Investment Securities

12 Months Ended

Dec. 31, 2021

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

A summary of the Corporation’s investment securities follows:


(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
December 31, 2021
Investment securities available-for-sale:
U.S. Treasury securities	$	3,010	$	22	$	39	$	2,993
Residential mortgage-backed securities (a)	13,397		67		176		13,288
Commercial mortgage-backed securities (a)	709		2		6		705
Total investment securities available-for-sale	$	17,116	$	91	$	221	$	16,986
December 31, 2020
Investment securities available-for-sale:
U.S. Treasury securities	$	4,583	$	76	$	1	$	4,658
Residential mortgage-backed securities (a)	10,169		203		2		10,370
Total investment securities available-for-sale	$	14,752	$	279	$	3	$	15,028

(a)Issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.

A summary of the Corporation’s investment securities in an unrealized loss position as of December 31, 2021 and 2020 follows:


	Less than 12 Months				12 Months or more				Total
(in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
December 31, 2021
U.S. Treasury securities	$	465	$	6	$	1,334	$	33	$	1,799	$	39
Residential mortgage-backed securities (a)	7,197		128		1,128		48		8,325		176
Commercial mortgage-backed securities (a)	346		6		—		—		346		6
Total temporarily impaired securities	$	8,008	$	140	$	2,462	$	81	$	10,470	$	221
December 31, 2020
U.S. Treasury securities	$	1,119	$	1	$	—	$	—	$	1,119	$	1
Residential mortgage-backed securities (a)	952		2		—		—		952		2
Total temporarily impaired securities	$	2,071	$	3	$	—	$	—	$	2,071	$	3

(a)Issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored enterprises.

Unrealized losses resulted from changes in market interest rates and liquidity. The Corporation’s portfolio is comprised of securities issued or guaranteed by the U.S. government or government-sponsored enterprises. As such, it is expected that the securities would not be settled at a price less than the amortized cost of the investments. Further, the Corporation does not intend to sell the investments, and it is not more-likely-than-not that it will be required to sell the the investments before recovery of amortized costs. At December 31, 2021, the Corporation had 461 securities in an unrealized loss position with no allowance for credit losses, comprised of 20 U.S. Treasury securities, 406 residential mortgage-backed securities and 35 commercial mortgage-backed securities.

Interest receivable on investment securities totaled $23 million and $18 million at December 31, 2021 and 2020 and was included in accrued income and other assets on the Consolidated Balance Sheets.

Sales, calls and write-downs of investment securities available-for-sale, primarily from repositioning $1.0 billion of lower-yielding treasury securities in the year ended December 31, 2019, resulted in the following gains and losses recorded in net securities losses on the Consolidated Statements of Income, computed based on the adjusted cost of the specific security.


(in millions)
Year Ended December 31	2021		2020		2019
Securities gains	$	—	$	1	$	1
Securities losses	—		(1)		(8)
Net securities losses	$	—	$	—	$	(7)

The following table summarizes the amortized cost and fair values of debt securities by contractual maturity. Securities with multiple maturity dates are classified in the period of final maturity. 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.


(in millions)
December 31, 2021	Amortized Cost		Fair Value
Contractual maturity
Within one year	$	170	$	172
After one year through five years	3,098		3,088
After five years through ten years	1,290		1,297
After ten years	12,558		12,429


Total investment securities	$	17,116	$	16,986

Included in the contractual maturity distribution in the table above were residential mortgage-backed securities with a total amortized cost of $13.4 billion and a fair value of $13.3 billion and commercial mortgage-backed securities with a total amortized cost of $709 million and a fair value of $705 million. The actual cash flows of mortgage-backed securities may differ as borrowers of the underlying loans may exercise prepayment options.

At December 31, 2021, investment securities with a carrying value of $2.7 billion were pledged where permitted or required by law, including $1.7 billion pledged to the Federal Home Loan Bank (FHLB) as collateral for potential future borrowings of approximately $1.6 billion and $1.0 billion to secure $946 million of liabilities, primarily public and other deposits of state and local government agencies and derivative instruments. For information on FHLB borrowings, refer to Note 12.