Loans

9 Months Ended

Sep. 30, 2024

Receivables [Abstract]

Loans

Loans

Loans consisted of the following:

	September 30, 2024		December 31, 2023
	(in millions)
Commercial loans:
Real estate, including construction	$	6,795	$	7,087
Business and corporate banking	16,420		15,724
Global banking(1)	10,573		10,725
Other commercial:
Affiliates(2)	3,784		2,618
Other	3,543		3,803
Total other commercial	7,327		6,421
Total commercial	41,115		39,957
Consumer loans:
Residential mortgages	20,235		18,341
Home equity mortgages	393		389
Credit cards	185		199
Other consumer(3)	86		101
Total consumer	20,899		19,030
Total loans	$	62,014	$	58,987

(1)Represents large multinational firms including globally focused U.S. corporate and financial institutions, U.S. dollar lending to multinational banking clients managed by HSBC on a global basis and complex large business clients supported by Global Banking and Markets relationship managers.

(2)See Note 12, "Related Party Transactions," for additional information regarding loans to HSBC affiliates.

(3)Includes certain student loans that we have elected to designate under the fair value option and are therefore carried at fair value, which totaled $12 million and $15 million at September 30, 2024 and December 31, 2023, respectively. See Note 9, "Fair Value Option," for further details.

Net deferred origination costs totaled $27 million and $17 million at September 30, 2024 and December 31, 2023, respectively. At September 30, 2024 and December 31, 2023, we had a net unamortized discount on our loans of $8 million and $13 million, respectively.

Aging Analysis of Past Due Loans  The following table summarizes the past due status of our loans at September 30, 2024 and December 31, 2023. The aging of past due amounts is determined based on the contractual delinquency status of payments under the loan. An account is generally considered to be contractually delinquent when payments have not been made in accordance with the loan terms. Delinquency status is affected by customer account management policies and practices such as re-age, which results in the re-setting of the contractual delinquency status to current.

	Past Due				Total Past Due 30 Days or More
	30 - 89 Days		90+ Days				Current(1)		Total Loans
	(in millions)
At September 30, 2024
Commercial loans:
Real estate, including construction	$	—	$	21	$	21	$	6,774	$	6,795
Business and corporate banking	2		49		51		16,369		16,420
Global banking	—		47		47		10,526		10,573
Other commercial	182		—		182		7,145		7,327
Total commercial	184		117		301		40,814		41,115
Consumer loans:
Residential mortgages	172		96		268		19,967		20,235
Home equity mortgages	2		5		7		386		393
Credit cards	2		2		4		181		185
Other consumer	3		2		5		81		86
Total consumer	179		105		284		20,615		20,899
Total loans	$	363	$	222	$	585	$	61,429	$	62,014
At December 31, 2023
Commercial loans:
Real estate, including construction	$	—	$	206	$	206	$	6,881	$	7,087
Business and corporate banking	1		3		4		15,720		15,724
Global banking	—		1		1		10,724		10,725
Other commercial	350		—		350		6,071		6,421
Total commercial	351		210		561		39,396		39,957
Consumer loans:
Residential mortgages	174		91		265		18,076		18,341
Home equity mortgages	12		3		15		374		389
Credit cards	3		3		6		193		199
Other consumer	3		2		5		96		101
Total consumer	192		99		291		18,739		19,030
Total loans	$	543	$	309	$	852	$	58,135	$	58,987

(1)Loans less than 30 days past due are presented as current.

Nonperforming Loans  Nonperforming loans, including nonaccrual loans and accruing loans contractually 90 days or more past due, consisted of the following:

	Nonaccrual Loans		Accruing Loans Contractually Past Due 90 Days or More		Nonaccrual Loans With No Allowance For Credit Losses
	(in millions)
At September 30, 2024
Commercial loans:
Real estate, including construction	$	304	$	—	$	—
Business and corporate banking	59		—		6
Global banking	230		—		43
Other commercial	—		—		—
Total commercial	593		—		49
Consumer loans:
Residential mortgages(1)(2)(3)	162		—		82
Home equity mortgages(1)(2)	6		—		5
Credit cards	—		2		—
Other consumer	—		2		—
Total consumer	168		4		87
Total nonperforming loans	$	761	$	4	$	136
At December 31, 2023
Commercial loans:
Real estate, including construction	$	229	$	—	$	40
Business and corporate banking	143		1		29
Global banking	49		—		48
Other commercial	3		—		2
Total commercial	424		1		119
Consumer loans:
Residential mortgages(1)(2)(3)	172		—		81
Home equity mortgages(1)(2)	6		—		5
Credit cards	—		3		—
Other consumer	—		2		—
Total consumer	178		5		86
Total nonperforming loans	$	602	$	6	$	205

(1)At September 30, 2024 and December 31, 2023, nonaccrual consumer mortgage loans include $107 million and $108 million, respectively, of loans that are carried at the lower of amortized cost or fair value of the collateral less cost to sell.

(2)Nonaccrual consumer mortgage loans include all loans which are 90 or more days contractually delinquent as well as loans discharged under Chapter 7 bankruptcy and not re-affirmed and second lien loans where the first lien loan that we own or service is 90 or more days contractually delinquent.

(3)Nonaccrual consumer mortgage loans for all periods does not include guaranteed loans purchased from the Government National Mortgage Association. Repayment of these loans is predominantly insured by the Federal Housing Administration and as such, these loans have different risk characteristics from the rest of our consumer loan portfolio.

Interest income that was recorded on nonaccrual loans and included in interest income totaled $11 million and $19 million during the three and nine months ended September 30, 2024, respectively, compared with nil and $3 million during the three and nine months ended September 30, 2023, respectively.

Collateral-Dependent Loans Loans for which the repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty are considered to be collateral-dependent loans. Collateral can have a significant financial effect in mitigating our exposure to credit risk.

Collateral-dependent residential mortgage loans are carried at the lower of amortized cost or fair value of the collateral less costs to sell, with any excess in the carrying amount of the loan generally charged off at the time foreclosure is initiated or when settlement is reached with the borrower, but not to exceed the end of the month in which the account becomes six months contractually delinquent. Collateral values are based on broker price opinions or appraisals which are updated at least every 180 days less estimated costs to sell. During the quarterly period between updates, real estate price trends are reviewed on a geographic basis and incorporated as necessary. At September 30, 2024 and December 31, 2023, we had collateral-dependent residential mortgage loans totaling $287 million and $278 million, respectively.

For collateral-dependent commercial loans, the allowance for expected credit losses is individually assessed based on the fair value of the collateral. Various types of collateral are used, including real estate, inventory, equipment, accounts receivable, securities and cash, among others. For commercial real estate loans, collateral values are generally based on appraisals which are updated based on management judgment under the specific circumstances on a case-by-case basis. In situations where an appraisal is not used, borrower-specific factors such as operating results, cash flows and debt service ratios are reviewed along with relevant market data of comparable properties in order to create a 10-year cash flow model to be discounted at appropriate rates to present value. The collateral value for securities is based on their quoted market prices or broker quotes. The collateral value for other financial assets is generally based on appraisals or is estimated using a discounted cash flow analysis. Commercial loan balances are charged off at the time all or a portion of the balance is deemed uncollectible. At September 30, 2024 and December 31, 2023, we had collateral-dependent commercial loans totaling $611 million and $618 million, respectively.

Loan Modifications In conjunction with our loss mitigation activities, we modify certain loans to borrowers experiencing financial difficulty. Modifications may include changes to one or more terms of the loan, including, but not limited to, a change in interest rate, extension of the term, reduction in payment amount and partial forgiveness or deferment of principal, accrued interest or other loan covenants.

The following disclosures provide information about loan payment modifications made to borrowers experiencing financial difficulty in the form of an interest rate reduction, principal forgiveness, a term extension or significant payment deferral, or a combination thereof. Not included are loans with short-term payment modifications (e.g., deferrals of three months or less) and other insignificant modifications, such as covenant waivers and amendments, and deferrals of financial statement and covenant compliance reporting requirements. Commercial loan payment modifications typically involve term extensions. In certain cases, the term extension is coupled with an interest rate increase which is intended to reduce the financial effect of extending the life of the loan. The effects of these interest rate increases are not included in the following disclosures. For consumer loans, payment modifications typically involve payment deferrals or interest rate reductions which lower the amount of interest income we are contractually entitled to receive in future periods. Through lowering the interest rate, we believe we are able to increase the amount of cash flow that will ultimately be collected from the loan, given the borrower's financial condition.

The following table presents information about loan payment modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2024 and 2023 by type of modification, including the period-end carrying value and as a percentage of total loans. During the three months ended September 30, 2024, loan payment modifications made to consumer borrowers experiencing financial difficulty were nil.

	Interest Rate Reduction		Principal Forgiveness		Term Extension / Significant Payment Deferral		Combination(1)		Total		% of Total Loans
	(dollars are in millions)
Three Months Ended September 30, 2024
Commercial loans:
Real estate, including construction	$	—	$	33	$	43	$	—	$	76	1.1	%
Business and corporate banking	—		—		6		—		6		.0
Total commercial	—		33		49		—		82		.2

	Interest Rate Reduction		Principal Forgiveness		Term Extension / Significant Payment Deferral		Combination(1)		Total		% of Total Loans
	(dollars are in millions)
Three Months Ended September 30, 2023
Commercial loans:
Real estate, including construction	$	—	$	—	$	2	$	—	$	2	.0	%
Business and corporate banking	—		—		53		—		53		.3
Total commercial	—		—		55		—		55		.1
Consumer loans:
Residential mortgages(2)	—		—		2		—		2		.0
Total consumer	—		—		2		—		2		.0
Total	$	—	$	—	$	57	$	—	$	57	.1
Nine Months Ended September 30, 2024
Commercial loans:
Real estate, including construction	$	—	$	33	$	43	$	159	$	235	3.5	%
Business and corporate banking	—		—		37		5		42		.3
Global banking	—		—		35		—		35		.3
Total commercial	—		33		115		164		312		.8
Consumer loans:
Residential mortgages(2)	—		—		—		1		1		.0
Total consumer	—		—		—		1		1		.0
Total	$	—	$	33	$	115	$	165	$	313	.5
Nine Months Ended September 30, 2023
Commercial loans:
Real estate, including construction	$	—	$	—	$	172	$	—	$	172	2.5	%
Business and corporate banking	—		—		128		—		128		.8
Global banking	—		—		5		—		5		.1
Total commercial	—		—		305		—		305		.8
Consumer loans:
Residential mortgages(2)	—		—		10		1		11		.1
Total consumer	—		—		10		1		11		.1
Total	$	—	$	—	$	315	$	1	$	316	.5

(1)Represents loans with more than one type of payment modification during the period.

(2)The carrying values of consumer mortgage loans with a payment modification primarily includes loans that were recorded at the lower of amortized cost or fair value of the collateral less cost to sell.

At September 30, 2024 and December 31, 2023, additional commitments to lend to commercial borrowers who were provided with a loan payment modification during the respective year-to-date periods totaled $43 million and $85 million, respectively.

The following table summarizes the financial effect of loan payment modifications made to borrowers experiencing financial difficulty during the three and nine months ended September 30, 2024 and 2023 by type of modification:

	Weighted-Average Interest Rate Reduction		Principal Forgiven (in millions)		Weighted-Average Term Extension / Payment Deferral (in years)
Three Months Ended September 30, 2024
Commercial loans:
Real estate, including construction	—	%	$	—	2.2
Business and corporate banking	—		—		1.6
Three Months Ended September 30, 2023
Commercial loans:
Real estate, including construction	—	%	$	—	0.2
Business and corporate banking	—		—		1.1
Consumer loans:
Residential mortgages	—		—		0.8
Nine Months Ended September 30, 2024
Commercial loans:
Real estate, including construction	5.6	%	$	—	3.1
Business and corporate banking	.3		—		1.7
Global banking	—		—		2.0
Consumer loans:
Residential mortgages	.5		—		0.6
Nine Months Ended September 30, 2023
Commercial loans:
Real estate, including construction	—	%	$	—	0.4
Business and corporate banking	—		2		1.9
Global banking	—		—		2.0
Consumer loans:
Residential mortgages	2.2		—		2.0

The effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the methodology used to estimate lifetime ECL, which considers historical loss information including losses from modifications of loans to borrowers experiencing financial difficulty. As a result, a material change to the allowance for credit losses is generally not recorded upon modification. In instances when a loan is modified in the form of principal forgiveness, the amount of principal forgiven is deemed uncollectible and that portion of the loan balance is charged off with a corresponding reduction to the allowance for credit losses.

We closely monitor the performance of modified loans to understand the effectiveness of our loss mitigation efforts. Upon determination that a modified loan or a portion of a modified loan has subsequently been deemed uncollectible, the loan or a portion of the loan is charged off in accordance with our accounting policies with a corresponding reduction to the allowance for credit losses.

The following table presents loans to borrowers experiencing financial difficulty with a payment modification during the previous 12 months which subsequently became 90 days or greater contractually delinquent during the three and nine months ended September 30, 2024 by type of modification:

	Interest Rate Reduction		Principal Forgiveness		Term Extension / Significant Payment Deferral		Combination(1)		Total
	(in millions)
Nine Months Ended September 30, 2024
Commercial loans:
Global banking	$	—	$	—	$	1	$	—	$	1
Total commercial	$	—	$	—	$	1	$	—	$	1

(1)Represents loans with more than one type of payment modification during the period.

During the three and nine months ended September 30, 2024, there were no consumer loans to borrowers experiencing financial difficulty with a payment modification during the previous 12 months which subsequently became 90 days or greater contractually delinquent. During the three months ended September 30, 2024, there were also no commercial loans to borrowers experiencing financial difficulty with a payment modification during the previous 12 months which subsequently became 90 days or greater contractually delinquent. During both the three and nine months ended September 30, 2023, there were no loans to borrowers experiencing financial difficulty with a payment modification during the previous nine months which subsequently became 90 days or greater contractually delinquent.

The following table presents the past due status of loans to borrowers experiencing financial difficulty with a payment modification during the previous 12 months at September 30, 2024 and December 31, 2023:

	Past Due
	30 - 89 Days		90+ Days		Current(1)		Total
	(in millions)
At September 30, 2024
Commercial loans:
Real estate, including construction	$	—	$	—	$	236	$	236
Business and corporate banking	—		—		267		267
Global banking	—		—		74		74
Total commercial	—		—		577		577
Consumer loans:
Residential mortgages	1		—		7		8
Total consumer	1		—		7		8
Total	$	1	$	—	$	584	$	585
At December 31, 2023
Commercial loans:
Real estate, including construction	$	—	$	166	$	2	$	168
Business and corporate banking	—		—		398		398
Global banking	—		—		50		50
Total commercial	—		166		450		616
Consumer loans:
Residential mortgages	—		—		12		12
Total consumer	—		—		12		12
Total	$	—	$	166	$	462	$	628

(1)Loans less than 30 days past due are presented as current.

Commercial Loan Credit Quality Indicators and Gross Charge-offs by Year of Origination

The following credit quality indicators are utilized to monitor our commercial loan portfolio:

Criticized loans  Criticized loan classifications presented in the table below are determined by the assignment of various criticized facility risk ratings based on the risk rating standards of our regulator. The following facility risk ratings are deemed to be criticized:

Special Mention - generally includes loans that are protected by collateral and/or the credit worthiness of the customer, but are potentially weak based upon economic or market circumstances which, if not checked or corrected, could weaken our credit position at some future date.

Substandard - includes loans that are inadequately protected by the underlying collateral and/or general credit worthiness of the customer. These loans present a distinct possibility that we will sustain some loss if the deficiencies are not corrected.

Doubtful - includes loans that have all the weaknesses exhibited by substandard loans, with the added characteristic that the weaknesses make collection or liquidation in full of the recorded loan highly improbable. However, although the possibility of loss is extremely high, certain factors exist which may strengthen the credit at some future date, and therefore the decision to charge-off the loan is deferred. Loans graded as doubtful are required to be placed in nonaccrual status.

The following table summarizes our criticized commercial loans, including a disaggregation of the loans by year of origination as of September 30, 2024 and December 31, 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Sep. 30, 2024
	(in millions)
Real estate, including construction:
Special mention	$	—	$	—	$	104	$	—	$	—	$	18	$	—	$	—	$	122
Substandard	—		—		64		—		—		521		—		—		585
Doubtful	—		—		—		33		—		249		20		—		302
Total real estate, including construction	—		—		168		33		—		788		20		—		1,009
Business and corporate banking:
Special mention	172		128		104		20		4		219		148		11		806
Substandard	138		118		44		43		—		157		593		6		1,099
Doubtful	6		6		—		—		—		6		40		—		58
Total business and corporate banking	316		252		148		63		4		382		781		17		1,963
Global banking:
Special mention	—		—		—		—		—		—		37		—		37
Substandard	—		—		—		—		20		86		166		—		272
Doubtful	—		—		—		—		—		180		9		—		189
Total global banking	—		—		—		—		20		266		212		—		498
Total commercial	$	316	$	252	$	316	$	96	$	24	$	1,436	$	1,013	$	17	$	3,470
Total commercial:
Special mention	$	172	$	128	$	208	$	20	$	4	$	237	$	185	$	11	$	965
Substandard	138		118		108		43		20		764		759		6		1,956
Doubtful	6		6		—		33		—		435		69		—		549
Total commercial	$	316	$	252	$	316	$	96	$	24	$	1,436	$	1,013	$	17	$	3,470

	2023		2022		2021		2020		2019		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Dec. 31, 2023
	(in millions)
Real estate, including construction:
Special mention	$	—	$	40	$	—	$	104	$	92	$	42	$	3	$	3	$	284
Substandard	2		—		—		1		—		821		—		—		824
Doubtful	—		—		—		—		—		166		18		—		184
Total real estate, including construction	2		40		—		105		92		1,029		21		3		1,292
Business and corporate banking:
Special mention	38		103		12		4		20		126		296		8		607
Substandard	31		22		—		27		—		156		746		1		983
Doubtful	—		—		36		—		—		9		71		—		116
Total business and corporate banking	69		125		48		31		20		291		1,113		9		1,706
Global banking:
Special mention	—		—		—		—		—		45		62		—		107
Substandard	—		14		—		—		—		114		73		—		201
Doubtful	—		187		—		—		14		—		1		—		202
Total global banking	—		201		—		—		14		159		136		—		510
Other commercial:
Special mention	6		—		—		—		—		—		—		—		6
Substandard	38		—		—		—		—		—		—		—		38
Doubtful	—		—		—		—		—		—		3		—		3
Total other commercial	44		—		—		—		—		—		3		—		47
Total commercial	$	115	$	366	$	48	$	136	$	126	$	1,479	$	1,273	$	12	$	3,555
Total commercial:
Special mention	$	44	$	143	$	12	$	108	$	112	$	213	$	361	$	11	$	1,004
Substandard	71		36		—		28		—		1,091		819		1		2,046
Doubtful	—		187		36		—		14		175		93		—		505
Total commercial	$	115	$	366	$	48	$	136	$	126	$	1,479	$	1,273	$	12	$	3,555

Nonperforming  The following table summarizes the nonperforming status of our commercial loan portfolio, including a disaggregation of the loans by year of origination as of September 30, 2024 and December 31, 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Sep. 30, 2024
	(in millions)
Real estate, including construction:
Performing loans	$	638	$	1,039	$	1,217	$	850	$	262	$	2,464	$	18	$	3	$	6,491
Nonaccrual loans	—		—		—		33		—		251		20		—		304
Total real estate, including construction	638		1,039		1,217		883		262		2,715		38		3		6,795
Business and corporate banking:
Performing loans	1,403		1,350		1,118		1,261		176		4,090		6,655		308		16,361
Nonaccrual loans	6		6		—		—		—		6		41		—		59
Total business and corporate banking	1,409		1,356		1,118		1,261		176		4,096		6,696		308		16,420
Global banking:
Performing loans	935		1,768		849		660		116		4,274		1,741		—		10,343
Nonaccrual loans	—		—		—		—		—		221		9		—		230
Total global banking	935		1,768		849		660		116		4,495		1,750		—		10,573
Other commercial:
Performing loans	271		144		262		324		486		1,145		4,695		—		7,327
Nonaccrual loans	—		—		—		—		—		—		—		—		—
Total other commercial	271		144		262		324		486		1,145		4,695		—		7,327
Total commercial	$	3,253	$	4,307	$	3,446	$	3,128	$	1,040	$	12,451	$	13,179	$	311	$	41,115
Total commercial:
Performing loans	$	3,247	$	4,301	$	3,446	$	3,095	$	1,040	$	11,973	$	13,109	$	311	$	40,522
Nonaccrual loans	6		6		—		33		—		478		70		—		593
Total commercial	$	3,253	$	4,307	$	3,446	$	3,128	$	1,040	$	12,451	$	13,179	$	311	$	41,115

	2023		2022		2021		2020		2019		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Dec. 31, 2023
	(in millions)
Real estate, including construction:
Performing loans	$	920	$	1,286	$	1,019	$	355	$	1,014	$	2,242	$	19	$	3	$	6,858
Nonaccrual loans	—		—		—		—		40		167		22		—		229
Total real estate, including construction	920		1,286		1,019		355		1,054		2,409		41		3		7,087
Business and corporate banking:
Performing loans	1,270		1,113		1,074		231		561		4,215		6,851		265		15,580
Nonaccrual loans	—		35		—		—		—		38		70		—		143
Accruing loans contractually past due 90 days or more	—		—		—		—		—		—		1		—		1
Total business and corporate banking	1,270		1,148		1,074		231		561		4,253		6,922		265		15,724
Global banking:
Performing loans	2,255		1,153		844		151		321		3,561		2,341		50		10,676
Nonaccrual loans	—		—		—		—		—		39		10		—		49
Total global banking	2,255		1,153		844		151		321		3,600		2,351		50		10,725
Other commercial:
Performing loans	211		281		313		651		418		804		3,740		—		6,418
Nonaccrual loans	—		—		—		—		—		3		—		—		3
Total other commercial	211		281		313		651		418		807		3,740		—		6,421
Total commercial	$	4,656	$	3,868	$	3,250	$	1,388	$	2,354	$	11,069	$	13,054	$	318	$	39,957
Total commercial:
Performing loans	$	4,656	$	3,833	$	3,250	$	1,388	$	2,314	$	10,822	$	12,951	$	318	$	39,532
Nonaccrual loans	—		35		—		—		40		247		102		—		424
Accruing loans contractually past due 90 days or more	—		—		—		—		—		—		1		—		1
Total commercial	$	4,656	$	3,868	$	3,250	$	1,388	$	2,354	$	11,069	$	13,054	$	318	$	39,957

Credit risk profile  Commercial loans are assigned a credit rating based on the estimated probability of default. Investment grade includes loans with credit ratings of at least BBB- or above or the equivalent based on our internal credit rating system. The following table summarizes the credit risk profile of our commercial loan portfolio, including a disaggregation of the loans by year of origination as of September 30, 2024 and December 31, 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Sep. 30, 2024
	(in millions)
Real estate, including construction:
Investment grade	$	66	$	323	$	26	$	—	$	166	$	593	$	—	$	—	$	1,174
Non-investment grade	572		716		1,191		883		96		2,122		38		3		5,621
Total real estate, including construction	638		1,039		1,217		883		262		2,715		38		3		6,795
Business and corporate banking:
Investment grade	662		507		351		590		86		1,842		3,018		89		7,145
Non-investment grade	747		849		767		671		90		2,254		3,678		219		9,275
Total business and corporate banking	1,409		1,356		1,118		1,261		176		4,096		6,696		308		16,420
Global banking:
Investment grade	811		1,448		751		558		96		3,714		1,438		—		8,816
Non-investment grade	124		320		98		102		20		781		312		—		1,757
Total global banking	935		1,768		849		660		116		4,495		1,750		—		10,573
Other commercial:
Investment grade	171		95		136		30		357		845		4,469		—		6,103
Non-investment grade	100		49		126		294		129		300		226		—		1,224
Total other commercial	271		144		262		324		486		1,145		4,695		—		7,327
Total commercial	$	3,253	$	4,307	$	3,446	$	3,128	$	1,040	$	12,451	$	13,179	$	311	$	41,115
Total commercial:
Investment grade	$	1,710	$	2,373	$	1,264	$	1,178	$	705	$	6,994	$	8,925	$	89	$	23,238
Non-investment grade	1,543		1,934		2,182		1,950		335		5,457		4,254		222		17,877
Total commercial	$	3,253	$	4,307	$	3,446	$	3,128	$	1,040	$	12,451	$	13,179	$	311	$	41,115

	2023		2022		2021		2020		2019		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total at Dec. 31, 2023
	(in millions)
Real estate, including construction:
Investment grade	$	327	$	100	$	24	$	187	$	162	$	939	$	1	$	—	$	1,740
Non-investment grade	593		1,186		995		168		892		1,470		40		3		5,347
Total real estate, including construction	920		1,286		1,019		355		1,054		2,409		41		3		7,087
Business and corporate banking:
Investment grade	732		304		543		95		261		1,977		3,311		54		7,277
Non-investment grade	538		844		531		136		300		2,276		3,611		211		8,447
Total business and corporate banking	1,270		1,148		1,074		231		561		4,253		6,922		265		15,724
Global banking:
Investment grade	1,947		1,109		651		149		307		2,842		2,140		—		9,145
Non-investment grade	308		44		193		2		14		758		211		50		1,580
Total global banking	2,255		1,153		844		151		321		3,600		2,351		50		10,725
Other commercial:
Investment grade	211		192		43		376		298		564		3,143		—		4,827
Non-investment grade	—		89		270		275		120		243		597		—		1,594
Total other commercial	211		281		313		651		418		807		3,740		—		6,421
Total commercial	$	4,656	$	3,868	$	3,250	$	1,388	$	2,354	$	11,069	$	13,054	$	318	$	39,957
Total commercial:
Investment grade	$	3,217	$	1,705	$	1,261	$	807	$	1,028	$	6,322	$	8,595	$	54	$	22,989
Non-investment grade	1,439		2,163		1,989		581		1,326		4,747		4,459		264		16,968
Total commercial	$	4,656	$	3,868	$	3,250	$	1,388	$	2,354	$	11,069	$	13,054	$	318	$	39,957

Gross Charge-offs  The following table summarizes gross charge-off dollars in our commercial loan portfolio, disaggregated by year of origination, during the nine months ended September 30, 2024 and 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total
	(in millions)
Nine Months Ended September 30, 2024
Business and corporate banking	$	—	$	—	$	—	$	32	$	—	$	21	$	1	$	—	$	54
Global banking	—		—		—		—		—		3		—		—		3
Total commercial	$	—	$	—	$	—	$	32	$	—	$	24	$	1	$	—	$	57
	2023		2022		2021		2020		2019		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total
	(in millions)
Nine Months Ended September 30, 2023
Business and corporate banking	$	—	$	—	$	17	$	—	$	—	$	9	$	14	$	—	$	40
Total commercial	$	—	$	—	$	17	$	—	$	—	$	9	$	14	$	—	$	40

Consumer Loan Credit Quality Indicators and Gross Charge-offs by Year of Origination

The following credit quality indicators are utilized to monitor our consumer loan portfolio:

Delinquency  The following table summarizes dollars of two-months-and-over contractual delinquency for our consumer loan portfolio, including a disaggregation of the loans by year of origination as of September 30, 2024 and December 31, 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Total at Sep. 30, 2024
	(in millions)
Residential mortgages(1)(2)	$	—	$	1	$	9	$	4	$	9	$	104	$	—	$	127
Home equity mortgages(1)(2)	—		—		—		—		—		5		—		5
Credit cards	—		—		—		—		—		—		4		4
Other consumer	—		—		—		—		1		2		—		3
Total consumer	$	—	$	1	$	9	$	4	$	10	$	111	$	4	$	139

	2023		2022		2021		2020		2019		Prior		Revolving Loans		Total at Dec. 31, 2023
	(in millions)
Residential mortgages(1)(2)	$	—	$	2	$	6	$	6	$	1	$	100	$	—	$	115
Home equity mortgages(1)(2)	—		—		—		—		—		4		—		4
Credit cards	—		—		—		—		—		—		4		4
Other consumer	—		—		—		—		—		2		—		2
Total consumer	$	—	$	2	$	6	$	6	$	1	$	106	$	4	$	125

(1)At September 30, 2024 and December 31, 2023, consumer mortgage loan delinquency includes $69 million and $61 million, respectively, of loans that are carried at the lower of amortized cost or fair value of the collateral less cost to sell.

(2)At September 30, 2024 and December 31, 2023, consumer mortgage loans include $33 million and $21 million, respectively, of loans that were in the process of foreclosure.

Nonperforming  The following table summarizes the nonperforming status of our consumer loan portfolio, including a disaggregation of the loans by year of origination as of September 30, 2024 and December 31, 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Total at Sep. 30, 2024
	(in millions)
Residential mortgages:
Performing loans	$	2,996	$	2,443	$	2,653	$	3,958	$	2,639	$	5,384	$	—	$	20,073
Nonaccrual loans	—		—		7		7		10		138		—		162
Total residential mortgages	2,996		2,443		2,660		3,965		2,649		5,522		—		20,235
Home equity mortgages:
Performing loans	38		80		67		9		18		175		—		387
Nonaccrual loans	—		—		—		—		—		6		—		6
Total home equity mortgages	38		80		67		9		18		181		—		393
Credit cards:
Performing loans	—		—		—		—		—		—		183		183
Accruing loans contractually past due 90 days or more	—		—		—		—		—		—		2		2
Total credit cards	—		—		—		—		—		—		185		185
Other consumer:
Performing loans	—		—		4		10		5		60		5		84
Accruing loans contractually past due 90 days or more	—		—		—		—		—		2		—		2
Total other consumer	—		—		4		10		5		62		5		86
Total consumer	$	3,034	$	2,523	$	2,731	$	3,984	$	2,672	$	5,765	$	190	$	20,899
Total consumer:
Performing loans	$	3,034	$	2,523	$	2,724	$	3,977	$	2,662	$	5,619	$	188	$	20,727
Nonaccrual loans	—		—		7		7		10		144		—		168
Accruing loans contractually past due 90 days or more	—		—		—		—		—		2		2		4
Total consumer	$	3,034	$	2,523	$	2,731	$	3,984	$	2,672	$	5,765	$	190	$	20,899

	2023		2022		2021		2020		2019		Prior		Revolving Loans		Total at Dec. 31, 2023
	(in millions)
Residential mortgages:
Performing loans	$	2,646	$	2,753	$	4,096	$	2,761	$	1,236	$	4,677	$	—	$	18,169
Nonaccrual loans	—		11		11		9		8		133		—		172
Total residential mortgages	2,646		2,764		4,107		2,770		1,244		4,810		—		18,341
Home equity mortgages:
Performing loans	80		69		11		22		25		176		—		383
Nonaccrual loans	—		—		—		—		—		6		—		6
Total home equity mortgages	80		69		11		22		25		182		—		389
Credit cards:
Performing loans	—		—		—		—		—		—		196		196
Accruing loans contractually past due 90 days or more	—		—		—		—		—		—		3		3
Total credit cards	—		—		—		—		—		—		199		199
Other consumer:
Performing loans	—		8		7		7		3		67		7		99
Accruing loans contractually past due 90 days or more	—		—		—		—		—		2		—		2
Total other consumer	—		8		7		7		3		69		7		101
Total consumer	$	2,726	$	2,841	$	4,125	$	2,799	$	1,272	$	5,061	$	206	$	19,030
Total consumer:
Performing loans	$	2,726	$	2,830	$	4,114	$	2,790	$	1,264	$	4,920	$	203	$	18,847
Nonaccrual loans	—		11		11		9		8		139		—		178
Accruing loans contractually past due 90 days or more	—		—		—		—		—		2		3		5
Total consumer	$	2,726	$	2,841	$	4,125	$	2,799	$	1,272	$	5,061	$	206	$	19,030

Gross Charge-offs  The following table summarizes gross charge-off dollars in our consumer loan portfolio, disaggregated by year of origination, during the nine months ended September 30, 2024 and 2023:

	2024		2023		2022		2021		2020		Prior		Revolving Loans		Total
	(in millions)
Nine Months Ended September 30, 2024
Credit cards	$	—	$	—	$	—	$	—	$	—	$	—	$	6	$	6
Other consumer	—		—		—		—		—		1		—		1
Total consumer	$	—	$	—	$	—	$	—	$	—	$	1	$	6	$	7
	2023		2022		2021		2020		2019		Prior		Revolving Loans		Total
	(in millions)
Nine Months Ended September 30, 2023
Residential mortgages	$	—	$	—	$	—	$	—	$	—	$	4	$	—	$	4
Home equity mortgages	—		—		—		—		—		1		—		1
Credit cards	—		—		—		—		—		—		6		6
Other consumer	—		—		—		—		—		1		—		1
Total consumer	$	—	$	—	$	—	$	—	$	—	$	6	$	6	$	12

Concentration of Credit Risk  At September 30, 2024 and December 31, 2023, our loan portfolios included interest-only residential mortgage and home equity mortgage loans totaling $4,564 million and $4,392 million, respectively. An interest-only residential mortgage loan allows a customer to pay the interest-only portion of the monthly payment for a period of time which results in lower payments during the initial loan period. However, subsequent events affecting a customer's financial position could affect the ability of customers to repay the loan in the future when the principal payments are required which increases the credit risk of this loan type.