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LOANS AND LEASES
 9 Months Ended
Sep. 30, 2023
Receivables [Abstract]  
LOANS AND LEASES
NOTE 3 - LOANS AND LEASES
Loans held for investment are reported at the amount of their outstanding principal, net of charge-offs, unearned income, deferred loan origination fees and costs, and unamortized premiums or discounts on purchased loans.
The following table presents loans and leases, excluding LHFS:
(dollars in millions)September 30, 2023December 31, 2022
Commercial and industrial$46,753 $51,836 
Commercial real estate29,486 28,865 
Leases1,218 1,479 
Total commercial77,457 82,180 
Residential mortgages30,983 29,921 
Home equity14,729 14,043 
Automobile9,290 12,292 
Education12,134 12,808 
Other retail5,153 5,418 
Total retail72,289 74,482 
Total loans and leases$149,746 $156,662 
Accrued interest receivable on loans and leases held for investment totaled $887 million and $820 million as of September 30, 2023 and December 31, 2022, respectively, and is included in other assets in the Consolidated Balance Sheets.
Loans pledged as collateral for FHLB borrowing capacity, primarily residential mortgages and home equity products, totaled $37.1 billion and $38.4 billion at September 30, 2023 and December 31, 2022, respectively. Loans pledged as collateral to support the contingent ability to borrow at the FRB discount window, if necessary, were primarily comprised of education, automobile, commercial and industrial, and commercial real estate loans, and totaled $31.1 billion and $34.8 billion at September 30, 2023 and December 31, 2022, respectively.
In addition to loans pledged as collateral to secure borrowing capacity, the Company has secured borrowing arrangements collateralized by auto loans. See Note 7 for additional information.
Interest income on direct financing and sales-type leases for the three months ended September 30, 2023 and 2022 was $12 million and $13 million, respectively, and is reported within interest and fees on loans and leases in the Consolidated Statements of Operations. For the nine months ended September 30, 2023 and 2022, this interest income was $36 million and $34 million, respectively.
The following table presents the composition of LHFS:
September 30, 2023December 31, 2022
(dollars in millions)
Residential Mortgages(1)
Commercial(2)
Total
Residential Mortgages(1)
Commercial(2)
Total
Loans held for sale at fair value$739 $10 $749 $666 $108 $774 
Other loans held for sale— 99 99 — 208 208 
(1) Residential mortgage LHFS are originated for sale.
(2) Commercial LHFS at fair value consist of loans managed by the Company’s commercial secondary loan desk. Other commercial LHFS primarily consist of loans associated with the Company’s syndication business.