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Strategic Lines of Business | 9 Months Ended
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Sep. 30, 2023
Segment Reporting [Abstract] |
Strategic Lines of Business | STRATEGIC LINES OF BUSINESS The Corporation has strategically aligned its operations into three major business segments: the Commercial Bank, the Retail Bank and Wealth Management. These business segments are differentiated based on the type of customer and the related products and services provided. In addition to the three major business segments, the Finance Division is also reported as a segment. Business segment results are produced by the Corporation’s internal management accounting system. This system measures financial results based on the internal business unit structure of the Corporation. The performance of the business segments is not comparable with the Corporation's consolidated results and is not necessarily comparable with similar information for any other financial institution. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. The management accounting system assigns balance sheet and income statement items to each business segment using certain methodologies, which are regularly reviewed and refined. From time to time, the Corporation may make reclassifications among the segments to more appropriately reflect management's current view of the segments, and methodologies may be modified as the management accounting system is enhanced and changes occur in the organizational structure and/or product lines. For comparability purposes, amounts in all periods are based on business unit structure and methodologies in effect at September 30, 2023. The following discussion provides information about the activities of each business segment. A discussion of the financial results and the factors impacting performance can be found in "Business Segments" in the "Strategic Lines of Business" section of the financial review. The Commercial Bank meets the needs of small and middle market businesses, multinational corporations and governmental entities by offering various products and services including commercial loans and lines of credit, deposits, cash management, capital market products, international trade finance, letters of credit, foreign exchange management services and loan syndication services. The Retail Bank includes a full range of personal financial services, consisting of consumer lending, consumer deposit gathering and mortgage loan origination. This business segment offers a variety of consumer products including deposit accounts, installment loans, credit cards, student loans, home equity lines of credit and residential mortgage loans. In addition, this business segment offers a subset of commercial products and services to micro-businesses whose primary contact is through the branch network. Wealth Management offers products and services consisting of fiduciary services, private banking, retirement services, investment management and advisory services, investment banking and brokerage services. This business segment also offers the sale of annuity products, as well as life, disability and long-term care insurance products. The Finance segment includes the Corporation’s securities portfolio and asset and liability management activities. This segment is responsible for managing the Corporation’s funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage the Corporation’s exposure to liquidity, interest rate risk and foreign exchange risk. The Other category includes the income and expense impact of equity and cash, tax benefits not assigned to specific business segments, charges of an unusual or infrequent nature that are not reflective of the normal operations of the business segments and miscellaneous other expenses of a corporate nature. For further information on the methodologies which form the basis for these results refer to Note 22 to the consolidated financial statements in the Corporation's 2022 Annual Report. Business segment financial results were as follows:
| Commercial Bank |  | Retail Bank |  | Wealth Management |  | Finance |  | Other |  | Total
(dollar amounts in millions) |  |  |  |  |
Three Months Ended September 30, 2023 |  |  |  |  |  |  |  |  |  |  |
Earnings summary: |  |  |  |  |  |  |  |  |  |  |
Net interest income (expense) | $ | 505 |  |  | $ | 208 |  |  | $ | 49 |  |  | $ | (187) |  |  | $ | 26 |  |  | $ | 601 |
Provision for credit losses | 22 |  |  | — |  |  | (9) |  |  | — |  |  | 1 |  |  | 14 |
Noninterest income | 150 |  |  | 31 |  |  | 78 |  |  | 40 |  |  | (4) |  |  | 295 |
Noninterest expenses | 257 |  |  | 175 |  |  | 102 |  |  | 1 |  |  | 20 |  |  | 555 |
Provision (benefit) for income taxes | 89 |  |  | 16 |  |  | 9 |  |  | (37) |  |  | (1) |  |  | 76 |
Net income (loss) | $ | 287 |  |  | $ | 48 |  |  | $ | 25 |  |  | $ | (111) |  |  | $ | 2 |  |  | $ | 251 |
Net charge-offs | $ | 6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 6 |
Selected average balances: |  |  |  |  |  |  |  |  |  |  |
Assets | $ | 49,459 |  |  | $ | 2,985 |  |  | $ | 5,557 |  |  | $ | 19,832 |  |  | $ | 11,317 |  |  | $ | 89,150 |
Loans | 46,477 |  |  | 2,250 |  |  | 5,227 |  |  | — |  |  | 33 |  |  | 53,987 |
Deposits | 31,868 |  |  | 24,034 |  |  | 3,950 |  |  | 5,711 |  |  | 320 |  |  | 65,883 |
Statistical data: |  |  |  |  |  |  |  |  |  |  |
Return on average assets (a) | 2.30 | % |  | 0.78 | % |  | 1.81 | % |  | n/m |  | n/m |  | 1.12 | %
Efficiency ratio (b) | 39.34 |  |  | 72.70 |  |  | 80.01 |  |  | n/m |  | n/m |  | 61.86 |
Three Months Ended September 30, 2022 |  |  |  |  |  |  |  |  |  |  |
Earnings summary: |  |  |  |  |  |  |  |  |  |  |
Net interest income (expense) | $ | 478 |  |  | $ | 188 |  |  | $ | 55 |  |  | $ | (22) |  |  | $ | 8 |  |  | $ | 707 |
Provision for credit losses | 16 |  |  | 2 |  |  | 5 |  |  | — |  |  | 5 |  |  | 28 |
Noninterest income | 169 |  |  | 29 |  |  | 77 |  |  | 6 |  |  | (3) |  |  | 278 |
Noninterest expenses | 242 |  |  | 170 |  |  | 87 |  |  | — |  |  | 3 |  |  | 502 |
Provision (benefit) for income taxes | 94 |  |  | 11 |  |  | 10 |  |  | (6) |  |  | (5) |  |  | 104 |
Net income (loss) | $ | 295 |  |  | $ | 34 |  |  | $ | 30 |  |  | $ | (10) |  |  | $ | 2 |  |  | $ | 351 |
Net charge-offs | $ | 13 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 13 |
Selected average balances: |  |  |  |  |  |  |  |  |  |  |
Assets | $ | 48,323 |  |  | $ | 2,799 |  |  | $ | 5,097 |  |  | $ | 22,140 |  |  | $ | 7,063 |  |  | $ | 85,422 |
Loans | 44,043 |  |  | 2,066 |  |  | 4,973 |  |  | — |  |  | 31 |  |  | 51,113 |
Deposits | 41,471 |  |  | 26,665 |  |  | 5,293 |  |  | 144 |  |  | 403 |  |  | 73,976 |
Statistical data: |  |  |  |  |  |  |  |  |  |  |
Return on average assets (a) | 2.42 | % |  | 0.51 | % |  | 2.08 | % |  | n/m |  | n/m |  | 1.63 | %
Efficiency ratio (b) | 37.54 |  |  | 77.00 |  |  | 65.86 |  |  | n/m |  | n/m |  | 50.75 |
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. (b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities, a derivative contract tied to the conversion rate of Visa Class B shares and changes in the value of shares obtained through monetization of warrants. n/m – not meaningful
(dollar amounts in millions) | Commercial Bank |  | Retail Bank |  | Wealth Management |  | Finance |  | Other |  | Total
Nine Months Ended September 30, 2023
Earnings summary: |  |  |  |  |  |  |  |  |  |  |
Net interest income (expense) | $ | 1,550 |  |  | $ | 644 |  |  | $ | 158 |  |  | $ | (493) |  |  | $ | 71 |  |  | $ | 1,930 |
Provision for credit losses | 80 |  |  | 2 |  |  | (9) |  |  | — |  |  | 4 |  |  | 77 |
Noninterest income | 460 |  |  | 89 |  |  | 233 |  |  | 93 |  |  | 5 |  |  | 880 |
Noninterest expenses | 757 |  |  | 511 |  |  | 297 |  |  | 4 |  |  | 72 |  |  | 1,641 |
Provision (benefit) for income taxes | 270 |  |  | 53 |  |  | 25 |  |  | (101) |  |  | (3) |  |  | 244 |
Net income (loss) | $ | 903 |  |  | $ | 167 |  |  | $ | 78 |  |  | $ | (303) |  |  | $ | 3 |  |  | $ | 848 |
Net charge-offs | $ | 1 |  |  | $ | — |  |  | $ | 1 |  |  | $ | — |  |  | $ | — |  |  | $ | 2 |
Selected average balances: |  |  |  |  |  |  |  |  |  |  |
Assets | $ | 49,906 |  |  | $ | 2,944 |  |  | $ | 5,510 |  |  | $ | 20,469 |  |  | $ | 9,400 |  |  | $ | 88,229 |
Loans | 46,797 |  |  | 2,223 |  |  | 5,256 |  |  | — |  |  | — |  |  | 54,276 |
Deposits | 33,204 |  |  | 24,394 |  |  | 4,200 |  |  | 3,858 |  |  | 353 |  |  | 66,009 |
Statistical data: |  |  |  |  |  |  |  |  |  |  |
Return on average assets (a) | 2.42 | % |  | 0.89 | % |  | 1.92 | % |  | n/m |  | n/m |  | 1.29 | %
Efficiency ratio (b) | 37.64 |  |  | 69.23 |  |  | 75.70 |  |  | n/m |  | n/m |  | 58.26 |
Nine Months Ended September 30, 2022 |  |  |  |  |  |  |  |  |  |  |
Earnings summary: |  |  |  |  |  |  |  |  |  |  |
Net interest income (expense) | $ | 1,232 |  |  | $ | 464 |  |  | $ | 138 |  |  | $ | (118) |  |  | $ | 8 |  |  | $ | 1,724 |
Provision for credit losses | 1 |  |  | 7 |  |  | 11 |  |  | — |  |  | 8 |  |  | 27 |
Noninterest income | 461 |  |  | 89 |  |  | 226 |  |  | 36 |  |  | (22) |  |  | 790 |
Noninterest expenses | 712 |  |  | 508 |  |  | 259 |  |  | — |  |  | (22) |  |  | 1,457 |
Provision (benefit) for income taxes | 229 |  |  | 9 |  |  | 23 |  |  | (25) |  |  | (7) |  |  | 229 |
Net income (loss) | $ | 751 |  |  | $ | 29 |  |  | $ | 71 |  |  | $ | (57) |  |  | $ | 7 |  |  | $ | 801 |
Net charge-offs (recoveries) | $ | 24 |  |  | $ | (1) |  |  | $ | (2) |  |  | $ | — |  |  | $ | — |  |  | $ | 21 |
Selected average balances: |  |  |  |  |  |  |  |  |  |  |
Assets | $ | 46,992 |  |  | $ | 2,791 |  |  | $ | 4,974 |  |  | $ | 20,831 |  |  | $ | 12,852 |  |  | $ | 88,440 |
Loans | 42,928 |  |  | 2,031 |  |  | 4,841 |  |  | — |  |  | 15 |  |  | 49,815 |
Deposits | 43,733 |  |  | 26,890 |  |  | 5,520 |  |  | 300 |  |  | 428 |  |  | 76,871 |
Statistical data: |  |  |  |  |  |  |  |  |  |  |
Return on average assets (a) | 2.07 | % |  | 0.15 | % |  | 1.61 | % |  | n/m |  | n/m |  | 1.21 | %
Efficiency ratio (b) | 41.95 |  |  | 90.82 |  |  | 71.08 |  |  | n/m |  | n/m |  | 57.67 |
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity. (b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities, a derivative contract tied to the conversion rate of Visa Class B shares and changes in the value of shares obtained through monetization of warrants. n/m – not meaningful

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