XML 22 R11.htm IDEA: XBRL DOCUMENT v3.25.1
INVESTMENT SECURITIES
 3 Months Ended
Mar. 31, 2025
Investments [Abstract]  
INVESTMENT SECURITIES
NOTE 3 — INVESTMENT SECURITIES

The following tables include the amortized cost and fair value of investment securities:

Amortized Cost and Fair Value - Investment Securities
dollars in millions March 31, 2025
Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
Investment securities available for sale
U.S. Treasury$13,105 $55 $(10)$13,150 
Government agency71 — (2)69 
Residential mortgage-backed securities16,905 143 (443)16,605 
Commercial mortgage-backed securities3,759 21 (186)3,594 
Corporate bonds483 1 (19)465 
Municipal bonds17 — — 17 
Total investment securities available for sale$34,340 $220 $(660)$33,900 
Investment in marketable equity securities$78 $21 $(4)$95 
Investment securities held to maturity
U.S. Treasury$484 $— $(25)$459 
Government agency1,491 — (91)1,400 
Residential mortgage-backed securities4,668 17 (595)4,090 
Commercial mortgage-backed securities3,378 — (630)2,748 
Supranational securities301 — (27)274 
Other2 — — 2 
Total investment securities held to maturity$10,324 $17 $(1,368)$8,973 
Total investment securities$44,742 $258 $(2,032)$42,968 
December 31, 2024
Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
Investment securities available for sale
U.S. Treasury$13,897 $33 $(27)$13,903 
Government agency79 — (2)77 
Residential mortgage-backed securities16,161 41 (582)15,620 
Commercial mortgage-backed securities3,869 7 (210)3,666 
Corporate bonds489 — (22)467 
Municipal bonds17 — — 17 
Total investment securities available for sale$34,512 $81 $(843)$33,750 
Investment in marketable equity securities$79 $27 $(5)$101 
Investment securities held to maturity
U.S. Treasury$483 $— $(31)$452 
Government agency1,489 — (115)1,374 
Residential mortgage-backed securities4,558 2 (682)3,878 
Commercial mortgage-backed securities3,407 — (678)2,729 
Supranational securities300 — (33)267 
Other2 — — 2 
Total investment securities held to maturity$10,239 $2 $(1,539)$8,702 
Total investment securities$44,830 $110 $(2,387)$42,553 

U.S. Treasury investments include Treasury bills and Notes issued by the U.S. Treasury. Investments in government agency securities represent securities issued by the Small Business Administration (“SBA”), Federal Home Loan Bank (“FHLB”) and other U.S. agencies. Investments in residential and commercial mortgage-backed securities represent securities issued by the Government National Mortgage Association, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation. Investments in corporate bonds represent positions in debt securities of other financial institutions. Municipal bonds are revenue bonds. Investments in marketable equity securities represent positions in common stock of publicly traded financial institutions. Investments in supranational securities represent securities issued by the Supranational Entities & Multilateral Development Banks. Other held to maturity investments include certificates of deposit with other financial institutions.
BancShares initially held approximately 354,000 shares of Visa, Inc. (“Visa”) Class B common stock (“Visa Class B common stock”). Effective January 24, 2024, all outstanding shares of Visa Class B common stock were redenominated as Visa Class B-1 common stock (“Visa Class B-1 common stock”) pursuant to Visa’s eighth amended and restated certificate of incorporation. BancShares currently holds approximately 354,000 shares of Visa Class B-1 common stock. Until the resolution of certain litigation, at which time the Visa Class B-1 common stock will convert to publicly traded Visa Class A common stock, or the potential exchange of Visa Class B-1 common stock for other marketable classes of Visa common stock, these shares are only transferable to other stockholders of Visa Class B-1 common stock or certain new denominations of Visa’s former Class B common stock. As a result, there is limited transfer activity in private transactions between buyers and sellers. Given this limited trading activity and the continuing uncertainty regarding the likelihood, ultimate timing and eventual exchange of Visa Class B-1 common stock for shares of Visa Class A common stock or other marketable classes of Visa common stock, these shares are not considered to have a readily determinable fair value and have no carrying value. BancShares continues to monitor the trading activity in Visa Class B-1 common stock, the status of the resolution of certain litigation matters at Visa, and other potential exchange alternatives that would trigger the conversion of the Visa Class B-1 common stock into Visa Class A common stock or other marketable classes of Visa common stock.

Accrued interest receivable for available for sale and held to maturity debt securities was excluded from the estimate for credit losses. At March 31, 2025, accrued interest receivable for available for sale and held to maturity debt securities was $178 million and $19 million, respectively. At December 31, 2024, accrued interest receivable for available for sale and held to maturity debt securities was $177 million and $20 million, respectively. During the three months ended March 31, 2025 and 2024, there was no accrued interest that was deemed uncollectible and written off against interest income.

A security is considered past due once it is 30 days contractually past due under the terms of the agreement. There were no securities past due as of March 31, 2025 or December 31, 2024.

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 millionsMarch 31, 2025December 31, 2024
Amortized CostFair ValueAmortized CostFair Value
Investment securities available for sale
Non-amortizing securities maturing in:
One year or less$5,503 $5,508 $5,090 $5,086 
After one through five years7,727 7,764 8,945 8,949 
After five through 10 years353 338 346 330 
After 10 years22 22 22 22 
Government agency71 69 79 77 
Residential mortgage-backed securities16,905 16,605 16,161 15,620 
Commercial mortgage-backed securities3,759 3,594 3,869 3,666 
Total investment securities available for sale$34,340 $33,900 $34,512 $33,750 
Investment securities held to maturity
Non-amortizing securities maturing in:
One year or less$450 $443 $429 $419 
After one through five years1,281 1,209 1,299 1,208 
After five through 10 years547 483 546 468 
Residential mortgage-backed securities4,668 4,090 4,558 3,878 
Commercial mortgage-backed securities3,378 2,748 3,407 2,729 
Total investment securities held to maturity$10,324 $8,973 $10,239 $8,702 
The following table presents interest and dividend income on investment securities:

Interest and Dividends on Investment Securities
dollars in millionsThree Months Ended March 31,
20252024
Interest income - taxable investment securities(1)
$413 $281 
Interest income - nontaxable investment securities— — 
Dividend income - marketable equity securities1 1 
Interest on investment securities$414 $282 
(1) Amount includes interest income on securities purchased under agreements to resell.

The following table presents the gross realized gain and loss on sales of investment securities available for sale, and the net realized gain on sale of marketable equity securities:

Realized Gain (Loss) on Sale of Investment Securities, Net
dollars in millionsThree Months Ended March 31,
20252024
Gross realized gain on sale of investment securities available for sale$1 $— 
Gross realized loss on sale of investment securities available for sale(2)— 
Net realized loss on sale of investment securities available for sale(1)— 
Net realized gain on sale of marketable equity securities
1 — 
Realized gain (loss) on sale of investment securities, net$— $— 

The following table provides information regarding investment securities available for sale with unrealized losses:

Gross Unrealized Losses on Debt Securities Available For Sale
dollars in millionsMarch 31, 2025
Less than 12 months12 months or moreTotal
Fair ValueUnrealized LossesFair ValueUnrealized LossesFair ValueUnrealized Losses
Investment securities available for sale
U.S. Treasury$902 $(2)$590 $(8)$1,492 $(10)
Government agency— — 69 (2)69 (2)
Residential mortgage-backed securities1,796 (10)3,531 (433)5,327 (443)
Commercial mortgage-backed securities126 (1)1,285 (185)1,411 (186)
Corporate bonds47 (1)406 (18)453 (19)
Total$2,871 $(14)$5,881 $(646)$8,752 $(660)
December 31, 2024
Less than 12 months12 months or moreTotal
Fair ValueUnrealized LossesFair ValueUnrealized LossesFair ValueUnrealized Losses
Investment securities available for sale
U.S. Treasury$3,791 $(12)$981 $(15)$4,772 $(27)
Government agency— — 77 (2)77 (2)
Residential mortgage-backed securities7,470 (61)3,575 (521)11,045 (582)
Commercial mortgage-backed securities1,183 (8)1,342 (202)2,525 (210)
Corporate bonds16 — 438 (22)454 (22)
Total$12,460 $(81)$6,413 $(762)$18,873 $(843)
As of March 31, 2025, there were 476 investment securities available for sale with continuous unrealized losses for more than 12 months, of which 416 were government sponsored enterprise-issued mortgage-backed securities, government agency securities, or U.S. Treasury securities and the remaining 60 were corporate bonds. BancShares has the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses. Given the consistently strong credit rating of the U.S. Treasury, and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, as of March 31, 2025, no allowance for credit loss was required. For corporate bonds, we analyzed the changes in interest rates relative to when the investment securities were purchased or acquired, and considered other factors including changes in credit ratings, delinquencies, and other macroeconomic factors. As a result of this analysis, we determined that no allowance for credit loss was required for investment securities available for sale as of March 31, 2025.

BancShares’ portfolio of held to maturity debt securities consists of mortgage-backed securities issued by government agencies and government sponsored entities, U.S. Treasury notes, unsecured bonds issued by government agencies and government sponsored entities, and securities issued by the Supranational Entities & Multilateral Development Banks. Given the consistently strong credit rating of the U.S. Treasury, the Supranational Entities & Multilateral Development Banks and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, no allowance for credit loss was required for debt securities held to maturity as of March 31, 2025.

There were no debt securities on nonaccrual status as of March 31, 2025 or December 31, 2024.

Investment securities having an aggregate carrying value of $4.07 billion at March 31, 2025, and $3.94 billion at December 31, 2024, were pledged as collateral to secure public funds on deposit and certain short-term borrowings, and for other purposes as required by law.
Certain investments held by BancShares are reported in other assets, including FHLB stock and nonmarketable securities without readily determinable fair values that are recorded at cost, and investments in qualified affordable housing projects, all of which are accounted for under the proportional amortization method (“PAM”).