Management’s discussion and analysis 164 JPMorgan Chase & Co. /2013 Annual Report Firm) is required to hold more than the additional 2.5% of Tier 1 common.
In addition, Basel III establishes a 6.5% Tier I common equity standard for the definition of “well capitalized” under the Prompt Corrective Action (“PCA”) requirements of the FDIC Improvement Act (“FDICIA”).
The Tier I common equity standard is effective from the first quarter of 2015.
The following chart presents the Basel III minimum risk-based capital ratios during the transitional periods and on a fully phased-in basis.
The chart also includes management’s target for the Firm’s Tier 1 common ratio.
It is the Firm’s current expectation that its Basel III Tier 1 common ratio will exceed the regulatory minimums, both during the transition period and upon full implementation in 2019 and thereafter.
The Firm estimates that its Tier 1 common ratio under the Basel III Advanced Approach on a fully phased-in basis would be 9.5% as of December 31, 2013, achieving management’s previously stated objectives.
The Tier 1 common ratio as calculated under the Basel III Standardized Approach is estimated at 9.4% as of December 31, 2013.
The Tier 1 common ratio under both Basel I and Basel III are non-GAAP financial measures.
However, such measures are used by bank regulators, investors and analysts to assess the Firm’s capital position and to compare the Firm’s capital to that of other financial services companies.
## Table 0 ##
The following table presents a comparison of the Firm’s Tier 1 common under Basel I rules to its estimated Tier 1 common under the Advanced Approach of the Basel III rules, along with the Firm’s estimated risk-weighted assets.
Key differences in the calculation of RWA between Basel I and Basel III Advanced Approach include: (1) Basel III credit risk RWA is based on risk-sensitive approaches which largely rely on the use of internal credit models and parameters, whereas Basel I RWA is based on fixed supervisory risk- weightings which vary only by counterparty type and asset class; and (2) Basel III includes RWA for operational risk, whereas Basel I does not.
Operational risk capital takes into consideration operational losses in the quarter following the period in which those losses were realized, and the calculation generally incorporates such losses irrespective of whether the issues or business activity giving rise to the losses have been remediated or reduced.
The Firm’soperational risk capital model continues to be refined in conjunction with the Firm’s Basel III Advanced Approach parallel run.
As a result of model enhancements in 2013, as well as taking into consideration the legal expenses incurred by the Firm in 2013, the Firm’s operational risk capital increased substantially in 2013 over 2012.
Tier 1 common under Basel III includes additional adjustments and deductions not included in Basel I Tier 1 common, such as the inclusion of accumulated other comprehensive income (“AOCI”) related to AFS securities and defined benefit pension and other postretirement employee benefit (“OPEB”) plans.
Notes to consolidated financial statements 226 JPMorgan Chase & Co. /2013 Annual Report The following table presents, as of December 31, 2013 and 2012, the gross and net derivative payables by contract and settlement type.
Derivative payables have been netted on the Consolidated Balance Sheets against derivative receivables to the same counterparty with respect to derivative contracts for which the Firm has obtained an appropriate legal opinion with respect to the master netting agreement.
Where such a legal opinion has not been either sought or obtained, the payables are not eligible under U. S.  GAAP for netting against related derivative receivables on the Consolidated Balance Sheets, and are shown separately in the table below.
## Table 1 ##
(a) The prior period amounts have been revised.
This revision had no impact on the Firm’s Consolidated Balance Sheets or its results of operations.
(b) Exchange traded derivative balances that relate to futures contracts are settled daily.
(c) Included netted cash collateral receivables of $52.1 billion and $60.7 billion related to OTC and OTC-cleared derivatives at December 31, 2013, and December 31, 2012, respectively.
to 2008 (“FHFA Settlement Agreement”).
The majority of the mortgage repurchase demands that the Firm had received from the GSEs related to loans originated from 2005 to 2008.
The Firm has recognized a mortgage repurchase liability of $681 million and $2.8 billion as of December 31, 2013 and 2012, respectively.
The amount of the mortgage repurchase liability at December 31, 2013, relates to repurchase losses associated with loans sold in connection with loan sale and securitization transactions with the GSEs that are not covered by the FHFA Settlement Agreement (e. g. , post-2008 loan sale and securitization transactions, mortgage insurance rescissions and certain mortgage insurance settlement-related exposures, as well as certain other specific exclusions).
At December 31, 2013, the Firm had outstanding repurchase demands of $330 million and unresolved mortgage insurance rescission notices of $263 million (excluding mortgage insurance rescission notices on loans for which a repurchase demand also has been received).
The following table summarizes the change in the mortgage repurchase liability for each of the periods presented.
Summary of changes in mortgage repurchase liability
## Table 2 ##
(a) Presented net of third-party recoveries and includes principal losses and accrued interest on repurchased loans, “make-whole” settlements, settlements with claimants, and certain related expense.
Make-whole settlements were $414 million, $524 million and $640 million, for the years ended December 31, 2013, 2012 and 2011, respectively.
(b) The 2013 amount includes $1.1 billion for the FHFA Settlement Agreement.
(c) Prior to December 31, 2013, in the absence of a repurchase demand by a party to the relevant contracts, the Firm’s decision to repurchase loans from private-label securitization trusts when it determined it had an obligation to do so was recognized in the mortgage repurchase liability.
Pursuant to the terms of the RMBS Trust Settlement, all repurchase obligations relating to the subject private-label securitization trusts, whether resulting from a repurchase demand or otherwise, are now recognized in the Firm’s litigation reserves for this settlement.
The RMBS Trust Settlement is fully accrued as of December 31, 2013.
(d) Included a provision related to new loan sales of $20 million, $112 million and $52 million, for the years ended December 31, 2013, 2012 and 2011, respectively.
Private label securitizations The liability related to repurchase demands associated with private label securitizations is separately evaluated by the Firm in establishing its litigation reserves.
On November 15, 2013, the Firm announced it had reached a $4.5 billion agreement with 21 major institutional investors to make a binding offer to the trustees of 330 residential mortgage-backed securities trusts issued by J. P. Morgan, Chase and Bear Stearns (“RMBS Trust Settlement”) to resolve all representation and warranty claims, as well as all servicing claims, on all trusts issued by J. P. Morgan, Chase and Bear Stearns between 2005 and 2008.
The RMBS Trust Settlement may be subject to court approval.
For further information about the RMBS Trust Settlement, see Note 31 on pages 326–332 of this Annual Report.
In addition, from 2005 to 2008, Washington Mutual made certain loan level representations and warranties in connection with approximately $165 billion of residential mortgage loans that were originally sold or deposited into private-label securitizations by Washington Mutual.
Of the $165 billion, approximately $75 billion has been repaid.
In addition, approximately $47 billion of the principal amount of such loans has liquidated with an average loss severity of 59%.
Accordingly, the remaining outstanding principal balance of these loans as of December 31, 2013, was approximately $43 billion, of which $10 billion was 60 days or more past due.
The Firm believes that any repurchase obligations related to these loans remain with the FDIC receivership.
For additional information regarding the mortgage repurchase liability, see Note 29 on pages 318–324 of this Annual Report.

<table><tr><td>Tier 1 common under Basel I rules</td><td>$148,887</td></tr><tr><td>Adjustments related to AOCI for AFS securities and defined benefit pension and OPEB plans</td><td>1,474</td></tr><tr><td>Add back of Basel I deductions<sup>(a)</sup></td><td>1,780</td></tr><tr><td>Deduction for deferred tax asset related to net operating loss and foreign tax credit carryforwards</td><td>-741</td></tr><tr><td>All other adjustments</td><td>-198</td></tr><tr><td>Estimated Tier 1 common under Basel III rules</td><td>$151,202</td></tr><tr><td>Estimated risk-weighted assets under Basel III Advanced Approach<sup>(b)</sup></td><td>$1,590,873</td></tr><tr><td>Estimated Tier 1 common ratio under Basel III Advanced Approach<sup>(c)</sup></td><td>9.5%</td></tr></table>
<table><tr><td></td><td colspan="4">2013</td><td colspan="4">2012</td></tr><tr><td>December 31, (in millions)</td><td>Gross derivative payables</td><td colspan="2">Amounts netted on the Consolidated balance sheets</td><td>Net derivative payables</td><td>Gross derivative payables</td><td colspan="2">Amounts netted on the Consolidated balance sheets</td><td>Net derivative payables</td></tr><tr><td>U.S. GAAP nettable derivative payables</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Interest rate contracts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>OTC<sup>(a)</sup></td><td>$467,850</td><td>$-458,081</td><td></td><td>$9,769</td><td>$774,824</td><td>$-754,105</td><td></td><td>$20,719</td></tr><tr><td>OTC–cleared</td><td>354,698</td><td>-353,990</td><td></td><td>708</td><td>482,018</td><td>-481,763</td><td></td><td>255</td></tr><tr><td>Exchange traded<sup>(b)</sup></td><td>—</td><td>—</td><td></td><td>—</td><td>—</td><td>—</td><td></td><td>—</td></tr><tr><td>Total interest rate contracts</td><td>822,548</td><td>-812,071</td><td></td><td>10,477</td><td>1,256,842</td><td>-1,235,868</td><td></td><td>20,974</td></tr><tr><td>Credit contracts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>OTC</td><td>65,223</td><td>-63,671</td><td></td><td>1,552</td><td>89,170</td><td>-88,151</td><td></td><td>1,019</td></tr><tr><td>OTC–cleared</td><td>16,506</td><td>-16,450</td><td></td><td>56</td><td>9,372</td><td>-9,372</td><td></td><td>—</td></tr><tr><td>Total credit contracts</td><td>81,729</td><td>-80,121</td><td></td><td>1,608</td><td>98,542</td><td>-97,523</td><td></td><td>1,019</td></tr><tr><td>Foreign exchange contracts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>OTC<sup>(a)</sup></td><td>155,110</td><td>-144,119</td><td></td><td>10,991</td><td>153,181</td><td>-141,928</td><td></td><td>11,253</td></tr><tr><td>OTC–cleared</td><td>61</td><td>-59</td><td></td><td>2</td><td>29</td><td>-23</td><td></td><td>6</td></tr><tr><td>Exchange traded<sup>(b)</sup></td><td>—</td><td>—</td><td></td><td>—</td><td>—</td><td>—</td><td></td><td>—</td></tr><tr><td>Total foreign exchange contracts</td><td>155,171</td><td>-144,178</td><td></td><td>10,993</td><td>153,210</td><td>-141,951</td><td></td><td>11,259</td></tr><tr><td>Equity contracts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>OTC<sup>(a)</sup></td><td>33,295</td><td>-28,520</td><td></td><td>4,775</td><td>28,321</td><td>-23,949</td><td></td><td>4,372</td></tr><tr><td>OTC–cleared</td><td>—</td><td>—</td><td></td><td>—</td><td>—</td><td>—</td><td></td><td>—</td></tr><tr><td>Exchange traded<sup>(b)</sup></td><td>17,349</td><td>-11,415</td><td></td><td>5,934</td><td>12,000</td><td>-8,767</td><td></td><td>3,233</td></tr><tr><td>Total equity contracts</td><td>50,644</td><td>-39,935</td><td></td><td>10,709</td><td>40,321</td><td>-32,716</td><td></td><td>7,605</td></tr><tr><td>Commodity contracts:</td><td></td><td></td><td></td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>OTC<sup>(a)</sup></td><td>21,993</td><td>-15,318</td><td></td><td>6,675</td><td>28,744</td><td>-22,392</td><td></td><td>6,352</td></tr><tr><td>OTC–cleared</td><td>—</td><td>—</td><td></td><td>—</td><td>—</td><td>—</td><td></td><td>—</td></tr><tr><td>Exchange traded<sup>(b)</sup></td><td>12,367</td><td>-11,212</td><td></td><td>1,155</td><td>14,488</td><td>-12,407</td><td></td><td>2,081</td></tr><tr><td>Total commodity contracts</td><td>34,360</td><td>-26,530</td><td></td><td>7,830</td><td>43,232</td><td>-34,799</td><td></td><td>8,433</td></tr><tr><td>Derivative payables with appropriate legal opinions</td><td>$1,144,452</td><td>$-1,102,835</td><td><sup>(c)</sup></td><td>$41,617</td><td>$1,592,147</td><td>$-1,542,857</td><td><sup>(c)</sup></td><td>$49,290</td></tr><tr><td>Derivative payables where an appropriate legal opinion has not been either sought or obtained</td><td>15,697</td><td></td><td></td><td>15,697</td><td>21,366</td><td></td><td></td><td>21,366</td></tr><tr><td>Total derivative payables recognized on the Consolidated Balance Sheets</td><td>$1,160,149</td><td></td><td></td><td>$57,314</td><td>$1,613,513</td><td></td><td></td><td>$70,656</td></tr></table>
<table><tr><td>Year ended December 31,(in millions)</td><td>2013</td><td>2012</td><td>2011</td></tr><tr><td>Repurchase liability at beginning of period</td><td>$2,811</td><td>$3,557</td><td>$3,285</td></tr><tr><td>Net realized losses<sup>(a)(b)</sup></td><td>-1,561</td><td>-1,158</td><td>-1,263</td></tr><tr><td>Reclassification tolitigation reserve<sup>(c)</sup></td><td>-179</td><td>—</td><td>—</td></tr><tr><td>Provision for repurchase losses<sup>(d)</sup></td><td>-390</td><td>412</td><td>1,535</td></tr><tr><td>Repurchase liability at end of period</td><td>$681</td><td>$2,811</td><td>3,557</td></tr></table>

Question: Which year is Gross derivative payables of Credit contracts OTC the most?
Answer: 2013