EMPLOYEE BENEFITS

12 Months Ended

Dec. 31, 2024

Retirement Benefits [Abstract]

EMPLOYEE BENEFITS

NOTE 15 - EMPLOYEE BENEFIT PLANS

Pension and Other Postretirement Plans

The Company maintains a non-contributory pension plan (the “Citizens Qualified Plan”) that was closed to new hires and re-hires effective January 1, 2009, and frozen to all participants effective December 31, 2012. Benefits under the Citizens Qualified Plan are based on employees’ years of service and highest 5-year average of eligible compensation. The Citizens Qualified Plan is funded on a current basis, in compliance with the requirements of the Employee Retirement Income Security Act of 1974.

In connection with the Investors acquisition, effective June 30, 2022, the Company withdrew from a multi-employer plan and transferred the plan assets into a newly established defined benefit pension plan sponsored by the Company (the “Investors Qualified Plan”). The Investors Qualified Plan was closed to new hires and re-hires effective December 1, 2015, and future benefit accruals were frozen to all participants effective December 31, 2016.

The Citizens Qualified Plan and the Investors Qualified Plan are collectively referred to as the Company’s “Qualified Plans.”

The Company also provides an unfunded, non-qualified supplemental retirement plan which was closed and frozen effective December 31, 2012, as well as postretirement benefit plans. As part of the Investors acquisition in 2022, the Company also obtained other frozen, non-qualified supplemental retirement and postretirement benefit plans. These plans are collectively referred to as the Company’s “Non-Qualified Plans.”

The Company’s Qualified Plans and Non-Qualified Plans are collectively referred to as the Company’s “Pension Plans.” The Pension Plans’ investments include equity-oriented and fixed income-oriented investments including, but not limited to, government obligations, corporate bonds, and common and collective equity and fixed income funds.

The following table presents changes in the fair value of the Company’s Pension Plan assets, projected benefit obligation, funded status, and accumulated benefit obligation:

	Year Ended December 31,
	Qualified Plans		Non-Qualified Plans
(dollars in millions)	2024	2023	2024	2023
Fair value of plan assets as of January 1	$1,281	$1,182	$—	$—
Return on plan assets	86	169	—	—
Employer contributions	—	—	20	5
Settlements	—	—	(11)	—
Benefits and administrative expenses paid	(67)	(70)	(9)	(5)
Fair value of plan assets as of December 31	1,300	1,281	—	—
Projected benefit obligation	828	880	84	99
Pension asset (obligation)	$472	$401	($84)	($99)
Accumulated benefit obligation	$828	$880	$84	$99

Actuarial losses related to the Pension Plans recognized in AOCI at December 31, 2024 and 2023 were $403 million and $446 million, respectively.

In 2025, the Company does not plan to contribute to the Qualified Plans and expects to contribute $10 million to the Non-Qualified Plans.

The following table presents the components of net periodic benefit cost (income) and other changes in plan assets and benefit obligations recognized in OCI for the Company’s Pension Plans:

	Year Ended December 31,
	Qualified Plans			Non-Qualified Plans			Total
(dollars in millions)	2024	2023	2022	2024	2023	2022	2024	2023	2022
Service cost	$3	$4	$3	$—	$—	$—	$3	$4	$3
Interest cost	45	46	34	5	5	3	50	51	37
Expected return on plan assets	(97)	(92)	(93)	—	—	—	(97)	(92)	(93)
Amortization of actuarial loss	13	15	11	1	2	3	14	17	14
Settlement	—	—	—	3	—	—	3	—	—
Net periodic benefit cost (income)(1)	(36)	(27)	(45)	9	7	6	(27)	(20)	(39)
Net actuarial loss (gain)	(23)	(44)	71	(3)	1	(19)	(26)	(43)	52
Amortization of actuarial loss	(13)	(15)	(11)	(1)	(2)	(3)	(14)	(17)	(14)
Settlement	—	—	—	(3)	—	—	(3)	—	—
Total recognized in OCI	(36)	(59)	60	(7)	(1)	(22)	(43)	(60)	38
Total recognized in net periodic benefit cost (income) and OCI	($72)	($86)	$15	$2	$6	($16)	($70)	($80)	($1)

(1) In the Consolidated Statements of Operations, service cost is presented in salaries and employee benefits and all other components of net periodic benefit cost (income) are presented in other operating expense.

Costs under the Company’s Pension Plans are actuarially computed and include current service costs and amortization of prior service costs over the participants’ average future working lifetime. The actuarial cost method used in determining the net periodic benefit cost is the projected unit method. During 2024, lump sum payments made under a Citizens Non-Qualified Plan triggered settlement accounting. In accordance with the applicable accounting guidance for defined benefit plans, the Company performed a remeasurement of the plan and recognized a settlement loss.

The following table presents the expected future benefit payments for the Company’s Pension Plans:

	(dollars in millions)
Expected benefit payments by fiscal year ending:
December 31, 2025	$72
December 31, 2026	73
December 31, 2027	74
December 31, 2028	73
December 31, 2029	73
December 31, 2030 - 2034	352

401(k) Plan

The Company sponsors a 401(k) Plan under which employee contributions are matched by the Company dollar for dollar up to 4% after the employee completes of one year of service. In addition, substantially all employees will receive an additional 1.5% of their eligible earnings after completion of one year of service, subject to limits set by the Internal Revenue Service. Amounts expensed by the Company were $84 million in 2024 compared to $78 million in 2023 and $86 million in 2022.