Equity Securities

9 Months Ended

Sep. 30, 2024

Equity Securities [Abstract]

Equity Securities

Note 4:  Equity Securities

Table 4.1 provides a summary of our equity securities by business purpose and accounting method.

Table 4.1: Equity Securities

(in millions)	Sep 30, 2024		Dec 31, 2023
Equity securities held for trading at fair value (1)	$	20,351	18,449
Not held for trading:
Equity securities at fair value	2,010		1,392
Tax credit investments (2)	21,241		20,016
Private equity (3)	12,253		12,203
Federal Reserve Bank stock and other at cost (4)	3,916		5,276
Total equity securities not held for trading	39,420		38,887
Total equity securities	$	59,771	57,336

(1)Represents securities held as part of our customer accommodation trading activities. For additional information on these activities, see Note 2 (Trading Activities).

(2)Includes affordable housing investments of $12.4 billion and $12.9 billion at September 30, 2024, and December 31, 2023, respectively, and renewable energy investments of $8.5 billion and $6.8 billion at September 30, 2024, and December 31, 2023, respectively. Tax credit investments are accounted for using either the proportional amortization method or the equity method. See Note 13 (Securitizations and Variable Interest Entities) for information about tax credit investments.

(3)Includes equity securities accounted for under the measurement alternative of $9.1 billion at both September 30, 2024, and December 31, 2023, which were predominantly securities associated with our venture capital investments. The remaining securities are accounted for using the equity method.

(4)Includes $3.5 billion of investments in Federal Reserve Bank stock at both September 30, 2024, and December 31, 2023, and $358 million and $1.7 billion of investments in Federal Home Loan Bank stock at September 30, 2024, and December 31, 2023, respectively.

Net Gains and Losses Not Held for Trading

Table 4.2 provides a summary of the net gains and losses from equity securities not held for trading, which excludes equity method adjustments for our share of the investee’s earnings or

losses that are recognized in other noninterest income. Gains and losses for securities held for trading are reported in net gains from trading and securities.

Table 4.2: Net Gains (Losses) from Equity Securities Not Held for Trading

	Quarter ended September 30,			Nine months ended September 30,
(in millions)	2024		2023	2024		2023
Net gains from equity securities carried at fair value	10		16	70		26
Net gains (losses) from equity securities not carried at fair value (1):
Impairment write-downs	(178)		(211)	(568)		(876)
Net unrealized gains (losses) (2)	(39)		46	290		185
Net realized gains	464		124	563		189
Total equity securities not carried at fair value	247		(41)	285		(502)
Total net gains (losses) from equity securities not held for trading	$	257	(25)	$	355	(476)

(1)Includes amounts related to venture capital and private equity investments in consolidated portfolio companies, which are not reported in equity securities on our consolidated balance sheet.

(2)Includes unrealized gains (losses) due to observable price changes from equity securities accounted for under the measurement alternative.

Measurement Alternative

Table 4.3 provides additional information about the impairment write-downs and observable price changes from nonmarketable

equity securities accounted for under the measurement alternative. Gains and losses related to these adjustments are also included in Table 4.2.

Table 4.3: Net Gains (Losses) from Measurement Alternative Equity Securities

	Quarter ended September 30,				Nine months ended September 30,
(in millions)	2024		2023		2024		2023
Net gains (losses) recognized in earnings during the period:
Gross unrealized gains from observable price changes	$	12	46		$	350	214
Gross unrealized losses from observable price changes	—		—		(9)		(29)
Impairment write-downs	(104)		(209)		(424)		(863)
Net realized gains from sale	31		—		96		36
Total net gains (losses) recognized during the period	$	(61)	$	(163)	$	13	(642)

Table 4.4 presents cumulative carrying value adjustments to nonmarketable equity securities accounted for under the measurement alternative that were still held at the end of each reporting period presented.

Table 4.4: Measurement Alternative Cumulative Gains (Losses)

(in millions)	Sep 30, 2024		Dec 31, 2023
Cumulative gains (losses):
Gross unrealized gains from observable price changes	$	7,494	7,614
Gross unrealized losses from observable price changes	(53)		(44)
Impairment write-downs	(3,772)		(3,772)