Bank client receivables are comprised of loans originated or purchased by our Bank segment and include securities-based loans (“SBL”), corporate loans (commercial and industrial (“C&I”) loans, commercial real estate (“CRE”) loans, and real estate investment trust (“REIT”) loans), residential mortgage loans, and tax-exempt loans. These receivables are collateralized by first and, to a lesser extent, second mortgages on residential or other real property, other assets of the borrower, a pledge of revenue, securities or are unsecured. We segregate our loan portfolio into six loan portfolio segments: SBL, C&I, CRE, REIT, residential mortgage, and tax-exempt. See Note 2 of our 2023 Form 10-K for a discussion of accounting policies related to bank loans and the allowance for credit losses.

Loan balances in the following tables are presented at amortized cost (outstanding principal balance net of unamortized purchase discounts or premiums, unearned income, deferred origination fees and costs, and charge-offs), except for certain held for sale loans recorded at fair value. Bank loans are presented on our Condensed Consolidated Statements of Financial Condition at amortized cost (or fair value where applicable) less the allowance for credit losses (“ACL”). As it pertains to TriState Capital Bank’s loans acquired as of June 1, 2022, the amortized cost of such purchased loans reflects the fair value of the loans on the acquisition date, and as described further in Note 3 of our 2023 Form 10-K, the purchase discount on such loans is accreted to interest income over the weighted-average life of the underlying loans, which may vary based on prepayments.


$ in millions	December 31, 2023			September 30, 2023
SBL	$	14,647		$	14,606
C&I loans	10,503			10,406
CRE loans	7,331			7,221
REIT loans	1,697			1,668
Residential mortgage loans	8,861			8,662
Tax-exempt loans	1,411			1,541
Total loans held for investment	44,450			44,104
Held for sale loans	211			145
Total loans held for sale and investment	44,661			44,249
Allowance for credit losses	(479)			(474)
Bank loans, net (1)	$	44,182		$	43,775

ACL as a % of total loans held for investment	1.08		%	1.07		%
Accrued interest receivable on bank loans (included in “Other receivables, net”)	$	212		$	200

(1)Bank loans, net as of December 31, 2023 and September 30, 2023 are presented net of $37 million and $52 million, respectively, of net unamortized discount, unearned income, and deferred loan fees and costs. The net unamortized discount primarily arose from the acquisition date fair value purchase discount on bank loans acquired in the TriState Capital Holdings, Inc. acquisition. See Note 3 of our 2023 Form 10-K for additional information.

We originated or purchased $441 million and $802 million of loans held for sale during the three months ended December 31, 2023 and 2022, respectively. The majority of these loans were purchases of the guaranteed portions of Small Business Administration (“SBA”) loans that were initially classified as loans held for sale upon purchase and subsequently transferred to trading instruments once they had been securitized into pools. Proceeds from the sales of these loans held for sale and not securitized amounted to $102 million and $198 million during the three months ended December 31, 2023 and 2022, respectively. Net gains resulting from such sales were insignificant for each of the three months ended December 31, 2023 and 2022.


$ in millions	C&I loans		CRE loans		REIT loans		Residential mortgage loans		Total
Three months ended December 31, 2023
Purchases	$	206	$	—	$	—	$	45	$	251
Sales	$	119	$	—	$	—	$	—	$	119




Three months ended December 31, 2022
Purchases	$	163	$	39	$	24	$	190	$	416
Sales	$	—	$	—	$	—	$	—	$	—

Sales in the preceding table represent the recorded investment (i.e., net of charge-offs and discounts or premiums) of loans held for investment that were transferred to loans held for sale and subsequently sold to a third party during the respective period. As more fully described in Note 2 of our 2023 Form 10-K, corporate loan sales generally occur as part of our credit management activities.


$ in millions	30-89 days and accruing		90 days or more and accruing		Total past due and accruing		Nonaccrual with allowance		Nonaccrual with no allowance		Current and accruing		Total loans held for investment
December 31, 2023
SBL	$	7	$	—	$	7	$	—	$	—	$	14,640	$	14,647
C&I loans	3		—		3		64		—		10,436		10,503
CRE loans	—		—		—		81		12		7,238		7,331
REIT loans	—		—		—		—		—		1,697		1,697
Residential mortgage loans	5		—		5		—		7		8,849		8,861
Tax-exempt loans	—		—		—		—		—		1,411		1,411
Total loans held for investment	$	15	$	—	$	15	$	145	$	19	$	44,271	$	44,450

September 30, 2023
SBL	$	9	$	—	$	9	$	—	$	—	$	14,597	$	14,606
C&I loans	—		—		—		69		2		10,335		10,406
CRE loans	—		—		—		35		13		7,173		7,221
REIT loans	—		—		—		—		—		1,668		1,668
Residential mortgage loans	2		—		2		—		9		8,651		8,662
Tax-exempt loans	—		—		—		—		—		1,541		1,541
Total loans held for investment	$	11	$	—	$	11	$	104	$	24	$	43,965	$	44,104

In the normal course of business, we may modify the original terms of a loan agreement. In certain circumstances, we may agree to modify the original terms of a loan agreement to a borrower experiencing financial difficulty, which may include a borrower in default, financial distress, bankruptcy or other circumstances. Loan modifications to borrowers experiencing financial difficulty typically involve principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay (i.e., payment deferral greater than six months), or a term extension, or any combination thereof. Modified loans to borrowers experiencing financial difficulty are subject to our nonaccrual policies. Loans to borrowers experiencing financial difficulty which were modified during the three months ended December 31, 2023 were not significant.

Prior to September 30, 2023, loan modifications to borrowers experiencing financial difficulty, to the extent significant, were considered TDRs. On October 1, 2023, we adopted ASU 2022-02, which eliminated the recognition and measurement guidance for TDRs. See Note 2 for additional information about this guidance. As of September 30, 2023, TDRs were $21 million, $3 million, and $10 million for C&I loans, CRE loans and residential first mortgage loans, respectively.

A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the sale of the underlying collateral. Collateral-dependent loans are recorded based upon the fair value of the collateral less the estimated selling costs. The following table presents the amortized cost of our collateral-dependent loans and the nature of the collateral.


Loan type ($ in millions)	Nature of collateral	December 31, 2023		September 30, 2023

C&I loans	Commercial real estate and other business assets	$	9	$	11
CRE loans	Office, multi-family residential, healthcare, and industrial real estate	$	146	$	47

Residential mortgage loans	Single family homes	$	4	$	5

CRE collateral dependent loans as of December 31, 2023 included two loans that were placed on nonaccrual status with an associated allowance during the three months ended December 31, 2023. The recorded investments in residential mortgage loans secured by one-to-four family residential properties for which formal foreclosure proceedings were in process were $3 million and $4 million as of December 31, 2023 and September 30, 2023, respectively.

The credit quality of our bank loan portfolio is summarized monthly by management using internal risk ratings, which align with the standard asset classification system utilized by bank regulators. These classifications are divided into three groups: Not Classified (Pass), Special Mention, and Classified or Adverse Rating (Substandard, Doubtful and Loss). These terms are defined as follows:

Pass – Loans which are well protected by the current net worth and paying capacity of the obligor (or guarantors, if any) or by the fair value, less costs to acquire and sell, of any underlying collateral and generally are performing in accordance with the contractual terms.

Substandard – Loans which are inadequately protected by the current sound worth and paying capacity of the obligor or by the collateral pledged, if any. Loans with this classification are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected.

Doubtful – Loans which have all the weaknesses inherent in loans classified as substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently-known facts, conditions and values.

Loss – Loans which are considered by management to be uncollectible and of such little value that their continuance on our books as an asset, without establishment of a specific valuation allowance or charge-off, is not warranted. We do not have any loan balances within this classification because, in accordance with our accounting policy, loans, or a portion thereof considered to be uncollectible are charged-off prior to the assignment of this classification.


	As of and for the three months ended December 31, 2023
	Loans by origination fiscal year
$ in millions	2024		2023		2022		2021		2020		Prior		Revolving loans		Total
SBL
Risk rating:
Pass	$	31	$	47	$	19	$	82	$	36	$	74	$	14,339	$	14,628
Special mention	—		—		—		—		—		—		—		—
Substandard (1)	19		—		—		—		—		—		—		19
Doubtful	—		—		—		—		—		—		—		—
Total SBL	$	50	$	47	$	19	$	82	$	36	$	74	$	14,339	$	14,647
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



C&I loans
Risk rating:
Pass	$	138	$	732	$	1,206	$	1,067	$	877	$	3,457	$	2,784	$	10,261
Special mention	—		—		5		—		68		—		3		76
Substandard	—		—		—		29		62		59		16		166
Doubtful	—		—		—		—		—		—		—		—
Total C&I loans	$	138	$	732	$	1,211	$	1,096	$	1,007	$	3,516	$	2,803	$	10,503
Gross charge-offs	$	—	$	—	$	—	$	1	$	—	$	5	$	—	$	6



CRE loans
Risk rating:
Pass	$	131	$	1,182	$	2,317	$	1,107	$	739	$	1,411	$	255	$	7,142
Special mention	—		6		—		—		14		19		—		39
Substandard	—		—		—		5		32		113		—		150
Doubtful	—		—		—		—		—		—		—		—
Total CRE loans	$	131	$	1,188	$	2,317	$	1,112	$	785	$	1,543	$	255	$	7,331
Gross charge offs	$	—	$	—	$	—	$	—	$	—	$	2	$	—	$	2



REIT loans
Risk rating:
Pass	$	51	$	236	$	184	$	232	$	103	$	311	$	580	$	1,697
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total REIT loans	$	51	$	236	$	184	$	232	$	103	$	311	$	580	$	1,697
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



Residential mortgage loans
Risk rating:
Pass	$	323	$	1,747	$	2,857	$	1,588	$	903	$	1,388	$	33	$	8,839
Special mention	—		—		2		—		—		5		—		7
Substandard	—		—		2		—		—		13		—		15
Doubtful	—		—		—		—		—		—		—		—
Total residential mortgage loans	$	323	$	1,747	$	2,861	$	1,588	$	903	$	1,406	$	33	$	8,861
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



Tax-exempt loans
Risk rating:
Pass	$	—	$	57	$	270	$	160	$	54	$	870	$	—	$	1,411
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total tax-exempt loans	$	—	$	57	$	270	$	160	$	54	$	870	$	—	$	1,411
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—


	September 30, 2023
	Loans by origination fiscal year
$ in millions	2023		2022		2021		2020		2019		Prior		Revolving loans		Total
SBL
Risk rating:
Pass	$	74	$	18	$	83	$	40	$	15	$	59	$	14,293	$	14,582
Special mention	—		—		—		—		—		—		—		—
Substandard (1)	—		—		—		—		—		—		24		24
Doubtful	—		—		—		—		—		—		—		—
Total SBL	$	74	$	18	$	83	$	40	$	15	$	59	$	14,317	$	14,606




C&I loans
Risk rating:
Pass	$	672	$	1,148	$	1,091	$	965	$	1,020	$	2,675	$	2,564	$	10,135
Special mention	—		5		29		69		—		—		4		107
Substandard	—		—		—		62		17		65		17		161
Doubtful	—		—		—		—		—		3		—		3
Total C&I loans	$	672	$	1,153	$	1,120	$	1,096	$	1,037	$	2,743	$	2,585	$	10,406




CRE loans
Risk rating:
Pass	$	1,130	$	2,344	$	1,115	$	766	$	604	$	845	$	220	$	7,024
Special mention	7		—		—		14		5		55		—		81
Substandard	—		—		5		32		12		67		—		116
Doubtful	—		—		—		—		—		—		—		—
Total CRE loans	$	1,137	$	2,344	$	1,120	$	812	$	621	$	967	$	220	$	7,221




REIT loans
Risk rating:
Pass	$	258	$	200	$	214	$	101	$	172	$	176	$	547	$	1,668
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total REIT loans	$	258	$	200	$	214	$	101	$	172	$	176	$	547	$	1,668



Residential mortgage loans
Risk rating:
Pass	$	1,765	$	2,889	$	1,607	$	919	$	433	$	992	$	31	$	8,636
Special mention	—		—		2		—		2		5		—		9
Substandard	—		2		—		1		—		14		—		17
Doubtful	—		—		—		—		—		—		—		—
Total residential mortgage loans	$	1,765	$	2,891	$	1,609	$	920	$	435	$	1,011	$	31	$	8,662




Tax-exempt loans
Risk rating:
Pass	$	147	$	279	$	161	$	54	$	97	$	803	$	—	$	1,541
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total tax-exempt loans	$	147	$	279	$	161	$	54	$	97	$	803	$	—	$	1,541

We also monitor the credit quality of the residential mortgage loan portfolio utilizing FICO scores and loan-to-value (“LTV”) ratios. A FICO score measures a borrower’s creditworthiness by considering factors such as payment and credit history. LTV measures the carrying value of the loan as a percentage of the value of the property securing the loan. The following table presents the held for investment residential mortgage loan portfolio by LTV ratio at origination and by FICO score.


	December 31, 2023
	Loans by origination fiscal year
$ in millions	2024		2023		2022		2021		2020		Prior		Revolving loans		Total
FICO score:
Below 600	$	—	$	4	$	11	$	3	$	3	$	16	$	—	$	37
600 - 699	23		83		102		65		33		80		3		389
700 - 799	240		1,280		1,581		867		525		770		22		5,285
800 +	60		376		1,167		651		341		537		7		3,139
FICO score not available	—		4		—		2		1		3		1		11
Total	$	323	$	1,747	$	2,861	$	1,588	$	903	$	1,406	$	33	$	8,861

LTV ratio:
Below 80%	$	232	$	1,230	$	2,196	$	1,241	$	703	$	1,073	$	32	$	6,707
80%+	91		517		665		347		200		333		1		2,154
Total	$	323	$	1,747	$	2,861	$	1,588	$	903	$	1,406	$	33	$	8,861


	September 30, 2023
	Loans by origination fiscal year
$ in millions	2022		2021		2020		2019		2018		Prior		Revolving loans		Total
FICO score:
Below 600	$	7	$	1	$	3	$	2	$	3	$	55	$	—	$	71
600 - 699	99		154		106		83		30		79		4		555
700 - 799	1,381		2,327		1,218		666		320		609		20		6,541
800 +	274		407		279		168		77		265		6		1,476
FICO score not available	4		2		3		1		5		3		1		19
Total	$	1,765	$	2,891	$	1,609	$	920	$	435	$	1,011	$	31	$	8,662

LTV ratio:
Below 80%	$	1,244	$	2,218	$	1,257	$	716	$	323	$	780	$	29	$	6,567
80%+	521		673		352		204		112		231		2		2,095
Total	$	1,765	$	2,891	$	1,609	$	920	$	435	$	1,011	$	31	$	8,662


$ in millions	SBL			C&I loans			CRE loans			REIT loans			Residential mortgage loans			Tax-exempt loans			Total
Three months ended December 31, 2023














Balance at beginning of period	$	7		$	214		$	161		$	16		$	74		$	2		$	474


Provision/(benefit) for credit losses	—			3			14			1			(6)			—			12

Net (charge-offs)/recoveries:
Charge-offs	—			(6)			(2)			—			—			—			(8)
Recoveries	—			—			—			—			—			—			—
Net (charge-offs)/recoveries	—			(6)			(2)			—			—			—			(8)
Foreign exchange translation adjustment	—			—			1			—			—			—			1
Balance at end of period	$	7		$	211		$	174		$	17		$	68		$	2		$	479
ACL by loan portfolio segment as a % of total ACL	1.5		%	44.1		%	36.3		%	3.5		%	14.2		%	0.4		%	100.0		%

Three months ended December 31, 2022
Balance at beginning of period	$	3		$	226		$	87		$	21		$	57		$	2		$	396



Provision/(benefit) for credit losses	1			—			2			(6)			17			—			14

Net (charge-offs)/recoveries:
Charge-offs	—			(4)			(1)			—			—			—			(5)
Recoveries	—			—			3			—			—			—			3
Net (charge-offs)/recoveries	—			(4)			2			—			—			—			(2)
Foreign exchange translation adjustment	—			—			—			—			—			—			—
Balance at end of period	$	4		$	222		$	91		$	15		$	74		$	2		$	408
ACL by loan portfolio segment as a % of total ACL	1.0		%	54.4		%	22.3		%	3.7		%	18.1		%	0.5		%	100.0		%

The allowance for credit losses on held for investment bank loans increased $5 million during the three months ended December 31, 2023 primarily resulting from provisions for credit losses of $12 million, partially offset by net charge-offs of certain loans during the period. The provision for credit losses for the three months ended December 31, 2023 primarily reflected the impacts of specific reserves in our C&I and CRE loan portfolios, loan downgrades, and charge-offs, partially offset by the favorable impact of loan repayments and sales, which had a larger impact on the current quarter expense than provisions on new loans.

Loans to financial advisors are primarily comprised of loans originated as a part of our recruiting activities. See Note 2 of our 2023 Form 10-K for a discussion of our accounting policies related to loans to financial advisors and the related allowance for credit losses. The following table presents the balances for our loans to financial advisors and the related accrued interest receivable.


$ in millions	December 31, 2023			September 30, 2023
Affiliated with the firm as of period-end (1)	$	1,206		$	1,158
No longer affiliated with the firm as of period-end (2)	13			10
Total loans to financial advisors	1,219			1,168
Allowance for credit losses	(35)			(32)
Loans to financial advisors, net	$	1,184		$	1,136
Accrued interest receivable on loans to financial advisors (included in “Other receivables, net”)	$	6		$	6
Allowance for credit losses as a percent of total loans to financial advisors	2.87		%	2.74		%