Investment Securities (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of Amortized Cost and Fair Value of Investment Securities

The following tables as of September 30, 2022 include the investment security balances acquired in the CIT Merger, which were recorded at fair value on the acquisition date. The amortized cost and fair value of investment securities at September 30, 2022 and December 31, 2021, were as follows:

Amortized Cost and Fair Value - Debt Securities


dollars in millions	September 30, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Investment securities available for sale
U.S. Treasury	$	2,047	$	—	$	(147)	$	1,900
Government agency	175		—		(2)		173
Residential mortgage-backed securities	5,450		—		(666)		4,784
Commercial mortgage-backed securities	1,828		—		(155)		1,673
Corporate bonds	583		—		(25)		558

Total investment securities available for sale	$	10,083	$	—	$	(995)	$	9,088
Investment in marketable equity securities	$	73	$	20	$	(1)	$	92
Investment securities held to maturity
U.S. Treasury	$	473	$	—	$	(54)	$	419
Government agency	1,546		—		(196)		1,350
Residential mortgage-backed securities	4,510		—		(765)		3,745
Commercial mortgage-backed securities	2,834		—		(437)		2,397
Supranational securities	295		—		(43)		252
Other	3		—		—		3
Total investment securities held to maturity	$	9,661	$	—	$	(1,495)	$	8,166
Total investment securities	$	19,817	$	20	$	(2,491)	$	17,346

	December 31, 2021
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Investment securities available for sale
U.S. Treasury	$	2,007	$	—	$	(2)	$	2,005
Government agency	221		1		(1)		221
Residential mortgage-backed securities	4,757		8		(36)		4,729
Commercial mortgage-backed securities	1,648		9		(17)		1,640
Corporate bonds	582		27		(1)		608

Total investment securities available for sale	$	9,215	$	45	$	(57)	$	9,203
Investment in marketable equity securities	$	73	$	25	$	—	$	98
Investment securities held to maturity
Residential mortgage-backed securities	$	2,322	$	6	$	(22)	$	2,306
Commercial mortgage-backed securities	1,485		—		(34)		1,451
Other	2		—		—		2
Total investment securities held to maturity	$	3,809	$	6	$	(56)	$	3,759
Total investment securities	$	13,097	$	76	$	(113)	$	13,060

Schedule of Investment Securities Maturity Information

The following table provides the amortized cost and fair value by contractual maturity. Expected maturities will differ from contractual maturities on certain securities because borrowers and issuers may have the right to call or prepay obligations with or without prepayment penalties. Residential and commercial mortgage-backed and government agency securities are stated separately as they are not due at a single maturity date.

Maturities - Debt Securities


dollars in millions	September 30, 2022				December 31, 2021
	Cost		Fair Value		Cost		Fair Value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less	$	48	$	48	$	—	$	—
After one through five years	2,063		1,914		2,049		2,048
After five through 10 years	503		481		523		548
After 10 years	16		15		17		17

Government agency	175		173		221		221
Residential mortgage-backed securities	5,450		4,784		4,757		4,729
Commercial mortgage-backed securities	1,828		1,673		1,648		1,640
Total investment securities available for sale	$	10,083	$	9,088	$	9,215	$	9,203
Investment securities held to maturity
Non-amortizing securities maturing in:
One year or less	$	53	$	51	$	2	$	2
After one through five years	1,334		1,190		—		—
After five through 10 years	930		783		—		—


Residential mortgage-backed securities	4,510		3,745		2,322		2,306
Commercial mortgage-backed securities	2,834		2,397		1,485		1,451


Total investment securities held to maturity	$	9,661	$	8,166	$	3,809	$	3,759

Schedule of Interest and Dividends on Investment Securities

The following table presents interest and dividend income on investment securities.

Interest and Dividends on Investment Securities


dollars in millions	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Interest income - taxable investment securities	$	89	$	39	$	260	$	104



Dividend income - marketable equity securities	1		1		2		2
Interest on investment securities	$	90	$	40	$	262	$	106

Schedule of Realized Gain (Loss)

The following table provides the gross realized gains and losses on the sales of investment securities available for sale:

Realized Gains on Debt Securities Available For Sale


dollars in millions	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Gross realized gains on sales of investment securities available for sale	$	—	$	8	$	—	$	33
Gross realized losses on sales of investment securities available for sale	—		—		—		—
Net realized gains on sales of investment securities available for sale	$	—	$	8	$	—	$	33

The following table provides the fair value adjustment on marketable equity securities:

Fair Value Adjustment on Marketable Equity Securities


dollars in millions	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021


Fair value adjustment on marketable equity securities, net	$	(2)	$	3	$	(5)	$	31

Schedule of Unrealized Loss on Available-for-sale Securities

The following table provides information regarding investment securities available for sale with unrealized losses for which an ACL has not been recorded:

Gross Unrealized Losses on Debt Securities Available For Sale


dollars in millions	September 30, 2022
	Less than 12 months				12 months or more				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Investment securities available for sale
U.S. Treasury	$	1,900	$	(147)	$	—	$	—	$	1,900	$	(147)
Government agency	70		(1)		65		(1)		135		(2)
Residential mortgage-backed securities	2,178		(231)		2,573		(435)		4,751		(666)
Commercial mortgage-backed securities	938		(64)		688		(91)		1,626		(155)
Corporate bonds	493		(23)		44		(2)		537		(25)
Total	$	5,579	$	(466)	$	3,370	$	(529)	$	8,949	$	(995)

	December 31, 2021
	Less than 12 months				12 months or more				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Investment securities available for sale
U.S. Treasury	$	1,811	$	(2)	$	—	$	—	$	1,811	$	(2)
Government agency	17		—		79		(1)		96		(1)
Residential mortgage-backed securities	3,992		(36)		1		—		3,993		(36)
Commercial mortgage-backed securities	852		(15)		111		(2)		963		(17)
Corporate bonds	52		(1)		—		—		52		(1)
Total	$	6,724	$	(54)	$	191	$	(3)	$	6,915	$	(57)