Note 18: Revenue from Contracts with Customers

Our revenue includes net interest income on financial instruments and noninterest income. Table 18.1 presents our revenue by operating segment. The “Other” segment for each of the tables below includes the elimination of certain items that are included in more than one business segment, substantially all of which represents products and services for WIM customers served through Community Banking distribution channels. For additional description of our operating segments, including additional financial information and the underlying management accounting process, see Note 22 (Operating Segments).

We adopted ASU 2014-09 – Revenue from Contracts with Customers on a modified retrospective basis as of January 1, 2018. For details on the impact of the adoption of this ASU, see Note 1 (Summary of Significant Accounting Policies) to Financial Statements in our 2018 Form 10-K.

Table 18.1: Revenue by Operating Segment



	Quarter ended Mar 31,
	Community Banking					Wholesale Banking			Wealth and Investment Management				Other (3)				Consolidated Company
(in millions)	2019			2018		2019		2018	2019		2018		2019		2018		2019	2018
Net interest income (1)	$	7,248		7,195		4,534		4,532	1,101		1,112		(572	)	(601	)	12,311	12,238
Noninterest income:
Service charges on deposit accounts	610			639		483		534	4		4		(3	)	(4	)	1,094	1,173
Trust and investment fees:
Brokerage advisory, commissions and other fees	449			478		78		67	2,124		2,344		(458	)	(486	)	2,193	2,403
Trust and investment management	210			233		114		113	676		743		(214	)	(239	)	786	850
Investment banking	(20		)	(10	)	412		440	5		—		(3	)	—		394	430
Total trust and investment fees	639			701		604		620	2,805		3,087		(675	)	(725	)	3,373	3,683
Card fees	858			821		86		87	1		1		(1	)	(1	)	944	908
Other fees:
Lending related charges and fees (1)(2)	65			76		282		304	2		2		(2	)	(2	)	347	380
Cash network fees	109			125		—		1	—		—		—		—		109	126
Commercial real estate brokerage commissions	—			—		81		85	—		—		—		—		81	85
Wire transfer and other remittance fees	64			63		48		52	2		2		(1	)	(1	)	113	116
All other fees (1)	94			63		26		30	—		—		—		—		120	93
Total other fees	332			327		437		472	4		4		(3	)	(3	)	770	800
Mortgage banking (1)	641			842		68		93	(3	)	(3	)	2		2		708	934
Insurance (1)	11			28		78		79	17		18		(10	)	(11	)	96	114
Net gains (losses) from trading activities (1)	5			(1	)	333		225	19		19		—		—		357	243
Net gains on debt securities (1)	37			—		88		1	—		—		—		—		125	1
Net gains from equity securities (1)	601			684		77		93	136		6		—		—		814	783
Lease income (1)	—			—		443		455	—		—		—		—		443	455
Other income of the segment (1)	768			594		(120	)	88	(5	)	(6	)	(69	)	(74	)	574	602
Total noninterest income	4,502			4,635		2,577		2,747	2,978		3,130		(759	)	(816	)	9,298	9,696
Revenue	$	11,750		11,830		7,111		7,279	4,079		4,242		(1,331	)	(1,417	)	21,609	21,934


(1)	Most of our revenue is not within the scope of Accounting Standards Update (ASU) 2014-09 – Revenue from Contracts with Customers, and additional details are included in other footnotes to our financial statements. The scope explicitly excludes net interest income as well as many other revenues for financial assets and liabilities, including loans, leases, securities, and derivatives.


(2)	Represents combined amount of previously reported “Charges and fees on loans” and “Letters of credit fees”.


(3)	Includes the elimination of certain items that are included in more than one business segment, substantially all of which represents products and services for WIM customers served through Community Banking distribution channels.

We provide services to customers which have related performance obligations that we complete to recognize revenue. Our revenues are generally recognized either immediately upon the completion of our service or over time as we perform services. Any services performed over time generally require that we render services each period and therefore we measure our progress in completing these services based upon the passage of time.

SERVICE CHARGES ON DEPOSIT ACCOUNTS are earned on depository accounts for commercial and consumer customers and include fees for account and overdraft services. Account charges include fees for periodic account maintenance activities and event-driven services such as stop payment fees. Our obligation for event-driven services is satisfied at the time of the event when the service is delivered, while our obligation for maintenance services is satisfied over the course of each month. Our obligation for overdraft services is satisfied at the time of the overdraft.

Table 18.2 presents our service charges on deposit accounts by operating segment.

Table 18.2: Service Charges on Deposit Accounts by Operating Segment



	Quarter ended Mar 31,
	Community Banking			Wholesale Banking		Wealth and Investment Management		Other				Consolidated Company
(in millions)	2019		2018	2019	2018	2019	2018	2019		2018		2019	2018
Overdraft fees	$	417	412	1	2	—	—	—		—		418	414
Account charges	193		227	482	532	4	4	(3	)	(4	)	676	759
Service charges on deposit accounts	$	610	639	483	534	4	4	(3	)	(4	)	1,094	1,173

BROKERAGE ADVISORY, COMMISSIONS AND OTHER FEES are earned for providing full-service and discount brokerage services predominantly to retail brokerage clients. These revenues include fees earned on asset-based and transactional accounts and other brokerage advisory services.

Asset-based revenues are charged based on the market value of the client’s assets. The services and related obligations associated with certain of these revenues, which include investment advice, active management of client assets, or assistance with selecting and engaging a third-party advisory manager, are generally satisfied over a month or quarter. The remaining revenues include trailing commissions which are earned for selling shares to investors. Our obligation associated with earning trailing commissions is satisfied at the time shares are sold. However, these fees are received and recognized over time during the period the customer owns the shares and we remain the broker of record. The amount of trailing commissions is variable based on the length of time the customer holds the shares and on changes in the value of the underlying assets.

Transactional revenues are earned for executing transactions at the client’s direction. Our obligation is generally satisfied upon the execution of the transaction and the fees are based on the size and number of transactions executed.

Other revenues earned from other brokerage advisory services include omnibus and networking fees received from mutual fund companies in return for providing record keeping and other administrative services, and annual account maintenance fees charged to customers.

Table 18.3 presents our brokerage advisory, commissions and other fees by operating segment.

Table 18.3: Brokerage Advisory, Commissions and Other Fees by Operating Segment



	Quarter ended Mar 31,
	Community Banking			Wholesale Banking		Wealth and Investment Management		Other				Consolidated Company
(in millions)	2019		2018	2019	2018	2019	2018	2019		2018		2019	2018
Asset-based revenue (1)	$	343	371	—	—	1,580	1,743	(343	)	(371	)	1,580	1,743
Transactional revenue	89		93	16	12	387	439	(98	)	(100	)	394	444
Other revenue	17		14	62	55	157	162	(17	)	(15	)	219	216
Brokerage advisory, commissions and other fees	$	449	478	78	67	2,124	2,344	(458	)	(486	)	2,193	2,403


(1)	We earned trailing commissions of $280 million and $331 million in first quarter 2019 and 2018, respectively.

TRUST AND INVESTMENT MANAGEMENT FEES are earned for providing trust, investment management and other related services.

Investment management services include managing and administering assets, including mutual funds, and institutional separate accounts. Fees for these services are generally determined based on a tiered scale relative to the market value of assets under management (AUM). In addition to AUM, we have client assets under administration (AUA) that earn various administrative fees which are generally based on the extent of the services provided to administer the account. Services with AUM and AUA-based fees are generally performed over time.

Trust services include acting as a trustee or agent for corporate trust, personal trust, and agency assets. Obligations for trust services are generally satisfied over time, while obligations for activities that are transactional in nature are satisfied at the time of the transaction.

Other related services include the custody and safekeeping of accounts. Our obligation for these services is generally satisfied over time.

Table 18.4 presents our trust and investment management fees by operating segment.

Table 18.4: Trust and Investment Management Fees by Operating Segment



	Quarter ended Mar 31,
	Community Banking			Wholesale Banking		Wealth and Investment Management		Other				Consolidated Company
(in millions)	2019		2018	2019	2018	2019	2018	2019		2018		2019	2018
Investment management fees	$	1	—	—	—	477	534	—		—		478	534
Trust fees	209		221	82	86	168	188	(214	)	(239	)	245	256
Other revenue	—		12	32	27	31	21	—		—		63	60
Trust and investment management fees	$	210	233	114	113	676	743	(214	)	(239	)	786	850

INVESTMENT BANKING FEES are earned for underwriting debt and equity securities, arranging loan syndications and performing other advisory services. Our obligation for these services is generally satisfied at closing of the transaction. Substantially all of these fees are in the Wholesale Banking operating segment.

CARD FEES include credit and debit card interchange and network revenues and various card-related fees. Credit and debit card interchange and network revenues are earned on credit and debit card transactions conducted through payment networks such as Visa, MasterCard, and American Express. Our obligation is satisfied concurrently with the delivery of services on a daily basis.

Table 18.5 presents our card fees by operating segment.

Table 18.5: Card Fees by Operating Segment



	Quarter ended Mar 31,
	Community Banking			Wholesale Banking		Wealth and Investment Management		Other				Consolidated Company
(in millions)	2019		2018	2019	2018	2019	2018	2019		2018		2019	2018
Credit card interchange and network revenues (1)	$	189	171	86	87	1	1	(1	)	(1	)	275	258
Debit card interchange and network revenues	507		479	—	—	—	—	—		—		507	479
Late fees, cash advance fees, balance transfer fees, and annual fees	162		171	—	—	—	—	—		—		162	171
Card fees (1)	$	858	821	86	87	1	1	(1	)	(1	)	944	908


(1)	The cost of credit card rewards and rebates of $354 million and $343 million for the quarters ended March 31, 2019 and 2018, respectively, are presented net against the related revenues.

CASH NETWORK FEES are earned for processing ATM transactions. Our obligation is completed daily upon settlement of ATM transactions. All of these fees are in the Community Banking operating segment.

COMMERCIAL REAL ESTATE BROKERAGE COMMISSIONS are earned for assisting customers in the sale of real estate property. Our obligation is satisfied upon the successful brokering of a transaction. Fees are based on a fixed percentage of the sales price. All of these fees are in the Wholesale Banking operating segment.

WIRE TRANSFER AND OTHER REMITTANCE FEES consist of fees earned for funds transfer services and issuing cashier’s checks and money orders. Our obligation is satisfied at the time of the funds transfer services or upon issuance of the cashier’s check or money order. Substantially all of these fees are in the Community Banking and Wholesale Banking operating segments.

ALL OTHER FEES include various types of fees earned on services to customers which have related performance obligations that we complete to recognize revenue. A majority portion of the revenue is earned from providing business payroll services and merchant services, which are generally recognized over time as we perform the services. Most of these fees are in the Community Banking operating segment.