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Fair Value Measurement
 9 Months Ended
Sep. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurement Fair Value Measurement
 
The following table presents estimated fair values of the Company's financial instruments as of the dates presented, whether or not recognized or recorded at fair value on a recurring basis in the Condensed Consolidated Balance Sheets:
September 30, 2025December 31, 2024
(in millions)
LevelCarrying ValueFair ValueCarrying ValueFair Value
Financial assets:    
Cash and cash equivalents1$2,343 $2,343 $1,879 $1,879 
Equity and other investment securities1,2112 112 78 78 
Investment securities available for sale1,211,013 11,013 8,275 8,275 
Investment securities held to maturity318 18 2 3 
Loans held for sale2340 340 72 72 
Loans and leases, net (1)
2,347,989 46,715 37,256 35,690 
Restricted equity securities1119 119 150 150 
Residential mortgage servicing rights3101 101 108 108 
Derivatives2,388 88 109 109 
Financial liabilities:    
Deposits255,771 55,759 41,721 41,707 
Securities sold under agreements to repurchase2167 167 237 237 
Borrowings22,300 2,300 3,100 3,102 
Junior subordinated debentures, at fair value3331 331 331 331 
Junior and other subordinated debentures, at amortized cost3107 108 108 104 
Derivatives1,2,3194 194 281 281 

(1) Loans and leases, net are classified as level 3, with the exception of loans originated as held for sale and transferred into loans held for investment of $76 million and $169 million as of September 30, 2025 and December 31, 2024, respectively, which are classified as level 2.
Fair Value of Assets and Liabilities Measured on a Recurring Basis 

The following tables present information about the Company's assets and liabilities measured at fair value on a recurring basis as of the periods presented: 
(in millions) 
September 30, 2025
DescriptionTotalLevel 1Level 2Level 3
Financial assets:
Equity and other investment securities    
Investments in mutual funds and other securities$92 $61 $31 $— 
Equity securities held in rabbi trusts20 20 — — 
Investment securities available for sale    
U.S. Treasury and agencies1,295 208 1,087 — 
Obligations of states and political subdivisions1,637 — 1,637 — 
Mortgage-backed securities and collateralized mortgage obligations8,081 — 8,081 — 
Loans held for sale, at fair value340 — 340 — 
Loans and leases, at fair value76 — 76 — 
Residential mortgage servicing rights, at fair value101 — — 101 
Derivatives    
Interest rate swaps88 — 88 — 
Total assets measured at fair value$11,730 $289 $11,340 $101 
Financial liabilities:
Junior subordinated debentures, at fair value$331 $— $— $331 
Derivatives    
Interest rate futures1 1 — — 
Interest rate swaps193 — 193 — 
Total liabilities measured at fair value$525 $1 $193 $331 
(in millions) December 31, 2024
DescriptionTotalLevel 1Level 2Level 3
Financial assets:
Equity and other investment securities    
Investments in mutual funds and other securities$62 $44 $18 $— 
Equity securities held in rabbi trusts
16 16 — — 
Investment securities available for sale
U.S. Treasury and agencies1,423 321 1,102 — 
Obligations of states and political subdivisions1,026 — 1,026 — 
Mortgage-backed securities and collateralized mortgage obligations5,826 — 5,826 — 
Loans held for sale, at fair value72 — 72 — 
Loans and leases, at fair value169 — 169 — 
Residential mortgage servicing rights, at fair value108 — — 108 
Derivatives    
Interest rate forward sales commitments1 — 1 — 
Interest rate swaps107 — 107 — 
Foreign currency derivatives1 — 1 — 
Total assets measured at fair value$8,811 $381 $8,322 $108 
Financial liabilities:
Junior subordinated debentures, at fair value$331 $— $— $331 
Derivatives    
Interest rate futures3 — 3 — 
Interest rate swaps277 — 277 — 
Foreign currency derivatives1 — 1 — 
Total liabilities measured at fair value$612 $— $281 $331 

The following methods were used to estimate the fair value of each class of financial instrument that is carried at fair value in the tables above: 
 
Securities— Fair values for investment securities are based on quoted market prices when available or through the use of alternative approaches, such as matrix or model pricing, or broker indicative bids, when market quotes are not readily accessible or available. Management periodically reviews the pricing information received from the third-party pricing service and compares it to a secondary pricing service, evaluating significant price variances between services to determine an appropriate estimate of fair value to report.
 
Loans Held for Sale— Fair value for residential mortgage loans originated as held for sale is determined based on quoted secondary market prices for similar loans, including the implicit fair value of embedded servicing rights. For loans not originated as held for sale, these loans are accounted for at lower of cost or market, with the fair value estimated based on the expected sales price.

Loans and leases— Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated by type, including commercial, real estate, and consumer loans. Each loan category is further segregated by fixed and adjustable-rate loans. The fair value of loans is calculated by discounting expected cash flows at rates at which similar loans are currently being made. This model is periodically validated by an independent model validation group. These amounts are discounted further by embedded probable losses expected to be realized in the portfolio. For loans originated as held for sale and transferred into loans held for investment, the fair value is determined based on quoted secondary market prices for similar loans.
Residential Mortgage Servicing Rights— The fair value of MSR is estimated using a DCF model. Assumptions used include market discount rates, anticipated prepayment speeds, delinquency and foreclosure rates, and ancillary fee income net of servicing costs. This model is periodically validated by an independent model validation group. The model assumptions and the MSR fair value estimates are also compared to observable trades of similar portfolios as well as to MSR broker valuations and industry surveys, as available. Management believes the significant inputs utilized are indicative of those that would be used by market participants. The amount of contractually specified servicing fees, late fees, and ancillary fees earned, which is recorded in residential mortgage banking revenue, was $5 million and $17 million for the three and nine months ended September 30, 2025, respectively, as compared to $6 million and $18 million for the three and nine months ended September 30, 2024, respectively.
 
Junior Subordinated Debentures— The fair value of junior subordinated debentures is estimated using an income approach valuation technique. The significant unobservable input utilized in the estimation of fair value of these instruments is the credit risk adjusted spread. The credit risk adjusted spread represents the non-performance risk of the liability, contemplating the inherent risk of the obligation. The Company periodically utilizes a valuation firm to determine or validate the reasonableness of inputs and factors that are used to determine the fair value. The ending carrying (fair) value of the junior subordinated debentures measured at fair value represents the estimated amount that would be paid to transfer these liabilities in an orderly transaction among market participants. Due to credit concerns in the capital markets and inactivity in the trust preferred markets that have limited the observability of market spreads, the Company has classified this as a Level 3 fair value measurement.
 
Derivative Instruments— Derivatives include interest rate swaps, forward sales commitments, foreign currency derivatives, interest rate futures, and interest rate lock commitments. The fair values of these instruments generally fluctuate with changes in market interest rates. Interest rate swaps, forward sales commitments, and foreign currency derivatives are valued using dealer quotes and secondary market sources, and are classified as Level 2 fair value measurements. Interest rate futures are exchange-traded derivatives, valued at fair value using quoted settlement prices from the exchange, and are classified as Level 1. Interest rate lock commitments use a pull-through rate that is considered an unobservable input, so these are classified as Level 3 fair value measurements.

Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) 
 
The following table provides a description of the valuation technique, significant unobservable inputs, and qualitative information about the unobservable inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a recurring basis as of the dates presented: 
Financial Instrument
Fair Value
(in millions)
Valuation TechniqueUnobservable InputRange of InputsWeighted Average
September 30, 2025
Assets:
Residential mortgage servicing rights$101 Discounted cash flowConstant prepayment rate
5.77% - 31.32%
7.94%
  Discount rate
9.50% - 16.26%
10.20%
Liabilities:
Junior subordinated debentures$331 Discounted cash flowCredit spread
2.12% - 4.28%
3.08%
Financial Instrument
Fair Value
(in millions)
Valuation TechniqueUnobservable InputRange of InputsWeighted Average
December 31, 2024
Assets:
Residential mortgage servicing rights$108 Discounted cash flowConstant prepayment rate
5.77% - 60.85%
6.92%
Discount rate
9.50% - 16.16%
10.23%
Liabilities:
Junior subordinated debentures$331 Discounted cash flowCredit spread
1.46% - 4.15%
3.06%
Generally, increases in the constant prepayment rate or the discount rate utilized in the fair value measurement of the residential mortgage servicing rights will result in a decrease in fair value. Conversely, decreases in the constant prepayment rate or the discount rate will result in an increase in fair value.

Management believes that the credit risk adjusted spread utilized in the fair value measurement of the junior subordinated debentures carried at fair value is indicative of the non-performance risk premium a willing market participant would require under current market conditions, which is an inactive market. Generally, an increase in the credit spread will result in a decrease in the estimated fair value. Conversely, a decrease in the credit spread will result in an increase in the estimated fair value.

The following table provides a reconciliation of assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis for the periods indicated: 
Three Months Ended
September 30, 2025September 30, 2024
(in millions)
Residential Mortgage Servicing Rights
Junior Subordinated Debentures, at Fair Value
Residential Mortgage Servicing Rights
Junior Subordinated Debentures, at Fair Value
Beginning balance$103 $(323)$110 $(310)
Change included in earnings(3)(7)(9)(8)
Change in fair values included in comprehensive income/loss— (8)— (2)
Purchases and issuances1 — 1 — 
Sales and settlements— 7 — 8 
Ending balance$101 $(331)$102 $(312)
Change in unrealized gains or losses for the period included in earnings for assets and liabilities held at end of period$— $(7)$(6)$(8)
Change in unrealized gains or losses for the period included in other comprehensive income for assets and liabilities held at end of period$— $(8)$— $(2)
Nine Months Ended
September 30, 2025September 30, 2024
(in millions)
Residential Mortgage Servicing Rights
Junior Subordinated Debentures, at Fair Value
Residential Mortgage Servicing Rights
Junior Subordinated Debentures, at Fair Value
Beginning balance$108 $(331)$109 $(316)
Change included in earnings(12)(20)(11)(23)
Change in fair values included in comprehensive income/loss— — — 4 
Purchases and issuances5 — 4 — 
Sales and settlements— 20 — 23 
Ending balance$101 $(331)$102 $(312)
Change in unrealized gains or losses for the period included in earnings for assets held at end of period$(3)$(20)$(2)$(23)
Change in unrealized gains or losses for the period included in other comprehensive income for assets held at end of period$— $— $— $4 
Changes in residential mortgage servicing rights carried at fair value are recorded in residential mortgage banking revenue within non-interest income. Gains (losses) on interest rate lock commitments carried at fair value are recorded in residential mortgage banking revenue within non-interest income.

The contractual interest expense on the junior subordinated debentures is recorded on an accrual basis as interest on junior subordinated debentures within interest expense. Settlements related to the junior subordinated debentures represent the payment of accrued interest that is embedded in the fair value of these liabilities. The change in fair value of junior subordinated debentures is attributable to the change in the instrument specific credit risk; accordingly, the unrealized losses of $8 million for the three months ended September 30, 2025 were recorded net of tax as other comprehensive losses of $6 million. There was no impact for the nine months ended September 30, 2025. Comparatively, unrealized losses of $2 million and unrealized gains of $4 million were recorded net of tax as other comprehensive losses of $1 million and gains of $3 million for the three and nine months ended September 30, 2024, respectively. The change recorded for the three months ended September 30, 2025 was mainly due to changes in swap rates and credit spreads.

Fair Value of Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis 

From time to time, certain assets are measured at fair value on a nonrecurring basis. These adjustments to fair value generally result from the application of lower-of-cost-or-market accounting or write-downs of individual assets due to impairment, typically on collateral-dependent loans. The following tables present information about the Company's assets and liabilities measured at fair value on a nonrecurring basis for which a nonrecurring change in fair value was recorded during the reporting period. The amounts disclosed below represent the fair values at the time the nonrecurring fair value measurements were made, and not necessarily the fair value as of the dates reported upon. 
September 30, 2025
(in millions) 
TotalLevel 1Level 2Level 3
Loans and leases$17 $— $— $17 

December 31, 2024
(in millions) 
TotalLevel 1Level 2Level 3
Loans and leases$28 $— $— $28 

The following table presents the losses resulting from nonrecurring fair value adjustments for the periods indicated:

Three Months EndedNine Months Ended
(in millions) 
September 30, 2025September 30, 2024September 30, 2025September 30, 2024
Loans and leases$17 $25 $72 $84 

The following provides a description of the valuation technique and inputs for the Company's assets and liabilities classified as Level 3 and measured at fair value on a nonrecurring basis. Unobservable inputs and qualitative information about the unobservable inputs are not presented as the fair value is determined by third-party information for loans and leases.

The loans and leases amounts above represent collateral-dependent loans and leases that have been adjusted to fair value. When a loan or non-homogeneous lease is identified as collateral-dependent, the Bank measures the impairment using the current fair value of the collateral, less estimated selling costs. Depending on the characteristics of a loan or lease, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases the value of the collateral may be estimated as having little to no value. When a homogeneous lease or equipment finance agreement becomes 181 days past due, it is determined that the collateral has little to no value. If it is determined that the value of the collateral-dependent loan or lease is less than its recorded investment, the Bank recognizes this impairment and adjusts the carrying value of the loan or lease to fair value, less costs to sell, through the ACL. The loss represents charge-offs on collateral-dependent loans and leases for fair value adjustments based on the fair value of collateral.
Fair Value Option
The following table presents the difference between the aggregate fair value and the aggregate unpaid principal balance of loans held for sale and loans held for investment accounted for under the fair value option as of the dates presented:
September 30, 2025December 31, 2024
(in millions)Fair Value Aggregate Unpaid Principal BalanceFair Value Less Aggregate Unpaid Principal BalanceFair ValueAggregate Unpaid Principal BalanceFair Value Less Aggregate Unpaid Principal Balance
Loans held for sale$340 $357 $(17)$72 $71 $1 
Loans held for investment$76 $81 $(5)$169 $201 $(32)

The Bank elected to measure certain residential mortgage loans held for sale under the fair value option, with interest income on these loans held for sale reported in interest and fees on loans and leases on the Condensed Consolidated Statements of Income. This reduces certain timing differences and better matches changes in the value of these assets with changes in the value of derivatives used as economic hedges for these assets. Residential mortgage loans held for sale accounted for under the fair value option are measured initially at fair value with subsequent changes in fair value recognized in earnings. Gains and losses from such changes in fair value are reported as a component of residential mortgage banking revenue. For the three and nine months ended September 30, 2025, the Company recorded no net change in fair value and a net increase in fair value of $1 million, respectively. For the three and nine months ended September 30, 2024, the Company recorded a net increase in fair value of $1 million and $1 million, respectively.

Management's intent to sell certain residential mortgage loans classified as held for sale may change over time due to factors including changes in overall market liquidity or changes in characteristics specific to certain loans held for sale. Consequently, these loans may be reclassified as loans held for investment and maintained in the Bank's loan portfolio. In the event that loans currently classified as held for sale are reclassified as loans held for investment, the loans will continue to be measured at fair value. Gains and losses from changes in fair value for these loans are reported in earnings as a component of other income and interest income on these loans are reported in interest and fees on loans and leases on the Condensed Consolidated Statements of Income. For the three and nine months ended September 30, 2025, the Company recorded a net increase in fair value of $4 million and $11 million, respectively, as compared to a net decrease in fair value of $9 million and $3 million for the three and nine months ended September 30, 2024, respectively.

The Company selected the fair value measurement option for certain junior subordinated debentures originally issued by Umpqua Holdings Corporation prior to its merger with Columbia (the Umpqua Statutory Trusts) and for junior subordinated debentures acquired by Umpqua Holdings Corporation from Sterling Financial Corporation prior to Umpqua Holdings Corporation's merger with Columbia, with changes in fair value recognized as a component of other comprehensive income. The remaining junior subordinated debentures were acquired through business combinations and were measured at fair value at the time of acquisition and subsequently measured at amortized cost.