Interest Income and Interest Expense

12 Months Ended

Dec. 31, 2023

Interest Income (Expense), Net [Abstract]

Interest Income and Interest Expense

Interest income and Interest expense

Interest income and interest expense are recorded in the Consolidated statements of income and classified based on the nature of the underlying asset or liability.

Interest income and interest expense includes the current-period interest accruals for financial instruments measured at fair value, except for derivatives and financial instruments containing embedded derivatives that would be separately accounted for in accordance with U.S. GAAP, absent the fair value option election; for those instruments, all changes in fair value including any interest elements, are primarily reported in principal transactions revenue. For financial instruments that are not measured at fair value, the related interest is included within interest income or interest expense, as applicable.

Interest income on loans and securities include the amortization and accretion of purchase premiums and discounts, as well as net deferred fees and costs on loans. These amounts are deferred in loans and investment securities, respectively, and recognized on a level-yield basis.

Refer to Notes 10, 11, 12, and 20 for further information on accounting for interest income and interest expense related to investment securities, securities financing activities (i.e., securities purchased or sold under resale or repurchase agreements; securities borrowed; and securities loaned), loans and long-term debt, respectively.

The following table presents the components of interest income and interest expense:

Year ended December 31, (in millions)	2023			2022		2021
Interest income
Loans	$	83,384	(e)	$	52,736	$	41,537
Taxable securities	17,390			10,372		6,460
Non-taxable securities(a)	1,336			975		1,063
Total investment securities	18,726		(e)	11,347		7,523
Trading assets - debt instruments	15,950			9,053		6,825
Federal funds sold and securities purchased under resale agreements	15,079			4,632		958
Securities borrowed(b)	7,983			2,237		(385)
Deposits with banks	21,797			9,039		512
All other interest-earning assets(c)	7,669			3,763		894
Total interest income	$	170,588		$	92,807	$	57,864
Interest expense
Interest bearing deposits	$	40,016		$	10,082	$	531
Federal funds purchased and securities loaned or sold under repurchase agreements	13,259			3,721		274
Short-term borrowings	1,894			747		126
Trading liabilities - debt and all other interest-bearing liabilities(d)	9,396			3,246		257
Long-term debt	15,803			8,075		4,282
Beneficial interest issued by consolidated VIEs	953			226		83
Total interest expense	$	81,321		$	26,097	$	5,553
Net interest income	$	89,267		$	66,710	$	52,311
Provision for credit losses	9,320			6,389		(9,256)
Net interest income after provision for credit losses	$	79,947		$	60,321	$	61,567

(a)Represents securities that are tax-exempt for U.S. federal income tax purposes.

(b)Negative interest and rates reflect the net impact of interest earned offset by fees paid on client-driven prime brokerage securities borrowed transactions.

(c)Includes interest earned on brokerage-related held-for-investment customer receivables, which are classified in accrued interest and accounts receivable, and all other interest-earning assets, which are classified in other assets on the Consolidated balance sheets.

(d)All other interest-bearing liabilities includes interest expense on brokerage-related customer payables.

(e)Includes the accretion of the purchase discount on certain acquired loans and investment securities associated with First Republic. Refer to Note 34 for additional information.