Fair Value Measurements

12 Months Ended

Dec. 31, 2025

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Accounting principles related to fair value measurements provide a framework for measuring fair value that focuses on the exit price that would be received to sell an asset or paid to transfer a liability in the principal market (or in the absence of the principal market, the most advantageous market) accessible in an orderly transaction between willing market participants (the "Fair Value Framework"). Where required by the applicable accounting standards, assets and liabilities are measured at fair value using the "highest and best use" valuation premise. The fair value measurement guidance permits an entity to measure the fair value of a group of financial assets and financial liabilities with offsetting credit risks and/or market risks on a net basis provided certain conditions are met. We elected to apply the measurement exception to a group of derivative instruments which primarily relate to interest rate, foreign currency, debt and equity price risk, and commodity price risk as of the reporting date.

Fair Value Adjustments  The best evidence of fair value is quoted market price in an actively traded market. When listed price or market quotes are not available, different valuation methods and model inputs are used to estimate fair value. Adjustments are made to the model estimates to encompass counterparty or own credit risk, liquidity risk, model risk and funding benefit/cost associated with uncollateralized derivatives. Major fair value adjustments include:

Bid-offer adjustment - Valuation models generally produce mid-market values for the individual instruments. The bid-offer adjustment is made to the overall net risk exposure to reflect the exit price.

Market data uncertainty adjustment - Certain model inputs may be less readily determinable from market data and/or the choice of model itself may be more subjective. In these circumstances, an adjustment may be necessary to reflect the likelihood that market participants would adopt more conservative values for uncertain parameters and/or model assumptions than those used in our valuation model.

Credit valuation adjustment ("CVA") - The CVA is an adjustment to the valuation of OTC derivative contracts to reflect the possibility that the counterparty may default and that we may not receive the full market value of the transactions.

Funding fair value adjustment ("FFVA") - The FFVA reflects the estimated present value of the future market funding cost or benefit associated with funding uncollateralized derivative exposure at unsecured funding spreads.

See "Valuation Techniques - Structured notes and deposits designated under FVO" and "Long-term debt designated under FVO" below for discussion of the fair value adjustments on FVO liabilities attributable to our own credit spread.

Fair Value Hierarchy  The Fair Value Framework establishes a three-tiered fair value hierarchy as follows:

Level 1 quoted market price - Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 valuation technique using observable inputs - Level 2 inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are inactive, and measurements determined using valuation models where all significant inputs are observable, such as interest rates and yield curves that are observable at commonly quoted intervals.

Level 3 valuation technique with significant unobservable inputs - Level 3 inputs are unobservable inputs for the asset or liability and include situations where fair values are measured using valuation techniques based on one or more significant unobservable inputs.

Classification within the fair value hierarchy is based on whether the lowest hierarchical level input that is significant to the fair value measurement is observable. As such, the classification within the fair value hierarchy is dynamic and can be transferred to other hierarchy levels in each reporting period.

Where fair value measurements are determined based on information obtained from independent pricing services or brokers, we apply appropriate validation procedures to substantiate fair value. For price validation purposes, quotations from at least two independent pricing sources are obtained for each financial instrument, where possible.

Assets and Liabilities Recorded at Fair Value on a Recurring Basis  The following table presents information about our assets and liabilities measured at fair value on a recurring basis, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value. Unless otherwise noted below, assets and liabilities in the following table are recorded at fair value through net income.

	Fair Value Measurements on a Recurring Basis
December 31, 2025	Level 1		Level 2		Level 3		Gross Balance		Netting(1)		Net Balance
	(in millions)
Assets:
Trading assets, excluding derivatives:
U.S. Treasury, U.S. Government agencies and sponsored enterprises	$	3,791	$	1,349	$	—	$	5,140	$	—	$	5,140
Debt securities issued by foreign entities	837		77		—		914		—		914
Equity securities	15,141		—		—		15,141		—		15,141
Precious metals trading	—		196		—		196		—		196
Derivatives:(2)
Interest rate contracts	8		777		1		786		—		786
Foreign exchange contracts	—		9,572		9		9,581		—		9,581
Equity contracts	—		1,174		85		1,259		—		1,259
Precious metals contracts	—		1,883		—		1,883		—		1,883
Credit contracts	—		137		—		137		—		137
Other contracts(3)	—		—		4		4		—		4
Derivatives netting	—		—		—		—		(12,109)		(12,109)
Total derivatives	8		13,543		99		13,650		(12,109)		1,541
Securities available-for-sale:(4)
U.S. Treasury, U.S. Government agencies and sponsored enterprises	14,277		11,349		—		25,626		—		25,626
Asset-backed securities	—		187		76		263		—		263
Debt securities issued by foreign entities	4,141		—		—		4,141		—		4,141
Loans held for sale(5)	—		460		166		626		—		626
Other assets:
Equity securities	—		131		—		131		—		131
Equity securities measured at net asset value(6)	—		—		—		112		—		112
Total assets	$	38,195	$	27,292	$	341	$	65,940	$	(12,109)	$	53,831
Liabilities:
Domestic deposits(5)	$	—	$	3,193	$	377	$	3,570	$	—	$	3,570
Trading liabilities, excluding derivatives	1,438		86		—		1,524		—		1,524
Derivatives:(2)
Interest rate contracts	5		509		2		516		—		516
Foreign exchange contracts	—		8,916		8		8,924		—		8,924
Equity contracts	—		561		74		635		—		635
Precious metals contracts	2		2,048		—		2,050		—		2,050
Credit contracts	—		216		1		217		—		217
Other contracts(3)	—		—		17		17		—		17
Derivatives netting	—		—		—		—		(11,341)		(11,341)
Total derivatives	7		12,250		102		12,359		(11,341)		1,018
Long-term debt(5)	—		5,912		2,354		8,266		—		8,266
Total liabilities	$	1,445	$	21,441	$	2,833	$	25,719	$	(11,341)	$	14,378

	Fair Value Measurements on a Recurring Basis
December 31, 2024	Level 1		Level 2		Level 3		Gross Balance		Netting(1)		Net Balance
	(in millions)
Assets:
Trading assets, excluding derivatives:
U.S. Treasury, U.S. Government agencies and sponsored enterprises	$	3,676	$	1,167	$	—	$	4,843	$	—	$	4,843
Debt securities issued by foreign entities	783		—		—		783		—		783
Equity securities	13,844		—		—		13,844		—		13,844
Precious metals trading	—		163		—		163		—		163
Derivatives:(2)
Interest rate contracts	2		1,118		2		1,122		—		1,122
Foreign exchange contracts	—		16,386		5		16,391		—		16,391
Equity contracts	—		970		46		1,016		—		1,016
Precious metals contracts	—		1,220		—		1,220		—		1,220
Credit contracts	—		271		—		271		—		271
Other contracts(3)	—		—		5		5		—		5
Derivatives netting	—		—		—		—		(18,270)		(18,270)
Total derivatives	2		19,965		58		20,025		(18,270)		1,755
Securities available-for-sale:(4)
U.S. Treasury, U.S. Government agencies and sponsored enterprises	10,716		10,603		—		21,319		—		21,319
Asset-backed securities	—		—		97		97		—		97
Debt securities issued by foreign entities	3,521		—		—		3,521		—		3,521
Loans held for sale(5)	—		241		154		395		—		395
Other assets:
Equity securities	—		126		—		126		—		126
Equity securities measured at net asset value(6)	—		—		—		124		—		124
Total assets	$	32,542	$	32,265	$	309	$	65,240	$	(18,270)	$	46,970
Liabilities:
Domestic deposits(5)	$	—	$	3,665	$	291	$	3,956	$	—	$	3,956
Trading liabilities, excluding derivatives	1,489		70		—		1,559		—		1,559
Derivatives:(2)
Interest rate contracts	2		725		5		732		—		732
Foreign exchange contracts	—		16,236		5		16,241		—		16,241
Equity contracts	—		759		64		823		—		823
Precious metals contracts	—		1,092		—		1,092		—		1,092
Credit contracts	—		198		1		199		—		199
Other contracts(3)	—		—		31		31		—		31
Derivatives netting	—		—		—		—		(16,636)		(16,636)
Total derivatives	2		19,010		106		19,118		(16,636)		2,482
Long-term debt(5)	—		5,742		2,153		7,895		—		7,895
Total liabilities	$	1,491	$	28,487	$	2,550	$	32,528	$	(16,636)	$	15,892

(1)Represents counterparty and cash collateral netting which allow the offsetting of amounts relating to certain contracts if certain conditions are met.

(2)Includes trading derivative assets of $1,366 million and $1,598 million and trading derivative liabilities of $831 million and $2,348 million at December 31, 2025 and 2024, respectively, as well as derivatives held for hedging and other non-qualifying economic hedging activities. See Note 14, "Derivative Financial Instruments," for additional information. Excluding changes in fair value of a derivative instrument associated with a qualifying cash flow hedge, which are recognized initially in other comprehensive income, derivative assets and liabilities are recorded at fair value through net income.

(3)Consists of swap agreements entered into in conjunction with the sales of Visa Class B Shares.

(4)Securities available-for-sale are recorded at fair value through other comprehensive income. Changes in the allowance for credit losses on securities available-for-sale are recorded through net income.

(5)See Note 15, "Fair Value Option," for additional information. Excluding the fair value movement on FVO liabilities attributable to our own credit spread, which is recorded in other comprehensive income, FVO assets and liabilities are recorded at fair value through net income.

(6)Investments that are measured at fair value using the net asset value per share practical expedient have not been classified in the fair value hierarchy.

Information on Significant Level 3 assets and liabilities  The following table summarizes additional information about changes in the fair value of significant Level 3 assets and liabilities. As a risk management practice, we may risk manage the Level 3 assets and liabilities, in whole or in part, using securities and derivative positions that are classified as Level 1 or Level 2 measurements within the fair value hierarchy. Since those Level 1 and Level 2 risk management positions are not included in the table below, the information provided does not reflect the effect of such risk management activities related to the Level 3 assets and liabilities.

	Jan. 1, 2025		Total Realized / Unrealized Gains (Losses) Included in				Purch- ases		Issu- ances		Settle- ments		Transfers Into Level 3		Transfers Out of Level 3		Dec. 31, 2025		Current Period Unrealized Gains (Losses) Still Held Included in
			Earnings		Other Compre- hensive Income														Earnings		Other Compre- hensive Income
	(in millions)
Assets:
Derivatives, net:(1)
Equity contracts	$	(18)	$	157	$	—	$	—	$	—	$	(65)	$	(17)	$	(46)	$	11	$	80	$	—
Other contracts(2)	(26)		(22)		—		—		—		35		—		—		(13)		—		—
Asset-backed securities available-for-sale(3)	97		—		2		—		—		(15)		—		(8)		76		—		2
Loans held for sale(4)	154		(58)		—		11		180		(147)		26		—		166		(58)		—
Total assets	$	207	$	77	$	2	$	11	$	180	$	(192)	$	9	$	(54)	$	240	$	22	$	2
Liabilities:
Domestic deposits(4)	$	(291)	$	(36)	$	—	$	—	$	(232)	$	48	$	(325)	$	459	$	(377)	$	(70)	$	—
Long-term debt(4)	(2,153)		(267)		(4)		—		(2,380)		1,423		(1,330)		2,357		(2,354)		(274)		(4)
Total liabilities	$	(2,444)	$	(303)	$	(4)	$	—	$	(2,612)	$	1,471	$	(1,655)	$	2,816	$	(2,731)	$	(344)	$	(4)

	Jan. 1, 2024		Total Realized / Unrealized Gains (Losses) Included in				Purch- ases		Issu- ances		Settle- ments		Transfers Into Level 3		Transfers Out of Level 3		Dec. 31, 2024		Current Period Unrealized Gains (Losses) Still Held Included in
			Earnings		Other Compre- hensive Income														Earnings		Other Compre- hensive Income
	(in millions)
Assets:
Derivatives, net:(1)
Equity contracts	$	21	$	88	$	—	$	—	$	—	$	(50)	$	(4)	$	(73)	$	(18)	$	(3)	$	—
Other contracts(2)	(35)		(35)		—		—		—		44		—		—		(26)		—		—
Asset-backed securities available-for-sale(3)	104		—		(2)		—		—		(5)		—		—		97		—		(2)
Loans held for sale(4)	32		3		—		54		—		(84)		168		(19)		154		5		—
Total assets	$	122	$	56	$	(2)	$	54	$	—	$	(95)	$	164	$	(92)	$	207	$	2	$	(2)
Liabilities:
Domestic deposits(4)	$	(293)	$	(16)	$	(4)	$	—	$	(276)	$	89	$	(78)	$	287	$	(291)	$	5	$	(4)
Long-term debt(4)	(1,919)		(255)		(4)		—		(2,360)		1,325		(387)		1,447		(2,153)		(59)		(4)
Total liabilities	$	(2,212)	$	(271)	$	(8)	$	—	$	(2,636)	$	1,414	$	(465)	$	1,734	$	(2,444)	$	(54)	$	(8)

(1)Level 3 net derivatives included derivative assets of $99 million and derivative liabilities of $102 million at December 31, 2025 and derivative assets of $58 million and derivative liabilities of $106 million at December 31, 2024. Gains (losses) on derivatives, net are predominantly included in trading revenue and gain (loss) on instruments designated at fair value and related derivatives in the consolidated statement of income.

(2)Consists of swap agreements entered into in conjunction with the sales of Visa Class B Shares. Gains (losses) on these swap agreements are included in other income (loss) in the consolidated statement of income.

(3)Realized gains (losses) on securities available-for-sale are included in other securities gains (losses), net in the consolidated statement of income. Changes in the allowance for credit losses on securities available-for-sale are included in the provision for credit losses in the consolidated statement of income. Unrealized gains (losses) on securities available-for-sale are included in other comprehensive income.

(4)Excluding unrealized gains (losses) on FVO liabilities attributable to our own credit spread, which are recorded in other comprehensive income, gains (losses) on FVO assets and liabilities are included in gain (loss) on instruments designated at fair value and related derivatives in the consolidated statement of income.

Significant Transfers Into and Out of Level 3 Measurements During 2025, we transferred domestic deposits and long-term debt, which we have elected to carry at fair value, from Level 3 to Level 2 as a result of the embedded derivative no longer being unobservable as the derivative option is closer to maturity and the underlying inputs have become more observable. During 2025, we transferred domestic deposits and long-term debt, which we elected to carry at fair value, from Level 2 to Level 3 as a result of a change in the observability of underlying inputs that resulted in the embedded derivative being unobservable.

During 2024, we transferred domestic deposits and long-term debt, which we have elected to carry at fair value, from Level 3 to Level 2 as a result of the embedded derivative no longer being unobservable as the derivative option is closer to maturity and the underlying inputs have become more observable. During 2024, we transferred long-term debt, which we elected to carry at fair value, from Level 2 to Level 3 as a result of a change in the observability of underlying inputs that resulted in the embedded derivative being unobservable. During 2024, we also transferred commercial loans held for sale from Level 2 to Level 3 as the inputs used to value these loans have become less observable.

Significant Unobservable Inputs for Recurring Fair Value Measurements

The following table presents quantitative information about the unobservable inputs used to determine the recurring fair value measurement of significant assets and liabilities classified as Level 3 fair value measurements:

December 31, 2025
Financial Instrument Type	Fair Value (in millions)		Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average(1)
Equity derivative contracts(2)	$	11	Option pricing model	Equity / Equity Index volatility	5% - 90%	60%
				Equity / Equity and Equity / Index correlation	42% - 98%	84%
				Equity forward price	$0 - $57,523	$2,773
Other derivative contracts	$	(13)	Discounted cash flows	Conversion rate	1.5 times	N/A
				Expected duration	0.3 years	N/A
Asset-backed securities available-for-sale	$	76	Discounted cash flows	Market assumptions related to yields for comparable instruments	2% - 3%	2%
Loans held for sale	$	166	Market comparables and internal assumptions	Adjusted market price	28% - 100%	74%
Domestic deposits (structured deposits)(2)(3)	$	(377)	Option adjusted discounted cash flows	Equity / Equity Index volatility	5% - 45%	12%
				Equity / Equity and Equity / Index correlation	42% - 93%	75%
Long-term debt (structured notes)(2)(3)	$	(2,354)	Option adjusted discounted cash flows	Equity / Equity Index volatility	12% - 72%	31%
				Equity / Equity and Equity / Index correlation	48% - 98%	86%
				Credit default swap spreads	722bps	N/A

December 31, 2024
Financial Instrument Type	Fair Value (in millions)		Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average(1)
Equity derivative contracts(2)	$	(18)	Option pricing model	Equity / Equity Index volatility	6% - 118%	24%
				Equity / Equity and Equity / Index correlation	27% - 98%	74%
				Equity forward price	$0 - $26,542	$1,238
Other derivative contracts	$	(26)	Discounted cash flows	Conversion rate	1.5 times	N/A
				Expected duration	1.3 years	N/A
Asset-backed securities available-for-sale	$	97	Discounted cash flows	Market assumptions related to yields for comparable instruments	2% - 3%	2%
Loans held for sale	$	154	Market comparables and internal assumptions	Adjusted market price	94% - 101%	100%
Domestic deposits (structured deposits)(2)(3)	$	(291)	Option adjusted discounted cash flows	Equity / Equity Index volatility	6% - 54%	14%
				Equity / Equity and Equity / Index correlation	40% - 93%	66%
Long-term debt (structured notes)(2)(3)	$	(2,153)	Option adjusted discounted cash flows	Equity / Equity Index volatility	6% - 59%	24%
				Equity / Equity and Equity / Index correlation	27% - 98%	80%
				Credit default swap spreads	728bps	N/A

N/A Not Applicable

(1)For equity derivatives, structured deposits and structured notes, weighted averages are calculated based on the fair value of the instruments. For all remaining instrument types, weighted averages are calculated based on the notional value of the instruments.

(2)We are the client-facing entity and, except for structured notes with embedded credit derivative features, we enter into identical but opposite derivatives to transfer the resultant risks to our affiliates. With the exception of counterparty credit risks, we are market risk neutral in substantially all of the structured notes and deposits. The corresponding intra-group derivatives are presented as equity derivatives in the table.

(3)Structured deposits and structured notes contain embedded derivative features whose fair value measurements contain significant Level 3 inputs. See equity derivatives and credit derivatives below for a discussion of the uncertainty of Level 3 inputs related to structured deposits and structured notes.

Uncertainty of Significant Level 3 Inputs to Fair Value Measurements

Equity derivatives - For certain equity derivatives, particularly those with long-dated maturities and/or strike values far from at-the-money, volatility can be unobservable. A significant increase (decrease) in the implied volatility would have resulted in a higher (lower) fair value of a long position in the derivative contract. For a derivative referenced to a basket of equities, the fair value measurement is also affected by the correlation of the referenced equities, which can also be unobservable. Correlation measures the relative change in values among two or more variables (i.e., equity pair), which can be positively or negatively correlated. A significant increase (decrease) in the correlation of the referenced variables would have resulted in a higher (lower) fair value of a long position in the derivative contract. In addition, for the majority of unlisted equities and some listed equities, the forward price is unobservable. A significant increase (decrease) in the price would have resulted in a higher (lower) fair value of a long position in the derivative contract.

Credit derivatives - The fair value measurement of certain credit derivatives is primarily affected by the credit spreads of credit default swap contracts. A significant increase (decrease) in the credit spreads would have resulted in a higher (lower) fair value measurement of a long position in the credit derivative.

Other derivatives - The fair value of the swap agreements we entered into in conjunction with the sales of Visa Class B Shares is dependent upon the final resolution of the related litigation. Significant unobservable inputs used in the fair value measurement include estimated changes in the conversion rate of Visa Class B Shares into Visa Class A Shares and the expected timing of the final resolution. An increase (decrease) in the loss estimate or in the timing of the resolution of the related litigation would have resulted in a higher (lower) fair value measurement of the derivative.

Asset-backed securities available-for-sale - The fair value measurement of certain asset-backed securities is primarily affected by estimated yields which are determined based on current market yields of comparable instruments adjusted for market liquidity. An increase (decrease) in the yields would have resulted in a lower (higher) fair value measurement of the securities.

Loans held for sale - The fair value measurement of certain commercial loans held for sale is affected by estimated market prices which are unobservable. An increase (decrease) in the estimated prices would have resulted in a higher (lower) fair value measurement of the loans.

Assets and Liabilities Recorded at Fair Value on a Non-recurring Basis  Certain financial and non-financial assets are measured at fair value on a non-recurring basis and therefore, are not included in the tables above. These assets include (a) loans classified as held for sale reported at the lower of amortized cost or fair value and (b) impaired loans or assets that are written down to fair value based on the valuation of underlying collateral during the period. These instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustment in certain circumstances (e.g., impairment). The following table presents the fair value hierarchy level within which the fair value of the financial and non-financial assets has been recorded at December 31, 2025 and 2024. The gains (losses) during 2025 and 2024 are also included.

	Non-Recurring Fair Value Measurements at December 31, 2025								Total Gains (Losses) For the Year Ended December 31, 2025
	Level 1		Level 2		Level 3		Total
	(in millions)
Consumer loans(1)	$	—	$	94	$	—	$	94	$	2
Commercial loans held for sale(2)	—		1,277		—		1,277		(4)
Commercial loans(3)	—		—		342		342		(87)
Total assets at fair value on a non-recurring basis	$	—	$	1,371	$	342	$	1,713	$	(89)

	Non-Recurring Fair Value Measurements at December 31, 2024								Total Gains (Losses) For the Year Ended December 31, 2024
	Level 1		Level 2		Level 3		Total
	(in millions)
Consumer loans(1)	$	—	$	100	$	—	$	100	$	3
Commercial loans held for sale	—		—		—		—		2
Commercial loans(3)	—		—		350		350		(54)
Total assets at fair value on a non-recurring basis	$	—	$	100	$	350	$	450	$	(49)

(1)Represents residential mortgage loans held for investment whose carrying amount was adjusted during the period based on the fair value of the underlying collateral.

(2)At December 31, 2025, the fair value of the loans held for sale was below cost.

(3)Certain commercial loans are individually assessed for impairment. We measure the credit impairment of a collateral-dependent loan based on the fair value of the collateral asset. The collateral often involves real estate properties that are illiquid due to market conditions. As a result, these loans are classified as a Level 3 fair value measurement within the fair value hierarchy.

Significant Unobservable Inputs for Non-Recurring Fair Value Measurements

The following tables present quantitative information about non-recurring fair value measurements of assets and liabilities classified with Level 3 of the fair value hierarchy:

At December 31, 2025
Financial Instrument Type	Fair Value (in millions)		Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average(1)
Commercial loans	$	342	Valuation of third-party appraisal on underlying collateral	Loss severity rates	0% - 100%	30%

At December 31, 2024
Financial Instrument Type	Fair Value (in millions)		Valuation Technique(s)	Significant Unobservable Inputs	Range of Inputs	Weighted Average(1)
Commercial loans	$	350	Valuation of third-party appraisal on underlying collateral	Loss severity rates	8% - 100%	26%

(1)Weighted average is calculated based on the carrying value of the loans.

Valuation Techniques

Following is a description of valuation methodologies used for assets and liabilities recorded at fair value.

Commercial loans held for sale designated under FVO – We elected to apply FVO accounting to certain commercial loans held for sale and related unfunded commitments. Where available fair value is based on observable market pricing obtained from independent sources, relevant broker quotes or observed market prices of instruments with similar characteristics. Where observable market parameters are not available, fair value is determined based on contractual cash flows adjusted for estimates of prepayment rates, expected default rates and loss severity discounted at management's estimate of the expected rate of return required by market participants. We also consider loan-specific risk mitigating factors such as collateral arrangements in

determining the fair value estimate. We also may hold discussion on value directly with potential investors. For certain commercial loans held for sale, the fair value measurement process uses significant unobservable inputs to adjust market prices which are specific to the characteristics of the loans.

Commercial loans held for sale – Commercial loans held for sale (that are not designated under FVO as discussed above) are recorded at the lower of amortized cost or fair value. The fair value of commercial loans held for sale is estimated using observable market pricing obtained from independent sources, relevant broker quotes or observed market prices of instruments with similar characteristics. We also may hold discussion on value directly with potential investors or take into account underlying collateral values.

Precious metals trading – Precious metals trading primarily includes physical inventory which is valued using spot prices.

Securities - Where available, debt and equity securities are valued based on quoted market prices. If a quoted market price for the identical security is not available, the security is valued based on quotes from similar securities, where possible. For certain securities, internally developed valuation models are used to determine fair values or validate quotes obtained from pricing services. The following summarizes the valuation methodology used for our major security classes:

•U.S. Treasury, U.S. Government agency and U.S. Government sponsored enterprises – As these securities transact in an active market, fair value measurements are based on quoted prices for the identical security or quoted prices for similar securities with adjustments as necessary made using observable inputs which are market corroborated. For certain government securities which do not transact in an active market, fair value is determined primarily based on pricing information obtained from pricing services and is verified by internal review processes.

•Asset-backed securities – Fair value is primarily determined based on pricing information obtained from independent pricing services adjusted for the characteristics and the performance of the underlying collateral.

•Foreign debt securities - Government and public sector entity/bank securities primarily transact in an active market and therefore fair value measurements are based on quoted prices for the identical security or quoted prices for similar securities with adjustments as necessary made using observable inputs which are market corroborated.

•Equity securities – Fair value measurements are determined based on quoted prices for the identical security. Certain equity securities represent investments in private equity funds that help us comply with the Community Reinvestment Act. The fair value of these investments are estimated using the net asset value per share as calculated by the fund managers. Distributions will be received from the funds as the underlying assets are liquidated. While the funds do not allow us to redeem our investments, we are permitted to sell or transfer our investments subject to the approval of the fund manager. Unfunded commitments associated with these investments totaled $20 million at both December 31, 2025 and 2024.

Derivatives – Derivatives are recorded at fair value. Asset and liability positions in individual derivatives that are covered by legally enforceable master netting agreements, including receivables (payables) for cash collateral posted (received), are offset and presented net in accordance with accounting principles which allow the offsetting of amounts.

Derivatives traded on an exchange are valued using quoted prices. OTC derivatives, which comprise a majority of derivative contract positions, are valued using valuation techniques such as discounted cash flows or an option pricing model. The fair value for the majority of our derivative instruments are determined based on internally developed models that utilize independently corroborated market parameters, including interest rate yield curves, option volatilities, and currency rates. For complex or long-dated derivative products where market data is not available, fair value may be affected by the underlying assumptions about, among other things, the timing of cash flows, expected exposure, probability of default and recovery rates. The fair values of certain structured derivative products are sensitive to unobservable inputs such as correlations of the referenced variables and volatilities of embedded options. These estimates are susceptible to significant change in future periods as market conditions change.

Significant inputs related to derivative classes are broken down as follows:

•Credit Derivatives – Use credit default curves and recovery rates which are generally provided by broker quotes and various pricing services. Certain credit derivatives may also use correlation inputs in their model valuation.

•Interest Rate Derivatives – Swaps use interest rate curves based on currency that are actively quoted by brokers and other pricing services. Options will also use volatility inputs which are also quoted in the broker market.

•Foreign Exchange ("FX") Derivatives – FX transactions, to the extent possible, use spot and forward FX rates which are quoted in the broker market. Where applicable, we also use implied volatility of currency pairs as inputs.

•Equity Derivatives – Use listed equity security pricing and implied volatilities from equity traded options position.

•Precious Metal Derivatives – Use spot and forward metal rates which are quoted in the broker market.

As discussed earlier, we make fair value adjustments to model valuations in order to ensure that those values represent appropriate estimates of fair value.

Client share repurchase transactions designated under FVO - We elected to apply FVO accounting to certain client share repurchase transactions. The fair value of the assets and liabilities associated with these transactions is determined based on the value of the remaining shares to be delivered.

Structured notes and deposits designated under FVO – Structured notes and deposits are hybrid instruments containing embedded derivatives and are elected to be measured at fair value in their entirety under FVO accounting principles. The valuation of the hybrid instruments is predominantly driven by the derivative features embedded within the instruments and our own credit risk. The valuation of embedded derivatives may include significant unobservable inputs such as correlation of the referenced credit names or volatility of the embedded option. Cash flows of the hybrid instruments in their entirety, including the embedded derivatives, are discounted at an appropriate rate for the applicable duration of the instrument adjusted for our own credit spreads. The credit spreads applied to structured notes are determined with reference to our own debt issuance rates observed in the primary and secondary markets, internal funding rates, and structured note rates in recent executions while the credit spreads applied to structured deposits are determined using market rates currently offered on comparable deposits with similar characteristics and maturities.

Long-term debt designated under FVO – We elected to apply FVO accounting to certain of our own debt issuances, primarily for which fair value hedge accounting otherwise would have been applied. Substantially all of our own debt issuances elected under FVO are traded in secondary markets and, as such, the fair value is determined based on observed prices for the specific instrument. The observed market price of these instruments reflects the effect of our own credit spreads. The credit spreads applied to these instruments were derived from the spreads at the measurement date.

Additional Disclosures About the Fair Value of Financial Instruments that are Not Carried at Fair Value on the Consolidated Balance Sheet The fair value estimates set forth below are made solely to comply with disclosures required by U.S. GAAP and should be read in conjunction with the financial statements and notes included in this report.

The carrying amount of certain financial instruments recorded at cost on the consolidated balance sheet is considered to approximate fair value because they are short-term in nature, bear interest rates that approximate market rates, and generally have negligible credit risk. These items include cash and due from banks, interest bearing deposits with banks, federal funds sold and purchased, securities purchased and sold under resale and repurchase agreements, deposits with no stated maturity (e.g., demand, savings and certain money market deposits), short-term borrowings and dividends payable.

The following table summarizes the carrying value and estimated fair value of our financial instruments, excluding financial instruments that are carried at fair value on a recurring basis, and their classification within the fair value hierarchy:

December 31, 2025	Carrying Value		Fair Value		Level 1		Level 2		Level 3
	(in billions)
Financial assets:
Short-term financial assets, net of allowance for credit losses	$	23.9	$	23.9	$	.8	$	23.1	$	—
Federal funds sold and securities purchased under agreements to resell	9.3		9.3		—		9.3		—
Securities held-to-maturity, net of allowance for credit losses	18.3		18.1		2.8		15.3		—
Commercial loans, net of allowance for credit losses	38.9		39.7		—		—		39.7
Commercial loans held for sale	1.3		1.3		—		1.3		—
Consumer loans, net of allowance for credit losses	20.5		19.8		—		—		19.8
Financial liabilities:
Short-term financial liabilities	$	7.3	$	7.3	$	—	$	7.3	$	—
Deposits	120.5		120.5		—		120.5		—
Long-term debt	14.8		15.1		—		15.1		—

December 31, 2024	Carrying Value		Fair Value		Level 1		Level 2		Level 3
	(in billions)
Financial assets:
Short-term financial assets, net of allowance for credit losses	$	23.2	$	23.2	$	.6	$	22.6	$	—
Federal funds sold and securities purchased under agreements to resell	14.3		14.3		—		14.3		—
Securities held-to-maturity, net of allowance for credit losses	17.8		17.0		2.7		14.3		—
Commercial loans, net of allowance for credit losses	40.5		41.6		—		—		41.6
Consumer loans, net of allowance for credit losses	21.7		19.4		—		—		19.4
Financial liabilities:
Short-term financial liabilities	$	7.4	$	7.4	$	—	$	7.4	$	—
Deposits	119.4		119.4		—		119.4		—
Long-term debt	12.8		13.3		—		13.3		—

Lending-related commitments - The fair value of loan commitments, revolving credit facilities and standby letters of credit are not included in the above table. The majority of the lending-related commitments are not carried at fair value on a recurring basis nor are they actively traded. These instruments generate fees, which approximate those currently charged to originate similar commitments, which are recognized over the term of the commitment period. Deferred fees on loan commitments, revolving credit facilities and standby letters of credit totaled $205 million and $168 million at December 31, 2025 and 2024, respectively.