BANK LOANS, NET (Tables)

9 Months Ended

Jun. 30, 2024

Schedule of Accounts, Notes, Loans and Financing Receivable

The following table presents the balances for held for investment loans by portfolio segment and held for sale loans.


$ in millions	June 30, 2024			September 30, 2023
SBL	$	15,429		$	14,606
C&I loans	9,956			10,406
CRE loans	7,619			7,221
REIT loans	1,755			1,668
Residential mortgage loans	9,245			8,662
Tax-exempt loans	1,431			1,541
Total loans held for investment	45,435			44,104
Held for sale loans	170			145
Total loans held for sale and investment	45,605			44,249
Allowance for credit losses	(456)			(474)
Bank loans, net (1)	$	45,149		$	43,775

ACL as a % of total loans held for investment	1.00		%	1.07		%
Accrued interest receivable on bank loans (included in “Other receivables, net”)	$	211		$	200

(1)Bank loans, net as of June 30, 2024 and September 30, 2023 are presented net of $8 million and $52 million, respectively, of net unamortized discounts, unearned income, and deferred loan fees and costs, which included $51 million and $84 million, respectively, of net unamortized discounts that arose from the acquisition date fair value purchase discount on bank loans acquired in the TriState Capital Holdings, Inc. (“TriState Capital”) acquisition. See Note 3 of our 2023 Form 10-K for additional information.The following table presents the balances for our loans to financial advisors and the related accrued interest receivable.


$ in millions	June 30, 2024			September 30, 2023
Affiliated with the firm as of period-end (1)	$	1,282		$	1,158
No longer affiliated with the firm as of period-end (2)	14			10
Total loans to financial advisors	1,296			1,168
Allowance for credit losses	(38)			(32)
Loans to financial advisors, net	$	1,258		$	1,136
Accrued interest receivable on loans to financial advisors (included in “Other receivables, net”)	$	8		$	6
Allowance for credit losses as a percent of total loans to financial advisors	2.93		%	2.74		%

(1)These loans were predominantly current.

(2)These loans were predominantly past due for a period of 180 days or more.

Loan Purchases and Sales

The following table presents purchases and sales of loans held for investment by portfolio segment.


$ in millions	C&I loans		CRE loans		REIT loans		Residential mortgage loans		Total
Three months ended June 30, 2024
Purchases	$	218	$	—	$	5	$	112	$	335
Sales	$	159	$	—	$	—	$	—	$	159
Nine months ended June 30, 2024
Purchases	$	738	$	—	$	5	$	234	$	977
Sales	$	322	$	—	$	9	$	—	$	331
Three months ended June 30, 2023
Purchases	$	3	$	—	$	—	$	94	$	97
Sales	$	441	$	—	$	—	$	—	$	441
Nine months ended June 30, 2023
Purchases	$	360	$	39	$	24	$	394	$	817
Sales	$	588	$	—	$	—	$	—	$	588

Analysis of the Payment Status of Loans Held for Investment

The following table presents information on delinquency status of our loans held for investment.


$ 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
June 30, 2024
SBL	$	8	$	2	$	10	$	—	$	—	$	15,419	$	15,429
C&I loans	—		—		—		61		—		9,895		9,956
CRE loans	—		—		—		70		19		7,530		7,619
REIT loans	—		—		—		—		—		1,755		1,755
Residential mortgage loans	6		—		6		—		8		9,231		9,245
Tax-exempt loans	—		—		—		—		—		1,431		1,431
Total loans held for investment	$	14	$	2	$	16	$	131	$	27	$	45,261	$	45,435

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

Loans Pledged as Collateral

The following table presents the amortized cost of our collateral-dependent loans and the nature of the collateral.


$ in millions	Nature of collateral	June 30, 2024		September 30, 2023

C&I loans	Commercial real estate and other business assets	$	9	$	11
CRE loans	Office, multi-family residential, healthcare, medical office, and industrial real estate	$	134	$	47

Residential mortgage loans	Single family homes	$	4	$	5

Credit Quality of Held for Investment Loan Portfolio

The following tables present our held for investment bank loan portfolio by credit quality indicator. Loans classified as special mention, substandard or doubtful are all considered to be “criticized” loans.


	As of and for the nine months ended June 30, 2024
	Loans by origination fiscal year
$ in millions	2024		2023		2022		2021		2020		Prior		Revolving loans		Total
SBL
Risk rating:
Pass	$	67	$	33	$	15	$	77	$	30	$	52	$	15,146	$	15,420
Special mention	—		—		—		—		—		—		—		—
Substandard (1)	9		—		—		—		—		—		—		9
Doubtful	—		—		—		—		—		—		—		—
Total SBL	$	76	$	33	$	15	$	77	$	30	$	52	$	15,146	$	15,429
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



C&I loans
Risk rating:
Pass	$	470	$	586	$	1,084	$	758	$	602	$	3,383	$	2,943	$	9,826
Special mention	—		—		5		—		38		15		1		59
Substandard	—		—		—		—		39		20		12		71
Doubtful	—		—		—		—		—		—		—		—
Total C&I loans	$	470	$	586	$	1,089	$	758	$	679	$	3,418	$	2,956	$	9,956
Gross charge-offs	$	—	$	—	$	—	$	3	$	4	$	30	$	—	$	37



CRE loans
Risk rating:
Pass	$	682	$	1,176	$	2,210	$	977	$	690	$	1,205	$	392	$	7,332
Special mention	—		59		27		—		38		20		—		144
Substandard	—		—		9		5		9		96		16		135
Doubtful	—		—		—		—		—		8		—		8
Total CRE loans	$	682	$	1,235	$	2,246	$	982	$	737	$	1,329	$	408	$	7,619
Gross charge offs	$	—	$	—	$	—	$	—	$	—	$	8	$	—	$	8



REIT loans
Risk rating:
Pass	$	145	$	232	$	182	$	216	$	95	$	250	$	558	$	1,678
Special mention	—		12		—		—		—		13		52		77
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total REIT loans	$	145	$	244	$	182	$	216	$	95	$	263	$	610	$	1,755
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



Residential mortgage loans
Risk rating:
Pass	$	1,028	$	1,678	$	2,784	$	1,525	$	874	$	1,304	$	32	$	9,225
Special mention	—		—		1		—		—		5		—		6
Substandard	—		—		3		—		—		11		—		14
Doubtful	—		—		—		—		—		—		—		—
Total residential mortgage loans	$	1,028	$	1,678	$	2,788	$	1,525	$	874	$	1,320	$	32	$	9,245
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—



Tax-exempt loans
Risk rating:
Pass	$	62	$	57	$	266	$	153	$	54	$	839	$	—	$	1,431
Special mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total tax-exempt loans	$	62	$	57	$	266	$	153	$	54	$	839	$	—	$	1,431
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

(1)As of June 30, 2024, these balances relate to loans which were collateralized by private securities or other financial instruments with a limited trading market.


	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

(1)As of September 30, 2023, these balances relate to loans which were collateralized by private securities or other financial instruments with a limited trading market.

The following table presents the held for investment residential mortgage loan portfolio by LTV ratio at origination and by FICO score.


	June 30, 2024
	Loans by origination fiscal year
$ in millions	2024		2023		2022		2021		2020		Prior		Revolving loans		Total
FICO score:
Below 600	$	1	$	7	$	13	$	5	$	3	$	15	$	—	$	44
600 - 699	43		53		111		52		45		129		3		436
700 - 799	838		1,012		1,599		806		480		652		19		5,406
800 +	145		602		1,065		660		345		520		9		3,346
FICO score not available	1		4		—		2		1		4		1		13
Total	$	1,028	$	1,678	$	2,788	$	1,525	$	874	$	1,320	$	32	$	9,245

LTV ratio:
Below 80%	$	757	$	1,185	$	2,144	$	1,201	$	677	$	1,006	$	31	$	7,001
80%+	271		493		644		324		197		314		1		2,244
Total	$	1,028	$	1,678	$	2,788	$	1,525	$	874	$	1,320	$	32	$	9,245


	September 30, 2023
	Loans by origination fiscal year
$ in millions	2023		2022		2021		2020		2019		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

Changes in the Allowance for Loan Losses

The following table presents changes in the allowance for credit losses on held for investment bank loans by portfolio segment.


$ in millions	SBL			C&I loans			CRE loans			REIT loans			Residential mortgage loans			Tax-exempt loans			Total
Three months ended June 30, 2024
Balance at beginning of period	$	6		$	196		$	181		$	19		$	67		$	2		$	471


Provision/(benefit) for credit losses	(1)			(20)			16			1			(6)			—			(10)

Net (charge-offs)/recoveries:
Charge-offs	—			(6)			(1)			—			—			—			(7)
Recoveries	—			—			—			—			1			—			1
Net (charge-offs)/recoveries	—			(6)			(1)			—			1			—			(6)
Foreign exchange translation adjustment	—			—			1			—			—			—			1
Balance at end of period	$	5		$	170		$	197		$	20		$	62		$	2		$	456

Nine months ended June 30, 2024
Balance at beginning of period	$	7		$	214		$	161		$	16		$	74		$	2		$	474


Provision/(benefit) for credit losses	(2)			(9)			43			4			(13)			—			23

Net (charge-offs)/recoveries:
Charge-offs	—			(37)			(8)			—			—			—			(45)
Recoveries	—			2			—			—			1			—			3
Net (charge-offs)/recoveries	—			(35)			(8)			—			1			—			(42)
Foreign exchange translation adjustment	—			—			1			—			—			—			1
Balance at end of period	$	5		$	170		$	197		$	20		$	62		$	2		$	456

ACL by loan portfolio segment as a % of total ACL	1.1		%	37.3		%	43.2		%	4.4		%	13.6		%	0.4		%	100.0		%

Three months ended June 30, 2023
Balance at beginning of period	$	5		$	219		$	100		$	15		$	74		$	2		$	415



Provision/(benefit) for credit losses	—			(8)			55			1			6			—			54

Net (charge-offs)/recoveries:
Charge-offs	—			(6)			(9)			—			—			—			(15)
Recoveries	—			—			—			—			—			—			—
Net (charge-offs)/recoveries	—			(6)			(9)			—			—			—			(15)
Foreign exchange translation adjustment	—			1			1			—			—			—			2
Balance at end of period	$	5		$	206		$	147		$	16		$	80		$	2		$	456

Nine months ended June 30, 2023
Balance at beginning of period	$	3		$	226		$	87		$	21		$	57		$	2		$	396



Provision/(benefit) for credit losses	2			10			66			(5)			23			—			96

Net (charge-offs)/recoveries:
Charge-offs	—			(30)			(10)			—			—			—			(40)
Recoveries	—			—			3			—			—			—			3
Net (charge-offs)/recoveries	—			(30)			(7)			—			—			—			(37)
Foreign exchange translation adjustment	—			—			1			—			—			—			1
Balance at end of period	$	5		$	206		$	147		$	16		$	80		$	2		$	456

ACL by loan portfolio segment as a % of total ACL	1.1		%	45.3		%	32.2		%	3.5		%	17.5		%	0.4		%	100.0		%