Investment Securities (Tables)

9 Months Ended

Sep. 30, 2023

Investments, Debt and Equity Securities [Abstract]

The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity securities were as follows.



	September 30, 2023								December 31, 2022
	Amortized cost		Gross unrealized				Fair value		Amortized cost		Gross unrealized				Fair value
($ in millions)			gains		losses						gains		losses
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies	$	2,280	$	—	$	(289)	$	1,991	$	2,272	$	—	$	(256)	$	2,016
U.S. States and political subdivisions	729		—		(117)		612		841		1		(82)		760
Foreign government	175		—		(16)		159		158		—		(12)		146
Agency mortgage-backed residential (a)	18,434		—		(3,798)		14,636		19,668		3		(3,038)		16,633
Mortgage-backed residential	4,858		—		(985)		3,873		5,154		—		(855)		4,299
Agency mortgage-backed commercial (a)	4,497		—		(1,031)		3,466		4,380		—		(845)		3,535

Asset-backed	370		—		(16)		354		459		—		(26)		433
Corporate debt	1,922		—		(219)		1,703		1,931		1		(213)		1,719
Total available-for-sale securities (b) (c) (d) (e) (f)	$	33,265	$	—	$	(6,471)	$	26,794	$	34,863	$	5	$	(5,327)	$	29,541


Held-to-maturity securities
Debt securities
Agency mortgage-backed residential	$	1,013	$	—	$	(234)	$	779	$	1,062	$	—	$	(178)	$	884

Total held-to-maturity securities (f) (g)	$	1,013	$	—	$	(234)	$	779	$	1,062	$	—	$	(178)	$	884

(a)Fair value includes a $148 million liability and a $12 million liability for agency mortgage-backed residential securities and an $86 million liability and $15 million asset for agency mortgage-backed commercial securities related to basis adjustments for securities in closed portfolios with active hedges under the portfolio layer method at September 30, 2023, and December 31, 2022, respectively. These basis adjustments would be allocated to the amortized cost of specific securities within the pool if the hedge was dedesignated. Refer to Note 18 for additional information.

(b)Certain available-for-sale securities are included in fair value hedging relationships. Refer to Note 18 for additional information.

(c)Certain entities related to our Insurance operations are required to deposit securities with state regulatory authorities. These deposited securities totaled $12 million at both September 30, 2023, and December 31, 2022.

(d)Available-for-sale securities with a fair value of $4.4 billion and $3.9 billion were pledged as collateral at September 30, 2023, and December 31, 2022, respectively. This primarily included $3.1 billion and $3.0 billion pledged to secure advances from the FHLB at September 30, 2023, and December 31, 2022, respectively. This also included securities pledged for other purposes as required by contractual obligations or law, under which agreements we granted the counterparty the right to sell or pledge $1.3 billion and $899 million of the underlying available-for-sale securities at September 30, 2023, and December 31, 2022, respectively.

(e)Totals do not include accrued interest receivable, which was $86 million and $91 million at September 30, 2023, and December 31, 2022, respectively. Accrued interest receivable is included in other assets on our Condensed Consolidated Balance Sheet.

(f)There was no allowance for credit losses recorded at both September 30, 2023, or December 31, 2022, as management determined that there were no expected credit losses in our portfolio of available-for-sale and held-to-maturity securities.

(g)Totals do not include accrued interest receivable, which was $2 million at both September 30, 2023, and December 31, 2022. Accrued interest receivable is included in other assets on our Condensed Consolidated Balance Sheet.

Schedule of Investments Classified by Contractual Maturity Date

The maturity distribution of debt securities outstanding is summarized in the following tables based upon contractual maturities. Call or prepayment options may cause actual maturities to differ from contractual maturities.


	Total				Due in one year or less				Due after one year through five years				Due after five years through ten years				Due after ten years
($ in millions)	Amount		Yield		Amount		Yield		Amount		Yield		Amount		Yield		Amount		Yield
September 30, 2023
Fair value of available-for-sale securities (a)
U.S. Treasury and federal agencies	$	1,991	1.6	%	$	23	2.0	%	$	1,270	1.4	%	$	698	1.9	%	$	—	—	%
U.S. States and political subdivisions	612		3.2		5		2.2		44		2.4		112		3.6		451		3.2
Foreign government	159		2.0		19		1.4		72		2.1		68		2.2		—		—
Agency mortgage-backed residential (b)	14,636		2.6		—		—		11		1.9		33		2.5		14,592		2.6
Mortgage-backed residential	3,873		2.8		—		—		—		—		12		2.9		3,861		2.8
Agency mortgage-backed commercial (b)	3,466		2.3		—		—		116		3.3		1,474		2.3		1,876		2.1

Asset-backed	354		1.8		—		—		349		1.7		5		3.9		—		—
Corporate debt	1,703		2.6		172		2.3		908		2.6		614		2.7		9		5.8
Total available-for-sale securities	$	26,794	2.5		$	219	2.2		$	2,770	1.9		$	3,016	2.4		$	20,789	2.6
Amortized cost of available-for-sale securities	$	33,265			$	224			$	3,033			$	3,662			$	26,346
Amortized cost of held-to-maturity securities
Agency mortgage-backed residential	$	1,013	2.8	%	$	—	—	%	$	—	—	%	$	—	—	%	$	1,013	2.8	%

Total held-to-maturity securities	$	1,013	2.8		$	—	—		$	—	—		$	—	—		$	1,013	2.8
December 31, 2022
Fair value of available-for-sale securities (a)
U.S. Treasury and federal agencies	$	2,016	1.6	%	$	—	—	%	$	716	1.3	%	$	1,300	1.7	%	$	—	—	%
U.S. States and political subdivisions	760		3.2		26		2.7		60		2.7		112		3.3		562		3.2
Foreign government	146		1.8		13		0.8		74		1.8		59		1.9		—		—
Agency mortgage-backed residential (b)	16,633		2.6		—		—		—		—		27		2.0		16,606		2.6
Mortgage-backed residential	4,299		2.8		—		—		—		—		14		2.9		4,285		2.8
Agency mortgage-backed commercial (b)	3,535		2.2		—		—		66		3.1		1,234		2.1		2,235		2.1

Asset-backed	433		1.7		—		—		401		1.7		25		1.8		7		3.5
Corporate debt	1,719		2.4		86		2.4		912		2.3		705		2.6		16		4.9
Total available-for-sale securities	$	29,541	2.5		$	125	2.3		$	2,229	1.9		$	3,476	2.1		$	23,711	2.6
Amortized cost of available-for-sale securities	$	34,863			$	126			$	2,403			$	4,048			$	28,286
Amortized cost of held-to-maturity securities
Agency mortgage-backed residential	$	1,062	2.8	%	$	—	—	%	$	—	—	%	$	—	—	%	$	1,062	2.8	%

Total held-to-maturity securities	$	1,062	2.8		$	—	—		$	—	—		$	—	—		$	1,062	2.8

(a)Yield is calculated using the effective yield of each security at the end of the period, weighted based on the market value. The effective yield considers the contractual coupon and amortized cost, and excludes expected capital gains and losses.

(b)Fair value includes a $148 million liability and a $12 million liability for agency mortgage-backed residential securities and an $86 million liability and $15 million asset for agency mortgage-backed commercial securities related to basis adjustments for securities in closed portfolios with active hedges under the portfolio layer method at September 30, 2023, and December 31, 2022, respectively. These basis adjustments would be allocated to the amortized cost of specific securities within the pool if the hedge was dedesignated. Refer to Note 18 for additional information.

Schedule of Investment Income

The following table presents interest and dividends on investment securities.


	Three months ended September 30,				Nine months ended September 30,
($ in millions)	2023		2022		2023		2022
Taxable interest	$	246	$	196	$	692	$	556
Taxable dividends	5		4		12		12
Interest and dividends exempt from U.S. federal income tax	5		6		16		16
Interest and dividends on investment securities	$	256	$	206	$	720	$	584

Schedule of Realized Gain (Loss)

The following table presents gross gains and losses realized upon the sales of available-for-sale securities, and net gains or losses on equity securities held during the period.


	Three months ended September 30,				Nine months ended September 30,
($ in millions)	2023		2022		2023		2022
Available-for-sale securities
Gross realized gains	$	—	$	2	$	5	$	23

Net realized gain on available-for-sale securities	—		2		5		23
Net realized gain on equity securities	15		5		21		67
Net unrealized (loss) gain on equity securities	(56)		(61)		33		(263)
Other (loss) gain on investments, net	$	(41)	$	(54)	$	59	$	(173)

Schedule of Held to Maturity Debt Securities by Credit Quality

The following table presents the credit quality of our held-to-maturity securities, based on the latest available information as of September 30, 2023, and December 31, 2022. The credit ratings are sourced from nationally recognized statistical rating organizations, which include S&P, Moody’s, and Fitch. The ratings presented are a composite of the ratings sourced from the agencies or, if the ratings cannot be sourced from the agencies, are based on the asset type of the particular security. All our held-to-maturity securities were current in their payment of principal and interest as of both September 30, 2023, and December 31, 2022. We have not recorded any interest income reversals on our held-to-maturity securities during the nine months ended September 30, 2023, or 2022.


	September 30, 2023		December 31, 2022
($ in millions)	AA		Total (a)		AA		Total (a)
Debt securities
Agency mortgage-backed residential	$	1,013	$	1,013	$	1,062	$	1,062

Total held-to-maturity securities	$	1,013	$	1,013	$	1,062	$	1,062

(a)Rating agencies indicate that they base their ratings on many quantitative and qualitative factors, which may include capital adequacy, liquidity, asset quality, business mix, level and quality of earnings, and the current operating, legislative, and regulatory environment. A credit rating is not a recommendation to buy, sell, or hold securities, and the ratings are subject to revision or withdrawal at any time by the assigning rating agency.

Schedule of Available-for-Sale Securities in Unrealized Loss Position

The following table summarizes available-for-sale securities in an unrealized loss position, which we evaluated to determine if a credit loss exists requiring the recognition of an allowance for credit losses. For additional information on our methodology, refer to Note 1 to the Consolidated Financial Statements in our 2022 Annual Report on Form 10-K. As of September 30, 2023, and December 31, 2022, we did not have the intent to sell the available-for-sale securities with an unrealized loss position and we do not believe it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. We have not recorded any interest income reversals on our available-for-sale securities during the nine months ended September 30, 2023, or 2022.


	September 30, 2023								December 31, 2022

	Less than 12 months				12 months or longer				Less than 12 months				12 months or longer
($ in millions)	Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies	$	—	$	—	$	1,991	$	(289)	$	529	$	(68)	$	1,487	$	(188)
U.S. States and political subdivisions	139		(6)		465		(111)		547		(55)		135		(27)
Foreign government	25		(2)		135		(14)		75		(4)		71		(8)
Agency mortgage-backed residential (a)	356		(23)		14,280		(3,775)		7,472		(892)		8,978		(2,146)
Mortgage-backed residential	151		(6)		3,716		(979)		1,985		(289)		2,287		(566)
Agency mortgage-backed commercial (a)	172		(10)		3,247		(1,021)		996		(124)		2,535		(721)

Asset-backed	18		—		322		(16)		162		(4)		272		(22)
Corporate debt	147		(6)		1,550		(213)		782		(67)		895		(146)
Total available-for-sale securities	$	1,008	$	(53)	$	25,706	$	(6,418)	$	12,548	$	(1,503)	$	16,660	$	(3,824)

(a)Includes basis adjustments for certain securities that are included in closed portfolios with active hedges under the portfolio layer method at September 30, 2023, and December 31, 2022. The basis adjustments would be allocated to the amortized cost of specific securities within the pool if the hedge was dedesignated. Refer to Note 18 for additional information.