MORTGAGE BANKING AND OTHER (Tables)

6 Months Ended

Jun. 30, 2021

Mortgage Banking [Abstract]

Schedule of mortgage banking activities

The following table summarizes activity related to residential mortgage loans sold with servicing rights retained:

	Three Months Ended June 30,		Six Months Ended June 30,
(in millions)	2021	2020	2021	2020
Cash proceeds from residential mortgage loans sold with servicing retained	$10,540	$8,797	$19,577	$14,164
Gain on sales (1)	85	283	225	426
Contractually specified servicing, late and other ancillary fees (1)	60	55	118	113

(1) Reported in mortgage banking fees in the Consolidated Statements of Operations.

Servicing asset at fair value

The following table summarizes changes in MSRs recorded using the fair value method:

	As of and for the Three Months Ended June 30,		As of and for the Six Months Ended June 30,
(in millions)	2021	2020	2021	2020
Fair value as of beginning of the period	$893	$577	$658	$642
Transfers upon election of fair value method (1)	—	—	—	190
Fair value as of beginning of the period, adjusted	893	577	658	832
Amounts capitalized	122	86	209	153
Changes in unpaid principal balance during the period (2)	(47)	(46)	(105)	(86)
Changes in fair value during the period (3)	(66)	(49)	140	(331)
Fair value at end of the period	$902	$568	$902	$568

(1) Effective January 1, 2020, the Company elected to account for all MSRs previously accounted for under the amortization method under the fair value method.

(2) Represents changes in value of the MSRs due to i) passage of time including the impact from both regularly scheduled loan principal payments and partial

paydowns, and ii) loans that paid off during the period.

(3) Represents changes in value primarily driven by market conditions. These changes are recorded in mortgage banking fees in the Consolidated Statements of Operations.

Schedule of fair value assumptions used to estimate the value of Mortgage Servicing Rights

	June 30, 2021			December 31, 2020
	Actual	Decline in fair value due to		Actual	Decline in fair value due to
(dollars in millions)
Fair value	$902	50 bps adverse change	100 bps adverse change	$658	50 bps adverse change	100 bps adverse change
Weighted average life (in years)	5.7			4.2
Weighted average constant prepayment rate (1)	11.9%	$129	$273	17.3%	$122	$202
Weighted average option adjusted spread	581 bps	18	36	595 bps	12	24

(1) Estimated adverse change for the weighted average constant prepayment rate based on an adverse change in market interest rates.

Schedule of other serviced loans

The following table presents the unpaid principal balance of other serviced loans:

(in millions)	June 30, 2021	December 31, 2020
Education	$867	$974
Commercial (1)	61	51

(1) Represents the government guaranteed portion of SBA loans sold to outside investors.