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Loans and Allowance for Credit Losses: Loans and Unfunded Credit Commitments
 9 Months Ended
Sep. 30, 2022
Receivables [Abstract]  
Loans and Allowance for Credit Losses: Loans and Unfunded Credit Commitments Loans and Allowance for Credit Losses: Loans and Unfunded Credit Commitments
We serve a variety of commercial clients in the private equity/venture capital, technology, life science/healthcare, premium wine and commercial real estate industries. Loans made to private equity/venture capital firm clients typically enable them to fund investments prior to their receipt of funds from capital calls and are reported under the Global Fund Banking class of financing receivable below. Our technology clients generally tend to be in the industries of hardware (such as semiconductors, communications, data, storage and electronics), software/internet (such as infrastructure software, applications, software services, digital content and advertising technology) and ERI. Our life science/healthcare clients primarily tend to be in the industries of biotechnology, medical devices, healthcare information technology and healthcare services. Loans to our technology and life science/healthcare clients are reported under the Investor Dependent, Cash Flow Dependent - SLBO and Innovation C&I classes of financing receivable below. We also make commercial and industrial loans, such as working capital lines and term loans for equipment and fixed assets, to clients that are not in the technology and life science/healthcare industries which are reported in the Other C&I class of financing receivable below. Loans to the premium wine industry focus on vineyards and wineries that produce grapes and wines of high quality. Commercial real estate loans are generally acquisition financing for commercial properties such as office buildings, retail properties, apartment buildings, and industrial/warehouse space, which moving forward, will predominantly support the innovation economy segments. In addition to commercial loans, we make consumer loans through SVB Private and provide real estate secured loans to eligible employees through our EHOP.
We also provide community development loans made as part of our responsibilities under the CRA. The majority of these loans are included within the Other loan class below and are primarily secured by real estate. Additionally, beginning in April 2020, we accepted applications under the PPP administered by the SBA under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") and originated loans to qualified small businesses. PPP funds under the CARES Act were disbursed throughout 2020 and up to June 30, 2021.
Loan Portfolio Segments and Classes of Financing Receivables
The composition of loans at amortized cost basis broken out by class of financing receivable at September 30, 2022 and December 31, 2021 is presented in the following table:
(Dollars in millions)September 30, 2022December 31, 2021
Global fund banking$40,337 $37,958 
Investor dependent:
Early stage1,911 1,593 
Growth stage4,398 3,951 
Total investor dependent6,309 5,544 
Cash flow dependent - SLBO1,845 1,798 
Innovation C&I8,321 6,673 
Private bank10,102 8,743 
CRE2,609 2,670 
Premium wine1,117 985 
Other C&I1,087 1,257 
Other374 317 
PPP28 331 
Total loans (1) (2) (3)$72,129 $66,276 
ACL(557)(422)
Net loans$71,572 $65,854 
(1)    Total loans at amortized cost is net of unearned income, deferred fees and costs, and net unamortized premiums and discounts of $244 million and $250 million at September 30, 2022 and December 31, 2021, respectively.
(2)     Included within our total loan portfolio are credit card loans of $582 million and $583 million at September 30, 2022 and December 31, 2021, respectively.
(3)     Included within our total loan portfolio are construction loans of $454 million and $367 million at September 30, 2022 and December 31, 2021, respectively.
Credit Quality Indicators
For each individual client, we establish an internal credit risk rating for that loan, which is used for assessing and monitoring credit risk as well as performance of the loan and the overall portfolio. Our internal credit risk ratings are also used to summarize the risk of loss due to failure by an individual borrower to repay the loan. For our internal credit risk ratings, each individual loan is given a risk rating of 1 through 10. Loans risk-rated 1 through 4 are performing loans and translate to an internal rating of “Pass,” with loans risk-rated 1 being cash secured. Loans risk-rated 5 through 7 are performing loans; however, we consider them as demonstrating higher risk, which requires more frequent review of the individual exposures; these translate to an internal rating of “Criticized.” All of our nonaccrual loans are risk-rated 8 or 9 and are classified with the internal rating of "Nonperforming." Loans rated 10 are charged-off and are not included as part of our loan portfolio balance. We review our credit quality indicators on a quarterly basis for performance and appropriateness of risk ratings as part of our evaluation process for our ACL for loans.
The following tables summarize the credit quality indicators, broken out by class of financing receivable and vintage year, as of September 30, 2022 and December 31, 2021:

Term Loans by Origination Year
September 30, 2022 (Dollars in millions)20222021202020192018PriorRevolving LoansRevolving Loans Converted to Term LoansUnallocated (1)Total
Global fund banking:
Risk rating:
Pass $512 $95 $63 $31 $1 $10 $39,616 $— $— $40,328 
Criticized— — — — — — 9 — — 9 
Nonperforming— — — — — — — — — — 
Total global fund banking$512 $95 $63 $31 $1 $10 $39,625 $— $— $40,337 
Investor dependent:
Early stage:
Risk rating:
Pass $727 $626 $73 $36 $2 $1 $191 $— $— $1,656 
Criticized67 122 27 7 — 2 26 — — 251 
Nonperforming1 1 — — — — 2 — — 4 
Total early stage$795 $749 $100 $43 $2 $3 $219 $— $— $1,911 
Term Loans by Origination Year
September 30, 2022 (Dollars in millions)20222021202020192018PriorRevolving LoansRevolving Loans Converted to Term LoansUnallocated (1)Total
Growth stage:
Risk rating:
Pass $1,684 $1,456 $360 $72 $28 $6 $243 $5 $— $3,854 
Criticized147 233 53 14 5 — 49 — — 501 
Nonperforming19 18 2 — — — 4 — — 43 
Total growth stage$1,850 $1,707 $415 $86 $33 $6 $296 $5 $— $4,398 
Total investor dependent$2,645 $2,456 $515 $129 $35 $9 $515 $5 $— $6,309 
Cash flow dependent - SLBO:
Risk rating:
Pass $678 $609 $199 $203 $14 $39 $30 $— $— $1,772 
Criticized20 — 16 2 1 22 5 — — 66 
Nonperforming— — — — 5 — 2 — — 7 
Total cash flow dependent - SLBO$698 $609 $215 $205 $20 $61 $37 $— $— $1,845 
Innovation C&I
Risk rating:
Pass $1,788 $1,734 $773 $166 $18 $54 $3,102 $— $— $7,635 
Criticized49 148 121 32 11 — 324 — — 685 
Nonperforming— — — — — — 1 — — 1 
Total innovation C&I$1,837 $1,882 $894 $198 $29 $54 $3,427 $— $— $8,321 
Private bank:
Risk rating:
Pass $2,210 $2,817 $1,753 $948 $441 $1,054 $818 $5 $— $10,046 
Criticized— 16 — 2 — 15 10 — — 43 
Nonperforming— — 1 2 1 8 1 — — 13 
Total private bank$2,210 $2,833 $1,754 $952 $442 $1,077 $829 $5 $— $10,102 
CRE
Risk rating:
Pass $406 $292 $181 $240 $143 $894 $96 $5 $— $2,257 
Criticized2 4 51 135 24 114 17 — — 347 
Nonperforming— — — 5 — — — — — 5 
Total CRE$408 $296 $232 $380 $167 $1,008 $113 $5 $— $2,609 
Premium wine:
Risk rating:
Pass $255 $213 $91 $137 $47 $144 $156 $34 $— $1,077 
Criticized1 5 — 7 9 9 9 — — 40 
Nonperforming— — — — — — — — — — 
Total premium wine$256 $218 $91 $144 $56 $153 $165 $34 $— $1,117 
Other C&I
Risk rating:
Pass $31 $149 $161 $70 $81 $304 $234 $10 $— $1,040 
Criticized1 — 3 6 3 19 11 1 — 44 
Nonperforming— — 1 — 1 1 — — — 3 
Total other C&I$32 $149 $165 $76 $85 $324 $245 $11 $— $1,087 
Other:
Risk rating:
Pass $25 $151 $172 $30 $— $— $11 $— $(44)$345 
Criticized— 3 17 9 — — — — — 29 
Nonperforming— — — — — — — — — — 
Total other$25 $154 $189 $39 $— $— $11 $— $(44)$374 
PPP:
Risk rating:
Pass $— $16 $3 $— $— $— $— $— $— $19 
Criticized— 3 6 — — — — — — 9 
Nonperforming— — — — — — — — — — 
Total PPP$— $19 $9 $— $— $— $— $— $— $28 
Term Loans by Origination Year
September 30, 2022 (Dollars in millions)20222021202020192018PriorRevolving LoansRevolving Loans Converted to Term LoansUnallocated (1)Total
Total loans$8,623 $8,711 $4,127 $2,154 $835 $2,696 $44,967 $60 $(44)$72,129 
(1)    These amounts consist of fees and clearing items that have not yet been allocated at the loan level.
Term Loans by Origination Year
December 31, 2021 (Dollars in millions)20212020201920182017PriorRevolving LoansRevolving Loans Converted to Term LoansUnallocated (1)Total
Global fund banking:
Risk rating:
Pass $764 $115 $36 $6 $8 $4 $36,955 $— $— $37,888 
Criticized50 18 — — — 1 1 — — 70 
Nonperforming— — — — — — — — — — 
Total global fund banking$814 $133 $36 $6 $8 $5 $36,956 $— $— $37,958 
Investor dependent:
Early stage:
Risk rating:
Pass $754 $287 $122 $26 $6 $1 $171 $— $— $1,367 
Criticized64 87 30 5 — — 29 — — 215 
Nonperforming2 5 3 — — — 1 — — 11 
Total early stage$820 $379 $155 $31 $6 $1 $201 $— $— $1,593 
Growth stage:
Risk rating:
Pass $2,072 $910 $265 $78 $14 $1 $286 $5 $— $3,631 
Criticized159 85 27 6 3 — 34 — — 314 
Nonperforming2 — 1 2 — — 1 — — 6 
Total growth stage$2,233 $995 $293 $86 $17 $1 $321 $5 $— $3,951 
Total investor dependent$3,053 $1,374 $448 $117 $23 $2 $522 $5 $— $5,544 
Cash flow dependent - SLBO:
Risk rating:
Pass $875 $384 $252 $72 $76 $2 $35 $— $— $1,696 
Criticized— — 20 25 — 13 10 — — 68 
Nonperforming— — 12 10 7 — 5 — — 34 
Total cash flow dependent - SLBO$875 $384 $284 $107 $83 $15 $50 $— $— $1,798 
Innovation C&I:
Risk rating:
Pass $2,230 $1,058 $288 $123 $58 $— $2,411 $— $— $6,168 
Criticized64 130 62 12 — — 236 — — 504 
Nonperforming— — — — — — 1 — — 1 
Total Innovation C&I$2,294 $1,188 $350 $135 $58 $— $2,648 $— $— $6,673 
Private bank:
Risk rating:
Pass $2,952 $2,015 $1,122 $520 $432 $952 $705 $8 $— $8,706 
Criticized— — 2 — 2 9 3 — — 16 
Nonperforming— — 2 9 — 8 2 — — 21 
Total private bank$2,952 $2,015 $1,126 $529 $434 $969 $710 $8 $— $8,743 
CRE
Risk rating:
Pass$326 $215 $344 $155 $236 $868 $110 $2 $— $2,256 
Criticized3 39 114 37 47 139 18 12 — 409 
Nonperforming— — 5 — — — — — — 5 
Total CRE$329 $254 $463 $192 $283 $1,007 $128 $14 $— $2,670 
Premium wine:
Risk rating:
Pass $217 $112 $156 $69 $71 $162 $125 $34 $— $946 
Criticized1 7 11 9 — — 11 — — 39 
Nonperforming— — — — — — — — — — 
Total Premium wine$218 $119 $167 $78 $71 $162 $136 $34 $— $985 
Other C&I
Risk rating:
Pass$181 $175 $82 $86 $28 $301 $350 $11 $— $1,214 
Criticized5 6 6 7 2 — 8 5 — 39 
Nonperforming— — — 2 — 1 1 — — 4 
Total other C&I$186 $181 $88 $95 $30 $302 $359 $16 $— $1,257 
Other:
Term Loans by Origination Year
December 31, 2021 (Dollars in millions)20212020201920182017PriorRevolving LoansRevolving Loans Converted to Term LoansUnallocated (1)Total
Risk rating:
Pass $61 $144 $82 $20 $14 $— $7 $— $(21)$307 
Criticized— 7 1 — 2 — — — — 10 
Nonperforming— — — — — — — — — — 
Total other$61 $151 $83 $20 $16 $— $7 $— $(21)$317 
PPP:
Risk rating:
Pass $226 $72 $— $— $— $— $— $— $— $298 
Criticized22 9 — — — — — — — 31 
Nonperforming2 — — — — — — — — 2 
Total PPP$250 $81 $— $— $— $— $— $— $— $331 
Total loans$11,032 $5,880 $3,045 $1,279 $1,006 $2,462 $41,516 $77 $(21)$66,276 
Allowance for Credit Losses: Loans
In the third quarter of 2022, the ACL for loans increased by $12 million, driven primarily by loan growth and the continued deterioration in projected economic conditions.
The Moody's Analytics September 2022 forecast was utilized in our quantitative model for the ACL as of September 30, 2022. The forecast assumptions included a significantly worse housing price index growth rate than that of last quarter, as well as a lower gross domestic product growth rate. The forecast's starting unemployment rate was unchanged from prior quarter, but it is worse in future quarters than in previous projections. The overall impact of these assumptions was a worse forecast than that used at June 30, 2022.
Additionally, we reduced the weighting applied to the Moody's downside economic scenario to reflect that the September forecasts more closely aligned with our expectations as of September 30, 2022, thereby no longer requiring a downside weighting as significant as in the previous quarter. To the extent we identified credit risk considerations that were not captured by the Moody's Analytics September 2022 forecast, we addressed the risk through management's adjustments to the scenario weightings. After adjusting the weightings accordingly, we determined the forecast to be representative of our outlook for the economy given the available information at current quarter end.
We do not estimate expected credit losses on AIR on loans, as AIR is reversed or written off when the full collection of the AIR related to a loan becomes doubtful. AIR on loans totaled $294 million at September 30, 2022 and $171 million at December 31, 2021 and is reported in "Accrued interest receivable and other assets" in our unaudited interim consolidated balance sheets.
The following tables summarize the activity relating to our ACL for loans for the three and nine months ended September 30, 2022 and 2021, broken out by portfolio segment:
Three months ended September 30, 2022Beginning Balance June 30, 2022Charge-offsRecoveries Provision (Reduction) for Credit Loss for LoansForeign Currency Translation AdjustmentsEnding Balance September 30, 2022
(Dollars in millions)
Global fund banking$89 $— $6 $(4)$— $91 
Investor dependent224 (20)4 25 1 234 
Cash flow dependent and innovation C&I130 (5)— 11 — 136 
Private bank45 — — 2 — 47 
CRE34 — — (7)— 27 
Other C&I12 (1)1 — — 12 
Premium wine and other11 — — 3 (4)10 
Total ACL$545 $(26)$11 $30 $(3)$557 
Three months ended September 30, 2021Beginning Balance June 30, 2021Initial
Allowance
on PCD
Loans		Charge-offsRecoveries Provision (Reduction) for Credit Loss for LoansEnding Balance September 30, 2021
(Dollars in millions)
Global fund banking$66 $— $— $— $(7)$59 
Investor dependent158 — (17)5 (8)138 
Cash flow dependent and innovation C&I119 — (1)3 (12)109 
Private bank47 1 (1)— (16)31 
CRE— 17 — — 23 40 
Other C&I— 4 — — 8 12 
Premium wine and other6 — — — 3 9 
Total ACL$396 $22 $(19)$8 $(9)$398 
Nine months ended September 30, 2022Beginning Balance December 31, 2021Charge-offsRecoveriesProvision (Reduction) for Credit Loss for LoansForeign Currency Translation AdjustmentsEnding Balance September 30, 2022
(Dollars in millions)
Global fund banking$67 $— $6 $18 $— $91 
Investor dependent146 (53)13 126 2 234 
Cash flow dependent and innovation C&I118 (9)— 27 — 136 
Private Bank33 — 2 12 — 47 
CRE36 — — (9)— 27 
Other C&I14 (3)1 — — 12 
Premium wine and other8 (1)1 10 (8)10 
Total ACL$422 $(66)$23 $184 $(6)$557 
Nine months ended September 30, 2021Beginning Balance December 31, 2020Initial Allowance on PCD LoansCharge-offsRecoveriesProvision (Reduction) for Credit Loss for LoansEnding Balance September 30, 2021
(Dollars in millions)
Global fund banking$46 $— $(80)$— $93 $59 
Investor dependent213 — (37)13 (51)138 
Cash flow dependent and innovation C&I125 — (8)3 (11)109 
Private Bank53 1 (3)— (20)31 
CRE— 17 — — 23 40 
Other C&I— 4 — — 8 12 
Premium wine and other9 — (1)— 1 9 
PPP2 — — — (2)— 
Total ACL$448 $22 $(129)$16 $41 $398 
The following table summarizes the aging of our loans broken out by class of financing receivable as of September 30, 2022 and December 31, 2021:
(Dollars in millions)30 - 59
  Days Past  
Due		60 - 89
  Days Past  
Due		Equal to or Greater
Than 90
  Days Past  
Due		  Total Past  
Due		Current  Total   Loans Past Due
90 Days or
More Still
Accruing
Interest
September 30, 2022:
Global fund banking$— $— $— $— $40,337 $40,337 $— 
Investor dependent:
Early stage2 2 1 5 1,906 1,911 — 
Growth stage26 13 2 41 4,357 4,398 — 
Total investor dependent28 15 3 46 6,263 6,309 — 
Cash flow dependent - SLBO4 — — 4 1,841 1,845 — 
Innovation C&I6 3 — 9 8,312 8,321 — 
Private bank1 12 5 18 10,084 10,102 1 
CRE1 7 5 13 2,596 2,609 — 
Premium wine3 — — 3 1,114 1,117 — 
Other C&I— 3 — 3 1,084 1,087 — 
Other— — — — 374 374 — 
PPP— — 6 6 22 28 5 
Total loans$43 $40 $19 $102 $72,027 $72,129 $6 
December 31, 2021:
Global fund banking$— $— $— $— $37,958 $37,958 $— 
Investor dependent:
Early stage6 5 — 11 1,582 1,593 — 
Growth stage16 — — 16 3,935 3,951 — 
Total investor dependent22 5 — 27 5,517 5,544 — 
Cash flow dependent - SLBO— — — — 1,798 1,798 — 
Innovation C&I7 — 7 14 6,659 6,673 7 
Private bank28 1 12 41 8,702 8,743 — 
CRE1 — — 1 2,669 2,670 — 
Premium wine3 — — 3 982 985 — 
Other C&I1 2 1 4 1,253 1,257 — 
Other— — — — 317 317 — 
PPP1 — — 1 330 331 — 
Total loans$63 $8 $20 $91 $66,185 $66,276 $7 
Nonaccrual Loans
The following table summarizes our nonaccrual loans with no allowance for credit loss at September 30, 2022 and December 31, 2021:
September 30, 2022December 31, 2021
(Dollars in millions)Nonaccrual LoansNonaccrual Loans with no Allowance for Credit LossNonaccrual Loans Nonaccrual Loans with no Allowance for Credit Loss
Investor dependent:
Early stage$4 $— $11 $— 
Growth stage43 1 6 — 
Total investor dependent47 1 17 — 
Cash flow dependent - SLBO7 — 34 — 
Innovation C&I1 — 1 1 
Private bank13 6 21 8 
CRE5 — 5 — 
Other C&I3 — 4 — 
PPP— — 2 — 
Total nonaccrual loans$76 $7 $84 $9 
TDRs
As of September 30, 2022, we had 39 TDRs with a total carrying value of $85 million where concessions have been granted to borrowers experiencing financial difficulties, in an attempt to maximize collection. We had no unfunded commitments available for funding to the clients associated with these TDRs as of September 30, 2022.
The following table summarizes our loans modified in TDRs, broken out by class of financing receivable at September 30, 2022 and December 31, 2021:
(Dollars in millions)September 30, 2022December 31, 2021
Loans modified in TDRs:
Investor dependent:
Early stage$1 $12 
Growth stage32 3 
Total investor dependent33 15 
Cash flow dependent - SLBO8 34 
Innovation C&I1 — 
Private bank8 12 
CRE33 33 
Other C&I2 2 
Total loans modified in TDRs$85 $96 
The following table summarizes the recorded investment in loans modified in TDRs, broken out by class of financing receivable, for modifications made during the three and nine months ended September 30, 2022 and 2021:
 Three months ended September 30, Nine months ended September 30,
(Dollars in millions)2022202120222021
Loans modified in TDRs during the period:
Investor dependent:
Early stage$1 $— $1 $1 
Growth stage12 8 32 8 
Total investor dependent13 8 33 9 
Cash flow dependent - SLBO— — — 12 
Innovation C&I1 — 1 — 
Private bank— 2 1 2 
CRE5 43 5 43 
Total loans modified in TDRs during the period (1)$19 $53 $40 $66 
(1)There were $4 million of partial charge-offs for the three months ended September 30, 2022 and $9 million of partial charge-offs for the nine months then ended. There were no partial charge-offs for the three months ended September 30, 2021 and $7 million of partial charge-offs for the nine months then ended.

During the three months ended September 30, 2022, new TDRs of $19 million were modified through payment deferrals granted to our clients. During the three months ended September 30, 2021, new TDRs of $17 million were modified through payment deferrals granted to our clients, $14 million were modified through term extensions and $22 million were modified through a combination thereof.
During the nine months ended September 30, 2022, new TDRs of $38 million were modified through payment deferrals granted to our clients, $1 million were modified through rate reductions and $1 million were modified through settlement. During the nine months ended September 30, 2021, new TDRs of $30 million were modified through payment deferrals granted to our clients, $14 million were modified through term extensions and $22 million were modified through a combination thereof.
Of loans modified in TDRs within the previous 12 months, $1 million in Investor Dependent - Early Stage defaulted on the modified terms during the three and nine months ended September 30, 2022. There were no defaults of loans modified in TDRs during the three and nine months ended September 30, 2021.
Charge-offs and defaults on previously restructured loans are evaluated to determine the impact to the ACL for loans, if any. The evaluation of these defaults may impact the assumptions used in calculating the reserve on other TDRs and nonaccrual loans as well as management’s overall outlook of macroeconomic factors that affect the reserve on the loan portfolio as a whole. After evaluating the charge-offs and defaults experienced on our TDRs, we determined that no change to our reserving methodology for TDRs was necessary to determine the ACL for loans as of September 30, 2022.
ACL: Unfunded Credit Commitments
We maintain a separate ACL for unfunded credit commitments that is determined using a methodology that is inherently similar to the methodology used for calculating the ACL for loans. At September 30, 2022, our ACL estimates utilized the Moody's economic forecasts from September 30, 2022 as mentioned above. In the third quarter of 2022, the ACL for unfunded commitments increased by $41 million from the prior quarter, driven primarily by continued growth in our outstanding commitments, as well as the same deterioration in projected economic conditions described above.
The following table summarizes the activity relating to our ACL for unfunded credit commitments for the three and nine months ended September 30, 2022 and 2021:
 Three months ended September 30, Nine months ended September 30,
(Dollars in millions)2022202120222021
ACL: unfunded credit commitments, beginning balance$224 $120 171 $121 
Provision for (reduction in) credit losses42 29 96 28 
Foreign currency translation adjustments(1)— (2)— 
ACL: unfunded credit commitments, ending balance (1)$265 $149 $265 $149 
(1)The “ACL: unfunded credit commitments” is included as a component of “other liabilities” on our unaudited interim consolidated balance sheets. See Note 11 — “Off-Balance Sheet Arrangements, Guarantees and Other Commitments” of this report for additional disclosures related to our commitments to extend credit.