Loans and Allowance for Credit Losses: Loans and Unfunded Credit Commitments (Tables)

12 Months Ended

Dec. 31, 2021

Composition of Loans at Amortized Cost Basis Broken Out by Risk-Based Segment

The composition of loans at amortized cost basis broken out by class of financing receivable at December 31, 2021 and December 31, 2020, respectively, is presented in the following table:


	December 31,
(Dollars in millions)	2021		2020
Global fund banking	$	37,958	$	25,543
Investor dependent:
Early stage	1,593		1,486
Growth stage	3,951		3,486
Total investor dependent	5,544		4,972
Cash flow dependent - SLBO	1,798		1,989
Innovation C&I	6,673		5,136
Private bank (4)	8,743		4,901
CRE (4)	2,670		—
Premium wine (4)	985		1,053
Other C&I	1,257		—
Other (4)	317		28
PPP	331		1,559
Total loans (1) (2) (3)	$	66,276	$	45,181
ACL	(422)		(448)
Net loans	$	65,854	$	44,733

(1)Total loans at amortized cost is net of unearned income of $250 million and $226 million at December 31, 2021 and December 31, 2020, respectively.

(2)Included within our total loan portfolio are credit card loans of $583 million and $400 million at December 31, 2021 and December 31, 2020, respectively.

(3)Included within our total loan portfolio are construction loans of $367 million and $118 million at December 31, 2021 and December 31, 2020, respectively.

(4)Of our total loans, the table below includes those secured by real estate at amortized cost at December 31, 2021 and December 31, 2020 and were comprised of the following:


	December 31,
(Dollars in millions)	2021		2020
Real estate secured loans:
Private bank:
Loans for personal residence	$	6,939	$	3,392
Loans to eligible employees	455		481
Home equity lines of credit	130		43
Other	135		143
Total private bank loans secured by real estate	$	7,659	$	4,059
CRE:
Multifamily and residential investment	$	1,021	$	—
Retail	524		—
Office and medical	499		—
Manufacturing, industrial and warehouse	336		—
Hospitality	142		—
Other	148		—
Total CRE loans secured by real estate	$	2,670	$	—
Premium wine	793		824
Other	334		57
Total real estate secured loans	$	11,456	$	4,940

Credit Quality Indicators, Broken Out by Risk-Based Segments and Vintage Year

The following tables summarize the credit quality indicators, broken out by class of financing receivables and vintage year, as of December 31, 2021 and December 31, 2020.


	Term Loans by Origination Year
December 31, 2021 (Dollars in millions)	2021		2020		2019		2018		2017		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Unallocated (1)		Total
Global fund banking:
Risk rating:
Pass	$	764	$	115	$	36	$	6	$	8	$	4	$	36,955	$	—	$	—	$	37,888
Criticized	50		18		—		—		—		1		1		—		—		70
Nonperforming	—		—		—		—		—		—		—		—		—		—
Total global fund banking	$	814	$	133	$	36	$	6	$	8	$	5	$	36,956	$	—	$	—	$	37,958
Investor dependent:
Early stage:
Risk rating:
Pass	$	754	$	287	$	122	$	26	$	6	$	1	$	171	$	—	$	—	$	1,367
Criticized	64		87		30		5		—		—		29		—		—		215
Nonperforming	2		5		3		—		—		—		1		—		—		11
Total early stage	$	820	$	379	$	155	$	31	$	6	$	1	$	201	$	—	$	—	$	1,593
Growth stage:
Risk rating:
Pass	$	2,072	$	910	$	265	$	78	$	14	$	1	$	286	$	5	$	—	$	3,631
Criticized	159		85		27		6		3		—		34		—		—		314
Nonperforming	2		—		1		2		—		—		1		—		—		6
Total growth stage	$	2,233	$	995	$	293	$	86	$	17	$	1	$	321	$	5	$	—	$	3,951
Total investor dependent	$	3,053	$	1,374	$	448	$	117	$	23	$	2	$	522	$	5	$	—	$	5,544
Cash flow dependent - SLBO:
Risk rating:
Pass	$	875	$	384	$	252	$	72	$	76	$	2	$	35	$	—	$	—	$	1,696
Criticized	—		—		20		25		—		13		10		—		—		68
Nonperforming	—		—		12		10		7		—		5		—		—		34
Total cash flow dependent - SLBO	$	875	$	384	$	284	$	107	$	83	$	15	$	50	$	—	$	—	$	1,798
Innovation C&I:
Risk rating:
Pass	$	2,230	$	1,058	$	288	$	123	$	58	$	—	$	2,411	$	—	$	—	$	6,168
Criticized	64		130		62		12		—		—		236		—		—		504
Nonperforming	—		—		—		—		—		—		1		—		—		1
Total Innovation C&I	$	2,294	$	1,188	$	350	$	135	$	58	$	—	$	2,648	$	—	$	—	$	6,673
Private bank:
Risk rating:
Pass	$	2,952	$	2,015	$	1,122	$	520	$	432	$	952	$	705	$	8	$	—	$	8,706
Criticized	—		—		2		—		2		9		3		—		—		16
Nonperforming	—		—		2		9		—		8		2		—		—		21
Total private bank	$	2,952	$	2,015	$	1,126	$	529	$	434	$	969	$	710	$	8	$	—	$	8,743
CRE
Risk rating:
Pass	$	326	$	215	$	344	$	155	$	236	$	868	$	110	$	2	$	—	$	2,256
Criticized	3		39		114		37		47		139		18		12		—		409
Nonperforming	—		—		5		—		—		—		—		—		—		5
Total CRE	$	329	$	254	$	463	$	192	$	283	$	1,007	$	128	$	14	$	—	$	2,670
Premium wine:
Risk rating:
Pass	$	217	$	112	$	156	$	69	$	71	$	162	$	125	$	34	$	—	$	946
Criticized	1		7		11		9		—		—		11		—		—		39
Nonperforming	—		—		—		—		—		—		—		—		—		—
Total Premium wine	$	218	$	119	$	167	$	78	$	71	$	162	$	136	$	34	$	—	$	985
Other C&I
Risk rating:
Pass	$	181	$	175	$	82	$	86	$	28	$	301	$	350	$	11	$	—	$	1,214


Criticized	5		6		6		7		2		—		8		5		—		39
Nonperforming	—		—		—		2		—		1		1		—		—		4
Total other C&I	$	186	$	181	$	88	$	95	$	30	$	302	$	359	$	16	$	—	$	1,257
Other:
Risk rating:
Pass	$	61	$	144	$	82	$	20	$	14	$	—	$	7	$	—	$	(21)	$	307
Criticized	—		7		1		—		2		—		—		—		—		10
Nonperforming	—		—		—		—		—		—		—		—		—		—
Total other	$	61	$	151	$	83	$	20	$	16	$	—	$	7	$	—	$	(21)	$	317
PPP:
Risk rating:
Pass	$	226	$	72	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	298
Criticized	22		9		—		—		—		—		—		—		—		31
Nonperforming	2		—		—		—		—		—		—		—		—		2
Total PPP	$	250	$	81	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	331
Total loans	$	11,032	$	5,880	$	3,045	$	1,279	$	1,006	$	2,462	$	41,516	$	77	$	(21)	$	66,276

(1) These amounts consist of fees and clearing items that have not yet been allocated at the loan level.


	Term Loans by Origination Year
December 31, 2020 (Dollars in millions)	2020		2019		2018		2017		2016		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total
Global fund banking:
Risk rating:
Pass	$	440	$	48	$	69	$	23	$	2	$	6	$	24,947	$	2	$	25,537
Criticized	—		—		—		—		—		—		—		6		6
Nonperforming	—		—		—		—		—		—		—		—		—
Total global fund banking	$	440	$	48	$	69	$	23	$	2	$	6	$	24,947	$	8	$	25,543
Investor dependent:
Early stage:
Risk rating:
Pass	$	667	$	370	$	121	$	32	$	1	$	1	$	96	$	1	$	1,289
Criticized	47		73		26		10		4		—		19		—		179
Nonperforming	2		9		5		1		—		—		1		—		18
Total early stage	$	716	$	452	$	152	$	43	$	5	$	1	$	116	$	1	$	1,486
Growth stage:
Risk rating:
Pass	$	1,746	$	696	$	316	$	61	$	5	$	9	$	325	$	8	$	3,166
Criticized	65		103		56		9		—		7		47		—		287
Nonperforming	17		3		4		3		—		—		6		—		33
Total growth stage	$	1,828	$	802	$	376	$	73	$	5	$	16	$	378	$	8	$	3,486
Total investor dependent	$	2,544	$	1,254	$	528	$	116	$	10	$	17	$	494	$	9	$	4,972
Cash flow dependent - SLBO:
Risk rating:
Pass	$	791	$	452	$	274	$	167	$	37	$	—	$	75	$	—	$	1,796
Criticized	—		70		39		22		13		—		9		—		153
Nonperforming	—		12		16		7		—		—		5		—		40
Total cash flow dependent - SLBO	$	791	$	534	$	329	$	196	$	50	$	—	$	89	$	—	$	1,989
Innovation C&I:
Risk rating:
Pass	$	1,718	$	703	$	378	$	152	$	39	$	—	$	1,791	$	1	$	4,782
Criticized	75		72		34		4		—		—		163		—		348
Nonperforming	—		—		5		—		—		—		1		—		6
Total Innovation C&I	$	1,793	$	775	$	417	$	156	$	39	$	—	$	1,955	$	1	$	5,136
Private bank:
Risk rating:
Pass	$	1,878	$	1,153	$	394	$	353	$	295	$	406	$	382	$	1	$	4,862


Criticized	3		10		5		1		5		8		1		—		33
Nonperforming	—		—		3		—		—		2		1		—		6
Total private bank	$	1,881	$	1,163	$	402	$	354	$	300	$	416	$	384	$	1	$	4,901
Premium wine:
Risk rating:
Pass	$	127	$	194	$	71	$	79	$	115	$	154	$	135	$	36	$	911
Criticized	18		24		36		10		13		6		34		—		141
Nonperforming	—		—		—		—		1		—		—		—		1
Total Premium wine	$	145	$	218	$	107	$	89	$	129	$	160	$	169	$	36	$	1,053
Other:
Risk rating:
Pass	$	—	$	16	$	11	$	—	$	—	$	1	$	—	$	—	$	28
Criticized	—		—		—		—		—		—		—		—		—
Nonperforming	—		—		—		—		—		—		—		—		—
Total other	$	—	$	16	$	11	$	—	$	—	$	1	$	—	$	—	$	28
PPP:
Risk rating:
Pass	$	1,456	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,456
Criticized	103		—		—		—		—		—		—		—		103
Nonperforming	—		—		—		—		—		—		—		—		—
Total PPP	$	1,559	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1,559
Total loans	$	9,153	$	4,008	$	1,863	$	934	$	530	$	600	$	28,038	$	55	$	45,181

Activity Relating to Our Allowance for Credit Losses for Loans

The following tables summarize the activity relating to our ACL for loans for 2021, 2020 and 2019 broken out by portfolio segment:


Year ended December 31, 2021	Beginning Balance December 31, 2020		Initial Allowance on PCD Loans		Charge-offs		Recoveries		Provision (Reduction) for Loans (1)		Ending Balance December 31, 2021
(Dollars in millions)
Global fund banking (2)	$	46	$	—	$	(80)	$	—	$	101	$	67
Investor dependent	213		—		(46)		18		(39)		146
Cash flow dependent and Innovation C&I	125		—		(8)		6		(5)		118
Private bank	53		1		(3)		—		(18)		33
CRE	—		17		—		—		19		36
Other C&I	—		4		—		—		10		14
Premium wine and other	9		—		(1)		—		—		8
PPP	2		—		—		—		(2)		—
Total ACL	$	448	$	22	$	(138)	$	24	$	66	$	422

(1)The provision for loans for the year ended December 31, 2021 includes a post-combination initial provision of $44 million related to non-PCD loans from the Boston Private acquisition.

(2)Global fund banking activity for the year ended December 31, 2021 includes the impact of an $80 million charge-off related to fraudulent activity on one loan as disclosed in previous filings.


Year ended December 31, 2020	Beginning Balance December 31, 2019		Impact of Adopting ASC 326		Charge-offs		Recoveries		Provision (Reduction) for Loans		Foreign Currency Translation Adjustments		Ending Balance December 31, 2020
(Dollars in millions)
Global fund banking	$	107	$	(70)	$	—	$	—	$	9	$	—	$	46
Investor dependent	82		72		(89)		25		125		(2)		213
Cash flow dependent and Innovation C&I	81		(1)		(11)		3		53		—		125
Private bank	22		12		(2)		—		21		—		53
Premium wine and other	13		12		(1)		1		(21)		5		9
PPP	—		—		—		—		2		—		2
Total ACL	$	305	$	25	$	(103)	$	29	$	189	$	3	$	448


Year ended December 31, 2019	Beginning Balance at December 31, 2018		Charge-offs		Recoveries		Provision (Reduction) for Loans		Foreign Currency Translation Adjustments		Ending Balance at December 31, 2019
(Dollars in millions)
Global fund banking	$	94	$	(2)	$	2	$	13	$	—	$	107
Total investor dependent	72		(85)		14		81		—		82
Cash flow dependent and Innovation C&I	88		(3)		5		(9)		—		81
Private bank	21		(1)		—		2		—		22
Premium wine and other	7		(2)		—		7		1		13
Total ACL	$	282	$	(93)	$	21	$	94	$	1	$	305

Aging of Gross Loans, Broken out by Portfolio Segment and Class of Financing Receivable

The following table summarizes the aging of our loans broken out by class of financing receivables as of December 31, 2021 and December 31, 2020:


(Dollars in millions)	30 - 59 Days Past Due		60 - 89 Days Past Due		Equal to or Greater Than 90 Days Past Due		Total Past Due		Current		Total		Loans Past Due 90 Days or More Still Accruing Interest
December 31, 2021:
Global fund banking	$	—	$	—	$	—	$	—	$	37,958	$	37,958	$	—
Investor dependent:
Early stage	6		5		—		11		1,582		1,593		—
Growth stage	16		—		—		16		3,935		3,951		—
Total investor dependent	22		5		—		27		5,517		5,544		—
Cash flow dependent - SLBO	—		—		—		—		1,798		1,798		—
Innovation C&I	7		—		7		14		6,659		6,673		7
Private bank	28		1		12		41		8,702		8,743		—
CRE	1		—		—		1		2,669		2,670		—
Premium wine	3		—		—		3		982		985		—
Other C&I	1		2		1		4		1,253		1,257		—
Other	—		—		—		—		317		317		—
PPP	1		—		—		1		330		331		—
Total loans (1)	$	63	$	8	$	20	$	91	$	66,185	$	66,276	$	7
December 31, 2020:
Global fund banking	$	28	$	—	$	—	$	28	$	25,515	$	25,543	$	—
Investor dependent:
Early stage	6		2		—		8		1,478		1,486		—
Growth stage	11		—		1		12		3,474		3,486		—
Total investor dependent	17		2		1		20		4,952		4,972		—
Cash flow dependent - SLBO	—		—		—		—		1,989		1,989		—
Innovation C&I	7		1		—		8		5,128		5,136		—
Private bank	4		4		—		8		4,893		4,901		—
Premium wine	3		—		1		4		1,049		1,053		—
Other	—		—		—		—		28		28		—
PPP	—		—		—		—		1,559		1,559		—
Total loans	$	59	$	7	$	2	$	68	$	45,113	$	45,181	$	—

Nonaccrual Loans with No Allowance for Credit Loss

The following table summarizes our nonaccrual loans with no ACL at December 31, 2021 and 2020:


	December 31, 2021				December 31, 2020
(Dollars in millions)	Nonaccrual Loans		Nonaccrual Loans with no ACL		Nonaccrual Loans		Nonaccrual Loans with no ACL
Investor dependent:
Early stage	$	11	$	—	$	18	$	—
Growth stage	6		—		33		3
Total investor dependent	17		—		51		3
Cash flow dependent - SLBO	34		—		40		—
Innovation C&I	1		1		6		1
Private bank	21		8		6		3
CRE	5		—		—		—
Premium wine	—		—		1		1
Other C&I	4		—		—		—
PPP	2		—		—		—
Total nonaccrual loans (1)	$	84	$	9	$	104	$	8

(1)Nonaccrual loans at December 31, 2021 include $20 million of loans that were acquired from Boston Private.

Summary of Loans Modified in Troubled Debt Restructurings ("TDRs") by Portfolio Segment and Class of Financing Receivables

The following table summarizes our loans modified in TDRs, broken out by class of financing receivables, at December 31, 2021 and 2020:


(Dollars in millions)	December 31, 2021		December 31, 2020
Loans modified in TDRs:
Investor dependent:
Early stage	$	12	$	7
Growth stage	3		29
Total investor dependent	15		36
Cash flow dependent - SLBO	34		22
Innovation C&I	—		1
Private bank	12		—
CRE	33		—
Premium wine	—		2
Other C&I	2		—
Total loans modified in TDRs during the period (1)	$	96	$	61

(1)Loans modified in TDRs at December 31, 2021 include 51 loans with a total balance of $47 million that were acquired from Boston Private.

Recorded Investment in Loans Modified in TDRs

The following table summarizes the recorded investment in loans modified in TDRs, broken out by class of financing receivables, for modifications made during 2021, 2020 and 2019:


	Year ended December 31,
(Dollars in millions)	2021		2020		2019
Loans modified in TDRs during the period:
Investor dependent:
Early stage	$	12	$	6	$	9
Growth stage	—		26		20
Total investor dependent	12		32		29
Cash flow dependent - SLBO	12		22		48
Innovation C&I	—		1		—
Private bank	4		—		2
CRE	29		—		—
Premium wine	—		1		11


Total loans modified in TDRs during the period (1) (2) (3)	$	57	$	56	$	90

(1)For the years ended December 31, 2021 and December 31, 2020, loan amounts are disclosed using the amortized cost basis as a result of the adoption of CECL. Loan amounts for the year ended December 31, 2019, are disclosed using the gross basis in accordance with the previous methodology.

(2)Loans modified in TDRs during 2021 include $33 million of loans acquired from Boston Private that were modified in TDRs.

(3)There were $6 million, $31 million and $11 million of partial charge-offs during 2021, 2020 and 2019, respectively.

Recorded Investment in Loans Modified in TDRs within Previous 12 months Subsequently Defaulted

The following table summarizes the recorded investment in loans modified in TDRs within the previous 12 months that subsequently defaulted during 2021, 2020 and 2019:


	Year ended December 31,
(Dollars in millions)	2021		2020		2019
TDRs modified within the previous 12 months that defaulted during the period:

Investor dependent

Growth stage	$	—	$	—	$	11
Total investor dependent	—		—		11
Cash flow dependent - SLBO	—		—		37


Premium wine	—		1		—


Total TDRs modified within the previous 12 months that defaulted in the period (1)	$	—	$	1	$	48

Allowance for Unfunded Commitments

The following table summarizes the activity relating to our ACL for unfunded credit commitments for 2021, 2020 and 2019:


	December 31,
(Dollars in millions)	2021		2020		2019
ACL: unfunded credit commitments, beginning balance	$	121	$	68	$	55
Impact of adopting ASC 326	—		23		—
Provision for credit losses (1)	50		30		13

ACL: unfunded credit commitments, ending balance (2)	$	171	$	121	$	68

(1)The provision for credit losses for unfunded credit commitments for 2021 includes a post-combination initial provision of $2 million related to commitments acquired from Boston Private.

(2)The “ACL: unfunded credit commitments” is included as a component of “other liabilities” on our consolidated balance sheets. See Note 21—“Off-Balance Sheet Arrangements, Guarantees and Other Commitments” for additional disclosures related to our commitments to extend credit.