ALLOWANCE FOR LOAN AND LEASE LOSSES

12 Months Ended

Dec. 31, 2025

NOTE 6 — ALLOWANCE FOR LOAN AND LEASE LOSSES

The ALLL is reported as a separate line item on the Consolidated Balance Sheets, while the reserve for off-balance sheet credit exposure of $260 million and $278 million, at December 31, 2025 and December 31, 2024, respectively, is included in other liabilities. The provision or benefit for credit losses related to (i) loans and leases (ii) off-balance sheet credit exposure, and (iii) other receivables or investment securities available for sale, if any, is reported in the Consolidated Statements of Income as provision or benefit for credit losses.

The Initial PCD ALLL for the SVBB Acquisition was established through a PCD Gross-Up and there was no corresponding increase to the provision for credit losses. The PCD Gross-Up is discussed in Note 1—Significant Accounting Policies and Basis of Presentation.

The initial ALLL for Non-PCD loans and leases acquired in the SVBB Acquisition was established through a corresponding increase to the Day 2 Provision for Loan and Lease Losses.

The ALLL activity for loans and leases is summarized in the following table:

Allowance for Loan and Lease Losses


dollars in millions	Year Ended December 31, 2025				Year Ended December 31, 2024						Year Ended December 31, 2023
	Commercial		Consumer		Total		Commercial		Consumer			Total		Commercial		Consumer		Total
Balance at beginning of period	$	1,518	$	158	$	1,676	$	1,581	$	166		$	1,747	$	789	$	133	$	922
Initial PCD ALLL	—		—		—		—		—			—		217		3		220
Day 2 Provision for Loan and Lease Losses	—		—		—		—		—			—		419		43		462
Provision (benefit) for loan and lease losses	538		(8)		530		461		8			469		701		2		703
Total provision (benefit) for loan and lease losses	538		(8)		530		461		8			469		1,120		45		1,165
Charge-offs	(708)		(33)		(741)		(627)		(30)			(657)		(610)		(28)		(638)
Recoveries	88		13		101		103		14			117		65		13		78

Balance at end of period	$	1,436	$	130	$	1,566	$	1,518	$	158		$	1,676	$	1,581	$	166	$	1,747

The decrease of $110 million in the ALLL at December 31, 2025 compared to December 31, 2024, mainly driven by loan growth concentrated in capital call lines which have a lower loss rate relative to our other loan portfolios, elimination of the reserves related to Hurricane Helene, a modest shift in our weighting from the downside to baseline economic scenario, improvements in the economic outlook and credit quality, and lower specific reserves for individually evaluated loans. Also, during the year ended December 31, 2025, we updated our PD, LGD, and exposure at default methodology for certain portfolios which contributed to changes in the ALLL compared to prior periods.

The following table presents the components of the provision for credit losses:

Provision for Credit Losses


dollars in millions	Year Ended December 31,
	2025		2024		2023
Day 2 Provision for Loan and Lease Losses	$	—	$	—	$	462
Provision for loan and lease losses	530		469		703
Total provision for loan and lease losses	530		469		1,165
Day 2 Provision for Off-Balance Sheet Credit Exposure	—		—		254
Benefit for off-balance sheet credit exposure	(18)		(38)		(44)
Total (benefit) provision for off-balance sheet credit exposure	(18)		(38)		210
Provision for other receivables	2		—		—
Provision for credit losses	$	514	$	431	$	1,375