Business Segment Information

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Business Segment Information

BUSINESS SEGMENT INFORMATION

BancShares began reporting multiple segments during the first quarter of 2022 and now reports General Banking, Commercial Banking, Rail, and Corporate segments, as further discussed in Note 1 — Significant Accounting Policies and Basis of Presentation. Each of the segments are described below.

General Banking

General Banking delivers products and services to consumers and businesses through an extensive network of branches and various digital channels, including a full suite of deposit products, loans (primarily residential mortgages and business/commercial loans), and various fee-based services. General Banking also provides a variety of wealth management products and services to individuals and institutional clients, including brokerage, investment advisory, and trust services. In addition, General Banking has a dedicated business line that supports deposit, cash management and lending to homeowner associations and property management companies nationwide. Revenue is primarily generated from interest earned on loans and fees for banking and advisory services. General Banking segment is the primary deposit gathering business of FCB.

Commercial Banking

Commercial Banking provides a range of lending, leasing, capital markets, asset management and other financial and advisory services primarily to small and middle market companies in a wide range of industries. Loans offered are primarily senior secured loans collateralized by accounts receivable, inventory, machinery and equipment, transportation equipment and/or intangibles, and are often used for working capital, plant expansion, acquisitions or recapitalizations. These loans include revolving lines of credit and term loans and, depending on the nature of the collateral, may be referred to as collateral-backed loans, asset-based loans or cash flow loans. Commercial Banking provides senior secured loans to developers and other commercial real estate professionals, and also provides small business loans and leases, including both capital and operating leases, through a highly automated credit approval, documentation and funding process. Commercial Banking provides factoring, receivable management, and secured financing to businesses that operate in various industries.

Revenue is primarily generated from interest earned on loans, rents on equipment leased, fees and other revenue from lending and leasing activities and banking services, along with capital markets transactions and commissions earned on factoring and related activities.

Rail

Rail offers customized leasing and financing solutions on a fleet of railcars and locomotives to railroads and shippers throughout North America. Railcar types include covered hopper cars used to ship grain and agricultural products, plastic pellets, sand, and cement; tank cars for energy products and chemicals; gondolas for coal, steel coil and mill service products; open hopper cars for coal and aggregates; boxcars for paper and auto parts, and center beams and flat cars for lumber. Revenue is primarily from operating lease income.

Corporate

Certain items that are not allocated to operating segments are included in the Corporate segment. Some of the more significant and recurring items include interest income on investment securities, a portion of interest expense primarily related to corporate funding costs (including brokered deposits), income on BOLI (other noninterest income), merger-related costs, as well as certain unallocated costs and intangible asset amortization expense (operating expenses). Corporate also includes certain significant items that are infrequent, such as: the Initial Non-PCD Provision for loans and leases and unfunded commitments; and the gain on acquisition, each of which are related to the CIT Merger.

Segment Net Income (Loss) and Select Period End Balances

The following table presents the condensed income statements and select period end balances for each segment.

dollars in millions	Year Ended December 31, 2022
	General Banking		Commercial Banking		Rail		Corporate		Total BancShares
Net interest income (expense)	$	1,942	$	889	$	(80)	$	195	$	2,946
Provision for credit losses	11		121		—		513		645
Net interest income (expense) after provision for credit losses	1,931		768		(80)		(318)		2,301
Noninterest income	472		521		657		486		2,136
Noninterest expense	1,570		746		428		331		3,075
Income (loss) before income taxes	833		543		149		(163)		1,362
Income tax expense (benefit)	204		128		37		(105)		264
Net income (loss)	$	629	$	415	$	112	$	(58)	$	1,098
Select Period End Balances
Loans and leases	$	42,930	$	27,773	$	78	$	—	$	70,781
Deposits	84,361		3,225		15		1,807		89,408
Operating lease equipment, net	—		723		7,433		—		8,156
	Year Ended December 31, 2021
	General Banking		Commercial Banking		Rail		Corporate		Total BancShares
Net interest income (expense)	$	1,447	$	17	$	—	$	(74)	$	1,390
Benefit for credit losses	(37)		—		—		—		(37)
Net interest income (expense) after benefit for credit losses	1,484		17		—		(74)		1,427
Noninterest income	433		—		—		75		508
Noninterest expense	1,179		3		—		52		1,234
Income (loss) before income taxes	738		14		—		(51)		701
Income tax expense (benefit)	162		3		—		(11)		154
Net income (loss)	$	576	$	11	$	—	$	(40)	$	547
Select Period End Balances
Loans and leases	$	31,820	$	552	$	—	$	—	$	32,372
Deposits	51,344		62		—		—		51,406
	Year Ended December 31, 2020
	General Banking		Commercial Banking		Rail		Corporate		Total BancShares
Net interest income (expense)	$	1,391	$	15	$	—	$	(18)	$	1,388
Provision for credit losses	58		—		—		—		58
Net interest income (expense) after provision for credit losses	1,333		15		—		(18)		1,330
Noninterest income	379		—		—		98		477
Noninterest expense	1,146		3		—		40		1,189
Income before income taxes	566		12		—		40		618
Income tax expense	116		2		—		8		126
Net income	$	450	$	10	$	—	$	32	$	492
Select Period End Balances
Loans and leases	$	32,235	$	554	$	—	$	3	$	32,792
Deposits	43,391		40		—		1		43,432