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INVESTMENT SECURITIES | 6 Months Ended
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Jun. 30, 2025
Investments [Abstract] |
INVESTMENT SECURITIES | INVESTMENT SECURITIES Investment Securities We classify our investment securities as either available-for-sale (“AFS”) or held-to-maturity (“HTM”). AFS securities, which primarily consist of debt securities used to manage liquidity and interest rate risk and to generate interest income, are measured at fair value. Unrealized gains and losses from AFS securities, net of applicable taxes, are recorded in other comprehensive income. HTM securities are those that management has both the intent and ability to hold until maturity and are carried at amortized cost. This amount reflects the original investment cost, adjusted for the amortization or accretion of any purchase premiums or discounts, as well as any impairment losses, including credit-related impairment. Gains or losses on the sale of investment securities are recognized in noninterest income using the specific identification method. The carrying values of our investment securities exclude accrued interest receivables of $62 million and $60 million at June 30, 2025 and December 31, 2024, respectively. These receivables are included in “Other assets” on the consolidated balance sheet. Investment securities with a carrying value of $17.7 billion and $17.9 billion were pledged as collateral for potential borrowings at June 30, 2025 and December 31, 2024, respectively. When a security is transferred from AFS to HTM, the difference between its amortized cost basis and fair value at the date of transfer is amortized as a yield adjustment through interest income. The fair value at the date of transfer results in either a premium or discount to the amortized cost basis of the HTM securities. The amortization of unrealized gains or losses reported in accumulated other comprehensive income (“AOCI”) will offset the effect of the amortization of the premium or discount in interest income created by the transfer. The discount associated with securities previously transferred from AFS to HTM was $1.7 billion ($1.3 billion after tax) at June 30, 2025, compared with $1.8 billion ($1.4 billion after tax) at December 31, 2024. For additional information regarding our fair value estimation process and the accounting treatment of our investment securities, see Notes 3 and 5, respectively, of our 2024 Form 10-K. The following schedule presents the amortized cost and estimated fair values of our AFS and HTM securities:
| June 30, 2025
(In millions) | Amortized cost |  | Gross unrealized gains 1 |  | Gross unrealized losses |  | Estimated fair value
Available-for-sale |  |  |  |  |  |  |
U.S. Treasury securities | $ | 1,201 |  |  | $ | 10 |  |  | $ | 110 |  |  | $ | 1,101 |
U.S. Government agencies and corporations: |  |  |  |  |  |  |
Agency securities | 376 |  |  | — |  |  | 20 |  |  | 356 |
Agency guaranteed mortgage-backed securities | 7,302 |  |  | 2 |  |  | 1,090 |  |  | 6,214 |
Small Business Administration loan-backed securities | 400 |  |  | — |  |  | 16 |  |  | 384 |
Municipal securities | 1,102 |  |  | — |  |  | 66 |  |  | 1,036 |
Other debt securities | 25 |  |  | — |  |  | — |  |  | 25 |
Total available-for-sale | 10,406 |  |  | 12 |  |  | 1,302 |  |  | 9,116 |
Held-to-maturity |  |  |  |  |  |  |
U.S. Government agencies and corporations: |  |  |  |  |  |  |
Agency securities | 143 |  |  | — |  |  | 5 |  |  | 138 |
Agency guaranteed mortgage-backed securities | 8,843 |  |  | 49 |  |  | 73 |  |  | 8,819 |
Municipal securities | 286 |  |  | — |  |  | 14 |  |  | 272 |
Total held-to-maturity | 9,272 |  |  | 49 |  |  | 92 |  |  | 9,229 |
Total investment securities | $ | 19,678 |  |  | $ | 61 |  |  | $ | 1,394 |  |  | $ | 18,345 |
| December 31, 2024
(In millions) | Amortized cost |  | Gross unrealized gains 1 |  | Gross unrealized losses |  | Estimated fair value
Available-for-sale |  |  |  |  |  |  |
U.S. Treasury securities | $ | 781 |  |  | $ | — |  |  | $ | 119 |  |  | $ | 662 |
U.S. Government agencies and corporations: |  |  |  |  |  |  |
Agency securities | 441 |  |  | — |  |  | 26 |  |  | 415 |
Agency guaranteed mortgage-backed securities | 7,713 |  |  | 1 |  |  | 1,263 |  |  | 6,451 |
Small Business Administration loan-backed securities | 455 |  |  | — |  |  | 21 |  |  | 434 |
Municipal securities | 1,186 |  |  | — |  |  | 78 |  |  | 1,108 |
Other debt securities | 25 |  |  | — |  |  | — |  |  | 25 |
Total available-for-sale | 10,601 |  |  | 1 |  |  | 1,507 |  |  | 9,095 |
Held-to-maturity |  |  |  |  |  |  |
U.S. Government agencies and corporations: |  |  |  |  |  |  |
Agency securities | 148 |  |  | — |  |  | 8 |  |  | 140 |
Agency guaranteed mortgage-backed securities | 9,202 |  |  | 2 |  |  | 263 |  |  | 8,941 |
Municipal securities | 319 |  |  | — |  |  | 18 |  |  | 301 |
Total held-to-maturity | 9,669 |  |  | 2 |  |  | 289 |  |  | 9,382 |
Total investment securities | $ | 20,270 |  |  | $ | 3 |  |  | $ | 1,796 |  |  | $ | 18,477 |
1 Gross unrealized gains for the respective AFS security categories without values were individually less than $1 million. The following schedule presents gross unrealized losses for AFS securities and the estimated fair value, categorized by the length of time the securities have been in an unrealized loss position:
| June 30, 2025
| Less than 12 months |  | 12 months or more |  | Total
(In millions) | Gross unrealized losses |  | Estimated fair value |  | Gross unrealized losses |  | Estimated fair value |  | Gross unrealized losses |  | Estimated fair value
Available-for-sale |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities | $ | — |  |  | $ | — |  |  | $ | 110 |  |  | $ | 291 |  |  | $ | 110 |  |  | $ | 291 |
U.S. Government agencies and corporations: |  |  |  |  |  |  |  |  |  |  |
Agency securities | — |  |  | 11 |  |  | 20 |  |  | 345 |  |  | 20 |  |  | 356 |
Agency guaranteed mortgage-backed securities | — |  |  | 12 |  |  | 1,090 |  |  | 5,977 |  |  | 1,090 |  |  | 5,989 |
Small Business Administration loan-backed securities | — |  |  | 4 |  |  | 16 |  |  | 343 |  |  | 16 |  |  | 347 |
Municipal securities | — |  |  | 51 |  |  | 66 |  |  | 904 |  |  | 66 |  |  | 955 |
Other | — |  |  | 15 |  |  | — |  |  | — |  |  | — |  |  | 15 |
Total available-for-sale investment securities | $ | — |  |  | $ | 93 |  |  | $ | 1,302 |  |  | $ | 7,860 |  |  | $ | 1,302 |  |  | $ | 7,953 |
| December 31, 2024
| Less than 12 months |  | 12 months or more |  | Total
(In millions) | Gross unrealized losses |  | Estimated fair value |  | Gross unrealized losses |  | Estimated fair value |  | Gross unrealized losses |  | Estimated fair value
Available-for-sale |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities | $ | 3 |  |  | $ | 198 |  |  | $ | 116 |  |  | $ | 285 |  |  | $ | 119 |  |  | $ | 483 |
U.S. Government agencies and corporations: |  |  |  |  |  |  |  |  |  |  |
Agency securities | — |  |  | 3 |  |  | 26 |  |  | 403 |  |  | 26 |  |  | 406 |
Agency guaranteed mortgage-backed securities | — |  |  | 86 |  |  | 1,263 |  |  | 6,171 |  |  | 1,263 |  |  | 6,257 |
Small Business Administration loan-backed securities | — |  |  | 35 |  |  | 21 |  |  | 387 |  |  | 21 |  |  | 422 |
Municipal securities | — |  |  | 68 |  |  | 78 |  |  | 984 |  |  | 78 |  |  | 1,052 |
Other | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total available-for-sale investment securities | $ | 3 |  |  | $ | 390 |  |  | $ | 1,504 |  |  | $ | 8,230 |  |  | $ | 1,507 |  |  | $ | 8,620 |
At June 30, 2025 and December 31, 2024, the number of AFS investment securities in an unrealized loss position was 2,302 and 2,534, respectively. There were no gross realized gains or losses from sales of AFS investment securities for the three and six months ended June 30, 2025 and 2024.
The following schedule presents interest income categorized by investment security type:
| Three Months Ended June 30,
| 2025 |  | 2024
(In millions) | Taxable |  | Nontaxable |  | Total |  | Taxable |  | Nontaxable |  | Total
Available-for-sale | $ | 65 |  |  | $ | 7 |  |  | $ | 72 |  |  | $ | 75 |  |  | $ | 8 |  |  | $ | 83 |
Held-to-maturity | 50 |  |  | 1 |  |  | 51 |  |  | 55 |  |  | 1 |  |  | 56 |
Total investment securities | $ | 115 |  |  | $ | 8 |  |  | $ | 123 |  |  | $ | 130 |  |  | $ | 9 |  |  | $ | 139 |
| Six Months Ended June 30,
| 2025 |  | 2024
(In millions) | Taxable |  | Nontaxable |  | Total |  | Taxable |  | Nontaxable |  | Total
Available-for-sale | $ | 130 |  |  | $ | 14 |  |  | $ | 144 |  |  | $ | 152 |  |  | $ | 16 |  |  | $ | 168 |
Held-to-maturity | 102 |  |  | 2 |  |  | 104 |  |  | 111 |  |  | 2 |  |  | 113 |
Total investment securities | $ | 232 |  |  | $ | 16 |  |  | $ | 248 |  |  | $ | 263 |  |  | $ | 18 |  |  | $ | 281 |
Maturities The following schedule presents the amortized cost and weighted average yields of debt securities, categorized by the remaining contractual maturity of principal payments at June 30, 2025. The schedule does not reflect the impact of interest rate resets or fair value hedges. Additionally, the remaining contractual principal maturities presented do not represent the portfolio's duration, as they do not incorporate expected prepayments or amortization, which generally result in measured durations that are shorter than contractual maturities.
| June 30, 2025
| Total debt securities |  | Due in one year or less |  | Due after one year through five years |  | Due after five years through ten years |  | Due after ten years
(Dollar amounts in millions) | Amortized cost |  | Average yield |  | Amortized cost |  | Average yield |  | Amortized cost |  | Average yield |  | Amortized cost |  | Average yield |  | Amortized cost |  | Average yield
Available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury securities | $ | 1,201 |  |  | 3.62 | % |  | $ | — |  |  | — | % |  | $ | 302 |  |  | 3.99 | % |  | $ | 498 |  |  | 4.42 | % |  | $ | 401 |  |  | 2.35 | %
U.S. Government agencies and corporations: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency securities | 376 |  |  | 3.09 |  |  | 40 |  |  | 2.90 |  |  | 57 |  |  | 3.44 |  |  | 172 |  |  | 2.93 |  |  | 107 |  |  | 3.23 |
Agency guaranteed mortgage-backed securities | 7,302 |  |  | 2.02 |  |  | 8 |  |  | 1.32 |  |  | 106 |  |  | 1.97 |  |  | 1,321 |  |  | 2.11 |  |  | 5,867 |  |  | 2.00 |
Small Business Administration loan-backed securities | 400 |  |  | 4.60 |  |  | 1 |  |  | 4.44 |  |  | 10 |  |  | 5.56 |  |  | 112 |  |  | 3.80 |  |  | 277 |  |  | 4.89 |
Municipal securities 1 | 1,102 |  |  | 2.26 |  |  | 147 |  |  | 3.37 |  |  | 323 |  |  | 2.41 |  |  | 612 |  |  | 1.91 |  |  | 20 |  |  | 2.33 |
Other debt securities | 25 |  |  | 8.16 |  |  | — |  |  | — |  |  | 10 |  |  | 9.51 |  |  | — |  |  | — |  |  | 15 |  |  | 7.26 |
Total available-for-sale securities | 10,406 |  |  | 2.38 |  |  | 196 |  |  | 3.19 |  |  | 808 |  |  | 3.14 |  |  | 2,715 |  |  | 2.61 |  |  | 6,687 |  |  | 2.17 |
Held-to-maturity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Government agencies and corporations: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Agency securities | 143 |  |  | 4.17 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 30 |  |  | 3.49 |  |  | 113 |  |  | 4.35 |
Agency guaranteed mortgage-backed securities | 8,843 |  |  | 1.84 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 39 |  |  | 1.86 |  |  | 8,804 |  |  | 1.84 |
Municipal securities 1 | 286 |  |  | 3.32 |  |  | 32 |  |  | 3.27 |  |  | 132 |  |  | 2.88 |  |  | 115 |  |  | 3.66 |  |  | 7 |  |  | 5.95 |
Total held-to-maturity securities | 9,272 |  |  | 1.92 |  |  | 32 |  |  | 3.27 |  |  | 132 |  |  | 2.88 |  |  | 184 |  |  | 3.25 |  |  | 8,924 |  |  | 1.87 |
Total investment securities | $ | 19,678 |  |  | 2.16 |  |  | $ | 228 |  |  | 3.21 |  |  | $ | 940 |  |  | 3.11 |  |  | $ | 2,899 |  |  | 2.65 |  |  | $ | 15,611 |  |  | 2.00 |
1 The yields on tax-exempt securities are calculated on a tax-equivalent basis. Impairment On a quarterly basis, we review our investment securities portfolio for the presence of impairment on an individual security basis. For additional information on our policy and impairment evaluation process for investment securities, see Note 5 of our 2024 Form 10-K. AFS Impairment No impairment losses were recognized on our AFS investment securities portfolio during the first six months of either 2025 or 2024. The unrealized losses primarily reflect the impact of higher interest rates following the purchase of the securities and are not attributable to credit-related factors. Accordingly, in the absence of any future sales, we expect to recover the full principal value of these securities at maturity. At June 30, 2025, we did not intend to sell any securities in an unrealized loss position, nor do we believe it is more likely than not that we would be required to sell such securities before recovering their amortized cost basis. HTM Impairment For HTM securities, the allowance for credit losses (“ACL”) is evaluated in accordance with the methodology applied to loans and leases measured at amortized cost, as described in Note 6. At June 30, 2025, the ACL on HTM securities was less than $1 million. All HTM securities were assigned a credit quality rating of “Pass,” and none were classified as past due.

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