Wells Fargo 2014 Annual Report Download - page 157

The following table shows the gross unrealized losses and
fair value of debt and perpetual preferred investment securities
by those rated investment grade and those rated less than
investment grade according to their lowest credit rating by
Standard & Poor’s Rating Services (S&P) or Moody’s Investors
Service (Moody’s). Credit ratings express opinions about the
credit quality of a security. Securities rated investment grade,
that is those rated BBB- or higher by S&P or Baa3 or higher by
Moody’s, are generally considered by the rating agencies and
market participants to be low credit risk. Conversely, securities
rated below investment grade, labeled as "speculative grade" by
the rating agencies, are considered to be distinctively higher
credit risk than investment grade securities. We have also
included securities not rated by S&P or Moody’s in the table
below based on our internal credit grade of the securities (used
for credit risk management purposes) equivalent to the credit
rating assigned by major credit agencies. The unrealized losses
and fair value of unrated securities categorized as investment
grade based on internal credit grades were $25 million and
$1.6 billion, respectively, at December 31, 2014, and $18 million
and $1.9 billion, respectively, at December 31, 2013. If an
internal credit grade was not assigned, we categorized the
security as non-investment grade.
Investment grade Non-investment grade
(in millions)
Gross
unrealized
losses Fair value
Gross
unrealized
losses Fair value
December 31, 2014
Available-for-sale securities:
Securities of U.S. Treasury and federal agencies $ (138) 12,857 — —
Securities of U.S. states and political subdivisions (459) 13,600 (40) 353
Mortgage-backed securities:
Federal agencies (751) 39,560 — —
Residential — 139 (24) 951
Commercial (24) 3,366 (33) 368
Total mortgage-backed securities (775) 43,065 (57) 1,319
Corporate debt securities (39) 1,807 (131) 1,132
Collateralized loan and other debt obligations (172) 16,609 (12) 104
Other (23) 782 (4) 203
Total debt securities (1,606) 88,720 (244) 3,111
Perpetual preferred securities (70) 725 — —
Total available-for-sale securities (1,676) 89,445 (244) 3,111
Held-to-maturity securities:
Securities of U.S. Treasury and federal agencies (8) 1,889 — —
Collateralized loan and other debt obligations (13) 1,391 — —
Total held-to-maturity securities (21) 3,280 — —
Total $ (1,697) 92,725 (244) 3,111
December 31, 2013
Available-for-sale securities:
Securities of U.S. Treasury and federal agencies $ (329) 5,786 — —
Securities of U.S. states and political subdivisions (671) 12,915 (56) 443
Mortgage-backed securities:
Federal agencies (3,614) 68,177 — —
Residential (2) 177 (38) 1,297
Commercial (46) 3,364 (69) 791
Total mortgage-backed securities (3,662) 71,718 (107) 2,088
Corporate debt securities (96) 2,343 (44) 627
Collateralized loan and other debt obligations (72) 7,376 (21) 169
Other (19) 1,874 (10) 181
Total debt securities (4,849) 102,012 (238) 3,508
Perpetual preferred securities (60) 732 — —
Total available-for-sale securities (4,909) 102,744 (238) 3,508
Held-to-maturity securities:
Federal agency mortgage-backed securities (99) 6,153 — —
Total held-to-maturity securities (99) 6,153 — —
Total $ (5,008) 108,897 (238) 3,508
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