STI 2018 Annual Report

Notes to Consolidated Financial Statements, continued 143 December 31, 2018 December 31, 2017 Fair Value Fair Value (Dollars in millions) Notional Amounts Asset Derivatives Liability Derivatives Notional Amounts Asset Derivative s Liability Derivatives Derivative instruments designated in hedging relationships Cash flow hedges: 1 Interest rate contracts hedging floating rate LHFI $10,500 $1 $2 $14,200 $2 $252 Subtotal 10,500 1 2 14,200 2 252 Fair value hedges: 2 Interest rate contracts hedging fixed rate debt 9,550 1 1 5,920 1 58 Interest rate contracts hedging brokered time deposits 59 — — 60 — — Subtotal 9,609 1 1 5,980 1 58 Derivative instruments not designated as hedging instruments 3 Interest rate contracts hedging: Residential MSRs 4 28,011 54 10 42,021 119 119 LHFS, IRLCs 5 4,891 18 38 7,590 9 6 LHFI 159 — — 175 2 2 Trading activity 6 127,286 771 687 126,366 1,066 946 Foreign exchange rate contracts hedging loans and trading activity 9,824 129 119 7,058 110 102 Credit contracts hedging: LHFI 830 — 14 515 — 11 Trading activity 7 4,058 97 95 3,454 15 12 Equity contracts hedging trading activity 6 34,471 1,447 1,644 38,907 2,499 2,857 Other contracts: IRLCs and other 8 1,393 20 15 2,017 18 16 Commodity derivatives 2,020 93 91 1,422 63 61 Subtotal 212,943 2,629 2,713 229,525 3,901 4,132 Total derivative instruments $233,052 $2,631 $2,716 $249,705 $3,904 $4,442 Total gross derivative instruments (before netting) $2,631 $2,716 $3,904 $4,442 Less: Legally enforceable master netting agreements (1,654) (1,654) (2,731) (2,731) Less: Cash collateral received/paid (338) (652) (371) (1,303) Total derivative instruments (after netting) $639 $410 $802 $408 1 See “Cash Flow Hedging” in this Note for further discussion. 2 See “Fair Value Hedging” in this Note for further discussion. 3 See “Economic Hedging Instruments and Trading Activities” in this Note for further discussion. 4 Notional amounts include $921 million and $16.6 billion related to interest rate futures at December 31, 2018 and 2017, respectively. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table. 5 Notional amounts include $116 million and $190 million related to interest rate futures at December 31, 2018 and 2017, respectively. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table. 6 Notional amounts include $1.2 billion and $9.8 billion related to interest rate futures at December 31, 2018 and 2017, and $136 million and $1.2 billion related to equity futures at December 31, 2018 and 2017, respectively. These futures contracts settle in cash daily, one day in arrears. The derivative asset or liability associated with the one day lag is included in the fair value column of this table. Notional amounts also include amounts related to interest rate swaps hedging fixed rate debt. 7 Notional amounts include $6 million and $4 million from purchased credit risk participation agreements at December 31, 2018 and December 31, 2017, and $33 million and $11 million from written credit risk participation agreements at December 31, 2018 and December 31, 2017, respectively. These notional amounts are calculated as the notional of the derivative participated adjusted by the relevant RWA conversion factor. 8 Notional amounts include $41 million and $49 million related to the Visa derivative liability at December 31, 2018 and December 31, 2017, respectively. See Note 18, "Guarantees" for additional information.