Morgan Stanley 2014 Annual Report Download - page 125

associated with these instruments may expire unused, the amounts shown do not necessarily reflect the actual
future cash funding requirements:
Years to Maturity
Less
than 1 1-3 3-5 Over 5
Total at
December 31,
2014
(dollars in millions)
Letters of credit and other financial guarantees obtained to
satisfy collateral requirements .................... $ 457 $ 1 $ — $ 2 $ 460
Investment activities .............................. 511 82 24 446 1,063
Primary lending commitments—investment grade(1) .... 8,507 14,874 35,850 1,437 60,668
Primary lending commitments—non-investment
grade(1) ...................................... 1,101 5,148 13,062 2,051 21,362
Secondary lending commitments(2) .................. 1 32 38 116 187
Commitments for secured lending transactions ......... 1,194 534 181 919 2,828
Forward starting reverse repurchase agreements and
securities borrowing agreements(3)(4) .............. 42,033 — — — 42,033
Commercial and residential mortgage-related
commitments ................................. 7 444 528 329 1,308
Underwriting commitments ........................ 290 — — — 290
Other lending commitments ........................ 4,284 1,089 364 98 5,835
Total ...................................... $58,385 $22,204 $50,047 $5,398 $136,034
(1) Total amount includes $49.9 billion of investment grade and $13.0 billion of non-investment grade unfunded commitments accounted for
as held for investment and $8.4 billion of investment grade and $7.4 billion of non-investment grade unfunded commitments accounted
for as held for sale at December 31, 2014. The remainder of these lending commitments is carried at fair value.
(2) These commitments are recorded at fair value within Trading assets and Trading liabilities in the Company’s consolidated statements of
financial condition (see Note 4 to the Company’s consolidated financial statements in Item 8).
(3) The Company enters into forward starting reverse repurchase and securities borrowing agreements (agreements that have a trade date at
or prior to December 31, 2014 and settle subsequent to period-end) that are primarily secured by collateral from U.S. government agency
securities and other sovereign government obligations. These agreements primarily settle within three business days, and of the total
amount at December 31, 2014, $41.2 billion settled within three business days.
(4) The Company also has a contingent obligation to provide financing to a clearinghouse through which it clears certain transactions. The
financing is required only upon the default of a clearinghouse member. The financing takes the form of a reverse repurchase facility, with
a maximum amount of approximately $0.5 billion.
For a further description of these commitments, see Note 13 to the Company’s consolidated financial statements
in Item 8 and “Quantitative and Qualitative Disclosures about Market Risk—Risk Management—Credit Risk” in
Item 7A.
In the normal course of business, the Company enters into various contractual obligations that may require future
cash payments. Contractual obligations include long-term borrowings, other secured financings, contractual
interest payments, contractual payments on time deposits, operating leases and purchase obligations.
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