STI 2018 Annual Report

47 SELECTED FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE The following is a discussion of the more significant financial assets and financial liabilities that are measured at fair value on the Consolidated Balance Sheets at December 31, 2018 and 2017. For a complete discussion of our financial instruments measured at fair value and the methodologies used to estimate the fair values of our financial instruments, see Note 20, “Fair Value Election andMeasurement,” to the Consolidated Financial Statements in this Form 10-K. Trading Assets and Liabilities and Derivative Instruments Trading assets and derivative instruments increased $413 million, or 8%, compared to December 31, 2017. This increase was due primarily to increases in trading loans, agency MBS, U.S. Treasury securities, CP, and corporate and other debt securities, offset partially by decreases in federal agency securities and derivative instruments. These changes were driven by normal activity in the trading portfolio product mix as we manage our business and continue to meet our clients' needs. Trading liabilities and derivative instruments increased $321 million, or 25%, compared to December 31, 2017, driven by increases inU.S. Treasury securities and corporate and other debt securities. For composition and valuation assumptions related to our trading products, as well as additional information on our derivative instruments, see Note 5, “Trading Assets and Liabilities and Derivative Instruments,” Note 19, “Derivative Financial Instruments,” and the “Trading Assets and Derivative Instruments and Investment Securities” section of Note 20, “Fair Value Election andMeasurement,” to the Consolidated Financial Statements in this Form 10-K. Also, for a discussion of market risk associated with our trading activities, refer to the “Market Risk Management—Market Risk from Trading Activities” section of this MD&A. Investment Securities Investment Securities Portfolio Composition Table 12 December 31, 2018 (Dollars in millions) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Securities AFS: U.S. Treasury securities $4,277 $— $66 $4,211 Federal agency securities 221 2 2 221 U.S. states and political subdivisions 606 4 21 589 MBS - agency residential 23,161 128 425 22,864 MBS - agency commercial 2,688 8 69 2,627 MBS - non-agency commercial 943 — 27 916 Corporate and other debt securities 14 — — 14 Total securities AFS $31,910 $142 $610 $31,442 December 31, 2017 1 (Dollars in millions) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Securities AFS: U.S. Treasury securities $4,361 $2 $32 $4,331 Federal agency securities 257 3 1 259 U.S. states and political subdivisions 618 7 8 617 MBS - agency residential 22,616 222 134 22,704 MBS - agency commercial 2,121 3 38 2,086 MBS - non-agency residential 55 4 — 59 MBS - non-agency commercial 862 7 3 866 ABS 6 2 — 8 Corporate and other debt securities 17 — — 17 Total securities AFS $30,913 $250 $216 $30,947 1 Beginning January 1, 2018, we reclassified equity securities previously presented in Securities available for sale to Other assets on the Consolidated Balance Sheets. Prior periods have been revised to conform to the current presentation for comparability. See Note 11, "Other Assets," to the Consolidated Financial Statements in this Form 10-K for additional information.