Basis of Presentation and Accounting Policies Basis of Presentation and Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2021

Defined Benefit Pension and Other Postretirement Costs

Effective January 1, 2021, the Corporation elected to change the accounting methodology for determining the market-related value of assets (MRVA) for certain classes of assets in the qualified defined benefit pension plan. The MRVA is used to calculate the Corporation's expected return on plan assets, a component of defined pension benefit cost (credit). These classes are currently comprised of the fixed income securities and private placement assets held in the portfolio, utilized by the Corporation to mitigate the impacts to financial results from changes in fair value of the pension liability. Previously, MRVA was measured using a historical five-year average fair value. Under the new methodology, the Corporation calculates MRVA using fair value of plan assets. Although both methods are permitted under U.S. GAAP, the Corporation believes the new policy is preferable for these classes of assets as it results in more timely recognition of the performance of pension assets in the results from operations.

The change in accounting methodology is applied retrospectively to all prior periods presented in the consolidated financial statements. The impact of the change to the qualified defined benefit plan on the Corporation's consolidated financial statements is as follows:

Consolidated Balance Sheets


	June 30, 2021		December 31, 2020
(in millions)	Accounting Change Impact		Previously Reported		Accounting Change Impact		Recast Amounts
Accumulated other comprehensive (loss) income	$	(7)	$	168	$	(104)	$	64
Retained earnings	7		9,623		104		9,727

Consolidated Statements of Comprehensive Income


	Three Months Ended June 30,
	2021		2020
(in millions)	Accounting Change Impact		Previously Reported		Accounting Change Impact		Recast Amounts
Other noninterest expenses	$	(5)	$	25	$	(6)	$	19
Provision for income taxes	$	1	27		1		28
Net income	4		113		5		118

Earnings per common share:
Basic	$	0.03	$	0.81	$	0.04	$	0.85
Diluted	$	0.03	$	0.80	$	0.04	$	0.84


	Six Months Ended June 30,
	2021		2020
(in millions)	Accounting Change Impact		Previously Reported		Accounting Change Impact		Recast Amounts
Other noninterest expenses	$	(9)	$	50	$	(14)	$	36
Provision for income taxes	2		6		3		9
Net income	7		48		11		59

Earnings per common share:
Basic	$	0.05	$	0.34	$	0.08	$	0.42
Diluted	$	0.05	$	0.34	$	0.08	$	0.42

Consolidated Statements of Cash Flows


	Six Months Ended June 30,
	2021		2020
(in millions)	Accounting Change Impact		Previously Reported		Accounting Change Impact		Recast Amounts
Net income	$	7	$	48	$	11	$	59
Provision (benefit) for deferred income taxes	2		(95)		3		(92)
Net periodic defined benefit credit	(9)		(13)		(14)		(27)