Fifth Third Bank 2013 Annual Report Download - page 129

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
127 Fifth Third Bancorp
13. OFFSETTING DERIVATIVE FINANCIAL INSTRUMENTS
The Bancorp’s derivative transactions are generally governed by
ISDA Master Agreements and similar arrangements, which include
provisions governing the setoff of assets and liabilities between the
parties. When the Bancorp has more than one outstanding
derivative transaction with a single counterparty, the setoff
provisions contained within these agreements generally allow the
non-defaulting party the right to reduce its liability to the defaulting
party by amounts eligible for setoff, including the collateral received
as well as eligible offsetting transactions with that counterparty,
irrespective of the currency, place of payment, or booking office.
The Bancorp’s policy is to present its derivative assets and derivative
liabilities on the Consolidated Balance Sheets on a gross basis, even
when provisions allowing for setoff are in place.
Collateral amounts included in the table below consist primarily
of cash and highly-rated government-backed securities.
Gross Amount Gross Amounts Not Offset in the
Recognized in the Consolidated Balance Sheet
December 31, 2013 ($ in millions) Consolidated Balance Sheet(a) Derivatives Collateral(b) Net Amount
A
ssets
Derivatives $ 1,157 (321) (390) $ 446
Total assets 1,157 (321) (390) 446
Liabilities
Derivatives 753 (321) (302) 130
Total liabilities $ 753 (321) (302) $ 130
Gross Amount Gross Amounts Not Offset in the
Recognized in the Consolidated Balance Sheet
December 31, 2012 ($ in millions) Consolidated Balance Sheet(a) Derivatives Collateral(b) Net Amount
A
ssets
Derivatives $ 1,735 (291) (794) $ 650
Total assets 1,735 (291) (794) 650
Liabilities
Derivatives 915 (291) (505) 119
Total liabilities $ 915 (291) (505) $ 119
(a) Amount does not include the stock warrant associated with Vantiv Holding, LLC and interest rate lock commitments because these instruments are not subject to master netting or similar
arrangement.
(b) Amount of collateral received as an offset to asset positions or pledged as an offset to liability positions. Collateral values in excess of related derivative amounts recognized in the Consolidated Balance
Sheets were excluded from this table.
14. OTHER ASSETS
The following table provides the components of other assets included in the Consolidated Balance Sheets as of December 31:
($ in millions) 2013 2012
Partnership investments $1,687 1,657
Bank owned life insurance 1,587 1,547
Derivative instruments 1,553 1,972
A
ccounts receivable and drafts-in-process 1,433 1,155
Bankers' acceptances 763 398
Investment in Vantiv Holding, LLC 423 563
A
ccrued interest receivable 361 369
OREO and other repossessed personal property 306 329
Prepaid expenses 94 80
Income tax receivable 12 10
Other 139 124
Total $8,358 8,204
CDC, a wholly owned subsidiary of the Bancorp, was created to
invest in projects to create affordable housing, revitalize business
and residential areas, and preserve historic landmarks, which are
included above in partnership investments. In addition, Fifth Third
Capital Holdings, a wholly owned subsidiary of the Bancorp, invests
as a direct private equity investor and as a limited partner in private
equity funds, which are included above as partnership investments.
The Bancorp has determined that these partnership investments are
VIEs and the Bancorp’s investments represent variable interests.
See Note 10 for further information. Additionally, in response to
the issuance of the Volcker Rule in the fourth quarter of 2013, the