Derivatives					Liability Derivatives
(Dollars in millions)	Notional Amounts		Fair Value			Notional Amounts		Fair Value
Derivative instruments designated in cash flow hedging relationships ¹
Interest rate contracts hedging floating rate loans		$14,500		$130			$2,900		$11
Derivative instruments designated in fair value hedging relationships ²
Interest rate contracts hedging fixed rate debt	1,700		14			600		—
Interest rate contracts hedging brokered CDs	60		—			30		—
Total	1,760		14			630		—
Derivative instruments not designated as hedging instruments³
Interest rate contracts hedging:
MSRs ⁴	7,782		198			16,882		98
LHFS, IRLCs ⁵	4,309		10			2,520		5
LHFI	15		—			40		1
Trading activity ⁶	67,164		1,983			66,854		1,796
Foreign exchange rate contracts hedging trading activity	3,648		127			3,227		122
Credit contracts hedging:
Loans	—		—			175		2
Trading activity ⁷	2,232		57			2,385		54
Equity contracts hedging trading activity ⁶	19,138		1,812			27,154		2,222
Other contracts:
IRLCs and other ⁸	2,024		21			299		6
Commodities	453		113			448		111
Total	106,765		4,321			119,984		4,417
Total derivative instruments		$123,025		$4,465			$123,514		$4,428

Total gross derivative instruments, before netting				$4,465					$4,428
Less: Legally enforceable master netting agreements			(2,916		)			(2,916		)
Less: Cash collateral received/paid			(397		)			(1,048		)
Total derivative instruments, after netting				$1,152					$464

¹See “Cash Flow Hedges” in this Note for further discussion.

² See “Fair Value Hedges” in this Note for further discussion.

³See “Economic Hedging and Trading Activities” in this Note for further discussion.

⁴ Amount includes $9.1 billion of notional amounts related to interest rate futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table.

⁵ Amount includes $518 million of notional amounts related to interest rate futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table.

⁶ Amounts include $12.6 billion of notional amounts related to interest rate futures and $329 million of notional amounts related to equity futures. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table. Amounts also include notional amounts related to interest rate swaps hedging fixed rate debt.

⁷ Asset and liability amounts include $6 million and $9 million, respectively, of notional amounts from purchased and written credit risk participation agreements, whose notional is calculated as the notional of the derivative participated adjusted by the relevant RWA conversion factor.

⁸ Includes $49 million notional amount that is based on the 3.2 million of Visa Class B shares, the conversion ratio from Class B shares to Class A shares, and the Class A share price at the derivative inception date of May 28, 2009. This derivative was established upon the sale of Class B shares in the second quarter of 2009. See Note 16, “Guarantees” for additional information.

Impact of Derivative Instruments on the Consolidated Statements of Income and Shareholders’ Equity

The impacts of derivative instruments on the Consolidated Statements of Income and the Consolidated Statements of Shareholders’ Equity for the year ended December 31 are presented in the following tables. The impacts are segregated between derivatives that are designated in hedge accounting relationships and those that are used for economic hedging or trading purposes, with further identification of the underlying risks in the derivatives and the hedged items, where appropriate. The tables do not disclose the financial impact of the activities that these derivative instruments are intended to hedge.



	Year Ended December 31, 2016
(Dollars in millions)	Amount of Pre-tax Loss Recognized in OCI on Derivatives (Effective Portion)			Amount of Pre-tax Gain Reclassified from AOCI into Income (Effective Portion)		Classification of Pre-tax Gain/(Loss) Reclassified from AOCI into Income (Effective Portion)
Derivative instruments in cash flow hedging relationships:
Interest rate contracts hedging floating rate loans¹		($145	)		$147	Interest and fees on loans

¹During the year ended December 31, 2016, the Company also reclassified $97 million of pre-tax gains from AOCI into net interest income. These gains related to hedging relationships that have been terminated or de-designated and are reclassified into earnings consistent with the pattern of net cash flows expected to be recognized.



	Year Ended December 31, 2016
(Dollars in millions)	Amount of Loss on Derivatives Recognized in Income			Amount of Gain on Related Hedged Items Recognized in Income		Amount of Gain Recognized in Income on Hedges (Ineffective Portion)
Derivative instruments in fair value hedging relationships:
Interest rate contracts hedging fixed rate debt ¹		($87	)		$89		$2
Interest rate contracts hedging brokered CDs ¹	—			—		—
Total		($87	)		$89		$2

¹Amounts are recognized in trading income in the Consolidated Statements of Income.



(Dollars in millions)	Classification of Gain/(Loss) Recognized in Income on Derivatives	Amount of Gain/(Loss) Recognized in Income on Derivatives During the Year Ended December 31, 2016
Derivative instruments not designated as hedging instruments:
Interest rate contracts hedging:
MSRs	Mortgage servicing related income		$62
LHFS, IRLCs	Mortgage production related income	(6		)
LHFI	Other noninterest income	(1		)
Trading activity	Trading income	51
Foreign exchange rate contracts hedging trading activity	Trading income	101
Credit contracts hedging:
Loans	Other noninterest income	(3		)
Trading activity	Trading income	19
Equity contracts hedging trading activity	Trading income	4
Other contracts:
IRLCs	Mortgage production related income	210
Commodities	Trading income	3
Total			$440



	Year Ended December 31, 2015
(Dollars in millions)	Amount of Pre-tax Gain Recognized in OCI on Derivatives (Effective Portion)		Amount of Pre-tax Gain Reclassified from AOCI into Income (Effective Portion)		Classification of Pre-tax Gain Reclassified from AOCI into Income (Effective Portion)
Derivative instruments in cash flow hedging relationships:
Interest rate contracts hedging floating rate loans¹		$246		$169	Interest and fees on loans

¹During the year ended December 31, 2015, the Company also reclassified $92 million of pre-tax gains from AOCI into net interest income. These gains related to hedging relationships that have been terminated or de-designated and are reclassified into earnings consistent with the pattern of net cash flows expected to be recognized.



	Year Ended December 31, 2015
(Dollars in millions)	Amount of Loss on Derivatives Recognized in Income			Amount of Gain on Related Hedged Items Recognized in Income		Amount of Loss Recognized in Income on Hedges (Ineffective Portion)
Derivative instruments in fair value hedging relationships:
Interest rate contracts hedging fixed rate debt ¹		($2	)		$1		($1	)
Interest rate contracts hedging brokered CDs ¹	—			—		—
Total		($2	)		$1		($1	)

¹Amounts are recognized in trading income in the Consolidated Statements of Income.



(Dollars in millions)	Classification of Gain/(Loss) Recognized in Income on Derivatives	Amount of Gain/(Loss) Recognized in Income on Derivatives During the Year Ended December 31, 2015
Derivative instruments not designated as hedging instruments:
Interest rate contracts hedging:
MSRs	Mortgage servicing related income		$19
LHFS, IRLCs	Mortgage production related income	(45		)
LHFI	Other noninterest income	(1		)
Trading activity	Trading income	61
Foreign exchange rate contracts hedging trading activity	Trading income	93
Credit contracts hedging:
Loans	Other noninterest income	(1		)
Trading activity	Trading income	23
Equity contracts hedging trading activity	Trading income	4
Other contracts:
IRLCs	Mortgage production related income	156
Commodities	Trading income	2
Total			$311



	Year Ended December 31, 2014
(Dollars in millions)	Amount of Pre-tax Gain Recognized in OCI on Derivatives (Effective Portion)		Amount of Pre-tax Gain Reclassified from AOCI into Income (Effective Portion)		Classification of Pre-tax Gain Reclassified from AOCI into Income (Effective Portion)
Derivative instruments in cash flow hedging relationships:
Interest rate contracts hedging floating rate loans¹		$99		$290	Interest and fees on loans

¹During the year ended December 31, 2014, the Company also reclassified $97 million pre-tax gains from AOCI into net interest income. These gains related to hedging relationships that have been previously terminated or de-designated and are reclassified into earnings consistent with the pattern of net cash flows expected to be recognized.



	Year Ended December 31, 2014
(Dollars in millions)	Amount of Gain on Derivatives Recognized in Income		Amount of Loss on Related Hedged Items Recognized in Income			Amount of Gain Recognized in Income on Hedges (Ineffective Portion)
Derivative instruments in fair value hedging relationships:
Interest rate contracts hedging fixed rate debt ¹		$8		($7	)		$1
Interest rate contracts hedging brokered CDs ¹	—		—			—
Total		$8		($7	)		$1

¹Amounts are recognized in trading income in the Consolidated Statements of Income.



(Dollars in millions)	Classification of Gain/(Loss) Recognized in Income on Derivatives	Amount of Gain/(Loss) Recognized in Income on Derivatives During the Year Ended December 31, 2014
Derivative instruments not designated as hedging instruments:
Interest rate contracts hedging:
MSRs	Mortgage servicing related income		$257
LHFS, IRLCs	Mortgage production related income	(149		)
Trading activity	Trading income	49
Foreign exchange rate contracts hedging trading activity	Trading income	69
Credit contracts hedging:
Loans	Other noninterest income	(1		)
Trading activity	Trading income	17
Equity contracts hedging trading activity	Trading income	4
Other contracts - IRLCs	Mortgage production related income	261
Total			$507

Netting of Derivative Instruments

The Company has various financial assets and financial liabilities that are subject to enforceable master netting agreements or similar agreements. The Company's securities borrowed or purchased under agreements to resell, and securities sold under agreements to repurchase, that are subject to enforceable master netting agreements or similar agreements, are discussed in Note 3, "Federal Funds Sold and Securities Financing Activities." The Company enters into ISDA or other legally enforceable industry standard master netting agreements with derivative counterparties. Under the terms of the master netting agreements, all transactions between the Company and the counterparty constitute a single business relationship such that in the event of default, the nondefaulting party is entitled to set off claims and apply property held by that party in respect of any transaction against obligations owed. Any payments, deliveries, or other transfers may be applied against each other and netted.

The following tables present total gross derivative instrument assets and liabilities at December 31, 2016 and 2015, which are adjusted to reflect the effects of legally enforceable master netting agreements and cash collateral received or paid when calculating the net amount reported in the Consolidated Balance Sheets. Also included in the tables are financial instrument collateral related to legally enforceable master netting agreements that represents securities collateral received or pledged and customer cash collateral held at third party custodians. These amounts are not offset on the Consolidated Balance Sheets but are shown as a reduction to total derivative instrument assets and liabilities to derive net derivative assets and liabilities. These amounts are limited to the derivative asset/liability balance, and accordingly, do not include excess collateral received/pledged.



(Dollars in millions)	Gross Amount		Amount Offset		Net Amount Presented in Consolidated Balance Sheets			Held/Pledged Financial Instruments		Net Amount
December 31, 2016
Derivative instrument assets:
Derivatives subject to master netting arrangement or similar arrangement		$4,193		$3,384		$809			$48		$761
Derivatives not subject to master netting arrangement or similar arrangement	27		—		27			—		27
Exchange traded derivatives	294		146		148			—		148
Total derivative instrument assets		$4,514		$3,530		$984	¹		$48		$936

Derivative instrument liabilities:
Derivatives subject to master netting arrangement or similar arrangement		$4,649		$4,358		$291			$33		$258
Derivatives not subject to master netting arrangement or similar arrangement	105		—		105			—		105
Exchange traded derivatives	148		146		2			—		2
Total derivative instrument liabilities		$4,902		$4,504		$398	²		$33		$365

December 31, 2015
Derivative instrument assets:
Derivatives subject to master netting arrangement or similar arrangement		$4,184		$3,156		$1,028			$66		$962
Derivatives not subject to master netting arrangement or similar arrangement	21		—		21			—		21
Exchange traded derivatives	260		157		103			—		103
Total derivative instrument assets		$4,465		$3,313		$1,152	¹		$66		$1,086

Derivative instrument liabilities:
Derivatives subject to master netting arrangement or similar arrangement		$4,162		$3,807		$355			$19		$336
Derivatives not subject to master netting arrangement or similar arrangement	105		—		105			—		105
Exchange traded derivatives	161		157		4			—		4
Total derivative instrument liabilities		$4,428		$3,964		$464	²		$19		$445

¹ At December 31, 2016, $984 million, net of $291 million offsetting cash collateral, is recognized in trading assets and derivative instruments within the Company's Consolidated Balance Sheets. At December 31, 2015, $1.2 billion, net of $397 million offsetting cash collateral, is recognized in trading assets and derivative instruments within the Company's Consolidated Balance Sheets.

² At December 31, 2016, $398 million, net of $1.3 billion offsetting cash collateral, is recognized in trading liabilities and derivative instruments within the Company's Consolidated Balance Sheets. At December 31, 2015, $464 million, net of $1.0 billion offsetting cash collateral, is recognized in trading liabilities and derivative instruments within the Company's Consolidated Balance Sheets.

Credit Derivative Instruments

As part of the Company's trading businesses, the Company enters into contracts that are, in form or substance, written guarantees; specifically, CDS, risk participations, and TRS. The Company accounts for these contracts as derivatives, and accordingly, records these contracts at fair value, with changes in fair value recognized in trading income in the Consolidated Statements of Income.

At December 31, 2016 and 2015, the gross notional amounts of purchased CDS contracts designated as trading instruments were $135 million and $150 million, respectively. The fair values of purchased CDS were $3 million and $1 million at December 31, 2016 and 2015, respectively.

The Company has also entered into TRS contracts on loans. The Company’s TRS business consists of matched trades, such that when the Company pays depreciation on one TRS, it receives the same amount on the matched TRS. To mitigate its credit risk, the Company typically receives initial cash collateral from the counterparty upon entering into the TRS and is entitled to additional collateral if the fair value of the underlying reference assets deteriorates. There were $2.1 billion and $2.2 billion of outstanding TRS notional balances at December 31, 2016 and 2015, respectively. The fair values of these TRS assets and liabilities at December 31, 2016 were $34 million and $31 million, respectively, and related collateral held at December 31, 2016 was $450 million. The fair values of the TRS assets and liabilities at December 31, 2015 were $57 million and $52 million, respectively, and related collateral held at December 31, 2015 was $492 million. For additional information on the Company's TRS contracts, see Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," as well as Note 18, "Fair Value Election and Measurement."

The Company writes risk participations, which are credit derivatives, whereby the Company has guaranteed payment to a dealer counterparty in the event the counterparty experiences a loss on a derivative, such as an interest rate swap, due to a failure to pay by the counterparty’s customer (the “obligor”) on that derivative. The Company manages its payment risk on its risk participations by monitoring the creditworthiness of the obligors, which are all corporations or partnerships, through the normal credit review process that the Company would have performed had it entered into a derivative directly with the obligors. To date, no material losses have been incurred related to the Company’s written risk participations. At December 31, 2016, the remaining terms on these risk participations generally ranged from less than one year to thirty-one years, with a weighted average term on the maximum estimated exposure of 8.5 years. At December 31, 2015, the remaining terms on these risk participations generally ranged from less than one year to eight years, with a weighted average term on the maximum estimated exposure of 5.6 years. The Company’s maximum estimated exposure to written risk participations, as measured by projecting a maximum value of the guaranteed derivative instruments based on interest rate curve simulations and assuming 100% default by all obligors on the maximum values, was approximately $95 million and $55 million at December 31, 2016 and 2015, respectively. The fair values of the written risk participations were immaterial at both December 31, 2016 and 2015. The Company may enter into purchased risk participations to mitigate this written credit risk exposure to a derivative counterparty.

Cash Flow Hedging Instruments

The Company utilizes a comprehensive risk management strategy to monitor sensitivity of earnings to movements in interest rates. Specific types of funding and principal amounts hedged are determined based on prevailing market conditions and the shape of the yield curve. In conjunction with this strategy, the Company may employ various interest rate derivatives as risk management tools to hedge interest rate risk from recognized assets and liabilities or from forecasted transactions. The terms and notional amounts of derivatives are determined based on management’s assessment of future interest rates, as well as other factors.

Interest rate swaps have been designated as hedging the exposure to the benchmark interest rate risk associated with floating rate loans. At December 31, 2016, the maturities for hedges of floating rate loans ranged from less than one year to six years, with the weighted average being 4.1 years. At December 31, 2015, the maturities for hedges of floating rate loans ranged from less than one year to seven years, with the weighted average being 3.3 years. These hedges have been highly effective in offsetting the designated risks, yielding an immaterial amount of ineffectiveness for the years ended December 31, 2016 and 2015. At December 31, 2016, $138 million of deferred net pre-tax gains on derivative instruments designated as cash flow hedges on floating rate loans recognized in AOCI are expected to be reclassified into net interest income during the next twelve months. The amount to be reclassified into income incorporates the impact from both active and terminated or de-designated cash flow hedges, including the net interest income earned on the active hedges, assuming no changes in LIBOR. The Company may choose to terminate or de-designate a hedging relationship due to a change in the risk management objective for that specific hedge item, which may arise in conjunction with an overall balance sheet management strategy.

Fair Value Hedging Instruments

The Company enters into interest rate swap agreements as part of the Company’s risk management objectives for hedging its exposure to changes in fair value due to changes in interest rates. These hedging arrangements convert certain fixed rate long-term debt and CDs to floating rates. Consistent with this objective, the Company reflects the accrued contractual interest on the hedged item and the related swaps as part of current period interest expense. There were no components of derivative gains or losses excluded in the Company’s assessment of hedge effectiveness related to the fair value hedges.

Economic Hedging Instruments and Trading Activities

In addition to designated hedge accounting relationships, the Company also enters into derivatives as an end user to economically hedge risks associated with certain non-derivative and derivative instruments, along with entering into derivatives in a trading capacity with its clients.

The primary risks that the Company economically hedges are interest rate risk, foreign exchange risk, and credit risk. The Company mitigates these risks by entering into offsetting derivatives either on an individual basis or collectively on a macro basis.

The Company utilizes interest rate derivatives related to:


•	Residential MSRs. The Company hedges these instruments with a combination of interest rate derivatives, including forward and option contracts, futures, and forward rate agreements.


•	Residential mortgage IRLCs and LHFS. The Company hedges these instruments using forward and option contracts, futures, and forward rate agreements.

The Company is exposed to volatility and changes in foreign exchange rates associated with certain commercial loans. To hedge against this foreign exchange rate risk, the Company enters into foreign exchange rate contracts that provide for the future receipt and delivery of foreign currency at previously agreed-upon terms.

The Company enters into CDS to hedge credit risk associated with certain loans held within its Wholesale Banking segment. The Company accounts for these contracts as derivatives, and accordingly, recognizes these contracts at fair value, with changes in fair value recognized in other noninterest income in the Consolidated Statements of Income.

Trading activity primarily includes interest rate swaps, equity derivatives, CDS, futures, options, foreign currency contracts, and commodities. These derivatives are entered into in a dealer capacity to facilitate client transactions, or are utilized as a risk management tool by the Company as an end user (predominantly in certain macro-hedging strategies). The macro-hedging strategies are focused on managing the Company’s overall interest rate risk exposure that is not otherwise hedged by derivatives or in connection with specific hedges.

Fair Value Election and Measurement

NOTE 18 - FAIR VALUE ELECTION AND MEASUREMENT

The Company measures certain assets and liabilities at fair value, which are classified as level 1, 2, or 3 within the fair value hierarchy, as shown below, on the basis of whether the measurement employs observable or unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s own assumptions, taking into account information about market participant assumptions that is readily available.


•	Level 1: Quoted prices for identical instruments in active markets


•	Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets


•	Level 3: Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable

Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The Company’s recurring fair value measurements are based on either a requirement to measure such assets and liabilities at fair value or on the Company’s election to measure certain financial assets and liabilities at fair value. Assets and liabilities that are required to be measured at fair value on a recurring basis include trading securities, securities AFS, and derivative financial instruments. Assets and liabilities that the Company has elected to measure at fair value on a recurring basis include MSRs and certain LHFS, LHFI, trading loans, brokered time deposits, and issuances of fixed rate debt.

The Company elects to measure certain assets and liabilities at fair value to better align its financial performance with the economic value of actively traded or hedged assets or liabilities. The use of fair value also enables the Company to mitigate non-economic earnings volatility caused from financial assets and liabilities being measured using different bases of accounting, as well as to more accurately portray the active and dynamic management of the Company’s balance sheet.

The Company uses various valuation techniques and assumptions in estimating fair value. The assumptions used to estimate the value of an instrument have varying degrees of impact to the overall fair value of an asset or liability. This process involves gathering multiple sources of information, including broker quotes, values provided by pricing services, trading activity in other identical or similar securities, market indices, and pricing matrices. When observable market prices for the asset or liability are not available, the Company employs various modeling techniques, such as discounted cash flow analyses, to estimate fair value. Models used to produce material financial reporting information are validated prior to use and following any material change in methodology. Their performance is monitored at least quarterly, and any material deterioration in model performance is escalated. This review is performed by different internal groups depending on the type of fair value asset or liability.

The Company has formal processes and controls in place to support the appropriateness of its fair value estimates. For fair values obtained from a third party, or those that include certain trader estimates of fair value, there is an independent price validation function that provides oversight for these estimates. For level 2 instruments and certain level 3 instruments, the validation generally involves evaluating pricing received from two or more third party pricing sources that are widely used by market participants. The Company evaluates this pricing information from both a qualitative and quantitative perspective and determines whether any pricing differences exceed acceptable thresholds. If thresholds are exceeded, the Company assesses differences in valuation approaches used, which may include contacting a pricing service to gain further insight into the valuation of a particular security or class of securities to resolve the pricing variance, which could include an adjustment to the price used for financial reporting purposes.

The Company classifies instruments within level 2 in the fair value hierarchy when it determines that external pricing sources estimated fair value using prices for similar instruments trading in active markets. A wide range of quoted values from pricing sources may imply a reduced level of market activity and indicate that significant adjustments to price indications have been made. In such cases, the Company evaluates whether the asset or liability should be classified as level 3.

Determining whether to classify an instrument as level 3 involves judgment and is based on a variety of subjective factors, including whether a market is inactive. A market is considered inactive if significant decreases in the volume and level of activity for the asset or liability have been observed. In making this determination the Company evaluates the number of recent transactions in either the primary or secondary market, whether or not price quotations are current, the nature of market participants, the variability of price quotations, the breadth of bid/ask spreads, declines in, or the absence of, new issuances, and the availability of public information. When a market is determined to be inactive, significant adjustments may be made to price indications when estimating fair value. In making these adjustments the Company seeks to employ assumptions a market participant would use to value the asset or liability, including consideration of illiquidity in the referenced market.

Recurring Fair Value Measurements

The following tables present certain information regarding assets and liabilities measured at fair value on a recurring basis and the changes in fair value for those specific financial instruments for which fair value has been elected.



	December 31, 2016
	Fair Value Measurements
(Dollars in millions)	Level 1		Level 2		Level 3		Netting Adjustments ¹			Assets/Liabilities at Fair Value
Assets
Trading assets and derivative instruments:
U.S. Treasury securities		$539		$—		$—		$—			$539
Federal agency securities	—		480		—		—			480
U.S. states and political subdivisions	—		134		—		—			134
MBS - agency	—		567		—		—			567
CLO securities	—		1		—		—			1
Corporate and other debt securities	—		656		—		—			656
CP	—		140		—		—			140
Equity securities	49		—		—		—			49
Derivative instruments	293		4,193		28		(3,530		)	984
Trading loans	—		2,517		—		—			2,517
Total trading assets and derivative instruments	881		8,688		28		(3,530		)	6,067

Securities AFS:
U.S. Treasury securities	5,405		—		—		—			5,405
Federal agency securities	—		313		—		—			313
U.S. states and political subdivisions	—		275		4		—			279
MBS - agency	—		23,662		—		—			23,662
MBS - non-agency residential	—		—		74		—			74
MBS - non-agency commercial	—		252		—		—			252
ABS	—		—		10		—			10
Corporate and other debt securities	—		30		5		—			35
Other equity securities ²	102		—		540		—			642
Total securities AFS	5,507		24,532		633		—			30,672

LHFS	—		3,528		12		—			3,540
LHFI	—		—		222		—			222
MSRs	—		—		1,572		—			1,572

Liabilities
Trading liabilities and derivative instruments:
U.S. Treasury securities	697		—		—		—			697
MBS - agency	—		1		—		—			1
Corporate and other debt securities	—		255		—		—			255
Derivative instruments	149		4,731		22		(4,504		)	398
Total trading liabilities and derivative instruments	846		4,987		22		(4,504		)	1,351

Brokered time deposits	—		78		—		—			78
Long-term debt	—		963		—		—			963

¹Amounts represent offsetting cash collateral received from, and paid to, the same derivative counterparties, and the impact of netting derivative assets and derivative liabilities when a legally enforceable master netting agreement or similar agreement exists.

² Includes $102 million of mutual fund investments, $132 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, and $6 million of other.



	December 31, 2015
	Fair Value Measurements
(Dollars in millions)	Level 1		Level 2		Level 3		Netting Adjustments ¹			Assets/Liabilities at Fair Value
Assets
Trading assets and derivative instruments:
U.S. Treasury securities		$538		$—		$—		$—			$538
Federal agency securities	—		588		—		—			588
U.S. states and political subdivisions	—		30		—		—			30
MBS - agency	—		553		—		—			553
CLO securities	—		2		—		—			2
Corporate and other debt securities	—		379		89		—			468
CP	—		67		—		—			67
Equity securities	66		—		—		—			66
Derivative instruments	262		4,182		21		(3,313		)	1,152
Trading loans	—		2,655		—		—			2,655
Total trading assets and derivative instruments	866		8,456		110		(3,313		)	6,119

Securities AFS:
U.S. Treasury securities	3,449		—		—		—			3,449
Federal agency securities	—		411		—		—			411
U.S. states and political subdivisions	—		159		5		—			164
MBS - agency	—		23,124		—		—			23,124
MBS - non-agency residential	—		—		94		—			94
ABS	—		—		12		—			12
Corporate and other debt securities	—		33		5		—			38
Other equity securities ²	93		—		440		—			533
Total securities AFS	3,542		23,727		556		—			27,825

Residential LHFS	—		1,489		5		—			1,494
LHFI	—		—		257		—			257
MSRs	—		—		1,307		—			1,307

Liabilities
Trading liabilities and derivative instruments:
U.S. Treasury securities	503		—		—		—			503
MBS - agency	—		37		—		—			37
Corporate and other debt securities	—		259		—		—			259
Derivative instruments	161		4,261		6		(3,964		)	464
Total trading liabilities and derivative instruments	664		4,557		6		(3,964		)	1,263

Long-term debt	—		973		—		—			973
Other liabilities ³	—		—		23		—			23

¹ Amounts represent offsetting cash collateral received from, and paid to, the same derivative counterparties, and the impact of netting derivative assets and derivative liabilities when a legally enforceable master netting agreement or similar agreement exists.

² Includes $93 million of mutual fund investments, $32 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, and $6 million of other.

³ Includes contingent consideration obligations related to acquisitions.

The following tables present the difference between fair value and the aggregate UPB for which the FVO has been elected for certain trading loans, LHFS, LHFI, brokered time deposits, and long-term debt instruments.



(Dollars in millions)	Fair Value at December 31, 2016		Aggregate UPB at December 31, 2016		Fair Value Over/(Under) Unpaid Principal
Assets:
Trading loans		$2,517		$2,488		$29
LHFS:
Accruing	3,540		3,516		24
LHFI:
Accruing	219		225		(6		)
Nonaccrual	3		4		(1		)
Liabilities:
Brokered time deposits	78		80		(2		)
Long-term debt	963		924		39

(Dollars in millions)	Fair Value at December 31, 2015		Aggregate UPB at December 31, 2015		Fair Value Over/(Under) Unpaid Principal
Assets:
Trading loans		$2,655		$2,605		$50
LHFS:
Accruing	1,494		1,453		41
LHFI:
Accruing	254		259		(5		)
Nonaccrual	3		5		(2		)
Liabilities:
Long-term debt	973		907		66

The following tables present the change in fair value during the years ended December 31, 2016, 2015, and 2014 of financial instruments for which the FVO has been elected, as well as for MSRs. The tables do not reflect the change in fair value attributable to related economic hedges that the Company uses to mitigate market-related risks associated with the financial instruments. Generally, changes in the fair value of economic hedges are recognized in trading income, mortgage production related income, mortgage servicing related income, or other noninterest income as appropriate, and are designed to partially offset the change in fair value of the financial instruments referenced in the tables below. The Company’s economic hedging activities are deployed at both the instrument and portfolio level.



	Fair Value Gain/(Loss) for the Year Ended December 31, 2016 for Items Measured at Fair Value Pursuant to Election of the FVO
(Dollars in millions)	Trading Income		Mortgage Production Related Income ¹		Mortgage Servicing Related Income			Other Noninterest Income		Total Changes in Fair Values Included in Earnings ²
Assets:
Trading loans		$15		$—		$—			$—		$15
LHFS	—		75		—			—		75
MSRs	—		3		(245		)	—		(242		)
Liabilities:
Brokered time deposits	4		—		—			—		4
Long-term debt	27		—		—			—		27

¹Income related to LHFS does not include income from IRLCs. For the year ended December 31, 2016, income related to MSRs includes income recognized upon the sale of loans reported at LOCOM.

²Changes in fair value for the year ended December 31, 2016 exclude accrued interest for the period then ended. Interest income or interest expense on trading loans, LHFS, brokered time deposits, and long-term debt that have been elected to be measured at fair value are recognized in interest income or interest expense in the Consolidated Statements of Income.



	Fair Value (Loss)/Gain for the Year Ended December 31, 2015 for Items Measured at Fair Value Pursuant to Election of the FVO
(Dollars in millions)	Trading Income			Mortgage Production Related Income ¹		Mortgage Servicing Related Income			Other Noninterest Income		Total Changes in Fair Values Included in Earnings ²
Assets:
Trading loans		($1	)		$—		$—			$—		($1	)
LHFS	—			44		—			—		44
LHFI	—			—		—			5		5
MSRs	—			2		(242		)	—		(240		)
Liabilities:
Long-term debt	41			—		—			—		41

¹Income related to LHFS does not include income from IRLCs. For the year ended December 31, 2015, income related to MSRs includes income recognized upon the sale of loans reported at LOCOM.

²Changes in fair value for the year ended December 31, 2015 exclude accrued interest for the period then ended. Interest income or interest expense on trading loans, LHFS, LHFI, and long-term debt that have been elected to be measured at fair value are recognized in interest income or interest expense in the Consolidated Statements of Income.



	Fair Value Gain/(Loss) for the Year Ended December 31, 2014 for Items Measured at Fair Value Pursuant to Election of the FVO
(Dollars in millions)	Trading Income		Mortgage Production Related Income ¹		Mortgage Servicing Related Income			Total Changes in Fair Values Included in Earnings ²
Assets:
Trading loans		$11		$—		$—			$11
LHFS	—		3		—			3
LHFI	—		11		—			11
MSRs	—		3		(401		)	(398		)
Liabilities:
Brokered time deposits	6		—		—			6
Long-term debt	17		—		—			17

¹Income related to LHFS does not include income from IRLCs. For the year ended December 31, 2014, income related to MSRs includes income recognized upon the sale of loans reported at LOCOM.

²Changes in fair value for the year ended December 31, 2014 exclude accrued interest for the period then ended. Interest income or interest expense on trading loans, LHFS, LHFI, brokered time deposits, and long-term debt that have been elected to be measured at fair value are recognized in interest income or interest expense in the Consolidated Statements of Income.

The following is a discussion of the valuation techniques and inputs used in estimating fair value for assets and liabilities measured at fair value on a recurring basis and classified as level 1, 2, and/or 3.

Trading Assets and Derivative Instruments and Securities Available for Sale

Unless otherwise indicated, trading assets are priced by the trading desk and securities AFS are valued by an independent third party pricing service.

Federal Agency Securities

The Company includes in this classification securities issued by federal agencies and GSEs. Agency securities consist of debt obligations issued by HUD, FHLB, and other agencies or collateralized by loans that are guaranteed by the SBA and are, therefore, backed by the full faith and credit of the U.S. government. For SBA instruments, the Company estimates fair value based on pricing from observable trading activity for similar securities or from a third party pricing service. Accordingly, the Company classified these instruments as level 2.

U.S. States and Political Subdivisions

The Company’s investments in U.S. states and political subdivisions (collectively “municipals”) include obligations of county and municipal authorities and agency bonds, which are general obligations of the municipality or are supported by a specified revenue source. Holdings were geographically dispersed, with no significant concentrations in any one state or municipality. Additionally, all AFS municipal obligations classified as level 2 are highly rated or are otherwise collateralized by securities backed by the full faith and credit of the federal government.

Level 3 AFS municipal securities at December 31, 2016 and 2015 includes an immaterial amount of bonds that are redeemable with the issuer at par and cannot be traded in the market. As such, no significant observable market data for these instruments is available; therefore, these securities are priced at par.

MBS – Agency

Agency MBS includes pass-through securities and collateralized mortgage obligations issued by GSEs and U.S. government agencies, such as Fannie Mae, Freddie Mac, and Ginnie Mae. Each security contains a guarantee by the issuing GSE or agency. For agency MBS, the Company estimates fair value based on pricing from observable trading activity for similar securities or from a third party pricing service; accordingly, the Company has classified these instruments as level 2.

MBS – Non-agency

Non-agency residential MBS includes purchased interests in third party securitizations, as well as retained interests in Company-sponsored securitizations of 2006 and 2007 vintage residential mortgages (including both prime jumbo fixed rate collateral and floating rate collateral). At the time of purchase or origination, these securities had high investment grade ratings; however, through the credit crisis, they experienced deterioration in credit quality leading to downgrades to non-investment grade levels. The Company obtains pricing for these securities from an independent pricing service. The Company evaluates third party pricing to determine the reasonableness of the information relative to changes in market data, such as any recent trades, information received from market participants and analysts, and/or changes in the underlying collateral performance. The Company continued to classify non-agency residential MBS as level 3, as the Company believes that available third party pricing relies on significant unobservable assumptions, as evidenced by a persistently wide bid-ask price range and variability in pricing from the pricing services, particularly for the vintage and exposures held by the Company.

Non-agency commercial MBS at December 31, 2016 consists of purchased interests in newly issued third party securitizations. These interests have high investment grade ratings, and the Company obtains pricing for these securities from an independent pricing service. The Company has classified these non-agency commercial MBS as level 2, as the Company believes that the independent pricing service relies on observable data in active markets.

CLO Securities

CLO preference share exposure is estimated at fair value based on pricing from observable trading activity for similar securities. Accordingly, the Company has classified these instruments as level 2.

Asset-Backed Securities

ABS classified as securities AFS includes purchased interests in third party securitizations collateralized by home equity loans and are valued based on third party pricing with significant unobservable assumptions; as such, they are classified as level 3.

Corporate and Other Debt Securities

Corporate debt securities are comprised predominantly of senior and subordinate debt obligations of domestic corporations and are classified as level 2. Other debt securities classified as trading in level 3 at December 31, 2015 included bonds that were not actively traded in the market and for which valuation judgments were highly subjective due to limited observable market data. At December 31, 2015, the fair value of these level 3 bonds were estimated using market comparable bond index yields. These bonds were sold during the first quarter of 2016.

Other debt securities classified as AFS in level 3 at December 31, 2016 and 2015 include bonds that are redeemable with the issuer at par and cannot be traded in the market. As such, observable market data for these instruments is not available.

Commercial Paper

The Company acquires CP that is generally short-term in nature (maturity of less than 30 days) and highly rated. The Company estimates the fair value of this CP based on observable pricing from executed trades of similar instruments; as such, CP is classified as level 2.

Equity Securities

Equity securities classified as securities AFS include primarily FHLB of Atlanta stock and Federal Reserve Bank of Atlanta stock, which are redeemable with the issuer at cost and cannot be traded in the market. As such, observable market data for these instruments is not available and they are classified as level 3. The Company accounts for the stock based on industry guidance that requires these investments be carried at cost and evaluated for impairment based on the ultimate recovery of cost.

The Company estimates the fair value of its mutual fund investments based on quoted prices for similar instruments observed in active markets; as such, these investments are classified as level 1.

Derivative Instruments

The Company holds derivative instruments for both trading and risk management purposes. Level 1 derivative instruments generally include exchange-traded futures or option contracts for which pricing is readily available. The Company’s level 2 instruments are predominantly OTC swaps, options, and forwards, measured using observable market assumptions for interest rates, foreign exchange, equity, and credit. Because fair values for OTC contracts are not readily available, the Company estimates fair values using internal, but standard, valuation models. The selection of valuation models is driven by the type of contract: for option-based products, the Company uses an appropriate option pricing model such as Black-Scholes. For forward-based products, the Company’s valuation methodology is generally a discounted cash flow approach.

The Company's derivative instruments classified as level 2 are primarily transacted in the institutional dealer market and priced with observable market assumptions at a mid-market valuation point, with appropriate valuation adjustments for liquidity and credit risk. To this end, the Company has evaluated liquidity premiums required by market participants, as well as the credit risk of its counterparties and its own credit. See Note 17, “Derivative Financial Instruments,” for additional information on the Company's derivative instruments.

The Company's derivative instruments classified as level 3 include IRLCs that satisfy the criteria to be treated as derivative financial instruments. The fair value of IRLCs on residential and commercial LHFS, while based on interest rates observable in the market, is highly dependent on the ultimate closing of the loans. These “pull-through” rates are based on the Company’s historical data and reflect the Company’s best estimate of the likelihood that a commitment will result in a closed loan. As pull-through rates increase, the fair value of IRLCs also increases. Servicing value is included in the fair value of IRLCs, and the fair value of servicing is determined by projecting cash flows, which are then discounted to estimate an expected fair value. The fair value of servicing is impacted by a variety of factors, including prepayment assumptions, discount rates, delinquency rates, contractually specified servicing fees, servicing costs, and underlying portfolio characteristics. Because these inputs are not transparent in market trades, IRLCs are considered to be level 3 assets. During the years ended December 31, 2016 and 2015, the Company transferred $211 million and $161 million, respectively, of net IRLCs out of level 3 as the associated loans were closed.

Trading Loans

The Company engages in certain businesses whereby electing to measure loans at fair value for financial reporting aligns with the underlying business purpose. Specifically, loans included within this classification include trading loans that are: (i) made or acquired in connection with the Company’s TRS business, (ii) part of the loan sales and trading business within the Company’s Wholesale Banking segment, and (iii) backed by the SBA. See Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," and Note 17, “Derivative Financial Instruments,” for further discussion of this business. All of these loans are classified as level 2 due to the nature of market data that the Company uses to estimate fair value.

The loans made in connection with the Company’s TRS business are short-term, senior demand loans supported by a pledge agreement granting first priority security interest to the Bank in all the assets held by the borrower, a VIE with assets comprised primarily of corporate loans. While these loans do not trade in the market, the Company believes that the par amount of the loans approximates fair value and no unobservable assumptions are used by the Company to value these loans. At December 31, 2016 and 2015, the Company had $2.1 billion and $2.2 billion, respectively, of these short-term loans outstanding, measured at fair value.

The loans from the Company’s sales and trading business are commercial and corporate leveraged loans that are either traded in the market or for which similar loans trade. The Company elected to measure these loans at fair value since they are actively traded. For each of the years ended December 31, 2016, 2015, and 2014, the Company recognized an immaterial amount of gains/(losses) in the Consolidated Statements of Income due to changes in fair value attributable to instrument-specific credit risk. The Company is able to obtain fair value estimates for substantially all of these loans through a third party valuation service that is broadly used by market participants. While most of the loans are traded in the market, the Company does not believe that trading activity qualifies the loans as level 1 instruments, as the volume and level of trading activity is subject to variability and the loans are not exchange-traded. At both December 31, 2016 and 2015, $356 million of loans related to the Company’s trading business were held in inventory.

SBA loans are similar to SBA securities discussed herein under “Federal agency securities,” except for their legal form. In both cases, the Company trades instruments that are fully guaranteed by the U.S. government as to contractual principal and interest and there is sufficient observable trading activity upon which to base the estimate of fair value. As these SBA loans are fully guaranteed, the changes in fair value are attributable to factors other than instrument-specific credit risk.

Loans Held for Sale and Loans Held for Investment

Residential LHFS

The Company values certain newly-originated residential mortgage LHFS at fair value based upon defined product criteria. The Company chooses to fair value these residential mortgage LHFS to eliminate the complexities and inherent difficulties of achieving hedge accounting and to better align reported results with the underlying economic changes in value of the loans and related hedge instruments. Any origination fees are recognized within mortgage production related income in the Consolidated Statements of Income when earned at the time of closing. The servicing value is included in the fair value of the loan and is initially recognized at the time the Company enters into IRLCs with borrowers. The Company employs derivative instruments to economically hedge changes in interest rates and the related impact on servicing value in the fair value of the loan. The mark-to-market adjustments related to LHFS and the associated economic hedges are captured in mortgage production related income.

LHFS classified as level 2 are primarily agency loans which trade in active secondary markets and are priced using current market pricing for similar securities, adjusted for servicing, interest rate risk, and credit risk. Non-agency residential mortgages are also included in level 2 LHFS. Transfers of certain residential mortgage LHFS into level 3 during the years ended December 31, 2016 and 2015 were largely due to borrower defaults or the identification of other loan defects impacting the marketability of the loans.

For residential loans that the Company has elected to measure at fair value, the Company recognized an immaterial amount of gains/(losses) in the Consolidated Statements of Income due to changes in fair value attributable to borrower-specific credit risk for each of the years ended December 31, 2016, 2015, and 2014. In addition to borrower-specific credit risk, there are other more significant variables that drive changes in the fair values of the loans, including interest rates and general market conditions.

Commercial LHFS

The Company values certain commercial LHFS at fair value based upon observable current market prices for similar loans. These loans are generally transferred to agencies within 90 days of origination. The Company has commitments from agencies to purchase these loans at December 31, 2016; therefore, they are classified as Level 2. For commercial loans that the Company has elected to measure at fair value, there were no gains/(losses) recognized in the Consolidated Statements of Income due to changes in fair value attributable to borrower-specific credit risk for the years ended December 31, 2016, 2015, and 2014.

LHFI

LHFI classified as level 3 includes predominantly mortgage loans that are not marketable, largely due to the identification of loan defects. The Company chooses to measure these mortgage LHFI at fair value to better align reported results with the underlying economic changes in value of the loans and any related hedging instruments. The Company values these loans using a discounted cash flow approach based on assumptions that are generally not observable in current markets, such as prepayment speeds, default rates, loss severity rates, and discount rates. Level 3 LHFI also includes mortgage loans that are valued using collateral based pricing. Changes in the applicable housing price index since the time of the loan origination are considered and applied to the loan's collateral value. An additional discount representing the return that a buyer would require is also considered in the overall fair value.

Mortgage Servicing Rights

The Company records residential MSR assets at fair value using a discounted cash flow approach. The fair values of residential MSRs are impacted by a variety of factors, including prepayment assumptions, spreads, delinquency rates, contractually specified servicing fees, servicing costs, and underlying portfolio characteristics. The underlying assumptions and estimated values are corroborated by values received from independent third parties based on their review of the servicing portfolio, and comparisons to market transactions. Because these inputs are not transparent in market trades, MSRs are classified as level 3 assets. For additional information see Note 9, "Goodwill and Other Intangible Assets."

Liabilities

Trading Liabilities and Derivative Instruments

Trading liabilities are comprised primarily of derivative contracts, including IRLCs that satisfy the criteria to be treated as derivative financial instruments, as well as various contracts (primarily U.S. Treasury securities, corporate and other debt securities) that the Company uses in certain of its trading businesses. The Company's valuation methodologies for these derivative contracts and securities are consistent with those discussed within the corresponding sections herein under “Trading Assets and Derivative Instruments and Securities Available for Sale.”

During the second quarter of 2009, in connection with its sale of Visa Class B shares, the Company entered into a derivative contract whereby the ultimate cash payments received or paid, if any, under the contract are based on the ultimate resolution of the Litigation involving Visa. The fair value of the derivative is estimated based on the Company’s expectations regarding the ultimate resolution of that Litigation. The significant unobservable inputs used in the fair value measurement of the derivative involve a high degree of judgment and subjectivity; accordingly, the derivative liability is classified as level 3. See Note 16, "Guarantees," for a discussion of the valuation assumptions.

Brokered Time Deposits

The Company has elected to measure certain CDs that contain embedded derivatives at fair value. This fair value election better aligns the economics of the CDs with the Company’s risk management strategies. The Company evaluated, on an instrument by instrument basis, whether a new issuance would be measured at fair value.

On January 1, 2016, the Company partially adopted ASU 2016-01, which requires changes in credit spreads for financial liabilities measured at fair value pursuant to a fair value option to be recognized in OCI. The impact to OCI is determined from the change in credit spreads above LIBOR swap spreads. For the year ended December 31, 2016, the impact on AOCI due to changes in credit spreads was immaterial. For additional information on the Company's partial adoption of ASU 2016-01, see Note 1, "Significant Accounting Policies."

The Company has classified CDs measured at fair value as level 2 instruments due to the Company's ability to reasonably measure all significant inputs based on observable market variables. The Company employs a discounted cash flow approach based on observable market interest rates for the term of the CD and an estimate of the Bank's credit risk. For any embedded derivative features, the Company uses the same valuation methodologies as if the derivative were a standalone derivative, as discussed herein under "Derivative instruments."

Long-term Debt

The Company has elected to measure at fair value certain fixed rate issuances of public debt that are valued by obtaining price indications from a third party pricing service and utilizing broker quotes to corroborate the reasonableness of those marks. Additionally, information from market data of recent observable trades and indications from buy side investors, if available, are taken into consideration as additional support for the value. Due to the availability of this information, the Company determined that the appropriate classification for these debt issuances is level 2. The fair value election of certain fixed rate debt issuances was made to align the accounting for the debt with the accounting for offsetting derivative positions, without having to apply complex hedge accounting.

The Company utilizes derivative financial instruments to convert interest rates on its debt from fixed to floating rates. On January 1, 2016, the Company partially adopted ASU 2016-01, which requires changes in credit spreads for certain financial instruments elected to be measured at fair value to be recognized in OCI. The impact to OCI for public debt measured at fair value is determined based on the change in credit spreads above LIBOR swap spreads. Upon adoption, the Company recognized a $5 million one-time, cumulative credit risk adjustment in AOCI to recognize the change in credit spreads that occurred prior to January 1, 2016. For the year ended December 31, 2016, the impact on AOCI from changes in credit spreads resulted in a loss of $2 million, net of tax. Prior to January 1, 2016, changes in the Company’s credit spreads for public debt measured at fair value impacted earnings. The estimated earnings impact from changes in credit spreads above U.S. Treasury rates resulted in an immaterial amount of losses for the year ended December 31, 2015 and $19 million of losses for the year ended December 31, 2014. For additional information on the Company's partial adoption of ASU 2016-01, see Note 1, "Significant Accounting Policies."

Other Liabilities

At December 31, 2015 the Company’s other liabilities measured at fair value on a recurring basis included a contingent consideration obligation related to a prior business combination. Contingent consideration was adjusted to fair value until settled. As the assumptions used to measure fair value were based on internal metrics that were not observable in the market, the contingent consideration liability was classified as level 3. During the first quarter of 2016, the Company's contingent consideration obligation under the liability was settled and paid in full.

The valuation technique and range, including weighted average, of the unobservable inputs associated with the Company's level 3 assets and liabilities are as follows:



	Level 3 Significant Unobservable Input Assumptions
(Dollars in millions)	Fair value December 31, 2016		Valuation Technique	Unobservable Input ¹	Range (weighted average)
Assets
Trading assets and derivative instruments:
Derivative instruments, net ²		$6	Internal model	Pull through rate	40-100% (81%)
Derivative instruments, net ²		$6	Internal model	MSR value	22-170 bps (106 bps)
Securities AFS:
U.S. states and political subdivisions	4		Cost	N/A
MBS - non-agency residential	74		Third party pricing	N/A
ABS	10		Third party pricing	N/A
Corporate and other debt securities	5		Cost	N/A
Other equity securities	540		Cost	N/A
Residential LHFS	12		Monte Carlo/Discounted cash flow	Option adjusted spread	104-125 bps (124 bps)
				Conditional prepayment rate	2-28 CPR (7 CPR)
				Conditional default rate	0-3 CDR (0.4 CDR)
LHFI	219		Monte Carlo/Discounted cash flow	Option adjusted spread	62-784 bps (184 bps)
				Conditional prepayment rate	3-36 CPR (13 CPR)
				Conditional default rate	0-5 CDR (2.1 CDR)
	3		Collateral based pricing	Appraised value	NM ³
MSRs	1,572		Monte Carlo/Discounted cash flow	Conditional prepayment rate	1-25 CPR (9 CPR)
MSRs	1,572		Monte Carlo/Discounted cash flow	Option adjusted spread	0-122% (8%)

¹For certain assets and liabilities where the Company utilizes third party pricing, the unobservable inputs and their ranges are not reasonably available, and therefore, have been noted as not applicable ("N/A").

²Amount represents the net of IRLC assets and liabilities and includes the derivative liability associated with the Company's sale of Visa shares. Refer to the "Trading Liabilities and Derivative Instruments" section herein for a discussion of valuation assumptions related to the Visa derivative liability.

³Not meaningful.



	Level 3 Significant Unobservable Input Assumptions
(Dollars in millions)	Fair value December 31, 2015		Valuation Technique	Unobservable Input ¹	Range (weighted average)
Assets
Trading assets and derivative instruments:
Corporate and other debt securities		$89	Market comparables	Yield adjustment	126-447 bps (287 bps)
Derivative instruments, net ²	15		Internal model	Pull through rate	24-100% (79%)
Derivative instruments, net ²	15		Internal model	MSR value	29-210 bps (103 bps)
Securities AFS:
U.S. states and political subdivisions	5		Cost	N/A
MBS - non-agency residential	94		Third party pricing	N/A
ABS	12		Third party pricing	N/A
Corporate and other debt securities	5		Cost	N/A
Other equity securities	440		Cost	N/A
Residential LHFS	5		Monte Carlo/Discounted cash flow	Option adjusted spread	104-197 bps (125 bps)
				Conditional prepayment rate	2-17 CPR (8 CPR)
				Conditional default rate	0-2 CDR (0.5 CDR)
LHFI	251		Monte Carlo/Discounted cash flow	Option adjusted spread	62-784 bps (193 bps)
				Conditional prepayment rate	5-36 CPR (14 CPR)
				Conditional default rate	0-5 CDR (1.7 CDR)
	6		Collateral based pricing	Appraised value	NM ⁴
MSRs	1,307		Monte Carlo/Discounted cash flow	Conditional prepayment rate	2-21 CPR (10 CPR)
MSRs	1,307		Monte Carlo/Discounted cash flow	Option adjusted spread	(5)-110% (8%)
Liabilities
Other liabilities ³	23		Internal model	Loan production volume	150% (150%)

¹For certain assets and liabilities where the Company utilizes third party pricing, the unobservable inputs and their ranges are not reasonably available, and therefore, have been noted as not applicable ("N/A").

²Amount represents the net of IRLC assets and liabilities and includes the derivative liability associated with the Company's sale of Visa shares. Refer to the "Trading Liabilities and Derivative Instruments" section herein for a discussion of valuation assumptions related to the Visa derivative liability.

³Input assumptions relate to the Company's contingent consideration obligations related to acquisitions. See Note 16, "Guarantees," for additional information.

⁴Not meaningful.

The following tables present a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (other than servicing rights which are disclosed in Note 9, “Goodwill and Other Intangible Assets”). Transfers into and out of the fair value hierarchy levels are assumed to occur at the end of the period in which the transfer occurred. None of the transfers into or out of level 3 have been the result of using alternative valuation approaches to estimate fair values. There were no transfers between level 1 and 2 during the years ended December 31, 2016 and 2015.



	Fair Value Measurements Using Significant Unobservable Inputs
(Dollars in millions)	Beginning Balance January 1, 2016		Included in Earnings				OCI			Purchases		Sales			Settlements			Transfers to/from Other Balance Sheet Line Items			Transfers into Level 3		Transfers out of Level 3			Fair Value December 31, 2016		Included in Earnings (held at December 31, 2016 ¹)
Assets
Trading assets:
Corporate and other debt securities		$89		($1	)	²		$—			$—		($88	)		$—			$—			$—		$—			$—		$—
Derivative instruments, net	15		198			³	—			2		—			2			(211		)	—		—			6		7			³
Total trading assets	104		197				—			2		(88		)	2			(211		)	—		—			6		7
Securities AFS:
U.S. states and political subdivisions	5		—				—			—		—			(1		)	—			—		—			4		—
MBS - non-agency residential	94		—				1		⁴	—		—			(21		)	—			—		—			74		—
ABS	12		—				1		⁴	—		—			(3		)	—			—		—			10		—
Corporate and other debt securities	5		—				—			—		—			—			—			—		—			5		—
Other equity securities	440		—				—			308		—			(208		)	—			—		—			540		—
Total securities AFS	556		—				2		⁴	308		—			(233		)	—			—		—			633		—

Residential LHFS	5		(1		)	⁵	—			—		(35		)	—			(5		)	52		(4		)	12		(1		)	⁵
LHFI	257		(2		)	⁵	—			—		—			(44		)	1			10		—			222		(2		)	⁵
Liabilities
Other liabilities	23		—				—			—		—			(23		)	—			—		—			—		—

¹ Change in unrealized gains/(losses) included in earnings during the period related to financial assets still held at December 31, 2016.

² Amounts included in earnings are recognized in trading income.

³ Includes issuances, fair value changes, and expirations. Amount related to IRLCs is recognized in mortgage production related income and amount related to Visa derivative liability is recognized in other noninterest expense.

⁴ Amounts recognized in OCI are included in change in net unrealized (losses)/gains on securities AFS, net of tax.

⁵ Amounts are generally included in mortgage production related income; however, the mark on certain fair value loans is included in other noninterest income.



	Fair Value Measurements Using Significant Unobservable Inputs
(Dollars in millions)	Beginning Balance January 1, 2015		Included in Earnings				OCI				Purchases		Sales			Settlements			Transfers to/from Other Balance Sheet Line Items			Transfers into Level 3		Transfers out of Level 3		Fair Value December 31, 2015		Included in Earnings (held at December 31, 2015 ¹)
Assets
Trading assets:
Corporate and other debt securities		$—		($13	)	²		$—				$123		($21	)		$—			$—			$—		$—		$89		($13	)	²
Derivative instruments, net	20		153			³	—				—		—			3			(161		)	—		—		15		20			³
Total trading assets	20		140				—				123		(21		)	3			(161		)	—		—		104		7
Securities AFS:
U.S. states and political subdivisions	12		—				—				—		—			(7		)	—			—		—		5		—
MBS - non-agency residential	123		(1		)	⁶	1			⁴	—		—			(29		)	—			—		—		94		(1		)	⁶
ABS	21		—				—				—		—			(9		)	—			—		—		12		—
Corporate and other debt securities	5		—				—				5		—			(5		)	—			—		—		5		—
Other equity securities	785		—				(2		)	⁴	104		—			(447		)	—			—		—		440		—
Total securities AFS	946		(1		)	⁶	(1		)	⁴	109		—			(497		)	—			—		—		556		(1		)	⁶

Residential LHFS	1		—				—				—		(20		)	(1		)	(1		)	26		—		5		—
LHFI	272		6			⁵	—				—		—			(41		)	(1		)	21		—		257		4			⁵
Liabilities
Other liabilities	27		6			⁷	—				—		—			(10		)	—			—		—		23		6			⁷

¹ Change in unrealized (losses)/gains included in earnings during the period related to financial assets/liabilities still held at December 31, 2015.

² Amounts included in earnings are recognized in trading income.

³ Includes issuances, fair value changes, and expirations. Amount related to IRLCs is recognized in mortgage production related income and amount related to Visa derivative liability is recognized in other noninterest expense.

⁴ Amounts recognized in OCI are included in change in net unrealized (losses)/gains on securities AFS, net of tax.

⁵ Amounts are generally included in mortgage production related income; however, the mark on certain fair value loans is included in trading income.

⁶ Amount included in earnings is recognized in net securities gains/(losses).

⁷Amounts included in earnings are recognized in other noninterest expense.

Non-recurring Fair Value Measurements

The following tables present losses recognized on assets still held at period end, and measured at fair value on a non-recurring basis, for the year ended December 31, 2016 and the year ended December 31, 2015. Adjustments to fair value generally result from the application of LOCOM or through write-downs of individual assets. The tables do not reflect changes in fair value attributable to economic hedges the Company may have used to mitigate interest rate risk associated with LHFS.



			Fair Value Measurements						Losses for the Year Ended December 31, 2016
(Dollars in millions)	December 31, 2016		Level 1		Level 2		Level 3		Losses for the Year Ended December 31, 2016
LHFI		$75		$—		$—		$75		$—
OREO	17		—		—		17		(2		)
Other assets	112		—		58		54		(36		)

			Fair Value Measurements						Losses for the Year Ended December 31, 2015
(Dollars in millions)	December 31, 2015		Level 1		Level 2		Level 3		Losses for the Year Ended December 31, 2015
LHFS		$202		$—		$—		$202		($6	)
LHFI	48		—		—		48		—
OREO	19		—		—		19		(4		)
Other assets	36		—		29		7		(6		)

Discussed below are the valuation techniques and inputs used in estimating fair values for assets measured at fair value on a non-recurring basis and classified as level 2 and/or 3.

Loans Held for Sale

At December 31, 2015, LHFS consisted of commercial loans that were valued using significant unobservable assumptions from comparably rated loans. As such, these loans are classified as level 3. The decline in LHFS during the year ended December 31, 2016 was due to the sale of $185 million of these loans in the second quarter of 2016 and the sale of the remaining $17 million in the third quarter of 2016.

Loans Held for Investment

At December 31, 2016 and 2015, LHFI consisted primarily of consumer and residential real estate loans discharged in Chapter 7 bankruptcy that had not been reaffirmed by the borrower, as well as nonperforming CRE loans for which specific reserves had been recognized. Cash proceeds from the sale of the underlying collateral is the expected source of repayment for a majority of these loans. Accordingly, the fair value of these loans is derived from the estimated fair value of the underlying collateral, incorporating market data if available. There were no gains/(losses) recognized during the year ended December 31, 2016 or during the year ended December 31, 2015, as the charge-offs related to these loans are a component of the ALLL. Due to the lack of market data for similar assets, all of these loans are classified as level 3.

OREO

OREO is measured at the lower of cost, or fair value less costs to sell. OREO classified as level 3 consists primarily of residential homes, commercial properties, and vacant lots and land for which initial valuations are based on property-specific appraisals, broker pricing opinions, or other limited, highly subjective market information. Updated value estimates are received regularly for level 3 OREO.

Other Assets

Other assets consists of cost and equity method investments, other repossessed assets, assets under operating leases where the Company is the lessor, branch properties, and land held for sale.

Investments in cost and equity method investments are valued based on the expected remaining cash flows to be received from these assets discounted at a market rate that is commensurate with the expected risk, considering relevant Company-specific valuation multiples, where applicable. Based on the valuation methodology and associated unobservable inputs, these investments are classified as level 3. During the year ended December 31, 2016, the Company recognized impairment charges of $8 million on its equity investments. There were no impairment charges recognized on equity investments during the year ended December 31, 2015.

Other repossessed assets comprises repossessed personal property that is measured at fair value less cost to sell. These assets are classified as level 3 as their fair value is determined based on a variety of subjective, unobservable factors. There were no losses recognized in earnings by the Company on other repossessed assets during the year ended December 31, 2016 or during the year ended December 31, 2015, as the impairment charges on repossessed personal property were a component of the ALLL.

The Company monitors the fair value of assets under operating leases where the Company is the lessor and recognizes impairment on the leased asset to the extent the carrying value is not recoverable and is greater than its fair value. Fair value is determined using collateral specific pricing digests, external appraisals, broker opinions, recent sales data from industry equipment dealers, and the discounted cash flows derived from the underlying lease agreement. As market data for similar assets and lease arrangements is available and used in the valuation, these assets are considered level 2. During the years ended December 31, 2016 and 2015, the Company recognized impairment charges of $12 million and $6 million attributable to changes in the fair value of various personal property under operating leases.

The Company recognized impairment charges of $12 million on branch properties during the year ended December 31, 2016. These branches are classified as level 3, as their fair values were based on market comparables and broker opinions.

Land held for sale is recorded at the lesser of carrying value or fair value less cost to sell, and is considered level 3 as its fair value is determined based on market comparables and broker opinions. The Company recognized impairment charges of $4 million on land held for sale during the year ended December 31, 2016. Impairment charges recognized on land held for sale was immaterial during the year ended December 31, 2015.

Fair Value of Financial Instruments

The carrying amounts and fair values of the Company’s financial instruments are as follows:



	December 31, 2016				Fair Value Measurements
(Dollars in millions)	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents		$6,423		$6,423		$6,423		$—		$—	(a)
Trading assets and derivative instruments	6,067		6,067		881		5,158		28		(b)
Securities AFS	30,672		30,672		5,507		24,532		633		(b)
LHFS	4,169		4,178		—		4,161		17		(c)
LHFI, net	141,589		140,516		—		282		140,234		(d)
Financial liabilities:
Deposits	160,398		160,280		—		160,280		—		(e)
Short-term borrowings	4,764		4,764		—		4,764		—		(f)
Long-term debt	11,748		11,779		—		11,051		728		(f)
Trading liabilities and derivative instruments	1,351		1,351		846		483		22		(b)



	December 31, 2015				Fair Value Measurements
(Dollars in millions)	Carrying Amount		Fair Value		Level 1		Level 2		Level 3
Financial assets:
Cash and cash equivalents		$5,599		$5,599		$5,599		$—		$—	(a)
Trading assets and derivative instruments	6,119		6,119		866		5,143		110		(b)
Securities AFS	27,825		27,825		3,542		23,727		556		(b)
LHFS	1,838		1,842		—		1,803		39		(c)
LHFI, net	134,690		131,178		—		397		130,781		(d)
Financial liabilities:
Deposits	149,830		149,889		—		149,889		—		(e)
Short-term borrowings	4,627		4,627		—		4,627		—		(f)
Long-term debt	8,462		8,374		—		7,772		602		(f)
Trading liabilities and derivative instruments	1,263		1,263		664		593		6		(b)

The following methods and assumptions were used by the Company in estimating the fair value of financial instruments:


(a)	Cash and cash equivalents are valued at their carrying amounts, which are reasonable estimates of fair value due to the relatively short period to maturity of the instruments.


(b)	Trading assets and derivative instruments, securities AFS, and trading liabilities and derivative instruments that are classified as level 1 are valued based on quoted market prices. For those instruments classified as level 2 or 3, refer to the respective valuation discussions within this footnote.

(c)

LHFS are generally valued based on observable current market prices or, if quoted market prices are not available, quoted market prices of similar instruments. Refer to the LHFS section within this footnote for further discussion. When valuation assumptions are not readily observable in the market, instruments are valued based on the best available data to approximate fair value. This data may be internally developed and considers risk premiums that a market participant would require under then-current market conditions.

(d)

LHFI fair values are based on a hypothetical exit price, which does not represent the estimated intrinsic value of the loan if held for investment. The assumptions used are expected to approximate those that a market participant purchasing the loans would use to value the loans, including a market risk premium and liquidity discount. Estimating the fair value of the loan portfolio when loan sales and trading markets are illiquid or nonexistent requires significant judgment.

Generally, the Company measures fair value for LHFI based on estimated future discounted cash flows using current origination rates for loans with similar terms and credit quality, which derived an estimated value of 101% on the loan portfolio’s net carrying value at both December 31, 2016 and 2015. The value derived from origination rates likely does not represent an exit price; therefore, an incremental market risk and liquidity discount was applied when estimating the fair value of these loans. The discounted value is a function of a market participant’s required yield in the current environment and is not a reflection of the expected cumulative losses on the loans.

(e)

Deposit liabilities with no defined maturity such as DDAs, NOW/money market accounts, and savings accounts have a fair value equal to the amount payable on demand at the reporting date (i.e., their carrying amounts). Fair values for CDs are estimated using a discounted cash flow approach that applies current interest rates to a schedule of aggregated expected maturities. The assumptions used in the discounted cash flow analysis are expected to approximate those that market participants would use in valuing deposits. The value of long-term relationships with depositors is not taken into account in estimating fair values. Refer to the respective valuation section within this footnote for valuation information related to brokered time deposits that the Company measures at fair value as well as those that are carried at amortized cost.

(f)

Fair values for short-term borrowings and certain long-term debt are based on quoted market prices for similar instruments or estimated discounted cash flows utilizing the Company’s current incremental borrowing rate for similar types of instruments. Refer to the respective valuation section within this footnote for valuation information related to long-term debt that the Company measures at fair value. For level 3 debt, the terms are unique in nature or there are no similar instruments that can be used to value the instrument without using significant unobservable assumptions. In these situations, the Company reviews current borrowing rates along with the collateral levels that secure the debt in determining an appropriate fair value adjustment.

Unfunded loan commitments and letters of credit are not included in the table above. At December 31, 2016 and 2015, the Company had $67.2 billion and $66.2 billion, respectively, of unfunded commercial loan commitments and letters of credit. A reasonable estimate of the fair value of these instruments is the carrying value of deferred fees plus the related unfunded commitments reserve, which was a combined $71 million and $66 million at December 31, 2016 and 2015, respectively. No active trading market exists for these instruments, and the estimated fair value does not include value associated with the borrower relationship. The Company does not estimate the fair values of consumer unfunded lending commitments which can generally be canceled by providing notice to the borrower.

Contingencies

NOTE 19 – CONTINGENCIES

Litigation and Regulatory Matters

In the ordinary course of business, the Company and its subsidiaries are parties to numerous civil claims and lawsuits and subject to regulatory examinations, investigations, and requests for information. Some of these matters involve claims for substantial amounts. The Company’s experience has shown that the damages alleged by plaintiffs or claimants are often overstated, based on unsubstantiated legal theories, unsupported by facts, and/or bear no relation to the ultimate award that a court might grant. Additionally, the outcome of litigation and regulatory matters and the timing of ultimate resolution are inherently difficult to predict. These factors make it difficult for the Company to provide a meaningful estimate of the range of reasonably possible outcomes of claims in the aggregate or by individual claim. However, on a case-by-case basis, reserves are established for those legal claims in which it is probable that a loss will be incurred and the amount of such loss can be reasonably estimated. The Company's financial statements at December 31, 2016 reflect the Company's current best estimate of probable losses associated with these matters, including costs to comply with various settlement agreements, where applicable. The actual costs of resolving these claims may be substantially higher or lower than the amounts reserved.

For a limited number of legal matters in which the Company is involved, the Company is able to estimate a range of reasonably possible losses in excess of related reserves, if any. Management currently estimates these losses to range from $0 to approximately $190 million. This estimated range of reasonably possible losses represents the estimated possible losses over the life of such legal matters, which may span a currently indeterminable number of years, and is based on information available at December 31, 2016. The matters underlying the estimated range will change from time to time, and actual results may vary significantly from this estimate. Those matters for which an estimate is not possible are not included within this estimated range; therefore, this estimated range does not represent the Company’s maximum loss exposure. Based on current knowledge, it is the opinion of management that liabilities arising from legal claims in excess of the amounts currently reserved, if any, will not have a material impact on the Company’s financial condition, results of operations, or cash flows. However, in light of the significant uncertainties involved in these matters and the large or indeterminate damages sought in some of these matters, an adverse outcome in one or more of these matters could be material to the Company’s financial condition, results of operations, or cash flows for any given reporting period.

The following is a description of certain litigation and regulatory matters:

Card Association Antitrust Litigation

The Company is a defendant, along with Visa and MasterCard, as well as several other banks, in several antitrust lawsuits challenging their practices. For a discussion regarding the Company’s involvement in this litigation matter, see Note 16, “Guarantees.”

Lehman Brothers Holdings, Inc. Litigation

Beginning in October 2008, STRH, along with other underwriters and individuals, were named as defendants in several individual and putative class action complaints filed in the U.S. District Court for the Southern District of New York and state and federal courts in Arkansas, California, Texas, and Washington. Plaintiffs alleged violations of Sections 11 and 12 of the Securities Act of 1933 and/or state law for allegedly false and misleading disclosures in connection with various debt and preferred stock offerings of Lehman Brothers Holdings, Inc. ("Lehman Brothers") and sought unspecified damages. All cases were transferred for coordination to the multi-district litigation captioned In re Lehman Brothers Equity/Debt Securities Litigation pending in the U.S. District Court for the Southern District of New York. Defendants filed a motion to dismiss all claims asserted in the class action. On July 27, 2011, the District Court granted in part and denied in part the motion to dismiss the claims against STRH and the other underwriter defendants in the class action. A settlement with the class plaintiffs was approved by the Court and the class settlement approval process was completed. A number of individual lawsuits and smaller putative class actions remained following the class settlement. STRH settled two such individual actions. The other individual lawsuits were dismissed. In two of such dismissed individual actions, the plaintiffs were unable to appeal the dismissals of their claims until their claims against a third party were resolved. In one of these individual actions, the plaintiffs filed a notice of appeal to the Second Circuit Court of Appeals, but that appeal was denied on July 8, 2016. The plaintiff filed a petition to appeal the decision to the U.S. Supreme Court, and on January 13, 2017, the U.S. Supreme Court agreed to hear the appeal. In the other individual action, no appeal has been filed.

Bickerstaff v. SunTrust Bank

This case was filed in the Fulton County State Court on July 12, 2010, and an amended complaint was filed on August 9, 2010. Plaintiff asserts that all overdraft fees charged to his account which related to debit card and ATM transactions are actually interest charges and therefore subject to the usury laws of Georgia. Plaintiff has brought claims for violations of civil and criminal usury laws, conversion, and money had and received, and purports to bring the action on behalf of all Georgia citizens who incurred such overdraft fees within the four years before the complaint was filed where the overdraft fee resulted in an interest rate being charged in excess of the usury rate. The Bank filed a motion to compel arbitration and on March 16, 2012, the Court entered an order holding that the Bank's arbitration provision is enforceable but that the named plaintiff in the case had opted out of that provision pursuant to its terms. The Court explicitly stated that it was not ruling at that time on the question of whether the named plaintiff could have opted out for the putative class members. The Bank filed an appeal of this decision, but this appeal was dismissed based on a finding that the appeal was prematurely granted. On April 8, 2013, the plaintiff filed a motion for class certification and that motion was denied on February 19, 2014. Plaintiff appealed the denial of class certification and on September 8, 2015, the Georgia Supreme Court agreed to hear the appeal. On January 4, 2016, the Georgia Supreme Court heard oral argument on the appeal. On July 8, 2016, the Georgia Supreme Court reversed the Court of Appeals of Georgia and remanded the case for further proceedings.

ERISA Class Actions

Company Stock Class Action

Beginning in July 2008, the Company and certain officers, directors, and employees of the Company were named in a class action alleging that they breached their fiduciary duties under ERISA by offering the Company's common stock as an investment option in the SunTrust Banks, Inc. 401(k) Plan (the “Plan”). The plaintiffs sought to represent all current and former Plan participants who held the Company stock in their Plan accounts from May 15, 2007 to March 30, 2011 and seek to recover alleged losses these participants supposedly incurred as a result of their investment in Company stock.

This case was originally filed in the U.S. District Court for the Southern District of Florida but was transferred to the U.S. District Court for the Northern District of Georgia, Atlanta Division, (the “District Court”) in November 2008. On October 26, 2009, an amended complaint was filed. On December 9, 2009, defendants filed a motion to dismiss the amended complaint. On October 25, 2010, the District Court granted in part and denied in part defendants' motion to dismiss the amended complaint.

On April 14, 2011, the U.S. Court of Appeals for the Eleventh Circuit (“the Circuit Court”) granted defendants and plaintiffs permission to pursue interlocutory review in separate appeals. The Circuit Court subsequently stayed these appeals pending decision of a separate appeal involving The Home Depot in which substantially similar issues are presented. On May 8, 2012, the Circuit Court decided that appeal in favor of The Home Depot. On March 5, 2013, the Circuit Court issued an order remanding the case to the District Court for further proceedings in light of its decision in The Home Depot case. On September 26, 2013, the District Court granted the defendants' motion to dismiss plaintiffs' claims. Plaintiffs filed an appeal of this decision in the Circuit Court. Subsequent to the filing of this appeal, the U.S. Supreme Court decided Fifth Third Bancorp v. Dudenhoeffer, which held that employee stock ownership plan fiduciaries receive no presumption of prudence with respect to employer stock plans. The Circuit Court remanded the case back to the District Court for further proceedings in light of Dudenhoeffer. On June 18, 2015, the Court entered an order granting in part and denying in part the Company’s motion to dismiss. The discovery process has begun.

On August 17, 2016, the District Court entered an order that among other things granted certain of the plaintiffs' motion for class certification. According to the Order, the class is defined as "All persons, other than Defendants and members of their immediate families, who were participants in or beneficiaries of the SunTrust Banks, Inc. 401(k) Savings Plan (the "Plan") at any time between May 15, 2007 and March 30, 2011, inclusive (the "Class Period") and whose accounts included investments in SunTrust common stock ("SunTrust Stock") during that time period and who sustained a loss to their account as a result of the investment in SunTrust Stock."

On August 1, 2016, certain non-fiduciary defendants filed a motion for summary judgment as it relates to them, which was granted by the District Court on October 5, 2016.

Mutual Funds Class Actions

On March 11, 2011, the Company and certain officers, directors, and employees of the Company were named in a putative class action alleging that they breached their fiduciary duties under ERISA by offering certain STI Classic Mutual Funds as investment options in the Plan. The plaintiffs purport to represent all current and former Plan participants who held the STI Classic Mutual Funds in their Plan accounts from April 2002 through December 2010 and seek to recover alleged losses these Plan participants supposedly incurred as a result of their investment in the STI Classic Mutual Funds. This action is pending in the U.S. District Court for the Northern District of Georgia, Atlanta Division (the “District Court”). On June 6, 2011, plaintiffs filed an amended complaint, and, on June 20, 2011, defendants filed a motion to dismiss the amended complaint. On March 12, 2012, the Court granted in part and denied in part the motion to dismiss. The Company filed a subsequent motion to dismiss the remainder of the case on the ground that the Court lacked subject matter jurisdiction over the remaining claims. On October 30, 2012, the Court dismissed all claims in this action. Immediately thereafter, plaintiffs' counsel initiated a substantially similar lawsuit against the Company naming two new plaintiffs and also filed an appeal of the dismissal with the U.S. Court of Appeals for the Eleventh Circuit. The Company filed a motion to dismiss in the new action and this motion was granted. On February 26, 2014, the U.S. Court of Appeals for the Eleventh Circuit upheld the District Court's dismissal. On March 18, 2014, the plaintiffs' counsel filed a motion for reconsideration with the Eleventh Circuit. On August 26, 2014, plaintiffs in the original action filed a Motion for Consolidation of Appeals requesting that the Court consider this appeal jointly with the appeal in the second action. This motion was granted on October 9, 2014 and plaintiffs filed their consolidated appeal on December 16, 2014.

On June 27, 2014, the Company and certain current and former officers, directors, and employees of the Company were named in another putative class action alleging breach of fiduciary duties associated with the inclusion of STI Classic Mutual Funds as investment options in the Plan. This case, Brown, et al. v. SunTrust Banks, Inc., et al., was filed in the U.S. District Court for the District of Columbia. On September 3, 2014, the U.S. District Court for the District of Columbia issued an order transferring the case to the U.S. District Court for the Northern District of Georgia. On November 12, 2014, the Court granted plaintiffs’ motion to stay this case until the U.S. Supreme Court issued a decision in Tibble v. Edison International. On May 18, 2015, the U.S. Supreme Court decided Tibble and held that plan fiduciaries have a duty, separate and apart from investment selection, to monitor and remove imprudent investments.

After Tibble, the cases pending on appeal were remanded to the District Court. On March 25, 2016, a consolidated amended complaint was filed, consolidating all of these pending actions into one case. The Company filed an answer to the consolidated amended complaint on June 6, 2016 and discovery is ongoing.

Intellectual Ventures II v. SunTrust Banks, Inc. and SunTrust Bank

This action was filed in the U.S. District Court for the Northern District of Georgia on July 24, 2013. Plaintiff alleges that SunTrust violates one or more of several patents held by plaintiff in connection with SunTrust’s provision of online banking services and other systems and services. Plaintiff seeks damages for alleged patent infringement of an unspecified amount, as well as attorney’s fees and expenses. The matter was stayed on October 7, 2014 pending inter partes review of a number of the claims asserted against SunTrust.

Consent Order with the Federal Reserve

On April 13, 2011, SunTrust, SunTrust Bank, and STM entered into a Consent Order with the FRB in which SunTrust, SunTrust Bank, and STM agreed to strengthen oversight of, and improve risk management, internal audit, and compliance programs concerning the residential mortgage loan servicing, loss mitigation, and foreclosure activities of STM.

On July 25, 2014, the FRB imposed a $160 million civil money penalty as a result of the FRB’s review of the Company’s residential mortgage loan servicing and foreclosure processing practices that preceded the Consent Order. The Company believes that it has fully satisfied this penalty by having provided consumer relief and certain cash payments as contemplated by the settlement with the U.S. and the States Attorneys' General regarding certain mortgage servicing claims, discussed below at “United States Mortgage Servicing Settlement.” SunTrust continues its engagement with the FRB to demonstrate compliance with its commitments under the Consent Order.

United States Mortgage Servicing Settlement

In the second quarter of 2014, STM and the U.S., through the DOJ, HUD, and Attorneys General for several states, reached a final settlement agreement related to the National Mortgage Servicing Settlement. The settlement agreement became effective on September 30, 2014 when the court entered the Consent Judgment. Pursuant to the settlements, STM made $50 million in cash payments and committed to provide $500 million of consumer relief by the fourth quarter of 2017 and to implement certain mortgage servicing standards. While subject to confirmation by the independent Office of Mortgage Settlement Oversight (“OMSO”) appointed to review and certify compliance with the provisions of the settlement, the Company believes it has fulfilled its consumer relief commitments. STM also implemented all of the prescribed servicing standards within the required timeframes. Compliance with the servicing standards continues to be monitored, tested, and reported quarterly by an internal review group and semi-annually by the OMSO. As a result, the Company does not expect to incur additional costs in satisfying its consumer relief obligations or implementation of the servicing standards associated with the settlement.

DOJ Investigation of GSE Loan Origination Practices

In January 2014, STM received notice from the DOJ of an investigation regarding the origination and underwriting of single family residential mortgage loans sold by STM to Fannie Mae and Freddie Mac. The DOJ and STM have not yet engaged in any material dialogue about how this matter may proceed and no allegations have been raised against STM. STM continues to cooperate with the investigation.

Residential Funding Company, LLC v. SunTrust Mortgage, Inc.

STM has been named as a defendant in a complaint filed December 17, 2013 in the Southern District of New York by Residential Funding Company, LLC ("RFC"), a Chapter 11 debtor-affiliate of GMAC Mortgage, LLC, alleging breaches of representations and warranties made in connection with loan sales and seeking indemnification against losses allegedly suffered by RFC as a result of such alleged breaches. The case was transferred to the United States Bankruptcy Court for the Southern District of New York. The litigation remains active in the Bankruptcy Court and discovery continues.

Thurmond, Christopher, et al. v. SunTrust Banks, Inc., et al.

STM and Twin Rivers Insurance Company ("Twin Rivers") have been named as defendants in a putative class action alleging that the companies entered into illegal “captive reinsurance” arrangements with private mortgage insurers. More specifically, plaintiffs allege that SunTrust’s selection of private mortgage insurers who agree to reinsure with Twin Rivers certain loans referred to them by SunTrust results in illegal “kickbacks” in the form of the insurance premiums paid to Twin Rivers. Plaintiffs contend that this arrangement violates the Real Estate Settlement Procedures Act (“RESPA”) and results in unjust enrichment to the detriment of borrowers. The matter was filed in February 2011 in the U.S. District Court for the Eastern District of Pennsylvania. This case had been stayed by the Court pending the outcome of Edwards v. First American Financial Corporation, a captive reinsurance case that was pending before the U.S. Supreme Court at the time. SunTrust filed a motion to dismiss the Thurmond case which was granted in part and denied in part, allowing limited discovery surrounding the argument that the statute of limitations for certain claims should be equitably tolled. Thurmond had been stayed a second time pending a ruling in a similar case currently before the Third Circuit concerning the application of the statute of limitations. While the stay was lifted, the parties reached an agreement in principle to resolve the matter.

United States Attorney’s Office for the Southern District of New York Foreclosure Expense Investigation

STM has been cooperating with the United States Attorney's Office for the Southern District of New York (the "Southern District") in a broad-based industry investigation regarding claims for foreclosure-related expenses charged by law firms in connection with the foreclosure of loans guaranteed or insured by Fannie Mae, Freddie Mac, or FHA. The investigation relates to a private litigant qui tam lawsuit filed under seal and remains in early stages. The Southern District has not yet advised STM how it will proceed in this matter. The Southern District and STM engaged in dialogue regarding potential resolution of this matter as part of the National Mortgage Servicing Settlement, but were unable to reach agreement.

Felix v. SunTrust Mortgage, Inc.

This putative class action was filed against STM on April 4, 2016. Plaintiff alleges that STM breaches its contract with borrowers when it collects interest on FHA loans at repayment because STM fails to use an approved FHA notice form. Plaintiff also alleges that STM violates the Georgia usury statute by collecting such interest. Plaintiff attempts to bring the breach of contract claim on behalf of all borrowers and the usury claim on behalf of Georgia borrowers. Plaintiff and STM reached a settlement of the action with the class, and the U.S. District Court for the Northern District of Georgia granted preliminary approval of the settlement on September 9, 2016. The settlement terms had an insignificant impact on the Company's financial position. On February 6, 2017, the court approved the settlement, which, barring appeal, will be final in 30 days.

Northern District of Georgia Investigation

On April 28, 2016, the Bank received a subpoena from the United States Attorney’s Office for the Northern District of Georgia in connection with an investigation pertaining to a suspected embezzlement by an employee of a SunTrust business client. The subpoena requests information regarding the Bank’s Anti-Money Laundering and Bank Secrecy Act compliance processes to detect such crimes by employees of business clients. The Company is cooperating with the investigation.

LR Trust v. SunTrust Banks, Inc., et al.

In November 2016, the Company and certain officers and directors were named as defendants in a shareholder derivative action alleging that defendants failed to take action related to activities at issue in the National Mortgage Servicing, HAMP, and FHA Originations settlements, and certain other legal matters or to ensure that the alleged activities in each were remedied and otherwise appropriately addressed. Plaintiff seeks an award in favor of the Company for the amount of damages sustained by the Company, disgorgement of alleged benefits obtained by defendants, and enhancements to corporate governance and internal controls. The Company filed a Motion to Dismiss the matter on February 15, 2017.

SEC Investment Adviser 12b-1 Fees

The SEC Division of Enforcement is investigating whether STIS committed fraud under the Investment Advisers Act ("IAA") of 1940 by purchasing mutual fund shares on behalf of clients that imposed an SEC Rule 12b-1 marketing fee on the investment, if share classes existed which did not impose such a fee, and it has informed the Company that it has made a preliminary determination to recommend that the SEC bring an enforcement action against STIS. STIS is researching the extent to which alternate mutual fund classes existed which did not impose such fees, and other matters. STIS estimates that the amount of such fees was $5 million or less. If there is a finding or admission that STIS violated the antifraud provisions of the IAA, the Company could lose well-known seasoned issuer status and STIS' ability to earn certain investment advisory referral fees may be limited, unless and until the SEC Division of Corporation Finance grants a waiver. STIS is cooperating with the investigation and is in discussions with the SEC.

Business Segment Reporting

NOTE 20 - BUSINESS SEGMENT REPORTING

The Company measures business activity across three segments: Consumer Banking and Private Wealth Management, Wholesale Banking, and Mortgage Banking, with functional activities included in Corporate Other. Business segments are determined based on the products and services provided or the type of client served, and they reflect the manner in which financial information is evaluated by management. The following is a description of the segments and their primary businesses.

The Consumer Banking and Private Wealth Management segment is made up of three primary businesses:

•

Consumer Banking provides services to consumers and branch-managed small business clients through an extensive network of traditional and in-store branches, ATMs, the internet (www.suntrust.com), mobile banking, and by telephone (1-800-SUNTRUST). Financial products and services offered to consumers and small business clients include deposits and payments, loans, brokerage, and various fee-based services. Discount/online and full-service brokerage products are offered to individual clients through STIS. Consumer Banking also serves as an entry point for clients and provides services for other lines of business.

•

Consumer Lending offers an array of lending products to consumers and small business clients via the Company's Consumer Banking and Private Wealth Management businesses, through the internet (www.suntrust.com and www.lightstream.com), as well as through various national offices and partnerships. Products offered include home equity lines, personal credit lines and loans, direct auto, indirect auto, student lending, credit cards, and other lending products.

•

PWM provides a full array of wealth management products and professional services to both individual and institutional clients including loans, deposits, brokerage, professional investment management, and trust services to clients seeking active management of their financial resources. Institutional clients are served by the Institutional Investment Solutions business. Discount/online and full-service brokerage products are offered to individual clients through STIS. PWM also includes GenSpring, which provides family office solutions to ultra-high net worth individuals and their families. Utilizing teams of multi-disciplinary specialists with expertise in investments, tax, accounting, estate planning, and other wealth management disciplines, GenSpring helps families manage and sustain wealth across multiple generations.

The Wholesale Banking segment is made up of three primary lines of business and the Treasury & Payment Solutions product group:

•

CIB delivers comprehensive capital markets solutions, including advisory, capital raising, and financial risk management, with the goal of serving the needs of both public and private companies in the Wholesale Banking segment and PWM business. Investment Banking and Corporate Banking teams within CIB serve clients across the nation, offering a full suite of traditional banking and investment banking products and services to companies with annual revenues typically greater than $150 million. Investment Banking serves select industry segments including consumer and retail, energy, financial services, healthcare, industrials, and technology, media and communications. Corporate Banking serves clients across diversified industry sectors based on size, complexity, and frequency of capital markets issuance. Also managed within CIB is the Equipment Finance Group, which provides lease financing solutions (through SunTrust Equipment Finance & Leasing).

•

Commercial & Business Banking offers an array of traditional banking products, including lending, cash management and investment banking solutions via STRH to commercial clients (generally clients with revenues between $1 million and $150 million), not-for-profit organizations, and governmental entities, as well as auto dealer financing (floor plan inventory financing). Also managed within Commercial & Business Banking is the Premium Assignment Corporation, which provides corporate insurance premium financing solutions.

•

Commercial Real Estate provides a full range of financial solutions for commercial real estate developers, owners, and investors, including construction, mini-perm, and permanent real estate financing, as well as tailored financing and equity investment solutions via STRH. With the acquisition of the assets of Pillar in December of 2016, commercial real estate also provides multi-family agency lending and servicing, as well as loan administration, advisory, and commercial mortgage brokerage services. The institutional real estate team targets relationships with REITs, institutional advisors, private funds, and insurance companies and the regional team focuses on real estate owners and developers through a regional delivery structure. Commercial Real Estate also offers tailored financing and equity investment solutions for community development and affordable housing projects through STCC, with particular expertise in Low Income Housing Tax Credits and New Market Tax Credits.

•

Treasury & Payment Solutions provides all SunTrust Wholesale Banking clients with services required to manage their payments and receipts, combined with the ability to manage and optimize their deposits across all aspects of their business. Treasury & Payment Solutions operates all electronic and paper payment types, including card, wire transfer, ACH, check, and cash. It also provides clients the means to manage their accounts electronically online, both domestically and internationally.

Mortgage Banking offers residential mortgage products nationally through its retail and correspondent channels, the internet (www.suntrust.com), and by telephone (1-800-SUNTRUST). These products are either sold in the secondary market, primarily with servicing rights retained, or held in the Company’s loan portfolio. Mortgage Banking also services loans for other investors, in addition to loans held in the Company’s loan portfolio.

Corporate Other includes management of the Company’s investment securities portfolio, long-term debt, end user derivative instruments, short-term liquidity and funding activities, balance sheet risk management, and most real estate assets. Additionally, Corporate Other includes the Company's functional activities such as marketing, SunTrust online, human resources, finance, Enterprise Risk, legal and compliance, communications, procurement, enterprise information services, corporate real estate, and executive management. The financial results of RidgeWorth, including the gain on sale, are reflected in the Corporate Other segment for the year ended December 31, 2014. Prior to the sale of RidgeWorth in the second quarter of 2014, RidgeWorth's financial performance was reported in the Wholesale Banking segment. See Note 2, "Acquisitions/Dispositions," for additional information related to the sale of RidgeWorth.

Because business segment results are presented based on management accounting practices, the transition to the consolidated results, which are prepared under U.S. GAAP, creates certain differences which are reflected in Reconciling Items. Business segment reporting conventions are described below.

•

Net interest income-FTE – is reconciled from net interest income and is presented on an FTE basis to make income from tax-exempt assets comparable to other taxable products. Segment results reflect matched maturity funds transfer pricing, which ascribes credits or charges based on the economic value or cost created by assets and liabilities of each segment. Differences between these credits and charges are captured as reconciling items. The change in this variance is generally attributable to corporate balance sheet management strategies.


•	Provision/(benefit) for credit losses – represents net charge-offs by segment combined with an allocation to the segments for the provision/(benefit) attributable to each segment's quarterly change in the ALLL and unfunded commitments reserve balances.

•

Provision for income taxes-FTE – is calculated using a blended income tax rate for each segment. This calculation includes the impact of various adjustments, such as the reversal of the FTE gross up on tax-exempt assets, tax adjustments, and credits that are unique to each segment. The difference between the calculated provision for income taxes at the segment level and the consolidated provision for income taxes is reported as reconciling items.

The segment’s financial performance is comprised of direct financial results and allocations for various corporate functions that provide management an enhanced view of the segment’s financial performance. Internal allocations include the following:


•	Operational costs – expenses are charged to segments based on a methodical activity-based costing process, which also allocates residual expenses to the segments. Generally, recoveries of these costs are reported in Corporate Other.


•	Support and overhead costs – expenses not directly attributable to a specific segment are allocated based on various drivers (number of equivalent employees, number of PCs/laptops, net revenue, etc.). Recoveries for these allocations are reported in Corporate Other.


•	Sales and referral credits – segments may compensate another segment for referring or selling certain products. The majority of the revenue resides in the segment where the product is ultimately managed.

The application and development of management reporting methodologies is an active process and undergoes periodic enhancements. The implementation of these enhancements to the internal management reporting methodology may materially affect the results disclosed for each segment, with no impact on consolidated results. If significant changes to management reporting methodologies take place, the impact of these changes is quantified and prior period information is reclassified, when practicable.



	Year Ended December 31, 2016
(Dollars in millions)	Consumer Banking and Private Wealth Management		Wholesale Banking		Mortgage Banking			Corporate Other		Reconciling Items			Consolidated
Balance Sheets:
Average loans		$42,723		$71,605		$26,726			$66		($2	)		$141,118
Average consumer and commercial deposits	95,875		55,293		2,969			124		(72		)	154,189
Average total assets	48,415		85,513		30,697			31,939		2,440			199,004
Average total liabilities	96,466		61,050		3,344			14,148		(72		)	174,936
Average total equity	—		—		—			—		24,068			24,068
Statements of Income:
Net interest income		$2,857		$1,849		$448			$96		($29	)		$5,221
FTE adjustment	—		136		—			2		—			138
Net interest income-FTE ¹	2,857		1,985		448			98		(29		)	5,359
Provision/(benefit) for credit losses ²	185		272		(13		)	—		—			444
Net interest income after provision/(benefit) for credit losses-FTE	2,672		1,713		461			98		(29		)	4,915
Total noninterest income	1,472		1,234		559			136		(18		)	3,383
Total noninterest expense	3,056		1,693		732			5		(18		)	5,468
Income before provision for income taxes-FTE	1,088		1,254		288			229		(29		)	2,830
Provision for income taxes-FTE ³	404		387		105			59		(12		)	943
Net income including income attributable to noncontrolling interest	684		867		183			170		(17		)	1,887
Net income attributable to noncontrolling interest	—		—		—			9		—			9
Net income		$684		$867		$183			$161		($17	)		$1,878

¹Presented on a matched maturity funds transfer price basis for the segments.

²Provision/(benefit) for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision/(benefit) attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.

³Includes regular provision for income taxes and taxable-equivalent income adjustment reversal.



	Year Ended December 31, 2015
(Dollars in millions)	Consumer Banking and Private Wealth Management		Wholesale Banking		Mortgage Banking			Corporate Other		Reconciling Items			Consolidated
Balance Sheets:
Average loans		$40,614		$67,872		$25,024			$60		($12	)		$133,558
Average consumer and commercial deposits	91,104		50,379		2,679			101		(61		)	144,202
Average total assets	46,513		80,915		28,692			29,655		3,117			188,892
Average total liabilities	91,747		56,050		3,048			14,771		(70		)	165,546
Average total equity	—		—		—			—		23,346			23,346
Statements of Income:
Net interest income		$2,728		$1,781		$483			$147		($375	)		$4,764
FTE adjustment	1		138		—			3		—			142
Net interest income-FTE ¹	2,729		1,919		483			150		(375		)	4,906
Provision/(benefit) for credit losses ²	137		137		(110		)	—		1			165
Net interest income after provision/(benefit) for credit losses-FTE	2,592		1,782		593			150		(376		)	4,741
Total noninterest income	1,507		1,180		460			135		(14		)	3,268
Total noninterest expense	2,939		1,551		681			4		(15		)	5,160
Income before provision for income taxes-FTE	1,160		1,411		372			281		(375		)	2,849
Provision for income taxes-FTE ³	431		459		85			82		(151		)	906
Net income including income attributable to noncontrolling interest	729		952		287			199		(224		)	1,943
Net income attributable to noncontrolling interest	—		—		—			9		1			10
Net income		$729		$952		$287			$190		($225	)		$1,933

¹Presented on a matched maturity funds transfer price basis for the segments.

²Provision/(benefit) for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision/(benefit) attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.

³Includes regular provision for income taxes and taxable-equivalent income adjustment reversal.



	Year Ended December 31, 2014
(Dollars in millions)	Consumer Banking and Private Wealth Management		Wholesale Banking		Mortgage Banking			Corporate Other			Reconciling Items			Consolidated
Balance Sheets:
Average loans		$41,702		$62,627		$26,494			$56			($5	)		$130,874
Average consumer and commercial deposits	86,046		43,569		2,333			112			(48		)	132,012
Average total assets	47,430		74,093		30,386			27,125			3,142			182,176
Average total liabilities	86,774		50,294		2,665			20,283			(10		)	160,006
Average total equity	—		—		—			—			22,170			22,170
Statements of Income/(Loss):
Net interest income		$2,628		$1,661		$552			$275			($276	)		$4,840
FTE adjustment	1		139		—			3			(1		)	142
Net interest income-FTE ¹	2,629		1,800		552			278			(277		)	4,982
Provision for credit losses ²	191		71		81			—			(1		)	342
Net interest income after provision for credit losses-FTE	2,438		1,729		471			278			(276		)	4,640
Total noninterest income	1,527		1,063		473			278			(18		)	3,323
Total noninterest expense	2,904		1,473		1,048			134			(16		)	5,543
Income/(loss) before provision/(benefit) for income taxes-FTE	1,061		1,319		(104		)	422			(278		)	2,420
Provision/(benefit) for income taxes-FTE ³	390		423		(52		)	(26		)	(100		)	635
Net income/(loss) including income attributable to noncontrolling interest	671		896		(52		)	448			(178		)	1,785
Net income attributable to noncontrolling interest	—		—		—			11			—			11
Net income/(loss)		$671		$896		($52	)		$437			($178	)		$1,774

¹Presented on a matched maturity funds transfer price basis for the segments.

²Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.

³Includes regular provision/(benefit) for income taxes and taxable-equivalent income adjustment reversal.

Accumulated Other Comprehensive Income

NOTE 21 - ACCUMULATED OTHER COMPREHENSIVE (LOSS)/INCOME

Changes in the components of AOCI, net of tax, are presented in the following table:



(Dollars in millions)	Securities AFS			Derivative Instruments			Brokered Time Deposits			Long-Term Debt			Employee Benefit Plans			Total
Year Ended December 31, 2016
Balance, beginning of period		$135			$87			$—			$—			($682	)		($460	)
Cumulative credit risk adjustment ¹	—			—			—			(5		)	—			(5		)
Net unrealized losses arising during the period	(194		)	(91		)	(1		)	(2		)	—			(288		)
Amounts reclassified to net income	(3		)	(153		)	—			—			88			(68		)
Other comprehensive (loss)/income, net of tax	(197		)	(244		)	(1		)	(2		)	88			(356		)
Balance, end of period		($62	)		($157	)		($1	)		($7	)		($594	)		($821	)

Year Ended December 31, 2015
Balance, beginning of period		$298			$97			$—			$—			($517	)		($122	)
Net unrealized (losses)/gains arising during the period	(150		)	154			—			—			—			4
Amounts reclassified to net income	(13		)	(164		)	—			—			(165		)	(342		)
Other comprehensive loss, net of tax	(163		)	(10		)	—			—			(165		)	(338		)
Balance, end of period		$135			$87			$—			$—			($682	)		($460	)

Year Ended December 31, 2014
Balance, beginning of period		($77	)		$279			$—			$—			($491	)		($289	)
Net unrealized gains arising during the period	366			62			—			—			—			428
Amounts reclassified to net income	9			(244		)	—			—			(26		)	(261		)
Other comprehensive income/(loss), net of tax	375			(182		)	—			—			(26		)	167
Balance, end of period		$298			$97			$—			$—			($517	)		($122	)

¹ Related to the Company's early adoption of the ASU 2016-01 provision related to changes in instrument-specific credit risk. See Note 1, "Significant Accounting Policies," for additional information.

Reclassifications from AOCI, and the related tax effects, are presented in the following table:



(Dollars in millions)	Year Ended December 31									Impacted Line Item in the Consolidated Statements of Income
Details About AOCI Components	2016			2015			2014			Impacted Line Item in the Consolidated Statements of Income
Securities AFS:
Realized (gains)/losses on securities AFS		($4	)		($21	)		$15		Net securities gains/(losses)
Tax effect	1			8			(6		)	Provision for income taxes
	(3		)	(13		)	9
Derivative Instruments:
Realized gains on cash flow hedges	(244		)	(261		)	(387		)	Interest and fees on loans
Tax effect	91			97			143			Provision for income taxes
	(153		)	(164		)	(244		)
Employee Benefit Plans:
Amortization of prior service credit	(6		)	(6		)	(6		)	Employee benefits
Amortization of actuarial loss	25			21			16			Employee benefits
Adjustment to funded status of employee benefit obligation	121			(283		)	(51		)	Other assets/other liabilities
	140			(268		)	(41		)
Tax effect	(52		)	103			15			Provision for income taxes
	88			(165		)	(26		)

Total reclassifications from AOCI to net income		($68	)		($342	)		($261	)

SunTrust Banks, Inc. (Parent Company Only) Financial Information

Condensed Financial Information of Parent Company Only Disclosure [Text Block]

NOTE 22 - PARENT COMPANY FINANCIAL INFORMATION

Statements of Income - Parent Company Only



	Year Ended December 31
(Dollars in millions)	2016			2015			2014
Income
Dividends ¹		$1,300			$1,159			$1,057
Interest from loans to subsidiaries	15			8			7
Trading gains/(losses)	2			(1		)	10
Gain on sale of subsidiary	—			—			105
Other income	12			15			13
Total income	1,329			1,181			1,192
Expense
Interest on short-term borrowings	2			1			7
Interest on long-term debt	140			128			122
Employee compensation and benefits ²	57			69			42
Service fees to subsidiaries	12			6			10
Other expense	24			21			11
Total expense	235			225			192
Income before income tax benefit and equity in undistributed income of subsidiaries	1,094			956			1,000
Income tax benefit	59			61			2
Income before equity in undistributed income of subsidiaries	1,153			1,017			1,002
Equity in undistributed income of subsidiaries	725			916			772
Net income		$1,878			$1,933			$1,774
Preferred dividends		($66	)		($64	)		($42	)
Dividends and undistributed earnings allocated to unvested shares	(1		)	(6		)	(10		)
Net income available to common shareholders		$1,811			$1,863			$1,722

¹Substantially all dividend income is from subsidiaries (primarily the Bank).

² Includes incentive compensation allocations between the Parent Company and subsidiaries.

Balance Sheets - Parent Company Only



	December 31
(Dollars in millions)	2016			2015
Assets
Cash held at SunTrust Bank		$535			$478
Interest-bearing deposits held at SunTrust Bank	1,126			2,115
Interest-bearing deposits held at other banks	23			22
Cash and cash equivalents	1,684			2,615
Trading assets and derivative instruments	—			8
Securities available for sale	147			198
Loans to subsidiaries	2,516			1,627
Investment in capital stock of subsidiaries stated on the basis of the Company’s equity in subsidiaries’ capital accounts:
Banking subsidiaries	23,617			23,324
Nonbanking subsidiaries	1,359			1,291
Goodwill	211			211
Other assets	528			382
Total assets		$30,062			$29,656

Liabilities
Short-term borrowings:
Subsidiaries		$283			$178
Non-affiliated companies	483			582
Long-term debt:
Non-affiliated companies	4,950			4,772
Other liabilities	831			795
Total liabilities	6,547			6,327
Shareholders’ Equity
Preferred stock	1,225			1,225
Common stock	550			550
Additional paid-in capital	9,010			9,094
Retained earnings	16,000			14,686
Treasury stock, at cost, and other ¹	(2,449		)	(1,766		)
Accumulated other comprehensive loss, net of tax	(821		)	(460		)
Total shareholders’ equity	23,515			23,329
Total liabilities and shareholders’ equity		$30,062			$29,656

¹ At December 31, 2016, includes ($2,448) million for treasury stock and ($1) million for compensation element of restricted stock.

At December 31, 2015, includes ($1,764) million for treasury stock and ($2) million for compensation element of restricted stock.

Statements of Cash Flows - Parent Company Only



	Year Ended December 31
(Dollars in millions)	2016			2015			2014
Cash Flows from Operating Activities:
Net income		$1,878			$1,933			$1,774
Adjustments to reconcile net income to net cash provided by operating activities:
Gain on sale of subsidiary	—			—			(105		)
Equity in undistributed income of subsidiaries	(725		)	(916		)	(772		)
Depreciation, amortization, and accretion	3			6			5
Deferred income tax expense/(benefit)	11			(4		)	35
Stock-based compensation	3			11			21
Net securities losses	—			—			2
Net (increase)/decrease in other assets ¹	(129		)	(72		)	207
Net increase/(decrease) in other liabilities ¹	62			(28		)	29
Net cash provided by operating activities	1,103			930			1,196
Cash Flows from Investing Activities:
Proceeds from maturities, calls, and paydowns of securities available for sale	49			66			71
Proceeds from sales of securities available for sale	4			—			21
Purchases of securities available for sale	(4		)	(15		)	(26		)
Proceeds from sales of auction rate securities	—			—			59
Net (increase)/decrease in loans to subsidiaries	(889		)	1,042			(1,518		)
Proceeds from sale of subsidiary	—			—			193
Net capital contributions to subsidiaries	—			—			(32		)
Other, net	(3		)	(2		)	(10		)
Net cash (used in)/provided by investing activities	(843		)	1,091			(1,242		)
Cash Flows from Financing Activities:
Net increase/(decrease) in short-term borrowings	5			(763		)	(686		)
Proceeds from long-term debt	2,005			—			723
Repayment of long-term debt	(1,784		)	(29		)	(5		)
Proceeds from the issuance of preferred stock	—			—			496
Repurchase of common stock	(806		)	(679		)	(458		)
Repurchase of common stock warrants	(24		)	—			—
Common and preferred dividends paid	(564		)	(539		)	(409		)
Taxes paid related to net share settlement of equity awards ¹	(48		)	(36		)	(16		)
Proceeds from the exercise of stock options ¹	25			17			10
Net cash used in financing activities	(1,191		)	(2,029		)	(345		)
Net decrease in cash and cash equivalents	(931		)	(8		)	(391		)
Cash and cash equivalents at beginning of period	2,615			2,623			3,014
Cash and cash equivalents at end of period		$1,684			$2,615			$2,623

Supplemental Disclosures:
Income taxes paid to subsidiaries		($886	)		($499	)		($219	)
Income taxes received by Parent Company	812			481			171
Net income taxes paid by Parent Company		($74	)		($18	)		($48	)
Interest paid		$135			$130			$131

¹ Related to the Company's early adoption of ASU 2016-09, certain prior period amounts have been retrospectively reclassified between operating activities and financing activities. See Note 1, "Significant Accounting Policies," for additional information.

Significant Accounting Policies (Policies)

Accounting Policies Recently Adopted and Pending Accounting Pronouncements

Recently Issued Accounting Pronouncements

The following table summarizes ASUs recently issued by the FASB that could have a material effect on the Company's financial statements:



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
Standards Adopted (or partially adopted) in 2016
ASU 2015-02, Amendments to the Consolidation Analysis	The ASU rescinds the indefinite deferral of previous amendments to ASC Topic 810, Consolidation, for certain entities and amends components of the consolidation analysis under ASC Topic 810, including evaluating limited partnerships and similar legal entities, evaluating fees paid to a decision maker or service provider as a variable interest, the effects of fee arrangements and/or related parties on the primary beneficiary determination and investment fund specific matters. The ASU may be adopted either retrospectively or on a modified retrospective basis.	January 1, 2016	The Company adopted this ASU on a modified retrospective basis beginning January 1, 2016. The adoption of this standard had no impact to the Consolidated Financial Statements.
ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs	The ASU amends ASC Topic 835, Interest, to simplify the presentation of debt issuance costs and to require that debt issuance costs, related to a recognized debt liability, be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the ASU. The new ASU should be applied on a retrospective basis.	January 1, 2016	The Company adopted the ASU beginning January 1, 2016 to present long-term debt net of debt issuance costs in the Consolidated Financial Statements. Debt issuance costs in the comparative prior year period were immaterial for reclassification and were recorded in other assets on the Company's Consolidated Balance Sheets at December 31, 2015.
ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities	The ASU amends ASC Topic 825, Financial Instruments-Overall, and addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The main provisions require investments in equity securities to be measured at fair value through net income, unless they qualify for a practicability exception, and require fair value changes arising from changes in instrument-specific credit risk for financial liabilities that are measured under the fair value option to be recognized in other comprehensive income. With the exception of disclosure requirements that will be adopted prospectively, the ASU must be adopted on a modified retrospective basis.	January 1, 2018 Early adoption is permitted beginning January 1, 2016 or 2017 for the provision related to changes in instrument-specific credit risk for financial liabilities under the FVO.	The Company early adopted the provision related to changes in instrument-specific credit risk beginning January 1, 2016, which resulted in an immaterial, cumulative effect adjustment from retained earnings to AOCI. See Note 21, "Accumulated Other Comprehensive (Loss)/Income" for additional information. The Company is evaluating the impact of the remaining provisions of this ASU on the Consolidated Financial Statements and related disclosures; however, the impact is not expected to be material.



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
ASU 2016-09, Improvements to Employee Share-Based Payment Accounting	The ASU amends ASC Topic 718, Compensation-Stock Compensation, which simplifies several aspects of the accounting for employee share-based payments transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. Adoption methods are specific to the component of the ASU, ranging from a retrospective and modified retrospective basis to a prospective basis.	January 1, 2017 Early adoption is permitted.	The Company early adopted the ASU on April 1, 2016 with an effective date of January 1, 2016, which resulted in a reclassification of $4 million from APIC to provision for income taxes, representing excess tax benefits previously recognized in APIC during the first quarter of 2016. For the second, third, and fourth quarters of 2016, the Company recognized excess tax benefits totaling $11 million in the provision for income taxes. The early adoption favorably impacted basic and diluted EPS by $0.03 and $0.02 per share, respectively, for the year ended December 31, 2016. The effect of the retrospective change in presentation in the Consolidated Statements of Cash Flows related to excess tax benefits for the years ended December 31, 2015 and 2014 (comparative prior year periods) was a reclassification of $20 million and $6 million, respectively, of excess tax benefits from financing activities to operating activities and a reclassification of $36 million and $16 million, respectively, of taxes paid related to net share settlement of equity awards from operating activities to financing activities. The net impact on the Consolidated Statements of Cash Flows was immaterial. The Company had no previously unrecognized excess tax benefits; therefore, there was no impact to the Consolidated Financial Statements as it related to the elimination of the requirement that excess tax benefits be realized before recognition. The Company elected to retain its existing accounting policy election to estimate award forfeitures.
Standards Not Yet Adopted
ASU 2014-09, Revenue from Contracts with Customers ASU 2015-14, Deferral of the Effective Date ASU 2016-08, Principal versus Agent Considerations ASU 2016-10, Identifying Performance Obligations and Licensing ASU 2016-12, Narrow-Scope Improvements and Practical Expedients ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers	These ASUs supersede the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the ASUs is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASUs may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts, with remaining performance obligations as of the effective date.	January 1, 2018 Early adoption is permitted beginning January 1, 2017.	The Company is evaluating the anticipated effects of these ASUs on the Consolidated Financial Statements and related disclosures. The Company has conducted a comprehensive scoping exercise to determine the revenue streams that are in the scope of these updates. Preliminary results indicate that certain noninterest income financial statement line items, including service charges on deposit accounts, card fees, other charges and fees, investment banking income, trust and investment management income, retail investment services, and other noninterest income, contain revenue streams that are in scope of these updates. Preliminary findings indicate that there may be some changes in the presentation of certain revenues and expenses based on the principal versus agent guidance within these updates; the materiality of these changes is still being assessed. The Company plans to adopt the standards beginning January 1, 2018 and expects to use the modified retrospective method of adoption.



Standard	Description	Required Date of Adoption	Effect on the Financial Statements or Other Significant Matters
ASU 2016-02, Leases	The ASU creates ASC Topic 842, Leases, and supersedes Topic 840, Leases. Topic 842 requires lessees to recognize right-of-use assets and associated liabilities that arise from leases, with the exception of short-term leases. The ASU does not make significant changes to lessor accounting; however, there were certain improvements made to align lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. There are several new qualitative and quantitative disclosures required. Upon transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach.	January 1, 2019 Early adoption is permitted.	The adoption of this ASU will result in an increase to the Consolidated Balance Sheets for right-of-use assets and associated lease liabilities for operating leases in which the Company is the lessee. The Company is evaluating the significance and other effects of adoption on the Consolidated Financial Statements and related disclosures.
ASU 2016-07, Simplifying the Transition to the Equity Method of Accounting	The ASU amends ASC Topic 323, Investments-Equity Method and Joint Ventures, to eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investor obtains significant influence over the investee. In addition, if the investor previously held an AFS equity security, the ASU requires that the investor recognize through earnings the unrealized holding gain or loss in AOCI, as of the date it obtains significant influence. The ASU is to be applied on a prospective basis.	January 1, 2017 Early application is permitted.	This ASU will not impact the Consolidated Financial Statements and related disclosures until there is an applicable increase in investment or change in influence resulting in a transition to the equity method.
ASU 2016-13, Measurement of Credit Losses on Financial Instruments	The ASU amends ASC Topic 326, Financial Instruments-Credit Losses, to replace the incurred loss impairment methodology with a current expected credit loss methodology for financial instruments measured at amortized cost and other commitments to extend credit. For this purpose, expected credit losses reflect losses over the remaining contractual life of an asset, considering the effect of voluntary prepayments and considering available information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts. The resulting allowance for credit losses reflects the portion of the amortized cost basis that the entity does not expect to collect. Additional quantitative and qualitative disclosures are required upon adoption. The CECL model does not apply to AFS debt securities; however the ASU requires entities to record an allowance when recognizing credit losses for AFS securities, rather than recording a direct write-down of the carrying amount.	January 1, 2020 Early adoption is permitted beginning January 1, 2019.	The Company is evaluating the impact the ASU will have on the Company's Consolidated Financial Statements and related disclosures.

Employee Benefit Plans Employee Benefits - Policies (Policies)

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

The Company sponsors various compensation and benefit programs to attract and retain talent. Aligned with a pay for performance culture, the Company's plans and programs include short-term incentives, AIP, LTI cash and LTI plans with various forms of stock-based compensation, which are discussed in the following section. All incentive awards are subject to clawback provisions. Compensation expense for long-term incentive plans with cash payouts was $291 million, $245 million, and $203 million for the years ended December 31, 2016, 2015, and 2014, respectively. Compensation expense for short-term incentive plans with cash payouts was $469 million, $448 million, and $462 million for the years ended December 31, 2016, 2015, and 2014, respectively.

Stock-Based Compensation

The Company provides stock-based awards through the 2009 Stock Plan and various other deferred compensation plans under which the Compensation Committee of the Board of Directors has the authority to grant stock options, stock appreciation rights, restricted stock, phantom stock units, and RSUs to key employees of the Company. Award vesting may be conditional based upon individual, business unit, Company, and/or performance relative to peer group metrics. On April 1, 2016, the Company early adopted ASU 2016-09, which provides improvements to employee share-based payment accounting, with an effective date of January 1, 2016. See Note 1, "Significant Accounting Policies," for additional information.

As amended and restated effective January 1, 2014, following approval by the Compensation Committee of the Board, shareholders approved an amendment to the 2009 Stock Plan to remove the sub-limit on shares available for grant that may be issued as restricted stock or RSUs. Accordingly, all 17 million remaining authorized shares previously under the Stock Plan became available for grant as stock options, stock appreciation rights, restricted stock, or RSUs. Prior to the amendment, only a portion of such shares were available to be granted as either restricted stock or RSUs. At December 31, 2016, approximately 17 million shares were available for grant. All stock option grants are exercisable for 10 years after the grant date.

Shares or units of restricted stock may be granted to employees and directors. Generally, grants to employees either cliff vest after three years or vest pro-rata annually over three years. Restricted stock and RSU grants may be subject to one or more criteria, including employment, performance, or other conditions as established by the Compensation Committee at the time of grant. Any shares of restricted stock that are forfeited will again become available for issuance under the Stock Plan. An employee or director has the right to vote the shares of restricted stock after grant until they are forfeited. Compensation cost for restricted stock and RSUs is generally equal to the fair market value of the shares on the grant date of the award and is amortized to compensation expense over the vesting period. Dividends are paid on awarded, unvested restricted stock.

The Company accrues and reinvests dividends in equivalent shares of SunTrust common stock for unvested RSU awards, which are paid out when the underlying RSU award vests. Generally, RSU awards are classified as equity. However, during 2012 there were 574,257 RSUs granted that were classified as a liability. These awards were granted with a fair value of $21.67 per unit on the grant date. RSUs classified as a liability at December 31, 2015 totaled $23 million. These awards were fully vested and paid in cash during February 2016.

Consistent with the Company's 2014 decision to discontinue the issuance of stock options, no stock options were granted during the years ended December 31, 2016, 2015, and 2014.

Acquisitions/Dispositions Acquisitions/Dispositions (Tables)

Schedule of Business Acquisition, Purchase Price Allocation [Table Text Block]

The Company performed a preliminary allocation of the purchase price to the underlying assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition, presented in the following table.



(Dollars in millions)	December 15, 2016
Consideration		$197
Pillar purchase price allocation to:
Cash and cash equivalents		$9
LHFI	38
LHFS	182
Commercial mortgage servicing rights	62
Other intangible assets	14
Other assets	8
Other short-term borrowings	(100		)
Other liabilities	(16		)
Identified net assets acquired at fair value		$197

Goodwill		$—

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

During the years ended December 31, 2016, 2015, and 2014, the Company had the following notable acquisition and disposition:



(Dollars in millions)	Date	Cash (Paid)/Received			Goodwill		Other Intangible Assets			Pre-tax Gain
2016
Acquisition of Pillar	12/15/2016		($197	)		$—		$14	¹		$—
2014
Sale of RidgeWorth	5/30/2014	193			—		—			105

¹ Does not include servicing rights acquired.

Federal Funds Sold and Securities Borrowed or Purchased Under Agreements to Resell (Tables)

Schedule of Resale Agreements [Table Text Block]

Fed funds sold and securities borrowed or purchased under agreements to resell were as follows:



(Dollars in millions)	December 31, 2016		December 31, 2015
Fed funds sold		$58		$38
Securities borrowed	270		277
Securities purchased under agreements to resell	979		962
Total Fed funds sold and securities borrowed or purchased under agreements to resell		$1,307		$1,277

Securities sold under agreements to repurchase remaining contractual maturity [Table Text Block]

Securities sold under agreements to repurchase are accounted for as secured borrowings. The following table presents the Company’s related activity, by collateral type and remaining contractual maturity:



	December 31, 2016								December 31, 2015
(Dollars in millions)	Overnight and Continuous		Up to 30 days		30-90 days		Total		Overnight and Continuous		Up to 30 days		Total
U.S. Treasury securities		$27		$—		$—		$27		$112		$—		$112
Federal agency securities	288		24		—		312		319		—		319
MBS - agency	793		51		—		844		837		23		860
CP	49		—		—		49		49		—		49
Corporate and other debt securities	311		50		40		401		242		72		314
Total securities sold under agreements to repurchase		$1,468		$125		$40		$1,633		$1,559		$95		$1,654

Netting of Financial Instruments - Repurchase Agreements [Table Text Block]

The following table includes the amount of collateral pledged or received related to exposures subject to enforceable MRAs. While these agreements are typically over-collateralized, U.S. GAAP requires disclosure in this table to limit the amount of such collateral to the amount of the related recognized asset or liability for each counterparty.



(Dollars in millions)	Gross Amount		Amount Offset		Net Amount Presented in Consolidated Balance Sheets			Held/Pledged Financial Instruments		Net Amount
December 31, 2016
Financial assets:
Securities borrowed or purchased under agreements to resell		$1,249		$—		$1,249	¹		$1,241		$8
Financial liabilities:
Securities sold under agreements to repurchase	1,633		—		1,633			1,633		—

December 31, 2015
Financial assets:
Securities borrowed or purchased under agreements to resell		$1,239		$—		$1,239	¹		$1,229		$10
Financial liabilities:
Securities sold under agreements to repurchase	1,654		—		1,654			1,654		—

¹Excludes $58 million and $38 million of Fed funds sold, which are not subject to a master netting agreement at December 31, 2016 and 2015, respectively

Trading Assets and Liabilities and Derivatives Trading Assets and Liabilities and Derivatives (Tables)

Trading Securities [Table Text Block]

The fair values of the components of trading assets and liabilities and derivative instruments are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Trading Assets and Derivative Instruments:
U.S. Treasury securities		$539		$538
Federal agency securities	480		588
U.S. states and political subdivisions	134		30
MBS - agency	567		553
CLO securities	1		2
Corporate and other debt securities	656		468
CP	140		67
Equity securities	49		66
Derivative instruments ¹	984		1,152
Trading loans ²	2,517		2,655
Total trading assets and derivative instruments		$6,067		$6,119

Trading Liabilities and Derivative Instruments:
U.S. Treasury securities		$697		$503
MBS - agency	1		37
Corporate and other debt securities	255		259
Derivative instruments ¹	398		464
Total trading liabilities and derivative instruments		$1,351		$1,263

¹Amounts include the impact of offsetting cash collateral received from and paid to the same derivative counterparties, and the impact of netting derivative assets and derivative liabilities when a legally enforceable master netting agreement or similar agreement exists.

² Includes loans related to TRS.

Schedule of Financial Instruments Owned and Pledged as Collateral [Table Text Block]

Pledged trading assets are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Pledged trading assets to secure repurchase agreements ¹		$968		$986
Pledged trading assets to secure certain derivative agreements	471		393
Pledged trading assets to secure other arrangements	40		40

¹ Repurchase agreements secured by collateral totaled $928 million and $950 million at December 31, 2016 and 2015, respectively.

Securities Available for Sale (Tables)

Securities Portfolio Composition



	December 31, 2016
(Dollars in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U.S. Treasury securities		$5,486		$5		$86		$5,405
Federal agency securities	310		5		2		313
U.S. states and political subdivisions	279		5		5		279
MBS - agency	23,642		313		293		23,662
MBS - non-agency residential	71		3		—		74
MBS - non-agency commercial	257		—		5		252
ABS	8		2		—		10
Corporate and other debt securities	34		1		—		35
Other equity securities ¹	642		1		1		642
Total securities AFS		$30,729		$335		$392		$30,672

	December 31, 2015
(Dollars in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
U.S. Treasury securities		$3,460		$3		$14		$3,449
Federal agency securities	402		10		1		411
U.S. states and political subdivisions	156		8		—		164
MBS - agency	22,877		397		150		23,124
MBS - non-agency residential	92		2		—		94
ABS	11		2		1		12
Corporate and other debt securities	37		1		—		38
Other equity securities ¹	533		1		1		533
Total securities AFS		$27,568		$424		$167		$27,825

¹ At December 31, 2016, the fair value of other equity securities was comprised of the following: $132 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, $102 million of mutual fund investments, and $6 million of other.

At December 31, 2015, the fair value of other equity securities was comprised of the following: $32 million of FHLB of Atlanta stock, $402 million of Federal Reserve Bank of Atlanta stock, $93 million of mutual fund investments, and $6 million of other.

Investment Income [Table Text Block]

The following table presents interest and dividends on securities AFS:



	Year Ended December 31
(Dollars in millions)	2016		2015		2014
Taxable interest		$630		$552		$565
Tax-exempt interest	6		6		10
Dividends	15		35		38
Total interest and dividends on securities AFS		$651		$593		$613

Amortized Cost and Fair Value of Investments in Debt Securities by Estimated Average Life



	Distribution of Remaining Maturities
(Dollars in millions)	Due in 1 Year or Less			Due After 1 Year through 5 Years			Due After 5 Years through 10 Years			Due After 10 Years			Total
Amortized Cost:
U.S. Treasury securities		$—			$2,344			$3,142			$—			$5,486
Federal agency securities	114			87			7			102			310
U.S. states and political subdivisions	10			21			83			165			279
MBS - agency	1,889			12,667			8,847			239			23,642
MBS - non-agency residential	—			48			23			—			71
MBS - non-agency commercial	—			12			245			—			257
ABS	7			—			1			—			8
Corporate and other debt securities	15			19			—			—			34
Total debt securities AFS		$2,035			$15,198			$12,348			$506			$30,087
Fair Value:
U.S. Treasury securities		$—			$2,332			$3,073			$—			$5,405
Federal agency securities	114			91			7			101			313
U.S. states and political subdivisions	10			22			86			161			279
MBS - agency	1,989			12,788			8,645			240			23,662
MBS - non-agency residential	—			50			24			—			74
MBS - non-agency commercial	—			12			240			—			252
ABS	8			—			2			—			10
Corporate and other debt securities	16			19			—			—			35
Total debt securities AFS		$2,137			$15,314			$12,077			$502			$30,030
Weighted average yield ¹	3.01		%	2.40		%	2.42		%	3.14		%	2.46		%

¹Weighted average yields are based on amortized cost.

Securities in a Continuous Unrealized Loss Position



	December 31, 2016
	Less than twelve months				Twelve months or longer				Total
(Dollars in millions)	Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses ²
Temporarily impaired securities AFS:
U.S. Treasury securities		$4,380		$86		$—		$—		$4,380		$86
Federal agency securities	96		2		3		—		99		2
U.S. states and political subdivisions	149		5		—		—		149		5
MBS - agency	14,622		285		451		8		15,073		293
MBS - non-agency commercial	184		5		—		—		184		5
ABS	—		—		5		—		5		—
Corporate and other debt securities	12		—		—		—		12		—
Other equity securities	—		—		4		1		4		1
Total temporarily impaired securities AFS	19,443		383		463		9		19,906		392
OTTI securities AFS ¹:
MBS - non-agency residential	16		—		—		—		16		—
ABS	—		—		1		—		1		—
Total OTTI securities AFS	16		—		1		—		17		—
Total impaired securities AFS		$19,459		$383		$464		$9		$19,923		$392



	December 31, 2015
	Less than twelve months				Twelve months or longer				Total
(Dollars in millions)	Fair Value		Unrealized Losses ²		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses ²
Temporarily impaired securities AFS:
U.S. Treasury securities		$2,169		$14		$—		$—		$2,169		$14
Federal agency securities	75		—		34		1		109		1
MBS - agency	11,434		114		958		36		12,392		150
ABS	—		—		7		1		7		1
Other equity securities	3		1		—		—		3		1
Total temporarily impaired securities AFS	13,681		129		999		38		14,680		167
OTTI securities AFS ¹:
ABS	1		—		—		—		1		—
Total OTTI securities AFS	1		—		—		—		1		—
Total impaired securities AFS		$13,682		$129		$999		$38		$14,681		$167

¹OTTI securities AFS are impaired securities for which OTTI credit losses have been previously recognized in earnings.

²Unrealized losses less than $0.5 million are presented as zero within the table.

Measurement of Investment Credit Loss Assumptions Table [Table Text Block]



	2016 ²	2015 ¹	2014 ¹
Default rate	N/A	9%	2%
Prepayment rate	N/A	13%	16%
Loss severity	N/A	56%	46%

Realized Gain (Loss) on Investments [Table Text Block]



	Year Ended December 31
(Dollars in millions)	2016		2015			2014
Gross realized gains		$4		$25			$28
Gross realized losses	—		(3		)	(42		)
OTTI credit losses recognized in earnings	—		(1		)	(1		)
Net securities gains/(losses)		$4		$21			($15	)

Loans Loans (Tables)

Composition of Loan Portfolio



(Dollars in millions)	December 31, 2016		December 31, 2015
Commercial loans:
C&I		$69,213		$67,062
CRE	4,996		6,236
Commercial construction	4,015		1,954
Total commercial loans	78,224		75,252
Residential loans:
Residential mortgages - guaranteed	537		629
Residential mortgages - nonguaranteed ¹	26,137		24,744
Residential home equity products	11,912		13,171
Residential construction	404		384
Total residential loans	38,990		38,928
Consumer loans:
Guaranteed student	6,167		4,922
Other direct	7,771		6,127
Indirect	10,736		10,127
Credit cards	1,410		1,086
Total consumer loans	26,084		22,262
LHFI		$143,298		$136,442
LHFS ²		$4,169		$1,838

¹Includes $222 million and $257 million of LHFI measured at fair value at December 31, 2016 and 2015, respectively.

²Includes $3.5 billion and $1.5 billion of LHFS measured at fair value at December 31, 2016 and 2015, respectively.

LHFI by Credit Quality Indicator

LHFI by credit quality indicator are presented in the following tables:



	Commercial Loans
	C&I				CRE				Commercial Construction
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Risk rating:
Pass		$66,920		$65,379		$4,574		$6,067		$3,914		$1,931
Criticized accruing	1,903		1,375		415		158		84		23
Criticized nonaccruing	390		308		7		11		17		—
Total		$69,213		$67,062		$4,996		$6,236		$4,015		$1,954



	Residential Loans ¹
	Residential Mortgages - Nonguaranteed				Residential Home Equity Products				Residential Construction
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Current FICO score range:
700 and above		$22,194		$20,422		$9,826		$10,772		$292		$313
620 - 699	3,042		3,262		1,540		1,741		96		58
Below 620 ²	901		1,060		546		658		16		13
Total		$26,137		$24,744		$11,912		$13,171		$404		$384



	Consumer Loans ³
	Other Direct				Indirect				Credit Cards
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015
Current FICO score range:
700 and above		$7,008		$5,501		$7,642		$7,015		$974		$759
620 - 699	703		576		2,381		2,481		351		265
Below 620 ²	60		50		713		631		85		62
Total		$7,771		$6,127		$10,736		$10,127		$1,410		$1,086

¹Excludes $537 million and $629 million of guaranteed residential loans at December 31, 2016 and 2015, respectively.

²For substantially all loans with refreshed FICO scores below 620, the borrower’s FICO score at the time of origination exceeded 620 but has since deteriorated as the loan has seasoned.

³Excludes $6.2 billion and $4.9 billion of guaranteed student loans at December 31, 2016 and 2015, respectively.

Payment Status for the LHFI Portfolio

The payment status for the LHFI portfolio is presented in the following tables:



	December 31, 2016
(Dollars in millions)	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing ²		Total
Commercial loans:
C&I		$68,776		$35		$12		$390		$69,213
CRE	4,988		1		—		7		4,996
Commercial construction	3,998		—		—		17		4,015
Total commercial loans	77,762		36		12		414		78,224
Residential loans:
Residential mortgages - guaranteed	155		55		327		—		537
Residential mortgages - nonguaranteed ¹	25,869		84		7		177		26,137
Residential home equity products	11,596		81		—		235		11,912
Residential construction	389		3		—		12		404
Total residential loans	38,009		223		334		424		38,990
Consumer loans:
Guaranteed student	4,637		603		927		—		6,167
Other direct	7,726		35		4		6		7,771
Indirect	10,608		126		1		1		10,736
Credit cards	1,388		12		10		—		1,410
Total consumer loans	24,359		776		942		7		26,084
Total LHFI		$140,130		$1,035		$1,288		$845		$143,298

¹Includes $222 million of loans measured at fair value, the majority of which were accruing current.

²Nonaccruing loans past due 90 days or more totaled $360 million. Nonaccruing loans past due fewer than 90 days include modified nonaccrual loans reported as TDRs, performing second lien loans where the first lien loan is nonperforming, and certain energy-related commercial loans.



	December 31, 2015
(Dollars in millions)	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing ²		Total
Commercial loans:
C&I		$66,670		$61		$23		$308		$67,062
CRE	6,222		3		—		11		6,236
Commercial construction	1,952		—		2		—		1,954
Total commercial loans	74,844		64		25		319		75,252
Residential loans:
Residential mortgages - guaranteed	192		59		378		—		629
Residential mortgages - nonguaranteed ¹	24,449		105		7		183		24,744
Residential home equity products	12,939		87		—		145		13,171
Residential construction	365		3		—		16		384
Total residential loans	37,945		254		385		344		38,928
Consumer loans:
Guaranteed student	3,861		500		561		—		4,922
Other direct	6,094		24		3		6		6,127
Indirect	10,022		102		—		3		10,127
Credit cards	1,070		9		7		—		1,086
Total consumer loans	21,047		635		571		9		22,262
Total LHFI		$133,836		$953		$981		$672		$136,442

¹Includes $257 million of loans measured at fair value, the majority of which were accruing current.

²Nonaccruing loans past due 90 days or more totaled $336 million. Nonaccruing loans past due fewer than 90 days include modified nonaccrual loans reported as TDRs and performing second lien loans where the first lien loan is nonperforming, and certain energy-related commercial loans.

LHFI Considered Impaired



	December 31, 2016								December 31, 2015
(Dollars in millions)	Unpaid Principal Balance			Amortized Cost ¹			Related Allowance		Unpaid Principal Balance		Amortized Cost ¹		Related Allowance
Impaired loans with no related allowance recorded:
Commercial loans:
C&I		$266			$214			$—		$55		$42		$—
CRE	—			—			—		11		9		—
Total commercial loans	266			214			—		66		51		—
Residential loans:
Residential mortgages - nonguaranteed	466			360			—		500		380		—
Residential construction	16			8			—		29		8		—
Total residential loans	482			368			—		529		388		—

Impaired loans with an allowance recorded:
Commercial loans:
C&I	225			151			31		173		167		28
CRE	26			17			2		—		—		—
Total commercial loans	251			168			33		173		167		28
Residential loans:
Residential mortgages - nonguaranteed	1,277			1,248			150		1,381		1,344		178
Residential home equity products	863			795			54		740		670		60
Residential construction	109			107			11		127		125		14
Total residential loans	2,249			2,150			215		2,248		2,139		252
Consumer loans:
Other direct	59		²	59		²	1		11		11		1
Indirect	103			103			5		114		114		5
Credit cards	24			6			1		24		6		1
Total consumer loans	186			168			7		149		131		7
Total impaired loans		$3,434			$3,068			$255		$3,165		$2,876		$287

¹Amortized cost reflects charge-offs that have been recognized plus other amounts that have been applied to adjust the net book balance.

²Includes $41 million of TDRs that were modified prior to 2016 and reclassified as TDRs in the fourth quarter of 2016.

Included in the impaired loan balances above at December 31, 2016 and 2015 were $2.5 billion and $2.6 billion, respectively, of accruing TDRs at amortized cost, of which 97% were current. See Note 1, “Significant Accounting Policies,” for further information regarding the Company’s loan impairment policy.



	Year Ended December 31
	2016				2015				2014
(Dollars in millions)	Average Amortized Cost		Interest Income Recognized¹		Average Amortized Cost		Interest Income Recognized¹		Average Amortized Cost		Interest Income Recognized ¹
Impaired loans with no related allowance recorded:
Commercial loans:
C&I		$169		$3		$58		$2		$84		$1
CRE	—		—		10		—		11		1
Total commercial loans	169		3		68		2		95		2
Residential loans:
Residential mortgages - nonguaranteed	370		16		390		17		437		17
Residential construction	8		—		11		—		12		—
Total residential loans	378		16		401		17		449		17

Impaired loans with an allowance recorded:
Commercial loans:
C&I	170		1		147		5		16		1
CRE	25		1		—		—		5		—
Total commercial loans	195		2		147		5		21		1
Residential loans:
Residential mortgages - nonguaranteed	1,251		64		1,349		65		1,357		78
Residential home equity products	812		29		682		28		644		27
Residential construction	110		6		125		8		144		8
Total residential loans	2,173		99		2,156		101		2,145		113
Consumer loans:
Other direct	10		1		12		—		14		—
Indirect	114		6		125		6		113		5
Credit cards	6		1		7		1		10		1
Total consumer loans	130		8		144		7		137		6
Total impaired loans		$3,045		$128		$2,916		$132		$2,847		$139

¹Of the interest income recognized during the years ended December 31, 2016, 2015, and 2014, cash basis interest income was $4 million, $7 million, and $4 million respectively.

Nonperforming Assets

NPAs are presented in the following table:



(Dollars in millions)	December 31, 2016		December 31, 2015
Nonaccrual/NPLs:
Commercial loans:
C&I		$390		$308
CRE	7		11
Commercial construction	17		—
Residential loans:
Residential mortgages - nonguaranteed	177		183
Residential home equity products	235		145
Residential construction	12		16
Consumer loans:
Other direct	6		6
Indirect	1		3
Total nonaccrual/NPLs ¹	845		672
OREO ²	60		56
Other repossessed assets	14		7
Total NPAs		$919		$735

¹ Nonaccruing restructured loans are included in total nonaccrual/NPLs.

² Does not include foreclosed real estate related to loans insured by the FHA or the VA. Proceeds due from the FHA and the VA are recorded as a receivable in other assets in the Consolidated Balance Sheets until the property is conveyed and the funds are received. The receivable related to proceeds due from the FHA or the VA totaled $50 million and $52 million at December 31, 2016 and 2015, respectively.

TDR Modifications



	2016 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	144		$—		$2		$134		$136
CRE	4	—		—		—		—
Commercial construction	1	—		—		—		—
Residential loans:
Residential mortgages - nonguaranteed	931	3		82		10		95
Residential home equity products	3,448	—		10		243		253
Residential construction	63	—		—		—		—
Consumer loans:
Other direct ³	4,021	—		—		50		50
Indirect	3,141	—		—		37		37
Credit cards	719	—		3		—		3
Total TDRs	12,472		$3		$97		$474		$574

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan may have had other concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2016 was immaterial.

³Includes 3,321 loans with an amortized cost of $41 million that were modified prior to 2016 and reclassified as TDRs in the fourth quarter of 2016.



	2015 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	79		$—		$1		$8		$9
CRE	1	—		—		—		—
Residential loans:
Residential mortgages - nonguaranteed	789	12		129		25		166
Residential home equity products	2,172	—		25		113		138
Residential construction	23	—		6		—		6
Consumer loans:
Other direct	66	—		—		1		1
Indirect	2,578	—		—		52		52
Credit cards	683	—		3		—		3
Total TDRs	6,391		$12		$164		$199		$375

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan may have had other concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2015 was $2 million.



	2014 ¹
(Dollars in millions)	Number of Loans Modified	Principal Forgiveness ²		Rate Modification		Term Extension and/or Other Concessions		Total
Commercial loans:
C&I	78		$—		$1		$37		$38
CRE	6	4		—		3		7
Residential loans:
Residential mortgages - nonguaranteed	1,135	10		127		44		181
Home equity products	1,977	—		7		86		93
Residential construction	11	—		1		—		1
Consumer loans:
Other direct	71	—		—		1		1
Indirect	2,928	—		—		57		57
Credit cards	450	—		2		—		2
Total TDRs	6,656		$14		$138		$228		$380

¹Includes loans modified under the terms of a TDR that were charged-off during the period.

² Restructured loans which had forgiveness of amounts contractually due under the terms of the loan typically have had multiple concessions including rate modifications and/or term extensions. The total amount of charge-offs associated with principal forgiveness during the year ended December 31, 2014 was $14 million.

Troubled Debt Restructurings

The following table presents TDRs that have defaulted during the year ended December 31, 2016 that were first modified within the previous 12 months.



	Year Ended December 31, 2016
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	22		$15
Residential loans:
Residential mortgages	55	11
Residential home equity products	137	10
Consumer loans:
Other direct	20	—
Indirect	117	1
Credit cards	97	—
Total TDRs	448		$37

The following table presents TDRs that have defaulted during the year ended December 31, 2015 that were first modified within the previous 12 months.



	Year Ended December 31, 2015
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	34		$1
Residential loans:
Residential mortgages	120	16
Residential home equity products	138	6
Consumer loans:
Other direct	5	—
Indirect	171	2
Credit cards	84	—
Total TDRs	552		$25

The following table presents TDRs that have defaulted during the year ended December 31, 2014 that were first modified within the previous 12 months.



	Year Ended December 31, 2014
(Dollars in millions)	Number of Loans	Amortized Cost
Commercial loans:
C&I	78		$10
Residential loans:
Residential mortgages	158	19
Home equity products	101	5
Residential construction	6	—
Consumer loans:
Other direct	9	—
Indirect	181	1
Credit cards	145	1
Total TDRs	678		$36

Concentration Risk Disclosure [Text Block]



(Dollars in millions)	December 31, 2016		December 31, 2015
Interest only mortgages with MI or with combined original LTV ≤ 80%¹		$845		$1,563
Interest only mortgages with no MI and with combined original LTV > 80%¹	279		547
Total interest only mortgages ¹	1,124		2,110
Amortizing mortgages with combined original LTV > 80% and/or second liens ²	9,198		8,366
Total mortgages with potential concentration of credit risk		$10,322		$10,476

¹Comprised of first and/or second liens, primarily with an initial 10 year interest only period.

²Comprised of loans with no MI.

Allowance for Credit Losses (Tables)

Activity in the Allowance for Credit Losses

The allowance for credit losses consists of the ALLL and the unfunded commitments reserve. Activity in the allowance for credit losses is summarized in the following table:



	Year Ended December 31
(Dollars in millions)	2016			2015			2014
Balance, beginning of period		$1,815			$1,991			$2,094
Provision for loan losses	440			156			338
Provision for unfunded commitments	4			9			4
Loan charge-offs	(591		)	(470		)	(607		)
Loan recoveries	108			129			162
Balance, end of period		$1,776			$1,815			$1,991

Components:
ALLL		$1,709			$1,752			$1,937
Unfunded commitments reserve ¹	67			63			54
Allowance for credit losses		$1,776			$1,815			$1,991

¹The unfunded commitments reserve is recorded in other liabilities in the Consolidated Balance Sheets.

Activity in the ALLL by Segment

Activity in the ALLL by loan segment is presented in the following tables:



	Year Ended December 31, 2016
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance, beginning of period		$1,047			$534			$171			$1,752
Provision/(benefit) for loan losses	329			(59		)	170			440
Loan charge-offs	(287		)	(136		)	(168		)	(591		)
Loan recoveries	35			30			43			108
Balance, end of period		$1,124			$369			$216			$1,709

	Year Ended December 31, 2015
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance, beginning of period		$986			$777			$174			$1,937
Provision/(benefit) for loan losses	133			(67		)	90			156
Loan charge-offs	(117		)	(218		)	(135		)	(470		)
Loan recoveries	45			42			42			129
Balance, end of period		$1,047			$534			$171			$1,752

Loans Held for Investment portfolio and Related Allowance for Loan and Lease Losses

The Company’s LHFI portfolio and related ALLL is presented in the following tables:



	December 31, 2016
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL
Individually evaluated		$382		$33		$2,518		$215		$168		$7		$3,068		$255
Collectively evaluated	77,842		1,091		36,250		154		25,916		209		140,008		1,454
Total evaluated	78,224		1,124		38,768		369		26,084		216		143,076		1,709
LHFI at fair value	—		—		222		—		—		—		222		—
Total LHFI		$78,224		$1,124		$38,990		$369		$26,084		$216		$143,298		$1,709



	December 31, 2015
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL		Carrying Value		ALLL
Individually evaluated		$218		$28		$2,527		$252		$131		$7		$2,876		$287
Collectively evaluated	75,034		1,019		36,144		282		22,131		164		133,309		1,465
Total evaluated	75,252		1,047		38,671		534		22,262		171		136,185		1,752
LHFI at fair value	—		—		257		—		—		—		257		—
Total LHFI		$75,252		$1,047		$38,928		$534		$22,262		$171		$136,442		$1,752

Premises and Equipment (Tables)

Property, Plant and Equipment [Table Text Block]

Premises and equipment at December 31 consisted of the following:



(Dollars in millions)	Useful Life (in years)	2016		2015
Land	Indefinite		$320		$330
Buildings and improvements	1 - 40	1,028		1,073
Leasehold improvements	1 - 30	645		636
Furniture and equipment	1 - 20	1,492		1,463
Construction in progress		357		249
Total premises and equipment		3,842		3,751
Less: Accumulated depreciation and amortization		2,286		2,249
Premises and equipment, net			$1,556		$1,502

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

The Company has various obligations under capital leases and noncancelable operating leases for premises and equipment. The leases predominantly expire over the next 13 years, with the longest expiring in 2081. Many of these leases provide for periodic adjustment of rentals based on changes in various economic indicators, while others also include a renewal option.

The following table presents future minimum payments under noncancelable operating leases, net of sublease rentals, with initial terms in excess of one year at December 31, 2016.



(Dollars in millions)	Operating Leases
2017		$205
2018	193
2019	179
2020	159
2021	148
Thereafter	727
Total minimum lease payments		$1,611

Goodwill and Other Intangible Assets (Tables)

Schedule of Goodwill [Table Text Block]



(Dollars in millions)	Consumer Banking and Private Wealth Management		Wholesale Banking		Total
Balance, January 1, 2016		$4,262		$2,075		$6,337
Acquisition of Pillar	—		—		—
Balance, December 31, 2016		$4,262		$2,075		$6,337

Schedule of Finite-Lived Intangible Assets by Major Class [Table Text Block]



(Dollars in millions)	MSRs - Fair Value			Other			Total
Balance, January 1, 2016		$1,307			$18			$1,325
Amortization ¹	—			(9		)	(9		)
Servicing rights originated	312			—			312
Servicing rights purchased	200			—			200
Servicing rights acquired in Pillar acquisition	—			62			62
Other intangible assets acquired in Pillar acquisition ²	—			14			14
Changes in fair value:
Due to changes in inputs and assumptions ³	(13		)	—			(13		)
Other changes in fair value ⁴	(232		)	—			(232		)
Servicing rights sold	(2		)	—			(2		)
Balance, December 31, 2016		$1,572			$85			$1,657

Balance, January 1, 2015		$1,206			$13			$1,219
Amortization ¹	—			(8		)	(8		)
Servicing rights originated	238			13			251
Servicing rights purchased	109			—			109
Changes in fair value:
Due to changes in inputs and assumptions ³	(32		)	—			(32		)
Other changes in fair value ⁴	(210		)	—			(210		)
Servicing rights sold	(4		)	—			(4		)
Balance, December 31, 2015		$1,307			$18			$1,325

¹ Does not include expense associated with non-qualified community development investments. See Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," for additional information.

² The majority of these other intangible assets acquired from Pillar relate to indefinite-lived agency licenses. See Note 2, "Acquisitions/Dispositions," for additional information.

³ Primarily reflects changes in option adjusted spreads and prepayment speed assumptions, due to changes in interest rates.

⁴ Represents changes due to the collection of expected cash flows, net of accretion due to the passage of time.

Finite-lived Intangible Assets Amortization Expense [Table Text Block]

The Company's estimated future amortization of intangible assets at December 31, 2016 is presented in the following table:



(Dollars in millions)
2017		$15
2018	12
2019	9
2020	9
2021	7
Thereafter	23
Total ¹		$75

¹ Does not include indefinite-lived intangible assets of $10 million.

Key Characteristics, Inputs, and Economic Assumptions Used to Estimate the Fair Value of the Company's MSRs



(Dollars in millions)	December 31, 2016			December 31, 2015
Fair value of MSRs		$1,572			$1,307
Prepayment rate assumption (annual)	9		%	10		%
Decline in fair value from 10% adverse change		$50			$49
Decline in fair value from 20% adverse change	97			94
Option adjusted spread (annual)	8		%	8		%
Decline in fair value from 10% adverse change		$63			$64
Decline in fair value from 20% adverse change	122			123
Weighted-average life (in years)	7.0			6.6
Weighted-average coupon	4.0		%	4.1		%

Borrowings and Contractual Commitments (Tables)

Schedule of Short-term Debt [Table Text Block]

Other short-term borrowings at December 31 consisted of the following:



	2016				2015
(Dollars in millions)	Balance		Interest Rate		Balance		Interest Rate
Master notes		$483	0.25	%		$582	0.20	%
Dealer collateral	451		0.55		442		0.20
Other	81		2.28		—		—
Total other short-term borrowings		$1,015				$1,024

Certain Transfers of Financial Assets and Variable Interest Entities (Tables)

Portfolio Balances and Delinquency Balances Based on 90 Days or More Past Due and Net Charge-offs Related to Managed Portfolio Loans



	Portfolio Balance				Past Due and Nonaccrual				Net Charge-offs
	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		Year Ended December 31
(Dollars in millions)	December 31, 2016		December 31, 2015		December 31, 2016		December 31, 2015		2016			2015
LHFI portfolio:
Commercial		$78,224		$75,252		$426		$344		$252			$72
Residential	38,990		38,928		758		729		106			176
Consumer	26,084		22,262		949		580		125			93
Total LHFI portfolio	143,298		136,442		2,133		1,653		483			341
Managed securitized loans ¹:
Commercial ²	4,761		—		—		—		—			—
Residential	126,641		116,990		114		126		8		³	12		³
Consumer	512		807		1		1		3			2
Total managed securitized loans	131,914		117,797		115		127		11			14
Managed unsecuritized loans ⁴	2,985		3,973		438		597		—			—
Total managed loans		$278,197		$258,212		$2,686		$2,377		$494			$355

¹ Excludes loans that have completed the foreclosure or short sale process (i.e., involuntary prepayments).

² Comprised of commercial mortgages sold by Pillar through Fannie Mae, Freddie Mac, and Ginnie Mae securitizations, whereby servicing has been retained by the Company.

³ Net charge-offs are associated with $410 million and $501 million of managed securitized residential loans at December 31, 2016 and 2015, respectively. Net charge-off data is not reported to the Company for the remaining balance of $126.2 billion and $116.5 billion of managed securitized residential loans at December 31, 2016 and 2015, respectively.

⁴ Comprised of unsecuritized residential loans the Company originated and sold to private investors with servicing rights retained. Net charge-offs on these loans are not presented in the table as the data is not reported to the Company by the private investors that own these related loans.

Borrowings and Contractual Commitments Contractual Commitments (Tables)

Unrecorded Unconditional Purchase Obligations Disclosure [Table Text Block]

The following table presents the Company's significant contractual commitments at December 31, 2016, except for long-term debt and short-term borrowings, operating leases, and pension and other postretirement benefit plans. Information on those obligations is included above, in Note 8, "Premises and Equipment," and in Note 15, "Employee Benefit Plans." Capital lease obligations were immaterial at December 31, 2016 and are not presented in the table.



	Payments Due by Period
(Dollars in millions)	2017		2018		2019		2020		2021		Thereafter		Total
Unfunded lending commitments		$26,057		$8,786		$13,727		$16,439		$14,568		$11,994		$91,571
Purchase obligations ¹	497		22		20		14		12		219		784
Consumer and other time deposits ^{2, 3}	3,893		1,794		1,082		983		603		1,112		9,467
Brokered time deposits ³	161		102		175		232		131		123		924
Foreign time deposits ³	610		—		—		—		—		—		610
Commitments to fund partnership investments ⁴	563		—		—		—		—		—		563

¹ For legally binding purchase obligations of $5 million or more, amounts include either termination fees under the associated contracts when early termination provisions exist, or the total potential obligation over the full contractual term for noncancelable purchase obligations. Payments made towards the purchase of goods or services under these contracts totaled $236 million, $243 million, and $223 million in 2016, 2015, and 2014, respectively.

² The aggregate amount of time deposit accounts in denominations of $250,000 or more totaled $1.7 billion and $1.4 billion at December 31, 2016 and 2015, respectively.

³ Amounts do not include interest.

⁴ Commitments to fund investments in affordable housing and other partnerships do not have defined funding dates as certain criteria must be met before the Company is obligated to fund. Accordingly, these commitments are considered to be due on demand for presentation purposes. See Note 10, "Certain Transfers of Financial Assets and Variable Interest Entities," in this Form 10-K for additional information.

Borrowings and Contractual Commitments Schedule of Long-term Debt Maturities (Tables)

Schedule of Long-term Debt Instruments [Table Text Block]

Long-term debt at December 31 consisted of the following:



	2016				2015
(Dollars in millions)	Maturity Date(s)	Interest Rate(s)	Balance		Balance
Parent Company Only:
Senior, fixed rate	2017 - 2028	2.35% - 6.00%		$3,818		$3,614
Senior, variable rate	2017 - 2026	0.25 - 2.50	314		331
Subordinated, fixed rate	2026	6.00	200		200
Junior subordinated, variable rate	2027 - 2028	1.58 - 1.83	627		627
Total			4,959		4,772
Less: Debt issuance costs ¹			9
Total Parent Company debt			4,950		4,772
Subsidiaries ²:
Senior, fixed rate ³	2017 - 2053	0.80 - 9.27	2,539		1,620
Senior, variable rate	2017 - 2043	0.61 - 2.27	2,613		1,097
Subordinated, fixed rate ⁴	2017 - 2026	3.30 - 7.25	1,651		973
Total			6,803		3,690
Less: Debt issuance costs ¹			5
Total subsidiaries debt			6,798		3,690

Total long-term debt				$11,748		$8,462

¹Related to the Company's adoption of ASU 2015-03. Debt issuance costs were immaterial in the comparative prior year period, and accordingly, were not reclassified from other assets to long-term debt. See Note 1, "Significant Accounting Policies," for additional information.

²88% and 81% of total subsidiary debt was issued by the Bank as of December 31, 2016 and 2015, respectively.

³Includes leases and other obligations that do not have a stated interest rate.

⁴Includes $963 million and $973 million of subordinated debt measured at fair value at December 31, 2016 and 2015, respectively.

Schedule of Maturities of Long-term Debt [Table Text Block]

Maturities of long-term debt at December 31, 2016 were as follows:



(Dollars in millions)	Parent Company		Subsidiaries
2017		$482		$1,305
2018	874		1,237
2019	792		27
2020	—		1,721
2021	969		505
Thereafter	1,842		2,008
Total maturities	4,959		6,803
Less: Debt issuance costs	9		5
Total long-term debt		$4,950		$6,798

Net Income Per Common Share (Tables)

Reconciliation of Net Income/(Loss) to Net Income/(Loss) Available to Common Shareholders

Reconciliations of net income to net income available to common shareholders and the difference between average basic common shares outstanding and average diluted common shares outstanding are presented in the following table.



	Year Ended December 31
(Dollars and shares in millions, except per share data)	2016			2015			2014
Net income		$1,878			$1,933			$1,774
Preferred dividends	(66		)	(64		)	(42		)
Dividends and undistributed earnings allocated to unvested shares	(1		)	(6		)	(10		)
Net income available to common shareholders		$1,811			$1,863			$1,722

Average basic common shares	499			515			528
Effect of dilutive securities:
Stock options	1			2			1
Restricted stock, RSUs, and warrants	3			4			4
Average diluted common shares	503			521			533

Net income per average common share - diluted		$3.60			$3.58			$3.23
Net income per average common share - basic	3.63			3.62			3.26

Capital (Tables)

Assets Subject to Regulatory Capital Requirements



	2016				2015
(Dollars in millions)	Amount		Ratio		Amount		Ratio
SunTrust Banks, Inc.
CET1		$16,953	9.59	%		$16,421	9.96	%
Tier 1 capital	18,186		10.28		17,804		10.80
Total capital	21,685		12.26		20,668		12.54
Leverage			9.22				9.69
SunTrust Bank
CET1		$18,535	10.71	%		$17,859	11.02	%
Tier 1 capital	18,573		10.73		17,908		11.05
Total capital	21,276		12.29		20,101		12.40
Leverage			9.63				9.96

Preferred Stock



(Dollars in millions)	2016		2015		2014
Series A (1,725 shares outstanding)		$172		$172		$172
Series B(1,025 shares outstanding)	103		103		103
Series E (4,500 shares outstanding)	450		450		450
Series F (5,000 shares outstanding)	500		500		500
Total preferred stock		$1,225		$1,225		$1,225

Income Taxes (Tables)

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

The components of the provision for income taxes included in the Consolidated Statements of Income for the years ended December 31 are presented in the following table:



(Dollars in millions)	2016		2015			2014
Current income tax provision:
Federal		$667		$707			$365
State	27		36			29
Total	694		743			394
Deferred income tax provision/(benefit):
Federal	59		27			99
State	52		(6		)	—
Total	111		21			99
Total provision for income taxes		$805		$764			$493

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

A reconciliation of the provision for income taxes, using the statutory federal income tax rate of 35%, to the Company’s actual provision for income taxes and the effective tax rate during the years ended December 31 are presented in the following table:



	2016							2015					2014
(Dollars in millions)	Amount				% of Pre-Tax Income			Amount			% of Pre-Tax Income		Amount			% of Pre-Tax Income
Income tax provision at federal statutory rate		$939			35.0	%			$944		35.0	%		$793		35.0	%
Increase/(decrease) resulting from:
State income taxes, net	53				2.0			25			0.9		12			0.5
Tax-exempt interest	(86		)		(3.2	)		(88		)	(3.3	)	(89		)	(3.9	)
Changes in UTBs (including interest), net	6				0.2			(31		)	(1.1	)	(82		)	(3.6	)
Income tax credits, net of amortization ¹	(86		)		(3.2	)		(69		)	(2.6	)	(65		)	(2.9	)
Non-deductible expenses	8				0.3			—			—		(57		)	(2.5	)
Other	(29		)	²	(1.1	)	²	(17		)	(0.6	)	(19		)	(0.8	)
Total provision for income taxes and effective tax rate		$805			30.0	%			$764		28.3	%		$493		21.8	%

¹Excludes income tax benefits of $2 million, $6 million, and $21 million for the years ended December 31, 2016, 2015, and 2014, respectively, related to tax credits, which were recognized as a reduction to the related investment asset.

²Includes income tax benefits of $15 million related to the Company's early adoption of ASU 2016-09. See Note 1, "Significant Accounting Policies," for additional information.

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

The significant DTAs and DTLs at December 31, net of the federal impact for state taxes, are presented in the following table:



(Dollars in millions)	2016			2015
DTAs:
ALLL		$639			$651
Accrued expenses	275			297
State NOLs and other carryforwards	170			192
Net unrealized losses in AOCI	472			257
Other	70			97
Total gross DTAs	1,626			1,494
Valuation allowance	(80		)	(79		)
Total DTAs	1,546			1,415
DTLs:
Leasing	659			707
Compensation and employee benefits	179			140
MSRs	370			372
Loans	142			109
Goodwill and intangible assets	233			216
Fixed assets	113			131
Other	82			65
Total DTLs	1,778			1,740
Net DTL		($232	)		($325	)

Summary of Income Tax Contingencies [Table Text Block]

The following table provides a rollforward of the Company's gross federal and state UTBs, excluding interest and penalties, during the years ended December 31:



(Dollars in millions)	2016			2015
Balance at January 1		$100			$210
Increases in UTBs related to prior years	18			4
Decreases in UTBs related to prior years	(4		)	(4		)
Increases in UTBs related to the current year	13			10
Decreases in UTBs related to settlements	(16		)	(119		)
Decreases in UTBs related to lapse of the applicable statutes of limitations	—			(1		)
Balance at December 31		$111			$100

Employee Benefit Plans (Tables)

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]

The following table presents a summary of stock options, restricted stock, and RSU activity for the years ended December 31:



	Stock Options					Restricted Stock							Restricted Stock Units
(Dollars in millions, except per share data)	Shares		Price Range	Weighted Average Exercise Price		Shares		Deferred Compensation			Weighted Average Grant Price		Shares		Weighted Average Grant Price
Balance, January 1, 2014	10,929,371		$9.06 - 150.45		$49.86	3,983,538			$50			$27.04	2,496,178			$26.69
Granted	—		—	—		21,427		—			39.20		1,590,075		36.67
Exercised/vested	(426,889	)	9.06 - 32.27	20.86		(957,308	)	—			29.31		(338,196	)	32.80
Cancelled/expired/forfeited	(2,774,725	)	23.70 - 149.81	71.10		(117,798	)	(2		)	25.60		(58,793	)	37.73
Amortization of restricted stock compensation	—		—	—		—		(27		)	—		—		—
Balance, December 31, 2014	7,727,757		9.06 - 150.45	43.84		2,929,859		21			26.45		3,689,264		31.15
Granted	—		—	—		20,412		1			41.15		1,670,587		40.54
Exercised/vested	(687,832	)	9.06 - 32.27	20.38		(1,510,045	)	—			22.86		(883,621	)	26.39
Cancelled/expired/forfeited	(1,821,667	)	23.70 - 150.45	73.01		(106,151	)	(4		)	29.95		(157,390	)	39.19
Amortization of restricted stock compensation	—		—	—		—		(16		)	—		—		—
Balance, December 31, 2015	5,218,258		9.06 - 85.34	36.75		1,334,075		2			30.44		4,318,840		35.44
Granted	—		—	—		11,312		1			42.44		2,548,326		35.08
Exercised/vested	(1,547,255	)	9.06 - 32.27	16.25		(1,332,995	)	—			30.43		(2,428,213	)	30.52
Cancelled/expired/forfeited	(417,210	)	21.67 - 71.03	67.59		(1,080	)	(1		)	35.03		(263,144	)	36.67
Amortization of restricted stock compensation	—		—	—		—		(2		)	—		—		—
Balance, December 31, 2016	3,253,793		$9.06 - 85.34		$42.54	11,312			$—			$42.44	4,175,809			$36.27
Exercisable, December 31, 2016	3,253,793				$42.54

The following table presents stock option information at December 31, 2016:



	Options Outstanding						Options Exercisable
(Dollars in millions, except per share data)	Number Outstanding at December 31, 2016	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Total Aggregate Intrinsic Value		Number Exercisable at December 31, 2016	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Total Aggregate Intrinsic Value
Range of Exercise Prices:
$9.06 to 49.46	1,904,207		$22.00	3.73		$63	1,904,207		$22.00	3.73		$63
$49.47 to 64.57	781	56.34		0.84	—		781	56.34		0.84	—
$64.58 to 85.34	1,348,805	71.53		0.51	—		1,348,805	71.53		0.51	—
	3,253,793		$42.54	2.39		$63	3,253,793		$42.54	2.39		$63

Schedule of Share-based Compensation Arrangement by Share-based Payment Award, Restricted Stock Units, Vested and Expected to Vest [Table Text Block]

Additional option and stock-based compensation information at December 31 is presented in the following table:



(Dollars in millions)	2016		2015		2014
Intrinsic value of options exercised ¹		$43		$15		$8
Fair value of vested restricted shares ¹	41		35		28
Fair value of vested RSUs ¹	74		23		11

¹Measured as of the grant date.

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]

Stock-based compensation expense recognized in noninterest expense consisted of the following:



	Years Ended December 31
(Dollars in millions)	2016		2015		2014
Stock options		$—		$1		$2
Restricted stock	2		16		27
Phantom stock units ¹	67		32		13
RSUs	56		46		34
Total stock-based compensation		$125		$95		$76
Stock-based compensation tax benefit		$48		$36		$29

¹Phantom stock units are settled in cash.

Schedule of Accumulated and Projected Benefit Obligations [Table Text Block]

The following table presents the change in benefit obligations, change in fair value of plan assets, funded status, accumulated benefit obligation, and the weighted average discount rate related to the Company's pension and other postretirement benefits plans for the years ended December 31:



	Pension Benefits ¹						Other Postretirement Benefits
(Dollars in millions)	2016			2015			2016			2015
Benefit obligation, beginning of year		$2,716			$2,935			$65			$69
Service cost	5			5			—			—
Interest cost	97			116			2			2
Plan participants’ contributions	—			—			4			6
Actuarial loss/(gain)	76			(171		)	(4		)	(2		)
Benefits paid	(142		)	(164		)	(9		)	(10		)
Administrative expenses paid from pension trust	(5		)	(5		)	—			—
Benefit obligation, end of year ²		$2,747			$2,716			$58			$65

Change in plan assets:
Fair value of plan assets, beginning of year		$2,879			$3,080			$156			$160
Actual return on plan assets	279			(37		)	5			1
Employer contributions ³	5			5			—			—
Plan participants’ contributions	—			—			5			5
Benefits paid	(142		)	(164		)	(9		)	(10		)
Administrative expenses paid from pension trust	(5		)	(5		)	—			—
Fair value of plan assets, end of year ⁴		$3,016			$2,879			$157			$156

Funded status at end of year ^{5, 6}		$269			$163			$99			$91
Funded status at end of year (%)	110		%	106		%

Accumulated benefit obligation		$2,747			$2,716

Discount rate	4.18		%	4.44		%	3.70		%	3.95		%

¹ Employer contributions represent the benefits that were paid to nonqualified plan participants. Unfunded nonqualified supplemental pension plans are not funded through plan assets.

²Includes $80 million and $81 million of benefit obligations for the unfunded nonqualified supplemental pension plans at December 31, 2016 and 2015, respectively.

³The Company contributed less than $1 million to the other postretirement benefits plans during both 2016 and 2015.

⁴Includes $2 million and $1 million of the Company's common stock acquired by the asset manager and held as part of the equity portfolio for pension benefits at December 31, 2016 and 2015, respectively. During both 2016 and 2015, there was no SunTrust common stock held in the other postretirement benefit plans.

⁵Pension benefits recorded in the Consolidated Balance Sheets included other assets of $349 million and $244 million, and other liabilities of $80 million and $81 million, at December 31, 2016 and 2015, respectively.

⁶Other postretirement benefits recorded in the Consolidated Balance Sheets included other assets of $99 million and $91 million at December 31, 2016 and 2015, respectively.

Schedule of Net Benefit Costs [Table Text Block]

Components of net periodic benefit for the years ended December 31 are presented in the following table:



	Pension Benefits ¹									Other Postretirement Benefits
(Dollars in millions)	2016			2015			2014			2016			2015			2014
Service cost		$5			$5			$5			$—			$—			$—
Interest cost	97			116			124			2			2			3
Expected return on plan assets	(186		)	(206		)	(200		)	(5		)	(5		)	(5		)
Amortization of prior service credit	—			—			—			(6		)	(6		)	(6		)
Amortization of actuarial loss	25			21			16			—			—			—
Net periodic benefit		($59	)		($64	)		($55	)		($9	)		($9	)		($8	)

Weighted average assumptions used to determine net periodic benefit:
Discount rate	4.44		%	4.09		%	4.98		%	3.95		%	3.60		%	4.15		%
Expected return on plan assets	6.68			6.91			7.17			3.13			3.50			3.68

¹Administrative fees are recognized in service cost for each of the periods presented.

Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block]

Components of the benefit obligations AOCI balance at December 31 were as follows:



	Pension Benefits				Other Postretirement Benefits
(Dollars in millions)	2016		2015		2016			2015
Prior service credit		$—		$—		($59	)		($64	)
Net actuarial loss/(gain)	1,031		1,072		(15		)	(11		)
Total AOCI, pre-tax		$1,031		$1,072		($74	)		($75	)

Other changes in plan assets and benefit obligations recognized in AOCI during 2016 were as follows:



(Dollars in millions)	Pension Benefits			Other Postretirement Benefits
Current year actuarial gain		($16	)		($5	)
Amortization of prior service credit	—			6
Amortization of actuarial loss	(25		)	—
Total recognized in AOCI, pre-tax		($41	)		$1
Total recognized in net periodic benefit and AOCI, pre-tax		($100	)		($8	)

Schedule of Allocation of Plan Assets [Table Text Block]

The following tables present combined pension and other postretirement benefit plan assets measured at fair value. See Note 18, "Fair Value Election and Measurement" for level definitions within the fair value hierarchy.



				Fair Value Measurements at December 31, 2016 ¹
(Dollars in millions)	Total			Level 1		Level 2			Level 3
Money market funds ²		$112			$112		$—			$—
Equity securities	1,415			1,415		—			—
Mutual funds ³:
Equity index fund	47			47		—			—
Tax exempt municipal bond funds	82			82		—			—
Taxable fixed income index funds	13			13		—			—
Futures contracts	(5		)	—		(5		)	—
Fixed income securities	1,486			—		1,486			—
Other assets	6			6		—			—
Total plan assets		$3,156			$1,675		$1,481			$—

¹Fair value measurements do not include pension benefits accrued income amounting to less than 0.6% of total plan assets.

²Includes $16 million for other postretirement benefit plans.

³Relates exclusively to other postretirement benefit plans.



				Fair Value Measurements at December 31, 2015 ¹
(Dollars in millions)	Total			Level 1		Level 2			Level 3
Money market funds ²		$83			$83		$—			$—
Equity securities	1,416			1,416		—			—
Mutual funds ³:
Equity index fund	48			48		—			—
Tax exempt municipal bond funds	84			84		—			—
Taxable fixed income index funds	13			13		—			—
Futures contracts	(11		)	—		(11		)	—
Fixed income securities	1,381			—		1,381			—
Other assets	11			11		—			—
Total plan assets		$3,025			$1,655		$1,370			$—

¹Fair value measurements do not include pension benefits accrued income amounting to less than 0.4% of total plan assets.

²Includes $11 million for other postretirement benefit plans.

³Relates exclusively to other postretirement benefit plans.

Target allocations for pension and other postretirement benefits at December 31, by asset category, are presented below:



	Pension Benefits						Other Postretirement Benefits
	Target Allocation		% of plan assets				Target Allocation		% of plan assets
	Target Allocation		2016		2015		Target Allocation		2016		2015
Cash equivalents	0-10	%	3	%	3	%	5-15	%	10	%	7	%
Equity securities	0-50		47		49		20-40		30		31
Debt securities	50-100		50		48		50-70		60		62
Total			100	%	100	%			100	%	100	%

Schedule of Expected Benefit Payments [Table Text Block]

Expected cash flows for the pension and other postretirement benefit plans are presented in the following table:



(Dollars in millions)	Pension Benefits ¹		Other Postretirement Benefits (excluding Medicare Subsidy) ²
Employer Contributions:
2017 (expected) to plan trusts		$—		$—
2017 (expected) to plan participants ³	11		—

Expected Benefit Payments:
2017	183		6
2018	168		6
2019	166		5
2020	165		5
2021	165		4
2022 - 2026	812		19

¹Based on the funding status and ERISA limitations, the Company anticipates contributions to the Retirement Plan will not be required during 2017.

²Expected payments under other postretirement benefit plans are shown net of participant contributions.

³The expected benefit payments for the SERP will be paid directly from the Company's corporate assets.

Guarantees (Tables)

Repurchase Requests [Table Text Block]

Repurchase requests from GSEs, Ginnie Mae, and non-agency investors, for all vintages, are presented in the following table that summarizes demand activity for the years ended December 31.



(Dollars in millions)	2016			2015			2014
Pending repurchase requests, beginning of period		$17			$47			$126
Repurchase requests received	44			73			158
Repurchase requests resolved:
Repurchased	(18		)	(22		)	(28		)
Cured	(29		)	(81		)	(209		)
Total resolved	(47		)	(103		)	(237		)
Pending repurchase requests, end of period ¹		$14			$17			$47

Percent from non-agency investors:
Pending repurchase requests, end of period	40.4		%	32.9		%	6.7		%
Repurchase requests received	7.1		%	7.2		%	0.9		%

¹Comprised of $8 million, $11 million, and $44 million from the GSEs, and $6 million, $6 million, and $3 million from non-agency investors at December 31, 2016, 2015, and 2014 respectively.

Mortgage Loan Repurchase Losses [Table Text Block]

The following table summarizes the changes in the Company’s reserve for residential mortgage loan repurchases for the years ended December 31:



(Dollars in millions)	2016			2015			2014
Balance, beginning of period		$57			$85			$78
Repurchase (benefit)/provision	(17		)	(12		)	12
Charge-offs, net of recoveries	—			(16		)	(5		)
Balance, end of period		$40			$57			$85

Repurchased Mortgage Loan [Table Text Block]

The following table summarizes the carrying value of the Company's outstanding repurchased mortgage loans at December 31:



(Dollars in millions)	2016		2015
Outstanding repurchased mortgage loans:
Performing LHFI		$230		$255
Nonperforming LHFI	12		17
Total carrying value of outstanding repurchased mortgage loans		$242		$272

Derivative Financial Instruments (Tables)

[1] Amounts are recognized in trading income in the Consolidated Statements of Income.

Derivative Positions

The following tables present the Company’s derivative positions at December 31, 2016 and 2015. The notional amounts in the tables are presented on a gross basis and have been classified within derivative assets or derivative liabilities based on the estimated fair value of the individual contract at December 31, 2016 and 2015. Gross positive and gross negative fair value amounts associated with respective notional amounts are presented without consideration of any netting agreements, including collateral arrangements. Net fair value derivative amounts are adjusted on an aggregate basis, where applicable, to take into consideration the effects of legally enforceable master netting agreements, including any cash collateral received or paid, and are recognized in trading assets and derivative instruments or trading liabilities and derivative instruments on the Consolidated Balance Sheets. For contracts constituting a combination of options that contain a written option and a purchased option (such as a collar), the notional amount of each option is presented separately, with the purchased notional amount generally being presented as a derivative asset and the written notional amount being presented as a derivative liability. For contracts that contain a combination of options, the fair value is generally presented as a single value with the purchased notional amount if the combined fair value is positive, and with the written notional amount if the combined fair value is negative.



	December 31, 2016
	Asset Derivatives					Liability Derivatives
(Dollars in millions)	Notional Amounts		Fair Value			Notional Amounts		Fair Value
Derivative instruments designated in cash flow hedging relationships ¹
Interest rate contracts hedging floating rate loans		$6,400		$34			$11,050		$265
Derivative instruments designated in fair value hedging relationships ²
Interest rate contracts hedging fixed rate debt	600		2			4,510		81
Interest rate contracts hedging brokered CDs	60		—			30		—
Total	660		2			4,540		81
Derivative instruments not designated as hedging instruments ³
Interest rate contracts hedging:
MSRs ⁴	12,165		413			18,774		335
LHFS, IRLCs ⁵	11,774		134			8,306		58
LHFI	100		2			36		1
Trading activity ⁶	70,599		1,536			67,477		1,401
Foreign exchange rate contracts hedging trading activity	3,231		161			3,360		148
Credit contracts hedging:
Loans	15		—			620		8
Trading activity ⁷	2,128		34			2,271		33
Equity contracts hedging trading activity ⁶	23,164		2,095			35,312		2,477
Other contracts:
IRLCs and other ⁸	2,412		28			668		22
Commodities	747		75			746		73
Total	126,335		4,478			137,570		4,556
Total derivative instruments		$133,395		$4,514			$153,160		$4,902

Total gross derivative instruments, before netting				$4,514					$4,902
Less: Legally enforceable master netting agreements			(3,239		)			(3,239		)
Less: Cash collateral received/paid			(291		)			(1,265		)
Total derivative instruments, after netting				$984					$398