Morgan Stanley 2014 Annual Report Download - page 185

MORGAN STANLEY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Counterparty
and Cash
Collateral
Netting
Balance at
December 31,
2014
(dollars in millions)
Liabilities at Fair Value
Commercial paper and other short-term
borrowings ............................. $ — $ 1,765 $ — $ — $ 1,765
Trading liabilities:
U.S. government and agency securities:
U.S. Treasury securities ............. 14,199 — — — 14,199
U.S. agency securities .............. 1,274 85 — — 1,359
Total U.S. government and agency
securities .................. 15,473 85 — — 15,558
Other sovereign government obligations .... 11,653 2,109 — — 13,762
Corporate and other debt:
State and municipal securities ........ — 1 — — 1
Corporate bonds ................... — 5,943 78 — 6,021
Unfunded lending commitments ...... — 10 5 — 15
Other debt ....................... — 63 38 — 101
Total corporate and other debt .... — 6,017 121 — 6,138
Corporate equities(1) ................... 31,340 326 45 — 31,711
Derivative and other contracts:
Interest rate contracts ............... 602 469,319 2,657 — 472,578
Credit contracts ................... — 29,997 2,112 — 32,109
Foreign exchange contracts .......... 21 72,233 98 — 72,352
Equity contracts ................... 416 52,247 2,909 — 55,572
Commodity contracts ............... 4,817 15,584 1,122 — 21,523
Other ........................... — 172 — — 172
Netting(2) ........................ (4,910) (564,127) (4,220) (40,837) (614,094)
Total derivative and other
contracts ................... 946 75,425 4,678 (40,837) 40,212
Total trading liabilities .............. 59,412 83,962 4,844 (40,837) 107,381
Obligation to return securities received as
collateral ............................... 25,629 56 — — 25,685
Securities sold under agreements to repurchase . . — 459 153 — 612
Other secured financings .................... — 4,355 149 — 4,504
Long-term borrowings ...................... — 29,840 1,934 — 31,774
Total liabilities measured at fair value .......... $85,041 $ 120,437 $ 7,080 $(40,837) $ 171,721
(1) The Company holds or sells short for trading purposes equity securities issued by entities in diverse industries and of varying size.
(2) For positions with the same counterparty that cross over the levels of the fair value hierarchy, both counterparty netting and cash
collateral netting are included in the column titled “Counterparty and Cash Collateral Netting.” For contracts with the same counterparty,
counterparty netting among positions classified within the same level is included within that level. For further information on derivative
instruments and hedging activities, see Note 12.
(3) Amount represents mortgage servicing rights (“MSRs”) accounted for at fair value.
Transfers Between Level 1 and Level 2 During 2014.
For assets and liabilities that were transferred between Level 1 and Level 2 during the period, fair values are
ascribed as if the assets or liabilities had been transferred as of the beginning of the period.
In 2014, there were no material transfers between Level 1 and Level 2.
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