NOTE 15. SHAREOWNERS' EQUITY
| (In millions) | 2013 | 2012 | 2011 | |||||
| Preferred stock issued | $ | - | $ | - | $ | - | ||
| Common stock issued | $ | 702 | $ | 702 | $ | 702 | ||
| Accumulated other comprehensive income | ||||||||
| Balance at January 1 | $ | (20,230) | $ | (23,974) | $ | (17,855) | ||
| Other comprehensive income before reclassifications | 8,844 | 841 | (9,601) | |||||
| Reclassifications from other comprehensive income | 2,266 | 2,903 | 3,482 | |||||
| Other comprehensive income, net, attributable to GE | 11,110 | 3,744 | (6,119) | |||||
| Balance at December 31 | $ | (9,120) | $ | (20,230) | $ | (23,974) | ||
| Other capital | ||||||||
| Balance at January 1 | $ | 33,070 | $ | 33,693 | $ | 36,890 | ||
| Gains (losses) on treasury stock dispositions and other | (576) | (623) | (703) | |||||
| Preferred stock redemption | - | - | (2,494) | |||||
| Balance at December 31 | $ | 32,494 | $ | 33,070 | $ | 33,693 | ||
| Retained earnings | ||||||||
| Balance at January 1 | $ | 144,055 | $ | 137,786 | $ | 131,137 | ||
| Net earnings attributable to the Company | 13,057 | 13,641 | 14,151 | |||||
| Dividends(a) | (8,060) | (7,372) | (7,498) | |||||
| Other | (1) | - | (4) | |||||
| Balance at December 31 | $ | 149,051 | $ | 144,055 | $ | 137,786 | ||
| Common stock held in treasury | ||||||||
| Balance at January 1 | $ | (34,571) | $ | (31,769) | $ | (31,938) | ||
| Purchases | (10,466) | (5,295) | (2,067) | |||||
| Dispositions | 2,476 | 2,493 | 2,236 | |||||
| Balance at December 31 | $ | (42,561) | $ | (34,571) | $ | (31,769) | ||
| Total equity | ||||||||
| GE shareowners' equity balance at December 31 | $ | 130,566 | $ | 123,026 | $ | 116,438 | ||
| Noncontrolling interests balance at December 31 | 6,217 | 5,444 | 1,696 | |||||
| Total equity balance at December 31 | $ | 136,783 | $ | 128,470 | $ | 118,134 | ||
(a) Included $1,031 million ($806 million related to our preferred stock redemption) of dividends on preferred stock in 2011.
Shares of GE Preferred Stock
On October 16, 2008, we issued 30,000 shares of 10% cumulative perpetual preferred stock (par value $1.00 per share) having an aggregate liquidation value of $3,000 million, and warrants to purchase 134,831,460 shares of common stock (par value $0.06 per share) to Berkshire Hathaway Inc. (Berkshire Hathaway) for net proceeds of $2,965 million in cash. The proceeds were allocated to the preferred shares ($2,494 million) and the warrants ($471 million) on a relative fair value basis and recorded in other capital. The warrants were exercisable through October 16, 2013, at an exercise price of $22.25 per share of common stock and were to be settled through physical share issuance. The terms of the warrants were amended in January 2013 to allow for net share settlement where the total number of issued shares is based on the amount by which the average market price of GE common stock over the 20 trading days preceding the date of exercise exceeds the exercise price of $22.25. On October 16, 2013, Berkshire Hathaway Inc. (Berkshire Hathaway) exercised in full their warrants to purchase shares of GE common stock and on October 17, 2013, GE delivered 10.7 million shares to Berkshire Hathaway. The transaction had equal and offsetting effects on other capital and common stock held in treasury.
The preferred stock was redeemable at our option three years after issuance at a price of 110% of liquidation value plus accrued and unpaid dividends. On September 13, 2011, we provided notice to Berkshire Hathaway that we would redeem the shares for the stated redemption price of $3,300 million, plus accrued and unpaid dividends. In connection with this notice, we recognized a preferred dividend of $806 million (calculated as the difference between the carrying value and redemption value of the preferred stock), which was recorded as a reduction to earnings attributable to common shareowners and common shareowners' equity. The preferred shares were redeemed on October 17, 2011.
GE has 50 million authorized shares of preferred stock ($1.00 par value). No shares were issued and outstanding as of December 31, 2013 and 2012.
Shares of GE Common Stock
On December 14, 2012, we increased the existing authorization by $10 billion to $25 billion for our share repurchase program and extended the program (which would have otherwise expired on December 31, 2013) through 2015. On February 12, 2013, we increased the existing authorization by an additional $10 billion resulting in authorization to repurchase up to a total of $35 billion of our common stock through 2015. Under this program, on a book basis, we repurchased 432.6 million shares for a total of $10,375 million during 2013 and 248.6 million shares for a total of $5,185 million during 2012.
GE has 13.2 billion authorized shares of common stock ($0.06 par value).
Common shares issued and outstanding are summarized in the following table.
| December 31 (In thousands) | 2013 | 2012 | 2011 | |||
| Issued | 11,693,841 | 11,693,841 | 11,693,841 | |||
| In treasury | (1,632,960) | (1,288,216) | (1,120,824) | |||
| Outstanding | 10,060,881 | 10,405,625 | 10,573,017 |
| Accumulated Other Comprehensive Income | ||||||||
| (In millions) | 2013 | 2012 | 2011 | |||||
| Investment securities | ||||||||
| Balance at January 1 | $ | 677 | $ | (30) | $ | (636) | ||
| OCI before reclassifications - net of deferred taxes of $(407), $387 and $341(a) | (692) | 683 | 577 | |||||
| Reclassifications from OCI - net of deferred taxes of $222, $13 and $1 | 318 | 22 | 31 | |||||
| Other comprehensive income(b) | (374) | 705 | 608 | |||||
| Less: OCI attributable to noncontrolling interests | (4) | (2) | 2 | |||||
| Balance at December 31 | $ | 307 | $ | 677 | $ | (30) | ||
| Currency translation adjustments (CTA) | ||||||||
| Balance at January 1 | $ | 412 | $ | 133 | $ | (86) | ||
| OCI before reclassifications - net of deferred taxes of $(613), $(266) and $(717) | 510 | 474 | (201) | |||||
| Reclassifications from OCI - net of deferred taxes of $793, $54 and $357 | (818) | (174) | 381 | |||||
| Other comprehensive income(b) | (308) | 300 | 180 | |||||
| Less: OCI attributable to noncontrolling interests | (22) | 21 | (39) | |||||
| Balance at December 31 | $ | 126 | $ | 412 | $ | 133 | ||
| Cash flow hedges | ||||||||
| Balance at January 1 | $ | (722) | $ | (1,176) | $ | (1,280) | ||
| OCI before reclassifications - net of deferred taxes of $250, $392 and $238 | 738 | 385 | (860) | |||||
| Reclassifications from OCI - net of deferred taxes of $(177), $(245) and $202 | (271) | 68 | 978 | |||||
| Other comprehensive income(b) | 467 | 453 | 118 | |||||
| Less: OCI attributable to noncontrolling interests | 2 | (1) | 14 | |||||
| Balance at December 31 | $ | (257) | $ | (722) | $ | (1,176) | ||
| Benefit plans | ||||||||
| Balance at January 1 | $ | (20,597) | $ | (22,901) | $ | (15,853) | ||
| Prior service credit (cost) - net of deferred taxes of $(5), $304 and $(276) | (6) | 534 | (495) | |||||
| Net actuarial gain (loss) - net of deferred taxes of $4,506, $(574) and $(4,746) | 8,269 | (1,396) | (8,637) | |||||
| Net curtailment/settlement - net of deferred taxes of $0, $123 and $0 | - | 174 | - | |||||
| Prior service cost amortization - net of deferred taxes of $267, $326 and $341 | 397 | 497 | 514 | |||||
| Net actuarial loss amortization - net of deferred taxes of $1,343, $1,278 and $811 | 2,640 | 2,490 | 1,578 | |||||
| Other comprehensive income(b) | 11,300 | 2,299 | (7,040) | |||||
| Less: OCI attributable to noncontrolling interests | (1) | (5) | 8 | |||||
| Balance at December 31 | $ | (9,296) | $ | (20,597) | $ | (22,901) | ||
| Accumulated other comprehensive income at December 31 | $ | (9,120) | $ | (20,230) | $ | (23,974) | ||
| Reclassification out of AOCI | ||||||||||
| Components of AOCI | 2013 | 2012 | 2011 | Statement of Earnings Caption | ||||||
| Available-for-sale securities | ||||||||||
| Realized gains (losses) on | ||||||||||
| sale/impairment of securities | $ | (540) | $ | (35) | $ | (32) | Other income | |||
| 222 | 13 | 1 | Tax (expense) or benefit | |||||||
| $ | (318) | $ | (22) | $ | (31) | Net of tax | ||||
| Currency translation adjustments | ||||||||||
| Gains (losses) on dispositions | $ | 25 | $ | 120 | $ | (738) | Costs and expenses | |||
| 793 | 54 | 357 | Tax (expense) or benefit | |||||||
| $ | 818 | $ | 174 | $ | (381) | Net of tax | ||||
| Cash flow hedges | ||||||||||
| Gains (losses) on interest rate derivatives | $ | (364) | $ | (499) | $ | (820) | Interest and other financial charges | |||
| Foreign exchange contracts | 564 | 792 | (510) | (a) | ||||||
| Other | 248 | (116) | 150 | (b) | ||||||
| 448 | 177 | (1,180) | Total before tax | |||||||
| (177) | (245) | 202 | Tax (expense) or benefit | |||||||
| $ | 271 | $ | (68) | $ | (978) | Net of tax | ||||
| Benefit plan items | ||||||||||
| Amortization of prior service costs | $ | (664) | $ | (823) | $ | (855) | (c) | |||
| Amortization of actuarial gains (losses) | (3,983) | (3,768) | (2,389) | (c) | ||||||
| (4,647) | (4,591) | (3,244) | Total before tax | |||||||
| 1,610 | 1,604 | 1,152 | Tax (expense) or benefit | |||||||
| $ | (3,037) | $ | (2,987) | $ | (2,092) | Net of tax | ||||
| Total reclassification adjustments | $ | (2,266) | $ | (2,903) | $ | (3,482) | Net of tax | |||
Noncontrolling Interests
Noncontrolling interests in equity of consolidated affiliates includes common shares in consolidated affiliates and preferred stock issued by GECC. The balance is summarized as follows.
| December 31 (In millions) | 2013 | 2012 | |||
| GECC preferred stock | $ | 4,950 | $ | 3,960 | |
| Other noncontrolling interests in consolidated affiliates(a) | 1,267 | 1,484 | |||
| Total | $ | 6,217 | $ | 5,444 | |
(a) Consisted of a number of individually insignificant noncontrolling interests in partnerships and consolidated affiliates.
Changes to noncontrolling interests are as follows.
| Years ended December 31 | ||||||||
| (In millions) | 2013 | 2012 | 2011 | |||||
| Beginning balance | $ | 5,444 | $ | 1,696 | $ | 5,262 | ||
| Net earnings | 298 | 223 | 292 | |||||
| GECC issuance of preferred stock | 990 | 3,960 | - | |||||
| GECC preferred stock dividend | (298) | (123) | - | |||||
| Repurchase of NBCU shares(a) | - | - | (3,070) | |||||
| Dispositions(b) | (175) | - | (609) | |||||
| Dividends | (80) | (42) | (34) | |||||
| Other (including AOCI)(c) | 38 | (270) | (145) | |||||
| Ending balance | $ | 6,217 | $ | 5,444 | $ | 1,696 | ||
(a) In January 2011 and prior to the transaction with Comcast, we acquired 12.3% of NBCU's outstanding shares from Vivendi for $3,673 million and made an additional payment of $222 million related to previously purchased shares. Of these amounts, $3,070 million reflects a reduction in carrying value of noncontrolling interests. The remaining amount of $825 million represents the amount paid in excess of our carrying value, which was recorded as an increase in our basis in NBCU.
(b) Includes noncontrolling interests related to the sale of GE SeaCo of $311 million and the redemption of Heller Financial preferred stock of $275 million in 2011.
(c) Primarily acquisitions and eliminations.
During the second quarter of 2013, GECC issued 10,000 shares of non-cumulative perpetual preferred stock with a $0.01 par value for proceeds of $990 million. The preferred shares bear an initial fixed interest rate of 5.25% through June 15, 2023, bear a floating rate equal to three-month LIBOR plus 2.967% thereafter and are callable on June 15, 2023. Dividends on the GECC preferred stock are payable semi-annually, in June and December, with the first payment on this issuance made in December 2013.
During 2012, GECC issued 40,000 shares of non-cumulative perpetual preferred stock with a $0.01 par value for proceeds of $3,960 million. Of these shares, 22,500 bear an initial fixed interest rate of 7.125% through June 15, 2022, bear a floating rate equal to three-month LIBOR plus 5.296% thereafter and are callable on June 15, 2022, and 17,500 shares bear an initial fixed interest rate of 6.25% through December 15, 2022, bear a floating rate equal to three-month LIBOR plus 4.704% thereafter and are callable on December 15, 2022. Dividends on the GECC preferred stock are payable semi-annually, in June and December, with the first payment on these issuances made in December 2012. GECC preferred stock is presented as noncontrolling interests in the GE consolidated statement of financial position.
During 2013 and 2012, GECC paid quarterly dividends of $1,930 million and $1,926 million, respectively, and special dividends of $4,055 million and $4,500 million, respectively, to GE. No dividends were paid during 2011.