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Derivative Instruments and Hedging Activities (Tables)
 6 Months Ended
Jun. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Gross Fair Values of Derivatives
The table below presents the gross fair values of the Company’s interest rate swaps designated as hedging instruments on the condensed consolidated balance sheets:
June 30, 2025December 31, 2024
AssetsLiabilitiesAssetsLiabilities
Interest rate swaps (1,2)
$— $1 $— $— 
(1) Derivative assets are included in other assets and derivative liabilities are included in accrued expenses and other liabilities on the condensed consolidated balance sheets. Derivative assets as of June 30, 2025 and derivative assets and liabilities as of December 31, 2024 were less than $500 thousand.
(2) Includes reductions related to variation margin settlements. Settlements on derivative positions cleared through CCPs are reflected as reductions to the associated derivative asset and liability balances. As of June 30, 2025, there was a $28 million reduction of derivative assets and a $130 million reduction of derivative liabilities related to variation margin settlements. As of December 31, 2024, there was a $295 million reduction of derivative assets and a $10 million reduction of derivative liabilities related to variation margin settlements.
Fair Value Hedge Derivatives
The following amounts are included on the condensed consolidated balance sheets related to fair value hedges:
Carrying Amount of the Hedged
Assets/(Liabilities)
Cumulative Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged
Assets and Liabilities
June 30, 2025December 31, 2024June 30, 2025December 31, 2024
Line item in which the hedged item is included:
Available for sale securities (1,2)
$14,027 $15,686 $115 $(292)
Long-term debt$(18,741)$(14,908)$(9)$7 
(1) Includes the amortized cost basis of closed portfolios of AFS securities used to designate hedging relationships in which the hedged item is the stated amount of assets in the closed portfolios anticipated to be outstanding for the designated hedge period. At June 30, 2025 and December 31, 2024, the amortized cost basis of the closed portfolios used in these hedging relationships was $2.7 billion and $2.5 billion, respectively, of which $2.1 billion and $2.0 billion was designated in a portfolio layer hedging relationship at June 30, 2025 and December 31, 2024, respectively. The cumulative basis adjustments associated with these hedging relationships were an increase of $9 million and a reduction of $47 million of the amortized cost basis of the closed portfolios at June 30, 2025 and December 31, 2024, respectively.
(2) Excludes the amortized cost and fair value hedging adjustment of AFS securities for which hedge accounting has been discontinued. The cumulative amount of fair value hedging adjustments remaining for these securities was a reduction of the amortized cost basis of $150 million at June 30, 2025 and $2 million at December 31, 2024, which is recorded in AFS securities on the condensed consolidated balance sheets and amortized to interest revenue as a yield adjustment over the lives of the securities.
The table below presents the effect of the Company’s interest rate swaps designated as fair value hedges on the condensed consolidated statements of income:
Location and Amount of Gain (Loss) Recognized in Income
Interest Revenue
Interest Expense
Three Months Ended June 30,2025202420252024
Gain (loss) on fair value hedging relationships:
Hedged items$94 $(40)$9 $— 
Derivatives designated as hedging instruments (1)
(94)38 (9)— 
Six Months Ended June 30,2025202420252024
Gain (loss) on fair value hedging relationships:
Hedged items$255 $(197)$(16)$— 
Derivatives designated as hedging instruments (1)
(255)195 18 — 
(1) Interest revenue excludes net income (expense) from periodic interest accruals and receipts (payments) of $14 million and $32 million for the three and six months ended June 30, 2025, respectively, and $13 million and $16 million for the three and six months ended June 30, 2024, respectively. Interest expense excludes net income (expense) from periodic interest accruals and receipts (payments) of $(14) million and $(24) million, respectively, for the three and six months ended June 30, 2025. We began designating swaps as fair value hedges of Senior Notes in the fourth quarter of 2024. As such, there was no impact to interest expense from periodic interest accruals and receipts (payments) for the three and six months ended June 30, 2024.
The table below presents the effect of the Company’s interest rate swaps designated as cash flow hedges on AOCI and the condensed consolidated statements of income:
Three and Six Months Ended
June 30, 2025
Gain (loss) recognized in other comprehensive income (1)
$(15)
Gain (loss) reclassified from AOCI to interest revenue(17)
(1) Included in net unrealized gain (loss) on derivatives designated as cash flow hedging instruments on the condensed consolidated statements of comprehensive income.