through current cash balances and cash from operations.
Additionally, the Company has existing credit facilities totaling $2.5 billion.
The Company was in compliance with all its debt covenants at December 31, 2012.
The Company’s financial covenants require the maintenance of a minimum net worth of $9 billion and a total debt-tocapital ratio of less than 60%.
Net worth is defined as the sum of common stock, paid-in capital and retained earnings, less treasury stock plus any cumulative goodwill impairment charges.
The calculation also excludes accumulated other comprehensive income/loss and Nonrecourse Financial Liabilities of Special Purpose Entities.
The total debtto-capital ratio is defined as total debt divided by the sum of total debt plus net worth.
At December 31, 2012 , International Paper’s net worth was $13.9 billion, and the total-debt-to-capital ratio was 42%.
The Company will continue to rely upon debt and capital markets for the majority of any necessary long-term funding not provided by operating cash flows.
Funding decisions will be guided by our capital structure planning objectives.
The primary goals of the Company’s capital structure planning are to maximize financial flexibility and preserve liquidity while reducing interest expense.
The majority of International Paper’s debt is accessed through global public capital markets where we have a wide base of investors.
Maintaining an investment grade credit rating is an important element of International Paper’s financing strategy.
At December 31, 2012, the Company held long-term credit ratings of BBB (stable outlook) and Baa3 (stable outlook) by S&P and Moody’s, respectively.
Contractual obligations for future payments under existing debt and lease commitments and purchase obligations at December 31, 2012 , were as follows:
## Table 0 ##
(a) Total debt includes scheduled principal payments only.
(b) Represents debt obligations borrowed from non-consolidated variable interest entities for which International Paper has, and intends to effect, a legal right to offset these obligations with investments held in the entities.
Accordingly, in its consolidated balance sheet at December 31, 2012, International Paper has offset approximately $5.2 billion of interests in the entities against this $5.2 billion of debt obligations held by the entities (see Note 11 Variable Interest Entities and Preferred Securities of Subsidiaries on pages 69 through 72 in Item 8.
Financial Statements and Supplementary Data).
(c) Includes $3.6 billion relating to fiber supply agreements entered into at the time of the 2006 Transformation Plan forestland sales and in conjunction with the 2008 acquisition of Weyerhaeuser Company’s Containerboard, Packaging and Recycling business.
(d) Not included in the above table due to the uncertainty as to the amount and timing of the payment are unrecognized tax benefits of approximately $620 million.
We consider the undistributed earnings of our foreign subsidiaries as of December 31, 2012, to be indefinitely reinvested and, accordingly, no U. S.  income taxes have been provided thereon.
As of December 31, 2012 , the amount of cash associated with indefinitely reinvested foreign earnings was approximately $840 million.
We do not anticipate the need to repatriate funds to the United States to satisfy domestic liquidity needs arising in the ordinary course of business, including liquidity needs associated with our domestic debt service requirements.
Pension Obligations and Funding At December 31, 2012, the projected benefit obligation for the Company’s U. S.  defined benefit plans determined under U. S.  GAAP was approximately $4.1 billion higher than the fair value of plan assets.
Approximately $3.7 billion of this amount relates to plans that are subject to minimum funding requirements.
Under current IRS funding rules, the calculation of minimum funding requirements differs from the calculation of the present value of plan benefits(the projected benefit obligation) for accounting purposes.
In December 2008, the Worker, Retiree and Employer Recovery Act of 2008 (WERA) was passed by the U. S.  Congress which provided for pension funding relief and technical corrections.
Funding contributions depend on the funding method selected by the Company, and the timing of its implementation, as well as on actual demographic data and the targeted funding level.
The Company continually reassesses the amount and timing of any discretionary contributions and elected to make voluntary contributions totaling $44 million and $300 million for the years ended December 31, 2012 and 2011, respectively.
At this time, we expect that required contributions to its plans in 2013 will be approximately $31 million, although the Company may elect to make future voluntary contributions.
The timing and amount of future contributions, which could be material, will depend on a number of factors, including the actual earnings and changes in values of plan assets and changes in interest rates.
Ilim Holding S. A.  Shareholder’s Agreement In October 2007, in connection with the formation of the Ilim Holding S. A.  joint venture, International Paper entered into a shareholder’s agreement that includes provisions relating to the reconciliation of disputes among the partners.
This agreement provides that at
Notes to consolidated financial statements JPMorgan Chase & Co.  116 JPMorgan Chase & Co.  / 2004 Annual Report On October 22, 2004, the American Jobs Creation Act of 2004 (the “Act”) was signed into law.
The Act creates a temporary incentive for U. S.  companies to repatriate accumulated foreign earnings at a substantially reduced U. S.  effective tax rate by providing a dividends received deduction on the repatriation of certain foreign earnings to the U. S.  taxpayer (the “repatriation provision”).
The new deduction is subject to a number of limitations and requirements and is effective for either the 2004 or 2005 tax years for calendar year taxpayers.
The range of possible amounts that may be considered for repatriation under this provision is between zero and $1.9 billion.
The Firm is currently assessing the impact of the repatriation provision and, at this time, cannot reasonably estimate the related range of income tax effects of such repatriation provision.
Accordingly, the Firm has not reflected the tax effect of the repatriation provision in income tax expense or income tax liabilities.
The tax expense applicable to securities gains and losses for the years 2004, 2003 and 2002 was $126 million, $477 million and $531 million, respectively.
A reconciliation of the applicable statutory U. S.  income tax rate to the effective tax rate for the past three years is shown in the following table:
## Table 1 ##
(a) 2004 results include six months of the combined Firm’s results and six months of heritage JPMorgan Chase results.
All other periods reflect the results of heritage JPMorgan Chase only.
(b) The decrease in 2004 is attributable to changes in the proportion of income subject to different state and local taxes.
The following table presents the U. S.  and non-U.
S.  components of income before income tax expense:
## Table 2 ##
(a) 2004 results include six months of the combined Firm’s results and six months of heritage JPMorgan Chase results.
All other periods reflect the results of heritage JPMorgan Chase only.
(b) For purposes of this table, non-U.
S.  income is defined as income generated from operations located outside the United States.
Note 23 – Restrictions on cash and intercompany funds transfers The Federal Reserve Board requires depository institutions to maintain cash reserves with a Federal Reserve Bank.
The average amount of reserve balances deposited by the Firm’s bank subsidiaries with various Federal Reserve Banks was approximately $3.8 billion in 2004 and $2.6 billion in 2003.
Restrictions imposed by federal law prohibit JPMorgan Chase and certain other affiliates from borrowing from banking subsidiaries unless the loans are secured in specified amounts.
Such secured loans to the Firm or to other affiliates are generally limited to 10% of the banking subsidiary’s total capital, as determined by the risk-based capital guidelines; the aggregate amount of all such loans is limited to 20% of the banking subsidiary’s total capital.
The principal sources of JPMorgan Chase’s income (on a parent companyonly basis) are dividends and interest from JPMorgan Chase Bank and the other banking and nonbanking subsidiaries of JPMorgan Chase.
In addition to dividend restrictions set forth in statutes and regulations, the FRB, the Office of the Comptroller of the Currency (“OCC”) and the Federal Deposit Insurance Corporation (“FDIC”) have authority under the Financial Institutions Supervisory Act to prohibit or to limit the payment of dividends by the banking organizations they supervise, including JPMorgan Chase and its subsidiaries that are banks or bank holding companies, if, in the banking regulator’s opinion, payment of a dividend would constitute an unsafe or unsound practice in light of the financial condition of the banking organization.
At January 1, 2005 and 2004, JPMorgan Chase’s bank subsidiaries could pay, in the aggregate, $6.2 billion and $4.4 billion, respectively, in dividends to their respective bank holding companies without prior approval of their relevant banking regulators.
Dividend capacity in 2005 will be supplemented by the banks’ earnings during the year.
In compliance with rules and regulations established by U. S.  and non-U.
S.  regulators, as of December 31, 2004 and 2003, cash in the amount of $4.3 billion and $3.5 billion, respectively, and securities with a fair value of $3.6 billion and $3.1 billion, respectively, were segregated in special bank accounts for the benefit of securities and futures brokerage customers.
Note 24 – Capital There are two categories of risk-based capital: Tier 1 capital and Tier 2 capital.
Tier 1 capital includes common stockholders’ equity, qualifying preferred stock and minority interest less goodwill and other adjustments.
Tier 2 capital consists of preferred stock not qualifying as Tier 1, subordinated long-term debt and other instruments qualifying as Tier 2, and the aggregate allowance for credit losses up to a certain percentage of risk-weighted assets.
Total regulatory capital is subject to deductions for investments in certain subsidiaries.
Under the risk-based capital guidelines of the FRB, JPMorgan Chase is required to maintain minimum ratios of Tier 1 and total (Tier 1 plus Tier 2) capital to risk-weighted assets, as well as minimum leverage ratios (which are defined as Tier 1 capital to average adjusted on–balance sheet assets).
Failure to meet these minimum requirements could cause the FRB to take action.
Bank subsidiaries also are subject to these capital requirements by their respective primary regulators.
As of December 31, 2004 and 2003, JPMorgan Chase and its primary banking subsidiaries met all capital requirements to which each was subject.
Defined benefit pension plan
## Table 3 ##
(a) Effective July 1, 2004, the Firm assumed the obligations of heritage Bank One’s pension and other postretirement plans.
These plans were similar to those of JPMorgan Chase and were merged into the Firm’s plans effective December 31, 2004.
(b) Heritage JPMorgan Chase only.
(c) The effect of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 resulted in a $35 million reduction in the Accumulated other postretirement benefit obligation.
(d) Includes postretirement benefit obligation of $43 million and $36 million and postretirement benefit liability (included in Accrued expenses) of $57 million and $54 million at December 31, 2004 and 2003, respectively, for the UK plan, which is unfunded.
(e) At December 31, 2004 and 2003, approximately $358 million and $315 million, respectively, of U. S.  plan assets relate to surplus assets of group annuity contracts.
(f) At December 31,2004 and 2003, Accrued expenses related to non-U.
S. defined benefit pension plans that JPMorgan Chase elected not to pre-fund fully totaled $124 million and $99 million,respectively
## Table 4 ##
(a) 2004 results include six months of the combined Firm’s results and six months of heritage JPMorgan Chase results.
All other periods reflect the results of heritage JPMorgan Chase only.
(b) The effect of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 resulted in a $5 million reduction in the Firm’s net periodic benefit cos
The following table presents the amortized cost, estimated fair value and average yield at December 31, 2005, of JPMorgan Chase’s AFS and HTM securities by contractual maturity:
## Table 5 ##
(a) The average yield is based upon amortized cost balances at year-end.
Yields are derived by dividing interest income by total amortized cost.
Taxable-equivalent yields are used where applicable.
(b) Includes securities with no stated maturity.
Substantially all of JPMorgan Chase’s MBSs and CMOs are due in 10 years or more based upon contractual maturity.
The estimated duration, which reflects anticipated future prepayments based upon a consensus of dealers in the market, is approximately four years for MBSs and CMOs.
Private equity investments are primarily held by the Private Equity business within Corporate (which includes JPMorgan Partners and ONE Equity Partners businesses).
The Private Equity business invests in buyouts, growth equity and venture opportunities in the normal course of business.
These investments are accounted for under investment company guidelines.
Accordingly, these investments, irrespective of the percentage of equity ownership interest held by Private Equity, are carried on the Consolidated balance sheets at fair value.
Realized and unrealized gains and losses arising from changes in value are reported in Securities/private equity gains in the Consolidated statements of income in the period that the gains or losses occur.
Privately-held investments are initially valued based upon cost.
The carrying values of privately-held investments are adjusted from cost to reflect both positive and negative changes evidenced by financing events with third-party capital providers.
In addition, these investments are subject to ongoing impairment reviews by Private Equity’s senior investment professionals.
A variety of factors are reviewed and monitored to assess impairment including, but not limited to, operating performance and future expectations of the particular portfolio investment, industry valuations of comparable public companies, changes in market outlook and the third-party financing environment over time.
The Valuation Control Group within the Finance area is responsible for reviewing the accuracy of the carrying values of private investments held by Private Equity.
Private Equity also holds publicly-held equity investments, generally obtained through the initial public offering of privately-held equity investments.
Publiclyheld investments are marked to market at the quoted public value.
To determine the carrying values of these investments, Private Equity incorporates the use of discounts to take into account the fact that it cannot immediately realize or risk-manage the quoted public values as a result of regulatory and/or contractual sales restrictions imposed on these holdings.
The following table presents the carrying value and cost of the Private Equity investment portfolio for the dates indicated:
## Table 6 ##
Note 10 – Securities financing activities JPMorgan Chase enters into resale agreements, repurchase agreements, securities borrowed transactions and securities loaned transactions primarily to finance the Firm’s inventory positions, acquire securities to cover short positions and settle other securities obligations.
The Firm also enters into these transactions to accommodate customers’ needs.
Securities purchased under resale agreements (“resale agreements”) and securities sold under repurchase agreements (“repurchase agreements”) are generally treated as collateralized financing transactions and are carried on the Consolidated balance sheets at the amounts the securities will be subsequently sold or repurchased, plus accrued interest.
Where appropriate, resale and repurchase agreements with the same counterparty are reported on a net basis in accordance with FIN 41.
JPMorgan Chase takes possession of securities purchased under resale agreements.
On a daily basis, JPMorgan Chase monitors the market value of the underlying collateral received from its counterparties, consisting primarily of U. S.  and non-U.
S.  government and agency securities, and requests additional collateral from its counterparties when necessary.
Transactions similar to financing activities that do not meet the SFAS 140 definition of a repurchase agreement are accounted for as “buys” and “sells” rather than financing transactions.
These transactions are accounted for as a purchase (sale) of the underlying securities with a forward obligation to sell (purchase) the securities.
The forward purchase (sale) obligation, a derivative, is recorded on the Consolidated balance sheets at its fair value, with changes in fair value recorded in Trading revenue.
Securities borrowed and securities lent are recorded at the amount of cash collateral advanced or received.
Securities borrowed consist primarily of government and equity securities.
JPMorgan Chase monitors the market value of the securities borrowed and lent on a daily basis and calls for additional collateral when appropriate.
Fees received or paid are recorded in Interest income or Interest expense.
The increase in noninvestment grade derivative receivables reflects a weakening credit environment.
The Firm actively pursues the use of collateral agreements to mitigate counterparty credit risk in derivatives.
The percentage of the Firm’s derivatives transactions subject to collateral agreements was 83% as of December 31, 2008, largely unchanged from 82% at December 31, 2007.
The Firm posted $99.1 billion and $33.5 billion of collateral at December 31, 2008 and 2007, respectively.
Certain derivative and collateral agreements include provisions that require the counterparty and/or the Firm, upon specified downgrades in their respective credit ratings, to post collateral for the benefit of the other party.
The impact of a single-notch ratings downgrade to JPMorgan Chase Bank, N. A. , from its rating of “AA-” to “A+” at December 31, 2008, would have required $2.2 billion of additional collateral to be posted by the Firm.
The impact of a six-notch ratings downgrade (from “AA-” to “BBB-”) would have required $6.4 billion of additional collateral.
Certain derivative contracts also provide for termination of the contract, generally upon a downgrade of either the Firm or the counterparty, at the then-existing MTM value of the derivative contracts.
Credit derivatives Credit derivatives are financial contracts that isolate credit risk from an underlying instrument (such as a loan or security) and transfer that risk from one party (the buyer of credit protection) to another (the seller of credit protection).
The Firm is both a purchaser and seller of credit protection.
As a purchaser of credit protection, the Firm has risk that the counterparty providing the credit protection will default.
As a seller of credit protection, the Firm has risk that the underlying instrument referenced in the contract will be subject to a credit event.
Of the Firm’s $162.6 billion of total derivative receivables MTM at December 31, 2008, $44.7 billion, or 27%, was associated with credit derivatives, before the benefit of liquid securities collateral.
One type of credit derivatives the Firm enters into with counterparties are credit default swaps (“CDS”).
For further detailed discussion of these and other types of credit derivatives, see Note 32 on pages 214–217 of this Annual Report.
The large majority of CDS are subject to collateral arrangements to protect the Firm from counterparty credit risk.
In 2008, the frequency and size of defaults for both trading counterparties and the underlying debt referenced in credit derivatives were well above historical norms.
The use of collateral to settle against defaulting counterparties generally performed as designed in significantly mitigating the Firm’s exposure to these counterparties.
During 2008, the Firm worked with other significant market participants to develop mechanisms to reduce counterparty credit risk, including the cancellation of offsetting trades.
In 2009, it is anticipated that one or more central counterparties for CDS will be established and JPMorgan Chase will face these central counterparties, or clearing houses, for an increasing portion of its CDS business.
The Firm uses credit derivatives for two primary purposes: first, in its capacity as a market-maker in the dealer/client business to meet the needs of customers; and second, in order to mitigate the Firm’s own credit risk associated with its overall derivative receivables and traditional commercial credit lending exposures (loans and unfunded commitments), as well as its exposure to residential and commercial mortgages.
The following table presents the Firm’s notional amounts of credit derivatives protection purchased and sold as of December 31, 2008 and 2007, distinguishing between dealer/client activity and credit portfolio activity.

<table><tr><td>In millions</td><td>2013</td><td>2014</td><td>2015</td><td>2016</td><td>2017</td><td>Thereafter</td></tr><tr><td>Maturities of long-term debt (a)</td><td>$444</td><td>$708</td><td>$479</td><td>$571</td><td>$216</td><td>$7,722</td></tr><tr><td>Debt obligations with right of offset (b)</td><td>—</td><td>—</td><td>—</td><td>5,173</td><td>—</td><td>—</td></tr><tr><td>Lease obligations</td><td>198</td><td>136</td><td>106</td><td>70</td><td>50</td><td>141</td></tr><tr><td>Purchase obligations (c)</td><td>3,213</td><td>828</td><td>722</td><td>620</td><td>808</td><td>2,654</td></tr><tr><td>Total (d)</td><td>$3,855</td><td>$1,672</td><td>$1,307</td><td>$6,434</td><td>$1,074</td><td>$10,517</td></tr></table>
<table><tr><td>Year ended December 31,<sup>(a)</sup></td><td>2004</td><td>2003</td><td>2002</td></tr><tr><td>Statutory U.S. federal tax rate</td><td>35.0%</td><td>35.0%</td><td>35.0%</td></tr><tr><td>Increase (decrease) in tax rate resulting from:</td><td></td><td></td><td></td></tr><tr><td>U.S. state and local income taxes, net offederal income tax benefit</td><td>0.6(b)</td><td>2.1</td><td>11.6</td></tr><tr><td>Tax-exempt income</td><td>-4.1</td><td>-2.4</td><td>-6.2</td></tr><tr><td>Non-U.S. subsidiary earnings</td><td>-1.3</td><td>-0.7</td><td>-2.2</td></tr><tr><td>Business tax credits</td><td>-4.1</td><td>-0.9</td><td>-3.5</td></tr><tr><td>Other, net</td><td>1.8</td><td>-0.1</td><td>-0.7</td></tr><tr><td>Effective tax rate</td><td>27.9%</td><td>33.0%</td><td>34.0%</td></tr></table>
<table><tr><td>Year ended December 31, (in millions)<sup>(a)</sup></td><td> 2004</td><td>2003</td><td>2002</td></tr><tr><td>U.S.</td><td>$3,817</td><td>$7,333</td><td>$1,834</td></tr><tr><td>Non-U.S.<sup>(b)</sup></td><td>2,377</td><td>2,695</td><td>685</td></tr><tr><td>Income before income tax expense</td><td>$6,194</td><td>$10,028</td><td>$2,519</td></tr></table>
<table><tr><td></td><td colspan="4">Defined benefit pension plans</td><td colspan="2"></td></tr><tr><td></td><td colspan="2">U.S.</td><td colspan="2">Non-U.S.</td><td colspan="2">Postretirement benefit plans (d)</td></tr><tr><td>December 31, (in millions)</td><td>2004(a)</td><td>2003(b)</td><td>2004(a)</td><td>2003(b)</td><td>2004(a)(c)</td><td>2003(b)</td></tr><tr><td> Change in benefit obligation</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Benefit obligation at beginning of year</td><td>$-4,633</td><td>$-4,241</td><td>$-1,659</td><td>$-1,329</td><td>$-1,252</td><td>$-1,126</td></tr><tr><td>Merger with Bank One</td><td>-2,497</td><td>NA</td><td>-25</td><td>NA</td><td>-216</td><td>NA</td></tr><tr><td>Benefits earned during the year</td><td>-251</td><td>-180</td><td>-17</td><td>-16</td><td>-15</td><td>-15</td></tr><tr><td>Interest cost on benefit obligations</td><td>-348</td><td>-262</td><td>-87</td><td>-74</td><td>-81</td><td>-73</td></tr><tr><td>Plan amendments</td><td>70</td><td>-89</td><td>—</td><td>-1</td><td>32</td><td>—</td></tr><tr><td>Employee contributions</td><td>—</td><td>—</td><td>—</td><td>-1</td><td>-36</td><td>-11</td></tr><tr><td>Actuarial gain (loss)</td><td>-511</td><td>-262</td><td>-99</td><td>-125</td><td>-163</td><td>-134</td></tr><tr><td>Benefits paid</td><td>555</td><td>386</td><td>64</td><td>55</td><td>167</td><td>113</td></tr><tr><td>Curtailments</td><td>21</td><td>15</td><td>—</td><td>—</td><td>-8</td><td>-2</td></tr><tr><td>Special termination benefits</td><td>—</td><td>—</td><td>-12</td><td>-1</td><td>-2</td><td>—</td></tr><tr><td>Foreign exchange impact and other</td><td>—</td><td>—</td><td>-134</td><td>-167</td><td>-3</td><td>-4</td></tr><tr><td>Benefit obligation at end of year</td><td>$-7,594</td><td>$-4,633</td><td>$-1,969</td><td>$-1,659</td><td>$-1,577</td><td>$-1,252</td></tr><tr><td> Change in plan assets</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Fair value of plan assets at beginning of year</td><td>$4,866</td><td>$4,114</td><td>$1,603</td><td>$1,281</td><td>$1,149</td><td>$1,020</td></tr><tr><td>Merger with Bank One</td><td>3,280</td><td>NA</td><td>20</td><td>NA</td><td>98</td><td>NA</td></tr><tr><td>Actual return on plan assets</td><td>946</td><td>811</td><td>164</td><td>133</td><td>84</td><td>154</td></tr><tr><td>Firm contributions</td><td>1,100</td><td>327</td><td>40</td><td>87</td><td>2</td><td>2</td></tr><tr><td>Benefits paid</td><td>-555</td><td>-386</td><td>-64</td><td>-43</td><td>-31</td><td>-27</td></tr><tr><td>Settlement payments</td><td>—</td><td>—</td><td>—</td><td>-12</td><td>—</td><td>—</td></tr><tr><td>Foreign exchange impact and other</td><td>—</td><td>—</td><td>126</td><td>157</td><td>—</td><td>—</td></tr><tr><td>Fair value of plan assets at end of year</td><td>$9,637(e)</td><td>$4,866(e)</td><td>$1,889</td><td>$1,603</td><td>$1,302</td><td>$1,149</td></tr><tr><td> Reconciliation of funded status</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Funded status</td><td>$2,043</td><td>$233</td><td>$-80</td><td>$-56</td><td>$-275</td><td>$-103</td></tr><tr><td>Unrecognized amounts:</td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Net transition asset</td><td>—</td><td>—</td><td>-1</td><td>-1</td><td>—</td><td>—</td></tr><tr><td>Prior service cost</td><td>47</td><td>137</td><td>4</td><td>5</td><td>-23</td><td>8</td></tr><tr><td>Net actuarial (gain) loss</td><td>997</td><td>920</td><td>590</td><td>564</td><td>321</td><td>156</td></tr><tr><td> Prepaid benefit cost reported in Other assets</td><td>$3,087</td><td>$1,290</td><td>$513(f)</td><td>$512(f)</td><td>$23</td><td>$61</td></tr><tr><td> Accumulated benefit obligation</td><td>$-7,167</td><td>$-4,312</td><td>$-1,931</td><td>$-1,626</td><td>NA</td><td>NA</td></tr></table>
<table><tr><td></td><td colspan="6">Defined benefit pension plans</td><td colspan="3"></td></tr><tr><td></td><td colspan="3">U.S.</td><td colspan="3">Non-U.S.</td><td colspan="3">Postretirement benefit plans</td></tr><tr><td>For the year ended December 31, (in millions)<sup>(a)</sup></td><td>2004</td><td>2003</td><td>2002</td><td>2004</td><td>2003</td><td>2002</td><td>2004</td><td>2003</td><td>2002</td></tr><tr><td> Components of net periodic benefit costs</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Benefits earned during the period</td><td>$251</td><td>$180</td><td>$174</td><td>$17</td><td>$16</td><td>$16</td><td>$15</td><td>$15</td><td>$12</td></tr><tr><td>Interest cost on benefit obligations</td><td>348</td><td>262</td><td>275</td><td>87</td><td>74</td><td>62</td><td>81</td><td>73</td><td>69</td></tr><tr><td>Expected return on plan assets</td><td>-556</td><td>-322</td><td>-358</td><td>-90</td><td>-83</td><td>-76</td><td>-86</td><td>-92</td><td>-98</td></tr><tr><td>Amortization of unrecognized amounts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Prior service cost</td><td>13</td><td>6</td><td>7</td><td>1</td><td>—</td><td>—</td><td>—</td><td>1</td><td>2</td></tr><tr><td>Net actuarial (gain) loss</td><td>23</td><td>62</td><td>—</td><td>44</td><td>35</td><td>6</td><td>—</td><td>—</td><td>-10</td></tr><tr><td>Curtailment (gain) loss</td><td>7</td><td>2</td><td>15</td><td>—</td><td>8</td><td>-3</td><td>8</td><td>2</td><td>-8</td></tr><tr><td>Settlement (gain) loss</td><td>—</td><td>—</td><td>—</td><td>-1</td><td>—</td><td>-2</td><td>—</td><td>—</td><td>—</td></tr><tr><td>Special termination benefits</td><td>—</td><td>—</td><td>—</td><td>11</td><td>—</td><td>3</td><td>2</td><td>—</td><td>57</td></tr><tr><td>Net periodic benefit costs reported inCompensation expense</td><td>$86</td><td>$190</td><td>$113</td><td>$69</td><td>$50</td><td>$6</td><td>$20(b)</td><td>$-1</td><td>$24</td></tr></table>
<table><tr><td></td><td colspan="3">Available-for-sale securities</td><td colspan="3">Held-to-maturity securities</td><td></td></tr><tr><td>Maturity schedule of securities</td><td rowspan="2">Amortized cost</td><td rowspan="2">Fair value</td><td rowspan="2">Average yield(a)</td><td rowspan="2">Amortized cost</td><td rowspan="2">Fair value</td><td rowspan="2">Average yield</td><td></td></tr><tr><td>December 31, 2005 (in millions)</td><td><sup>(a)</sup></td></tr><tr><td>Due in one year or less</td><td>$6,723</td><td>$6,426</td><td>2.77%</td><td>$—</td><td>$—</td><td> —</td><td> %</td></tr><tr><td>Due after one year through five years</td><td>7,740</td><td>8,009</td><td>3.72</td><td>—</td><td>—</td><td> —</td><td></td></tr><tr><td>Due after five years through 10 years</td><td>5,346</td><td>5,366</td><td>4.70</td><td>30</td><td>31</td><td> 6.96</td><td></td></tr><tr><td>Due after 10 years<sup>(b)</sup></td><td>28,184</td><td>27,722</td><td>4.69</td><td>47</td><td>49</td><td> 6.73</td><td></td></tr><tr><td>Total securities</td><td>$47,993</td><td>$47,523</td><td>4.27%</td><td>$77</td><td>$80</td><td> 6.82</td><td> %</td></tr></table>
<table><tr><td></td><td colspan="2"> 2005</td><td colspan="2">2004</td></tr><tr><td>December 31, (in millions)</td><td>Carrying value</td><td>Cost</td><td>Carrying value</td><td>Cost</td></tr><tr><td>Total private equity investments</td><td>$6,374</td><td>$8,036</td><td>$7,735</td><td>$9,103</td></tr></table>

Question: In what year is Net periodic benefit costs reported in Compensation expense under Defined benefit pension plans for Non-U.S. the most?
Answer: 2004