EX-99.2 3 ex_993financialsupplement-.htm EX-99.2

Dollars in millions, except per share data
| Three Months Ended |  | Nine Months Ended
Summary Financial Data & Key Metrics | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Results of Operations: |  |  |  |  |  |
Net interest income | $ | 1,796 |  | $ | 1,821 |  | $ | 1,990 |  |  | $ | 5,434 |  | $ | 4,801 |
Provision for credit losses | 117 |  | 95 |  | 192 |  |  | 276 |  | 1,126 |
Net interest income after provision for credit losses | 1,679 |  | 1,726 |  | 1,798 |  |  | 5,158 |  | 3,675 |
Noninterest income | 650 |  | 639 |  | 615 |  |  | 1,916 |  | 11,532 |
Noninterest expense | 1,456 |  | 1,386 |  | 1,416 |  |  | 4,218 |  | 3,843 |
Income before income taxes | 873 |  | 979 |  | 997 |  |  | 2,856 |  | 11,364 |
Income tax expense | 234 |  | 272 |  | 245 |  |  | 779 |  | 412 |
Net income | 639 |  | 707 |  | 752 |  |  | 2,077 |  | 10,952 |
Preferred stock dividends | 15 |  | 16 |  | 15 |  |  | 46 |  | 44 |
Net income available to common stockholders | $ | 624 |  | $ | 691 |  | $ | 737 |  |  | $ | 2,031 |  | $ | 10,908 |
Adjusted net income available to common stockholders(1) | $ | 660 |  | $ | 739 |  | $ | 813 |  |  | $ | 2,168 |  | $ | 1,870 |
Pre-tax, pre-provision net revenue (PPNR)(1) | $ | 990 |  | $ | 1,074 |  | $ | 1,189 |  |  | $ | 3,132 |  | $ | 12,490 |
Per Share Information: |  |  |  |  |  |
Diluted earnings per common share (EPS) | $ | 43.42 |  | $ | 47.54 |  | $ | 50.67 |  |  | $ | 140.26 |  | $ | 750.19 |
Adjusted diluted EPS(1) | 45.87 |  | 50.87 |  | 55.92 |  |  | 149.71 |  | 128.64 |
Book value per common share at period end | 1,547.81 |  | 1,487.00 |  | 1,343.52 |  |  |  |
Tangible book value per common share (TBV)(1) at period end | 1,504.75 |  | 1,443.92 |  | 1,297.00 |  |  |  |
Key Performance Metrics: |  |  |  |  |  |
Return on average assets (ROA) | 1.15 | % | 1.30 | % | 1.41 | % |  | 1.27 | % | 7.81 | %
Adjusted ROA(1) | 1.22 |  | 1.39 |  | 1.55 |  |  | 1.35 |  | 1.37 |
PPNR ROA(1) | 1.79 |  | 1.97 |  | 2.23 |  |  | 1.91 |  | 8.91 |
Adjusted PPNR ROA(1) | 1.88 |  | 2.08 |  | 2.48 |  |  | 2.03 |  | 2.16 |
Return on average common equity (ROE) | 11.30 |  | 13.13 |  | 15.20 |  |  | 12.73 |  | 90.46 |
Adjusted ROE(1) | 11.94 |  | 14.05 |  | 16.77 |  |  | 13.59 |  | 15.51 |
Return on average tangible common equity (ROTCE)(1) | 11.63 |  | 13.53 |  | 15.76 |  |  | 13.12 |  | 94.17 |
Adjusted ROTCE(1) | 12.29 |  | 14.48 |  | 17.39 |  |  | 14.00 |  | 16.15 |
Efficiency ratio | 59.49 |  | 56.36 |  | 54.34 |  |  | 57.38 |  | 23.53 |
Adjusted efficiency ratio(1) | 54.15 |  | 50.77 |  | 46.04 |  |  | 51.72 |  | 49.85 |
Net interest margin (NIM)(2) | 3.53 |  | 3.64 |  | 4.07 |  |  | 3.62 |  | 3.95 |
NIM, excluding purchase accounting accretion (PAA)(1), (2) | 3.33 |  | 3.36 |  | 3.52 |  |  | 3.35 |  | 3.50 |
Select Balance Sheet Items at Period End: |  |  |  |  |  |
Total investment securities | $ | 38,663 |  | $ | 37,666 |  | $ | 26,818 |  |  |  |
Total loans and leases | 138,695 |  | 139,341 |  | 133,202 |  |  |  |
Total operating lease equipment, net | 9,186 |  | 8,945 |  | 8,661 |  |  |  |
Total deposits | 151,574 |  | 151,079 |  | 146,233 |  |  |  |
Total borrowings | 37,161 |  | 37,458 |  | 37,712 |  |  |  |
Loan to deposit ratio | 91.50 | % | 92.23 | % | 91.09 | % |  |  |
Noninterest-bearing deposits to total deposits | 25.99 |  | 26.49 |  | 29.50 |  |  |  |
Capital Ratios at Period End: (3) |  |  |  |  |  |
Total risk-based capital ratio | 15.36 | % | 15.45 | % | 15.64 | % |  |  |
Tier 1 risk-based capital ratio | 13.78 |  | 13.87 |  | 13.83 |  |  |  |
Common equity Tier 1 ratio | 13.24 |  | 13.33 |  | 13.24 |  |  |  |
Tier 1 leverage capital ratio | 10.20 |  | 10.29 |  | 9.73 |  |  |  |
Asset Quality at Period End: |  |  |  |  |  |
Nonaccrual loans to total loans and leases | 0.90 | % | 0.82 | % | 0.68 | % |  |  |
Allowance for loan and lease losses (ALLL) to loans and leases | 1.21 |  | 1.22 |  | 1.26 |  |  |  |
Net charge-off ratio for the period | 0.42 |  | 0.38 |  | 0.53 |  |  | 0.37 |  | 0.45 |
(1) Denotes a non-GAAP measure. Refer to the non-GAAP reconciliation tables included at the end of this financial supplement for a reconciliation to the most directly comparable GAAP measure. “Adjusted” items exclude the impacts of Notable Items.
(2) Calculated net of average credit balances and deposits of factoring clients. |  |  |  |  |  |
(3) Capital ratios as of the current quarter-end are preliminary pending completion of quarterly regulatory filings.

Dollars in millions, except share and per share data
|  | Three Months Ended |  | Nine Months Ended
Income Statement (unaudited) |  | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Interest income |  |  |  |  |  |  |
Interest and fees on loans |  | $ | 2,430 |  | $ | 2,422 |  | $ | 2,426 |  |  | $ | 7,206 |  | $ | 5,796 |
Interest on investment securities |  | 358 |  | 330 |  | 180 |  |  | 970 |  | 407 |
Interest on deposits at banks |  | 350 |  | 378 |  | 504 |  |  | 1,176 |  | 1,071 |
Total interest income |  | 3,138 |  | 3,130 |  | 3,110 |  |  | 9,352 |  | 7,274 |
Interest expense |  |  |  |  |  |  |
Deposits |  | 1,004 |  | 975 |  | 769 |  |  | 2,907 |  | 1,632 |
Borrowings |  | 338 |  | 334 |  | 351 |  |  | 1,011 |  | 841 |
Total interest expense |  | 1,342 |  | 1,309 |  | 1,120 |  |  | 3,918 |  | 2,473 |
Net interest income |  | 1,796 |  | 1,821 |  | 1,990 |  |  | 5,434 |  | 4,801 |
Provision for credit losses |  | 117 |  | 95 |  | 192 |  |  | 276 |  | 1,126 |
Net interest income after provision for credit losses |  | 1,679 |  | 1,726 |  | 1,798 |  |  | 5,158 |  | 3,675 |
Noninterest income |  |  |  |  |  |  |
Rental income on operating lease equipment |  | 262 |  | 259 |  | 248 |  |  | 776 |  | 719 |
Fee income and other service charges |  | 81 |  | 77 |  | 71 |  |  | 233 |  | 188 |
Client investment fees |  | 55 |  | 54 |  | 52 |  |  | 159 |  | 106 |
Wealth management services |  | 54 |  | 52 |  | 49 |  |  | 157 |  | 140 |
International fees |  | 29 |  | 30 |  | 30 |  |  | 87 |  | 63 |
Service charges on deposit accounts |  | 45 |  | 44 |  | 44 |  |  | 133 |  | 112 |
Factoring commissions |  | 19 |  | 19 |  | 21 |  |  | 55 |  | 60 |
Cardholder services, net |  | 42 |  | 40 |  | 41 |  |  | 122 |  | 103 |
Merchant services, net |  | 12 |  | 12 |  | 12 |  |  | 36 |  | 36 |
Insurance commissions |  | 14 |  | 13 |  | 13 |  |  | 42 |  | 40 |
Realized gain (loss) on sale of investment securities, net |  | 4 |  | — |  | (12) |  |  | 4 |  | (26) |
Fair value adjustment on marketable equity securities, net |  | 9 |  | (2) |  | (1) |  |  | 3 |  | (20) |
Gain on sale of leasing equipment, net |  | 5 |  | 4 |  | 10 |  |  | 19 |  | 18 |
Gain on acquisition |  | — |  | — |  | 12 |  |  | — |  | 9,891 |
Loss on extinguishment of debt |  | — |  | — |  | — |  |  | (2) |  | — |
Other noninterest income |  | 19 |  | 37 |  | 25 |  |  | 92 |  | 102 |
Total noninterest income |  | 650 |  | 639 |  | 615 |  |  | 1,916 |  | 11,532 |
Noninterest expense |  |  |  |  |  |  |
Depreciation on operating lease equipment |  | 99 |  | 98 |  | 95 |  |  | 293 |  | 275 |
Maintenance and other operating lease expenses |  | 59 |  | 60 |  | 51 |  |  | 164 |  | 163 |
Salaries and benefits |  | 788 |  | 745 |  | 727 |  |  | 2,277 |  | 1,922 |
Net occupancy expense |  | 62 |  | 58 |  | 65 |  |  | 182 |  | 179 |
Equipment expense |  | 128 |  | 126 |  | 117 |  |  | 368 |  | 308 |
Professional fees |  | 42 |  | 24 |  | 12 |  |  | 91 |  | 43 |
Third-party processing fees |  | 55 |  | 58 |  | 54 |  |  | 173 |  | 139 |
FDIC insurance expense |  | 31 |  | 33 |  | 36 |  |  | 105 |  | 76 |
Marketing expense |  | 20 |  | 18 |  | 22 |  |  | 52 |  | 78 |
Acquisition-related expenses |  | 46 |  | 44 |  | 121 |  |  | 148 |  | 354 |
Intangible asset amortization |  | 15 |  | 15 |  | 17 |  |  | 47 |  | 40 |
Other noninterest expense |  | 111 |  | 107 |  | 99 |  |  | 318 |  | 266 |
Total noninterest expense |  | 1,456 |  | 1,386 |  | 1,416 |  |  | 4,218 |  | 3,843 |
Income before income taxes |  | 873 |  | 979 |  | 997 |  |  | 2,856 |  | 11,364 |
Income tax expense |  | 234 |  | 272 |  | 245 |  |  | 779 |  | 412 |
Net income |  | $ | 639 |  | $ | 707 |  | $ | 752 |  |  | $ | 2,077 |  | $ | 10,952 |
Preferred stock dividends |  | 15 |  | 16 |  | 15 |  |  | 46 |  | 44 |
Net income available to common stockholders |  | $ | 624 |  | $ | 691 |  | $ | 737 |  |  | $ | 2,031 |  | $ | 10,908 |
Basic earnings per common share |  | $ | 43.42 |  | $ | 47.54 |  | $ | 50.71 |  |  | $ | 140.27 |  | $ | 750.79 |
Diluted earnings per common share |  | $ | 43.42 |  | $ | 47.54 |  | $ | 50.67 |  |  | $ | 140.26 |  | $ | 750.19 |
Weighted average common shares outstanding (basic) |  | 14,375,974 | 14,534,499 | 14,528,310 |  | 14,480,874 | 14,527,718
Weighted average common shares outstanding (diluted) |  | 14,375,974 | 14,534,499 | 14,539,133 |  | 14,481,919 | 14,539,383

Dollars in millions, except share data
Balance Sheet (unaudited) |  | September 30, 2024 | June 30, 2024 | September 30, 2023 |  |
Assets |  |  |  |  |  |
Cash and due from banks |  | $ | 862 |  | $ | 764 |  | $ | 791 |  |  |
Interest-earning deposits at banks |  | 25,640 |  | 25,361 |  | 36,704 |  |  |
Securities purchased under agreements to resell |  | 455 |  | 392 |  | 549 |  |  |
Investment in marketable equity securities |  | 82 |  | 78 |  | 75 |  |  |
Investment securities available for sale |  | 28,190 |  | 27,053 |  | 16,661 |  |  |
Investment securities held to maturity |  | 10,391 |  | 10,535 |  | 10,082 |  |  |
Assets held for sale |  | 68 |  | 92 |  | 58 |  |  |
Loans and leases |  | 138,695 |  | 139,341 |  | 133,202 |  |  |
Allowance for loan and lease losses |  | (1,678) |  | (1,700) |  | (1,673) |  |  |
Loans and leases, net of allowance for loan and lease losses |  | 137,017 |  | 137,641 |  | 131,529 |  |  |
Operating lease equipment, net |  | 9,186 |  | 8,945 |  | 8,661 |  |  |
Premises and equipment, net |  | 1,974 |  | 1,938 |  | 1,768 |  |  |
Goodwill |  | 346 |  | 346 |  | 346 |  |  |
Other intangible assets, net |  | 265 |  | 280 |  | 329 |  |  |
Other assets |  | 6,091 |  | 6,402 |  | 6,212 |  |  |
Total assets |  | $ | 220,567 |  | $ | 219,827 |  | $ | 213,765 |  |  |
Liabilities |  |  |  |  |  |
Deposits: |  |  |  |  |  |
Noninterest-bearing |  | $ | 39,396 |  | $ | 40,016 |  | $ | 43,141 |  |  |
Interest-bearing |  | 112,178 |  | 111,063 |  | 103,092 |  |  |
Total deposits |  | 151,574 |  | 151,079 |  | 146,233 |  |  |
Credit balances of factoring clients |  | 1,250 |  | 1,175 |  | 1,282 |  |  |
Borrowings: |  |  |  |  |  |
Short-term borrowings |  | 391 |  | 386 |  | 453 |  |  |
Long-term borrowings |  | 36,770 |  | 37,072 |  | 37,259 |  |  |
Total borrowings |  | 37,161 |  | 37,458 |  | 37,712 |  |  |
Other liabilities |  | 7,754 |  | 7,628 |  | 8,149 |  |  |
Total liabilities |  | $ | 197,739 |  | $ | 197,340 |  | $ | 193,376 |  |  |
Stockholders’ equity |  |  |  |  |  |
Preferred stock |  | 881 | 881 |  | 881 |  |  |
Common stock: |  |  |  |  |  |
Class A - $1 par value |  | 13 |  | 14 |  | 14 |  |
Class B - $1 par value |  | 1 |  | 1 |  | 1 |  |  |
Additional paid in capital |  | 3,389 |  | 4,099 |  | 4,106 |  |  |
Retained earnings |  | 18,703 |  | 18,102 |  | 16,267 |  |  |
Accumulated other comprehensive loss |  | (159) |  | (610) |  | (880) |  |  |
Total stockholders’ equity |  | 22,828 |  | 22,487 |  | 20,389 |  |  |
Total liabilities and stockholders’ equity |  | $ | 220,567 |  | $ | 219,827 |  | $ | 213,765 |  |  |

Dollars in millions, except share per share data
Notable Items (1) |  | Three Months Ended |  | Nine Months Ended
| September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Noninterest income |  |  |  |  |  |  |
Rental income on operating lease equipment (2) |  | $ | (158) |  | $ | (158) |  | $ | (146) |  |  | $ | (457) |  | $ | (438) |
Realized (gain) loss on sale of investment securities, net |  | (4) |  | — |  | 12 |  |  | (4) |  | 26 |
Fair value adjustment on marketable equity securities, net |  | (9) |  | 2 |  | 1 |  |  | (3) |  | 20 |
Gain on sale of leasing equipment, net |  | (5) |  | (4) |  | (10) |  |  | (19) |  | (18) |
Gain on acquisition |  | — |  | — |  | (12) |  |  | — |  | (9,891) |
Loss on extinguishment of debt |  | — |  | — |  | — |  |  | 2 |  | — |
Other noninterest income (3) |  | — |  | — |  | 8 |  |  | (4) |  | 8 |
Impact of notable items on adjusted noninterest income |  | $ | (176) |  | $ | (160) |  | $ | (147) |  |  | $ | (485) |  | $ | (10,293) |
Noninterest expense |  |  |  |  |  |  |
Depreciation on operating lease equipment (2) |  | (99) |  | (98) |  | (95) |  |  | (293) |  | (275) |
Maintenance and other operating lease equipment expense (2) |  | (59) |  | (60) |  | (51) |  |  | (164) |  | (163) |
Professional fees (4) |  | — |  | (1) |  | — |  |  | (4) |  | — |
FDIC insurance special assessment |  | — |  | (2) |  | — |  |  | (11) |  | — |
Acquisition-related expenses |  | (46) |  | (44) |  | (121) |  |  | (148) |  | (354) |
Intangible asset amortization |  | (15) |  | (15) |  | (17) |  |  | (47) |  | (40) |
Other noninterest expense (5) |  | (8) |  | 2 |  | — |  |  | — |  | — |
Impact of notable items on adjusted noninterest expense |  | $ | (227) |  | $ | (218) |  | $ | (284) |  |  | $ | (667) |  | $ | (832) |
Day 2 provisions for loan and lease losses and off-balance sheet credit exposure |  | $ | — |  | $ | — |  | $ | — |  |  | $ | — |  | $ | (716) |
Benefit for credit losses on investment securities available for sale |  | — |  | — |  | 3 |  |  | — |  | — |
Impact of notable items on adjusted provision for credit losses |  | $ | — |  | $ | — |  | $ | 3 |  |  | $ | — |  | $ | (716) |
Impact of notable items on adjusted pre-tax income |  | $ | 51 |  | $ | 58 |  | $ | 134 |  |  | $ | 182 |  | $ | (8,745) |
Income tax impact (6) |  | 15 | 10 |  | 58 |  |  | 45 |  | 293 |
Impact of notable items on adjusted net income |  | $ | 36 |  | $ | 48 |  | $ | 76 |  |  | $ | 137 |  | $ | (9,038) |
Impact of notable items on adjusted diluted EPS |  | $ | 2.45 |  | $ | 3.33 |  | $ | 5.25 |  |  | $ | 9.45 |  | $ | (621.55) |

(1) Notable items include income and expense for infrequent transactions and certain recurring items (typically noncash) that management believes should be excluded from adjusted measures (non-GAAP) to enhance understanding of operations and comparability to historical periods. Management utilizes both GAAP and adjusted measures (non-GAAP) to analyze BancShares’ performance. Refer to subsequent pages of this financial supplement for a reconciliation of non-GAAP measures to the most directly comparable GAAP measures.
(2) Depreciation and maintenance and other operating lease expenses are deducted from rental income on operating lease equipment to calculate adjusted rental income on operating lease equipment (non-GAAP). There is no net impact to earnings for this non-GAAP item because adjusted noninterest income and expense are reduced by the same amount. Management believes adjusted rental income on operating lease equipment (non-GAAP) is meaningful because it helps management monitor the performance and profitability of the operating leases after deducting direct expenses. Refer to subsequent pages of this financial supplement for a reconciliation of non-GAAP measures to the most directly comparable GAAP measures.
(3) Other noninterest income includes a gain on litigation settlement in the 2024 YTD period and a Silicon Valley Bridge Bank, N.A purchase accounting adjustment related to FX translation in the 2023 QTD and YTD periods.
(4) Professional fees include expenses related to integration activities.
(5) Other noninterest expense consists of a technology fee in 3Q24 and a litigation reserve release in 2Q24.
(6) For the periods presented, the income tax impact may include tax discrete items and changes in the estimated annualized effective tax rate.

Dollars in millions, except share and per share data
Condensed Income Statements (unaudited) - Adjusted for Notable Items (1) | Three Months Ended |  | Nine Months Ended
September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Interest income | $ | 3,138 |  | $ | 3,130 |  | $ | 3,110 |  |  | $ | 9,352 |  | $ | 7,274 |
Interest expense | 1,342 |  | 1,309 |  | 1,120 |  |  | 3,918 |  | 2,473 |
Net interest income | 1,796 |  | 1,821 |  | 1,990 |  |  | 5,434 |  | 4,801 |
Provision for credit losses | 117 |  | 95 |  | 195 |  |  | 276 |  | 410 |
Net interest income after provision for credit losses | 1,679 |  | 1,726 |  | 1,795 |  |  | 5,158 |  | 4,391 |
Noninterest income | 474 |  | 479 |  | 468 |  |  | 1,431 |  | 1,239 |
Noninterest expense | 1,229 |  | 1,168 |  | 1,132 |  |  | 3,551 |  | 3,011 |
Income before income taxes | 924 |  | 1,037 |  | 1,131 |  |  | 3,038 |  | 2,619 |
Income tax expense | 249 |  | 282 |  | 303 |  |  | 824 |  | 705 |
Net income | $ | 675 |  | $ | 755 |  | $ | 828 |  |  | $ | 2,214 |  | $ | 1,914 |
Preferred stock dividends | 15 |  | 16 |  | 15 |  |  | 46 |  | 44 |
Net income available to common stockholders | $ | 660 |  | $ | 739 |  | $ | 813 |  |  | $ | 2,168 |  | $ | 1,870 |
Basic earnings per common share | $ | 45.87 |  | $ | 50.87 |  | $ | 55.96 |  |  | $ | 149.72 |  | $ | 128.74 |
Diluted earnings per common share | 45.87 |  | 50.87 |  | 55.92 |  |  | 149.71 | 128.64
Weighted average common shares outstanding (basic) | 14,375,974 | 14,534,499 | 14,528,310 |  | 14,480,874 | 14,527,718
Weighted average common shares outstanding (diluted) | 14,375,974 | 14,534,499 | 14,539,133 |  | 14,481,919 | 14,539,383

(1) The GAAP income statements and notable items are included previously in this financial supplement. The condensed adjusted income statements above (non-GAAP) exclude the impact of notable items. Refer to the non-GAAP reconciliation tables at the end of this financial supplement for a reconciliation of non-GAAP measures to the most directly comparable GAAP measure.

Dollars in millions
Loans and Leases by Class (end of period) | September 30, 2024 | June 30, 2024 | September 30, 2023 |  |  |
Commercial |  |  |  |  |  |
Commercial construction | $ | 4,924 |  | $ | 4,484 |  | $ | 3,946 |  |  |  |
Owner occupied commercial mortgages | 16,372 |  | 16,233 |  | 15,148 |  |  |  |
Non-owner occupied commercial mortgages | 16,078 |  | 15,580 |  | 14,243 |  |  |  |
Commercial and industrial | 30,867 |  | 30,684 |  | 28,717 |  |  |  |
Leases | 2,020 |  | 2,049 |  | 2,108 |  |  |  |
Total commercial | $ | 70,261 |  | $ | 69,030 |  | $ | 64,162 |  |  |  |
Consumer |  |  |  |  |  |
Residential mortgage | $ | 23,237 |  | $ | 23,101 |  | $ | 22,465 |  |  |  |
Revolving mortgage | 2,455 |  | 2,351 |  | 2,067 |  |  |  |
Consumer auto | 1,543 |  | 1,503 |  | 1,411 |  |  |  |
Consumer other | 1,347 |  | 1,388 |  | 1,191 |  |  |  |
Total consumer | $ | 28,582 |  | $ | 28,343 |  | $ | 27,134 |  |  |  |
SVB |  |  |  |  |  |
Global fund banking | $ | 27,114 |  | $ | 28,915 |  | $ | 27,516 |  |  |  |
Investor dependent - early stage | 1,128 |  | 1,179 |  | 1,718 |  |  |  |
Investor dependent - growth stage | 2,434 |  | 2,627 |  | 3,948 |  |  |  |
Innovation C&I and cash flow dependent | 9,176 |  | 9,247 |  | 8,724 |  |  |  |
Total SVB | $ | 39,852 |  | $ | 41,968 |  | $ | 41,906 |  |  |  |
Total loans and leases | $ | 138,695 |  | $ | 139,341 |  | $ | 133,202 |  |  |  |
Less: allowance for loan and lease losses | (1,678) |  | (1,700) |  | (1,673) |  |  |  |
Total loans and leases, net of allowance for loan and lease losses | $ | 137,017 |  | $ | 137,641 |  | $ | 131,529 |  |  |  |
Deposits by Type (end of period) | September 30, 2024 | June 30, 2024 | September 30, 2023 |  |  |
Noninterest-bearing demand | $ | 39,396 |  | $ | 40,016 |  | $ | 43,141 |  |  |  |
Checking with interest | 23,216 |  | 23,907 |  | 23,461 |  |  |  |
Money market | 34,567 |  | 32,636 |  | 30,079 |  |  |  |
Savings | 40,266 |  | 39,361 |  | 32,708 |  |  |  |
Time | 14,129 |  | 15,159 |  | 16,844 |  |  |  |
Total deposits | $ | 151,574 |  | $ | 151,079 |  | $ | 146,233 |  |  |  |

Dollars in millions
| Three Months Ended |  | Nine Months Ended
Credit Quality and Allowance for Loan and Lease Losses (ALLL) | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Nonaccrual loans at period end | $ | 1,244 |  | $ | 1,141 |  | $ | 899 |  |  |  |
Ratio of nonaccrual loans to total loans at period end | 0.90 | % | 0.82 | % | 0.68 | % |  |  |
Charge-offs | $ | (177) |  | $ | (159) |  | $ | (199) |  |  | $ | (464) |  | $ | (437) |
Recoveries | 32 |  | 27 |  | 23 |  |  | 84 |  | 54 |
Net charge-offs | $ | (145) |  | $ | (132) |  | $ | (176) |  |  | $ | (380) |  | $ | (383) |
Net charge-off ratio | 0.42 | % | 0.38 | % | 0.53 | % |  | 0.37 | % | 0.45 | %
ALLL to loans ratio at period end | 1.21 | % | 1.22 | % | 1.26 | % |  |  |
ALLL at beginning of period | $ | 1,700 |  | $ | 1,737 |  | $ | 1,637 |  |  | $ | 1,747 |  | $ | 922 |
Initial PCD ALLL | — |  | — |  | — |  |  | — |  | 220 |
Day 2 provision for loan and lease losses | — |  | — |  | — |  |  | — |  | 462 |
Provision for loan and lease losses | 123 |  | 95 |  | 212 |  |  | 311 |  | 452 |
Net charge-offs | (145) |  | (132) |  | (176) |  |  | (380) |  | (383) |
ALLL at end of period | $ | 1,678 |  | $ | 1,700 |  | $ | 1,673 |  |  | $ | 1,678 |  | $ | 1,673 |

Dollars in millions | Three Months Ended |
Average Balance Sheets, Yields and Rates | September 30, 2024 | June 30, 2024 | September 30, 2023 |
Average Balance | Income/Expense | Yield/Rate | Average Balance | Income/Expense | Yield/Rate | Average Balance | Income/Expense | Yield/Rate |  |  |
Loans and leases (1)(2) | $ | 137,602 |  | $ | 2,430 |  | 7.03 | % | $ | 135,965 |  | $ | 2,422 |  | 7.15 | % | $ | 131,653 |  | $ | 2,426 |  | 7.30 | % |  |  |
Investment securities | 38,189 |  | 354 |  | 3.70 |  | 36,445 |  | 327 |  | 3.60 |  | 24,388 |  | 177 |  | 2.90 |  |  |  |
Securities purchased under agreements to resell | 241 |  | 4 |  | 5.34 |  | 236 |  | 3 |  | 5.37 |  | 223 |  | 3 |  | 5.28 |  |  |  |
Interest-earning deposits at banks | 26,167 |  | 350 |  | 5.33 |  | 28,059 |  | 378 |  | 5.42 |  | 37,456 |  | 504 |  | 5.34 |  |  |  |
Total interest-earning assets (2) | $ | 202,199 |  | $ | 3,138 |  | 6.18 | % | $ | 200,705 |  | $ | 3,130 |  | 6.26 | % | $ | 193,720 |  | $ | 3,110 |  | 6.37 | % |  |  |
Operating lease equipment, net | $ | 9,028 |  |  |  | $ | 8,888 |  |  |  | $ | 8,617 |  |  |  |  |  |
Cash and due from banks | 717 |  |  |  | 750 |  |  |  | 911 |  |  |  |  |  |
Allowance for loan and lease losses | (1,725) |  |  |  | (1,763) |  |  |  | (1,714) |  |  |  |  |  |
All other noninterest-earning assets | 10,247 |  |  |  | 10,311 |  |  |  | 10,460 |  |  |  |  |  |
Total assets | $ | 220,466 |  |  |  | $ | 218,891 |  |  |  | $ | 211,994 |  |  |  |  |  |
Interest-bearing deposits |  |  |  |  |  |  |  |  |  |  |  |
Checking with interest | $ | 23,946 |  | $ | 134 |  | 2.23 | % | $ | 24,427 |  | $ | 137 |  | 2.26 | % | $ | 24,600 |  | $ | 134 |  | 2.15 | % |  |  |
Money market | 34,127 |  | 278 |  | 3.24 |  | 31,998 |  | 250 |  | 3.14 |  | 29,684 |  | 179 |  | 2.40 |  |  |  |
Savings | 39,944 |  | 436 |  | 4.34 |  | 38,434 |  | 415 |  | 4.35 |  | 30,185 |  | 303 |  | 3.99 |  |  |  |
Time deposits | 14,429 |  | 156 |  | 4.29 |  | 16,043 |  | 173 |  | 4.33 |  | 16,489 |  | 153 |  | 3.68 |  |  |  |
Total interest-bearing deposits | 112,446 |  | 1,004 |  | 3.55 |  | 110,902 |  | 975 |  | 3.54 |  | 100,958 |  | 769 |  | 3.02 |  |  |  |
Borrowings: |  |  |  |  |  |  |  |  |  |  |  |
Securities sold under customer repurchase agreements | 384 |  | — |  | 0.55 |  | 380 |  | — |  | 0.46 |  | 454 |  | — |  | 0.35 |  |  |  |
Short-term FHLB borrowings | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  |  |  |
Short-term borrowings | 384 |  | — |  | 0.55 |  | 380 |  | — |  | 0.46 |  | 454 |  | — |  | 0.35 |  |  |  |
Federal Home Loan Bank borrowings | — |  | — |  | 2.01 |  | — |  | — |  | 2.00 |  | 444 |  | 6 |  | 5.47 |  |  |  |
Senior unsecured borrowings | 361 |  | 2 |  | 2.59 |  | 375 |  | 3 |  | 2.49 |  | 382 |  | 2 |  | 2.46 |  |  |  |
Subordinated debt | 900 |  | 8 |  | 3.34 |  | 901 |  | 7 |  | 3.32 |  | 1,042 |  | 10 |  | 3.65 |  |  |  |
Other borrowings | 35,803 |  | 328 |  | 3.66 |  | 35,824 |  | 324 |  | 3.61 |  | 35,831 |  | 333 |  | 3.71 |  |  |  |
Long-term borrowings | 37,064 |  | 338 |  | 3.64 |  | 37,100 |  | 334 |  | 3.60 |  | 37,699 |  | 351 |  | 3.72 |  |  |  |
Total borrowings | 37,448 |  | 338 |  | 3.61 |  | 37,480 |  | 334 |  | 3.56 |  | 38,153 |  | 351 |  | 3.68 |  |  |  |
Total interest-bearing liabilities | $ | 149,894 |  | $ | 1,342 |  | 3.57 | % | $ | 148,382 |  | $ | 1,309 |  | 3.54 | % | $ | 139,111 |  | $ | 1,120 |  | 3.20 | % |  |  |
Noninterest-bearing deposits | $ | 39,026 |  |  |  | $ | 39,344 |  |  |  | $ | 43,085 |  |  |  |  |  |
Credit balances of factoring clients | 1,195 |  |  |  | 1,234 |  |  |  | 1,209 |  |  |  |  |  |
Other noninterest-bearing liabilities | 7,500 |  |  |  | 7,879 |  |  |  | 8,473 |  |  |  |  |  |
Stockholders' equity | 22,851 |  |  |  | 22,052 |  |  |  | 20,116 |  |  |  |  |  |
Total liabilities and stockholders’ equity | $ | 220,466 |  |  |  | $ | 218,891 |  |  |  | $ | 211,994 |  |  |  |  |  |
Net interest income |  | $ | 1,796 |  |  |  | $ | 1,821 |  |  |  | $ | 1,990 |  |  |  |  |
Net interest spread (2) |  |  | 2.61 | % |  |  | 2.72 | % |  |  | 3.17 | % |  |  |
Net interest margin (2) |  |  | 3.53 | % |  |  | 3.64 | % |  |  | 4.07 | % |  |  |
(1) Loans and leases include nonaccrual loans and loans held for sale. Interest income on loans and leases includes loan PAA income and loan fees. |  |  |
(2) The balance and rate presented are calculated net of average credit balances and deposits of factoring clients. |  |  |
Note: Certain items above do not precisely recalculate as presented due to rounding. |  |  |  |

Dollars in millions | Nine Months Ended
Average Balance Sheets, Yields and Rates | September 30, 2024 |  | September 30, 2023
Average Balance | Income/Expense | Yield/Rate |  |  |  | Average Balance | Income/Expense | Yield/Rate
Loans and leases (1)(2) | $ | 135,302 |  | $ | 7,206 |  | 7.11 | % |  |  |  | $ | 113,028 |  | $ | 5,796 |  | 6.85 | %
Investment securities | 35,769 |  | 960 |  | 3.58 |  |  |  |  | 21,222 |  | 401 |  | 2.52 |
Securities purchased under agreements to resell | 240 |  | 10 |  | 5.37 |  |  |  |  | 139 |  | 6 |  | 5.12 |
Interest-earning deposits at banks | 29,192 |  | 1,176 |  | 5.38 |  |  |  |  | 27,794 |  | 1,071 |  | 5.15 |
Total interest-earning assets (2) | $ | 200,503 |  | $ | 9,352 |  | 6.22 | % |  |  |  | $ | 162,183 |  | $ | 7,274 |  | 5.99 | %
Operating lease equipment, net | $ | 8,908 |  |  |  |  |  |  | $ | 8,421 |  |  |
Cash and due from banks | 751 |  |  |  |  |  |  | 891 |  |  |
Allowance for loan and lease losses | (1,762) |  |  |  |  |  |  | (1,420) |  |  |
All other noninterest-earning assets | 10,087 |  |  |  |  |  |  | 17,354 |  |  |
Total assets | $ | 218,487 |  |  |  |  |  |  | $ | 187,429 |  |  |
Interest-bearing deposits |  |  |  |  |  |  |  |  |
Checking with interest | $ | 24,112 |  | $ | 401 |  | 2.22 | % |  |  |  | $ | 21,783 |  | $ | 274 |  | 1.68 | %
Money market | 32,358 |  | 760 |  | 3.14 |  |  |  |  | 26,686 |  | 407 |  | 2.04 |
Savings | 38,296 |  | 1,242 |  | 4.33 |  |  |  |  | 23,410 |  | 601 |  | 3.44 |
Time deposits | 15,712 |  | 504 |  | 4.28 |  |  |  |  | 14,404 |  | 350 |  | 3.25 |
Total interest-bearing deposits | 110,478 |  | 2,907 |  | 3.51 |  |  |  |  | 86,283 |  | 1,632 |  | 2.53 |
Borrowings: |  |  |  |  |  |  |  |  |
Securities sold under customer repurchase agreements | 398 |  | 1 |  | 0.49 |  |  |  |  | 455 |  | 1 |  | 0.32 |
Short-term FHLB borrowings | — |  | — |  | — |  |  |  |  | 145 |  | 5 |  | 4.79 |
Short-term borrowings | 398 |  | 1 |  | 0.49 |  |  |  |  | 600 |  | 6 |  | 1.40 |
Federal Home Loan Bank borrowings | — |  | — |  | 2.00 |  |  |  |  | 3,084 |  | 120 |  | 5.22 |
Senior unsecured borrowings | 371 |  | 7 |  | 2.53 |  |  |  |  | 686 |  | 11 |  | 2.16 |
Subordinated debt | 904 |  | 23 |  | 3.32 |  |  |  |  | 1,045 |  | 29 |  | 3.59 |
Other borrowings | 35,829 |  | 980 |  | 3.65 |  |  |  |  | 24,450 |  | 675 |  | 3.68 |
Long-term borrowings | 37,104 |  | 1,010 |  | 3.63 |  |  |  |  | 29,265 |  | 835 |  | 3.80 |
Total borrowings | 37,502 |  | 1,011 |  | 3.59 |  |  |  |  | 29,865 |  | 841 |  | 3.75 |
Total interest-bearing liabilities | $ | 147,980 |  | $ | 3,918 |  | 3.53 | % |  |  |  | $ | 116,148 |  | $ | 2,473 |  | 2.84 | %
Noninterest-bearing deposits | $ | 39,339 |  |  |  |  |  |  | $ | 39,007 |  |  |
Credit balances of factoring clients | 1,178 |  |  |  |  |  |  | 1,129 |  |  |
Other noninterest-bearing liabilities | 7,793 |  |  |  |  |  |  | 14,143 |  |  |
Stockholders' equity | 22,197 |  |  |  |  |  |  | 17,002 |  |  |
Total liabilities and stockholders’ equity | $ | 218,487 |  |  |  |  |  |  | $ | 187,429 |  |  |
Net interest income |  | $ | 5,434 |  |  |  |  |  |  | $ | 4,801 |  |
Net interest spread (2) |  |  | 2.69 | % |  |  |  |  |  | 3.15 | %
Net interest margin (2) |  |  | 3.62 | % |  |  |  |  |  | 3.95 | %
(1) Loans and leases include nonaccrual loans and loans held for sale. Interest income on loans and leases includes loan PAA income and loan fees.
(2) The balance and rate presented are calculated net of average credit balances and deposits of factoring clients.
Note: Certain items above do not precisely recalculate as presented due to rounding. |

Dollars in millions, except share and per share data
|  | Three Months Ended |  | Nine Months Ended
Non-GAAP Reconciliations |  | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Net income and EPS |  |  |  |  |  |  |
Net income (GAAP) | a | $ | 639 |  | $ | 707 |  | $ | 752 |  |  | $ | 2,077 |  | $ | 10,952 |
Preferred stock dividends |  | 15 |  | 16 |  | 15 |  |  | 46 |  | 44 |
Net income available to common stockholders (GAAP) | b | $ | 624 |  | $ | 691 |  | $ | 737 |  |  | $ | 2,031 |  | $ | 10,908 |
Total notable items, after income tax | c | 36 |  | 48 |  | 76 |  |  | 137 |  | (9,038) |
Adjusted net income (non-GAAP) | d = (a+c) | 675 |  | 755 |  | 828 |  |  | 2,214 |  | 1,914 |
Adjusted net income available to common stockholders (non-GAAP) | e = (b+c) | $ | 660 |  | $ | 739 |  | $ | 813 |  |  | $ | 2,168 |  | $ | 1,870 |
Weighted average common shares outstanding |  |  |  |  |  |  |
Basic | f | 14,375,974 |  | 14,534,499 |  | 14,528,310 |  |  | 14,480,874 |  | 14,527,718 |
Diluted | g | 14,375,974 |  | 14,534,499 |  | 14,539,133 |  |  | 14,481,919 |  | 14,539,383 |
EPS (GAAP) |  |  |  |  |  |  |
Basic | b/f | $ | 43.42 |  | $ | 47.54 |  | $ | 50.71 |  |  | $ | 140.27 |  | $ | 750.79 |
Diluted | b/g | 43.42 |  | 47.54 |  | 50.67 |  |  | 140.26 |  | 750.19 |
Adjusted EPS (non-GAAP) |  |  |  |  |  |  |
Basic | e/f | $ | 45.87 |  | $ | 50.87 |  | $ | 55.96 |  |  | $ | 149.72 |  | $ | 128.74 |
Diluted | e/g | 45.87 |  | 50.87 |  | 55.92 |  |  | 149.71 |  | 128.64 |
Noninterest income and expense |  |  |  |  |  |  |
Noninterest income (GAAP) | h | $ | 650 |  | $ | 639 |  | $ | 615 |  |  | $ | 1,916 |  | $ | 11,532 |
Impact of notable items, before income tax |  | (176) |  | (160) |  | (147) |  |  | (485) |  | (10,293) |
Adjusted noninterest income (non-GAAP) | i | $ | 474 |  | $ | 479 |  | $ | 468 |  |  | $ | 1,431 |  | $ | 1,239 |
Noninterest expense (GAAP) | j | $ | 1,456 |  | $ | 1,386 |  | $ | 1,416 |  |  | $ | 4,218 |  | $ | 3,843 |
Impact of notable items, before income tax |  | (227) |  | (218) |  | (284) |  |  | (667) |  | (832) |
Adjusted noninterest expense (non-GAAP) | k | $ | 1,229 |  | $ | 1,168 |  | $ | 1,132 |  |  | $ | 3,551 |  | $ | 3,011 |
Provision for credit losses |  |  |  |  |  |  |
Provision for credit losses |  | $ | 117 |  | $ | 95 |  | $ | 192 |  |  | $ | 276 |  | $ | 1,126 |
Less: day 2 provision for loan and lease losses and off-balance sheet exposure |  | — |  | — |  | — |  |  | — |  | 716 |
Less: provision (benefit) for credit losses on investment securities available for sale |  | — |  | — |  | (3) |  |  | — |  | — |
Adjusted provision for credit losses (non-GAAP) |  | $ | 117 |  | $ | 95 |  | $ | 195 |  |  | $ | 276 |  | $ | 410 |
PPNR |  |  |  |  |  |  |
Net income (GAAP) | a | $ | 639 |  | $ | 707 |  | $ | 752 |  |  | $ | 2,077 |  | $ | 10,952 |
Plus: |  |  |  |  |  |  |
Provision for credit losses |  | 117 |  | 95 |  | 192 |  |  | 276 |  | 1,126 |
Income tax expense |  | 234 |  | 272 |  | 245 |  |  | 779 |  | 412 |
PPNR (non-GAAP) | l | $ | 990 |  | $ | 1,074 |  | $ | 1,189 |  |  | $ | 3,132 |  | $ | 12,490 |
Impact of notable items (1) |  | 51 |  | 58 |  | 137 |  |  | 182 |  | (9,461) |
Adjusted PPNR (non-GAAP) | m | $ | 1,041 |  | $ | 1,132 |  | $ | 1,326 |  |  | $ | 3,314 |  | $ | 3,029 |
(1) Excludes the notable items for the provision for credit losses and income taxes as these items are excluded from PPNR as presented in the table above.
Note: Certain items above do not precisely recalculate as presented due to rounding.

Dollars in millions
|  | Three Months Ended |  | Nine Months Ended
Non-GAAP Reconciliations (continued) |  | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
ROA |  |  |  |  |  |  |
Net income (GAAP) | a | $ | 639 |  | $ | 707 |  | $ | 752 |  |  | $ | 2,077 |  | $ | 10,952 |
Annualized net income | n = a annualized | 2,544 |  | 2,842 |  | 2,983 |  |  | 2,775 |  | 14,642 |
Adjusted net income (non-GAAP) | d | 675 |  | 755 |  | 828 |  |  | 2,214 |  | 1,914 |
Annualized adjusted net income | p = d annualized | 2,684 |  | 3,036 |  | 3,286 |  |  | 2,958 |  | 2,560 |
Average assets | o | 220,466 |  | 218,891 |  | 211,994 |  |  | 218,487 |  | 187,429 |
ROA | n/o | 1.15 | % | 1.30 | % | 1.41 | % |  | 1.27 | % | 7.81 | %
Adjusted ROA (non-GAAP) | p/o | 1.22 |  | 1.39 |  | 1.55 |  |  | 1.35 |  | 1.37 |
PPNR ROA |  |  |  |  |  |  |
PPNR (non-GAAP) | l | $ | 990 |  | $ | 1,074 |  | $ | 1,189 |  |  | $ | 3,132 |  | $ | 12,490 |
Annualized PPNR | q = l annualized | 3,942 |  | 4,316 |  | 4,717 |  |  | 4,184 |  | 16,699 |
Adjusted PPNR (non-GAAP) | m | 1,041 |  | 1,132 |  | 1,326 |  |  | 3,314 |  | 3,029 |
Annualized adjusted PPNR | r = m annualized | 4,141 |  | 4,552 |  | 5,261 |  |  | 4,427 |  | 4,049 |
PPNR ROA (non-GAAP) | q/o | 1.79 | % | 1.97 | % | 2.23 | % |  | 1.91 | % | 8.91 | %
Adjusted PPNR ROA (non-GAAP) | r/o | 1.88 |  | 2.08 |  | 2.48 |  |  | 2.03 |  | 2.16 |
ROE and ROTCE |  |  |  |  |  |  |
Annualized net income available to common stockholders | s = b annualized | $ | 2,483 |  | $ | 2,779 |  | $ | 2,923 |  |  | $ | 2,713 |  | $ | 14,583 |
Annualized adjusted net income available to common stockholders | t = e annualized | $ | 2,623 |  | $ | 2,974 |  | $ | 3,225 |  |  | $ | 2,896 |  | $ | 2,501 |
Average stockholders' equity (GAAP) |  | $ | 22,851 |  | $ | 22,052 |  | $ | 20,116 |  |  | $ | 22,197 |  | $ | 17,002 |
Less: average preferred stock |  | 881 |  | 881 |  | 881 |  |  | 881 |  | 881 |
Average common stockholders' equity | u | $ | 21,970 |  | $ | 21,171 |  | $ | 19,235 |  |  | $ | 21,316 |  | $ | 16,121 |
Less: average goodwill |  | 346 |  | 346 |  | 346 |  |  | 346 |  | 346 |
Less: average other intangible assets |  | 275 |  | 288 |  | 338 |  |  | 290 |  | 290 |
Average tangible common equity (non-GAAP) | v | $ | 21,349 |  | $ | 20,537 |  | $ | 18,551 |  |  | $ | 20,680 |  | $ | 15,485 |
ROE | s/u | 11.30 | % | 13.13 | % | 15.20 | % |  | 12.73 | % | 90.46 | %
Adjusted ROE (non-GAAP) | t/u | 11.94 |  | 14.05 |  | 16.77 |  |  | 13.59 |  | 15.51 |
ROTCE (non-GAAP) | s/v | 11.63 |  | 13.53 |  | 15.76 |  |  | 13.12 |  | 94.17 |
Adjusted ROTCE (non-GAAP) | t/v | 12.29 |  | 14.48 |  | 17.39 |  |  | 14.00 |  | 16.15 |
Tangible common equity to tangible assets at period end |  |  |  |  |  |  |
Stockholders' equity (GAAP) | w | $ | 22,828 |  | $ | 22,487 |  | $ | 20,389 |  |  |  |
Less: preferred stock |  | 881 |  | 881 |  | 881 |  |  |  |
Common equity | x | $ | 21,947 |  | $ | 21,606 |  | $ | 19,508 |  |  |  |
Less: goodwill |  | 346 |  | 346 |  | 346 |  |  |  |
Less: other intangible assets |  | 265 |  | 280 |  | 329 |  |  |  |
Tangible common equity (non-GAAP) | y | $ | 21,336 |  | $ | 20,980 |  | $ | 18,833 |  |  |  |
Total assets (GAAP) | z | 220,567 |  | 219,827 |  | 213,765 |  |  |  |
Tangible assets (non-GAAP) | aa | 219,956 |  | 219,201 |  | 213,090 |  |  |  |
Total equity to total assets (GAAP) | w/z | 10.35 | % | 10.23 | % | 9.54 | % |  |  |
Tangible common equity to tangible assets (non-GAAP) | y/aa | 9.70 |  | 9.57 |  | 8.84 |  |  |  |
Note: Certain items above do not precisely recalculate as presented due to rounding.

Dollars in millions, except share and per share data
|  | Three Months Ended |  | Nine Months Ended
Non-GAAP Reconciliations (continued) |  | September 30, 2024 | June 30, 2024 | September 30, 2023 |  | September 30, 2024 | September 30, 2023
Book value and tangible book value per common share at period end |  |  |  |  |  |  |
Common shares outstanding at period end | bb | 14,179,208 |  | 14,529,735 |  | 14,520,103 |  |  |  |
Book value per share | x/bb | $ | 1,547.81 |  | $ | 1,487.00 |  | $ | 1,343.52 |  |  |  |
Tangible book value per common share (non-GAAP) | y/bb | 1,504.75 |  | 1,443.92 |  | 1,297.00 |  |  |  |
Efficiency ratio |  |  |  |  |  |  |
Net interest income | cc | $ | 1,796 |  | $ | 1,821 |  | $ | 1,990 |  |  | $ | 5,434 |  | $ | 4,801 |
Efficiency ratio (GAAP) | j / (h + cc) | 59.49 | % | 56.36 | % | 54.34 | % |  | 57.38 | % | 23.53 | %
Adjusted efficiency ratio (non-GAAP) | k / (i + cc) | 54.15 |  | 50.77 |  | 46.04 |  |  | 51.72 | % | 49.85 | %
Rental income on operating lease equipment |  |  |  |  |  |  |
Rental income on operating lease equipment (GAAP) |  | $ | 262 |  | $ | 259 |  | $ | 248 |  |  | $ | 776 |  | $ | 719 |
Less: depreciation on operating lease equipment |  | 99 |  | 98 |  | 95 |  |  | 293 |  | 275 |
Less: maintenance and other operating lease expenses |  | 59 |  | 60 |  | 51 |  |  | 164 |  | 163 |
Adjusted rental income on operating lease equipment (non-GAAP) |  | $ | 104 |  | $ | 101 |  | $ | 102 |  |  | $ | 319 |  | $ | 281 |
Net interest income & Net interest margin |  |  |  |  |  |  |
Net interest income (GAAP) | cc | $ | 1,796 |  | $ | 1,821 |  | $ | 1,990 |  |  | $ | 5,434 |  | $ | 4,801 |
Loan PAA income | dd | 107 |  | 145 |  | 275 |  |  | 415 |  | 535 |
Other PAA (expense) income | ee | (6) |  | (5) |  | (6) |  |  | (16) |  | 11 |
Total PAA | ff = (dd + ee) | $ | 101 |  | $ | 140 |  | $ | 269 |  |  | $ | 399 |  | $ | 546 |
Net interest income, excluding PAA (non-GAAP) | gg = (cc - ff) | $ | 1,695 |  | $ | 1,681 |  | $ | 1,721 |  |  | $ | 5,035 |  | $ | 4,255 |
Annualized net interest income (GAAP) | hh = cc annualized | $ | 7,147 |  | $ | 7,322 |  | $ | 7,894 |  |  | $ | 7,259 |  | $ | 6,418 |
Annualized net interest income, excluding PAA (non-GAAP) | ii = ee annualized | 6,746 |  | 6,760 |  | 6,829 |  |  | 6,726 |  | 5,689 |
Average interest-earning assets | jj | 202,199 |  | 200,705 |  | 193,720 |  |  | 200,503 |  | 162,183 |
NIM (GAAP) | hh/jj | 3.53 | % | 3.64 | % | 4.07 | % |  | 3.62 | % | 3.95 | %
NIM, excluding PAA (non-GAAP) | ii/jj | 3.33 |  | 3.36 |  | 3.52 |  |  | 3.35 |  | 3.50 |
Note: Certain items above do not precisely recalculate as presented due to rounding.