PNC Bank 2012 Annual Report Download - page 230
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Gains (losses) on derivative instruments not designated in hedge relationships:
Table 137: Gains (Losses) on Derivatives Not Designated as Hedging Instruments under GAAP
Year ended December 31
In millions 2012 2011
Derivatives used for residential mortgage banking activities:
Residential mortgage servicing
Interest rate contracts $ 269 $571
Loan sales
Interest rate contracts 127 54
Gains (losses) included in residential mortgage banking activities (a) $ 396 $625
Derivatives used for commercial mortgage banking activities:
Interest rate contracts (b) (c) $35 $ 5
Credit contracts (c) (3) 6
Gains (losses) from commercial mortgage banking activities $ 32 $ 11
Derivatives used for customer-related activities:
Interest rate contracts $ 106 $ 78
Foreign exchange contracts 83 104
Equity contracts (4) (3)
Credit contracts (3) 2
Gains (losses) from customer-related activities (c) $ 182 $181
Derivatives used for other risk management activities:
Interest rate contracts $ (11) $ (43)
Foreign exchange contracts (2) (2)
Credit contracts (1) (1)
Other contracts (d) (94) 11
Gains (losses) from other risk management activities (c) $(108) $ (35)
Total gains (losses) from derivatives not designated as hedging instruments $ 502 $782
(a) Included in Residential mortgage noninterest income.
(b) Included in Corporate services noninterest income.
(c) Included in Other noninterest income.
(d) Includes PNC’s obligation to fund a portion of certain BlackRock LTIP programs, a forward purchase commitment for certain loans upon conversion from a variable rate to a fixed
rate, and the swaps entered into in connection with sales of a portion of Visa Class B common shares in 2012.
C
REDIT
D
ERIVATIVES
The credit derivative underlying is based on the credit risk of a specific entity, entities, or an index. As discussed above, we enter
into credit derivatives, specifically credit default swaps and risk participation agreements, as part of our commercial mortgage
banking hedging activities and for customer and other risk management purposes. Detail regarding credit default swaps and risk
participations sold follows.
The PNC Financial Services Group, Inc. – Form 10-K 211