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Debt Securities

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

Securities

mortized cost, gross unrealized gains and losses, and estimated fair value of debt securities held to maturity and debt securities available for sale are as follows:

			December 31, 2022
									Recognized in OCI (1)																		Not recognized in OCI
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Carrying Value						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
			(In millions)
Debt securities held to maturity:
Mortgage-backed securities:
Residential agency			$	289					$	—					$	(10)					$	279					$	—					$	(21)					$	258
Commercial agency			523						—						(1)						522						—						(29)						493
			$	812					$	—					$	(11)					$	801					$	—					$	(50)					$	751
Debt securities available for sale:
U.S. Treasury securities			$	1,310					$	—					$	(123)					$	1,187																	$	1,187
Federal agency securities			898						—						(62)						836																		836
Obligations of states and political subdivisions			2						—						—						2																		2
Mortgage-backed securities:
Residential agency			19,477						—						(2,523)						16,954																		16,954
Residential non-agency			1						—						—						1																		1
Commercial agency			8,262						—						(649)						7,613																		7,613
Commercial non-agency			198						—						(12)						186																		186
Corporate and other debt securities			1,219						1						(66)						1,154																		1,154
			$	31,367					$	1					$	(3,435)					$	27,933																	$	27,933

 

			December 31, 2021
									Recognized in OCI (1)																		Not recognized in OCI
			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Carrying Value						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
			(In millions)
Debt securities held to maturity:
Mortgage-backed securities:
Residential agency			$	370					$	—					$	(13)					$	357					$	20					$	—					$	377
Commercial agency			543						—						(1)						542						31						—						573
			$	913					$	—					$	(14)					$	899					$	51					$	—					$	950
Debt securities available for sale:
U.S. Treasury securities			$	1,137					$	2					$	(7)					$	1,132																	$	1,132
Federal agency securities			94						1						(3)						92																		92
Obligations of states and political subdivisions			4						—						—						4																		4
Mortgage-backed securities:
Residential agency			18,873						287						(198)						18,962																		18,962
Residential non-agency			1						—						—						1																		1
Commercial agency			6,271						163						(61)						6,373																		6,373
Commercial non-agency			532						4						—						536																		536
Corporate and other debt securities			1,351						36						(6)						1,381																		1,381
			$	28,263					$	493					$	(275)					$	28,481																	$	28,481

_________

(1)The gross unrealized losses recognized in OCI on securities held to maturity resulted from a transfer of securities available for sale to held to maturity in the second quarter of 2013.

Debt securities with carrying values of $8.8 billion and $9.2 billion at December 31, 2022 and 2021, respectively, were pledged to secure public funds, trust deposits and other borrowing arrangements.

The amortized cost and estimated fair value of debt securities held to maturity and debt securities available for sale at December 31, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

			Amortized Cost						Estimated Fair Value
			(In millions)
Debt securities held to maturity:
Mortgage-backed securities:
Residential agency			$	289					$	258
Commercial agency			523						493
			$	812					$	751
Debt securities available for sale:
Due in one year or less			$	165					$	164
Due after one year through five years			2,276						2,134
Due after five years through ten years			841						753
Due after ten years			147						128
Mortgage-backed securities:
Residential agency			19,477						16,954
Residential non-agency			1						1
Commercial agency			8,262						7,613
Commercial non-agency			198						186
			$	31,367					$	27,933

The following tables present gross unrealized losses and the related estimated fair value of debt securities held to maturity at December 31, 2022 and debt securities available for sale are presented at December 31, 2022 and 2021. For debt securities transferred to held to maturity from available for sale, the analysis in the tables below compares the securities' original amortized cost to its current estimated fair value; there were no unrealized losses on debt securities held to maturity using this analysis at December 31, 2021. All securities in an unrealized loss position are segregated between investments that have been in a continuous unrealized loss position for less than twelve months and for twelve months or more.

			December 31, 2022
			Less Than Twelve Months												Twelve Months or More												Total
			Estimated Fair Value						Gross Unrealized Losses						Estimated Fair Value						Gross Unrealized Losses						Estimated Fair Value						Gross Unrealized Losses
			(In millions)
Debt securities held to maturity:
Mortgage-backed securities:
Residential agency			$	251					$	(29)					$	7					$	(1)					$	258					$	(30)
Commercial agency			469						(26)						24						(4)						493						(30)
			$	720					$	(55)					$	31					$	(5)					$	751					$	(60)
Debt securities available for sale:
U.S Treasury securities			$	276					$	(8)					$	903					$	(115)					$	1,179					$	(123)
Federal agency securities			766						(50)						53						(12)						819						(62)
Mortgage-backed securities:
Residential agency			9,350						(1,005)						7,578						(1,518)						16,928						(2,523)
Commercial agency			6,110						(400)						1,503						(249)						7,613						(649)
Commercial non-agency			141						(8)						45						(4)						186						(12)
Corporate and other debt securities			736						(36)						354						(30)						1,090						(66)
			$	17,379					$	(1,507)					$	10,436					$	(1,928)					$	27,815					$	(3,435)

 

			December 31, 2021
			Less Than Twelve Months												Twelve Months or More												Total
			Estimated Fair Value						Gross Unrealized Losses						Estimated Fair Value						Gross Unrealized Losses						Estimated Fair Value						Gross Unrealized Losses
			(In millions)
Debt securities available for sale:
U.S. Treasury securities			$	1,010					$	(7)					$	—					$	—					$	1,010					$	(7)
Federal agency securities			63						(3)						—						—						63						(3)
Mortgage-backed securities:
Residential agency			9,528						(171)						686						(27)						10,214						(198)
Commercial agency			1,333						(29)						760						(32)						2,093						(61)
Corporate and other debt securities			444						(6)						—						—						444						(6)
			$	12,378					$	(216)					$	1,446					$	(59)					$	13,824					$	(275)

The number of individual debt positions in an unrealized loss position in the tables above increased from 479 at December 31, 2021 to 1,806 at December 31, 2022. The increase in the number of securities and the total amount of unrealized losses from year-end 2021 was primarily due to changes in market interest rates. In instances where an unrealized loss existed, there was no indication of an adverse change in credit on the underlying positions in the tables above. As it relates to these positions, management believes no individual unrealized loss represented credit impairment as of those dates. The Company does not intend to sell, and it is not more likely than not that the Company will be required to sell, the positions before the recovery of their amortized cost basis, which may be at maturity.

Gross realized gains and gross realized losses on sales of debt securities available for sale were immaterial for 2022. 2021 and 2020. The cost of securities sold is based on the specific identification method. As part of the Company's normal process for evaluating impairment, management did not identify any positions where impairment was believed to exist in 2022 or 2021 or 2020.

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- Definition

The entire disclosure for investments in certain debt and equity securities.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 320
-URI https://asc.fasb.org/subtopic&trid=2209399

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 946
-SubTopic 320
-URI https://asc.fasb.org/subtopic&trid=2324412

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 320
-URI https://asc.fasb.org/topic&trid=2196928

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 940
-SubTopic 320
-URI https://asc.fasb.org/subtopic&trid=2176304

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1403
-Paragraph (b)

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