Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Schedule of effective tax rate

The following table is an analysis of the effective tax rate:

	Years Ended December 31,
(Dollars in millions)	2019		2018		2017
Federal income tax rate	21	%	21	%	35	%
Net tax effects of:
State income taxes, net of federal income tax benefit	(13	)	7		5
Goodwill impairment	(45	)	—		—
Tax-exempt interest income	2		(1	)	(1	)
Losses from LIHC investments	4		(2	)	(3	)
Amortization of LIHC investments	(20	)	12		14
Tax credits	40		(25	)	(21	)
FDIC insurance premiums	(2	)	1		—
Valuation allowance release	1		—		—
Effects of US tax law change	—		(2	)	(8	)
State tax refunds	—		(5	)	—
Other	—		(1	)	1
Effective tax rate	(12	)%	5	%	22	%

Components of Income Tax Expense

The components of income tax expense were as follows:

	Years Ended December 31,
(Dollars in millions)	2019			2018			2017
Current income tax expense:
Federal	$	191		$	195		$	257
State	154			89			21
Foreign	1			10			(4		)
Total current expense	346			294			274
Deferred income tax expense (benefit):
Federal	(202		)	(173		)	(49		)
State	(61		)	(64		)	52
Foreign	(1		)	(5		)	22
Total deferred expense	(264		)	(242		)	25
Total income tax expense	$	82		$	52		$	299

Schedule of components of the Company's net deferred tax balances

The components of the Company's net deferred tax balances as of December 31, 2019 and 2018 were as follows:

	December 31,
(Dollars in millions)	2019		2018
Deferred tax assets:
Tax credits and net operating loss carryforwards	$	499	$	448
Allowance for credit losses	312		251
Accrued expense, net	143		159
Unrealized losses on pension and postretirement benefits	233		260
Unrealized net losses on securities available for sale	32		132
Fair value adjustments for valuation of FDIC covered assets	40		53
Unrealized gains/losses on cash flow hedges	41		78
Other	30		—
Total deferred tax assets	1,330		1,381
Deferred tax liabilities:
Leasing and renewable energy	515		619
Intangible assets	17		59
Pension liabilities	373		365
Other	—		10
Total deferred tax liabilities	905		1,053
Net deferred tax asset (liability)	$	425	$	328

Schedule of changes in unrecognized tax positions

The following table reflects the changes in gross unrecognized tax benefits:

	Years Ended December 31,
(Dollars in millions)	2019			2018			2017
Balance, beginning of year	$	127		$	56		$	11
Gross increases as a result of tax positions taken during prior periods	1			72			45
Gross decreases as a result of tax positions taken during prior periods	—			—			—
Gross increases as a result of tax positions taken during current period	—			—			2
Gross decrease as a result of closed audit years or settlements	(2		)	(1		)	(2		)
Balance, end of year	$	126		$	127		$	56