SECURITIES (Tables)

9 Months Ended

Sep. 30, 2023

Investments, Debt and Equity Securities [Abstract]

The following table presents the major components of securities at amortized cost and fair value:


	September 30, 2023				December 31, 2022
(dollars in millions)	Amortized Cost(1)	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
U.S. Treasury and other	$4,025	$—	($251)	$3,774	$3,678	$1	($193)	$3,486
State and political subdivisions	2	—	—	2	2	—	—	2
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	23,101	1	(2,845)	20,257	21,250	10	(2,198)	19,062
Other/non-agency	279	—	(32)	247	280	—	(29)	251
Total mortgage-backed securities	23,380	1	(2,877)	20,504	21,530	10	(2,227)	19,313
Collateralized loan obligations	797	—	(8)	789	1,248	—	(42)	1,206
Total debt securities available for sale, at fair value	$28,204	$1	($3,136)	$25,069	$26,458	$11	($2,462)	$24,007
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	$8,810	$—	($1,241)	$7,569	$9,253	$4	($751)	$8,506
Total mortgage-backed securities	8,810	—	(1,241)	7,569	9,253	4	(751)	8,506
Asset-backed securities	510	1	(26)	485	581	—	(45)	536
Total debt securities held to maturity	$9,320	$1	($1,267)	$8,054	$9,834	$4	($796)	$9,042
Equity securities, at cost(2)	$995	$—	$—	$995	$1,058	$—	$—	$1,058
Equity securities, at fair value(2)	163	—	—	163	153	—	—	153

(1) Excludes portfolio level basis adjustments of $17 million for securities designated in active fair value hedge relationships. The basis adjustments represent a reduction to the amortized cost of the securities being hedged.

(2) Included in other assets in the Consolidated Balance Sheets.

Schedule of investments classified by maturity date

The following table presents the amortized cost and fair value of debt securities by contractual maturity as of September 30, 2023. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without incurring penalties.


	Distribution of Maturities
(dollars in millions)	1 Year or Less	After 1 Year through 5 Years	After 5 Years through 10 Years	After 10 Years	Total
Amortized cost:
U.S. Treasury and other	$—	$2,688	$1,337	$—	$4,025
State and political subdivisions		—	—	2	2
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	1,406	2,431	19,264	23,101
Other/non-agency	—	—	—	279	279
Collateralized loan obligations	—	—	25	772	797
Total debt securities available for sale	—	4,094	3,793	20,317	28,204
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	—	—	8,810	8,810
Asset-backed securities	—	510	—	—	510
Total debt securities held to maturity	—	510	—	8,810	9,320
Total amortized cost of debt securities	$—	$4,604	$3,793	$29,127	$37,524

Fair value:
U.S. Treasury and other	$—	$2,513	$1,261	$—	$3,774
State and political subdivisions	—	—	—	2	2
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	1,313	2,225	16,719	20,257
Other/non-agency	—	—	—	247	247
Collateralized loan obligations	—	—	25	764	789
Total debt securities available for sale	—	3,826	3,511	17,732	25,069
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	—	—	7,569	7,569
Asset-backed securities	—	485	—	—	485
Total debt securities held to maturity	—	485	—	7,569	8,054
Total fair value of debt securities	$—	$4,311	$3,511	$25,301	$33,123

Schedule of income recognized on investment securities

The following table presents realized gains and losses on sale of securities:


	Three Months Ended September 30,		Nine Months Ended September 30,
(dollars in millions)	2023	2022	2023	2022
Gains	$9	$—	$27	$9
Losses	(4)	—	(8)	(4)
Securities gains, net	$5	$—	$19	$5

Schedule of financial instruments owned and pledged as collateral

The following table presents the amortized cost and fair value of debt securities pledged:


	September 30, 2023		December 31, 2022
(dollars in millions)	Amortized Cost	Fair Value	Amortized Cost	Fair Value
Pledged against derivatives, to qualify for fiduciary powers, or to secure public and other deposits as required by law	$5,739	$4,945	$3,966	$3,527
Pledged as collateral for FHLB borrowing capacity	243	213	244	217
Pledged against repurchase agreements	250	248	—	—

Schedule of unrealized loss on investments

The following tables present AFS debt securities with fair values below their respective carrying values, separated by the duration the securities have been in a continuous unrealized loss position:


	September 30, 2023
	Less than 12 Months		12 Months or Longer		Total
(dollars in millions)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury and other	$583	($12)	$3,142	($239)	$3,725	($251)

Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	3,796	(111)	15,897	(2,734)	19,693	(2,845)
Other/non-agency	—	—	247	(32)	247	(32)
Total mortgage-backed securities	3,796	(111)	16,144	(2,766)	19,940	(2,877)
Collateralized loan obligations	32	—	757	(8)	789	(8)
Total	$4,411	($123)	$20,043	($3,013)	$24,454	($3,136)


	December 31, 2022
	Less than 12 Months		12 Months or Longer		Total
(dollars in millions)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury and other	$3,356	($193)	$—	$—	$3,356	($193)
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	13,353	(1,136)	5,042	(1,062)	18,395	(2,198)
Other/non-agency	80	(8)	171	(21)	251	(29)
Total mortgage-backed securities	13,433	(1,144)	5,213	(1,083)	18,646	(2,227)
Collateralized loan obligations	785	(26)	421	(16)	1,206	(42)
Total	$17,574	($1,363)	$5,634	($1,099)	$23,208	($2,462)