US BANCORP DE
For the period ended Mar 31, 2025. Filed May 6, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 6, 2025
USB$59.45-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-05.
0000036104-24-000072
Item 2. Management’s Discussion and Analysis2) Quantitative and Qualitative Disclosures About Market Risk/Corporate Risk Profile (Item 3)3) Line of Business Financial ReviewCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-06.
0000036104-25-000028
Item 2. Management’s Discussion and Analysis2) Quantitative and Qualitative Disclosures About Market Risk/Corporate Risk Profile (Item 3)3) Business Segment Financial ReviewThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 219 previous paragraphs and 207 current paragraphs.
80 unchanged; 98 reworded; 16 added; 28 removed; 13 previous and 13 current paragraphs rearranged.
Tables are not compared: 60 previous and 58 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
The provision for credit losses for the first quarter of 2025 was $16 million (2.9 percent) lower than the first quarter of 2024, driven by improved credit quality and loan portfolio mix, which contributed to a $10 million reserve release in the first quarter of 2025. Net charge-offs in the first quarter of 2025 were $547 million, compared with $488 million in the first quarter of 2024. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.
Current report
Provision for Credit Losses The provision for credit losses was $537 million in the first quarter of 2025, representing a decrease of $16 million (2.9 percent) from the first quarter of 2024, primarily driven by improved credit quality and loan portfolio mix, which contributed to a $10 million reserve release in the first quarter of 2025. Net charge-offs increased $59 million (12.1 percent) in the first quarter of 2025, compared with the first quarter of 2024, reflecting higher commercial and credit card loan net charge-offs. Refer to
Current report
million (5.1 percent) from the first quarter of 2024. The decrease in noninterest expense reflected the impact of merger and integration charges in the prior year, along with lower compensation and employee benefits expense and lower other noninterest expense, partially offset by higher marketing and business development expense and higher technology and communications expense. Compensation and employee benefits expense decreased primarily due to cost savings from operational efficiencies, partially offset by merit increases. Other noninterest expense decreased primarily due to the impact of the FDIC special assessment in the prior year. Marketing and business development expense increased primarily due to a higher charitable foundation contribution. Technology and communications expense increased primarily due to investments in infrastructure and technology development.
Current report
Credit card loans decreased $1.1 billion (3.7 percent) at March 31, 2025, compared with December 31, 2024, primarily the result of customers seasonally paying down balances.
Current report
(b)Increase in delinquent loans at March 31, 2025 reflects the impact of forbearance programs for borrowers impacted by the Los Angeles area wildfires.
Current report
The allowance for credit losses related to commercial lending segment loans decreased $39 million during the first three months of 2025, reflecting improved credit quality and portfolio mix, partially offset by commercial loan growth and increased economic uncertainty.
Current report
Net revenue decreased $112 million (3.7 percent) in the first quarter of 2025, compared with the first quarter of 2024. Net interest income, on a taxable-equivalent basis, decreased $167 million (8.7 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to the impact of deposit mix. Noninterest income increased $55 million (4.9 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to business growth and favorable market conditions across most categories.
Current report
Noninterest expense decreased $42 million (3.0 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to lower compensation and employee benefits expense. The provision for credit losses decreased $131 million (92.9 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to improved credit quality and portfolio mix.
Current report
Noninterest expense decreased $50 million (3.1 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to lower compensation and employee benefits expense. The provision for credit losses increased $8 million (14.8 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to higher net charge-offs.
Current report
Net revenue increased $97 million (5.8 percent) in the first quarter of 2025, compared with the first quarter of 2024. Net interest income, on a taxable-equivalent basis, increased $40 million (5.7 percent) in the first quarter of 2025, compared with
Current report
the first quarter of 2024, primarily due to higher loan balances and lower funding costs, partially offset by lower loan spreads. Noninterest income increased $57 million (5.8 percent) in the first quarter of 2025, compared with the first quarter of 2024, driven by business volume growth across all fee categories.
Current report
Noninterest expense increased $1 million (0.1 percent) in the first quarter of 2025, compared with the first quarter of 2024. The provision for credit losses decreased $42 million (11.7 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to improved portfolio mix and stabilizing credit quality.
Current report
Net revenue increased $395 million in the first quarter of 2025, compared with the first quarter of 2024. Net interest income, on a taxable-equivalent basis, increased $354 million (74.4 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to lower funding costs as well as benefits from the mix of earning assets and fixed asset repricing. Noninterest income increased $41 million (22.2 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to higher capital markets revenue, higher tax credit investment activity and the impact of other favorable items in other noninterest income.
Current report
Noninterest expense decreased $136 million (30.3 percent) in the first quarter of 2025, compared with the first quarter of 2024, primarily due to the impacts of merger and integration charges and FDIC special assessment charges in the prior year, partially offset by higher marketing and business development expense, higher technology and communications expense and higher other noninterest expense. The provision for credit losses increased $149 million in the first quarter of 2025, compared with the first quarter of 2024, primarily due to the impact of deteriorating economic conditions and increased economic uncertainty.
Current report
•Return on tangible common equity.
Removed paragraphs (28)
Previous report
Net income attributable to U.S. Bancorp for the first nine months of 2024 was $4.6 billion, or $2.77 per diluted common share, compared with $4.6 billion, or $2.79 per diluted common share, for the first nine months of 2023. Return on average assets and return on average common equity were 0.94 percent and 11.6 percent, respectively, for the first nine months of 2024, compared with 0.92 percent and 12.3 percent, respectively, for the first nine months of 2023. The results for the first nine months of 2024 included the impact of $291 million ($218 million net-of-tax) of notable items, including $155 million of merger and integration charges and a $136 million charge for an increase in the FDIC special assessment to recover losses to the Deposit Insurance Fund related to certain 2023 bank failures. Combined, these items
Previous report
decreased diluted earnings per common share for the first nine months of 2024 by $0.14. The results for the first nine months of 2023 included the impact of $1.1 billion ($828 million net-of-tax) of notable items, including $838 million of merger and integration charges, and $243 million of provision for credit losses and an additional $22 million of losses related to balance sheet repositioning and capital management actions. Combined, these items decreased diluted earnings per common share for the first nine months of 2023 by $0.53.
Previous report
Total net revenue for the first nine months of 2024 was $936 million (4.4 percent) lower than the first nine months of 2023, reflecting an 8.6 percent decrease in net interest income, partially offset by a 2.7 percent increase in noninterest income. The decrease in net interest income from the first nine months of 2023 was primarily due to the impact of higher interest rates on deposit mix and pricing, partially offset by higher rates on earning assets and changes in balance sheet composition. The increase in noninterest income was driven by higher fee revenue across most categories, partially offset by higher net losses on the sales of investment securities, lower service charges and lower other noninterest income.
Previous report
Noninterest expense in the first nine months of 2024 was $777 million (5.7 percent) lower than the first nine months of 2023, primarily due to lower merger and integration charges, partially offset by higher compensation and employee benefits expense and the impact of the FDIC special assessment.
Previous report
The provision for credit losses for the first nine months of 2024 was $85 million (4.8 percent) lower than the first nine months of 2023, driven by the impacts of balance sheet repositioning and capital management actions taken in the second quarter of 2023, partially offset by higher net charge-offs in the current year. Net charge-offs in the first nine months of 2024 were $1.6 billion, compared with $1.4 billion in the first nine months of 2023. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.
Previous report
Provision for Credit Losses The provision for credit losses was $557 million in the third quarter of 2024, representing an
Previous report
increase of $42 million (8.2 percent) from the third quarter of 2023, driven by higher net charge-offs in the current year. Net charge-offs increased $144 million (34.3 percent) in the third quarter of 2024, compared with the third quarter of 2023, reflecting higher credit card, commercial and commercial real estate loan net charge-offs. The provision for credit losses was $1.7 billion in the first nine months of 2024, representing a decrease of $85 million (4.8 percent) from the first nine months of 2023. The decrease was primarily driven by the impacts of balance sheet repositioning and capital management actions in the second quarter of 2023, partially offset by higher net charge-offs in the current year. Net charge-offs increased $148 million (10.3 percent) in the first nine months of 2024, compared with the first nine months of 2023, reflecting higher credit card and commercial loan net charge-offs, partially offset by the impacts of charge-offs in the prior year related to acquired loans and balance sheet repositioning and capital management actions. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.
Previous report
first nine months of 2023, primarily due to synergies from the MUB acquisition.
Previous report
Credit card loans increased $477 million (1.7 percent) at September 30, 2024, compared with December 31, 2023, primarily driven by higher spend volume.
Previous report
credit card and commercial loan net charge-offs in the current year, partially offset by the impacts in the prior year of charge-offs on acquired loans and charge-offs related to balance sheet repositioning and capital management actions. The ratio of total loan net charge-offs to average loans outstanding on an annualized basis for the third quarter and first nine months of 2024 was 0.60 percent and 0.57 percent, respectively,
Previous report
compared with 0.44 percent and 0.50 percent, respectively, for the same periods of 2023.
Previous report
commercial and commercial real estate portfolios, partially offset by reduced portfolio exposures.
Previous report
The allowance for credit losses related to consumer lending segment loans increased $64 million during the first nine months of 2024, due to credit migration in credit card portfolios, partially offset by favorability in residential real estate secured portfolios related to strength in home values.
Previous report
(a)Effective January 1, 2023, the Company adopted accounting guidance which removed the separate recognition and measurement of troubled debt restructurings.
Previous report
(b)Allowance for purchased credit deteriorated and charged-off loans acquired from MUB.
Previous report
(c)Includes $91 million of charge-offs in the first quarter of 2023 related to uncollectible amounts on acquired loans. Includes $309 million of charge-offs in the second quarter of 2023 related to balance sheet repositioning and capital management actions.
Previous report
(d)Includes provision for credit losses of $243 million related to balance sheet repositioning and capital management actions in the second quarter of 2023.
Previous report
Borrowing capacity from the Federal Reserve Bank and FHLB declined from December 31, 2023 to September 30, 2024 primarily due to the expiration of the Federal Reserve Bank’s Bank Term Funding Program (“BTFP”). This decline was partially offset by an increase in available investment securities as a portion of the securities previously pledged through the BTFP were made available for sale or pledging.
Previous report
Line of Business Financial Review
Previous report
Net revenue decreased $12 million (0.4 percent) in the third quarter and increased $94 million (1.0 percent) in the first nine months of 2024, compared with the same periods of 2023. Net interest income, on a taxable-equivalent basis, decreased $127 million (6.3 percent) in the third quarter and $173 million (2.9 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to lower noninterest-bearing deposit balances, partially offset by the impact of higher interest rates. Noninterest income increased $115 million (11.2 percent) in the third quarter and $267 million (8.6 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to higher commercial products revenue and trust and investment management fees, both driven by business growth and favorable market conditions.
Previous report
Noninterest expense increased $24 million (1.8 percent) in the third quarter of 2024, compared with the third quarter of 2023, primarily due to higher net shared services expense. Noninterest expense increased $62 million (1.5 percent) in the first nine months of 2024, compared with the first nine months of 2023, primarily due to higher compensation and employee benefits expense. The provision for credit losses decreased $42 million (30.9 percent) in the third quarter of 2024, compared with the third quarter of 2023, primarily due to stable credit quality in the current quarter. The provision for credit losses increased $64 million (23.6 percent) in the first nine months of 2024, compared with the first nine months of 2023, primarily due to higher net charge-offs, partially offset by slower credit deterioration in the first nine months of 2024.
Previous report
Net revenue decreased $144 million (5.8 percent) in the third quarter and $1.0 billion (12.7 percent) in the first nine months of 2024, compared with the same periods of 2023. Net
Previous report
Noninterest expense decreased $36 million (2.1 percent) in the third quarter and $269 million (5.1 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to lower compensation and employee benefits expense and net shared services expense. The provision for credit losses increased $11 million in the third quarter and $72 million in the first nine months of 2024, compared with the same periods of 2023, primarily due to higher net charge-offs.
Previous report
Net revenue increased $98 million (5.8 percent) in the third quarter and $289 million (5.8 percent) in the first nine months of 2024, compared with the same periods of 2023. Net interest income, on a taxable-equivalent basis, increased $64 million (9.7 percent) in the third quarter and $169 million (8.7 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to higher loan yields driven by higher interest rates and customer revolve rates, along with higher loan balances, partially offset by higher funding costs. Noninterest income increased $34 million (3.3 percent) in the third quarter and $120 million (4.0 percent) in the first nine months of 2024, compared with the same periods of 2023, driven by higher card revenue due to favorable rates, and higher merchant processing services revenue due to business volume growth and favorable rates.
Previous report
Noninterest expense increased $20 million (2.0 percent) in the third quarter and $169 million (5.9 percent) in the first nine months of 2024, compared with the same periods of 2023, reflecting higher net shared services expense. The provision for credit losses increased $5 million (1.3 percent) in the third quarter and $218 million (23.4 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to higher net charge-offs.
Previous report
2024, compared with net losses of $448 million and $1.8 billion, respectively, in the same periods of 2023.
Previous report
Net revenue decreased $110 million (53.7 percent) in the third quarter and $300 million (52.1 percent) in the first nine months of 2024, compared with the same periods of 2023. Net interest income, on a taxable-equivalent basis, increased $72 million (15.5 percent) in the third quarter of 2024, compared with the third quarter of 2023, primarily due to higher yields on the investment securities portfolio, partially offset by higher funding costs. Net interest income, on a taxable-equivalent basis, decreased $155 million (13.3 percent) in the first nine months of 2024, compared with the first nine months of 2023, primarily due to higher funding costs, partially offset by higher yields on the investment securities portfolio and cash balances. Noninterest income decreased $182 million (69.7 percent) in the third quarter and $145 million (24.7 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to higher net losses on the sales of investment securities and a decrease in other revenue. The decrease in noninterest income in the first nine months of 2024, compared with the first nine months of 2023, was partially offset by a gain on the sale of mortgage servicing rights during the second quarter of 2024.
Previous report
Noninterest expense decreased $334 million (72.1 percent) in the third quarter and $739 million (50.5 percent) in the first nine months of 2024, compared with the same periods of 2023, primarily due to lower merger and integration charges and lower other noninterest expense, partially offset by higher higher compensation and employee benefits expense. The decrease in noninterest expense in the first nine months of 2024, compared with the first nine months of 2023, was further offset by the impact of the FDIC special assessment in the current year. The provision for credit losses increased $68 million in the third quarter of 2024, compared with the third quarter of 2023, primarily due to the impact of continued economic uncertainty not allocated to business line reserves. The provision for credit losses decreased $439 million (83.0 percent) in the first nine months of 2024, compared with the first nine months of 2023, primarily due to balance sheet repositioning and capital management actions in the prior year.
Reworded paragraphs (98)
Previous wording
Earnings Summary U.S. Bancorp and its subsidiaries (the “Company”) reported net income attributable to U.S. Bancorp of $1.7 billion for the third quarter of 2024, or $1.03 per diluted common share, compared with $1.5 billion, or $0.91 per diluted common share, for the third quarter of 2023. Return on average assets and return on average common equity were 1.03 percent and 12.4 percent, respectively, for the third quarter of 2024, compared with 0.91 percent and 11.9 percent, respectively, for the third quarter of 2023. The results for the third quarter of 2023 included the impact of $284 million ($213 million net-of-tax) of merger and integration charges associated with the acquisition of MUFG Union Bank, N.A. (“MUB”), which decreased diluted earnings per common share for the third quarter of 2023 by $0.14.
Current wording
Earnings Summary U.S. Bancorp and its subsidiaries (the “Company”) reported net income attributable to U.S. Bancorp of $1.7 billion for the first quarter of 2025, or $1.03 per diluted common share, compared with $1.3 billion, or $0.78 per diluted common share, for the first quarter of 2024. Return on average assets and return on average common equity were 1.04 percent and 12.3 percent, respectively, for the first quarter of 2025, compared with 0.81 percent and 10.0 percent, respectively, for the first quarter of 2024. The results for the first quarter of 2024 included the impact of $265 million ($199 million net-of-tax) of notable items, including $155 million of merger and integration charges associated with the acquisition of MUFG Union Bank, N.A. (“MUB”) and $110 million of incremental FDIC special assessment charges, which decreased diluted earnings per common share for the first quarter of 2024 by $0.12.
Previous wording
Total net revenue for the third quarter of 2024 was $168 million (2.4 percent) lower than the third quarter of 2023, reflecting a 2.4 percent decrease in net interest income and a 2.4 percent decrease in noninterest income. The decrease in net interest income from the third quarter of 2023 was primarily due to the impact of higher interest rates on deposit mix and pricing, partially offset by higher rates on earning assets and changes in balance sheet composition. The decrease in noninterest income was driven by net losses on the sales of investment securities, lower service charges and lower other noninterest income, partially offset by higher fee revenue across all other categories.
Current wording
Total net revenue for the first quarter of 2025 was $243 million (3.6 percent) higher than the first quarter of 2024, reflecting a 2.7 percent increase in net interest income and a 5.0 percent increase in noninterest income. The increase in net interest income from the first quarter of 2024 was primarily due to the mix of earning assets, fixed asset repricing and modest loan growth, partially offset by deposit mix. The increase in noninterest income was driven by higher trust and investment management fees, payment services revenue and other noninterest income.
Previous wording
Noninterest expense in the third quarter of 2024 was $326 million (7.2 percent) lower than the third quarter of 2023, primarily due to the impact of merger and integration charges in the prior year and lower other noninterest expense, partially offset by higher compensation and employee benefits expense.
Current wording
Noninterest expense in the first quarter of 2025 was $227 million (5.1 percent) lower than the first quarter of 2024, primarily due to the impact of merger and integration charges in the prior year and lower compensation and employee benefits expense, partially offset by higher marketing and business development expense and technology and communications expense.
Previous wording
Net Interest Income Net interest income, on a taxable-equivalent basis, was $4.2 billion in the third quarter and $12.2 billion in the first nine months of 2024, representing decreases of $102 million (2.4 percent) and $1.2 billion (8.6 percent), respectively, compared with the same periods of 2023. The decreases were primarily due to the impact of higher interest rates on deposit mix and pricing, partially offset by higher rates on earning assets and changes in balance sheet composition. Average earning assets for the third quarter of 2024 were $1.9 billion (0.3 percent) higher than the third quarter of 2023, reflecting increases in investment securities and other earning assets, partially offset by decreases in loans and interest-bearing deposits with banks. Average earning assets for the first nine months of 2024 were $4.8 billion (0.8 percent) lower than the first nine months of 2023, reflecting a
Current wording
Net Interest Income Net interest income, on a taxable-equivalent basis, was $4.1 billion in the first quarter of 2025, representing an increase of $107 million (2.7 percent) compared with the first quarter of 2024. The increase was primarily due to the mix of earning assets, fixed asset repricing and modest loan growth, partially offset by deposit mix. Average earning assets for the first quarter of 2025 were $14.1 billion (2.4 percent) higher than the first quarter of 2024, reflecting increases in investment securities, loans and other earning assets, partially offset by a decrease in interest-
Previous wording
decrease in loans, partially offset by increases in investment securities and interest-bearing deposits with banks. The net interest margin, on a taxable-equivalent basis, in the third quarter and first nine months of 2024 was 2.74 percent and 2.70 percent, respectively, compared with 2.81 percent and 2.94 percent in the third quarter and first nine months of 2023, respectively. The decreases in net interest margin from the same periods of the prior year were primarily due to the impact of higher interest rates on deposit mix and pricing, partially offset by higher rates on earning assets and changes in balance sheet composition. Refer to the “Consolidated Daily Average Balance Sheet and Related Yields and Rates” table for further information on net interest income.
Current wording
bearing deposits with banks. The net interest margin, on a taxable-equivalent basis, in the first quarter of 2025 was 2.72 percent, compared with 2.70 percent in the first quarter of 2024. The increase in net interest margin from the first quarter of 2024 was primarily due to improved balance sheet mix, fixed asset repricing and modest loan growth, partially offset by deposit mix and higher earning assets. Refer to the “Consolidated Daily Average Balance Sheet and Related Yields and Rates” table for further information on net interest income.
Previous wording
Average total loans in the third quarter and first nine months of 2024 were $2.8 billion (0.7 percent) and $10.8 billion (2.8 percent) lower, respectively, than the same periods of 2023. The decreases were primarily due to lower other retail loans, commercial loans and commercial real estate loans, partially offset by higher credit card loans and residential mortgages. The decreases in average other retail loans were driven by lower automobile loans. The decreases in average commercial loans were primarily due to decreased demand as corporate customers accessed the capital markets. The decreases in average commercial real estate loans were primarily due to payoffs exceeding a reduced level of new originations. The increases in average credit cards loans were primarily driven by higher spend volume. The increases in residential mortgages were primarily driven by originations.
Current wording
Average total loans in the first quarter of 2025 were $8.0 billion (2.1 percent) higher than the first quarter of 2024. The increase was primarily due to higher commercial loans, residential mortgages and credit card loans, partially offset by lower commercial real estate loans and other retail loans. The increase in average commercial loans was primarily due to growth in loans to financial institutions. The increase in residential mortgages was primarily driven by originations. The increase in average credit card loans was primarily driven by customer account growth and higher spend volume. The decrease in average commercial real estate loans was primarily due to loan workout activities and payoffs exceeding a reduced level of new originations. The decrease in average other retail loans was driven by lower automobile loans.
Previous wording
Average investment securities in the third quarter and first nine months of 2024 were $3.7 billion (2.2 percent) and $2.0 billion (1.2 percent) higher, respectively, than the same periods of 2023, primarily due to balance sheet positioning and liquidity management.
Current wording
Average investment securities in the first quarter of 2025 were $9.9 billion (6.2 percent) higher than the first quarter of 2024, primarily due to balance sheet positioning and liquidity management.
Previous wording
Average total deposits for the third quarter and first nine months of 2024 were $3.5 billion (0.7 percent) lower and $1.9 billion (0.4 percent) higher, respectively, than the same periods of 2023. Average noninterest-bearing deposits for the third quarter and first nine months of 2024 were $16.6 billion (17.0 percent) and $30.5 billion (26.9 percent) lower, respectively, than the same periods of 2023, driven by decreases in Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances. Average total savings deposits for the third quarter and first nine months of 2024 were $9.0 billion (2.5 percent) and $20.0 billion (5.7 percent) higher, respectively, than the same periods of 2023, driven by increases in Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances. Average time deposits for the third quarter and first nine months of 2024 were $4.1 billion (7.5 percent) and $12.5 billion (28.0 percent) higher, respectively, than the same periods of 2023, mainly due to increases in Consumer and Business Banking balances. Changes in time deposits are primarily related to those deposits managed as an alternative to other funding sources, based largely on relative pricing and liquidity characteristics.
Current wording
Average total deposits for the first quarter of 2025 were $3.5 billion (0.7 percent) higher than the first quarter of 2024. Average total savings deposits for the first quarter of 2025 were $8.2 billion (2.3 percent) higher than the first quarter of 2024, driven by increases in Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances. Average time deposits for the first quarter of 2025 were $358 million (0.6 percent) higher than the first quarter of 2024, mainly due to increases in Consumer and Business Banking balances, partially offset by decreases in Wealth, Corporate, Commercial and Institutional Banking balances. Changes in time deposits are primarily related to those deposits managed as an alternative to other funding sources, based largely on relative pricing and liquidity characteristics. Average noninterest-bearing deposits for the first quarter of 2025 were $5.1 billion (6.0 percent) lower than the first quarter of 2024, driven by decreases in Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances.
Previous wording
The provision for credit losses for the third quarter of 2024 was $42 million (8.2 percent) higher than the third quarter of 2023, driven by higher net charge-offs. Net charge-offs in the third quarter of 2024 were $564 million, compared with $420 million in the third quarter of 2023. Refer to “Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.
Current wording
“Corporate Risk Profile” for further information on the provision for credit losses, net charge-offs, nonperforming assets and other factors considered by the Company in assessing the credit quality of the loan portfolio and establishing the allowance for credit losses.
Previous wording
Noninterest Income Noninterest income was $2.7 billion in the third quarter and $8.2 billion in the first nine months of 2024, representing a decrease of $66 million (2.4 percent) and an increase of $216 million (2.7 percent), respectively, compared with the same periods of 2023. The decrease in noninterest income in the third quarter of 2024, compared with the third quarter of 2023, was driven by net losses on the sales of investment securities, lower service charges and lower other noninterest income, partially offset by higher commercial products revenue, trust and investment management fees and payment services revenue. The increase in noninterest income in the first nine months of 2024, compared with the first nine months of 2023, was driven by higher commercial products revenue, trust and investment management fees, payment services revenue and mortgage banking revenue, partially offset by higher net losses on the sales of investment securities, lower service charges and lower other noninterest income. Commercial products revenue increased in the current year primarily due to higher corporate bond fees and new product growth. Trust and investment management fees increased primarily due to business growth and favorable market conditions. Payment services revenue increased primarily due to higher merchant processing services revenue due to business volume growth and favorable rates, along with increased card revenue due to favorable rates. Mortgage banking revenue increased in the first nine months of 2024, compared with the first nine months of 2023, primarily driven by a gain on the sale of mortgage servicing rights in the second quarter of 2024, along with the impact of balance sheet repositioning and capital management actions taken in the second quarter of 2023.
Current wording
Noninterest Income Noninterest income was $2.8 billion in the first quarter of 2025, representing an increase of $136 million (5.0 percent) compared with the first quarter of 2024. The increase in noninterest income in the first quarter of 2025, compared with the first quarter of 2024, was primarily driven by higher trust and investment management fees, payment services revenue and other noninterest income. Trust and investment management fees increased primarily due to business growth and favorable market conditions. Payment services revenue increased primarily due to increases across all categories due to business volume growth. The increase in card revenue was partially offset by a reduction in prepaid card volumes from the prior year. Other noninterest income increased primarily due to higher tax credit investment activity and the impact of other favorable items.
Previous wording
Noninterest Expense Noninterest expense was $4.2 billion in the third quarter and $12.9 billion in the first nine months of 2024, representing decreases of $326 million (7.2 percent) and $777 million (5.7 percent), respectively, from the same periods of 2023. The decreases from the prior year reflected lower merger and integration charges and lower other noninterest expense, partially offset by higher compensation and employee benefits expense. The decrease in noninterest expense in the first nine months of 2024, compared with the first nine months of 2023, was further offset by the impact of the FDIC special assessment in the current year. Compensation and employee benefits expense increased in the current year primarily due to higher commissions and performance-based incentives. Marketing and business development expense increased in the first nine months of 2024, compared with the first nine months of 2023, primarily due to the timing of campaigns. Professional services expense decreased in the first nine months of 2024, compared with the
Current wording
Noninterest Expense Noninterest expense was $4.2 billion in the first quarter of 2025, representing a decrease of $227
Previous wording
Income Tax Expense The provision for income taxes was $350 million (an effective rate of 16.9 percent) for the third quarter and $1.1 billion (an effective rate of 19.7 percent) for the first nine months of 2024, compared with $431 million (an effective rate of 22.0 percent) and $1.3 billion (an effective rate of 21.6 percent) for the same periods of 2023, respectively. The tax rate in the third quarter and first nine months of 2024 reflected the impact of favorable settlements. For further information on income taxes, refer to Note 11 of the Notes to Consolidated Financial Statements.
Current wording
Income Tax Expense The provision for income taxes was $443 million (an effective rate of 20.5 percent) for the first quarter of 2025, compared with $347 million (an effective rate of 20.7 percent) for the first quarter of 2024. For further information on income taxes, refer to Note 11 of the Notes to Consolidated Financial Statements.
Previous wording
Loans The Company’s loan portfolio was $374.2 billion at September 30, 2024, compared with $373.8 billion at December 31, 2023, an increase of $329 million (0.1 percent). The increase was driven by higher residential mortgages and commercial loans, partially offset by lower commercial real estate loans and other retail loans.
Current wording
Loans The Company’s loan portfolio was $381.8 billion at March 31, 2025, compared with $379.8 billion at December 31, 2024, an increase of $2.0 billion (0.5 percent). The increase was driven by higher commercial loans, partially offset by lower credit card loans and other retail loans.
Previous wording
Commercial loans increased $1.8 billion (1.3 percent) at September 30, 2024, compared with December 31, 2023, primarily due to growth in corporate banking.
Current wording
Commercial loans increased $4.6 billion (3.3 percent) at March 31, 2025, compared with December 31, 2024, primarily due to growth in loans to financial institutions.
Previous wording
Residential mortgages held in the loan portfolio increased $2.5 billion (2.2 percent) at September 30, 2024, compared with December 31, 2023, driven by originations. Residential mortgages originated and placed in the Company’s loan portfolio include jumbo mortgages and branch-originated first lien home equity loans to borrowers with high credit quality.
Current wording
Residential mortgages held in the loan portfolio increased $94 million (0.1 percent) at March 31, 2025, compared with December 31, 2024, driven by originations. Residential mortgages originated and placed in the Company’s loan portfolio include jumbo mortgages and branch-originated first lien home equity loans to borrowers with high credit quality.
Previous wording
Other retail loans decreased $1.6 billion (3.5 percent) at September 30, 2024, compared with December 31, 2023, primarily due to a decrease in auto loans.
Current wording
Other retail loans decreased $1.1 billion (2.5 percent) at March 31, 2025, compared with December 31, 2024, primarily due to a decrease in automobile loans.
Previous wording
Commercial real estate loans decreased $2.8 billion (5.3 percent) at September 30, 2024, compared with December 31, 2023, primarily due to payoffs exceeding a reduced level of new originations.
Current wording
Commercial real estate loans decreased $525 million (1.1 percent) at March 31, 2025, compared with December 31, 2024, primarily due to loan workout activities and payoffs exceeding a reduced level of new originations.
Previous wording
Loans Held for Sale Loans held for sale, consisting primarily of residential mortgages to be sold in the secondary market, were $3.2 billion at September 30, 2024, compared with $2.2 billion at December 31, 2023. The increase in loans held for sale was principally due to a higher level of mortgage loan closings in the third quarter of 2024, compared with the fourth
Current wording
Loans Held for Sale Loans held for sale, consisting primarily of residential mortgages to be sold in the secondary market, were $1.7 billion at March 31, 2025, compared with $2.6 billion at December 31, 2024. The decrease in loans held for sale was principally due to a lower level of mortgage loan closings
Previous wording
quarter of 2023. Almost all of the residential mortgage loans the Company originates or purchases for sale follow guidelines that allow the loans to be sold into existing, highly liquid secondary markets, in particular in government agency transactions and to government-sponsored enterprises (“GSEs”).
Current wording
in the first quarter of 2025, compared with the fourth quarter of 2024. Almost all of the residential mortgage loans the Company originates or purchases for sale follow guidelines that allow the loans to be sold into existing, highly liquid secondary markets, in particular in government agency transactions and to government sponsored enterprises (“GSEs”).
Previous wording
Investment Securities Investment securities totaled $161.7 billion at September 30, 2024, compared with $153.8 billion at December 31, 2023. The $8.0 billion (5.2 percent) increase was primarily due to net investment purchases driven by balance sheet positioning and liquidity management, along with a $1.2 billion favorable change in net unrealized gains (losses) on available-for-sale investment securities.
Current wording
Investment Securities Investment securities totaled $164.8 billion at March 31, 2025, compared with $164.6 billion at December 31, 2024. The $156 million (0.1 percent) increase was primarily due to a $508 million favorable change in net unrealized gains (losses) on available-for-sale investment securities, partially offset by net investment securities sales driven by balance sheet positioning and liquidity management.
Previous wording
The Company’s available-for-sale investment securities are carried at fair value with changes in fair value reflected in other comprehensive income (loss) unless a portion of a security’s unrealized loss is related to credit and an allowance for credit losses is necessary. At September 30, 2024, the Company’s net unrealized losses on available-for-sale investment securities were $5.7 billion ($4.3 billion net-of-tax), compared with $6.9 billion ($5.2 billion net-of-tax) at December 31, 2023. The favorable change in net unrealized gains (losses) was primarily due to increases in the fair value of mortgage-backed securities as a result of changes in interest rates. Gross unrealized losses on available-for-sale investment securities totaled $5.9 billion at September 30, 2024, compared with $7.1 billion at December 31, 2023. When evaluating credit losses, the Company considers various factors such as the nature of the investment security, the credit ratings or financial condition of the issuer, the extent of the unrealized loss, expected cash flows of the underlying collateral, the existence of any government or agency guarantees, and market conditions. At September 30, 2024, the Company had no plans to sell securities with unrealized losses, and believed it was more likely than not that it would not be required to sell such securities before recovery of their amortized cost.
Current wording
The Company’s available-for-sale investment securities are carried at fair value with changes in fair value reflected in other comprehensive income (loss) unless a portion of a security’s unrealized loss is related to credit and an allowance for credit losses is necessary. At March 31, 2025, the Company’s net unrealized losses on available-for-sale investment securities were $6.3 billion ($4.7 billion net-of-tax), compared with net unrealized losses of $6.8 billion ($5.1 billion net-of-tax) at December 31, 2024. The favorable change in net unrealized gains (losses) was primarily due to increases in the fair value of U.S. treasury and mortgage-backed securities as a result of changes in interest rates. Gross unrealized losses on available-for-sale investment securities totaled $6.4 billion at March 31, 2025, compared with $6.9 billion at December 31, 2024. When evaluating credit losses, the Company considers various factors such as the nature of the investment security, the credit ratings or financial condition of the issuer, the extent of the unrealized loss, expected cash flows of the underlying collateral, the existence of any government or agency guarantees, and market conditions. At March 31, 2025, the Company had no plans to sell securities with unrealized losses, and believed it was more likely than not that it would not be required to sell such securities before recovery of their amortized cost.
Previous wording
Deposits Total deposits were $521.1 billion at September 30, 2024, compared with $512.3 billion at December 31, 2023. The $8.8 billion (1.7 percent) increase in total deposits reflected increases in time deposits and total savings deposits, partially offset by a decrease in noninterest-bearing deposits. Time deposits increased $7.1 billion (13.5 percent) at September 30, 2024, compared with December 31, 2023, driven by higher Consumer and Business Banking balances. Changes in time deposits are primarily related to those deposits managed as an alternative to other funding sources, based largely on relative pricing and liquidity characteristics. Money market deposit balances increased $11.6 billion (5.8 percent), primarily due to higher Consumer and Business Banking, and Wealth, Corporate, Commercial and Institutional Banking balances. Savings account balances decreased $6.2 billion (14.3 percent), driven by lower Consumer and Business Banking balances. Interest checking balances decreased $485 million (0.4 percent), primarily due to lower Consumer and Business Banking balances, partially offset by higher Wealth, Corporate, Commercial and Institutional Banking balances. Noninterest-bearing deposits decreased $3.2 billion (3.5 percent) at September 30, 2024, compared with December 31, 2023, primarily driven by a decrease in Wealth, Corporate, Commercial and Institutional Banking balances due to the impact of higher interest rates.
Current wording
Deposits Total deposits were $512.5 billion at March 31, 2025, compared with $518.3 billion at December 31, 2024. The $5.8 billion (1.1 percent) decrease in total deposits reflected decreases in total savings deposits and noninterest-bearing deposits, partially offset by an increase in time deposits. Money market deposit balances decreased $21.1 billion (10.2 percent), primarily due to lower Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances. Savings account balances increased $10.0 billion (22.0 percent), driven by higher Consumer and Business Banking balances. Interest checking balances increased $4.9 billion (3.8 percent), primarily due to higher Wealth, Corporate, Commercial and Institutional Banking, and Consumer and Business Banking balances. Noninterest-bearing deposits decreased $72 million (0.1 percent) at March 31, 2025, compared with December 31, 2024, primarily driven by a decrease in Wealth, Corporate, Commercial and Institutional Banking balances, partially offset by an increase in Consumer and Business Banking balances. Time deposits increased $476 million (0.9 percent) at
Previous wording
September 30, 2024, compared with $15.3 billion at December 31, 2023. The $8.4 billion (55.2 percent) increase in short-term borrowings was primarily due to increases in short-term Federal Home Loan Bank (“FHLB”) advances and repurchase agreement balances, partially offset by lower commercial paper balances. Long-term debt was $54.8 billion at September 30, 2024, compared with $51.5 billion at December 31, 2023. The $3.4 billion (6.5 percent) increase was primarily due to $6.1 billion of medium-term note issuances and a $2.5 billion increase in FHLB advances, partially offset by $4.6 billion of medium-term note and $1.0 billion of subordinated note repayments. Refer to the “Liquidity Risk Management” section for discussion of liquidity management of the Company.
Current wording
Borrowings The Company utilizes both short-term and long-term borrowings as part of its asset/liability management and funding strategies. Short-term borrowings, which include federal funds purchased, commercial paper, repurchase agreements, borrowings secured by high-grade assets and other short-term borrowings, were $17.2 billion at March 31, 2025, compared with $15.5 billion at December 31, 2024. The $1.6 billion (10.6 percent) increase in short-term borrowings was primarily due to increases in repurchase agreement balances, partially offset by a decrease in short-term Federal Home Loan Bank (“FHLB”) advances. Long-term debt was $59.9 billion at March 31, 2025, compared with $58.0 billion at December 31, 2024. The $1.9 billion (3.2 percent) increase was primarily due to $3.0 billion of medium-term note and $625 million of credit-linked bank note issuances, partially offset by $2.0 billion of bank note repayments. Refer to the “Liquidity Risk Management” section for discussion of liquidity management of the Company.
Previous wording
(d)Amortized cost excludes portfolio level basis adjustments of $525 million at September 30, 2024 and $335 million at December 31, 2023.
Current wording
(d)Amortized cost excludes portfolio level basis adjustments of $204 million at March 31, 2025 and $13 million at December 31, 2024.
Previous wording
team, oversees execution against the risk management framework and risk appetite statements. The ERC focuses on current and emerging risks, including strategic and reputation risks, by directing timely and comprehensive actions. Senior operating committees have also been established, each responsible for overseeing a specified category of risk.
Current wording
The Executive Risk Committee (“ERC”), which is chaired by the Chief Risk Officer and includes the Chief Executive Officer and other members of the executive management team, oversees execution against the risk management framework and risk appetite statements. The ERC focuses on current and emerging risks, including strategic and reputation risks, by directing timely and comprehensive actions. Senior operating committees have also been established, each responsible for overseeing a specified category of risk.
Previous wording
The Company’s most prominent risk exposures are credit, interest rate, market, liquidity, operational, compliance, strategic, and reputation. Credit risk is the risk of loss associated with a change in the credit profile or the failure of a borrower or counterparty to meet its contractual obligations. Interest rate risk is the current or prospective risk to earnings and capital, or market valuations, arising from the impact of changes in interest rates. Market risk arises from fluctuations in interest rates, foreign exchange rates, and security prices that may result in changes in the values of financial instruments, such as trading and available-for-sale investment securities, mortgage loans held for sale (“MLHFS”), mortgage servicing rights (“MSRs”) and derivatives that are accounted for on a fair value basis. Liquidity risk is the risk that financial condition or overall safety and soundness is adversely affected by the Company’s inability, or perceived inability, to meet its cash flow obligations in a timely and complete manner in either normal or stressed conditions. Operational risk is the risk to current or projected financial condition and resilience arising from inadequate or failed internal processes or systems, people (including human errors or misconduct), or adverse external events, including the risk of loss resulting from breaches in data security. Operational risk can also include the risk of loss due to failures by third parties with which the Company does business. Compliance risk is the risk that the Company may suffer legal or regulatory sanctions, financial losses, and reputational damage if it fails to adhere to compliance requirements and the Company’s compliance policies. Strategic risk is the risk to current or projected financial condition and resilience arising from adverse business decisions, poor implementation of business decisions, or lack of responsiveness to changes in the banking industry and operating environment. Reputation risk is the risk to current or anticipated earnings, capital, or franchise or enterprise value arising from negative public opinion. This risk may impair the Company’s competitiveness by affecting its ability to establish new relationships or services, or continue serving existing relationships. In addition to the risks identified above, other risk factors exist that may impact the Company. Refer to “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, for a detailed discussion of these factors.
Current wording
The Company’s most prominent risk exposures are credit, interest rate, market, liquidity, operational, compliance, strategic, and reputation. Credit risk is the risk of loss associated with a change in the credit profile or the failure of a borrower or counterparty to meet its contractual obligations. Interest rate risk is the current or prospective risk to earnings and capital, or market valuations, arising from the impact of changes in interest rates. Market risk is the risk associated with fluctuations in interest rates, foreign exchange rates, commodities and credit spreads that may result in changes in the values of financial instruments, such as trading and available-for-sale investment securities, mortgage loans held for sale (“MLHFS”), mortgage servicing rights (“MSRs”) and derivatives that are accounted for on a fair value basis. Liquidity risk is the risk that financial condition or overall safety and soundness is adversely affected by the Company’s inability, or perceived inability, to meet its cash flow obligations in a timely and complete manner in either normal or stressed conditions. Operational risk is the risk to current or projected financial condition and resilience arising from inadequate or failed internal processes or systems, people (including human errors or misconduct), or adverse external events, including the risk of loss resulting from breaches in data security. Operational risk can also include the risk of loss due to failures by third parties with which the Company does business. Compliance risk is the risk that the Company may suffer legal or regulatory sanctions, financial losses, and reputational damage if it fails to adhere to compliance requirements and the Company’s compliance policies. Strategic risk is the risk to current or projected financial condition and resilience arising from adverse business decisions, poor implementation of business decisions, or lack of responsiveness to changes in the banking industry and operating environment. Reputation risk is the risk to current or projected financial condition and resilience arising from negative public opinion. This risk may impair the Company’s competitiveness by affecting its ability to establish new relationships or services, or continue servicing existing
Previous wording
The Company’s Board and management-level governance committees are supported by a “three lines of defense” model for establishing effective checks and balances. The first line of defense, the business lines, manages risks in conformity with established limits and policy requirements. In turn, business line leaders and their risk officers establish programs to ensure conformity with these limits and policy requirements. The second line of defense, which includes the Chief Risk Officer’s organization as well as policy and oversight activities of corporate support functions, translates risk appetite and strategy into actionable risk limits and policies. The second line of defense monitors first line of defense conformity with limits and policies and provides reporting and escalation of
Current wording
The Company’s Board and management-level governance committees are supported by a “three lines of defense” model for establishing effective checks and balances. The first line of defense, the business lines, manages risks in conformity with established limits and policy requirements. In turn, business line leaders and their risk officers establish programs to ensure conformity with these limits and policy requirements. The second line of defense, which includes the Chief Risk Officer’s organization as well as policy and oversight activities of corporate support functions, translates risk appetite and strategy into actionable risk limits and policies. The second line of defense monitors first line of defense conformity with limits and policies and provides reporting and escalation of emerging risks and other concerns to senior management and the Risk Management Committee of the Board of Directors. The third line of defense, internal audit, is responsible for providing the Audit Committee of the Board of Directors and senior management with independent assessment and assurance regarding the effectiveness of the Company’s governance, risk management and control processes.
Previous wording
credit risk management and evaluation of its allowance for credit losses. Loans with a pass rating represent those loans not classified on the Company’s rating scale for problem credits, as minimal credit risk has been identified. Loans with a special mention or classified rating (defined by internally assessed rating or exception based monitoring credits in consumer lending and small business loans that are 90 days or more past due and still accruing, nonaccrual loans and loans in a junior lien position that are current but are behind a first lien position on nonaccrual), encompass all loans held by the Company that it considers to have a potential or well-defined weakness that may put full collection of contractual cash flows at risk. The Company’s internal credit quality ratings for consumer loans are primarily based on delinquency and nonperforming status. Refer to Note 4 in the Notes to Consolidated Financial Statements for further discussion of the Company’s loan portfolios including internal credit quality ratings. In addition, refer to “Management’s Discussion and Analysis — Credit Risk Management” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, for a more detailed discussion on credit risk management processes.
Current wording
In addition, credit quality ratings, as defined by the Company, are an important part of the Company’s overall credit risk management and evaluation of its allowance for credit losses. Loans with a pass rating represent those loans not classified on the Company’s rating scale for problem credits, as minimal credit risk has been identified. Loans with a special mention or classified rating (defined by internally assessed rating or exception based monitoring credits in consumer lending and small business loans that are 90 days or more past due and still accruing, nonaccrual loans and loans in a junior lien position that are current but are behind a first lien position on nonaccrual) encompass all loans held by the Company that it considers to have a potential or well-defined weakness that may put full collection of contractual cash flows at risk. The Company’s internal credit quality ratings for consumer loans are primarily based on delinquency and nonperforming status. Refer to Note 4 in the Notes to Consolidated Financial Statements for further discussion of the Company’s loan portfolios including internal credit quality ratings. In addition, refer to “Management’s Discussion and Analysis — Credit Risk Management” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, for a more detailed discussion on credit risk management processes.
Previous wording
The commercial lending segment includes loans and leases made to small business, middle market, large corporate, commercial real estate, financial institution, non-profit and public sector customers. Key risk characteristics relevant to commercial lending segment loans include the industry and geography of the borrower’s business, purpose of the loan, repayment source, borrower’s debt capacity and financial flexibility, loan covenants, and nature of pledged collateral, if any, as well as macroeconomic factors such as unemployment rates, gross domestic product levels, corporate bond spreads and long-term interest rates. These risk characteristics, among others, are considered in determining estimates about the likelihood of default by the borrowers and the severity of loss in the event of default. The Company considers these risk characteristics in assigning internal risk ratings to, or forecasting losses on, these loans, which are the significant factors in determining the allowance for credit losses for loans in the commercial lending segment.
Current wording
The commercial lending segment includes loans and leases made to small business, middle market, large corporate, commercial real estate, financial institution, non-profit and public sector customers. Key risk characteristics relevant to commercial lending segment loans include the industry and geography of the borrower’s business, purpose of the loan, repayment source, borrower’s debt capacity and financial flexibility, loan covenants, and nature of pledged collateral, if any, as well as macroeconomic factors such as unemployment rates, gross domestic product levels, corporate bond spreads and long-term interest rates. These risk
Previous wording
The consumer lending segment represents loans and leases made to consumer customers, including residential mortgages, credit card loans, and other retail loans such as revolving consumer lines, auto loans and leases and home equity loans and lines. Key risk characteristics relevant to consumer lending segment loans primarily relate to the borrowers’ capacity and willingness to repay and include unemployment rates, consumer bankruptcy filings, household debt levels, real disposable income and other macroeconomic factors, customer payment history and credit scores, effect of higher interest rates on variable rate or adjustable rate loans, and in some cases, updated loan-to-value (“LTV”) information
Current wording
The consumer lending segment represents loans and leases made to consumer customers, including residential mortgages, credit card loans, and other retail loans such as revolving consumer lines, auto loans and leases and home equity loans and lines. Key risk characteristics relevant to consumer lending segment loans primarily relate to the borrowers’ capacity and willingness to repay, customer payment history and credit scores and consider macroeconomic factors such as unemployment rates, consumer bankruptcy filings, household debt levels, real disposable income, effect of higher interest rates on variable rate or adjustable rate loans, and in some cases, updated loan-to-value (“LTV”) information reflecting current market conditions on secured loans. These and other risk characteristics are reflected in forecasts of delinquency levels, bankruptcies and losses which are the primary factors in determining the allowance for credit losses for the consumer lending segment.
Previous wording
The Company’s consumer lending segment utilizes several distinct business processes and channels to originate consumer credit, including traditional branch lending, mobile and online banking, indirect lending, alliance partnerships and correspondent banks. Each distinct underwriting and origination activity manages unique credit risk characteristics and prices its loan production commensurate with the differing risk profiles.
Current wording
The Company’s consumer lending segment originates consumer credit through several channels, including traditional branch lending, mobile and online banking, indirect lending, alliance partnerships and correspondent banks. Each distinct underwriting and origination process within consumer lending manages unique credit risk characteristics and prices its loan production commensurate with the differing risk profiles.
Previous wording
The Company estimates updated LTV information on its outstanding residential mortgages quarterly, based on a method that combines automated valuation model updates and relevant home price indices. LTV is the ratio of the loan’s outstanding principal balance to the current estimate of property value. For home equity and second mortgages, combined loan-to-value (“CLTV”) is the combination of the first mortgage original principal balance and the second lien outstanding principal balance, relative to the current estimate of property value. Certain loans do not have an LTV or CLTV, primarily due to lack of availability of relevant automated valuation model and/or home price indices values, or lack of necessary valuation data on acquired loans.
Current wording
The Company estimates updated LTV information on its outstanding residential mortgages quarterly, based on a method that combines automated valuation model updates and relevant home price indices. LTV is the ratio of the loan’s outstanding principal balance to the current estimate of property value. For home equity and second mortgages, combined loan-to-value (“CLTV”) is the combination of the first mortgage original principal balance and the second lien
Previous wording
Accruing loans 90 days or more past due totaled $738 million at September 30, 2024, compared with $698 million at December 31, 2023. Accruing loans 90 days or more past due are not included in nonperforming assets and continue to accrue interest because they are adequately secured by collateral, are in the process of collection and are reasonably expected to result in repayment or restoration to current status, or are managed in homogeneous portfolios with specified charge-off timeframes adhering to regulatory guidelines. The ratio of accruing loans 90 days or more past due to total loans was 0.20 percent at September 30, 2024 and 0.19 percent at December 31, 2023.
Current wording
Accruing loans 90 days or more past due totaled $796 million at March 31, 2025, compared with $810 million at December 31, 2024. Accruing loans 90 days or more past due are not included in nonperforming assets and continue to accrue interest because they are adequately secured by collateral, are in the process of collection and are reasonably expected to result in repayment or restoration to current status, or are managed in homogeneous portfolios with specified charge-off timeframes adhering to regulatory guidelines. The ratio of accruing loans 90 days or more past due to total loans was 0.21 percent at March 31, 2025 and December 31, 2024.
Previous wording
(a)Delinquent loan ratios exclude $2.0 billion at September 30, 2024 and December 31, 2023, of loans purchased and loans that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose repayments are primarily insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs. Including these loans, the ratio of residential mortgages 90 days or more past due and nonperforming to total residential mortgages was 1.97 percent at September 30, 2024, and 2.00 percent at December 31, 2023.
Current wording
(a)Delinquent loan ratios exclude $2.5 billion at March 31, 2025, and $2.3 billion at December 31, 2024, of loans purchased and loans that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose repayments are primarily insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs. Including these loans, the ratio of residential mortgages 90 days or more past due and nonperforming to total residential mortgages was 2.40 percent at March 31, 2025, and 2.28 percent at December 31, 2024.
Previous wording
(a)Excludes $607 million of loans 30-89 days past due and $2.0 billion of loans 90 days or more past due at September 30, 2024, purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options that continue to accrue interest, compared with $595 million and $2.0 billion at December 31, 2023, respectively.
Current wording
(a)Excludes $512 million of loans 30-89 days past due and $2.5 billion of loans 90 days or more past due at March 31, 2025, purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options that continue to accrue interest, compared with $660 million and $2.3 billion at December 31, 2024, respectively.
Previous wording
(b)Includes revolving credit, installment and automobile loans.
Current wording
(c)Includes revolving credit, installment and automobile loans.
Previous wording
The Company continues to work with borrowers who are experiencing financial difficulties to modify their loans. Many of the Company’s loan modifications are determined on a case-by-case basis in connection with ongoing loan collection processes. The modifications vary within each of the Company’s loan classes. Commercial lending segment modifications generally include extensions of the maturity date and may be accompanied by an increase or decrease to the interest rate. The Company may also work with the borrower to make other changes to the loan to mitigate losses, such as
Current wording
The Company continues to work with borrowers who are experiencing financial difficulties to modify their loans. Many of the Company’s loan modifications are determined on a case-by-case basis in connection with ongoing loan collection processes. The modifications vary within each of the Company’s loan classes. Commercial lending segment modifications generally include extensions of the maturity date and may be accompanied by an increase or decrease to the interest rate. The Company may also work with the borrower to
Previous wording
obtaining additional collateral and/or guarantees to support the loan.
Current wording
make other changes to the loan to mitigate losses, such as obtaining additional collateral and/or guarantees to support the loan.
Previous wording
Credit card and other retail loan modifications are generally part of distinct modification programs providing
Current wording
Credit card and other retail loan modifications are generally part of distinct modification programs providing customers modification solutions over a specified time period, generally up to 60 months.
Previous wording
The Company also makes short-term modifications, in limited circumstances, to assist borrowers experiencing temporary hardships. Short-term consumer lending modification programs include payment reductions, deferrals of up to three past due payments, and the ability to return to current status if the borrower makes required payments. The Company may also make short-term modifications to commercial lending loans, with the most common modification being an extension of the maturity date of three months or less. Such extensions generally are used when the maturity date is imminent and the borrower is experiencing some level of financial stress, but the Company believes the borrower will pay all contractual amounts owed.
Current wording
The Company also makes short-term modifications, in limited circumstances, to assist borrowers experiencing temporary hardships. Short-term consumer lending modification programs include payment reductions, deferrals of up to three past due payments, and the ability to return to current status if the borrower makes required payments. The Company may also make short-term modifications to commercial lending loans, with the most common modification being an extension of the maturity date of three months or less. Such extensions generally are used when the maturity date is imminent and the borrower is experiencing some level of financial stress, but the Company believes the borrower will pay all contractual amounts owed. During January 2025, wildfires caused substantial damage and disruption to the Los Angeles area. The Company has programs available to work with impacted customers and support the community. The Company continues to monitor the potential impacts on its customers and financial statements as the situation evolves. The Company does not anticipate this impact to be material to its financial results and expects only transitory impacts to delinquency levels as impacted borrowers enter forbearance programs.
Showing the first 40 of 98 pairs. Open the source sections for the rest.
Rearranged current paragraphs (13)
Current report — wording carried from elsewhere
March 31, 2025, compared with December 31, 2024, driven by higher Consumer and Business Banking balances. Changes in time deposits are primarily related to those deposits managed as an alternative to other funding sources, based largely on relative pricing and liquidity characteristics.
Current report — wording carried from elsewhere
relationships. In addition to the risks identified above, other risk factors exist that may impact the Company. Refer to “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, for a detailed discussion of these factors.
Current report — wording carried from elsewhere
characteristics, among others, are considered in determining estimates about the likelihood of default by the borrowers and the severity of loss in the event of default. The Company considers these risk characteristics in assigning internal risk ratings to, or forecasting losses on, these loans, which are the significant factors in determining the allowance for credit losses for loans in the commercial lending segment.
Current report — wording carried from elsewhere
outstanding principal balance, relative to the current estimate of property value. Certain loans do not have an LTV or CLTV, primarily due to lack of availability of relevant automated valuation model and/or home price indices values, or lack of necessary valuation data on acquired loans.
Current report — wording carried from elsewhere
Nonperforming Assets The level of nonperforming assets represents another indicator of the Company’s risk within the
Current report — wording carried from elsewhere
conditions for the foreseeable future and reflect significant judgment and consideration of economic forecast uncertainty. Final loss estimates also consider factors affecting credit losses not reflected in the scenarios, due to the unique aspects of current conditions and expectations. These factors may include, but are not limited to, changes in borrower behavior or conditions in specific lending segments, loan servicing practices, regulatory guidance, and/or fiscal and monetary policy actions.
Current report — wording carried from elsewhere
place for the assessment, identification, monitoring, management and reporting of compliance risks and issues, including those created or increased by economic and financial disruptions. Refer to “Management’s Discussion and Analysis — Compliance Risk Management” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, for further discussion on compliance risk management.
Current report — wording carried from elsewhere
The Company does not designate all of the derivatives that it enters into for risk management purposes as accounting hedges because of the inefficiency of applying the associated accounting requirements and may instead elect fair value
Current report — wording carried from elsewhere
the Company’s corporate functions. Valuation of positions in the corporate bond trading, loan trading, asset-backed securities and municipal securities businesses are based on trader marks. These trader marks are evaluated against third-party prices, with significant variances approved by senior management in the Company’s corporate functions.
Current report — wording carried from elsewhere
Federal Reserve Bank’s Discount Window. Unencumbered liquid assets in the Company’s investment securities portfolio provide asset liquidity through the Company’s ability to sell the securities or pledge and borrow against them. Refer to Note 3 of the Notes to Consolidated Financial Statements and “Balance Sheet Analysis” for further information on investment securities maturities and trends. Asset liquidity is further enhanced by the Company’s practice of pledging loans to access secured borrowing facilities through the FHLB and Federal Reserve Bank.
Current report — wording carried from elsewhere
market, large corporate, commercial real estate, government and institutional clients. Wealth, Corporate, Commercial and Institutional Banking contributed $1.2 billion of the Company’s net income in the first quarter of 2025, or an increase of $45 million (4.0 percent) compared with the first quarter of 2024.
Current report — wording carried from elsewhere
(a)Includes goodwill related to certain investments in unconsolidated financial institutions per prescribed regulatory requirements.
Current report — wording carried from elsewhere
Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
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Borrowings The Company utilizes both short-term and long-term borrowings as part of its asset/liability management and funding strategies. Short-term borrowings, which include federal funds purchased, commercial paper, repurchase agreements, borrowings secured by high-grade assets and other short-term borrowings, were $23.7 billion at
Previous report — wording carried elsewhere
The Executive Risk Committee (“ERC”), which is chaired by the Chief Risk Officer and includes the Chief Executive Officer and other members of the executive management
Previous report — wording carried elsewhere
emerging risks and other concerns to senior management and the Risk Management Committee of the Board of Directors. The third line of defense, internal audit, is responsible for providing the Audit Committee of the Board of Directors and senior management with independent assessment and assurance regarding the effectiveness of the Company’s governance, risk management and control processes.
Previous report — wording carried elsewhere
In addition, credit quality ratings, as defined by the Company, are an important part of the Company’s overall
Previous report — wording carried elsewhere
reflecting current market conditions on secured loans. These and other risk characteristics are reflected in forecasts of delinquency levels, bankruptcies and losses which are the primary factors in determining the allowance for credit losses for the consumer lending segment.
Previous report — wording carried elsewhere
customers modification solutions over a specified time period, generally up to 60 months.
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payments collected from assets on nonaccrual status are generally applied against the principal balance and not recorded as income. However, interest income may be recognized for interest payments received if the remaining carrying amount of the loan is believed to be collectible.
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Interest Rate Risk Management In the banking industry, changes in interest rates are a significant risk that can impact
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to accounting for derivative instruments and hedging activities. The Company has elected the fair value option for the MLHFS.
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The Company also measures the market risk of its hedging activities related to residential MLHFS and MSRs using the Historical Simulation method. The VaRs are measured at the
Previous report — wording carried elsewhere
access secured borrowing facilities through the FHLB and Federal Reserve Bank.
Previous report — wording carried elsewhere
In addition, the Company provides financing to domestic multinational corporations that generate revenue from customers in European countries, transacts with various European banks as counterparties to certain derivative-related activities, and through a subsidiary, manages money market
Previous report — wording carried elsewhere
Corporate, Commercial and Institutional Banking line of business during the third quarter of 2023. Prior period results were restated and presented on a comparable basis.