Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | |||||
For the quarterly period ended June 30, 2023 | |||||
or | |||||
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | ||||||||||
(Address of principle executive offices) | (Zip code) | ||||||||||
(Registrant’s telephone number, including area code) |
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: | ||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Securities registered pursuant to Section 12(g) of the Securities Exchange Act of 1934: | ||||||||
☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company |
CONTENTS | ||||||||||||||
Part One — Financial Information: | ||||||||||||||
Item 1. | ||||||||||||||
Item 2. | ||||||||||||||
Item 3. | ||||||||||||||
Item 4. | ||||||||||||||
Part Two — Other Information: | ||||||||||||||
Item 1. | ||||||||||||||
Item 1A. | ||||||||||||||
Item 2. | ||||||||||||||
Item 5. | ||||||||||||||
Item 6. | ||||||||||||||
Acronym | Definition | Acronym | Definition | ||||||||
ACL | Allowance for Credit Losses | HOA | Home Owner’s Association | ||||||||
AFS | Available for Sale | HQLS | High Quality Liquid Securities | ||||||||
AOCI | Accumulated Other Comprehensive Income | HTM | Held to Maturity | ||||||||
ASC | Accounting Standards Codification | ISDA | International Swaps and Derivatives Association | ||||||||
ASU | Accounting Standards Update | LIBOR | London Inter-Bank Offered Rate | ||||||||
BHC | Bank Holding Company | LGD | Loss Given Default | ||||||||
BOLI | Bank Owned Life Insurance | LOCOM | Lower of the Cost or Market Value | ||||||||
bps | Basis point(s); 1 bp = 0.01% | MD&A | Management’s Discussion and Analysis | ||||||||
C&I | Commercial and Industrial | MSRs | Mortgage Servicing Rights | ||||||||
CAB | Community Association Banking | NCCOB | North Carolina Commissioner of Banks | ||||||||
CCAR | Comprehensive Capital Analysis and Review | NII | Net Interest Income | ||||||||
CECL | Current Expected Credit Losses | NII Sensitivity | Net Interest Income Sensitivity | ||||||||
DPA | Deferred Purchase Agreement | NIM | Net Interest Margin | ||||||||
DTAs | Deferred Tax Assets | OREO | Other Real Estate Owned | ||||||||
EAD | Exposure at Default | PAA | Purchase Accounting Adjustments | ||||||||
ETR | Effective Tax Rate | PCA | Prompt corrective action | ||||||||
EVE Sensitivity | Economic Value of Equity Sensitivity | PCAOB | Public Company Accounting Oversight Board | ||||||||
FASB | Financial Accounting Standards Board | PCD | Purchased Credit Deteriorated | ||||||||
FCB | First-Citizens Bank & Trust Company | PD | Probability of Obligor Default | ||||||||
FDIC | Federal Deposit Insurance Corporation | R&S | Reasonable and Supportable | ||||||||
FHA | Federal Housing Administration | PPP | Paycheck Protection Program | ||||||||
FHC | Financial Holding Company | ROU | Right of Use | ||||||||
FHLB | Federal Home Loan Bank | RSU | Restricted Stock Unit | ||||||||
FOMC | Federal Open Market Committee | SBA | Small Business Administration | ||||||||
FRB | Federal Reserve Bank | SOFR | Secured Overnight Financing Rate | ||||||||
GAAP | Accounting Principles Generally Accepted in the U.S. | TDRs | Troubled Debt Restructuring | ||||||||
GDP | Gross Domestic Product | UPB | Unpaid Principal Balance | ||||||||
HFI | Held for Investment | VIE | Variable Interest Entity | ||||||||
dollars in millions, except share data | June 30, 2023 | December 31, 2022 | |||||||||
Assets | |||||||||||
Cash and due from banks | $ | $ | |||||||||
Interest-earning deposits at banks | |||||||||||
Securities purchased under agreements to resell | |||||||||||
Investment in marketable equity securities (cost of $ | |||||||||||
Investment securities available for sale (cost of $ | |||||||||||
Investment securities held to maturity (fair value of $ | |||||||||||
Assets held for sale | |||||||||||
Loans and leases | |||||||||||
Allowance for credit losses | ( | ( | |||||||||
Loans and leases, net of allowance for credit losses | |||||||||||
Operating lease equipment, net | |||||||||||
Premises and equipment, net | |||||||||||
Goodwill | |||||||||||
Other intangible assets | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities | |||||||||||
Deposits: | |||||||||||
Noninterest-bearing | $ | $ | |||||||||
Interest-bearing | |||||||||||
Total deposits | |||||||||||
Credit balances of factoring clients | |||||||||||
Borrowings: | |||||||||||
Short-term borrowings | |||||||||||
Long-term borrowings | |||||||||||
Total borrowings | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Stockholders’ equity | |||||||||||
Preferred stock - $ | |||||||||||
Common stock: | |||||||||||
Class A - $ | |||||||||||
Class B - $ | |||||||||||
Additional paid in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Total stockholders’ equity | |||||||||||
Total liabilities and stockholders’ equity | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
dollars in millions, except share and per share data | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Interest income | |||||||||||||||||||||||
Interest and fees on loans | $ | $ | $ | $ | |||||||||||||||||||
Interest on investment securities | |||||||||||||||||||||||
Interest on deposits at banks | |||||||||||||||||||||||
Total interest income | |||||||||||||||||||||||
Interest expense | |||||||||||||||||||||||
Deposits | |||||||||||||||||||||||
Borrowings | |||||||||||||||||||||||
Total interest expense | |||||||||||||||||||||||
Net interest income | |||||||||||||||||||||||
Provision for credit losses | |||||||||||||||||||||||
Net interest income after provision for credit losses | |||||||||||||||||||||||
Noninterest income | |||||||||||||||||||||||
Rental income on operating lease equipment | |||||||||||||||||||||||
Fee income and other service charges | |||||||||||||||||||||||
Client investment fees | |||||||||||||||||||||||
Wealth management services | |||||||||||||||||||||||
International fees | |||||||||||||||||||||||
Service charges on deposit accounts | |||||||||||||||||||||||
Factoring commissions | |||||||||||||||||||||||
Cardholder services, net | |||||||||||||||||||||||
Merchant services, net | |||||||||||||||||||||||
Insurance commissions | |||||||||||||||||||||||
Realized loss on sale of investment securities available for sale, net | ( | ||||||||||||||||||||||
Fair value adjustment on marketable equity securities, net | ( | ( | ( | ( | |||||||||||||||||||
Bank-owned life insurance | |||||||||||||||||||||||
Gain on sale of leasing equipment, net | |||||||||||||||||||||||
Gain on acquisition | |||||||||||||||||||||||
Gain on extinguishment of debt | |||||||||||||||||||||||
Other noninterest income | |||||||||||||||||||||||
Total noninterest income | |||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||
Depreciation on operating lease equipment | |||||||||||||||||||||||
Maintenance and other operating lease expenses | |||||||||||||||||||||||
Salaries and benefits | |||||||||||||||||||||||
Net occupancy expense | |||||||||||||||||||||||
Equipment expense | |||||||||||||||||||||||
Professional fees | |||||||||||||||||||||||
Third-party processing fees | |||||||||||||||||||||||
FDIC insurance expense | |||||||||||||||||||||||
Marketing expense | |||||||||||||||||||||||
Acquisition-related expenses | |||||||||||||||||||||||
Intangible asset amortization | |||||||||||||||||||||||
Other noninterest expense | |||||||||||||||||||||||
Total noninterest expense | |||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Preferred stock dividends | |||||||||||||||||||||||
Net income available to common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Earnings per common share | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ | |||||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
dollars in millions | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive loss, net of tax | |||||||||||||||||||||||
Net unrealized loss on securities available for sale | ( | ( | ( | ( | |||||||||||||||||||
Net change in unrealized loss on securities available for sale transferred to securities held to maturity | |||||||||||||||||||||||
Net change in defined benefit pension items | ( | ||||||||||||||||||||||
Other comprehensive loss, net of tax | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Total comprehensive income | $ | $ | $ | $ |
Three Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||
dollars in millions, except share data | Preferred Stock | Class A Common Stock | Class B Common Stock | Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | ||||||||||||||||||||||||||||||||||||||||||||
Class A common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Class B common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends declared: | ||||||||||||||||||||||||||||||||||||||||||||
Series A | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series B | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series C | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ( $ | ||||||||||||||||||||||||||||||||||||||||||||
Class A common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Class B common stock | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends declared | ||||||||||||||||||||||||||||||||||||||||||||
Series A | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series B | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series C | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | $ | $ | $ | $ | $ | ( | $ |
Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||
dollars in millions, except share data | Preferred Stock | Class A Common Stock | Class B Common Stock | Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | ||||||||||||||||||||||||||||||||||||||||||||
Class A common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Class B common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends declared: | ||||||||||||||||||||||||||||||||||||||||||||
Series A | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series B | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series C | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||
Issued in CIT Merger: | ||||||||||||||||||||||||||||||||||||||||||||
Common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Series B preferred stock | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Series C preferred stock | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Cash dividends declared ($ | ||||||||||||||||||||||||||||||||||||||||||||
Class A common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Class B common stock | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends declared | ||||||||||||||||||||||||||||||||||||||||||||
Series A | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series B | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Series C | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | $ | $ | $ | $ | $ | ( | $ |
Six Months Ended June 30, | |||||||||||
dollars in millions | 2023 | 2022 | |||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||||||
Provision for credit losses | |||||||||||
Deferred tax (benefit) expense | ( | ||||||||||
Depreciation, amortization, and accretion, net | |||||||||||
Stock based compensation expense | |||||||||||
Realized loss on sale of investment securities available for sale, net | |||||||||||
Fair value adjustment on marketable equity securities, net | |||||||||||
Loss (gain) on sale of loans, net | ( | ||||||||||
Gain on sale of operating lease equipment, net | ( | ( | |||||||||
Gain on sale of premises and equipment, net | ( | ||||||||||
Gain on other real estate owned, net | ( | ( | |||||||||
Gain on acquisition | ( | ( | |||||||||
Gain on extinguishment of debt | ( | ||||||||||
Origination of loans held for sale | ( | ( | |||||||||
Proceeds from sale of loans held for sale | |||||||||||
Net change in other assets | ( | ||||||||||
Net change in other liabilities | ( | ( | |||||||||
Other operating activities | ( | ( | |||||||||
Net cash provided by operating activities | |||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
Net decrease in interest-earning deposits at banks | |||||||||||
Purchases of investment securities available for sale | ( | ( | |||||||||
Proceeds from maturities of investment securities available for sale | |||||||||||
Proceeds from sales of investment securities available for sale | |||||||||||
Purchases of investment securities held to maturity | ( | ||||||||||
Proceeds from maturities of investment securities held to maturity | |||||||||||
Net increase in securities purchased under agreements resell | ( | ||||||||||
Net decrease (increase) in loans | ( | ||||||||||
Proceeds from sales of loans | |||||||||||
Net decrease (increase) in credit balances of factoring clients | ( | ||||||||||
Purchases of operating lease equipment | ( | ( | |||||||||
Proceeds from sales of operating lease equipment | |||||||||||
Purchases of premises and equipment | ( | ( | |||||||||
Proceeds from sales of premises and equipment | |||||||||||
Proceeds from sales of other real estate owned | |||||||||||
Cash acquired, net of cash paid as consideration for acquisition | |||||||||||
Other investing activities | ( | ||||||||||
Net cash provided by investing activities | |||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
Net increase (decrease) in time deposits | ( | ||||||||||
Net decrease in demand and other interest-bearing deposits | ( | ( | |||||||||
Net change in securities sold under customer repurchase agreements | |||||||||||
Repayment of short-term borrowings | ( | ||||||||||
Proceeds from issuance of short-term borrowings | |||||||||||
Repayment of long-term borrowings | ( | ( | |||||||||
Proceeds from issuance of long-term borrowings | |||||||||||
Cash dividends paid | ( | ( | |||||||||
Other financing activities | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Change in cash and due from banks | |||||||||||
Cash and due from banks at beginning of period | |||||||||||
Cash and due from banks at end of period | $ | $ |
Six Months Ended June 30, | |||||||||||
dollars in millions | 2023 | 2022 | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||||||||||
Cash paid (refunded) during the period for: | |||||||||||
Interest | $ | $ | |||||||||
Income taxes | ( | ||||||||||
Significant non-cash investing and financing activities: | |||||||||||
Transfers of loans to other real estate | |||||||||||
Transfers of premises and equipment to other real estate | |||||||||||
Dividends declared but not paid | |||||||||||
Transfer of assets from held for investment to held for sale | |||||||||||
Transfer of assets from held for sale to held for investment | |||||||||||
Loans held for sale exchanged for investment securities | |||||||||||
Commitments extended during the period on affordable housing investment credits | |||||||||||
Issuance of common stock as consideration for CIT Merger | |||||||||||
Stock based compensation as consideration for CIT Merger | |||||||||||
Issuance of preferred stock as consideration for CIT Merger | |||||||||||
Purchase Money Note as consideration for SVBB Acquisition | |||||||||||
dollars in millions | Fair Value Purchase Price Allocation as of March 27, 2023 | |||||||
Purchase price consideration | ||||||||
Purchase Money Note (1) | $ | |||||||
Value Appreciation Instrument | ||||||||
Purchase price consideration | $ | |||||||
Assets | ||||||||
Cash and due from banks | ||||||||
Interest-earning deposits at banks | ||||||||
Investment securities | ||||||||
Loans and leases, net of PCD ACL | ||||||||
Affordable housing tax credit investments | ||||||||
Premises and equipment | ||||||||
Core deposit intangibles | ||||||||
Other assets | ||||||||
Total assets acquired | $ | |||||||
Liabilities | ||||||||
Deposits | ||||||||
Borrowings | ||||||||
Deferred tax liabilities | ||||||||
Other liabilities | ||||||||
Total liabilities assumed | $ | |||||||
Fair value of net assets acquired | ||||||||
Preliminary gain on acquisition, after income taxes (2) | $ | |||||||
Preliminary gain on acquisition, before income taxes (2) | $ |
dollars in millions | Loans and Leases | ||||||||||
UPB | Fair Value | ||||||||||
Non-PCD loans and leases | $ | $ | |||||||||
PCD loans and leases | |||||||||||
Total loans and leases | $ | $ |
dollars in millions | Total PCD from SVBB Acquisition | ||||
UPB | $ | ||||
Fair value | |||||
Fair value discount | |||||
PCD gross-up | ( | ||||
Non-credit discount (1) | $ | ||||
dollars in millions | Fair Value | Estimated Useful Life | Amortization Method | ||||||||||||||
Core deposit intangibles | $ | Effective Yield |
dollars in millions | Fair Value | ||||
Accrued interest receivable | $ | ||||
Federal Home Loan Bank stock / Federal Reserve Bank stock | |||||
Fair value of derivative financial instruments, net | |||||
Other | |||||
Total other assets | $ |
dollars in millions | Fair Value | ||||
Commitments to fund tax credit investments | $ | ||||
Fair value of derivative financial instruments, net | |||||
Accrued expenses and accounts payable | |||||
Reserve for off-balance sheet credit exposures | |||||
Accrued interest payable | |||||
Other | |||||
Total other liabilities | $ |
dollars in millions, except shares issued and price per share | Purchase Price Allocation | ||||||||||||||||
Common share consideration | |||||||||||||||||
Shares of Class A Common Stock issued | |||||||||||||||||
Price per share on January 3, 2022 | $ | ||||||||||||||||
Common stock consideration | $ | ||||||||||||||||
Preferred stock consideration | |||||||||||||||||
Stock-based compensation consideration | |||||||||||||||||
Cash in lieu of fractional shares and other consideration paid | |||||||||||||||||
Purchase price consideration | $ | ||||||||||||||||
Assets | |||||||||||||||||
Cash and interest-earning deposits at banks | $ | ||||||||||||||||
Investment securities | |||||||||||||||||
Assets held for sale | |||||||||||||||||
Loans and leases | |||||||||||||||||
Operating lease equipment | |||||||||||||||||
Bank-owned life insurance | |||||||||||||||||
Intangible assets | |||||||||||||||||
Other assets | |||||||||||||||||
Total assets acquired | $ | ||||||||||||||||
Liabilities | |||||||||||||||||
Deposits | $ | ||||||||||||||||
Borrowings | |||||||||||||||||
Credit balances of factoring clients | |||||||||||||||||
Other liabilities | |||||||||||||||||
Total liabilities assumed | $ | ||||||||||||||||
Fair value of net assets acquired | |||||||||||||||||
Gain on acquisition | $ |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | ( | $ | ||||||||||||||||||
Government agency | ( | ||||||||||||||||||||||
Residential mortgage-backed securities | ( | ||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ||||||||||||||||||||||
Corporate bonds (1) | ( | ||||||||||||||||||||||
Municipal bonds | ( | ||||||||||||||||||||||
Total investment securities available for sale (1) | $ | $ | $ | ( | $ | ||||||||||||||||||
Investment in marketable equity securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | ( | $ | ||||||||||||||||||
Government agency | ( | ||||||||||||||||||||||
Residential mortgage-backed securities | ( | ||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ||||||||||||||||||||||
Supranational securities | ( | ||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | ( | $ | ||||||||||||||||||
Total investment securities(1) | $ | $ | $ | ( | $ | ||||||||||||||||||
(1) Balances presented net of allowance for credit losses of $ | |||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | ( | $ | ||||||||||||||||||
Government agency | ( | ||||||||||||||||||||||
Residential mortgage-backed securities | ( | ||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ||||||||||||||||||||||
Corporate bonds | ( | ||||||||||||||||||||||
Total investment securities available for sale | $ | $ | $ | ( | $ | ||||||||||||||||||
Investment in marketable equity securities | $ | $ | $ | ( | $ | ||||||||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | ( | $ | ||||||||||||||||||
Government agency | ( | ||||||||||||||||||||||
Residential mortgage-backed securities | ( | ||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ||||||||||||||||||||||
Supranational securities | ( | ||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | ( | $ | ||||||||||||||||||
Total investment securities | $ | $ | $ | ( | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||
Cost | Fair Value | Cost | Fair Value | ||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||
Non-amortizing securities maturing in: | |||||||||||||||||||||||
One year or less | $ | $ | $ | $ | |||||||||||||||||||
After one through five years | |||||||||||||||||||||||
After five through 10 years | |||||||||||||||||||||||
After 10 years | |||||||||||||||||||||||
Government agency | |||||||||||||||||||||||
Residential mortgage-backed securities | |||||||||||||||||||||||
Commercial mortgage-backed securities | |||||||||||||||||||||||
Total investment securities available for sale (1) | $ | $ | $ | $ | |||||||||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||
Non-amortizing securities maturing in: | |||||||||||||||||||||||
One year or less | $ | $ | $ | $ | |||||||||||||||||||
After one through five years | |||||||||||||||||||||||
After five through 10 years | |||||||||||||||||||||||
Residential mortgage-backed securities | |||||||||||||||||||||||
Commercial mortgage-backed securities | |||||||||||||||||||||||
Total investment securities held to maturity | $ | $ | $ | $ | |||||||||||||||||||
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Interest income - taxable investment securities | $ | $ | $ | $ | |||||||||||||||||||
Interest income - nontaxable investment securities | |||||||||||||||||||||||
Dividend income - marketable equity securities | |||||||||||||||||||||||
Interest on investment securities | $ | $ | $ | $ |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Gross realized gains on sales of investment securities available for sale | $ | $ | $ | $ | |||||||||||||||||||
Gross realized losses on sales of investment securities available for sale | ( | ||||||||||||||||||||||
Net realized losses on sales of investment securities available for sale | $ | $ | $ | ( | $ |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Fair value adjustment on marketable equity securities, net | $ | ( | $ | ( | $ | ( | $ | ( |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||||||||||||||
Less than 12 months | 12 months or more | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Government agency | ( | ( | ( | ||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate bonds (1) | ( | ( | ( | ||||||||||||||||||||||||||||||||
Municipal bonds | ( | ( | |||||||||||||||||||||||||||||||||
Total (1) | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Less than 12 months | 12 months or more | Total | |||||||||||||||||||||||||||||||||
Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | ||||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Government agency | ( | ( | ( | ||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ( | ||||||||||||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | $ | $ | ( |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Commercial | |||||||||||
Commercial construction | $ | $ | |||||||||
Owner occupied commercial mortgage | |||||||||||
Non-owner occupied commercial mortgage | |||||||||||
Commercial and industrial | |||||||||||
Leases | |||||||||||
Total commercial | |||||||||||
Consumer | |||||||||||
Residential mortgage | |||||||||||
Revolving mortgage | |||||||||||
Consumer auto | |||||||||||
Consumer other | |||||||||||
Total consumer | |||||||||||
SVB | |||||||||||
Global fund banking | |||||||||||
Investor dependent - early stage | |||||||||||
Investor dependent - growth stage | |||||||||||
Innovation C&I and cash flow dependent | |||||||||||
Private Bank | |||||||||||
CRE | |||||||||||
Other | |||||||||||
Total SVB | |||||||||||
Total loans and leases | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Deferred (fees) costs, including unamortized costs and unearned fees on non-PCD loans | $ | ( | $ | ||||||||
Net unamortized discount on acquired loans | |||||||||||
Non-PCD | $ | $ | |||||||||
PCD | |||||||||||
Total net unamortized discount | $ | $ |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | 90 Days or Greater | Total Past Due | Current | Total | ||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||
Leases | |||||||||||||||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||||||||
Revolving mortgage | |||||||||||||||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||
Global fund banking | |||||||||||||||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||||||||||||||
Investor dependent - growth stage | |||||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||||||||
Private Bank | |||||||||||||||||||||||||||||||||||
CRE | |||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||
Total SVB | |||||||||||||||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
30-59 Days Past Due | 60-89 Days Past Due | 90 Days or Greater | Total Past Due | Current | Total | ||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||
Leases | |||||||||||||||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||||||||
Revolving mortgage | |||||||||||||||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||
Non-Accrual Loans | Loans > 90 Days and Accruing | Non-Accrual Loans | Loans > 90 Days and Accruing | ||||||||||||||||||||
Commercial | |||||||||||||||||||||||
Commercial construction | $ | $ | $ | $ | |||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||
Leases | |||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||
Consumer | |||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||
Revolving mortgage | |||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||
SVB | |||||||||||||||||||||||
Global fund banking | |||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||
Investor dependent - growth stage | |||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||
Private Bank | |||||||||||||||||||||||
CRE | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total SVB | |||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ |
June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Risk Classification: | Term Loans by Origination Year | Revolving Converted to Term Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial and industrial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total leases | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial | $ | $ | $ | $ | $ | $ | $ | $ | $ |
June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Risk Classification: | Term Loans by Origination Year | Revolving Converted to Term Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Global fund banking | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total global fund banking | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total investor dependent - early stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - growth stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total investor dependent - growth stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Private bank | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total private bank | |||||||||||||||||||||||||||||||||||||||||||||||||||||
CRE | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total CRE | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total SVB | $ | $ | $ | $ | $ | $ | $ | $ | $ |
June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Days Past Due: | Term Loans by Origination Year | Revolving Converted to Term Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total residential mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Revolving mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revolving mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer auto | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer | $ | $ | $ | $ | $ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Risk Classification: | Term Loans by Origination Year | Revolving Converted to Term Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial construction | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial and industrial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Ungraded | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total leases | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial | $ | $ | $ | $ | $ | $ | $ | $ | $ |
December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Days Past Due: | Term Loans by Origination Year | Revolving Converted to Term Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total residential mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Revolving mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revolving mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer auto | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | |||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days | |||||||||||||||||||||||||||||||||||||||||||||||||||||
90 days or greater | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer | $ | $ | $ | $ | $ | $ | $ | $ | $ |
Six Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Term Loans by Origination Year | Revolving Converted to Term Loans | ||||||||||||||||||||||||||||||||||||||||||||||||||||
dollars in millions | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 & Prior | Revolving | Total | |||||||||||||||||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer auto | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer other | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - growth stage | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total SVB | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ | $ | $ | $ | $ | $ |
dollars in millions | Term Extension(1) | Other Than Insignificant Payment Delay | Interest Rate Reduction | ||||||||||||||||||||||||||||||||
Amortized Cost | Weighted Average Term Extension (Months) | Amortized Cost | Weighted Average Payment Delay (Months) | Amortized Cost | Weighted Average Interest Rate Reduction | ||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | 47 | $ | — | $ | % | |||||||||||||||||||||||||||||
Owner occupied commercial mortgage | 13 | — | |||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | 15 | — | |||||||||||||||||||||||||||||||||
Commercial and industrial | 24 | 6 | |||||||||||||||||||||||||||||||||
Total commercial | 17 | 6 | |||||||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||
Residential mortgage | 90 | — | |||||||||||||||||||||||||||||||||
Revolving mortgage | 55 | — | |||||||||||||||||||||||||||||||||
Consumer auto | 19 | — | |||||||||||||||||||||||||||||||||
Consumer other | 60 | — | |||||||||||||||||||||||||||||||||
Total consumer | 84 | — | |||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||
Investor dependent - early stage | 6 | 4 | |||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | 3 | 7 | |||||||||||||||||||||||||||||||||
Total SVB | 3 | 6 | |||||||||||||||||||||||||||||||||
Total loans and leases | $ | 16 | $ | 6 | $ | % |
dollars in millions | Term Extension(1) and Interest Rate Reduction | Term Extension(1) and Other Than Insignificant Payment Delay | Total | ||||||||||||||||||||||||||||||||||||||||||||
Amortized Cost | Weighted Average Term Extension (Months) | Weighted Average Interest Rate Reduction | Amortized Cost | Weighted Average Term Extension (Months) | Weighted Average Payment Delay (Months) | Amortized Cost | Total as a % of Loan and Lease Class | ||||||||||||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | $ | — | % | $ | — | — | $ | % | |||||||||||||||||||||||||||||||||||||||
Owner occupied commercial mortgage | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | 28 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total commercial | 28 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | — | ||||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage | 60 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Revolving mortgage | 44 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Consumer auto | 31 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Consumer other | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total consumer | 59 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - early stage | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total SVB | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total loans and leases | $ | 58 | % | $ | 0 | 0 | $ | % |
dollars in millions | Term Extension(1) | Other Than Insignificant Payment Delay | Interest Rate Reduction | ||||||||||||||||||||||||||||||||
Amortized Cost | Weighted Average Term Extension (Months) | Amortized Cost | Weighted Average Payment Delay (Months) | Amortized Cost | Weighted Average Interest Rate Reduction | ||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | 22 | $ | — | $ | % | |||||||||||||||||||||||||||||
Owner occupied commercial mortgage | 12 | — | |||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | 13 | — | |||||||||||||||||||||||||||||||||
Commercial and industrial | 22 | 6 | |||||||||||||||||||||||||||||||||
Total commercial | 15 | 6 | |||||||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||
Residential mortgage | 62 | — | |||||||||||||||||||||||||||||||||
Revolving mortgage | 56 | — | |||||||||||||||||||||||||||||||||
Consumer auto | 19 | — | |||||||||||||||||||||||||||||||||
Consumer other | 60 | — | |||||||||||||||||||||||||||||||||
Total consumer | 61 | — | |||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||
Investor dependent - early stage | 6 | 4 | |||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | 4 | 7 | |||||||||||||||||||||||||||||||||
Other | 17 | — | |||||||||||||||||||||||||||||||||
Total SVB | 4 | 6 | |||||||||||||||||||||||||||||||||
Total loans and leases | $ | 13 | $ | 6 | $ | % |
dollars in millions | Term Extension(1) and Interest Rate Reduction | Term Extension(1) and Other Than Insignificant Payment Delay | Total | ||||||||||||||||||||||||||||||||||||||||||||
Amortized Cost | Weighted Average Term Extension (Months) | Weighted Average Interest Rate Reduction | Amortized Cost | Weighted Average Term Extension (Months) | Weighted Average Payment Delay (Months) | Amortized Cost | Total as a % of Loan and Lease Class | ||||||||||||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | $ | — | % | $ | — | — | $ | % | |||||||||||||||||||||||||||||||||||||||
Owner occupied commercial mortgage | 36 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Commercial and industrial | 30 | 8 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
Total commercial | 32 | 8 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | — | ||||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage | 60 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Revolving mortgage | 53 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Consumer auto | 31 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Consumer other | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total consumer | 59 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||||||||||||||
Investor dependent - early stage | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total SVB | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total loans and leases | $ | 57 | % | $ | 8 | 2 | $ | % |
dollars in millions | Current | 30–59 Days Past Due | 60–89 Days Past Due | 90 days or greater Past Due | Total | ||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||
Commercial construction | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||
Total SVB | |||||||||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ | $ |
dollars in millions | Current | 30–59 Days Past Due | 60–89 Days Past Due | 90 days or greater Past Due | Total | ||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||
Commercial construction | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||||||||||
Total commercial | |||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||
Residential mortgage | |||||||||||||||||||||||||||||
Total consumer | |||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||
Investor dependent - early stage | |||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | |||||||||||||||||||||||||||||
Total SVB | |||||||||||||||||||||||||||||
Total loans and leases | $ | $ | $ | $ | $ |
dollars in millions | December 31, 2022 | ||||||||||||||||
Accruing | Non-Accruing | Total | |||||||||||||||
Commercial | |||||||||||||||||
Commercial construction | $ | $ | $ | ||||||||||||||
Owner occupied commercial mortgage | |||||||||||||||||
Non-owner occupied commercial mortgage | |||||||||||||||||
Commercial and industrial | |||||||||||||||||
Leases | |||||||||||||||||
Total commercial | |||||||||||||||||
Consumer | |||||||||||||||||
Residential mortgage | |||||||||||||||||
Revolving mortgage | |||||||||||||||||
Consumer auto | |||||||||||||||||
Consumer other | |||||||||||||||||
Total consumer | |||||||||||||||||
Total TDRs | $ | $ | $ |
dollars in millions (except for number of loans) | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2022 | |||||||||||||||||||||
Number of Loans | Amortized Cost at Period End | Number of Loans | Amortized Cost at Period End | ||||||||||||||||||||
Loans and leases | |||||||||||||||||||||||
Interest only | $ | $ | |||||||||||||||||||||
Loan term extension | |||||||||||||||||||||||
Below market rates | |||||||||||||||||||||||
Discharge from bankruptcy | |||||||||||||||||||||||
Total | $ | $ | |||||||||||||||||||||
dollars in millions | Three Months Ended | Six Months Ended | |||||||||
June 30, 2022 | June 30, 2022 | ||||||||||
TDR Defaults | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
FHLB of Atlanta | |||||||||||
Lendable collateral value of pledged non-PCD loans | $ | $ | |||||||||
Less: Advances | |||||||||||
Less: Letters of Credit | |||||||||||
Available borrowing capacity | $ | $ | |||||||||
Pledged non-PCD loans (contractual balance) | $ | $ | |||||||||
FRB | |||||||||||
Lendable collateral value of pledged non-PCD loans | $ | $ | |||||||||
Less: Advances | |||||||||||
Available borrowing capacity | $ | $ | |||||||||
Pledged non-PCD loans (contractual balance) | $ | $ |
dollars in millions | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
Commercial | Consumer | SVB | Total | Commercial | Consumer | SVB | Total | ||||||||||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Initial PCD ACL | |||||||||||||||||||||||||||||||||||||||||||||||
Day 2 provision for loans and leases | |||||||||||||||||||||||||||||||||||||||||||||||
Provision (benefit) for credit losses - loans and leases | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Total provision (benefit) for credit losses- loans and leases | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Three Months Ended June 30, 2022 | Six Months Ended June 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||
Commercial | Consumer | SVB | Total | Commercial | Consumer | SVB | Total | ||||||||||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Initial PCD ACL | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Day 2 provision for loans and leases | |||||||||||||||||||||||||||||||||||||||||||||||
Provision (benefit) for credit losses - loans and leases | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Total provision (benefit) for credit losses- loans and leases | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
Recoveries | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | $ | $ | $ | $ | $ | $ | $ | $ |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | |||||||||||||||||||
Day 2 provision for unfunded commitments | |||||||||||||||||||||||
(Benefit) provision for unfunded commitments | ( | ( | |||||||||||||||||||||
Total (benefit) provision for credit losses - unfunded commitments | ( | ||||||||||||||||||||||
Ending balance | $ | $ | $ | $ |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | |||||||||||||||||||
(Benefit) provision for credit losses - investment securities available for sale | ( | ||||||||||||||||||||||
Ending balance | $ | $ | $ | $ |
dollars in millions | Classification | June 30, 2023 | December 31, 2022 | ||||||||||||||
ROU assets: | |||||||||||||||||
Operating leases | $ | $ | |||||||||||||||
Finance leases | |||||||||||||||||
Total ROU assets | $ | $ | |||||||||||||||
Lease liabilities: | |||||||||||||||||
Operating leases | $ | $ | |||||||||||||||
Finance leases | |||||||||||||||||
Total lease liabilities | $ | $ | |||||||||||||||
Weighted-average remaining lease terms: | |||||||||||||||||
Operating leases | |||||||||||||||||
Finance leases | |||||||||||||||||
Weighted-average discount rate: | |||||||||||||||||
Operating leases | % | % | |||||||||||||||
Finance leases |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||
Classification | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||||
Lease cost | |||||||||||||||||||||||||||||
Operating lease cost (1) | Occupancy Expense | $ | $ | $ | $ | ||||||||||||||||||||||||
Finance lease cost | |||||||||||||||||||||||||||||
Amortization of leased assets | Equipment expense | ||||||||||||||||||||||||||||
Variable lease cost | Occupancy Expense | ||||||||||||||||||||||||||||
Sublease income | Occupancy Expense | ( | ( | ( | ( | ||||||||||||||||||||||||
Net lease cost | $ | $ | $ | $ |
dollars in millions | Six Months Ended June 30, | ||||||||||
2023 | 2022 | ||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Financing cash flows from finance leases | |||||||||||
ROU assets obtained in exchange for new operating lease liabilities | |||||||||||
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Lease income – Operating leases | $ | $ | $ | $ | |||||||||||||||||||
Variable lease income – Operating leases (1) | |||||||||||||||||||||||
Rental income on operating leases | |||||||||||||||||||||||
Interest income - Sales type and direct financing leases | |||||||||||||||||||||||
Variable lease income included in Other noninterest income (2) | |||||||||||||||||||||||
Interest income - Leveraged leases | |||||||||||||||||||||||
Total lease income | $ | $ | $ | $ |
dollars in millions | 2023 | ||||
Balance, net of accumulated amortization at January 1 | $ | ||||
Core deposit intangibles related to the SVBB Acquisition | |||||
Amortization for the period | ( | ||||
Balance at June 30, net of accumulated amortization | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Gross balance | $ | $ | |||||||||
Accumulated amortization | ( | ( | |||||||||
Balance, net of accumulated amortization | $ | $ |
dollars in millions | |||||
Remainder 2023 | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
2028 | |||||
Thereafter | |||||
Balance, net of accumulated amortization | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Investment in qualified affordable housing projects | $ | $ | |||||||||
Other tax credit equity investments | |||||||||||
Total tax credit equity investments | $ | $ | |||||||||
Other unconsolidated investments | |||||||||||
Total assets (maximum loss exposure) (1) | $ | $ | |||||||||
Liabilities for commitments to tax credit investments (2) | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Affordable housing tax credit and other unconsolidated investments (1) | $ | $ | |||||||||
Right of use assets for operating leases, net | |||||||||||
Pension assets | |||||||||||
Accrued interest receivable | |||||||||||
Income tax receivable | |||||||||||
Federal Home Loan Bank stock | |||||||||||
Fair value of derivative financial instruments | |||||||||||
Bank-owned life insurance | |||||||||||
Counterparty receivables | |||||||||||
Nonmarketable equity securities | |||||||||||
Other real estate owned | |||||||||||
Mortgage servicing rights | |||||||||||
Other (2) | |||||||||||
Total other assets | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Noninterest-bearing demand | $ | $ | |||||||||
Checking with interest | |||||||||||
Money market | |||||||||||
Savings | |||||||||||
Time | |||||||||||
Total deposits | $ | $ |
dollars in millions | |||||
Twelve months ended June 30, | |||||
2024 | $ | ||||
2025 | |||||
2026 | |||||
2027 | |||||
2028 | |||||
Thereafter | |||||
Total time deposits | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Securities sold under customer repurchase agreements | $ | $ | |||||||||
Notes payable to FHLB of Atlanta at overnight SOFR plus | |||||||||||
Total short-term borrowings | $ | $ |
dollars in millions | Maturity | June 30, 2023 | December 31, 2022 | ||||||||||||||
Parent Company: | |||||||||||||||||
Senior: | |||||||||||||||||
Senior unsecured fixed line of credit at | September 2023 | $ | $ | ||||||||||||||
Subordinated: | |||||||||||||||||
Fixed-to-Floating subordinated notes at | March 2030 | ||||||||||||||||
Junior subordinated debentures at 3-month LIBOR plus | June 2034 | ||||||||||||||||
Junior subordinated debentures at 3-month LIBOR plus | June 2036 | ||||||||||||||||
Subsidiaries: | |||||||||||||||||
Senior: | |||||||||||||||||
Senior unsecured fixed-to-floating rate notes at | June 2024 | ||||||||||||||||
Senior unsecured fixed-to-floating rate notes at | September 2025 | ||||||||||||||||
Fixed senior unsecured notes at | April 2036 | ||||||||||||||||
Subordinated: | |||||||||||||||||
Fixed subordinated notes at | March 2028 | ||||||||||||||||
Fixed-to-Fixed subordinated notes at | November 2029 | ||||||||||||||||
Junior subordinated debentures at 3-month LIBOR plus | March 2034 | ||||||||||||||||
Junior subordinated debentures at 3-month LIBOR plus | April 2034 | ||||||||||||||||
Secured: | |||||||||||||||||
Notes payable to FHLB of Atlanta at overnight SOFR plus spreads ranging from | Maturities through September 2025 | ||||||||||||||||
Purchase Money Note to FDIC fixed at | March 2028 | ||||||||||||||||
Other secured financings | Maturities through January 2024 | ||||||||||||||||
Capital lease obligations | Maturities through June 2027 | ||||||||||||||||
Unamortized issuance costs | ( | ( | |||||||||||||||
Unamortized purchase accounting adjustments (2) | ( | ||||||||||||||||
Total long-term borrowings | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||
Notional Amount | Asset Fair Value | Liability Fair Value | Notional Amount | Asset Fair Value | Liability Fair Value | ||||||||||||||||||||||||||||||
Derivatives not designated as hedging instruments (Non-qualifying hedges) | |||||||||||||||||||||||||||||||||||
Interest rate contracts (1) (4) | $ | $ | $ | ( | $ | $ | $ | ( | |||||||||||||||||||||||||||
Foreign exchange contracts (2) | ( | ( | |||||||||||||||||||||||||||||||||
Other contracts (3) | ( | ||||||||||||||||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | ( | $ | ( | |||||||||||||||||||||||||||||||
Gross derivatives fair values presented in the Consolidated Balance Sheets | ( | ( | |||||||||||||||||||||||||||||||||
Less: Gross amounts offset in the Consolidated Balance Sheets | |||||||||||||||||||||||||||||||||||
Net amount presented in the Consolidated Balance Sheets | ( | ( | |||||||||||||||||||||||||||||||||
Less: Amounts subject to master netting agreements (5) | ( | ( | |||||||||||||||||||||||||||||||||
Less: Cash collateral pledged(received) subject to master netting agreements (6) | ( | ( | |||||||||||||||||||||||||||||||||
Total net derivative fair value | $ | $ | ( | $ | $ | ( |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||
Amounts Recognized | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||||
Interest rate contracts | Other noninterest income | $ | $ | $ | $ | ||||||||||||||||||||||||
Foreign currency forward contracts | Other noninterest income | ( | |||||||||||||||||||||||||||
Total non-qualifying hedges - income statement impact | $ | $ | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Fair value of derivative financial instruments | $ | $ | |||||||||
Lease liabilities | |||||||||||
Accrued expenses and accounts payable | |||||||||||
Commitments to fund tax credit investments | |||||||||||
Deferred taxes | |||||||||||
ACL for unfunded commitments | |||||||||||
Incentive plan liabilities | |||||||||||
Accrued interest payable | |||||||||||
Other | |||||||||||
Total other liabilities | $ | $ |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
Assets | |||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
Government agency | |||||||||||||||||||||||
Residential mortgage-backed securities | |||||||||||||||||||||||
Commercial mortgage-backed securities | |||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||
Total investment securities available for sale | $ | $ | $ | $ | |||||||||||||||||||
Marketable equity securities | |||||||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||
Derivative assets (1) | |||||||||||||||||||||||
Interest rate contracts — non-qualifying hedges | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts — non-qualifying hedges | |||||||||||||||||||||||
Other derivative contracts — non-qualifying hedges | |||||||||||||||||||||||
Total derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Liabilities | |||||||||||||||||||||||
Derivative liabilities (1) | |||||||||||||||||||||||
Interest rate contracts — non-qualifying hedges | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts — non-qualifying hedges | |||||||||||||||||||||||
Other derivative contracts — non-qualifying hedges | |||||||||||||||||||||||
Total derivative liabilities | $ | $ | $ | $ | |||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||
Assets | |||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||
U.S. Treasury | $ | $ | $ | $ | |||||||||||||||||||
Government agency | |||||||||||||||||||||||
Residential mortgage-backed securities | |||||||||||||||||||||||
Commercial mortgage-backed securities | |||||||||||||||||||||||
Corporate bonds | |||||||||||||||||||||||
Municipal bonds | |||||||||||||||||||||||
Total investment securities available for sale | $ | $ | $ | $ | |||||||||||||||||||
Marketable equity securities | |||||||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||
Derivative assets (1) | |||||||||||||||||||||||
Interest rate contracts — non-qualifying hedges | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts — non-qualifying hedges | |||||||||||||||||||||||
Other derivative contracts — non-qualifying hedges | |||||||||||||||||||||||
Total derivative assets | $ | $ | $ | $ | |||||||||||||||||||
Liabilities | |||||||||||||||||||||||
Derivative liabilities (1) | |||||||||||||||||||||||
Interest rate contracts — non-qualifying hedges | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts — non-qualifying hedges | |||||||||||||||||||||||
Other derivative contracts — non-qualifying hedges | |||||||||||||||||||||||
Total derivative liabilities | $ | $ | $ | $ |
dollars in millions | |||||||||||||||||
Financial Instrument | Estimated Fair Value | Valuation Technique(s) | Significant Unobservable Inputs | ||||||||||||||
June 30, 2023 | |||||||||||||||||
Assets | |||||||||||||||||
Corporate bonds | $ | Indicative bid provided by broker | Multiple factors, including but not limited to, current operations, financial condition, cash flows, and recently executed financing transactions related to the issuer. | ||||||||||||||
Interest rate & other derivative — non-qualifying hedges | $ | Internal valuation model | Not material | ||||||||||||||
Liabilities | |||||||||||||||||
Interest rate & other derivative — non-qualifying hedges | $ | Internal valuation model | Not material | ||||||||||||||
December 31, 2022 | |||||||||||||||||
Assets | |||||||||||||||||
Corporate bonds | $ | Indicative bid provided by broker | Multiple factors, including but not limited to, current operations, financial condition, cash flows, and recently executed financing transactions related to the issuer. | ||||||||||||||
dollars in millions | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||
Corporate Bonds | Other Derivative Assets — Non-Qualifying | Other Derivative Liabilities — Non-Qualifying | Corporate Bonds | Other Derivative Assets — Non-Qualifying | Other Derivative Liabilities — Non-Qualifying | ||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Purchases | |||||||||||||||||||||||||||||||||||
Changes in FV included in earnings | ( | ||||||||||||||||||||||||||||||||||
Changes in FV included in comprehensive income | ( | ( | |||||||||||||||||||||||||||||||||
Transfers in | |||||||||||||||||||||||||||||||||||
Transfers out | ( | ||||||||||||||||||||||||||||||||||
Maturity and settlements | ( | ||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ |
dollars in millions | June 30, 2023 | ||||||||||||||||
Fair Value | Unpaid Principal Balance | Difference | |||||||||||||||
Originated loans held for sale | $ | $ | $ | ||||||||||||||
December 31, 2022 | |||||||||||||||||
Fair Value | Unpaid Principal Balance | Difference | |||||||||||||||
Originated loans held for sale | $ | $ | $ |
dollars in millions | Fair Value Measurements | ||||||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total Gains (Losses) | |||||||||||||||||||||||||
June 30, 2023 | |||||||||||||||||||||||||||||
Assets held for sale - loans | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||
Loans - collateral dependent loans | ( | ||||||||||||||||||||||||||||
Other real estate owned | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Assets held for sale - loans | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||
Loans - collateral dependent loans | ( | ||||||||||||||||||||||||||||
Other real estate owned | |||||||||||||||||||||||||||||
Mortgage servicing rights | |||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | ( |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||||||||
Estimated Fair Value | |||||||||||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
Financial Assets | |||||||||||||||||||||||||||||
Cash and due from banks | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest earning deposits at banks | |||||||||||||||||||||||||||||
Securities purchased under agreements to resell | |||||||||||||||||||||||||||||
Investment in marketable equity securities | |||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||||||||
Net loans | |||||||||||||||||||||||||||||
Accrued interest receivable | |||||||||||||||||||||||||||||
Federal Home Loan Bank stock | |||||||||||||||||||||||||||||
Mortgage servicing rights | |||||||||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||||||||
Financial Liabilities | |||||||||||||||||||||||||||||
Deposits with no stated maturity | |||||||||||||||||||||||||||||
Time deposits | |||||||||||||||||||||||||||||
Credit balances of factoring clients | |||||||||||||||||||||||||||||
Securities sold under customer repurchase agreements | |||||||||||||||||||||||||||||
Long-term borrowings | |||||||||||||||||||||||||||||
Accrued interest payable | |||||||||||||||||||||||||||||
Derivative liabilities | |||||||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||
Estimated Fair Value | |||||||||||||||||||||||||||||
Carrying Value | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
Financial Assets | |||||||||||||||||||||||||||||
Cash and due from banks | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest earning deposits at banks | |||||||||||||||||||||||||||||
Investment in marketable equity securities | |||||||||||||||||||||||||||||
Investment securities available for sale | |||||||||||||||||||||||||||||
Investment securities held to maturity | |||||||||||||||||||||||||||||
Loans held for sale | |||||||||||||||||||||||||||||
Net loans | |||||||||||||||||||||||||||||
Accrued interest receivable | |||||||||||||||||||||||||||||
Federal Home Loan Bank stock | |||||||||||||||||||||||||||||
Mortgage servicing rights | |||||||||||||||||||||||||||||
Derivative assets | |||||||||||||||||||||||||||||
Financial Liabilities | |||||||||||||||||||||||||||||
Deposits with no stated maturity | |||||||||||||||||||||||||||||
Time deposits | |||||||||||||||||||||||||||||
Credit balances of factoring clients | |||||||||||||||||||||||||||||
Securities sold under customer repurchase agreements | |||||||||||||||||||||||||||||
Other short-term borrowings | |||||||||||||||||||||||||||||
Long-term borrowings | |||||||||||||||||||||||||||||
Accrued interest payable | |||||||||||||||||||||||||||||
Derivative liabilities |
Outstanding | |||||||||||
Class A | Class B | ||||||||||
Common stock - March 31, 2023 | |||||||||||
Restricted stock units vested, net of shares held to cover taxes | |||||||||||
Common stock - June 30, 2023 | |||||||||||
Common stock - December 31, 2022 | |||||||||||
Restricted stock units vested, net of shares held to cover taxes | |||||||||||
Common stock - June 30, 2023 |
dollars in millions, except per share and par value data | ||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Issuance Date | Earliest Redemption Date | Par Value | Shares Issued and Outstanding | Liquidation Preference Per Share | Total Liquidation Preference | Dividend | Dividend Payment Dates | ||||||||||||||||||||||||||||||||||||||||||
Series A | March 12, 2020 | March 15, 2025 | $ | $ | Quarterly in arrears on March 15, June 15, September 15, and December 15 | |||||||||||||||||||||||||||||||||||||||||||||
Series B(1) | January 3, 2022 | January 4, 2027 | $ | $ | LIBOR + | |||||||||||||||||||||||||||||||||||||||||||||
Series C | January 3, 2022 | January 4, 2027 | $ | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||
Pretax | Income Taxes | Net of Income Taxes | Pretax | Income Taxes | Net of Income Taxes | ||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||
Unrealized loss on securities available for sale transferred to held to maturity | ( | ( | ( | ( | |||||||||||||||||||||||||||||||
Defined benefit pension items | ( | ( | |||||||||||||||||||||||||||||||||
Total accumulated other comprehensive loss | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( |
dollars in millions | Unrealized (loss) gain on securities available for sale | Unrealized (loss) gain on securities available for sale transferred to held to maturity | Net change in defined benefit pension items | Total accumulated other comprehensive (loss) income | |||||||||||||||||||
Balance as of December 31, 2022 | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
AOCI activity before reclassifications | ( | ( | |||||||||||||||||||||
Amounts reclassified from AOCI to earnings | |||||||||||||||||||||||
Other comprehensive (loss) income for the period | ( | ( | |||||||||||||||||||||
Balance as of June 30, 2023 | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
Balance as of December 31, 2021 | $ | ( | $ | ( | $ | $ | |||||||||||||||||
AOCI activity before reclassifications | ( | ( | |||||||||||||||||||||
Amounts reclassified from AOCI to earnings | |||||||||||||||||||||||
Other comprehensive (loss) income for the period | ( | ( | |||||||||||||||||||||
Balance as of June 30, 2022 | $ | ( | $ | ( | $ | $ | ( |
dollars in millions | Three Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||
Pretax | Income Taxes | Net of Income Taxes | Pretax | Income Taxes | Net of Income Taxes | Income Statement Line Items | |||||||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale: | |||||||||||||||||||||||||||||||||||||||||
AOCI activity before reclassifications | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | $ | ( | $ | $ | ( | $ | $ | $ | Provision for credit losses | ||||||||||||||||||||||||||||||||
Other comprehensive loss on securities available for sale | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale transferred to held to maturity: | |||||||||||||||||||||||||||||||||||||||||
AOCI activity before reclassifications | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | Interest on investment securities | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income on securities available for sale transferred to held to maturity | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Defined benefit pension items: | |||||||||||||||||||||||||||||||||||||||||
Actuarial loss | $ | ( | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | ( | Other noninterest expense | |||||||||||||||||||||||||||||||||||||||
Other comprehensive (loss) income for defined benefit pension items | $ | ( | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Total other comprehensive loss | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( |
dollars in millions | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||||||||||||||||||||
Pretax | Income Taxes | Net of Income Taxes | Pretax | Income Taxes | Net of Income Taxes | Income Statement Line Items | |||||||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale: | |||||||||||||||||||||||||||||||||||||||||
AOCI activity before reclassifications | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | $ | $ | ( | $ | $ | $ | $ | $14 realized loss on sales of investment securities available for sale, net; $3 provision for credit losses | |||||||||||||||||||||||||||||||||
Other comprehensive loss on securities available for sale | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||||||||
Unrealized loss on securities available for sale transferred to held to maturity: | |||||||||||||||||||||||||||||||||||||||||
AOCI activity before reclassifications | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | Interest on investment securities | ||||||||||||||||||||||||||||||||||||||||
Other comprehensive income on securities available for sale transferred to held to maturity | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Defined benefit pension items: | |||||||||||||||||||||||||||||||||||||||||
Actuarial loss | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
Amounts reclassified from AOCI to earnings | ( | Other noninterest expense | |||||||||||||||||||||||||||||||||||||||
Other comprehensive income for defined benefit pension items | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||
Total other comprehensive loss | $ | ( | $ | $ | ( | $ | ( | $ | $ | ( |
Basel III Minimums | Basel III Conservation Buffers | Basel III Requirements | |||||||||||||||
Regulatory capital ratios | |||||||||||||||||
Total risk-based capital | % | 2.50 | % | % | |||||||||||||
Tier 1 risk-based capital | 2.50 | ||||||||||||||||
Common equity Tier 1 | 2.50 | ||||||||||||||||
Tier 1 leverage | — |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||
Basel III Requirements | PCA well-capitalized thresholds | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||
BancShares | |||||||||||||||||||||||||||||||||||
Total risk-based capital | % | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 risk-based capital | |||||||||||||||||||||||||||||||||||
Common equity Tier 1 | |||||||||||||||||||||||||||||||||||
Tier 1 leverage | |||||||||||||||||||||||||||||||||||
FCB | |||||||||||||||||||||||||||||||||||
Total risk-based capital | % | % | $ | % | $ | % | |||||||||||||||||||||||||||||
Tier 1 risk-based capital | |||||||||||||||||||||||||||||||||||
Common equity Tier 1 | |||||||||||||||||||||||||||||||||||
Tier 1 leverage |
dollars in millions, except per share data | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Preferred stock dividends | |||||||||||||||||||||||
Net income available to common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Basic shares outstanding | |||||||||||||||||||||||
Stock-based awards | |||||||||||||||||||||||
Diluted shares outstanding | |||||||||||||||||||||||
Earnings per common share | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ |
dollars in millions | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Expected return on assets | ( | ( | ( | ( | |||||||||||||||||||
Amortization of prior service cost | |||||||||||||||||||||||
Amortization of net actuarial loss | |||||||||||||||||||||||
Net periodic benefit | $ | ( | $ | ( | $ | ( | $ | ( |
dollars in millions | Three Months Ended June 30, 2023 | ||||||||||||||||||||||||||||||||||
General Banking | Commercial Banking | Silicon Valley Banking | Rail | Corporate | Total BancShares | ||||||||||||||||||||||||||||||
Net interest income (expense) | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||
Provision (benefit) for credit losses | ( | ( | |||||||||||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | ( | ||||||||||||||||||||||||||||||||||
Noninterest income | |||||||||||||||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||||||||
Loans and leases | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Deposits | |||||||||||||||||||||||||||||||||||
Operating lease equipment, net | |||||||||||||||||||||||||||||||||||
Three Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||
General Banking | Commercial Banking | Silicon Valley Banking | Rail | Corporate | Total BancShares | ||||||||||||||||||||||||||||||
Net interest income (expense) | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||
Provision for credit losses | |||||||||||||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | ( | ||||||||||||||||||||||||||||||||||
Noninterest income | |||||||||||||||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | ( | ||||||||||||||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||||||||
Loans and leases | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Deposits | |||||||||||||||||||||||||||||||||||
Operating lease equipment, net |
Six Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||
General Banking | Commercial Banking | Silicon Valley Banking | Rail | Corporate | Total BancShares | ||||||||||||||||||||||||||||||
Net interest income (expense) | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||
Provision (benefit) for credit losses | ( | ||||||||||||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | ( | ( | |||||||||||||||||||||||||||||||||
Noninterest income | |||||||||||||||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||||||||||||||
Income tax expense (benefit) | ( | ||||||||||||||||||||||||||||||||||
Net income | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Six Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||
General Banking | Commercial Banking | Silicon Valley Banking | Rail | Corporate | Total BancShares | ||||||||||||||||||||||||||||||
Net interest income (expense) | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||
(Benefit) provision for credit losses | ( | ||||||||||||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | ( | ( | |||||||||||||||||||||||||||||||||
Noninterest income | |||||||||||||||||||||||||||||||||||
Noninterest expense | |||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | ( | ||||||||||||||||||||||||||||||||||
Income tax expense (benefit) | ( | ||||||||||||||||||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | $ | ( | $ |
dollars in millions | June 30, 2023 | December 31, 2022 | |||||||||
Financing Commitments | |||||||||||
Financing assets (excluding leases) | $ | $ | |||||||||
Letters of Credit | |||||||||||
Standby letters of credit | |||||||||||
Other letters of credit | |||||||||||
Deferred Purchase Agreements | |||||||||||
Purchase and Funding Commitments (1) |
dollars in millions, except share data | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
SUMMARY OF OPERATIONS | |||||||||||||||||||||||||||||
Interest income | $ | 2,953 | $ | 1,211 | $ | 757 | $ | 4,164 | $ | 1,467 | |||||||||||||||||||
Interest expense | 992 | 361 | 57 | 1,353 | 118 | ||||||||||||||||||||||||
Net interest income | 1,961 | 850 | 700 | 2,811 | 1,349 | ||||||||||||||||||||||||
Provision for credit losses | 151 | 783 | 42 | 934 | 506 | ||||||||||||||||||||||||
Net interest income after provision for credit losses | 1,810 | 67 | 658 | 1,877 | 843 | ||||||||||||||||||||||||
Noninterest income | 658 | 10,259 | 424 | 10,917 | 1,274 | ||||||||||||||||||||||||
Noninterest expense | 1,572 | 855 | 745 | 2,427 | 1,555 | ||||||||||||||||||||||||
Income before income taxes | 896 | 9,471 | 337 | 10,367 | 562 | ||||||||||||||||||||||||
Income tax (benefit) expense | 214 | (47) | 82 | 167 | 36 | ||||||||||||||||||||||||
Net income | 682 | 9,518 | 255 | 10,200 | 526 | ||||||||||||||||||||||||
Preferred stock dividends | 15 | 14 | 17 | 29 | 24 | ||||||||||||||||||||||||
Net income available to common stockholders | $ | 667 | $ | 9,504 | $ | 238 | $ | 10,171 | $ | 502 | |||||||||||||||||||
PER COMMON SHARE DATA | |||||||||||||||||||||||||||||
Average diluted common shares | 14,537,938 | 14,539,709 | 16,035,090 | 14,539,176 | 15,937,826 | ||||||||||||||||||||||||
Earnings per common share (diluted) | $ | 45.87 | $ | 653.64 | $ | 14.86 | $ | 699.53 | $ | 31.48 | |||||||||||||||||||
KEY PERFORMANCE METRICS | |||||||||||||||||||||||||||||
Return on average assets (ROA) | 1.31 | % | 33.23 | % | 0.95 | % | 12.62 | % | 0.97 | % | |||||||||||||||||||
Net interest margin (NIM) (1) | 4.10 | 3.41 | 3.04 | 3.86 | 2.89 | ||||||||||||||||||||||||
SELECTED QUARTERLY AVERAGE BALANCES | |||||||||||||||||||||||||||||
Investment securities | $ | 19,806 | $ | 19,416 | $ | 19,185 | $ | 19,612 | $ | 19,338 | |||||||||||||||||||
Total loans and leases (2) | 134,696 | 74,907 | 66,487 | 104,966 | 65,899 | ||||||||||||||||||||||||
Operating lease equipment, net | 8,405 | 8,236 | 7,973 | 8,321 | 7,949 | ||||||||||||||||||||||||
Total assets | 209,309 | 116,164 | 107,575 | 162,994 | 108,977 | ||||||||||||||||||||||||
Total deposits | 137,408 | 93,839 | 90,621 | 115,743 | 91,119 | ||||||||||||||||||||||||
Total stockholders’ equity | 19,521 | 11,369 | 10,567 | 15,445 | 10,495 | ||||||||||||||||||||||||
SELECTED QUARTER-END BALANCES | |||||||||||||||||||||||||||||
Investment securities | $ | 22,171 | $ | 19,527 | $ | 19,136 | |||||||||||||||||||||||
Total loans and leases | 133,015 | 138,288 | 67,735 | ||||||||||||||||||||||||||
Operating lease equipment, net | 8,531 | 8,331 | 7,971 | ||||||||||||||||||||||||||
Total assets | 209,502 | 214,658 | 107,673 | ||||||||||||||||||||||||||
Total deposits | 141,164 | 140,050 | 89,329 | ||||||||||||||||||||||||||
Total stockholders’ equity | 19,771 | 19,216 | 10,642 | ||||||||||||||||||||||||||
Loan to deposit ratio | 94.23 | % | 98.74 | % | 75.83 | % | |||||||||||||||||||||||
Noninterest-bearing deposits to total deposits | 31.56 | 39.02 | 29.75 | ||||||||||||||||||||||||||
CAPITAL RATIOS | |||||||||||||||||||||||||||||
Common equity Tier 1 | 13.38 | % | 12.53 | % | 11.35 | % | |||||||||||||||||||||||
Tier 1 risk-based capital | 14.00 | 13.13 | 12.37 | ||||||||||||||||||||||||||
Total risk-based capital | 15.84 | 14.86 | 14.46 | ||||||||||||||||||||||||||
Tier 1 leverage | 9.50 | 16.72 | 9.85 | ||||||||||||||||||||||||||
ASSET QUALITY | |||||||||||||||||||||||||||||
Ratio of nonaccrual loans to total loans | 0.70 | % | 0.60 | % | 0.76 | % | |||||||||||||||||||||||
Allowance for credit losses to loans ratio | 1.23 | 1.16 | 1.26 | ||||||||||||||||||||||||||
Net charge off ratio | 0.47 | 0.27 | 0.13 | 0.39 | 0.11 |
Deposits as of June 30, 2023 | |||||||||||||||||
Ending Balance (in millions) | Average Size (in thousands) | Uninsured % | |||||||||||||||
General Banking segment | $ | 95,323 | $ | 38 | 25 | % | |||||||||||
Commercial Banking segment | 3,064 | 255 | 87 | ||||||||||||||
SVB segment | 40,860 | 314 | 72 | ||||||||||||||
Other business segments | 1,917 | n/m | 3 | ||||||||||||||
Total | $ | 141,164 | 53 | 40 |
(dollars in millions) | Deposit Balance | ||||||||||||||||||||||||||||||||||
Acquisition Date | |||||||||||||||||||||||||||||||||||
June 30, 2023 | April 28, 2023 | April 14, 2023 | March 31, 2023 | March 27, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||
SVB segment | $ | 40,860 | $ | 41,425 | $ | 41,336 | $ | 49,259 | $ | 55,899 | $ | — | |||||||||||||||||||||||
General Banking, Commercial Banking, Rail and Corporate segments | 100,304 | 92,447 | 92,149 | 90,791 | — | 89,408 | |||||||||||||||||||||||||||||
Total deposits | $ | 141,164 | $ | 133,872 | $ | 133,485 | $ | 140,050 | $ | 89,408 |
dollars in millions | June 30, 2023 | ||||||||||||||||||||||
Composition(1) | Amortized cost | Fair value | Fair value to cost | ||||||||||||||||||||
Total investment securities available for sale | 57.6 | % | $ | 12,923 | $ | 11,894 | 92.0 | % | |||||||||||||||
Total investment securities held to maturity | 42.0 | 10,201 | 8,652 | 84.8 | |||||||||||||||||||
Investment in marketable equity securities | 0.4 | 75 | 76 | 101.3 | |||||||||||||||||||
Total investment securities | 100 | % | $ | 23,199 | $ | 20,622 | |||||||||||||||||
(1) Calculated as a percentage of the total fair value of investment securities. |
dollars in millions | Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | Change in NII Due to: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Average Balance | Income / Expense | Yield / Rate | Average Balance | Income / Expense | Yield / Rate | Volume(1) | Yield /Rate(1) | Total Change | |||||||||||||||||||||||||||||||||||||||||||||
Loans and leases (1)(2) | $ | 133,528 | $ | 2,353 | 7.06 | % | $ | 73,900 | $ | 1,017 | 5.57 | % | $ | 1,003 | $ | 333 | $ | 1,336 | |||||||||||||||||||||||||||||||||||
Investment securities | 19,806 | 117 | 2.36 | 19,416 | 107 | 2.21 | 2 | 8 | 10 | ||||||||||||||||||||||||||||||||||||||||||||
Securities purchased under agreements to resell | 191 | 3 | 4.92 | — | — | — | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Interest-earning deposits at banks | 38,014 | 480 | 5.07 | 7,585 | 87 | 4.61 | 389 | 4 | 393 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-earning assets (2) | $ | 191,539 | $ | 2,953 | 6.18 | % | $ | 100,901 | $ | 1,211 | 4.85 | % | $ | 1,397 | $ | 345 | $ | 1,742 | |||||||||||||||||||||||||||||||||||
Operating lease equipment, net | $ | 8,405 | $ | 8,236 | |||||||||||||||||||||||||||||||||||||||||||||||||
Cash and due from banks | 1,161 | 595 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses | (1,600) | (936) | |||||||||||||||||||||||||||||||||||||||||||||||||||
All other noninterest-earning assets | 9,804 | 7,368 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 209,309 | $ | 116,164 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest-bearing deposits | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Checking with interest | $ | 24,164 | $ | 118 | 1.92 | % | $ | 16,494 | $ | 22 | 0.50 | % | $ | 13 | $ | 83 | $ | 96 | |||||||||||||||||||||||||||||||||||
Money Market | 29,066 | 148 | 2.04 | 21,216 | 80 | 1.53 | 36 | 32 | 68 | ||||||||||||||||||||||||||||||||||||||||||||
Savings | 21,979 | 188 | 3.44 | 17,521 | 110 | 2.54 | 32 | 46 | 78 | ||||||||||||||||||||||||||||||||||||||||||||
Time deposits | 14,958 | 121 | 3.24 | 12,126 | 76 | 2.55 | 21 | 24 | 45 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 90,167 | 575 | 2.56 | 67,357 | 288 | 1.73 | 102 | 185 | 287 | ||||||||||||||||||||||||||||||||||||||||||||
Borrowings: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities sold under customer repurchase agreements | 456 | 1 | 0.31 | 455 | — | 0.30 | 1 | — | 1 | ||||||||||||||||||||||||||||||||||||||||||||
Short-term FHLB borrowings | 110 | 1 | 5.17 | 328 | 4 | 4.67 | (3) | — | (3) | ||||||||||||||||||||||||||||||||||||||||||||
Short-term borrowings | 566 | 2 | 1.26 | 783 | 4 | 2.13 | (2) | — | (2) | ||||||||||||||||||||||||||||||||||||||||||||
FHLB borrowings | 5,558 | 74 | 5.35 | 3,284 | 40 | 4.96 | 30 | 4 | 34 | ||||||||||||||||||||||||||||||||||||||||||||
Senior unsecured borrowings | 798 | 4 | 2.11 | 883 | 5 | 2.06 | (1) | — | (1) | ||||||||||||||||||||||||||||||||||||||||||||
Subordinated debt | 1,045 | 10 | 3.59 | 1,048 | 9 | 3.54 | — | 1 | 1 | ||||||||||||||||||||||||||||||||||||||||||||
Other borrowings | 35,168 | 327 | 3.74 | 1,978 | 15 | 2.95 | 307 | 5 | 312 | ||||||||||||||||||||||||||||||||||||||||||||
Long-term borrowings | 42,569 | 415 | 3.91 | 7,193 | 69 | 3.84 | 336 | 10 | 346 | ||||||||||||||||||||||||||||||||||||||||||||
Total borrowings | 43,135 | 417 | 3.88 | 7,976 | 73 | 3.68 | 334 | 10 | 344 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | $ | 133,302 | $ | 992 | 2.98 | % | $ | 75,333 | $ | 361 | 1.94 | % | $ | 436 | $ | 195 | $ | 631 | |||||||||||||||||||||||||||||||||||
Noninterest-bearing deposits | $ | 47,241 | $ | 26,482 | |||||||||||||||||||||||||||||||||||||||||||||||||
Credit balances of factoring clients | 1,168 | 1,007 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other noninterest-bearing liabilities | 8,077 | 1,973 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' equity | 19,521 | 11,369 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 209,309 | $ | 116,164 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest rate spread (2) | 3.20 | % | 2.91 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
Net interest income and net yield on interest-earning assets (2) | $ | 1,961 | 4.10 | % | $ | 850 | 3.41 | % |
dollars in millions | Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2023 | June 30, 2022 | Change in NII Due to: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Average Balance | Income / Expense | Yield / Rate | Average Balance | Income / Expense | Yield / Rate | Volume(1) | Yield /Rate(1) | Total Change | |||||||||||||||||||||||||||||||||||||||||||||
Loans and leases (1)(2) | $ | 133,528 | $ | 2,353 | 7.06 | % | $ | 65,298 | $ | 655 | 4.03 | % | $ | 985 | $ | 713 | $ | 1,698 | |||||||||||||||||||||||||||||||||||
Investment securities | 19,806 | 117 | 2.36 | 19,185 | 89 | 1.85 | 3 | 25 | 28 | ||||||||||||||||||||||||||||||||||||||||||||
Securities purchased under agreements to resell | 191 | 3 | 4.92 | — | — | — | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Interest-earning deposits at banks | 38,014 | 480 | 5.07 | 7,629 | 13 | 0.72 | 187 | 280 | 467 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-earning assets (2) | $ | 191,539 | $ | 2,953 | 6.18 | % | $ | 92,112 | $ | 757 | 3.28 | % | $ | 1,178 | $ | 1,018 | $ | 2,196 | |||||||||||||||||||||||||||||||||||
Operating lease equipment, net | $ | 8,405 | $ | 7,973 | |||||||||||||||||||||||||||||||||||||||||||||||||
Cash and due from banks | 1,161 | 524 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses | (1,600) | (849) | |||||||||||||||||||||||||||||||||||||||||||||||||||
All other noninterest-earning assets | 9,804 | 7,815 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 209,309 | $ | 107,575 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest-bearing deposits | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Checking with interest | $ | 24,164 | $ | 118 | 1.92 | % | $ | 16,503 | $ | 4 | 0.12 | % | $ | 4 | $ | 110 | $ | 114 | |||||||||||||||||||||||||||||||||||
Money Market | 29,066 | 148 | 2.04 | 25,468 | 18 | 0.28 | 3 | 127 | 130 | ||||||||||||||||||||||||||||||||||||||||||||
Savings | 21,979 | 188 | 3.44 | 13,303 | 11 | 0.34 | 12 | 165 | 177 | ||||||||||||||||||||||||||||||||||||||||||||
Time deposits | 14,958 | 121 | 3.24 | 8,796 | 9 | 0.38 | 9 | 103 | 112 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 90,167 | 575 | 2.56 | 64,070 | 42 | 0.26 | 28 | 505 | 533 | ||||||||||||||||||||||||||||||||||||||||||||
Borrowings: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities sold under customer repurchase agreements | 456 | 1 | 0.31 | 627 | — | 0.16 | — | 1 | 1 | ||||||||||||||||||||||||||||||||||||||||||||
Short-term FHLB borrowings | 110 | 1 | 5.17 | — | — | — | 1 | — | 1 | ||||||||||||||||||||||||||||||||||||||||||||
Short-term borrowings | 566 | 2 | 1.26 | 627 | — | 0.16 | 1 | 1 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
FHLB borrowings | 5,558 | 74 | 5.35 | 386 | 2 | 1.64 | 62 | 10 | 72 | ||||||||||||||||||||||||||||||||||||||||||||
Senior unsecured borrowings | 798 | 4 | 2.11 | 894 | 4 | 2.05 | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Subordinated debt | 1,045 | 10 | 3.59 | 1,057 | 8 | 3.06 | — | 2 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
Other borrowings | 35,168 | 327 | 3.74 | 83 | 1 | 2.37 | 326 | — | 326 | ||||||||||||||||||||||||||||||||||||||||||||
Long-term borrowings | 42,569 | 415 | 3.91 | 2,420 | 15 | 2.43 | 388 | 12 | 400 | ||||||||||||||||||||||||||||||||||||||||||||
Total borrowings | 43,135 | 417 | 3.88 | 3,047 | 15 | 1.96 | 389 | 13 | 402 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | $ | 133,302 | $ | 992 | 2.98 | % | $ | 67,117 | $ | 57 | 0.34 | % | $ | 417 | $ | 518 | $ | 935 | |||||||||||||||||||||||||||||||||||
Noninterest-bearing deposits | $ | 47,241 | $ | 26,551 | |||||||||||||||||||||||||||||||||||||||||||||||||
Credit balances of factoring clients | 1,168 | 1,189 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other noninterest-bearing liabilities | 8,077 | 2,151 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' equity | 19,521 | 10,567 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 209,309 | $ | 107,575 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest rate spread (2) | 3.20 | % | 2.94 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
Net interest income and net yield on interest-earning assets (2) | $ | 1,961 | 4.10 | % | $ | 700 | 3.04 | % |
dollars in millions | Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2023 | June 30, 2022 | Change in NII Due to: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Average Balance | Income / Expense | Yield / Rate | Average Balance | Income / Expense | Yield / Rate | Volume(1) | Yield /Rate(1) | Total Change | |||||||||||||||||||||||||||||||||||||||||||||
Loans and leases (1)(2) | $ | 103,878 | $ | 3,370 | 6.53 | % | $ | 64,724 | $ | 1,276 | 3.96 | % | $ | 1,013 | $ | 1,081 | $ | 2,094 | |||||||||||||||||||||||||||||||||||
Investment securities | 19,612 | 224 | 2.29 | 19,338 | 172 | 1.78 | 2 | 50 | 52 | ||||||||||||||||||||||||||||||||||||||||||||
Securities purchased under agreements to resell | 96 | 3 | 4.92 | — | — | — | 3 | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Interest-earning deposits at banks | 22,884 | 567 | 4.99 | 9,542 | 19 | 0.40 | 60 | 488 | 548 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-earning assets (2) | $ | 146,470 | $ | 4,164 | 5.72 | % | $ | 93,604 | $ | 1,467 | 3.14 | % | $ | 1,078 | $ | 1,619 | $ | 2,697 | |||||||||||||||||||||||||||||||||||
Operating lease equipment, net | $ | 8,321 | $ | 7,949 | |||||||||||||||||||||||||||||||||||||||||||||||||
Cash and due from banks | 880 | 530 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses | (1,270) | (882) | |||||||||||||||||||||||||||||||||||||||||||||||||||
All other noninterest-earning assets | 8,593 | 7,776 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 162,994 | $ | 108,977 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest-bearing deposits | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Checking with interest | $ | 20,350 | $ | 140 | 1.35 | % | $ | 16,578 | $ | 9 | 0.11 | % | $ | 3 | $ | 128 | $ | 131 | |||||||||||||||||||||||||||||||||||
Money Market | 25,162 | 228 | 1.82 | 25,832 | 33 | 0.26 | (1) | 196 | 195 | ||||||||||||||||||||||||||||||||||||||||||||
Savings | 19,762 | 298 | 3.04 | 13,480 | 20 | 0.30 | 14 | 264 | 278 | ||||||||||||||||||||||||||||||||||||||||||||
Time deposits | 13,550 | 197 | 2.93 | 9,293 | 19 | 0.40 | 12 | 166 | 178 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 78,824 | 863 | 2.21 | 65,183 | 81 | 0.25 | 28 | 754 | 782 | ||||||||||||||||||||||||||||||||||||||||||||
Borrowings: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities sold under customer repurchase agreements | 456 | 1 | 0.31 | 614 | — | 0.16 | — | 1 | 1 | ||||||||||||||||||||||||||||||||||||||||||||
Short-term FHLB borrowings | 218 | 5 | 4.79 | — | — | — | 5 | — | 5 | ||||||||||||||||||||||||||||||||||||||||||||
Short-term borrowings | 674 | 6 | 1.76 | 614 | — | 0.16 | 5 | 1 | 6 | ||||||||||||||||||||||||||||||||||||||||||||
FHLB borrowings | 4,427 | 114 | 5.20 | 513 | 4 | 1.41 | 81 | 29 | 110 | ||||||||||||||||||||||||||||||||||||||||||||
Senior unsecured borrowings | 840 | 9 | 2.09 | 1,801 | 16 | 1.80 | (9) | 2 | (7) | ||||||||||||||||||||||||||||||||||||||||||||
Subordinated debt | 1,047 | 19 | 3.57 | 1,059 | 16 | 3.01 | — | 3 | 3 | ||||||||||||||||||||||||||||||||||||||||||||
Other borrowings | 18,665 | 342 | 3.70 | 84 | 1 | 2.20 | 340 | 1 | 341 | ||||||||||||||||||||||||||||||||||||||||||||
Long-term borrowings | 24,979 | 484 | 3.90 | 3,457 | 37 | 2.12 | 412 | 35 | 447 | ||||||||||||||||||||||||||||||||||||||||||||
Total borrowings | 25,653 | 490 | 3.85 | 4,071 | 37 | 2.12 | 417 | 36 | 453 | ||||||||||||||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | $ | 104,477 | $ | 1,353 | 2.61 | % | $ | 69,254 | $ | 118 | 0.34 | % | $ | 445 | $ | 790 | $ | 1,235 | |||||||||||||||||||||||||||||||||||
Noninterest-bearing deposits | $ | 36,919 | $ | 25,936 | |||||||||||||||||||||||||||||||||||||||||||||||||
Credit balances of factoring clients | 1,088 | 1,175 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Other noninterest-bearing liabilities | 5,065 | 2,117 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' equity | 15,445 | 10,495 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 162,994 | $ | 108,977 | |||||||||||||||||||||||||||||||||||||||||||||||||
Interest rate spread (2) | 3.11 | % | 2.80 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
Net interest income and net yield on interest-earning assets (2) | $ | 2,811 | 3.86 | % | $ | 1,349 | 2.89 | % |
% of Total Interest-earning Assets | |||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Loans and leases | 70 | % | 73 | % | 71 | % | 71 | % | 69 | % | |||||||||||||||||||
Investment securities | 10 | 19 | 21 | 13 | 21 | ||||||||||||||||||||||||
Securities purchased under agreements to resell | — | — | — | — | — | ||||||||||||||||||||||||
Interest-earning deposits at banks | 20 | 8 | 8 | 16 | 10 | ||||||||||||||||||||||||
Total interest earning assets | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % |
% of Total Interest-bearing Liabilities | |||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Total interest-bearing deposits | 68 | % | 89 | % | 95 | % | 75 | % | 94 | % | |||||||||||||||||||
Short-term borrowings | — | 1 | 1 | 1 | 1 | ||||||||||||||||||||||||
Long-term borrowings | 32 | 10 | 4 | 24 | 5 | ||||||||||||||||||||||||
100 | % | 100 | % | 100 | % | 100 | % | 100 | % |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Day 2 provision for loans and leases | $ | — | $ | 462 | $ | — | $ | 462 | $ | 454 | |||||||||||||||||||
Provision (benefit) for credit losses - loans and leases | 169 | 71 | 36 | 240 | (17) | ||||||||||||||||||||||||
Total provision for credit losses- loans and leases | 169 | 533 | 36 | 702 | 437 | ||||||||||||||||||||||||
Day 2 provision for unfunded commitments | — | 254 | — | 254 | 59 | ||||||||||||||||||||||||
(Benefit) provision for unfunded commitments | (17) | (8) | 6 | (25) | 10 | ||||||||||||||||||||||||
Total (benefit) provision for credit losses - unfunded commitments | (17) | 246 | 6 | 229 | 69 | ||||||||||||||||||||||||
(Benefit) provision for credit losses - investment securities available for sale | (1) | 4 | — | 3 | — | ||||||||||||||||||||||||
Provision for credit losses | $ | 151 | $ | 783 | $ | 42 | $ | 934 | $ | 506 |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Rental income on operating lease equipment | $ | 238 | $ | 233 | $ | 213 | $ | 471 | $ | 421 | |||||||||||||||||||
Other noninterest income: | |||||||||||||||||||||||||||||
Fee income and other service charges | 69 | 47 | 37 | 116 | 71 | ||||||||||||||||||||||||
Client investment fees | 52 | 2 | — | 54 | — | ||||||||||||||||||||||||
Wealth management services | 51 | 40 | 37 | 91 | 72 | ||||||||||||||||||||||||
International fees | 32 | 4 | 2 | 36 | 4 | ||||||||||||||||||||||||
Service charges on deposit accounts | 44 | 24 | 28 | 68 | 55 | ||||||||||||||||||||||||
Factoring commissions | 20 | 19 | 27 | 39 | 54 | ||||||||||||||||||||||||
Cardholder services, net | 41 | 21 | 26 | 62 | 51 | ||||||||||||||||||||||||
Merchant services, net | 14 | 10 | 9 | 24 | 19 | ||||||||||||||||||||||||
Insurance commissions | 14 | 13 | 11 | 27 | 23 | ||||||||||||||||||||||||
Realized loss on sale of investment securities available for sale, net | — | (14) | — | (14) | — | ||||||||||||||||||||||||
Fair value adjustment on marketable equity securities, net | (10) | (9) | (6) | (19) | (3) | ||||||||||||||||||||||||
Bank-owned life insurance | 2 | 5 | 9 | 7 | 17 | ||||||||||||||||||||||||
Gain on sale of leasing equipment, net | 4 | 4 | 5 | 8 | 11 | ||||||||||||||||||||||||
Gain on acquisition | 55 | 9,824 | — | 9,879 | 431 | ||||||||||||||||||||||||
Gain on extinguishment of debt | — | — | — | — | 6 | ||||||||||||||||||||||||
Other noninterest income | 32 | 36 | 26 | 68 | 42 | ||||||||||||||||||||||||
Total other noninterest income | 420 | 10,026 | 211 | 10,446 | 853 | ||||||||||||||||||||||||
Total noninterest income | $ | 658 | $ | 10,259 | $ | 424 | $ | 10,917 | $ | 1,274 |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Depreciation on operating lease equipment | $ | 91 | $ | 89 | $ | 89 | $ | 180 | $ | 170 | |||||||||||||||||||
Maintenance and other operating lease expenses | 56 | 56 | 47 | 112 | 90 | ||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||
Salaries and benefits | 775 | 420 | 345 | 1,195 | 701 | ||||||||||||||||||||||||
Net occupancy expense | 64 | 50 | 48 | 114 | 96 | ||||||||||||||||||||||||
Equipment expense | 133 | 58 | 54 | 191 | 106 | ||||||||||||||||||||||||
Professional fees | 21 | 11 | 11 | 32 | 23 | ||||||||||||||||||||||||
Third-party processing fees | 54 | 30 | 26 | 84 | 50 | ||||||||||||||||||||||||
FDIC insurance expense | 22 | 18 | 9 | 40 | 21 | ||||||||||||||||||||||||
Marketing expense | 41 | 15 | 9 | 56 | 17 | ||||||||||||||||||||||||
Acquisition-related expenses | 205 | 28 | 34 | 233 | 169 | ||||||||||||||||||||||||
Intangible asset amortization | 18 | 5 | 6 | 23 | 12 | ||||||||||||||||||||||||
Other noninterest expense | 92 | 75 | 67 | 167 | 100 | ||||||||||||||||||||||||
Total operating expenses | 1,425 | 710 | 609 | 2,135 | 1,295 | ||||||||||||||||||||||||
Total noninterest expense | $ | 1,572 | $ | 855 | $ | 745 | $ | 2,427 | $ | 1,555 | |||||||||||||||||||
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Income before income taxes | $ | 896 | $ | 9,471 | $ | 337 | $ | 10,367 | $ | 562 | |||||||||||||||||||
Income tax (benefit) expense | $ | 214 | $ | (47) | $ | 82 | $ | 167 | $ | 36 | |||||||||||||||||||
Effective tax rate | 23.9 | % | (0.5) | % | 24.2 | % | 1.6 | % | 6.3 | % |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
Earnings Summary | June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||
Net interest income | $ | 603 | $ | 560 | $ | 467 | $ | 1,163 | $ | 904 | |||||||||||||||||||
Provision (benefit) for credit losses | 29 | 14 | 7 | 43 | (8) | ||||||||||||||||||||||||
Net interest income after provision for credit losses | 574 | 546 | 460 | 1,120 | 912 | ||||||||||||||||||||||||
Noninterest income | 119 | 116 | 125 | 235 | 248 | ||||||||||||||||||||||||
Noninterest expense | 393 | 395 | 390 | 788 | 799 | ||||||||||||||||||||||||
Income before income taxes | 300 | 267 | 195 | 567 | 361 | ||||||||||||||||||||||||
Income tax expense | 73 | 65 | 40 | 138 | 80 | ||||||||||||||||||||||||
Net income | $ | 227 | $ | 202 | $ | 155 | $ | 429 | $ | 281 | |||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||
Loans and leases | $ | 44,719 | $ | 43,353 | $ | 40,159 | $ | 44,719 | $ | 40,159 | |||||||||||||||||||
Deposits | 95,323 | 85,982 | 83,518 | 95,323 | 83,518 | ||||||||||||||||||||||||
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
Earnings Summary | June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||
Net interest income | $ | 258 | $ | 240 | $ | 204 | $ | 498 | $ | 411 | |||||||||||||||||||
Provision for credit losses | 170 | 49 | 35 | 219 | 1 | ||||||||||||||||||||||||
Net interest income after provision for credit losses | 88 | 191 | 169 | 279 | 410 | ||||||||||||||||||||||||
Noninterest income | 139 | 143 | 130 | 282 | 242 | ||||||||||||||||||||||||
Noninterest expense | 188 | 211 | 180 | 399 | 371 | ||||||||||||||||||||||||
Income before income taxes | 39 | 123 | 119 | 162 | 281 | ||||||||||||||||||||||||
Income tax expense | 11 | 29 | 24 | 40 | 65 | ||||||||||||||||||||||||
Net income | $ | 28 | $ | 94 | $ | 95 | $ | 122 | $ | 216 | |||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||
Loans and leases | $ | 29,433 | $ | 28,684 | $ | 27,505 | $ | 29,433 | $ | 27,505 | |||||||||||||||||||
Deposits | 3,064 | 3,045 | 4,466 | 3,064 | 4,466 | ||||||||||||||||||||||||
Operating lease equipment, net | 741 | 719 | 724 | 741 | 724 |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
Earnings Summary | June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||
Net interest income | $ | 635 | $ | 65 | $ | — | $ | 700 | $ | — | |||||||||||||||||||
Benefit for credit losses | (47) | — | — | (47) | — | ||||||||||||||||||||||||
Net interest income after benefit for credit losses | 682 | 65 | — | 747 | — | ||||||||||||||||||||||||
Noninterest income | 169 | 14 | — | 183 | — | ||||||||||||||||||||||||
Noninterest expense | 592 | 33 | — | 625 | — | ||||||||||||||||||||||||
Income before income taxes | 259 | 46 | — | 305 | — | ||||||||||||||||||||||||
Income tax expense | 70 | 11 | — | 81 | — | ||||||||||||||||||||||||
Net income | $ | 189 | $ | 35 | $ | — | $ | 224 | $ | — | |||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||
Loans and leases | $ | 58,799 | $ | 66,171 | $ | — | $ | 58,799 | $ | — | |||||||||||||||||||
Deposits | 40,860 | 49,259 | — | 40,860 | — | ||||||||||||||||||||||||
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
Earnings Summary | June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||
Rental income on operating leases | $ | 180 | $ | 176 | $ | 160 | $ | 355 | $ | 319 | |||||||||||||||||||
Depreciation on operating lease equipment | 47 | 46 | 47 | 94 | 88 | ||||||||||||||||||||||||
Maintenance and other operating lease expenses | 56 | 56 | 47 | 112 | 90 | ||||||||||||||||||||||||
Adjusted rental income on operating lease equipment(1) | 77 | 74 | 66 | 149 | 141 | ||||||||||||||||||||||||
Interest expense, net | 33 | 28 | 18 | 61 | 37 | ||||||||||||||||||||||||
Other noninterest (expense) income | (2) | 1 | — | (1) | 3 | ||||||||||||||||||||||||
Operating expenses | 18 | 18 | 17 | 34 | 33 | ||||||||||||||||||||||||
Income before income taxes | 24 | 29 | 31 | 53 | 74 | ||||||||||||||||||||||||
Income tax expense | 6 | 7 | 7 | 13 | 18 | ||||||||||||||||||||||||
Net income | $ | 18 | $ | 22 | $ | 24 | $ | 40 | $ | 56 | |||||||||||||||||||
Select Period End Balances | |||||||||||||||||||||||||||||
Operating lease equipment, net | $ | 7,790 | $ | 7,612 | $ | 7,247 | $ | 7,790 | $ | 7,247 | |||||||||||||||||||
June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||
Railcar Type | Total Owned Fleet - % Total Units | Total Owned Fleet - % Total Net Investment | Total Owned Fleet - % Total Units | Total Owned Fleet - % Total Net Investment | Total Owned Fleet - % Total Units | Total Owned Fleet - % Total Net Investment | |||||||||||||||||||||||||||||
Covered Hoppers | 44 | % | 42 | % | 44 | % | 42 | % | 43 | % | 41 | % | |||||||||||||||||||||||
Tank Cars | 28 | 38 | 29 | 39 | 29 | 40 | |||||||||||||||||||||||||||||
Mill/Coil Gondolas | 8 | 7 | 8 | 6 | 8 | 6 | |||||||||||||||||||||||||||||
Coal | 8 | 1 | 8 | 1 | 8 | 1 | |||||||||||||||||||||||||||||
Boxcars | 6 | 6 | 6 | 6 | 6 | 6 | |||||||||||||||||||||||||||||
Other | 6 | 6 | 5 | 6 | 6 | 6 | |||||||||||||||||||||||||||||
Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Manufacturing | $ | 3,117 | 40 | % | $ | 3,073 | 40 | % | $ | 3,016 | 41 | % | |||||||||||||||||||||||
Rail | 1,960 | 25 | 1,958 | 26 | 1,981 | 27 | |||||||||||||||||||||||||||||
Wholesale | 1,171 | 15 | 1,137 | 15 | 1,101 | 15 | |||||||||||||||||||||||||||||
Oil and gas extraction / services | 596 | 8 | 593 | 8 | 552 | 7 | |||||||||||||||||||||||||||||
Energy and utilities | 235 | 3 | 242 | 3 | 242 | 3 | |||||||||||||||||||||||||||||
Other | 710 | 9 | 609 | 8 | 541 | 7 | |||||||||||||||||||||||||||||
Total | $ | 7,789 | 100 | % | $ | 7,612 | 100 | % | $ | 7,433 | 100 | % |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
Earnings Summary | June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||
Net interest income | $ | 498 | $ | 13 | $ | 47 | $ | 511 | $ | 71 | |||||||||||||||||||
(Benefit) provision for credit losses | (1) | 720 | — | 719 | 513 | ||||||||||||||||||||||||
Net interest income (expense) after provision for credit losses | 499 | (707) | 47 | (208) | (442) | ||||||||||||||||||||||||
Noninterest income | 53 | 9,809 | 9 | 9,862 | 462 | ||||||||||||||||||||||||
Noninterest expense | 278 | 96 | 64 | 374 | 174 | ||||||||||||||||||||||||
Income (loss) before income taxes | 274 | 9,006 | (8) | 9,280 | (154) | ||||||||||||||||||||||||
Income tax expense (benefit) | 54 | (159) | 11 | (105) | (127) | ||||||||||||||||||||||||
Net income (loss) | $ | 220 | $ | 9,165 | $ | (19) | $ | 9,385 | $ | (27) | |||||||||||||||||||
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Composition(1) | Amortized cost | Fair value | Composition(1) | Amortized cost | Fair value | Composition(1) | Amortized cost | Fair value | |||||||||||||||||||||||||||||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury | 22.5 | % | $ | 4,763 | $ | 4,634 | 10.9 | % | $ | 2,091 | $ | 1,978 | 10.6 | % | $ | 2,035 | $ | 1,898 | |||||||||||||||||||||||||||||||||||
Government agency | 0.7 | 143 | 140 | 0.8 | 152 | 150 | 0.9 | 164 | 162 | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 23.3 | 5,443 | 4,810 | 26.7 | 5,415 | 4,848 | 26.8 | 5,424 | 4,795 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 7.6 | 1,776 | 1,577 | 8.7 | 1,755 | 1,585 | 9.0 | 1,774 | 1,604 | ||||||||||||||||||||||||||||||||||||||||||||
Corporate bonds | 2.3 | 538 | 476 | 2.8 | 542 | 500 | 3.0 | 570 | 536 | ||||||||||||||||||||||||||||||||||||||||||||
Municipal bonds | 1.2 | 260 | 257 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Total investment securities available for sale | 57.6 | % | $ | 12,923 | $ | 11,894 | 49.9 | % | $ | 9,955 | $ | 9,061 | 50.3 | % | $ | 9,967 | $ | 8,995 | |||||||||||||||||||||||||||||||||||
Investment in marketable equity securities | 0.4 | % | $ | 75 | $ | 76 | 0.5 | % | $ | 75 | $ | 85 | 0.5 | % | $ | 75 | $ | 95 | |||||||||||||||||||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury | 2.1 | $ | 476 | $ | 426 | 2.4 | $ | 475 | $ | 433 | 2.4 | $ | 474 | $ | 424 | ||||||||||||||||||||||||||||||||||||||
Government agency | 6.5 | 1,502 | 1,328 | 7.7 | 1,550 | 1,387 | 7.6 | 1,548 | 1,362 | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 18.0 | 4,406 | 3,716 | 21.3 | 4,511 | 3,858 | 21.7 | 4,605 | 3,882 | ||||||||||||||||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 14.2 | 3,518 | 2,923 | 16.8 | 3,547 | 3,051 | 16.1 | 3,355 | 2,871 | ||||||||||||||||||||||||||||||||||||||||||||
Supranational securities | 1.2 | 297 | 257 | 1.4 | 296 | 262 | 1.4 | 295 | 254 | ||||||||||||||||||||||||||||||||||||||||||||
Other | — | 2 | 2 | — | 2 | 2 | — | 2 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
Total investment securities held to maturity | 42.0 | % | $ | 10,201 | $ | 8,652 | 49.6 | % | $ | 10,381 | $ | 8,993 | 49.2 | % | $ | 10,279 | $ | 8,795 | |||||||||||||||||||||||||||||||||||
Total investment securities | 100.0 | % | $ | 23,199 | $ | 20,622 | 100.0 | % | $ | 20,411 | $ | 18,139 | 100.0 | % | $ | 20,321 | $ | 17,885 | |||||||||||||||||||||||||||||||||||
(1) Calculated as a percentage of the total fair value of investment securities. |
June 30, 2023 | |||||||||||||||||||||||||||||
Within One Year | One to Five Years | Five to 10 Years | After 10 Years | Total | |||||||||||||||||||||||||
Investment securities available for sale: | |||||||||||||||||||||||||||||
U.S. Treasury | 4.97 | % | 0.98 | % | — | % | — | % | 3.46 | % | |||||||||||||||||||
Government agency | 3.83 | 4.92 | 4.90 | 5.39 | 4.93 | ||||||||||||||||||||||||
Residential mortgage-backed securities | 3.80 | 3.67 | 4.25 | 1.99 | 2.04 | ||||||||||||||||||||||||
Commercial mortgage-backed securities | 3.60 | 3.95 | 6.13 | 2.88 | 3.11 | ||||||||||||||||||||||||
Corporate bonds | 5.00 | 6.49 | 5.38 | 4.67 | 5.50 | ||||||||||||||||||||||||
Municipal bonds | 2.58 | 2.48 | 2.61 | 3.23 | 2.91 | ||||||||||||||||||||||||
Total investment securities available for sale | 4.95 | % | 1.71 | % | 4.91 | % | 2.20 | % | 2.91 | % | |||||||||||||||||||
Investment securities held to maturity: | |||||||||||||||||||||||||||||
U.S. Treasury | — | % | 1.37 | % | 1.57 | % | — | % | 1.38 | % | |||||||||||||||||||
Government agency | — | 1.39 | 1.84 | — | 1.53 | ||||||||||||||||||||||||
Residential mortgage-backed securities (1) | — | — | 2.62 | 1.89 | 1.89 | ||||||||||||||||||||||||
Commercial mortgage-backed securities (1) | — | 2.44 | 2.00 | 2.79 | 2.78 | ||||||||||||||||||||||||
Supranational Securities | — | 1.35 | 1.68 | — | 1.56 | ||||||||||||||||||||||||
Other | 1.52 | — | — | — | 1.52 | ||||||||||||||||||||||||
Total investment securities held to maturity | 1.52 | % | 1.39 | % | 1.78 | % | 2.29 | % | 2.11 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Loans and leases: | |||||||||||||||||
Commercial | $ | 62 | $ | 33 | $ | 48 | |||||||||||
Consumer | 42 | 9 | 4 | ||||||||||||||
SVB | 11 | 48 | — | ||||||||||||||
Loans and leases | 115 | 90 | 52 | ||||||||||||||
Operating lease equipment | 2 | 4 | 8 | ||||||||||||||
Total assets held for sale | $ | 117 | $ | 94 | $ | 60 |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Balance | % to Total Loans | Balance | % to Total Loans | Balance | % to Total Loans | ||||||||||||||||||||||||||||||
Commercial: | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | 3,182 | 2 | % | $ | 2,971 | 2 | % | $ | 2,804 | 4 | % | |||||||||||||||||||||||
Owner occupied commercial mortgage | 14,748 | 11 | 14,456 | 10 | 14,473 | 20 | |||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | 10,733 | 8 | 10,292 | 7 | 9,902 | 14 | |||||||||||||||||||||||||||||
Commercial and industrial | 25,376 | 19 | 24,508 | 18 | 24,105 | 34 | |||||||||||||||||||||||||||||
Leases | 2,130 | 2 | 2,163 | 2 | 2,171 | 3 | |||||||||||||||||||||||||||||
Total commercial | $ | 56,169 | 42 | % | $ | 54,390 | 39 | % | $ | 53,455 | 75 | % | |||||||||||||||||||||||
Consumer: | |||||||||||||||||||||||||||||||||||
Residential mortgage | $ | 14,065 | 11 | % | $ | 13,727 | 10 | % | $ | 13,309 | 19 | % | |||||||||||||||||||||||
Revolving mortgage | 1,900 | 1 | 1,916 | 1 | 1,951 | 3 | |||||||||||||||||||||||||||||
Consumer auto | 1,425 | 1 | 1,452 | 1 | 1,414 | 2 | |||||||||||||||||||||||||||||
Consumer other | 657 | 1 | 632 | 1 | 652 | 1 | |||||||||||||||||||||||||||||
Total consumer | $ | 18,047 | 14 | % | $ | 17,727 | 13 | % | $ | 17,326 | 25 | % | |||||||||||||||||||||||
Silicon Valley Banking: | |||||||||||||||||||||||||||||||||||
Global fund banking | $ | 29,333 | 22 | % | $ | 36,097 | 26 | % | $ | — | — | % | |||||||||||||||||||||||
Investor dependent - early stage | 1,840 | 1 | 1,994 | 1 | — | — | |||||||||||||||||||||||||||||
Investor dependent - growth stage | 4,052 | 3 | 4,418 | 3 | — | — | |||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | 8,905 | 7 | 9,193 | 7 | — | — | |||||||||||||||||||||||||||||
Private Bank | 9,580 | 7 | 9,476 | 7 | — | — | |||||||||||||||||||||||||||||
CRE | 2,530 | 2 | 2,444 | 2 | — | — | |||||||||||||||||||||||||||||
Other | 2,559 | 2 | 2,549 | 2 | — | — | |||||||||||||||||||||||||||||
Total Silicon Valley Banking | $ | 58,799 | 44 | % | $ | 66,171 | 48 | % | $ | — | — | % | |||||||||||||||||||||||
Total loans and leases | $ | 133,015 | 100 | % | $ | 138,288 | 100 | % | $ | 70,781 | 100 | % | |||||||||||||||||||||||
Less allowance for credit losses | (1,637) | (1,605) | (922) | ||||||||||||||||||||||||||||||||
Net loans and leases | $ | 131,378 | $ | 136,683 | $ | 69,859 |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Railcars and locomotives | $ | 7,790 | $ | 7,612 | $ | 7,433 | |||||||||||
Other equipment | 741 | 719 | 723 | ||||||||||||||
Total (1) | $ | 8,531 | $ | 8,331 | $ | 8,156 |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Noninterest-bearing demand | $ | 44,547 | $ | 54,649 | $ | 24,922 | |||||||||||
Checking with interest | 24,809 | 23,743 | 16,202 | ||||||||||||||
Money market | 29,149 | 30,598 | 21,040 | ||||||||||||||
Savings | 26,389 | 17,932 | 16,634 | ||||||||||||||
Time | 16,270 | 13,128 | 10,610 | ||||||||||||||
Total deposits | $ | 141,164 | $ | 140,050 | $ | 89,408 | |||||||||||
Noninterest-bearing deposits to total deposits | 31.6 | % | 39.0 | % | 27.9 | % |
dollars in millions | June 30, 2023 | ||||
Time deposits maturing in: | |||||
Three months or less | $ | 394 | |||
Over three months through six months | 1,457 | ||||
Over six months through 12 months | 2,033 | ||||
More than 12 months | 890 | ||||
Total | $ | 4,774 |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Securities sold under customer repurchase agreements | $ | 454 | $ | 509 | $ | 436 | |||||||||||
Federal Home Loan Bank borrowings (1) | |||||||||||||||||
Floating rate notes due through September 2025 | 2,425 | 8,500 | 4,250 | ||||||||||||||
Federal Deposit Insurance Corporation | |||||||||||||||||
3.500% fixed rate note due March 2028 (2) | 35,817 | 35,151 | — | ||||||||||||||
Senior Unsecured Borrowings | |||||||||||||||||
3.722% fixed line of credit due September 2023 | 15 | — | — | ||||||||||||||
3.929% fixed-to-floating rate notes due June 2024 | — | 502 | 505 | ||||||||||||||
2.969% fixed-to-floating rate notes due September 2025 | 319 | 320 | 320 | ||||||||||||||
6.000% fixed rate notes due April 2036 | 59 | 59 | 59 | ||||||||||||||
Subordinated debt | |||||||||||||||||
6.125% fixed rate notes due March 2028 | 463 | 466 | 469 | ||||||||||||||
4.125% fixed-to-fixed rate notes due November 2029 | 102 | 102 | 102 | ||||||||||||||
3.375% fixed-to-floating rate notes due March 2030 | 349 | 348 | 348 | ||||||||||||||
Macon Capital Trust I - floating rate debentures due March 2034 | 14 | 14 | 14 | ||||||||||||||
SCB Capital Trust I - floating rate debentures due April 2034 | 10 | 10 | 10 | ||||||||||||||
FCB/SC Capital Trust II - floating rate debentures due June 2034 | 18 | 18 | 18 | ||||||||||||||
FCB/NC Capital Trust III - floating rate debentures due June 2036 | 88 | 88 | 88 | ||||||||||||||
Total subordinated debt | 1,044 | 1,046 | 1,049 | ||||||||||||||
Other borrowings | 6 | 7 | 26 | ||||||||||||||
Total borrowings | $ | 40,139 | $ | 46,094 | $ | 6,645 |
dollars in millions | Three Months Ended June 30, 2023 | ||||||||||||||||||||||
Commercial | Consumer | SVB | Total | ||||||||||||||||||||
Balance at March 31, 2023 | $ | 800 | $ | 143 | $ | 662 | $ | 1,605 | |||||||||||||||
Initial PCD ACL | — | — | 20 | 20 | |||||||||||||||||||
Provision for credit losses - loans and leases | 172 | 16 | (19) | 169 | |||||||||||||||||||
Charge-offs | (69) | (6) | (101) | (176) | |||||||||||||||||||
Recoveries | 12 | 3 | 4 | 19 | |||||||||||||||||||
Balance at June 30, 2023 | $ | 915 | $ | 156 | $ | 566 | $ | 1,637 | |||||||||||||||
Annualized net charge-off ratio | 0.47 | % | |||||||||||||||||||||
Net charge-offs | $ | 57 | $ | 3 | $ | 97 | $ | 157 | |||||||||||||||
Average loans | $ | 134,634 | |||||||||||||||||||||
Percent of loans in each category to total loans | 42 | % | 14 | % | 44 | % | 100 | % | |||||||||||||||
Three Months Ended March 31, 2023 | |||||||||||||||||||||||
Commercial | Consumer | SVB | Total | ||||||||||||||||||||
Balance at December 31, 2022 | $ | 789 | $ | 133 | $ | — | $ | 922 | |||||||||||||||
Initial PCD ACL | — | — | 200 | 200 | |||||||||||||||||||
Day 2 provision for loans and leases | — | — | 462 | 462 | |||||||||||||||||||
Provision for credit losses - loans and leases | 58 | 13 | — | 71 | |||||||||||||||||||
Total provision for credit losses - loans and leases | 58 | 13 | 462 | 533 | |||||||||||||||||||
Charge-offs | (55) | (7) | — | (62) | |||||||||||||||||||
Recoveries | 8 | 4 | — | 12 | |||||||||||||||||||
Balance at March 31, 2023 | $ | 800 | $ | 143 | $ | 662 | $ | 1,605 | |||||||||||||||
Annualized net charge-off ratio | 0.27 | % | |||||||||||||||||||||
Net charge-offs | $ | 46 | $ | 4 | $ | — | $ | 50 | |||||||||||||||
Average loans | $ | 74,862 | |||||||||||||||||||||
Percent of loans in each category to total loans | 39 | % | 13 | % | 48 | % | 100 | % | |||||||||||||||
Three Months Ended June 30, 2022 | |||||||||||||||||||||||
Commercial | Consumer | SVB | Total | ||||||||||||||||||||
Balance at March 31, 2022 | $ | 743 | $ | 105 | $ | — | $ | 848 | |||||||||||||||
Initial PCD ACL | (12) | — | — | (12) | |||||||||||||||||||
Benefit for credit losses - loans and leases | 33 | 3 | — | 36 | |||||||||||||||||||
Charge-offs | (36) | (5) | — | (41) | |||||||||||||||||||
Recoveries | 12 | 7 | — | 19 | |||||||||||||||||||
Balance at June 30, 2022 | $ | 740 | $ | 110 | $ | — | $ | 850 | |||||||||||||||
Annualized net charge-off ratio | 0.13 | % | |||||||||||||||||||||
Net charge-offs (recoveries) | $ | 24 | $ | (2) | $ | — | $ | 22 | |||||||||||||||
Average loans | $ | 66,431 | |||||||||||||||||||||
Percent of loans in each category to total loans | 76 | % | 24 | % | — | % | 100 | % |
dollars in millions | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||
Commercial | Consumer | SVB | Total | Commercial | Consumer | SVB | Total | ||||||||||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 789 | $ | 133 | $ | — | $ | 922 | $ | 80 | $ | 98 | $ | — | $ | 178 | |||||||||||||||||||||||||||||||
Initial PCD ACL | — | — | 220 | 220 | 258 | 14 | — | 272 | |||||||||||||||||||||||||||||||||||||||
Day 2 provision for loans and leases | — | — | 462 | 462 | 432 | 22 | — | 454 | |||||||||||||||||||||||||||||||||||||||
Provision for credit losses - loans and leases | 230 | 29 | (19) | 240 | 10 | (27) | — | (17) | |||||||||||||||||||||||||||||||||||||||
Total provision for credit losses- loans and leases | 230 | 29 | 443 | 702 | 442 | (5) | — | 437 | |||||||||||||||||||||||||||||||||||||||
Charge-offs | (124) | (13) | (101) | (238) | (64) | (10) | — | (74) | |||||||||||||||||||||||||||||||||||||||
Recoveries | 20 | 7 | 4 | 31 | 24 | 13 | — | 37 | |||||||||||||||||||||||||||||||||||||||
Balance at end of period | $ | 915 | $ | 156 | $ | 566 | $ | 1,637 | $ | 740 | $ | 110 | $ | — | $ | 850 | |||||||||||||||||||||||||||||||
Annualized net charge-off ratio | 0.39 | % | 0.11 | % | |||||||||||||||||||||||||||||||||||||||||||
Net charge-offs (recoveries) | $ | 104 | $ | 6 | $ | 97 | $ | 207 | $ | 40 | $ | (3) | $ | — | $ | 37 | |||||||||||||||||||||||||||||||
Average loans | $ | 104,913 | $ | 65,810 | |||||||||||||||||||||||||||||||||||||||||||
Percent of loans in each category to total loans | 42 | % | 14 | % | 44 | % | 100 | % | 76 | % | 24 | % | — | % | 100 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Allowance for credit losses | $ | 1,637 | $ | 1,605 | $ | 922 | |||||||||||
Total loans and leases | 133,015 | 138,288 | 70,781 | ||||||||||||||
Allowance for credit losses to total loans and leases | 1.23 | % | 1.16 | % | 1.30 | % | |||||||||||
Commercial loans and leases: | |||||||||||||||||
Allowance for credit losses - commercial | $ | 915 | $ | 800 | $ | 789 | |||||||||||
Commercial loans and leases | 56,169 | 54,390 | 53,455 | ||||||||||||||
Commercial allowance for credit losses to commercial loans and leases | 1.63 | % | 1.47 | % | 1.48 | % | |||||||||||
Consumer loans: | |||||||||||||||||
Allowance for credit losses - consumer | $ | 156 | $ | 143 | $ | 133 | |||||||||||
Consumer loans | 18,047 | 17,727 | 17,326 | ||||||||||||||
Consumer allowance for credit losses to consumer loans | 0.86 | % | 0.80 | % | 0.77 | % | |||||||||||
SVB loans: | |||||||||||||||||
Allowance for credit losses - SVB | $ | 566 | $ | 662 | $ | — | |||||||||||
SVB loans | 58,799 | 66,171 | — | ||||||||||||||
SVB allowance for credit losses to SVB loans | 0.97 | % | 1.00 | % | — | % |
dollars in millions: | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Allowance for Credit Losses | Allowance for Credit Losses as a Percentage of Loans | Allowance for Credit Losses | Allowance for Credit Losses as a Percentage of Loans | Allowance for Credit Losses | Allowance for Credit Losses as a Percentage of Loans | ||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||
Commercial construction | $ | 45 | 1.42 | % | $ | 36 | 1.22 | % | $ | 40 | 1.43 | % | |||||||||||||||||||||||
Owner occupied commercial mortgage | 50 | 0.34 | 56 | 0.39 | 61 | 0.42 | |||||||||||||||||||||||||||||
Non-owner occupied commercial mortgage | 247 | 2.30 | 182 | 1.77 | 181 | 1.83 | |||||||||||||||||||||||||||||
Commercial and industrial | 533 | 2.10 | 490 | 2.00 | 476 | 1.98 | |||||||||||||||||||||||||||||
Leases | 40 | 1.86 | 36 | 1.69 | 31 | 1.41 | |||||||||||||||||||||||||||||
Total commercial | 915 | 1.63 | 800 | 1.47 | 789 | 1.48 | |||||||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||||||||
Residential mortgage | 90 | 0.64 | 81 | 0.59 | 74 | 0.55 | |||||||||||||||||||||||||||||
Revolving mortgage | 18 | 0.91 | 16 | 0.84 | 13 | 0.67 | |||||||||||||||||||||||||||||
Consumer auto | 5 | 0.33 | 5 | 0.35 | 5 | 0.37 | |||||||||||||||||||||||||||||
Consumer other | 43 | 6.56 | 41 | 6.42 | 41 | 6.32 | |||||||||||||||||||||||||||||
Total consumer | 156 | 0.86 | 143 | 0.80 | 133 | 0.77 | |||||||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||||||||
Global fund banking | 73 | 0.25 | 91 | 0.25 | — | — | |||||||||||||||||||||||||||||
Investor dependent - early stage | 106 | 5.79 | 130 | 6.53 | — | — | |||||||||||||||||||||||||||||
Investor dependent - growth stage | 175 | 4.31 | 175 | 3.97 | — | — | |||||||||||||||||||||||||||||
Innovation and cash flow dependent | 141 | 1.59 | 171 | 1.85 | — | — | |||||||||||||||||||||||||||||
Private Bank | 21 | 0.22 | 44 | 0.47 | — | — | |||||||||||||||||||||||||||||
CRE | 28 | 1.10 | 26 | 1.07 | — | — | |||||||||||||||||||||||||||||
Other | 22 | 0.88 | 25 | 0.98 | — | — | |||||||||||||||||||||||||||||
Total SVB | 566 | 0.97 | 662 | 1.00 | — | — | |||||||||||||||||||||||||||||
Total Allowance for Credit Losses | $ | 1,637 | 1.23 | % | $ | 1,605 | 1.16 | % | $ | 922 | 1.30 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Non-accrual loans: | |||||||||||||||||
Commercial loans | $ | 622 | $ | 510 | $ | 529 | |||||||||||
Consumer loans | 94 | 94 | 98 | ||||||||||||||
SVB loans | 213 | 224 | — | ||||||||||||||
Total non-accrual loans | 929 | 828 | 627 | ||||||||||||||
Other real estate owned and repossessed assets | 64 | 47 | 47 | ||||||||||||||
Total non-performing assets | $ | 993 | $ | 875 | $ | 674 | |||||||||||
Allowance for credit losses to total loans and leases: | 1.23 | % | 1.16 | % | 1.30 | % | |||||||||||
Ratio of total non-performing assets to total loans, leases, other real estate owned and repossessed assets | 0.75 | 0.63 | 0.95 | ||||||||||||||
Ratio of non-accrual loans and leases to total loans and leases | 0.70 | 0.60 | 0.89 | ||||||||||||||
Ratio of allowance for credit losses to non-accrual loans and leases | 176.33 | 193.76 | 146.88 |
dollars in millions | June 30, 2023 | ||||||||||
Net Investment | % of Total Loans and Leases | ||||||||||
Multi-Family | $ | 4,170 | 3.14 | % | |||||||
General Office | 2,800 | 2.11 | |||||||||
Medical Office | 2,814 | 2.12 | |||||||||
Industrial / Warehouse | 2,297 | 1.73 | |||||||||
Retail | 1,562 | 1.17 | |||||||||
Hotel / Motel | 765 | 0.58 | |||||||||
Other | 2,664 | 2.00 | |||||||||
Total | $ | 17,072 | 12.83 | % |
dollars in millions | June 30, 2023 | ||||
% of total loans and leases | 2.11 | % | |||
% of commercial real estate loans | 16.40 | % | |||
Average loan balance | $ | 2 | |||
Net charge-offs (%) | 0.61 | % | |||
Delinquencies as a % of total CRE loans | 7.38 | % | |||
Non-performing loans as a % of CRE loans | 8.96 | % | |||
ACL ratio | 4.44 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
State | |||||||||||||||||||||||||||||||||||
California | $ | 9,553 | 17.0 | % | $ | 9,279 | 17.1 | % | $ | 9,226 | 17.3 | % | |||||||||||||||||||||||
North Carolina | 9,138 | 16.3 | 8,795 | 16.2 | 8,699 | 16.3 | |||||||||||||||||||||||||||||
Texas | 3,899 | 6.9 | 3,586 | 6.6 | 3,624 | 6.8 | |||||||||||||||||||||||||||||
Florida | 3,566 | 6.3 | 3,398 | 6.2 | 3,273 | 6.1 | |||||||||||||||||||||||||||||
South Carolina | 3,170 | 5.7 | 3,076 | 5.7 | 3,142 | 5.9 | |||||||||||||||||||||||||||||
All other states | 25,203 | 44.9 | 24,796 | 45.6 | 24,243 | 45.4 | |||||||||||||||||||||||||||||
Total U.S. | $ | 54,529 | 97.1 | % | $ | 52,930 | 97.4 | % | $ | 52,207 | 97.8 | % | |||||||||||||||||||||||
Total International | 1,640 | 2.9 | 1,460 | 2.6 | 1,248 | 2.2 | |||||||||||||||||||||||||||||
Total | $ | 56,169 | 100.0 | % | $ | 54,390 | 100.0 | % | $ | 53,455 | 100.0 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Real Estate | $ | 12,600 | 22.4 | % | $ | 12,179 | 22.4 | % | $ | 11,684 | 21.9 | % | |||||||||||||||||||||||
Healthcare | 8,434 | 15.0 | 8,264 | 15.2 | 8,146 | 15.2 | |||||||||||||||||||||||||||||
Business Services | 6,041 | 10.8 | 5,656 | 10.4 | 5,518 | 10.3 | |||||||||||||||||||||||||||||
Transportation, Communication, Gas, Utilities | 5,375 | 9.6 | 5,120 | 9.4 | 5,002 | 9.4 | |||||||||||||||||||||||||||||
Manufacturing | 4,505 | 8.0 | 4,400 | 8.1 | 4,387 | 8.2 | |||||||||||||||||||||||||||||
Service Industries | 4,257 | 7.6 | 4,118 | 7.6 | 4,213 | 7.9 | |||||||||||||||||||||||||||||
Retail | 3,470 | 6.2 | 3,639 | 6.7 | 3,462 | 6.5 | |||||||||||||||||||||||||||||
Wholesale | 2,581 | 4.6 | 2,507 | 4.6 | 2,605 | 4.9 | |||||||||||||||||||||||||||||
Finance and Insurance | 2,494 | 4.4 | 2,521 | 4.6 | 2,604 | 4.9 | |||||||||||||||||||||||||||||
Other | 6,412 | 11.4 | 5,986 | 11.0 | 5,834 | 10.8 | |||||||||||||||||||||||||||||
Total | $ | 56,169 | 100.0 | % | $ | 54,390 | 100.0 | % | $ | 53,455 | 100.0 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||
Net Investment | % of Total | Net Investment | % of Total | Net Investment | % of Total | ||||||||||||||||||||||||||||||
State | |||||||||||||||||||||||||||||||||||
North Carolina | $ | 6,030 | 33.4 | % | $ | 5,830 | 32.9 | % | $ | 5,702 | 32.9 | % | |||||||||||||||||||||||
California | 4,142 | 23.0 | 4,001 | 22.6 | 4,014 | 23.2 | |||||||||||||||||||||||||||||
South Carolina | 3,144 | 17.4 | 3,079 | 17.3 | 3,001 | 17.3 | |||||||||||||||||||||||||||||
Other states | 4,731 | 26.2 | 4,817 | 27.2 | 4,609 | 26.6 | |||||||||||||||||||||||||||||
Total | $ | 18,047 | 100.0 | % | $ | 17,727 | 100.0 | % | $ | 17,326 | 100.0 | % |
dollars in millions | June 30, 2023 | March 31, 2023 | ||||||||||||
Private bank: | ||||||||||||||
Loans for personal residence | $ | 7,398 | $ | 7,355 | ||||||||||
Loans to eligible employees | 526 | 519 | ||||||||||||
Home equity lines of credit | 143 | 130 | ||||||||||||
Other | 107 | 117 | ||||||||||||
Total private bank loans secured by real estate | 8,174 | 8,121 | ||||||||||||
Commercial real estate ("CRE"): | ||||||||||||||
Multifamily and residential investment | 844 | 843 | ||||||||||||
Retail | 421 | 412 | ||||||||||||
Office and medical | 492 | 483 | ||||||||||||
Manufacturing, industrial and warehouse | 538 | 489 | ||||||||||||
Hospitality | 138 | 109 | ||||||||||||
Other | 97 | 108 | ||||||||||||
Total CRE loans secured by real estate | 2,530 | 2,444 | ||||||||||||
Premium wine | 874 | 913 | ||||||||||||
Other | 619 | 505 | ||||||||||||
Total real estate secured loans | $ | 12,197 | $ | 11,983 |
dollars in millions | Less Than $5 Million | $5 to < $10 Million | $10 to < $20 Million | $20 to < $30 Million | > $30 Million | Total SVB Loans | ||||||||||||||||||||||||||||||||
Global fund banking | $ | 1,133 | $ | 1,541 | $ | 2,623 | $ | 2,769 | $ | 21,267 | $ | 29,333 | ||||||||||||||||||||||||||
Investor dependent - early stage | 1,104 | 459 | 117 | 23 | 137 | 1,840 | ||||||||||||||||||||||||||||||||
Investor dependent - growth stage | 753 | 1,088 | 1,058 | 479 | 674 | 4,052 | ||||||||||||||||||||||||||||||||
Innovation C&I and cash flow dependent | 333 | 256 | 780 | 1,327 | 6,209 | 8,905 | ||||||||||||||||||||||||||||||||
Private Bank | 7,201 | 977 | 744 | 257 | 401 | 9,580 | ||||||||||||||||||||||||||||||||
CRE | 691 | 488 | 705 | 402 | 244 | 2,530 | ||||||||||||||||||||||||||||||||
Other | 482 | 489 | 741 | 609 | 238 | 2,559 | ||||||||||||||||||||||||||||||||
Total | $ | 11,697 | $ | 5,298 | $ | 6,768 | $ | 5,866 | $ | 29,170 | $ | 58,799 |
dollars in millions | June 30, 2023 | March 31, 2023 | |||||||||||||||||||||
State | |||||||||||||||||||||||
California | $ | 18,169 | 30.8 | % | $ | 19,936 | 30.1 | % | |||||||||||||||
Massachusetts | 8,831 | 15.0 | 9,658 | 14.6 | |||||||||||||||||||
New York | 8,640 | 14.7 | 10,094 | 15.3 | |||||||||||||||||||
Connecticut | 4,221 | 7.2 | 4,520 | 6.8 | |||||||||||||||||||
Texas | 4,207 | 7.2 | 4,578 | 6.9 | |||||||||||||||||||
All other states | 12,331 | 21.0 | 14,375 | 21.7 | |||||||||||||||||||
Total U.S. | 56,399 | 95.9 | 63,161 | 95.4 | |||||||||||||||||||
Total International | 2,400 | 4.1 | 3,010 | 4.6 | |||||||||||||||||||
Total | $ | 58,799 | 100.0 | % | $ | 66,171 | 100.0 | % |
Estimated (Decrease) Increase in NII | ||||||||||||||||||||
Change in interest rate (bps) | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||||
-100 | (9.7) | % | (11.1) | % | (4.0) | % | ||||||||||||||
-25 | (2.4) | (2.8) | (0.9) | |||||||||||||||||
+25 | 2.4 | 2.8 | 0.8 | |||||||||||||||||
+100 | 9.5 | 11.1 | 3.4 | |||||||||||||||||
+200 | 18.9 | 22.0 | 6.7 |
Estimated (Decrease) Increase in EVE | ||||||||||||||||||||
Change in interest rate (bps) | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||||
-100 | (5.0) | % | (6.1) | % | (5.3) | % | ||||||||||||||
-25 | (1.1) | (1.4) | (1.2) | |||||||||||||||||
+100 | 4.2 | 5.3 | 4.1 | |||||||||||||||||
+200 | 7.8 | 10.0 | 3.0 | |||||||||||||||||
dollars in millions | At June 30, 2023, Maturing | ||||||||||||||||||||||||||||
Within One Year | One to Five Years | Five to 15 Years | After 15 Years | Total | |||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||
Commercial construction | $ | 856 | $ | 1,482 | $ | 768 | $ | 76 | $ | 3,182 | |||||||||||||||||||
Owner occupied commercial mortgage | 653 | 4,454 | 9,068 | 573 | 14,748 | ||||||||||||||||||||||||
Non-owner occupied commercial mortgage | 2,277 | 6,027 | 2,004 | 425 | 10,733 | ||||||||||||||||||||||||
Commercial and industrial | 6,644 | 14,831 | 3,671 | 230 | 25,376 | ||||||||||||||||||||||||
Leases | 737 | 1,356 | 37 | — | 2,130 | ||||||||||||||||||||||||
Total commercial | 11,167 | 28,150 | 15,548 | 1,304 | 56,169 | ||||||||||||||||||||||||
Consumer | |||||||||||||||||||||||||||||
Residential mortgage | 116 | 595 | 2,331 | 11,023 | 14,065 | ||||||||||||||||||||||||
Revolving mortgage | 61 | 133 | 47 | 1,659 | 1,900 | ||||||||||||||||||||||||
Consumer auto | 12 | 715 | 698 | — | 1,425 | ||||||||||||||||||||||||
Consumer other | 310 | 187 | 123 | 37 | 657 | ||||||||||||||||||||||||
Total consumer | 499 | 1,630 | 3,199 | 12,719 | 18,047 | ||||||||||||||||||||||||
SVB | |||||||||||||||||||||||||||||
Global fund banking | 27,366 | 1,846 | 121 | — | 29,333 | ||||||||||||||||||||||||
Investor dependent - early stage | 293 | 1,480 | 67 | — | 1,840 | ||||||||||||||||||||||||
Investor dependent - growth stage | 362 | 3,578 | 112 | — | 4,052 | ||||||||||||||||||||||||
Innovation and cash flow dependent | 1,492 | 7,017 | 396 | — | 8,905 | ||||||||||||||||||||||||
Private Bank | 257 | 516 | 985 | 7,822 | 9,580 | ||||||||||||||||||||||||
CRE | 285 | 1,432 | 751 | 62 | 2,530 | ||||||||||||||||||||||||
Other | 423 | 757 | 835 | 544 | 2,559 | ||||||||||||||||||||||||
Total SVB | 30,478 | 16,626 | 3,267 | 8,428 | 58,799 | ||||||||||||||||||||||||
Total loans and leases | $ | 42,144 | $ | 46,406 | $ | 22,014 | $ | 22,451 | $ | 133,015 |
dollars in millions | Loans Maturing One Year or After with | ||||||||||
Fixed Interest Rates | Variable Interest Rates | ||||||||||
Commercial | |||||||||||
Commercial construction | $ | 942 | $ | 1,384 | |||||||
Owner occupied commercial mortgage | 12,570 | 1,525 | |||||||||
Non-owner occupied commercial mortgage | 3,479 | 4,977 | |||||||||
Commercial and industrial | 8,498 | 10,234 | |||||||||
Leases | 1,385 | 8 | |||||||||
Total commercial | 26,874 | 18,128 | |||||||||
Consumer | |||||||||||
Residential mortgage | 7,506 | 6,443 | |||||||||
Revolving mortgage | 33 | 1,806 | |||||||||
Consumer auto | 1,413 | — | |||||||||
Consumer other | 320 | 27 | |||||||||
Total consumer | 9,272 | 8,276 | |||||||||
SVB | |||||||||||
Global fund banking | 16 | 1,951 | |||||||||
Investor dependent - early stage | 23 | 1,524 | |||||||||
Investor dependent - growth stage | 6 | 3,684 | |||||||||
Innovation and cash flow dependent | — | 7,413 | |||||||||
Private Bank | 1,893 | 7,430 | |||||||||
CRE | 1,001 | 1,244 | |||||||||
Other | 1,426 | 710 | |||||||||
Total SVB | 4,365 | 23,956 | |||||||||
Total loans and leases | $ | 40,511 | $ | 50,360 |
dollars in millions | June 30, 2023 | ||||
Available Cash | $ | 37,152 | |||
High Quality Liquid Securities (1) | 16,269 | ||||
Liquid Assets | $ | 53,421 | |||
FDIC Credit Facility (2) | $ | 70,000 | |||
FHLB capacity (3) | 11,124 | ||||
FRB capacity | 4,817 | ||||
Line of credit | 85 | ||||
Total contingent sources | $ | 86,026 | |||
Total Liquid Assets and contingent sources | $ | 139,447 |
dollars in millions | June 30, 2023 | March 31, 2023 | December 31, 2022 | ||||||||||||||
Total | Total | Total | |||||||||||||||
Total borrowing capacity | $ | 14,999 | $ | 14,662 | $ | 14,918 | |||||||||||
Less: | |||||||||||||||||
Advances | 2,425 | 8,500 | 4,250 | ||||||||||||||
Letters of credit (1) | 1,450 | 1,450 | 1,450 | ||||||||||||||
Available capacity | $ | 11,124 | $ | 4,712 | $ | 9,218 | |||||||||||
Pledged non-PCD loans (contractual balance) | $ | 23,969 | $ | 23,743 | $ | 23,491 | |||||||||||
Weighted Average Rate | 5.40 | % | 5.21 | % | 3.28 | % |
dollars in millions | Payments Due by Period | ||||||||||||||||||||||||||||
Less than 1 year | 1-3 years | 4-5 years | Thereafter | Total | |||||||||||||||||||||||||
Contractual obligations: | |||||||||||||||||||||||||||||
Time deposits (1) | $ | 13,744 | $ | 2,328 | $ | 73 | $ | 125 | $ | 16,270 | |||||||||||||||||||
Short-term borrowings | 454 | — | — | — | 454 | ||||||||||||||||||||||||
Long-term borrowings (1)(2) | (23) | 2,665 | 36,405 | 638 | 39,685 | ||||||||||||||||||||||||
Total contractual obligations | $ | 14,175 | $ | 4,993 | $ | 36,478 | $ | 763 | $ | 56,409 | |||||||||||||||||||
Commitments: | |||||||||||||||||||||||||||||
Financing commitments | $ | 44,669 | $ | 13,554 | $ | 5,342 | $ | 5,727 | $ | 69,292 | |||||||||||||||||||
Letters of credit | 2,733 | 328 | 130 | 6 | 3,197 | ||||||||||||||||||||||||
Deferred purchase agreements | 1,531 | — | — | — | 1,531 | ||||||||||||||||||||||||
Purchase and funding commitments | 672 | — | — | — | 672 | ||||||||||||||||||||||||
Affordable housing partnerships (1) | 305 | 549 | 21 | 51 | 926 | ||||||||||||||||||||||||
Total commitments | $ | 49,910 | $ | 14,431 | $ | 5,493 | $ | 5,784 | $ | 75,618 |
Three Months Ended June 30, 2023 | Six Months Ended June 30, 2023 | |||||||||||||
Class A shares outstanding at beginning of period | 13,514,808 | 13,501,017 | ||||||||||||
Restricted stock units vested, net of shares held to cover taxes | 41 | 13,832 | ||||||||||||
Class A shares outstanding at end of period | 13,514,849 | 13,514,849 |
dollars in millions | Requirements to be Well-Capitalized | June 30, 2023 | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||||||||||||||||||
BancShares | |||||||||||||||||||||||||||||||||||||||||
Risk-based capital ratios | |||||||||||||||||||||||||||||||||||||||||
Total risk-based capital | 10.00 | % | $ | 22,504 | 15.84 | % | $ | 21,764 | 14.86 | % | $ | 11,799 | 13.18 | % | |||||||||||||||||||||||||||
Tier 1 risk-based capital | 8.00 | 19,898 | 14.00 | 19,225 | 13.13 | 9,902 | 11.06 | ||||||||||||||||||||||||||||||||||
Common equity Tier 1 | 6.50 | 19,017 | 13.38 | 18,344 | 12.53 | 9,021 | 10.08 | ||||||||||||||||||||||||||||||||||
Tier 1 leverage ratio | 5.00 | 19,898 | 9.50 | 19,225 | 16.72 | 9,902 | 8.99 | ||||||||||||||||||||||||||||||||||
FCB | |||||||||||||||||||||||||||||||||||||||||
Risk-based capital ratios | |||||||||||||||||||||||||||||||||||||||||
Total risk-based capital | 10.00 | % | $ | 22,292 | 15.69 | % | $ | 21,578 | 14.74 | % | $ | 11,627 | 12.99 | % | |||||||||||||||||||||||||||
Tier 1 risk-based capital | 8.00 | 20,142 | 14.18 | 19,495 | 13.32 | 10,186 | 11.38 | ||||||||||||||||||||||||||||||||||
Common equity Tier 1 | 6.50 | 20,142 | 14.18 | 19,495 | 13.32 | 10,186 | 11.38 | ||||||||||||||||||||||||||||||||||
Tier 1 leverage ratio | 5.00 | 20,142 | 9.62 | 19,495 | 16.97 | 10,186 | 9.25 |
Standard | Summary of Guidance | Effect on BancShares’ Financial Statements | ||||||
ASU 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting Issued March 2020 ASU 2021-01, Reference Rate Reform (Topic 848): Scope Issued January 2021 ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848 Issued December 2022 | The amendments in these updates apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. Allows entities to prospectively apply certain optional expedients for contract modifications and removes the requirements to remeasure contract modifications or de-designate hedging relationships. In addition, potential sources of ineffectiveness as a result of reference rate reform may be disregarded when performing certain effectiveness assessments. The main purpose of the practical expedients is to ease the administrative burden of accounting for contracts impacted by reference rate reform. ASU 2021-01 refines the scope of ASC 848 and clarifies which optional expedients may be applied to derivative instruments that do not reference LIBOR or a reference rate that is expected to be discontinued, but that are being modified in connection with the market-wide transition to new reference rates. ASU 2022-06 extends the period of time entities can utilize the reference rate reform relief guidance under ASU 2020-04 from December 31, 2022 to December 31, 2024. | BancShares continues to assess the impact of the optional expedients available through December 31, 2024 for eligible contract modifications and hedge relationships. The reference rate reform optional expedients have not yet been applied to any contracts and adoption of this guidance has not had, and is not expected to have, a material impact on the financial statements. | ||||||
ASU 2023-02 – Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method Issued March 2023 | The amendments in this update allow entities to elect to account for qualifying tax equity investments using the proportional amortization method (“PAM”), regardless of the program giving rise to the related income tax credits. PAM accounting had been available only for qualifying investments in qualified affordable housing projects. The guidance also requires disclosure of the nature of the investor’s tax equity investments and the effect of income tax credits and other income tax benefits from tax equity investments on the investor’s balance sheet and income statement. | Effective for BancShares as of January 1, 2024. Early adoption is permitted. BancShares does not expect the adoption of the update to have a material impact on our consolidated financial statements. | ||||||
ASU 2022-03 - Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions Issued June 2022 | The amendments in this update clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also require specific disclosures for equity securities subject to contractual sale restrictions. | Effective for BancShares as of January 1, 2024. Early adoption is permitted. BancShares does not expect the adoption of the update to have a material impact on our consolidated financial statements and related disclosures. |
dollars in millions | Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | |||||||||||||||||||||||||
Net income (GAAP) | $ | 18 | $ | 22 | $ | 24 | $ | 40 | $ | 56 | |||||||||||||||||||
Plus: Provision for income taxes | 6 | 7 | 7 | 13 | 18 | ||||||||||||||||||||||||
Plus: Other noninterest expense | 18 | 18 | 17 | 34 | 33 | ||||||||||||||||||||||||
Less: Other noninterest income | (2) | 1 | — | (1) | 3 | ||||||||||||||||||||||||
Plus: Interest expense, net | 33 | 28 | 18 | 61 | 37 | ||||||||||||||||||||||||
Adjusted rental income on operating lease equipment (non-GAAP) | $ | 77 | $ | 74 | $ | 66 | $ | 149 | $ | 141 |
2.1 | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 | ||||||||
32.2 | ||||||||
*101.INS | Inline XBRL Instance Document (filed herewith) | |||||||
*101.SCH | Inline XBRL Taxonomy Extension Schema (filed herewith) | |||||||
*101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase (filed herewith) | |||||||
*101.LAB | Inline XBRL Taxonomy Extension Label Linkbase (filed herewith) | |||||||
*101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase (filed herewith) | |||||||
*101.DEF | Inline XBRL Taxonomy Definition Linkbase (filed herewith) | |||||||
*104 | Cover Page Interactive Data File (embedded within the Inline XBRL document filed as Exhibit 101) | |||||||
* | Interactive data files are furnished but not filed for purposes of Sections 11 and 12 of the Securities Act of 1933, as amended, and Section 18 of the Securities Exchange Act of 1934, as amended. |
Date: | August 4, 2023 | FIRST CITIZENS BANCSHARES, INC. | ||||||||||||
(Registrant) | ||||||||||||||
By: | /s/ Craig L. Nix | |||||||||||||
Craig L. Nix | ||||||||||||||
Chief Financial Officer |
/s/ Frank B. Holding, Jr. | ||
Frank B. Holding, Jr. | ||
Chief Executive Officer |
/s/ Craig L. Nix | ||
Craig L. Nix | ||
Chief Financial Officer |
/s/ Frank B. Holding, Jr. | ||
Frank B. Holding, Jr. | ||
Chief Executive Officer |
/s/ Craig L. Nix | ||
Craig L. Nix | ||
Chief Financial Officer |
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Investment in marketable equity securities at cost | $ 75 | $ 75 |
Investment securities available for sale at cost | 12,923 | 9,967 |
Investment securities held to maturity at fair value | $ 8,652 | $ 8,795 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 10,000,000 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 32,000,000 | 16,000,000 |
Common stock, shares issued (in shares) | 13,514,849 | 13,501,017 |
Common stock, shares outstanding (in shares) | 13,514,849 | 13,501,017 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Common stock, shares issued (in shares) | 1,005,185 | 1,005,185 |
Common stock, shares outstanding (in shares) | 1,005,185 | 1,005,185 |
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 682 | $ 255 | $ 10,200 | $ 526 |
Other comprehensive loss, net of tax | ||||
Net unrealized loss on securities available for sale | (100) | (163) | (42) | (481) |
Net change in unrealized loss on securities available for sale transferred to securities held to maturity | 1 | 0 | 1 | 1 |
Net change in defined benefit pension items | (4) | 3 | 4 | 5 |
Other comprehensive loss, net of tax | (103) | (160) | (37) | (475) |
Total comprehensive income | $ 579 | $ 95 | $ 10,163 | $ 51 |
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Millions |
Total |
Class A Common Stock |
Class B Common Stock |
Series A Preferred Stock |
Series B Preferred Stock |
Series C Preferred Stock |
Preferred Stock |
Preferred Stock
Series B Preferred Stock
|
Preferred Stock
Series C Preferred Stock
|
Common Stock
Class A Common Stock
|
Common Stock
Class B Common Stock
|
Additional Paid in Capital |
Retained Earnings |
Retained Earnings
Class A Common Stock
|
Retained Earnings
Class B Common Stock
|
Retained Earnings
Series A Preferred Stock
|
Retained Earnings
Series B Preferred Stock
|
Retained Earnings
Series C Preferred Stock
|
Accumulated Other Comprehensive Loss |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Beginning balance, shareholders' equity at Dec. 31, 2021 | $ 4,738 | $ 340 | $ 9 | $ 1 | $ 0 | $ 4,378 | $ 10 | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net income | 526 | 526 | |||||||||||||||||
Other comprehensive loss, net of tax | (475) | (475) | |||||||||||||||||
Stock based compensation | 72 | 72 | |||||||||||||||||
Cash dividends declared | $ (14) | $ (1) | $ (14) | $ (1) | |||||||||||||||
Preferred stock dividends declared | $ (9) | $ (9) | $ (6) | $ (9) | $ (9) | $ (6) | |||||||||||||
Issued in CIT Merger: | 5,279 | 334 | 207 | $ 334 | $ 207 | 6 | 5,273 | ||||||||||||
Ending balance, shareholders' equity at Jun. 30, 2022 | 10,642 | 881 | 15 | 1 | 5,345 | 4,865 | (465) | ||||||||||||
Beginning balance, shareholders' equity at Mar. 31, 2022 | 10,570 | 881 | 15 | 1 | 5,344 | 4,634 | (305) | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net income | 255 | 255 | |||||||||||||||||
Other comprehensive loss, net of tax | (160) | (160) | |||||||||||||||||
Stock based compensation | 1 | 1 | |||||||||||||||||
Cash dividends declared | (7) | 0 | (7) | 0 | |||||||||||||||
Preferred stock dividends declared | (5) | (9) | (3) | (5) | (9) | (3) | |||||||||||||
Ending balance, shareholders' equity at Jun. 30, 2022 | 10,642 | 881 | 15 | 1 | 5,345 | 4,865 | (465) | ||||||||||||
Beginning balance, shareholders' equity at Dec. 31, 2022 | 9,662 | 881 | 14 | 1 | 4,109 | 5,392 | (735) | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net income | 10,200 | 10,200 | |||||||||||||||||
Other comprehensive loss, net of tax | (37) | (37) | |||||||||||||||||
Stock based compensation | (3) | (3) | |||||||||||||||||
Cash dividends declared | (20) | (2) | (20) | (2) | |||||||||||||||
Preferred stock dividends declared | (9) | (14) | (6) | (9) | (14) | (6) | |||||||||||||
Ending balance, shareholders' equity at Jun. 30, 2023 | 19,771 | 881 | 14 | 1 | 4,106 | 15,541 | (772) | ||||||||||||
Beginning balance, shareholders' equity at Mar. 31, 2023 | 19,216 | 881 | 14 | 1 | 4,104 | 14,885 | (669) | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||
Net income | 682 | 682 | |||||||||||||||||
Other comprehensive loss, net of tax | (103) | (103) | |||||||||||||||||
Stock based compensation | 2 | 2 | |||||||||||||||||
Cash dividends declared | $ (10) | $ (1) | $ (10) | $ (1) | |||||||||||||||
Preferred stock dividends declared | $ (5) | $ (7) | $ (3) | $ (5) | $ (7) | $ (3) | |||||||||||||
Ending balance, shareholders' equity at Jun. 30, 2023 | $ 19,771 | $ 881 | $ 14 | $ 1 | $ 4,106 | $ 15,541 | $ (772) |
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (Parenthetical) - $ / shares |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
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Statement of Stockholders' Equity [Abstract] | ||||
Common share cash dividends declared (in dollars per share) | $ 0.75 | $ 0.47 | $ 0.75 | $ 0.47 |
Significant Accounting Policies and Basis of Presentation |
6 Months Ended |
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Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies and Basis of Presentation | SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION Nature of Operations First Citizens BancShares, Inc. (the “Parent Company” and, when including all of its subsidiaries on a consolidated basis, “we,” “us,” “our,” “BancShares”) is a financial holding company organized under the laws of Delaware that conducts operations through its banking subsidiary, First-Citizens Bank & Trust Company (“FCB,” or the “Bank”), which is headquartered in Raleigh, North Carolina. BancShares and its subsidiaries operate a network of more than 560 branches in 23 states, predominantly located in the Southeast, Mid-Atlantic, Midwest and Western United States. BancShares provides various types of commercial and consumer banking services, including lending, leasing and wealth management services. Deposit services include checking, savings, money market and time deposit accounts. BASIS OF PRESENTATION Principles of Consolidation and Basis of Presentation These consolidated financial statements and notes thereto are presented in accordance with instructions for Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all information and notes necessary for a complete presentation of financial position, results of operations and cash flow activity required in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the consolidated financial position and consolidated results of operations have been made. The unaudited interim consolidated financial statements included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). Interim results are not necessarily indicative of results for a full year. The consolidated financial statements of BancShares include the accounts of BancShares and its subsidiaries, certain partnership interests and variable interest entities (“VIEs”) where BancShares is the primary beneficiary, if applicable. All significant intercompany accounts and transactions are eliminated upon consolidation. Assets held in agency or fiduciary capacity are not included in the consolidated financial statements. Reclassifications In certain instances, amounts reported in the 2022 consolidated financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had no effect on previously reported stockholders’ equity or net income. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions based on available information. These estimates and assumptions impact the amounts reported in the consolidated financial statements and accompanying notes and the disclosures provided, and actual results could differ from those estimates. The significant estimates related to the determination of the allowance for credit losses (“ACL”) and fair values of loans acquired in and the core deposit intangibles associated with a business combination are considered critical accounting estimates. Business Combinations BancShares accounts for all business combinations using the acquisition method of accounting. Under this method, acquired assets and assumed liabilities are included with the acquirer’s accounts at their estimated fair value as of the date of acquisition, with any excess of purchase price over the fair value of the net tangible and intangible assets acquired recognized as goodwill. To the extent the fair value of identifiable net assets acquired exceeds the purchase price, a gain on acquisition is recognized. Acquisition-related costs are recognized as period expenses as incurred. On March 27, 2023, FCB acquired substantially all loans and certain other assets and assumed all customer deposits and certain other liabilities, of Silicon Valley Bridge Bank, N.A. (“SVBB”) from the Federal Deposit Insurance Corporation (the “FDIC”) pursuant to the terms of a purchase and assumption agreement (the “SVBB Purchase Agreement”) by and among FCB, the FDIC and the FDIC, as receiver of SVBB (the “SVBB Acquisition”). On January 3, 2022 (the “CIT Merger Date”), BancShares completed its merger (the “CIT Merger”) with CIT Group Inc. (“CIT”), pursuant to an Agreement and Plan of Merger, dated as of October 15, 2020, as amended by Amendment No. 1, dated as of September 30, 2021 (as amended, the “CIT Merger Agreement”). Refer to Note 2 — Business Combinations for additional information. Reportable Segments As of December 31, 2022, BancShares reported its financial results in the following reportable segments: General Banking, Commercial Banking, Rail, and Corporate segments. During the first quarter of 2023, BancShares added the Silicon Valley Banking (“SVB”) reportable segment, which includes the assets acquired, liabilities assumed and related operations from the SVBB Acquisition. ACCOUNTING POLICIES Significant accounting policies are described in the 2022 Form 10-K. We have further described relevant updates to the significant accounting policies presented below. Securities Purchased Under Agreement to Resell Securities purchased under agreement to resell (“reverse repos”) are accounted for as collateralized financing transactions as the terms of such purchase agreements do not qualify for sale accounting and are therefore recorded at the amount of cash advanced. Accrued interest receivables are recorded in other assets. Interest earned is recorded in interest income. Assets Held for Sale Assets held for sale (“AHFS”) primarily consists of commercial loans carried at the lower of the cost or fair value (“LOCOM”) and residential mortgage loans carried at fair value. AHFS also includes operating lease equipment held for sale carried at LOCOM. Loans and Leases BancShares extends credit to commercial customers through a variety of financing arrangements including term loans, revolving credit facilities, finance leases and operating leases. BancShares also extends credit through consumer loans, including residential mortgages and auto loans. Our loan classes are further described in Note 1 — Significant Accounting Policies and Basis of Presentation in the 2022 Form 10-K. SVB Loan Classes SVB loan classes were added to reflect the loans acquired in the SVBB Acquisition. The SVB loan classes are described below. Global Fund Banking – Global fund banking is the largest class of SVB loans and consists of capital call lines of credit, the repayment of which is dependent on the payment of capital calls by the underlying limited partner investors in funds managed by certain private equity and venture capital firms. Investor Dependent – The investor dependent class includes loans made primarily to technology and life science/healthcare companies. These borrowers typically have modest or negative cash flows and rarely have an established record of profitable operations. Repayment of these loans may be dependent upon receipt by borrowers of additional equity financing from venture capital firms or other investors, or in some cases, a successful sale to a third party or an initial public offering (“IPO”). The investor dependent loans are disaggregated into two classes: •Early-Stage – These include loans to pre-revenue, development-stage companies and companies that are in the early phases of commercialization, with revenues of up to $5 million. •Growth Stage – These include loans to growth-stage enterprises. Companies with revenues between $5 million and $15 million, or pre-revenue clinical-stage biotechnology companies, are considered to be mid stage, and companies with revenues in excess of $15 million are considered to be later stage. Cash Flow Dependent and Innovation Commercial and Industrial (“C&I”) – Cash flow dependent and innovation C&I loans are made primarily to technology and life science/healthcare companies that are not investor dependent. Repayment of these loans is not dependent on additional equity financing, a successful sale or an IPO. •Cash Flow Dependent – Cash flow dependent loans are typically used to assist a select group of private equity sponsors with the acquisition of businesses, are larger in size and repayment is generally dependent upon the cash flows of the combined entities. Acquired companies are typically established, later-stage businesses of scale, and characterized by reasonable levels of leverage with loan structures that include meaningful financial covenants. The sponsor’s equity contribution is often 50 percent or more of the acquisition price. •Innovation C&I – These include loans in innovation sectors such as technology and life science/healthcare industries. Innovation C&I loans are dependent on either the borrower’s cash flows or balance sheet for repayment. Cash flow dependent loans require the borrower to maintain cash flow from operations that is sufficient to service all debt. Borrowers must demonstrate normalized cash flow in excess of all fixed charges associated with operating the business. Balance sheet dependent loans include asset-backed loans and are structured to require constant current asset coverage (e.g., cash, cash equivalents, accounts receivable and, to a much lesser extent, inventory) in an amount that exceeds the outstanding debt. The repayment of these arrangements is dependent on the financial condition, and payment ability, of third parties with whom our clients do business. Private Bank – Private banking includes loans to clients who are primarily private equity/venture capital professionals and executives in the innovation companies, as well as high net worth clients. We offer a customized suite of private banking services, including mortgages, home equity lines of credit, restricted and private stock loans, personal capital call lines of credit, lines of credit against liquid assets and other secured and unsecured lending products. In addition, we provide owner occupied commercial mortgages and real estate secured loans. Commercial Real Estate (“CRE”) – CRE consists generally of acquisition financing loans for commercial properties such as office buildings, retail properties, apartment buildings and industrial/warehouse space. Other – The remaining smaller acquired portfolios are aggregated into this category. These include other C&I, premium wine and other acquired portfolios. •Other C&I loans include working capital and revolving lines of credit, as well as term loans for equipment and fixed assets. These loans are primarily to clients that are not in the technology and life sciences/healthcare industries. Additionally, other C&I loans contain commercial tax-exempt loans to not-for-profit private schools, colleges, public charter schools and other not-for-profit organizations. •Premium wine loans are made to wine producers, vineyards and wine industry or hospitality businesses across the Western United States. A large portion of these loans are secured by real estate collateral such as vineyards and wineries. ▪Other acquired portfolios consist primarily of construction and land loans for financing new developments as well as financing for improvements to existing buildings. These also include community development loans made as part of our responsibilities under the Community Reinvestment Act of 1977, and a small amount of Paycheck Protection Program (“PPP”) loans, which are loans guaranteed by the SBA that were issued through the PPP. Acquired Loans and Leases BancShares’ accounting methods for acquired loans and leases depends on whether or not the loans reflect more than insignificant credit deterioration since origination at the date of acquisition. Non-Purchased Credit Deteriorated Loans and Leases Non-Purchased Credit Deteriorated (“Non-PCD”) loans and leases do not reflect more than insignificant credit deterioration since origination at the date of acquisition. These loans are recorded at fair value and an increase to the ACL is recorded with a corresponding increase to the provision for credit losses at the date of acquisition. The difference between the fair value and the unpaid principal balance (“UPB”) at the acquisition date is amortized or accreted to interest income over the contractual life of the loan using the effective interest method. Purchased Credit Deteriorated Loans and Leases Purchased loans and leases that reflect a more than insignificant credit deterioration since origination at the date of acquisition are classified as PCD loans and leases. PCD loans and leases are recorded at acquisition-date amortized cost, which is the purchase price or fair value in a business combination, plus BancShares' initial ACL, which results in a gross up of the loan balance (the “PCD Gross-Up”). The initial ACL for PCD loans and leases is established through the PCD Gross-Up and there is no corresponding increase to the provision for credit losses. The difference between the UPB and the acquisition date amortized cost resulting from the PCD Gross-Up is amortized or accreted to interest income over the contractual life of the loan using the effective interest method. Refer to Note 5 – Allowance for Credit Losses for additional information. Goodwill BancShares applied the acquisition method of accounting for the SVBB Acquisition and CIT Merger. The fair value of the net assets acquired exceeded the purchase price for each transaction. Consequently, there was a gain on acquisition (and no goodwill) related to the SVBB Acquisition and the CIT Merger. Refer to further discussion in Note 2 — Business Combinations and Note 7 — Goodwill and Core Deposit Intangibles. Derivative Assets and Liabilities Foreign Exchange Contracts SVB has foreign exchange forwards and swaps contracts with clients involved in foreign activities, either as the purchaser or seller, depending upon the clients’ needs. These are structured as back-to-back contracts to mitigate the risk of fluctuations in currency rates. The foreign exchange forward contracts are with correspondent banks to economically reduce our foreign exchange exposure related to certain foreign currency denominated instruments. Equity Warrant Assets In connection with negotiating credit facilities and certain other services, FCB may obtain rights that include an option to purchase a position in a client company's stock in the form of equity warrant assets in primarily private, venture-backed companies in the technology and life science/healthcare industries. These are generally categorized as Level 3 on the fair value hierarchy due to lack of direct observable pricing and a general lack of liquidity due to the private nature of the associated underlying company. Noninterest Income Refer to Note 1 — Significant Accounting Policies and Basis of Presentation in the 2022 Form 10-K for a discussion on revenue recognition and description of noninterest revenue-generating activities. Descriptions of significant noninterest income new to BancShares due to the SVBB Acquisition are summarized below. Client investment fees Client investment fees are earned from discretionary investment management and related transaction-based services. For discretionary investment management services, revenue is recognized monthly based on the clients’ assets under management. Transaction-based fees are earned on fixed income securities and repurchase agreements when transactions are executed. Amounts paid to third-party providers are not reflected in the transaction price because FCB is an agent for such services. International fees International fees primarily include foreign exchange fees. Foreign exchange fees represent the difference between foreign currency's purchase and sale price in spot contracts. These fees are recognized when contracts are executed with our clients. Fees related to other foreign exchange contracts are recognized outside the scope of Accounting Standards Codification (“ASC 606”) because they are considered derivatives. Newly Adopted Accounting Standards BancShares adopted the following accounting standards as of January 1, 2023: ASU 2022-02 Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures- Issued March 2022 (“ASU 2022-02”) The amendments in this ASU: (i) eliminate the previous recognition and measurement guidance for TDRs, (ii) require new disclosures for loan modifications when a borrower is experiencing financial difficulty (the “Modification Disclosures”) and (iii) require disclosures of current period gross charge-offs by year of origination in the vintage disclosures (the “Gross Charge-off Vintage Disclosures”). The Modification Disclosures apply to the following modification types: principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions, or a combination thereof. Creditors are required to disclose the following by loan class: (i) amounts and relative percentages of each modification type, (ii) the financial effect of each modification type, (iii) the performance of the loan in the 12 months following the modification and (iv) qualitative information discussing how the modifications factored into the determination of the ACL. BancShares elected to apply the modified retrospective transition method for ACL recognition and measurement. The adoption of this ASU did not result in a cumulative effect adjustment to retained earnings. The Modification Disclosures and Gross Charge-off Vintage Disclosures are applied prospectively starting in the period of adoption and are presented in Note 4 — Loans and Leases. ASU 2022-01, Fair Value Hedging - Portfolio Layer Method - Issued March 2022The amendments in this ASU allow entities to designate multiple hedged layers of a single closed portfolio and expands the scope of the portfolio layer method to include non-prepayable financial assets. The ASU provides additional guidance on the accounting for and disclosure of hedge basis adjustments under the portfolio layer method. In addition, upon adoption the update permits a one-time reclassification of certain debt securities from the held-to-maturity category to the available-for-sale category if the portfolio layer hedging method is applied to those securities. Upon adoption, we did not make any one-time reclassifications. Adoption of this ASU did not have a material impact on BancShares’ consolidated financial statements and disclosures as BancShares did not have any hedged portfolios.
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Business Combination and Asset Acquisition [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | BUSINESS COMBINATIONS Silicon Valley Bridge Bank Acquisition FCB completed the SVBB Acquisition on March 27, 2023 (the “SVBB Acquisition Date”) and acquired substantially all loans and certain other assets and assumed all customer deposits and certain other liabilities of SVBB in an FDIC-assisted transaction. BancShares has determined that the SVBB Acquisition constitutes a business combination as defined by the Financial Accounting Standards Board (“FASB”) ASC Topic 805, Business Combinations. Accordingly, the assets acquired and liabilities assumed are presented at their estimated fair values based on preliminary valuations as of March 27, 2023. The determination of estimated fair values required management to make certain estimates about discount rates, future expected cash flows, market conditions at the time of the SVBB Acquisition and other future events that are highly subjective in nature and may require adjustments. FCB and the FDIC are awaiting conclusion of the customary final settlement process to determine whether certain assets and liabilities of SVBB will remain with the FDIC or be acquired or assumed by FCB (“Final Settlement”). As a result of progress toward Final Settlement made during the second quarter of 2023, we acquired additional net assets with book values of $702 million, primarily consisting of investment securities and cash, and reflected a corresponding increase to the principal amount of the Purchase Money Note (as defined and described below). While substantial progress was made during the second quarter of 2023, certain items remain pending as of June 30, 2023. The pending items primarily include certain intangible assets of a SVBB subsidiary and remaining options for leased bank premises and related furniture and equipment. These pending items are not reflected in the “Purchase Price Consideration; Unaudited Statement of Assets Acquired and Liabilities Assumed” table below. We continue to review information relating to events or circumstances existing at the SVBB Acquisition Date that could impact the preliminary fair value estimates. Until management finalizes its fair value estimates for the acquired assets and assumed liabilities, the preliminary gain on acquisition can be updated for a period not to exceed one year following the SVBB Acquisition Date (the “Measurement Period”). We believe the preliminary fair value estimates of assets acquired and liabilities assumed, including the affects of Measurement Period adjustments through June 30, 2023, provide a reasonable basis for determining the preliminary gain on acquisition. The fair value measurements of loans, core deposit intangibles, low-income housing tax credits, unfunded commitments, premises and equipment, and intangibles related to the Shared-Loss Agreement (as defined below) are preliminary at June 30, 2023 as we identify and assess information regarding the nature of these assets and liabilities and review the associated valuation assumptions and methodologies. Further, as described above, whether certain assets and liabilities are acquired or assumed by FCB is subject to the conclusion of Final Settlement. The tax treatment of FDIC-assisted acquisitions is complex and subject to interpretations that may result in future adjustments of deferred taxes as of the SVBB Acquisition Date. As such, the amounts recorded for tax assets and liabilities are considered provisional as we continue to evaluate the nature and extent of permanent and temporary differences between the book and tax bases of the acquired assets and liabilities assumed, as well as the tax impact on the preliminary gain on acquisition. Pursuant to the terms of the SVBB Purchase Agreement, FCB acquired assets with an estimated total fair value of approximately $107.26 billion as of the SVBB Acquisition Date, primarily including $68.46 billion of loans, net of the initial ACL for PCD loans, and $35.31 billion of cash and interest-earning deposits at banks. FCB also assumed liabilities with an estimated total fair value of approximately $61.07 billion, primarily including $55.90 billion of customer deposits. The deposits were acquired without a premium and the assets were acquired at a discount of approximately $16.45 billion pursuant to the terms of the SVBB Purchase Agreement. Further details regarding the fair values of the acquired assets and assumed liabilities are provided in the “Purchase Price Consideration; Unaudited Statement of Assets Acquired and Liabilities Assumed” table below. In connection with the SVBB Acquisition, FCB issued a -year note of approximately $36 billion payable to the FDIC (the “Purchase Money Note”). The Purchase Money Note will be primarily secured by all loans (other than certain consumer loans and related collateral) and certain real estate and bank premises acquired by FCB from the FDIC, as well as certain other assets acquired, including specified rights under the SVBB Purchase Agreement and Shared-Loss Agreement. The interest rate is 3.50% per annum. FCB may prepay the principal of the Purchase Money Note at any time, without premium or penalty, upon notice to the FDIC. The principal amount of the Purchase Money Note is based on the book value of net assets acquired less the asset discount of $16.45 billion pursuant to the terms of the SVBB Purchase Agreement. The principal amount of the Purchase Money Note is subject to change upon Final Settlement (as defined and described above). In addition, as part of the consideration for the SVBB Acquisition, BancShares issued a Cash Settled Value Appreciation Instrument to the FDIC (the “Value Appreciation Instrument”) in which FCB agreed to make a cash payment to the FDIC equal to the product of (i) 5 million and (ii) the excess amount by which the average volume weighted price of one share of BancShares’ Class A common stock, par value $1 (“Class A Common Stock”), over the Nasdaq trading days immediately prior to the date on which the Value Appreciation Instrument is exercised exceeds $582.55; provided that the settlement amount does not exceed $500 million. The Value Appreciation Instrument was exercisable by the holder thereof, in whole or in part, from and including March 27, 2023 to April 14, 2023. The FDIC exercised its right under the Value Appreciation Instrument on March 28, 2023 and a $500 million payment was made on April 4, 2023. FCB and the FDIC also entered into terms and conditions for a -year, up to $70 billion line of credit to FCB (the “Credit Facility”) provided by the FDIC. During the two-year period following the SVBB Acquisition Date, FCB may draw on the Credit Facility to support liquidity, including for deposit withdrawal or runoff and to fund the unfunded commercial lending commitments acquired in the SVBB Acquisition (the “Acquired Unfunded Commitments”). The Credit Facility is secured by the loans and other extensions of credit acquired pursuant to the SVBB Acquisition, including Acquired Unfunded Commitments subsequently funded by FCB. Interest on outstanding principal will accrue at a variable rate equal to the Secured Overnight Financing Rate (“SOFR”) plus 25 basis points (but in no event less than 0.00%). In connection with the SVBB Purchase Agreement, FCB also entered into a commercial shared loss agreement with the FDIC (the “Shared-Loss Agreement”). The Shared-Loss Agreement covers an estimated $60 billion of commercial loans (collectively, the “Covered Assets”). The FDIC will reimburse FCB for 0% of losses of up to $5 billion with respect to Covered Assets and 50% of losses in excess of $5 billion with respect to Covered Assets (“FDIC Loss Sharing”) and FCB will reimburse the FDIC for 50% of recoveries related to such Covered Assets (“FCB reimbursement”). The Shared-Loss Agreement provides for FDIC loss sharing for five years and FCB reimbursement for eight years. The Shared-Loss Agreement extends to loans funded after the SVBB Acquisition Date that were unfunded commitments to loans at the SVBB Acquisition Date for a period of one year after the SVBB Acquisition Date. If certain conditions are met pursuant to the Shared-Loss Agreement, FCB has agreed to pay to the FDIC, 45 days after March 31, 2031 (or, if earlier, the time of disposition of all acquired assets pursuant to the Shared-Loss Agreement), a true-up amount up to $1.5 billion calculated using a formula set forth in the Shared-Loss Agreement. The following tables provide the purchase price allocation to the identifiable assets acquired and liabilities assumed at their estimated fair values as of the SVBB Acquisition Date. The amounts below reflect Measurement Period adjustments made during the second quarter of 2023, which increased the preliminary after tax gain on acquisition by $55 million. These Measurement Period adjustments primarily relate to refined fair value estimates for acquired affordable housing tax credit investments, loans, and assets and liabilities of acquired SVBB subsidiaries. Purchase Price Consideration; Unaudited Statement of Assets Acquired and Liabilities Assumed
(1) The principal amount of the Purchase Money Note is the book value of net assets acquired of approximately $52.522 billion less the asset discount of $16.450 billion pursuant to the SVBB Purchase Agreement. The $35.808 billion above is net of a fair value discount of approximately $264 million. (2) The difference between the preliminary gain on acquisition before and after taxes reflects the deferred tax liabilities recorded in the SVBB Acquisition, as presented above. The preliminary gain on acquisition of $9.88 billion included in noninterest income represents the excess of the fair value of net assets acquired over the purchase price. The following is a description of the methods used to determine the estimated fair values of the Purchase Money Note and significant assets acquired and liabilities assumed, as presented above. Purchase Money Note The fair value of the Purchase Money Note was estimated based on the income approach, which includes: (i) projecting cash flows over a certain discrete projection period and (ii) discounting those projected cash flows to present value at a rate of return that considers the relative risk of the cash flows and the time value of money. Cash and interest-earning deposits at banks For financial instruments with a short-term or no stated maturity, prevailing market rates and limited credit risk, carrying amounts approximate fair value. Investment Securities Fair values for securities are based on quoted market prices, where available. If quoted market prices are not available, fair value estimates are based on observable inputs including quoted market prices for similar instruments, quoted market prices that are not in an active market or other inputs that are observable in the market. In the absence of observable inputs, fair value is estimated based on pricing models and/or discounted cash flow methodologies. Loans Fair values for loans were based on a discounted cash flow methodology that considered factors including the type of loan and related collateral, classification status, fixed or variable interest rate, remaining term of loan, credit quality ratings or scores, amortization status and current discount rate. Loans with similar risk characteristics were pooled together and treated in aggregate when applying various valuation techniques. The discount rates used for loans were based on an evaluation of current market rates for new originations of comparable loans and required rates of return for market participants to purchase similar assets, including adjustments for liquidity and credit quality when necessary. BancShares’ accounting methods for acquired Non-PCD and PCD loans and leases are discussed in Note 1 — Significant Accounting Policies and Basis of Presentation. The following table presents the UPB and fair value of the loans and leases acquired by BancShares in the SVBB Acquisition as of the SVBB Acquisition Date. The fair value of Non-PCD loans and leases was $66.42 billion, compared to the UPB of $68.73 billion, resulting in a discount of $2.31 billion that will be accreted into income over the contractual life of the loan using the effective interest method. Loans and Leases Acquired
The following table summarizes PCD loans and leases that BancShares acquired in the SVBB Acquisition. PCD Loans and Leases
(2) The non-credit discount of $302 million will be accreted into income over the contractual life of the loan using the effective interest method. Affordable housing tax credit investments The fair values of the affordable housing tax credit investments were determined based on discounted cash flows. The cash flow projections considered tax credits and net cash flows from operating losses and tax depreciation. The discount rate was determined using observable market data points for similar investments. Premises and equipment Fair values for furniture and fixtures, computer software and other equipment were determined using the cost approach. Core deposit intangibles The following table presents the intangible asset recorded related to the valuation of core deposits: Intangible Asset
Certain core deposits were acquired as part of the SVBB Acquisition, which provide an additional source of funds for BancShares. The core deposit intangible represents the costs saved by BancShares by acquiring the core deposits rather than sourcing the funds elsewhere. This intangible was valued using the after-tax cost savings method under the income approach. This method estimates the fair value by discounting to present value the favorable funding spread attributable to the core deposit balances over their estimated average remaining life. The valuation considered a dynamic approach to interest rates and alternative cost of funds. The favorable funding spread is calculated as the difference in the alternative cost of funds and the net deposit cost. Refer to further discussion in Note 7 — Goodwill and Core Deposit Intangibles. Other assets The following table details other assets acquired: Other Assets
The fair values of the derivative assets in the table above and derivative liabilities in the table below were valued using prices of financial instruments with similar characteristics and observable inputs. The fair value of accrued interest receivable and the remaining other assets was determined to approximate book value. Refer to further discussion in Note 12 — Derivative Financial Instruments and Note 14 — Fair Value. Deposits Acquired deposits were essentially all transactional deposits. Thus, we determined carrying amounts approximate fair value. Deferred Tax liability The SVBB Acquisition is an asset acquisition for tax purposes and is therefore considered a taxable transaction. The deferred tax liability (“DTL”) for the SVBB Acquisition was calculated by applying FCB’s deferred tax rate to the book and tax basis differences on the SVBB Acquisition Date for acquired assets and assumed liabilities. Deferred taxes were not recorded for the affordable housing tax credit investments in accordance with the proportional amortization method. Other liabilities The following table details other liabilities assumed:
The fair value of the liability representing our commitment for future capital contributions to the affordable housing tax credit investments was determined based on discounted cash flows. Projected cash flows for future capital contributions were discounted at a rate that represented FCB’s cost of debt. Shared-Loss Agreement Intangibles Preliminary estimates indicate there is no material value to attribute to the loss indemnification asset or true-up liability. This is primarily based on evaluation of historical loss experience and the credit quality of the portfolio. Unaudited Pro Forma Information - SVBB Acquisition The amount of net interest income, noninterest income and net income of $700 million, $183 million and $224 million, respectively, attributable to the SVBB Acquisition were included in BancShares’ Consolidated Statement of Income for the six months ended June 30, 2023. SVBB’s net interest income, noninterest income and net income noted above reflect management’s best estimates, based on information available at the reporting date. SVBB was only in operation from March 10 to March 27, 2023 and does not have historical financial information on which we could base pro forma information. Additionally, we did not acquire all assets or assume all liabilities of SVBB and an essential part of the SVBB Acquisition is the federal assistance governed by the SVBB Purchase Agreement and Shared-Loss Agreement, which is not reflected in the previous operations of SVBB. Therefore, it is impracticable to provide pro forma information on revenues and earnings for the SVBB Acquisition in accordance with ASC 805-10-50-2. CIT Group Inc. BancShares completed the CIT Merger on January 3, 2022 (the “Merger Date”). Pursuant to the CIT Merger Agreement, each share of CIT common stock, par value $0.01 per share (“CIT Common Stock”), issued and outstanding, except for certain shares of CIT Common Stock owned by CIT or BancShares, was converted into the right to receive 0.062 shares of Class A Common Stock, plus cash in lieu of fractional shares of Class A Common Stock. The Parent Company issued approximately 6.1 million shares of Class A Common Stock in connection with the consummation of the CIT Merger. The CIT Merger has been accounted for as a business combination under the acquisition method of accounting. Accordingly, the assets acquired and liabilities assumed were recorded at their estimated fair values as of the Merger Date. The determination of estimated fair values required management to make certain estimates about discount rates, future expected cash flows, market conditions at the time of the merger and other future events that are highly subjective in nature and may require adjustments. The following table provides the purchase price allocation to the identifiable assets acquired and liabilities assumed at their estimated fair values as of the Merger Date: Purchase Price Consideration and Net Assets Acquired
BancShares recorded a gain on acquisition of $431 million in noninterest income, representing the excess of the fair value of net assets acquired over the purchase price. The gain on acquisition was not taxable. For a description of the fair value and unpaid principal balance of loans from the CIT Merger, as well as the methods used to determine the fair values of significant assets and liabilities, see Note 2 — Business Combinations in Item 8 of our 2022 Form 10-K.
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Investment Securities |
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Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment Securities | INVESTMENT SECURITIES The following tables include the amortized cost and fair value of investment securities at June 30, 2023 and December 31, 2022. Amortized Cost and Fair Value - Investment Securities
Investments in residential and commercial mortgage-backed securities represent securities issued by the Government National Mortgage Association, Federal National Mortgage Association and Federal Home Loan Mortgage Corporation. U.S. Treasury investments represents T-bills and Notes issued by the U.S. Treasury. Investments in government agency securities represent securities issued by the Small Business Association (“SBA”), Federal Home Loan Bank (“FHLB”) and other agencies. Investments in corporate bonds represent positions in debt securities of other financial institutions. Municipal bonds are general obligation bonds that were acquired in the SVBB Acquisition. Investments in supranational securities represent securities issued by the Supranational Entities and Multilateral Development Banks. Investments in marketable equity securities represent positions in common stock of publicly traded financial institutions. Other held to maturity investments include certificates of deposit with other financial institutions. BancShares also holds approximately 354,000 shares of Class B common stock of Visa, Inc. (“Visa”). Until the resolution of certain litigation, at which time the Visa Class B common stock will convert to publicly traded Visa Class A common stock, these shares are only transferable to other stockholders of Visa Class B common stock. As a result, there is limited transfer activity in private transactions between buyers and sellers. Given this limited trading activity and the continuing uncertainty regarding the likelihood, ultimate timing and eventual exchange rate for shares of Visa Class B common stock into shares of Visa Class A common stock, these shares are not considered to have a readily determinable fair value and have no carrying value. BancShares continues to monitor the trading activity in Visa Class B common stock and the status of the resolution of certain litigation matters at Visa that would trigger the conversion of the Visa Class B common stock into Visa Class A common stock. Accrued interest receivables for available for sale and held to maturity debt securities were excluded from the estimate for credit losses. At June 30, 2023, accrued interest receivables for available for sale and held to maturity debt securities were $35 million and $18 million, respectively. At December 31, 2022, accrued interest receivables for available for sale and held to maturity debt securities were $33 million and $19 million, respectively. During the three and six months ended June 30, 2023 and 2022, there was no accrued interest that was deemed uncollectible and written off against interest income. The following table provides the amortized cost and fair value by contractual maturity. Expected maturities will differ from contractual maturities on certain securities because borrowers and issuers may have the right to call or prepay obligations with or without prepayment penalties. Residential and commercial mortgage-backed and government agency securities are stated separately as they are not due at a single maturity date. Maturities - Debt Securities
(1) Balances as of June 30, 2023 are presented net of the allowance for credit losses of $3 million. The following table presents interest and dividend income on investment securities: Interest and Dividends on Investment Securities
The following table presents the gross realized losses on the sales of investment securities available for sale: Realized Losses on Debt Securities Available For Sale
The following table provides the fair value adjustment on marketable equity securities: Fair Value Adjustment on Marketable Equity Securities
The following table provides information regarding investment securities available for sale with unrealized losses: Gross Unrealized Losses on Debt Securities Available For Sale
(1) Balances as of June 30, 2023 are presented net of the allowance for credit losses of $3 million. As of June 30, 2023, there were 389 investment securities available for sale with continuous unrealized losses for more than 12 months, of which 345 were government sponsored enterprise-issued mortgage-backed securities, government agency securities, or U.S. treasury securities and the remaining 44 were corporate bonds. BancShares has the ability and intent to retain these securities for a period of time sufficient to recover all unrealized losses. Given the consistently strong credit rating of the U.S. Treasury, and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, as of June 30, 2023, no ACL was required. For corporate bonds and municipal bonds, we analyzed the changes in interest rates relative to when the investment securities were purchased or acquired, and considered other factors including changes in credit ratings, delinquencies, and other macroeconomic factors. As a result of this analysis, we determined that three corporate bonds carry credit-related losses of $3 million as of June 30, 2023, which is reflected in the provision for credit losses as presented in Note 5 — Allowance for Credit Losses. BancShares’ portfolio of held to maturity debt securities consists of mortgage-backed securities issued by government agencies and government sponsored entities, U.S. Treasury notes, unsecured bonds issued by government agencies and government sponsored entities, and securities issued by the Supranational Entities and Multilateral Development Banks. Given the consistently strong credit rating of the U.S. Treasury, the Supranational Entities and Multilateral Development Banks and the long history of no credit losses on debt securities issued by government agencies and government sponsored entities, as of June 30, 2023, no ACL was required for held to maturity debt securities. Investment securities having an aggregate carrying value of $4.03 billion at June 30, 2023, and $4.20 billion at December 31, 2022, were pledged as collateral to secure public funds on deposit and certain short-term borrowings, and for other purposes as required by law. A security is considered past due once it is 30 days contractually past due under the terms of the agreement. There were no securities past due as of June 30, 2023 or December 31, 2022. There were no debt securities held to maturity on non-accrual status as of June 30, 2023 or December 31, 2022. Certain investments held by BancShares were recorded in other assets. BancShares held FHLB stock of $119 million and $197 million at June 30, 2023 and December 31, 2022, respectively; these securities are recorded at cost. BancShares held $58 million and $58 million of nonmarketable securities without readily determinable fair values, which are measured at cost at June 30, 2023 and December 31, 2022, respectively. Investments in qualified affordable housing projects, all of which are accounted for under the proportional amortization method were $1.81 billion and $598 million at June 30, 2023 and December 31, 2022, respectively.
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Loans and Leases |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Leases | LOANS AND LEASES Unless otherwise noted, loans held for sale are not included in the following tables. Leases in the following tables include finance leases, but exclude operating lease equipment. As disclosed in Note 2 — Business Combinations, the following tables and text data as of June 30, 2023 include loans acquired in the SVBB Acquisition. Loans by Class
At June 30, 2023 and December 31, 2022, accrued interest receivable on loans included in other assets was $601 million and $203 million, respectively, and was excluded from the estimate of credit losses. There was a discount on acquired loans because the fair value was lower than the UPB as further discussed in Note 2 — Business Combinations. The discount on acquired loans is accreted to interest income over the contractual life of the loan using the effective interest method as further discussed in Note 1 — Significant Accounting Policies and Basis of Presentation. Accretion for the discount on acquired loans was $243 million and $260 million for the three and six months ended June 30, 2023, respectively. The following table presents selected components of the amortized cost of loans, including the unamortized discount on acquired loans. Components of Amortized Cost
The aging of the outstanding loans and leases by class at June 30, 2023 and December 31, 2022 is provided in the tables below. Loans and leases less than 30 days past due are considered current, as various grace periods allow borrowers to make payments within a stated period after the due date and remain in compliance with the respective agreement. Loans and Leases - Delinquency Status
The amortized cost by class of loans and leases on non-accrual status, and loans and leases greater than 90 days past due and still accruing at June 30, 2023 and December 31, 2022 are presented below. Loans on Non-Accrual Status (1) (2)
(1) Accrued interest that was reversed when the loan went to non-accrual status was $5 million for the six months ended June 30, 2023 and $4 million for the year ended December 31, 2022. (2) Non-accrual loans for which there was no related ACL totaled $74 million at June 30, 2023 and $63 million at December 31, 2022. Other real estate owned (“OREO”) and repossessed assets were $64 million as of June 30, 2023 and $47 million as of December 31, 2022. Credit Quality Indicators Loans and leases are monitored for credit quality on a recurring basis. Commercial loans and leases and consumer loans have different credit quality indicators as a result of the unique characteristics of the loan classes being evaluated. The credit quality indicators for Non-PCD commercial loans and leases are developed through a review of individual borrowers on an ongoing basis. Commercial loans are evaluated periodically with more frequent evaluations done on criticized loans. The indicators as of the date presented are based on the most recent assessment performed and are defined below: Pass – A pass rated asset is not adversely classified because it does not display any of the characteristics for adverse classification. Special mention – A special mention asset has potential weaknesses which deserve management’s close attention. If left uncorrected, such potential weaknesses may result in deterioration of the repayment prospects or collateral position at some future date. Special mention assets are not adversely classified and do not warrant adverse classification. Substandard – A substandard asset is inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged, if any. Assets classified as substandard generally have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. These assets are characterized by the distinct possibility of loss if the deficiencies are not corrected. Doubtful – An asset classified as doubtful has all the weaknesses inherent in an asset classified substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently existing facts, conditions and values. Loss – Assets classified as loss are considered uncollectible and of such little value it is inappropriate to be carried as an asset. This classification is not necessarily equivalent to any potential for recovery or salvage value, but rather it is not appropriate to defer a full charge-off even though partial recovery may be affected in the future. Ungraded – Ungraded loans represent loans not included in the individual credit grading process due to their relatively small balances or borrower type. The majority of ungraded loans at June 30, 2023 and December 31, 2022, relate to business credit cards. Business credit card loans are subject to automatic charge-off when they become 120 days past due in the same manner as unsecured consumer lines of credit. The credit quality indicator for consumer loans is based on delinquency status of the borrower as of the date presented. As the borrower becomes more delinquent, the likelihood of loss increases. An exemption is applied to government guaranteed loans as the principal repayments are insured by the Federal Housing Administration and U.S. Department of Veterans Affairs and thus remain on accrual status regardless of delinquency status. The following tables summarize the commercial and SVB loans disaggregated by year of origination and by risk rating. The consumer loan delinquency status by year of origination is also presented below. The tables reflect the amortized cost of the loans and include PCD loans. Commercial Loans - Risk Classifications by Class
SVB - Risk Classifications by Class
Consumer Loans - Delinquency Status by Class
The following tables represent current credit quality indicators by origination year as of December 31, 2022: Commercial Loans - Risk Classifications by Class
Consumer Loans - Delinquency Status by Class
Gross Charge-offs Gross charge-off vintage disclosures by origination year and loan class are summarized in the following table for the six months ended June 30, 2023: Gross Charge-offs
Loan Modifications for Borrowers Experiencing Financial Difficulties On January 1, 2023, we adopted ASU 2022-02 as further discussed in Note 1 — Significant Accounting Policies and Basis of Presentation. The Modification Disclosures required by ASU 2022-02 are included below. As part of BancShares’ ongoing credit risk management practices, BancShares attempts to work with borrowers when necessary to extend or modify loan terms to better align with borrowers current ability to repay. BancShares’ modifications granted to debtors experiencing financial difficulties typically take the form of term extensions, interest rate reductions, other-than-insignificant payment delays, principal forgiveness, or a combination thereof. Modifications are made in accordance with internal policies and guidelines to conform to regulatory guidance. The following tables present loan modifications made to debtors experiencing financial difficulty, disaggregated by class and type of loan modification. The tables also include the weighted average term extensions, as well as the modification total relative to the total period-end amortized cost basis of loans in the respective loan class. Loan Modifications Made to Borrowers Experiencing Financial Difficulty (three months ended June 30, 2023)
Loan Modifications Made to Borrowers Experiencing Financial Difficulty (six months ended June 30, 2023)
(1) Term extensions include loans where the balloon payment has been deferred to a later date or is amortizing over an extended period. Borrowers experiencing financial difficulties are typically identified in our credit risk management process before loan modifications occur. An assessment of whether a borrower is experiencing financial difficulty is reassessed or performed on the date of a modification. Since the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance, a change to the allowance for credit losses is generally not recorded upon modification. Upon BancShares’ determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is charged off. There were no significant amounts of modified loans that subsequently defaulted during the first and second quarters of 2023. The following tables present the amortized cost and performance of modified loans to borrowers experiencing financial difficulties. The period of delinquency is based on the number of days the scheduled payment is contractually past due. Modified Loans Payment Status (three months ended June 30, 2023)
Modified Loans Payment Status (six months ended June 30, 2023)
At June 30, 2023, there were $12 million of commitments to lend additional funds to debtors experiencing financial difficulty for which the terms of the loan were modified. Prior Period Troubled Debt Restructuring The following includes disclosures for certain loan modifications or restructurings as troubled debt restructurings (“TDRs”) for historical periods prior to adoption of ASU 2022-02. In general, a modification or restructuring of a loan was considered a TDR if, for economic or legal reasons related to a borrower’s financial difficulties, a concession is granted to the borrower that creditors would not otherwise consider. Many aspects of a borrower’s financial situation are assessed when determining whether they are experiencing financial difficulty. Concessions may have related to the contractual interest rate, maturity date, payment structure or other actions. The assessments of whether a borrower was experiencing (or is likely to experience) financial difficulty, and whether a concession had been granted, were subjective in nature and management’s judgment was required when determining whether a modification was classified as a TDR. Modified loans that met the definition of a TDR were subject to BancShares’ individually reviewed loans policy. The following table presents amortized cost of TDRs: TDRs
The following table summarizes the loan restructurings during the three and six months ended June 30, 2022 that were designated as TDRs. BancShares defines payment default as movement of the TDR to non-accrual status, which is generally 90 days past due, foreclosure or charge-off, whichever occurs first. Restructurings
There were $1.5 million commitments to lend additional funds to borrowers whose loan terms were modified in TDRs as of December 31, 2022. After a loan is determined to be a TDR, BancShares continues to track its performance under its most recent restructured terms. TDRs that subsequently defaulted during the three and six months ended June 30, 2022, and were classified as TDRs during the applicable 12-month period preceding June 30, 2022 were as follows: TDR Defaults
Loans Pledged The following table provides information regarding loans pledged as collateral for borrowing capacity through the FHLB of Atlanta and the Federal Reserve Bank (“FRB”) as of June 30, 2023 and December 31, 2022. Loans Pledged
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Allowance for Credit Losses |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Credit Losses | ALLOWANCE FOR CREDIT LOSSES The ACL for loans and leases is reported in the allowance for credit losses on the Consolidated Balance Sheets, while the ACL for unfunded commitments is reported in other liabilities. The provision or benefit for credit losses related to (i) loans and leases (ii) unfunded commitments and (iii) investment securities available for sale is reported in the Consolidated Statements of Income as provision or benefit for credit losses. The initial ACL for PCD loans and leases acquired in the SVBB Acquisition and the CIT Merger (the “Initial PCD ACL”) were established through a PCD Gross-Up and there were no corresponding increases to the provision for credit losses. The PCD Gross-Ups are discussed further in Note 1 — Significant Accounting Policies and Basis of Presentation. The initial ACL for Non-PCD loans and leases acquired in the SVBB Acquisition and the CIT Merger were established through corresponding increases to the provision for credit losses (the “day 2 provision for loans and leases”). The initial ACL for unfunded commitments acquired in the SVBB Acquisition and the CIT Merger were established through a corresponding increase to the provision for unfunded commitments (the “day 2 provision for unfunded commitments”). The ACL activity for loans and leases, unfunded commitments and investment securities is summarized in the following tables. ACL for Loans and Leases
ACL for Unfunded Commitments
ACL for Investment Securities
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | LEASES Lessee BancShares leases primarily include administrative offices and bank locations. Substantially all of our lease liabilities relate to United States real estate leases under operating lease arrangements. Our real estate leases have remaining lease terms of up to 16 years. Our lease terms may include options to extend or terminate the lease. The options are included in the lease term when it is determined that it is reasonably certain the option will be exercised. The following table presents supplemental balance sheet information and remaining weighted average lease terms and discount rates. Supplemental Lease Information
The following table presents components of lease cost: Components of Net Lease Cost
(1) Includes short-term lease cost, which is not significant. Variable lease cost includes common area maintenance, property taxes, utilities, and other operating expenses related to leased premises recognized in the period in which the expense was incurred. Certain of our lease agreements also include rental payments adjusted periodically for inflation. While lease liabilities are not remeasured because of these changes, these adjustments are treated as variable lease costs and recognized in the period in which the expense is incurred. Sublease income results from leasing excess building space that BancShares is no longer utilizing under operating leases, which have remaining lease terms of up to 13 years. The following table presents supplemental cash flow information related to leases: Supplemental Cash Flow Information
Lessor BancShares leases equipment to commercial end-users under operating lease and finance lease arrangements. The majority of operating lease equipment is long-lived rail equipment, which is typically leased several times over its life. We also lease technology and office equipment, and large and small industrial, medical, and transportation equipment under both operating leases and finance leases. The table that follows presents lease income related to BancShares’ operating and finance leases: Lease Income
(1) Primarily includes per diem railcar operating lease rental income earned on a time or mileage usage basis. (2) Includes leased equipment property tax reimbursements due from customers of $3 million and $8 million for the three and six months ended June 30, 2023, respectively, and revenue related to insurance coverage on leased equipment of $10 million and $21 million for the three and six months ended June 30, 2023, respectively. Includes leased equipment property tax reimbursements due from customers of $5 million and $8 million for the three and six months ended June 30, 2022, respectively, and revenue related to insurance coverage on leased equipment of $8 million and $15 million for the three and six months ended June 30, 2022, respectively.
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Leases | LEASES Lessee BancShares leases primarily include administrative offices and bank locations. Substantially all of our lease liabilities relate to United States real estate leases under operating lease arrangements. Our real estate leases have remaining lease terms of up to 16 years. Our lease terms may include options to extend or terminate the lease. The options are included in the lease term when it is determined that it is reasonably certain the option will be exercised. The following table presents supplemental balance sheet information and remaining weighted average lease terms and discount rates. Supplemental Lease Information
The following table presents components of lease cost: Components of Net Lease Cost
(1) Includes short-term lease cost, which is not significant. Variable lease cost includes common area maintenance, property taxes, utilities, and other operating expenses related to leased premises recognized in the period in which the expense was incurred. Certain of our lease agreements also include rental payments adjusted periodically for inflation. While lease liabilities are not remeasured because of these changes, these adjustments are treated as variable lease costs and recognized in the period in which the expense is incurred. Sublease income results from leasing excess building space that BancShares is no longer utilizing under operating leases, which have remaining lease terms of up to 13 years. The following table presents supplemental cash flow information related to leases: Supplemental Cash Flow Information
Lessor BancShares leases equipment to commercial end-users under operating lease and finance lease arrangements. The majority of operating lease equipment is long-lived rail equipment, which is typically leased several times over its life. We also lease technology and office equipment, and large and small industrial, medical, and transportation equipment under both operating leases and finance leases. The table that follows presents lease income related to BancShares’ operating and finance leases: Lease Income
(1) Primarily includes per diem railcar operating lease rental income earned on a time or mileage usage basis. (2) Includes leased equipment property tax reimbursements due from customers of $3 million and $8 million for the three and six months ended June 30, 2023, respectively, and revenue related to insurance coverage on leased equipment of $10 million and $21 million for the three and six months ended June 30, 2023, respectively. Includes leased equipment property tax reimbursements due from customers of $5 million and $8 million for the three and six months ended June 30, 2022, respectively, and revenue related to insurance coverage on leased equipment of $8 million and $15 million for the three and six months ended June 30, 2022, respectively.
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Goodwill and Core Deposit Intangibles |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Core Deposit Intangibles | GOODWILL AND CORE DEPOSIT INTANGIBLES Goodwill BancShares applied the acquisition method of accounting for the SVBB Acquisition and the CIT Merger. The fair value of the net assets acquired exceeded the purchase prices for both acquisitions. Consequently, there was a gain on acquisition (and no goodwill) as discussed further in Note 2 — Business Combinations. BancShares had goodwill of $346 million at June 30, 2023 and December 31, 2022 that relates to business combinations completed prior to the SVBB Acquisition and the CIT Merger. All of the goodwill relates to the General Banking reporting segment. There was no goodwill impairment during the six months ended June 30, 2023 or 2022. Core Deposit Intangibles Core deposit intangibles represent the estimated fair value of core deposits and other customer relationships acquired. Core deposit intangibles are being amortized over their estimated useful life. The following tables summarize the activity for core deposit intangibles during the six months ended June 30, 2023. Core Deposit Intangibles
Core Deposit Intangible Accumulated Amortization
The following table summarizes the expected amortization expense as of June 30, 2023 in subsequent periods for core deposit intangibles. Core Deposit Intangible Expected Amortization
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Variable Interest Entities |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entities | VARIABLE INTEREST ENTITIES Variable Interest Entities Described below are the results of BancShares’ assessment of its variable interests in order to determine its current status with regard to being the VIE primary beneficiary. Refer to Note 1 — Significant Accounting Policies and Basis of Presentation for additional information on accounting for VIEs and investments in qualified housing projects. Consolidated VIEs At June 30, 2023 and December 31, 2022, there were no consolidated VIEs. Unconsolidated VIEs Unconsolidated VIEs include limited partnership interests and joint ventures where BancShares’ involvement is limited to an investor interest and BancShares does not have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance or obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. The table below provides a summary of the assets and liabilities included on the Consolidated Balance Sheets associated with unconsolidated VIEs. The table also presents our maximum exposure to loss which consists of outstanding book basis and unfunded commitments for future investments, and represents potential losses that would be incurred under hypothetical circumstances, such that the value of BancShares’ interests and any associated collateral declines to zero and assuming no recovery. BancShares believes the possibility is remote under this hypothetical scenario; accordingly, this disclosure is not an indication of expected loss. As disclosed in Note 2 — Business Combinations, the following tables as of June 30, 2023 include VIEs acquired in the SVBB Acquisition. Unconsolidated VIEs Carrying Value
(1) Included in other assets. (2) Represents commitments to invest in qualified affordable housing investments and other investments qualifying for community reinvestment tax credits. These commitments are payable on demand and are included in other liabilities.
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Other Assets |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Assets | OTHER ASSETS The following table includes the components of other assets. The increases from December 31, 2022 primarily reflect other assets acquired in conjunction with the SVBB Acquisition as further discussed in Note 2 — Business Combinations. Other Assets
(1) Refer to Note 8 — Variable Interest Entities for additional information. (2) The balance at December 31, 2022 included $607 million in “Other” related to bank-owned life insurance policies that had terminated, but not cash-settled. These items cash-settled during 2023.
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Deposits |
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Statistical Disclosure for Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits | DEPOSITS The following table provides detail on deposit types. The deposit balances as of June 30, 2023 include those acquired in the SVBB Acquisition, as described in Note 2 — Business Combinations. Deposit Types
At June 30, 2023, the scheduled maturities of time deposits were: Deposit Maturities
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Borrowings |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Borrowings | BORROWINGS Short-term Borrowings Short-term borrowings at June 30, 2023 and December 31, 2022 include:
Securities Sold under Agreements to Repurchase BancShares held $454 million and $436 million at June 30, 2023 and December 31, 2022, respectively, of securities sold under agreements to repurchase that have overnight contractual maturities and are collateralized by government agency securities. BancShares utilizes securities sold under agreements to repurchase to facilitate the needs for collateralization of commercial customers and secure wholesale funding needs. Repurchase agreements are transactions whereby BancShares offers to sell to a counterparty an undivided interest in an eligible security at an agreed upon purchase price, and which obligates BancShares to repurchase the security at an agreed upon date, repurchase price and interest rate. These agreements are recorded at the amount of cash received in connection with the transactions and are reflected as securities sold under customer repurchase agreements. BancShares monitors collateral levels on a continuous basis and maintains records of each transaction specifically describing the applicable security and the counterparty’s fractional interest in that security, and segregates the security from general assets in accordance with regulations governing custodial holdings of securities. The primary risk with repurchase agreements is market risk associated with the investments securing the transactions, as additional collateral may be required based on fair value changes of the underlying investments. Securities pledged as collateral under repurchase agreements are maintained with safekeeping agents. The carrying value of investment securities pledged as collateral under repurchase agreements was $508 million and $496 million at June 30, 2023 and December 31, 2022, respectively. Long-term Borrowings Long-term borrowings at June 30, 2023 and December 31, 2022 include: Long-term Borrowings
(1) Issued in connection with the SVBB Acquisition and will be secured by acquired loans. See below and Note 2 — Business Combinations for further information. (2) At June 30, 2023 and December 31, 2022, unamortized purchase accounting adjustments were $62 million and $69 million, respectively, for subordinated debentures. Pledged Assets At June 30, 2023, BancShares had pledged $30.0 billion of loans to the FHLB and FRB. As a member of the FHLB, FCB can access financing based on an evaluation of its creditworthiness, statement of financial position, size and eligibility of collateral. Pledged assets related to these financings totaled $24.0 billion at June 30, 2023. FCB may at any time grant a security interest in, sell, convey or otherwise dispose of any of the assets used for collateral, provided that FCB is in compliance with the collateral maintenance requirement immediately following such disposition. Under borrowing arrangements with the FRB of Richmond, BancShares has access to an additional $4.8 billion on a secured basis. There were no outstanding borrowings with the FRB Discount Window at June 30, 2023 and December 31, 2022. Assets pledged to the FRB of Richmond totaled $6.0 billion at June 30, 2023. In connection with the SVBB Acquisition, FCB and the FDIC entered into a Purchase Money Note, which is primarily secured by all loans acquired and related commitments that subsequently were drawn and outstanding as of June 30, 2023. At June 30, 2023, BancShares had a credit line allowing contingent access to borrowings on an unsecured basis of up to $100 million, of which $85 million was unused and available.
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Derivative Financial Instruments |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Financial Instruments | DERIVATIVE FINANCIAL INSTRUMENTS The following table presents notional amount and fair value of derivative financial instruments on a gross basis. At June 30, 2023, and December 31, 2022 BancShares’ derivatives are not designated as hedging instruments. Notional Amount and Fair Value of Derivative Financial Instruments
(1) Fair value balances include accrued interest. (2) The foreign exchange contracts exclude foreign exchange spot contracts. The notional amounts of these contracts were $161 million as of June 30, 2023, and $0 million as of December 31, 2022. (3) Other derivative contracts not designated as hedging instruments include risk participation agreements and equity warrants. (4) BancShares accounts for swap contracts cleared by the Chicago Mercantile Exchange and LCH Clearnet as “settled-to-market”. As a result, variation margin payments are characterized as settlement of the derivative exposure and variation margin balances are netted against the corresponding derivative mark-to-market balances. Gross amounts of recognized assets and liabilities were lowered by $154 million and $33 million, respectively, at June 30, 2023, and $376 million and $19 million, respectively at December 31, 2022. (5) BancShares’ derivative transactions are governed by International Swaps and Derivatives Association (“ISDA”) agreements that allow for net settlements of certain payments as well as offsetting of all contracts with a given counterparty in the event of bankruptcy or default of one of the two parties to the transaction. BancShares believes its ISDA agreements meet the definition of a master netting arrangement or similar agreement for purposes of the above disclosure. (6) In conjunction with the ISDA agreements described above, BancShares has entered into collateral arrangements with its counterparties, which provide for the exchange of cash depending on change in the market valuation of the derivative contracts outstanding. Such collateral is available to be applied in settlement of the net balances upon an event of default of one of the counterparties. Collateral pledged or received is included in other assets or other liabilities, respectively. Non-Qualifying Hedges The following table presents gains of non-qualifying hedges recognized on the Consolidated Statements of Income: Gains on Non-Qualifying Hedges
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Other Liabilities |
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Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities | OTHER LIABILITIES The following table includes the components of other liabilities. The increases from December 31, 2022 primarily reflect other liabilities assumed in conjunction with the SVBB Acquisition as further discussed in Note 2 — Business Combinations. Other Liabilities
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Fair Value |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | FAIR VALUE Fair Value Hierarchy BancShares measures certain financial assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP also establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels. Assets and liabilities are recorded at fair value according to a fair value hierarchy comprised of three levels. The levels are based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. The level within the fair value hierarchy for an asset or liability is based on the lowest level of input significant to the fair value measurement with Level 1 inputs considered highest and Level 3 inputs considered lowest. A brief description of each input level follows: •Level 1 inputs are quoted prices in active markets for identical assets and liabilities. •Level 2 inputs are quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs other than quoted prices observable for the assets or liabilities and market corroborated inputs. •Level 3 inputs are unobservable inputs for the asset or liability. These unobservable inputs and assumptions reflect the estimates market participants would use in pricing the asset or liability. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table summarizes BancShares’ assets and liabilities measured at estimated fair value on a recurring basis: Assets and Liabilities Measured at Fair Value - Recurring Basis
(1) Derivative fair values include accrued interest. The methods and assumptions used to estimate the fair value of each class of financial instruments measured at fair value on a recurring basis are as follows: Investment securities available for sale. The fair value of U.S. Treasury, government agency, mortgage-backed securities, municipal bonds, and a portion of the corporate bonds are generally estimated using a third-party pricing service. To obtain an understanding of the processes and methodologies used, management reviews correspondence from the third-party pricing service. Management also performs a price variance analysis process to corroborate the reasonableness of prices. The third-party provider evaluates securities based on comparable investments with trades and market data and will utilize pricing models which use a variety of inputs, such as benchmark yields, reported trades, issuer spreads, benchmark securities, bids and offers as needed. These securities are generally classified as Level 2. The remaining corporate bonds held are generally measured at fair value based on indicative bids from broker-dealers using inputs that are not directly observable. These securities are classified as Level 3. Marketable equity securities. Equity securities are measured at fair value using observable closing prices. The valuation also considers the amount of market activity by examining the trade volume of each security. Equity securities are classified as Level 1 if they are traded in an active market and as Level 2 if the observable closing price is from a less than active market. Loans held for sale. Certain residential real estate loans originated for sale to investors are carried at fair value based on quoted market prices for similar types of loans. Accordingly, the inputs used to calculate fair value of originated residential real estate loans held for sale are considered Level 2 inputs. Derivative Assets and Liabilities. Derivatives were valued using models that incorporate inputs depending on the type of derivative. Other than the fair value of equity warrants and credit derivatives, which were estimated using Level 3 inputs, most derivative instruments were valued using Level 2 inputs based on observed pricing for similar assets and liabilities and model-based valuation techniques for which all significant assumptions are observable in the market. See Note 12 — Derivative Financial Instruments for notional amounts and fair values. The following tables summarize information about significant unobservable inputs related to BancShares’ categories of Level 3 financial assets and liabilities measured on a recurring basis: Quantitative Information About Level 3 Fair Value Measurements - Recurring Basis
The following table summarizes the changes in estimated fair value for all assets and liabilities measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3): Changes in Estimated Fair Value of Level 3 Financial Assets and Liabilities - Recurring Basis
Fair Value Option The following table summarizes the difference between the aggregate fair value and the UPB for residential real estate loans originated for sale measured at fair value as of June 30, 2023 and December 31, 2022: Aggregate Fair Value and UPB - Residential Real Estate Loans
BancShares has elected the fair value option for residential real estate loans originated for sale. This election reduces certain timing differences in the Consolidated Statements of Income and better aligns with the management of the portfolio from a business perspective. The changes in fair value were recorded as a component of mortgage income and included $0 million and a gain of $1 million for the three months ended June 30, 2023 and 2022, respectively, and $0 million and a loss of $2 million for the six months ended June 30, 2023 and 2022, respectively. Interest earned on loans held for sale is recorded within interest income on loans and leases in the Consolidated Statements of Income. No originated loans held for sale were 90 or more days past due or on non-accrual status as of June 30, 2023 or December 31, 2022. Assets Measured at Estimated Fair Value on a Non-recurring Basis Certain assets or liabilities are required to be measured at estimated fair value on a non-recurring basis subsequent to initial recognition. Generally, these adjustments are the result of LOCOM or other impairment accounting. The following table presents carrying value of assets measured at estimated fair value on a non-recurring basis for which gains and losses have been recorded in the periods. The gains and losses reflect amounts recorded for the respective periods, regardless of whether the asset is still held at period end. Assets Measured at Fair Value - Non-recurring Basis
Certain other assets are adjusted to their fair value on a non-recurring basis, including certain loans, OREO, and goodwill, which are periodically tested for impairment, and mortgage servicing rights (“MSRs”), which are carried at the lower of amortized cost or market. Most loans held for investment, deposits, and borrowings are not reported at fair value. The methods and assumptions used to estimate the fair value of each class of financial instruments measured at fair value on a non-recurring basis are as follows: Assets held for sale - loans. Loans held for investment subsequently transferred to held for sale are carried at the lower of cost or market. When available, the fair values for the transferred loans are based on quoted prices from the purchase commitments for the individual loans being transferred and are considered Level 1 inputs. The fair value of Level 2 assets was primarily estimated based on prices of recent trades of similar assets. For other loans held for sale, the fair value of Level 3 assets was primarily measured under the income approach using the discounted cash flow model based on Level 3 inputs including discount rate or the price of committed trades. Loans - collateral dependent loans. The population of Level 3 loans measured at fair value on a non-recurring basis includes collateral-dependent loans evaluated individually. Collateral values are determined using appraisals or other third-party value estimates of the subject property discounted based on estimated selling costs, and adjustments for other external factors that may impact the marketability of the collateral. Other real estate owned. OREO is carried at LOCOM. OREO asset valuations are determined by using appraisals or other third-party value estimates of the subject property with discounts, generally between 6% and 11%, applied for estimated selling costs and other external factors that may impact the marketability of the property. At June 30, 2023 and December 31, 2022, the weighted average discount applied was 8.68% and 9.31%, respectively. Changes to the value of the assets between scheduled valuation dates are monitored through continued communication with brokers and monthly reviews by the asset manager assigned to each asset. If there are any significant changes in the market or the subject property, valuations are adjusted or new appraisals are ordered to ensure the reported values reflect the most current information. Mortgage servicing rights. MSRs are carried at the lower of amortized cost or market and are, therefore, carried at fair value only when fair value is less than amortized cost. The fair value of MSRs is determined using a pooling methodology. Similar loans are pooled together and a discounted cash flow model, which takes into consideration discount rates, prepayment rates, and the weighted average cost to service the loans, is used to determine the fair value. Financial Instruments Fair Value The table below presents the carrying values and estimated fair values for financial instruments, excluding leases and certain other assets and liabilities for which these disclosures are not required. Carrying Values and Fair Values of Financial Assets and Liabilities
The methods and assumptions used to estimate the fair value of each class of financial instruments not discussed elsewhere are as follows: Net loans. The carrying value of net loans is net of the ACL. Loans are generally valued by discounting expected cash flows using market inputs with adjustments based on cohort level assumptions for certain loan types as well as internally developed estimates at a business segment level. Due to the significance of the unobservable market inputs and assumptions, as well as the absence of a liquid secondary market for most loans, these loans are classified as Level 3. Certain loans are measured based on observable market prices sourced from external data providers and classified as Level 2. Nonaccrual loans are written down and reported at their estimated recovery value which approximates their fair value and classified as Level 3. Securities Purchased Under Agreement to Resell. The fair value of securities purchased under agreement to resell equal the carrying value due to the short term nature, generally overnight, and therefore present an insignificant risk of change in fair value due to changes in market interest rate, and classified as Level 2. Investment securities held to maturity. BancShares’ portfolio of held to maturity debt securities consists of mortgage-backed securities issued by government agencies and government sponsored entities, U.S. Treasury notes, unsecured bonds issued by government agencies and government sponsored entities, and securities issued by the Supranational Entities and Multilateral Development Banks. We primarily use prices obtained from pricing services to determine the fair value of securities, which are Level 2 inputs. FHLB stock. The carrying amount of FHLB stock is a reasonable estimate of fair value, as these securities are not readily marketable and are evaluated for impairment based on the ultimate recoverability of the par value. BancShares considers positive and negative evidence, including the profitability and asset quality of the issuer, dividend payment history and recent redemption experience, when determining the ultimate recoverability of the par value. BancShares investment in FHLB stock is ultimately recoverable at par. The inputs used in the fair value measurement for the FHLB stock are considered Level 2 inputs. Mortgage servicing rights. MSRs are initially recorded at fair value and subsequently carried at the lower of amortized cost or market. Therefore, servicing rights are carried at fair value only when fair value is less than the amortized cost. The fair value of MSRs is determined using a pooling methodology. Similar loans are pooled together and a model which relies on discount rates, estimates of prepayment rates and the weighted average cost to service the loans is used to determine the fair value. The inputs used in the fair value measurement for MSRs are considered Level 3 inputs. Deposits. The estimated fair value of deposits with no stated maturity, such as demand deposit accounts, money market accounts, and savings accounts was the amount payable on demand at the reporting date. The fair value of time deposits was estimated based on a discounted cash flow technique using Level 2 inputs appropriate to the contractual maturity. Credit balances of factoring clients. The impact of the time value of money from the unobservable discount rate for credit balances of factoring clients is inconsequential due to the short term nature of these balances, therefore, the fair value approximated carrying value, and the credit balances were classified as Level 3. Short-term borrowed funds. Includes repurchase agreements and certain other short-term borrowings. The fair value approximates carrying value and are classified as Level 2. Long-term borrowings. For certain long-term senior and subordinated unsecured borrowings, the fair values are sourced from a third-party pricing service. The fair value of other long-term borrowings are determined by discounting future cash flows using current interest rates for similar financial instruments. The inputs used in the fair value measurement for FHLB borrowings, senior and subordinated debentures, and other borrowings are classified as Level 2. The fair value of other secured borrowings are estimated based on unobservable inputs and therefore classified as Level 3. For all other financial assets and financial liabilities, the carrying value is a reasonable estimate of the fair value as of June 30, 2023 and December 31, 2022. The carrying value and fair value for these assets and liabilities are equivalent because they are relatively short-term in nature and there is no interest rate or credit risk that would cause the fair value to differ from the carrying value. Cash and due from banks, and interest earning deposits at banks, are classified on the fair value hierarchy as Level 1. Accrued interest receivable and accrued interest payable are classified as Level 2.
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Stockholders' Equity |
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Stockholders' Equity | STOCKHOLDERS' EQUITY A roll forward of common stock activity is presented in the following table: Number of Shares of Common Stock
Common Stock The Parent Company has Class A Common Stock and Class B common stock (“Class B Common Stock”). Class A Common Stock have one vote per share, while shares of Class B Common Stock have 16 votes per share. Non-Cumulative Perpetual Preferred Stock The following table summarizes BancShares’ non-cumulative perpetual preferred stock. Preferred Stock
(1) Beginning July 1, 2023, BancShares has moved to Term SOFR plus a credit spread adjustment for its Series B Preferred Stock. The final dividend payment based on a LIBOR accrual will occur September 15, 2023. For further description of BancShares’ non-cumulative perpetual preferred stock, refer to Note 17 — Stockholders’ Equity in Item 8 of our 2022 Form 10-K. Authorized Shares On April 25, 2023 the Parent Company’s stockholders approved amendments to the Restated Certificate of Incorporation to increase the number of authorized shares of the Class A Common Stock from 16,000,000 shares to 32,000,000 shares and to increase the number of authorized shares of the Preferred Stock from 10,000,000 shares to 20,000,000.
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Accumulated Other Comprehensive (Loss) Income |
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Accumulated Other Comprehensive (Loss) Income | ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME The following table details the components of Accumulated Other Comprehensive (Loss) Income (“AOCI”): Components of Accumulated Other Comprehensive (Loss) Income
The following table details the changes in the components of AOCI, net of income taxes: Changes in Accumulated Other Comprehensive (Loss) Income by Component
Other Comprehensive Income The amounts included in the Condensed Consolidated Statements of Comprehensive Income are net of income taxes. The following table presents the pretax and after-tax components of other comprehensive income: Other Comprehensive Income (Loss) by Component
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Regulatory Capital |
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Regulatory Capital | REGULATORY CAPITAL BancShares and FCB are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the BancShares’ Consolidated Financial Statements. Certain activities, such as the ability to undertake new business initiatives, including acquisitions, the access to and cost of funding for new business initiatives, the ability to pay dividends, the ability to repurchase shares or other capital instruments, the level of deposit insurance costs, and the level and nature of regulatory oversight, largely depend on a financial institution’s capital strength. Federal banking agencies approved regulatory capital guidelines (“Basel III”) aimed at strengthening previous capital requirements for banking organizations. Basel III became effective for BancShares on January 1, 2015 and the associated capital conservation buffers of 2.50% were fully phased in by January 1, 2019. The following table includes the Basel III requirements for regulatory capital ratios.
The FDIC also has Prompt Corrective Action (“PCA”) thresholds for regulatory capital ratios. The regulatory capital ratios for BancShares and FCB are calculated in accordance with the guidelines of the federal banking authorities. The regulatory capital ratios for BancShares and FCB exceed the Basel III requirements and the PCA well-capitalized thresholds as of June 30, 2023 and December 31, 2022 as summarized in the following table.
At June 30, 2023, BancShares and FCB had risk-based capital ratio conservation buffers of 7.84% and 7.69%, respectively, which are in excess of the fully phased in Basel III conservation buffer of 2.50%. At December 31, 2022, BancShares and FCB had risk-based capital ratio conservation buffers of 5.06% and 4.99%, respectively. The capital ratio conservation buffers represent the excess of the regulatory capital ratio as of June 30, 2023 and December 31, 2022 over the Basel III minimum for the ratio that is the binding constraint. Additional Tier 1 capital for BancShares includes preferred stock discussed further in Note 15 — Stockholders’ Equity. Additional Tier 2 capital for BancShares and FCB primarily consists of qualifying ACL and qualifying subordinated debt. Dividend Restrictions Dividends paid from FCB to the Parent Company are the primary source of funds available to the Parent Company for payment of dividends to its stockholders. The Board of Directors of FCB may approve distributions, including dividends, as it deems appropriate, subject to the requirements of the FDIC and the General Statutes of North Carolina, provided that the distributions do not reduce the regulatory capital ratios below the applicable requirements. FCB could have paid additional dividends to the Parent Company in the amount of $8.09 billion while continuing to meet the requirements for well-capitalized banks at June 30, 2023. Dividends declared by FCB and paid to the Parent Company amounted to $117 million for the six months ended June 30, 2023. Payment of dividends is made at the discretion of FCB’s Board of Directors and is contingent upon satisfactory earnings as well as projected capital needs.
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Earnings Per Common Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Common Share | EARNINGS PER COMMON SHARE The following table sets forth the computation of the basic and diluted earnings per common share: Earnings per Common Share
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Income Taxes |
6 Months Ended |
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Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES BancShares’ global effective income tax rates were 23.9% and 1.6% for the three and six months ended June 30, 2023, respectively, and 24.2% and 6.3% for the three and six months ended June 30, 2022, respectively. While the effective tax rates for the three months ended June 30, 2023 and 2022 were relatively consistent, the decrease from 6.3% in the prior year to 1.6% for the six months ended June 30, 2023 was primarily due to the preliminary gain on acquisition relating to the SVBB Acquisition. The quarterly income tax expense is based on a projection of BancShares’ annual effective tax rate (“ETR”). This annual ETR is applied to the year-to-date consolidated pre-tax income to determine the interim provision for income taxes before discrete items. The ETR each period is also impacted by a number of factors, including the relative mix of domestic and international earnings, effects of changes in enacted tax laws, adjustments to the valuation allowances, and discrete items. The currently forecasted ETR may vary from the actual year-end 2023 ETR due to the changes in these factors. Uncertain Tax Benefits BancShares’ recognizes tax benefits when it is more likely than not that the position will prevail, based solely on the technical merits under the tax law of the relevant jurisdiction. BancShares will recognize the tax benefit if the position meets this recognition threshold determined based on the largest amount of the benefit that is more than likely to be realized. Net Operating Loss Carryforwards and Valuation Adjustments As a result of the SVBB Acquisition, BancShares’ net deferred tax liabilities increased by approximately $3.28 billion, primarily related to acquired loans and other assets. BancShares’ ability to recognize deferred tax assets (“DTAs”) is evaluated on a quarterly basis to determine if there are any significant events that would affect our ability to utilize existing DTAs. If events are identified that affect our ability to utilize its DTAs, adjustments to the valuation allowance adjustments may be required. As a result of further assessment of information received during the second quarter related to the SVBB Acquisition, BancShares released approximately $12 million in the quarter of the $70 million valuation allowance recorded at December 31, 2022.
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Employee Benefit Plans |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS BancShares sponsors non-contributory defined benefit pension plans for its qualifying employees. The service cost component of net periodic benefit cost is included in salaries and wages while all other non-service cost components are included in other noninterest expense. The components of net periodic benefit cost are as follows:
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Business Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segment Information | BUSINESS SEGMENT INFORMATION BancShares’ segments include General Banking, Commercial Banking, a new segment Silicon Valley Banking that includes the operating results for the SVBB Acquisition, as well as Rail and Corporate. Each of the segments are described below. General Banking General Banking delivers products and services to consumers and businesses through an extensive network of branches and various digital channels, including a full suite of deposit products, loans (primarily residential mortgages and business/commercial loans), and various fee-based services. General Banking also provides a variety of wealth management products and services to individuals and institutional clients, including brokerage, investment advisory, and trust services. In addition, General Banking has a dedicated business line that supports deposit, cash management and lending to homeowner associations and property management companies nationwide. Revenue is primarily generated from interest earned on loans and fees for banking and advisory services. Commercial Banking Commercial Banking provides a range of lending, leasing, capital markets, asset management and other financial and advisory services primarily to small and middle market companies in a wide range of industries. Loans offered are primarily senior secured loans collateralized by accounts receivable, inventory, machinery and equipment, transportation equipment and/or intangibles, and are often used for working capital, plant expansion, acquisitions or recapitalizations. These loans include revolving lines of credit and term loans and, depending on the nature of the collateral, may be referred to as collateral-backed loans, asset-based loans or cash flow loans. Commercial Banking provides senior secured loans to developers and other commercial real estate professionals, and also provides small business loans and leases, including both capital and operating leases, through a highly automated credit approval, documentation and funding process. Commercial Banking also provides factoring, receivable management, and secured financing to businesses that operate in various industries. Revenue is primarily generated from interest earned on loans, rents on equipment leased, fees and other revenue from lending and leasing activities and banking services, along with capital markets transactions and commissions earned on factoring and related activities. Silicon Valley Banking Silicon Valley Banking offers products and services to commercial clients in key innovation markets, such as healthcare and technology industries, as well as private equity and venture capital firms. The segment provides solutions to the financial needs of commercial clients through credit, treasury management, foreign exchange, trade finance and other services. In addition, the segment offers private banking and wealth management and provides a range of personal financial solutions for consumers. Private banking and wealth management clients consist of private equity/venture capital professionals and executive leaders of the innovation companies they support and premium wine clients. The segment offers a customized suite of private banking services, including mortgages, home equity lines of credit, restricted and private stock loans, capital call lines of credit, other secured and unsecured lending products and vineyard development loans, as well as planning-based financial strategies, wealth management, family office, financial planning, tax planning and trust services. Revenue is primarily generated from interest earned on loans, and fees and other revenue from lending activities and banking services. Deposit products include business and analysis checking accounts, money market accounts, multi-currency accounts, bank accounts, sweep accounts and positive pay services. Services are provided through online and mobile banking platforms, as well as branch locations. Rail Rail offers customized leasing and financing solutions on a fleet of railcars and locomotives to railroads and shippers throughout North America. Railcar types include covered hopper cars used to ship grain and agricultural products, plastic pellets, sand, and cement, tank cars for energy products and chemicals, gondolas for coal, steel coil and mill service products, open hopper cars for coal and aggregates, boxcars for paper and auto parts, and center beams and flat cars for lumber. Revenue is primarily from operating lease income. Corporate Certain items that are not allocated to operating segments are included in the Corporate segment, inclusive of similar items related to Silicon Valley Banking. Some of the more significant and recurring items include interest income on investment securities, a portion of interest expense primarily related to corporate funding costs (including brokered deposits), income on BOLI (other noninterest income), acquisition-related costs, as well as certain unallocated costs and certain intangible asset amortization expense (operating expenses). Corporate also includes certain significant items that are infrequent, such as the Initial Non-PCD Provision for loans and leases and unfunded commitments and gain on acquisition. Corporate also includes certain purchase accounting adjustment accretion, such as the accretion of the fair value adjustment associated with the acquired loans in the SVBB Acquisition. Segment Net Income (Loss) and Select Period End Balances The following table presents the condensed income statement by segment:
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Commitments and Contingencies |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Commitments To meet the financing needs of its customers, BancShares and its subsidiaries have financial instruments with off-balance sheet risk. These financial instruments involve elements of credit, interest rate or liquidity risk and include commitments to extend credit and standby letters of credit. The below balances for June 30, 2023 include balances related to the SVBB Acquisition. The balances acquired are included in Financing Commitments and Letters of Credit. The accompanying table summarizes credit-related commitments and other purchase and funding commitments:
(1) BancShares’ purchase and funding commitments relate to the equipment leasing businesses’ commitments to fund finance leases and operating leases, and Rail’s railcar manufacturer purchase and upgrade commitments. Financing Commitments Commitments to extend credit are legally binding agreements to lend to customers. These commitments generally have fixed expiration dates or other termination clauses and may require payment of fees. Established credit standards control the credit risk exposure associated with these commitments. In some cases, BancShares requires collateral be pledged to secure the commitment, including cash deposits, securities and other assets. Financing commitments, referred to as loan commitments or lines of credit, primarily reflect BancShares’ agreements to lend to its customers, subject to the customers’ compliance with contractual obligations. At June 30, 2023 and December 31, 2022, substantially all undrawn financing commitments were senior facilities. The undrawn and available financing commitments are primarily in the Silicon Valley Banking and Commercial Banking segments. Financing commitments also include approximately $69 million and $66 million at June 30, 2023 and December 31, 2022, respectively, related to off-balance sheet commitments to fund equity investments. Commitments to fund equity investments are contingent on events that have yet to occur and may be subject to change. As financing commitments may not be fully drawn, may expire unused, may be reduced or canceled at the customer’s request, and may require the customer to be in compliance with certain conditions, commitment amounts do not necessarily reflect actual future cash flow requirements. The table above excludes uncommitted revolving credit facilities extended by Commercial Services to its clients for working capital purposes. In connection with these facilities, Commercial Services has the sole discretion throughout the duration of these facilities to determine the amount of credit that may be made available to its clients at any time and whether to honor any specific advance requests made by its clients under these credit facilities. Letters of Credit Standby letters of credit are commitments to pay the beneficiary thereof if drawn upon by the beneficiary upon satisfaction of the terms of the letter of credit. Those commitments are primarily issued to support public and private borrowing arrangements. To mitigate its risk, BancShares’ credit policies govern the issuance of standby letters of credit. The credit risk related to the issuance of these letters of credit is essentially the same as in extending loans to clients and, therefore, these letters of credit are collateralized when necessary. These financial instruments generate fees and involve, to varying degrees, elements of credit risk in excess of amounts recognized in the Consolidated Balance Sheets. Deferred Purchase Agreements (“DPA”) A DPA is provided in conjunction with factoring, whereby a client is provided with credit protection for trade receivables without purchasing the receivables. The trade receivables terms generally require payment in 90 days or less. If the client’s customer is unable to pay an undisputed receivable solely as the result of credit risk, BancShares is then required to purchase the receivable from the client, less any borrowings for such client based on such defaulted receivable. The outstanding amount in the table above, less $136 million and $186 million at June 30, 2023 and December 31, 2022, respectively, of borrowings for such clients, is the maximum amount that BancShares would be required to pay under all DPAs. This maximum amount would only occur if all receivables subject to DPAs default in the manner described above, thereby requiring BancShares to purchase all such receivables from the DPA clients. The table above includes $1.35 billion and $1.90 billion of DPA exposures at June 30, 2023 and December 31, 2022, respectively, related to receivables on which BancShares has assumed the credit risk. The table also includes $186 million and $138 million available under DPA credit line agreements provided at June 30, 2023 and December 31, 2022, respectively. The DPA credit line agreements specify a contractually committed amount of DPA credit protection and are cancellable by us only after a notice period, which is typically 90 days or less. Litigation and other Contingencies The Parent Company and certain of its subsidiaries have been named as a defendant in legal actions arising from its normal business activities in which damages in various amounts are claimed. BancShares is also exposed to litigation risk relating to the prior business activities of banks from which assets were acquired and liabilities assumed. BancShares is involved, and from time to time in the future may be involved, in a number of pending and threatened judicial, regulatory, and arbitration proceedings as well as proceedings, investigations, examinations and other actions brought or considered by governmental and self-regulatory agencies. These matters arise in connection with the ordinary conduct of BancShares’ business. At any given time, BancShares may also be in the process of responding to subpoenas, requests for documents, data and testimony relating to such matters and engaging in discussions to resolve the matters (all of the foregoing collectively being referred to as “Litigation”). While most Litigation relates to individual claims, BancShares may be subject to putative class action claims and similar broader claims and indemnification obligations. In light of the inherent difficulty of predicting the outcome of Litigation matters and indemnification obligations, particularly when such matters are in their early stages or where the claimants seek indeterminate damages, BancShares cannot state with confidence what the eventual outcome of the pending Litigation will be, what the timing of the ultimate resolution of these matters will be, or what the eventual loss, fines, or penalties related to each pending matter will be, if any. In accordance with applicable accounting guidance, BancShares’ establishes reserves for Litigation when those matters present loss contingencies as to which it is both probable that a loss will occur and the amount of such loss can reasonably be estimated. Based on currently available information, BancShares believes that the outcome of Litigation that is currently pending will not have a material adverse effect on BancShares’ financial condition, but may be material to BancShares’ operating results or cash flows for any particular period, depending in part on its operating results for that period. The actual results of resolving such matters may be substantially higher than the amounts reserved. For certain Litigation matters in which BancShares is involved, BancShares is able to estimate a range of reasonably possible losses in excess of established reserves and insurance. For other matters for which a loss is probable or reasonably possible, such an estimate cannot be determined. For Litigation and other matters where losses are reasonably possible, management currently estimates an aggregate range of reasonably possible losses of up to $10 million in excess of any established reserves and any insurance we reasonably believe we will collect related to those matters. This estimate represents reasonably possible losses (in excess of established reserves and insurance) over the life of such Litigation, which may span a currently indeterminable number of years, and is based on information currently available as of June 30, 2023. The Litigation matters underlying the estimated range will change from time to time, and actual results may vary significantly from this estimate. Those Litigation matters for which an estimate is not reasonably possible or as to which a loss does not appear to be reasonably possible, based on current information, are not included within this estimated range and, therefore, this estimated range does not represent BancShares’ maximum loss exposure. The foregoing statements about BancShares’ Litigation are based on BancShares’ judgments, assumptions, and estimates and are necessarily subjective and uncertain. In the event of unexpected future developments, it is possible that the ultimate resolution of these cases, matters, and proceedings, if unfavorable, may be material to BancShares’ consolidated financial position in a particular period.
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Pay vs Performance Disclosure - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
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Pay vs Performance Disclosure | ||||
Net income | $ 682 | $ 255 | $ 10,200 | $ 526 |
Insider Trading Arrangements |
3 Months Ended |
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Jun. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Significant Accounting Policies and Basis of Presentation (Policies) |
6 Months Ended |
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Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Principles of Consolidation and Basis of Presentation These consolidated financial statements and notes thereto are presented in accordance with instructions for Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all information and notes necessary for a complete presentation of financial position, results of operations and cash flow activity required in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the consolidated financial position and consolidated results of operations have been made. The unaudited interim consolidated financial statements included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in BancShares’ Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”). Interim results are not necessarily indicative of results for a full year.
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Principles of Consolidation | The consolidated financial statements of BancShares include the accounts of BancShares and its subsidiaries, certain partnership interests and variable interest entities (“VIEs”) where BancShares is the primary beneficiary, if applicable. All significant intercompany accounts and transactions are eliminated upon consolidation. Assets held in agency or fiduciary capacity are not included in the consolidated financial statements. |
Reclassifications | Reclassifications In certain instances, amounts reported in the 2022 consolidated financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had no effect on previously reported stockholders’ equity or net income.
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Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions based on available information. These estimates and assumptions impact the amounts reported in the consolidated financial statements and accompanying notes and the disclosures provided, and actual results could differ from those estimates. The significant estimates related to the determination of the allowance for credit losses (“ACL”) and fair values of loans acquired in and the core deposit intangibles associated with a business combination are considered critical accounting estimates.
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Business Combinations | Business Combinations BancShares accounts for all business combinations using the acquisition method of accounting. Under this method, acquired assets and assumed liabilities are included with the acquirer’s accounts at their estimated fair value as of the date of acquisition, with any excess of purchase price over the fair value of the net tangible and intangible assets acquired recognized as goodwill. To the extent the fair value of identifiable net assets acquired exceeds the purchase price, a gain on acquisition is recognized. Acquisition-related costs are recognized as period expenses as incurred. On March 27, 2023, FCB acquired substantially all loans and certain other assets and assumed all customer deposits and certain other liabilities, of Silicon Valley Bridge Bank, N.A. (“SVBB”) from the Federal Deposit Insurance Corporation (the “FDIC”) pursuant to the terms of a purchase and assumption agreement (the “SVBB Purchase Agreement”) by and among FCB, the FDIC and the FDIC, as receiver of SVBB (the “SVBB Acquisition”). On January 3, 2022 (the “CIT Merger Date”), BancShares completed its merger (the “CIT Merger”) with CIT Group Inc. (“CIT”), pursuant to an Agreement and Plan of Merger, dated as of October 15, 2020, as amended by Amendment No. 1, dated as of September 30, 2021 (as amended, the “CIT Merger Agreement”).
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Reportable Segments | Reportable Segments As of December 31, 2022, BancShares reported its financial results in the following reportable segments: General Banking, Commercial Banking, Rail, and Corporate segments. During the first quarter of 2023, BancShares added the Silicon Valley Banking (“SVB”) reportable segment, which includes the assets acquired, liabilities assumed and related operations from the SVBB Acquisition.
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Securities Purchased Under Agreement to Resell | Securities Purchased Under Agreement to ResellSecurities purchased under agreement to resell (“reverse repos”) are accounted for as collateralized financing transactions as the terms of such purchase agreements do not qualify for sale accounting and are therefore recorded at the amount of cash advanced. Accrued interest receivables are recorded in other assets. Interest earned is recorded in interest income. |
Assets Held for Sale | Assets Held for SaleAssets held for sale (“AHFS”) primarily consists of commercial loans carried at the lower of the cost or fair value (“LOCOM”) and residential mortgage loans carried at fair value. AHFS also includes operating lease equipment held for sale carried at LOCOM. |
Loans and Leases | Loans and Leases BancShares extends credit to commercial customers through a variety of financing arrangements including term loans, revolving credit facilities, finance leases and operating leases. BancShares also extends credit through consumer loans, including residential mortgages and auto loans. Our loan classes are further described in Note 1 — Significant Accounting Policies and Basis of Presentation in the 2022 Form 10-K. SVB Loan Classes SVB loan classes were added to reflect the loans acquired in the SVBB Acquisition. The SVB loan classes are described below. Global Fund Banking – Global fund banking is the largest class of SVB loans and consists of capital call lines of credit, the repayment of which is dependent on the payment of capital calls by the underlying limited partner investors in funds managed by certain private equity and venture capital firms. Investor Dependent – The investor dependent class includes loans made primarily to technology and life science/healthcare companies. These borrowers typically have modest or negative cash flows and rarely have an established record of profitable operations. Repayment of these loans may be dependent upon receipt by borrowers of additional equity financing from venture capital firms or other investors, or in some cases, a successful sale to a third party or an initial public offering (“IPO”). The investor dependent loans are disaggregated into two classes: •Early-Stage – These include loans to pre-revenue, development-stage companies and companies that are in the early phases of commercialization, with revenues of up to $5 million. •Growth Stage – These include loans to growth-stage enterprises. Companies with revenues between $5 million and $15 million, or pre-revenue clinical-stage biotechnology companies, are considered to be mid stage, and companies with revenues in excess of $15 million are considered to be later stage. Cash Flow Dependent and Innovation Commercial and Industrial (“C&I”) – Cash flow dependent and innovation C&I loans are made primarily to technology and life science/healthcare companies that are not investor dependent. Repayment of these loans is not dependent on additional equity financing, a successful sale or an IPO. •Cash Flow Dependent – Cash flow dependent loans are typically used to assist a select group of private equity sponsors with the acquisition of businesses, are larger in size and repayment is generally dependent upon the cash flows of the combined entities. Acquired companies are typically established, later-stage businesses of scale, and characterized by reasonable levels of leverage with loan structures that include meaningful financial covenants. The sponsor’s equity contribution is often 50 percent or more of the acquisition price. •Innovation C&I – These include loans in innovation sectors such as technology and life science/healthcare industries. Innovation C&I loans are dependent on either the borrower’s cash flows or balance sheet for repayment. Cash flow dependent loans require the borrower to maintain cash flow from operations that is sufficient to service all debt. Borrowers must demonstrate normalized cash flow in excess of all fixed charges associated with operating the business. Balance sheet dependent loans include asset-backed loans and are structured to require constant current asset coverage (e.g., cash, cash equivalents, accounts receivable and, to a much lesser extent, inventory) in an amount that exceeds the outstanding debt. The repayment of these arrangements is dependent on the financial condition, and payment ability, of third parties with whom our clients do business. Private Bank – Private banking includes loans to clients who are primarily private equity/venture capital professionals and executives in the innovation companies, as well as high net worth clients. We offer a customized suite of private banking services, including mortgages, home equity lines of credit, restricted and private stock loans, personal capital call lines of credit, lines of credit against liquid assets and other secured and unsecured lending products. In addition, we provide owner occupied commercial mortgages and real estate secured loans. Commercial Real Estate (“CRE”) – CRE consists generally of acquisition financing loans for commercial properties such as office buildings, retail properties, apartment buildings and industrial/warehouse space. Other – The remaining smaller acquired portfolios are aggregated into this category. These include other C&I, premium wine and other acquired portfolios. •Other C&I loans include working capital and revolving lines of credit, as well as term loans for equipment and fixed assets. These loans are primarily to clients that are not in the technology and life sciences/healthcare industries. Additionally, other C&I loans contain commercial tax-exempt loans to not-for-profit private schools, colleges, public charter schools and other not-for-profit organizations. •Premium wine loans are made to wine producers, vineyards and wine industry or hospitality businesses across the Western United States. A large portion of these loans are secured by real estate collateral such as vineyards and wineries. ▪Other acquired portfolios consist primarily of construction and land loans for financing new developments as well as financing for improvements to existing buildings. These also include community development loans made as part of our responsibilities under the Community Reinvestment Act of 1977, and a small amount of Paycheck Protection Program (“PPP”) loans, which are loans guaranteed by the SBA that were issued through the PPP. Acquired Loans and Leases BancShares’ accounting methods for acquired loans and leases depends on whether or not the loans reflect more than insignificant credit deterioration since origination at the date of acquisition. Non-Purchased Credit Deteriorated Loans and Leases Non-Purchased Credit Deteriorated (“Non-PCD”) loans and leases do not reflect more than insignificant credit deterioration since origination at the date of acquisition. These loans are recorded at fair value and an increase to the ACL is recorded with a corresponding increase to the provision for credit losses at the date of acquisition. The difference between the fair value and the unpaid principal balance (“UPB”) at the acquisition date is amortized or accreted to interest income over the contractual life of the loan using the effective interest method. Purchased Credit Deteriorated Loans and Leases Purchased loans and leases that reflect a more than insignificant credit deterioration since origination at the date of acquisition are classified as PCD loans and leases. PCD loans and leases are recorded at acquisition-date amortized cost, which is the purchase price or fair value in a business combination, plus BancShares' initial ACL, which results in a gross up of the loan balance (the “PCD Gross-Up”). The initial ACL for PCD loans and leases is established through the PCD Gross-Up and there is no corresponding increase to the provision for credit losses. The difference between the UPB and the acquisition date amortized cost resulting from the PCD Gross-Up is amortized or accreted to interest income over the contractual life of the loan using the effective interest method.
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Goodwill | Goodwill BancShares applied the acquisition method of accounting for the SVBB Acquisition and CIT Merger. The fair value of the net assets acquired exceeded the purchase price for each transaction. Consequently, there was a gain on acquisition (and no goodwill) related to the SVBB Acquisition and the CIT Merger. |
Derivative Assets and Liabilities | Derivative Assets and Liabilities Foreign Exchange Contracts SVB has foreign exchange forwards and swaps contracts with clients involved in foreign activities, either as the purchaser or seller, depending upon the clients’ needs. These are structured as back-to-back contracts to mitigate the risk of fluctuations in currency rates. The foreign exchange forward contracts are with correspondent banks to economically reduce our foreign exchange exposure related to certain foreign currency denominated instruments. Equity Warrant Assets In connection with negotiating credit facilities and certain other services, FCB may obtain rights that include an option to purchase a position in a client company's stock in the form of equity warrant assets in primarily private, venture-backed companies in the technology and life science/healthcare industries. These are generally categorized as Level 3 on the fair value hierarchy due to lack of direct observable pricing and a general lack of liquidity due to the private nature of the associated underlying company.
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Noninterest Income | Noninterest Income Refer to Note 1 — Significant Accounting Policies and Basis of Presentation in the 2022 Form 10-K for a discussion on revenue recognition and description of noninterest revenue-generating activities. Descriptions of significant noninterest income new to BancShares due to the SVBB Acquisition are summarized below. Client investment fees Client investment fees are earned from discretionary investment management and related transaction-based services. For discretionary investment management services, revenue is recognized monthly based on the clients’ assets under management. Transaction-based fees are earned on fixed income securities and repurchase agreements when transactions are executed. Amounts paid to third-party providers are not reflected in the transaction price because FCB is an agent for such services. International fees International fees primarily include foreign exchange fees. Foreign exchange fees represent the difference between foreign currency's purchase and sale price in spot contracts. These fees are recognized when contracts are executed with our clients. Fees related to other foreign exchange contracts are recognized outside the scope of Accounting Standards Codification (“ASC 606”) because they are considered derivatives.
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Newly Adopted Accounting Standards | Newly Adopted Accounting Standards BancShares adopted the following accounting standards as of January 1, 2023: ASU 2022-02 Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures- Issued March 2022 (“ASU 2022-02”) The amendments in this ASU: (i) eliminate the previous recognition and measurement guidance for TDRs, (ii) require new disclosures for loan modifications when a borrower is experiencing financial difficulty (the “Modification Disclosures”) and (iii) require disclosures of current period gross charge-offs by year of origination in the vintage disclosures (the “Gross Charge-off Vintage Disclosures”). The Modification Disclosures apply to the following modification types: principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions, or a combination thereof. Creditors are required to disclose the following by loan class: (i) amounts and relative percentages of each modification type, (ii) the financial effect of each modification type, (iii) the performance of the loan in the 12 months following the modification and (iv) qualitative information discussing how the modifications factored into the determination of the ACL. BancShares elected to apply the modified retrospective transition method for ACL recognition and measurement. The adoption of this ASU did not result in a cumulative effect adjustment to retained earnings. The Modification Disclosures and Gross Charge-off Vintage Disclosures are applied prospectively starting in the period of adoption and are presented in Note 4 — Loans and Leases. ASU 2022-01, Fair Value Hedging - Portfolio Layer Method - Issued March 2022The amendments in this ASU allow entities to designate multiple hedged layers of a single closed portfolio and expands the scope of the portfolio layer method to include non-prepayable financial assets. The ASU provides additional guidance on the accounting for and disclosure of hedge basis adjustments under the portfolio layer method. In addition, upon adoption the update permits a one-time reclassification of certain debt securities from the held-to-maturity category to the available-for-sale category if the portfolio layer hedging method is applied to those securities. Upon adoption, we did not make any one-time reclassifications. Adoption of this ASU did not have a material impact on BancShares’ consolidated financial statements and disclosures as BancShares did not have any hedged portfolios.
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Business Combinations (Tables) |
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Business Combination and Asset Acquisition [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions | The following tables provide the purchase price allocation to the identifiable assets acquired and liabilities assumed at their estimated fair values as of the SVBB Acquisition Date. The amounts below reflect Measurement Period adjustments made during the second quarter of 2023, which increased the preliminary after tax gain on acquisition by $55 million. These Measurement Period adjustments primarily relate to refined fair value estimates for acquired affordable housing tax credit investments, loans, and assets and liabilities of acquired SVBB subsidiaries. Purchase Price Consideration; Unaudited Statement of Assets Acquired and Liabilities Assumed
(1) The principal amount of the Purchase Money Note is the book value of net assets acquired of approximately $52.522 billion less the asset discount of $16.450 billion pursuant to the SVBB Purchase Agreement. The $35.808 billion above is net of a fair value discount of approximately $264 million. (2) The difference between the preliminary gain on acquisition before and after taxes reflects the deferred tax liabilities recorded in the SVBB Acquisition, as presented above. Loans and Leases Acquired
The following table summarizes PCD loans and leases that BancShares acquired in the SVBB Acquisition. PCD Loans and Leases
(2) The non-credit discount of $302 million will be accreted into income over the contractual life of the loan using the effective interest method. The following table provides the purchase price allocation to the identifiable assets acquired and liabilities assumed at their estimated fair values as of the Merger Date: Purchase Price Consideration and Net Assets Acquired
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Schedule of Valuation of Core Deposits | The following table presents the intangible asset recorded related to the valuation of core deposits: Intangible Asset
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Schedule of Other Assets Acquired and Other Liabilities Assumed | The following table details other assets acquired: Other Assets
Other liabilities The following table details other liabilities assumed:
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Investment Securities (Tables) |
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Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Amortized Cost and Fair Value of Investment Securities | The following tables include the amortized cost and fair value of investment securities at June 30, 2023 and December 31, 2022. Amortized Cost and Fair Value - Investment Securities
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Schedule of Investment Securities Maturity Information | The following table provides the amortized cost and fair value by contractual maturity. Expected maturities will differ from contractual maturities on certain securities because borrowers and issuers may have the right to call or prepay obligations with or without prepayment penalties. Residential and commercial mortgage-backed and government agency securities are stated separately as they are not due at a single maturity date. Maturities - Debt Securities
(1) Balances as of June 30, 2023 are presented net of the allowance for credit losses of $3 million.
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Schedule of Interest and Dividends on Investment Securities | The following table presents interest and dividend income on investment securities: Interest and Dividends on Investment Securities
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Schedule of Realized Gain (Loss) | The following table presents the gross realized losses on the sales of investment securities available for sale: Realized Losses on Debt Securities Available For Sale
The following table provides the fair value adjustment on marketable equity securities: Fair Value Adjustment on Marketable Equity Securities
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Schedule of Unrealized Loss on Available-for-sale Securities | The following table provides information regarding investment securities available for sale with unrealized losses: Gross Unrealized Losses on Debt Securities Available For Sale
(1) Balances as of June 30, 2023 are presented net of the allowance for credit losses of $3 million.
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Loans and Leases (Tables) |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans by Class | As disclosed in Note 2 — Business Combinations, the following tables and text data as of June 30, 2023 include loans acquired in the SVBB Acquisition. Loans by Class
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Schedule of Amortized Cost of Loans | The following table presents selected components of the amortized cost of loans, including the unamortized discount on acquired loans. Components of Amortized Cost
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Schedule of Loans and Leases Delinquency Status and Nonaccrual Status | The aging of the outstanding loans and leases by class at June 30, 2023 and December 31, 2022 is provided in the tables below. Loans and leases less than 30 days past due are considered current, as various grace periods allow borrowers to make payments within a stated period after the due date and remain in compliance with the respective agreement. Loans and Leases - Delinquency Status
The amortized cost by class of loans and leases on non-accrual status, and loans and leases greater than 90 days past due and still accruing at June 30, 2023 and December 31, 2022 are presented below. Loans on Non-Accrual Status (1) (2)
(1) Accrued interest that was reversed when the loan went to non-accrual status was $5 million for the six months ended June 30, 2023 and $4 million for the year ended December 31, 2022. (2) Non-accrual loans for which there was no related ACL totaled $74 million at June 30, 2023 and $63 million at December 31, 2022. The following tables present the amortized cost and performance of modified loans to borrowers experiencing financial difficulties. The period of delinquency is based on the number of days the scheduled payment is contractually past due. Modified Loans Payment Status (three months ended June 30, 2023)
Modified Loans Payment Status (six months ended June 30, 2023)
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Schedule of Loans Disaggregated by Year of Origination and by Risk Rating | The following tables summarize the commercial and SVB loans disaggregated by year of origination and by risk rating. The consumer loan delinquency status by year of origination is also presented below. The tables reflect the amortized cost of the loans and include PCD loans. Commercial Loans - Risk Classifications by Class
SVB - Risk Classifications by Class
Consumer Loans - Delinquency Status by Class
The following tables represent current credit quality indicators by origination year as of December 31, 2022: Commercial Loans - Risk Classifications by Class
Consumer Loans - Delinquency Status by Class
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Schedule of Troubled Debt Restructuring | Gross charge-off vintage disclosures by origination year and loan class are summarized in the following table for the six months ended June 30, 2023: Gross Charge-offs
The following tables present loan modifications made to debtors experiencing financial difficulty, disaggregated by class and type of loan modification. The tables also include the weighted average term extensions, as well as the modification total relative to the total period-end amortized cost basis of loans in the respective loan class. Loan Modifications Made to Borrowers Experiencing Financial Difficulty (three months ended June 30, 2023)
Loan Modifications Made to Borrowers Experiencing Financial Difficulty (six months ended June 30, 2023)
(1) Term extensions include loans where the balloon payment has been deferred to a later date or is amortizing over an extended period. The following table presents amortized cost of TDRs: TDRs
The following table summarizes the loan restructurings during the three and six months ended June 30, 2022 that were designated as TDRs. BancShares defines payment default as movement of the TDR to non-accrual status, which is generally 90 days past due, foreclosure or charge-off, whichever occurs first. Restructurings
TDR Defaults
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Schedule of Loans Purchased with Credit Deterioration | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Pledged as Collateral | The following table provides information regarding loans pledged as collateral for borrowing capacity through the FHLB of Atlanta and the Federal Reserve Bank (“FRB”) as of June 30, 2023 and December 31, 2022. Loans Pledged
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Allowance for Credit Losses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Allowance for Credit Losses | The ACL activity for loans and leases, unfunded commitments and investment securities is summarized in the following tables. ACL for Loans and Leases
ACL for Unfunded Commitments
ACL for Investment Securities
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Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating and Finance Lease Assets and Liabilities | The following table presents supplemental balance sheet information and remaining weighted average lease terms and discount rates. Supplemental Lease Information
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Schedule of Net Lease Cost | The following table presents components of lease cost: Components of Net Lease Cost
(1) Includes short-term lease cost, which is not significant.
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Schedule of Supplemental Cash Flow Information | The following table presents supplemental cash flow information related to leases: Supplemental Cash Flow Information
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Schedule of Operating Lease Income | The table that follows presents lease income related to BancShares’ operating and finance leases: Lease Income
(1) Primarily includes per diem railcar operating lease rental income earned on a time or mileage usage basis. (2) Includes leased equipment property tax reimbursements due from customers of $3 million and $8 million for the three and six months ended June 30, 2023, respectively, and revenue related to insurance coverage on leased equipment of $10 million and $21 million for the three and six months ended June 30, 2023, respectively. Includes leased equipment property tax reimbursements due from customers of $5 million and $8 million for the three and six months ended June 30, 2022, respectively, and revenue related to insurance coverage on leased equipment of $8 million and $15 million for the three and six months ended June 30, 2022, respectively.
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Goodwill and Core Deposit Intangibles (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Core Deposit Intangible Assets | The following tables summarize the activity for core deposit intangibles during the six months ended June 30, 2023. Core Deposit Intangibles
Core Deposit Intangible Accumulated Amortization
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Schedule of Core Deposit Intangible Assets, Future Amortization Expense | The following table summarizes the expected amortization expense as of June 30, 2023 in subsequent periods for core deposit intangibles. Core Deposit Intangible Expected Amortization
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Variable Interest Entities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entities | The table below provides a summary of the assets and liabilities included on the Consolidated Balance Sheets associated with unconsolidated VIEs. The table also presents our maximum exposure to loss which consists of outstanding book basis and unfunded commitments for future investments, and represents potential losses that would be incurred under hypothetical circumstances, such that the value of BancShares’ interests and any associated collateral declines to zero and assuming no recovery. BancShares believes the possibility is remote under this hypothetical scenario; accordingly, this disclosure is not an indication of expected loss. As disclosed in Note 2 — Business Combinations, the following tables as of June 30, 2023 include VIEs acquired in the SVBB Acquisition. Unconsolidated VIEs Carrying Value
(1) Included in other assets. (2) Represents commitments to invest in qualified affordable housing investments and other investments qualifying for community reinvestment tax credits. These commitments are payable on demand and are included in other liabilities.
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Other Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Assets | Other Assets
(1) Refer to Note 8 — Variable Interest Entities for additional information. (2) The balance at December 31, 2022 included $607 million in “Other” related to bank-owned life insurance policies that had terminated, but not cash-settled. These items cash-settled during 2023.
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Deposits (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Statistical Disclosure for Banks [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Deposit Liabilities Type | The following table provides detail on deposit types. The deposit balances as of June 30, 2023 include those acquired in the SVBB Acquisition, as described in Note 2 — Business Combinations. Deposit Types
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Schedule of Time Deposit Maturities | At June 30, 2023, the scheduled maturities of time deposits were: Deposit Maturities
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Borrowings (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Short-term Borrowings | Short-term borrowings at June 30, 2023 and December 31, 2022 include:
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Schedule of Long-term Borrowings | Long-term borrowings at June 30, 2023 and December 31, 2022 include: Long-term Borrowings
(1) Issued in connection with the SVBB Acquisition and will be secured by acquired loans. See below and Note 2 — Business Combinations for further information. (2) At June 30, 2023 and December 31, 2022, unamortized purchase accounting adjustments were $62 million and $69 million, respectively, for subordinated debentures.
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Derivative Financial Instruments (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments, Offsetting Assets | The following table presents notional amount and fair value of derivative financial instruments on a gross basis. At June 30, 2023, and December 31, 2022 BancShares’ derivatives are not designated as hedging instruments. Notional Amount and Fair Value of Derivative Financial Instruments
(1) Fair value balances include accrued interest. (2) The foreign exchange contracts exclude foreign exchange spot contracts. The notional amounts of these contracts were $161 million as of June 30, 2023, and $0 million as of December 31, 2022. (3) Other derivative contracts not designated as hedging instruments include risk participation agreements and equity warrants. (4) BancShares accounts for swap contracts cleared by the Chicago Mercantile Exchange and LCH Clearnet as “settled-to-market”. As a result, variation margin payments are characterized as settlement of the derivative exposure and variation margin balances are netted against the corresponding derivative mark-to-market balances. Gross amounts of recognized assets and liabilities were lowered by $154 million and $33 million, respectively, at June 30, 2023, and $376 million and $19 million, respectively at December 31, 2022. (5) BancShares’ derivative transactions are governed by International Swaps and Derivatives Association (“ISDA”) agreements that allow for net settlements of certain payments as well as offsetting of all contracts with a given counterparty in the event of bankruptcy or default of one of the two parties to the transaction. BancShares believes its ISDA agreements meet the definition of a master netting arrangement or similar agreement for purposes of the above disclosure. (6) In conjunction with the ISDA agreements described above, BancShares has entered into collateral arrangements with its counterparties, which provide for the exchange of cash depending on change in the market valuation of the derivative contracts outstanding. Such collateral is available to be applied in settlement of the net balances upon an event of default of one of the counterparties. Collateral pledged or received is included in other assets or other liabilities, respectively.
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Schedule of Derivative Instruments, Offsetting Liabilities | The following table presents notional amount and fair value of derivative financial instruments on a gross basis. At June 30, 2023, and December 31, 2022 BancShares’ derivatives are not designated as hedging instruments. Notional Amount and Fair Value of Derivative Financial Instruments
(1) Fair value balances include accrued interest. (2) The foreign exchange contracts exclude foreign exchange spot contracts. The notional amounts of these contracts were $161 million as of June 30, 2023, and $0 million as of December 31, 2022. (3) Other derivative contracts not designated as hedging instruments include risk participation agreements and equity warrants. (4) BancShares accounts for swap contracts cleared by the Chicago Mercantile Exchange and LCH Clearnet as “settled-to-market”. As a result, variation margin payments are characterized as settlement of the derivative exposure and variation margin balances are netted against the corresponding derivative mark-to-market balances. Gross amounts of recognized assets and liabilities were lowered by $154 million and $33 million, respectively, at June 30, 2023, and $376 million and $19 million, respectively at December 31, 2022. (5) BancShares’ derivative transactions are governed by International Swaps and Derivatives Association (“ISDA”) agreements that allow for net settlements of certain payments as well as offsetting of all contracts with a given counterparty in the event of bankruptcy or default of one of the two parties to the transaction. BancShares believes its ISDA agreements meet the definition of a master netting arrangement or similar agreement for purposes of the above disclosure. (6) In conjunction with the ISDA agreements described above, BancShares has entered into collateral arrangements with its counterparties, which provide for the exchange of cash depending on change in the market valuation of the derivative contracts outstanding. Such collateral is available to be applied in settlement of the net balances upon an event of default of one of the counterparties. Collateral pledged or received is included in other assets or other liabilities, respectively.
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Schedule of Non-Qualifying Hedges | The following table presents gains of non-qualifying hedges recognized on the Consolidated Statements of Income: Gains on Non-Qualifying Hedges
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Other Liabilities (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Liabilities | Other Liabilities
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Fair Value (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes BancShares’ assets and liabilities measured at estimated fair value on a recurring basis: Assets and Liabilities Measured at Fair Value - Recurring Basis
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Schedule of Fair Value Measurement Inputs and Valuation Techniques | The following tables summarize information about significant unobservable inputs related to BancShares’ categories of Level 3 financial assets and liabilities measured on a recurring basis: Quantitative Information About Level 3 Fair Value Measurements - Recurring Basis
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Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following table summarizes the changes in estimated fair value for all assets and liabilities measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3): Changes in Estimated Fair Value of Level 3 Financial Assets and Liabilities - Recurring Basis
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Schedule of Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table summarizes the changes in estimated fair value for all assets and liabilities measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3): Changes in Estimated Fair Value of Level 3 Financial Assets and Liabilities - Recurring Basis
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Schedule of Fair Value Option | The following table summarizes the difference between the aggregate fair value and the UPB for residential real estate loans originated for sale measured at fair value as of June 30, 2023 and December 31, 2022: Aggregate Fair Value and UPB - Residential Real Estate Loans
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Schedule of Fair Value, Assets Measured on Nonrecurring Basis | The following table presents carrying value of assets measured at estimated fair value on a non-recurring basis for which gains and losses have been recorded in the periods. The gains and losses reflect amounts recorded for the respective periods, regardless of whether the asset is still held at period end. Assets Measured at Fair Value - Non-recurring Basis
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Schedule of Carrying Values and Estimated Fair Values for Financial Instruments | The table below presents the carrying values and estimated fair values for financial instruments, excluding leases and certain other assets and liabilities for which these disclosures are not required. Carrying Values and Fair Values of Financial Assets and Liabilities
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Stockholders' Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Common Stock Outstanding Roll Forward | A roll forward of common stock activity is presented in the following table: Number of Shares of Common Stock
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Schedule of Preferred Stock and Depositary Shares | The following table summarizes BancShares’ non-cumulative perpetual preferred stock. Preferred Stock
(1) Beginning July 1, 2023, BancShares has moved to Term SOFR plus a credit spread adjustment for its Series B Preferred Stock. The final dividend payment based on a LIBOR accrual will occur September 15, 2023.
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Accumulated Other Comprehensive (Loss) Income (Tables) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive (Loss) Income | The following table details the components of Accumulated Other Comprehensive (Loss) Income (“AOCI”): Components of Accumulated Other Comprehensive (Loss) Income
The following table details the changes in the components of AOCI, net of income taxes: Changes in Accumulated Other Comprehensive (Loss) Income by Component
Other Comprehensive Income (Loss) by Component
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Regulatory Capital (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Compliance with Regulatory Capital Requirements | The following table includes the Basel III requirements for regulatory capital ratios.
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Earnings Per Common Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of the basic and diluted earnings per common share: Earnings per Common Share
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Employee Benefit Plans (Tables) |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Benefit Costs | The components of net periodic benefit cost are as follows:
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Business Segment Information (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following table presents the condensed income statement by segment:
|
Commitments and Contingencies (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Off-balance Sheet Risks | The accompanying table summarizes credit-related commitments and other purchase and funding commitments:
(1) BancShares’ purchase and funding commitments relate to the equipment leasing businesses’ commitments to fund finance leases and operating leases, and Rail’s railcar manufacturer purchase and upgrade commitments.
|
Significant Accounting Policies and Basis of Presentation (Details) |
Jun. 30, 2023
loan
|
---|---|
Accounting Policies [Abstract] | |
Number of branches (more than) | 560 |
Number of states in which entity operates | 23 |
Business Combinations - Schedule of Unpaid Balance and Fair Value of the Acquired Loan Portfolio (Details) - SVB $ in Millions |
Mar. 27, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
UPB | $ 71,287 |
Loans and Leases, FV | 68,460 |
Non-PCD | |
Business Acquisition [Line Items] | |
UPB | 68,729 |
Loans and Leases, FV | 66,424 |
PCD | |
Business Acquisition [Line Items] | |
UPB | 2,558 |
Loans and Leases, FV | $ 2,036 |
Business Combinations - Schedule of PCD Loans and Leases Acquired (Details) - SVB $ in Millions |
Mar. 27, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
UPB | $ 71,287 |
Fair value | 68,460 |
PCD | |
Business Acquisition [Line Items] | |
UPB | 2,558 |
Fair value | 2,036 |
Fair value discount | 522 |
PCD gross-up | (220) |
Non-credit discount | $ 302 |
Business Combinations - Schedule of Valuation of Core Deposits (Details) - Core Deposits - SVB $ in Millions |
Mar. 27, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Fair Value | $ 230 |
Estimated Useful Life | 8 years |
Business Combinations - Schedule of Other Assets Acquired (Details) - SVB $ in Millions |
Mar. 27, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Accrued interest receivable | $ 428 |
Federal Home Loan Bank stock / Federal Reserve Bank stock | 320 |
Fair value of derivative financial instruments, net | 197 |
Other | 341 |
Total other assets | $ 1,286 |
Business Combinations - Schedule of Other Liabilities Assumed (Details) - SVB $ in Millions |
Mar. 27, 2023
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Commitments to fund tax credit investments | $ 715 |
Fair value of derivative financial instruments, net | 336 |
Accrued expenses and accounts payable | 262 |
Reserve for off-balance sheet credit exposures | 253 |
Accrued interest payable | 113 |
Other | 203 |
Other liabilities | $ 1,882 |
Investment Securities - Schedule of Interest and Dividends on Investment Securities (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investments [Abstract] | ||||
Interest income - taxable investment securities | $ 118 | $ 89 | $ 224 | $ 171 |
Interest income - nontaxable investment securities | 2 | 0 | 2 | 0 |
Dividend income - marketable equity securities | 0 | 0 | 1 | 1 |
Interest on investment securities | $ 120 | $ 89 | $ 227 | $ 172 |
Investment Securities - Schedule of Realized Gain (Loss) From Available-for-sale Securities (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investments [Abstract] | ||||
Gross realized gains on sales of investment securities available for sale | $ 0 | $ 0 | $ 0 | $ 0 |
Gross realized losses on sales of investment securities available for sale | 0 | 0 | (14) | 0 |
Net realized losses on sales of investment securities available for sale | $ 0 | $ 0 | $ (14) | $ 0 |
Investment Securities - Schedule of Marketable Equity Securities Gains (Losses) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investments [Abstract] | ||||
Fair value adjustment on marketable equity securities, net | $ (10) | $ (6) | $ (19) | $ (3) |
Loans and Leases - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Mar. 27, 2023 |
Jun. 30, 2023 |
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Receivables [Abstract] | ||||
Financing receivable, accrued interest receivable | $ 601.0 | $ 601.0 | $ 203.0 | |
Financing receivable, amortization of purchase discount | $ 243.0 | $ 260.0 | ||
Financing receivable, threshold period past due | 30 days | 30 days | ||
Other real estate owned | $ 64.0 | $ 64.0 | 47.0 | |
Financing receivable, troubled debt restructuring, commitment to lend | $ 12.0 | $ 12.0 | $ 1.5 | |
SVB | FDIC Credit Facility | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Debt instrument, term | 5 years | |||
FDIC advances, maximum amount available | $ 70,000.0 |
Loans and Leases - Schedule of Amortized Cost of Loans (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total net unamortized discount | $ 2,478 | $ 118 |
Non-PCD | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Deferred (fees) costs, including unamortized costs and unearned fees on non-PCD loans | (17) | 34 |
Total net unamortized discount | 2,202 | 73 |
PCD | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total net unamortized discount | $ 276 | $ 45 |
Loans and Leases - Schedule of Troubled Debt Restructuring Modifications (Details) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2022
USD ($)
loan
|
Jun. 30, 2022
USD ($)
loan
|
|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Loans | loan | 90 | 171 |
Amortized Cost at Period End | $ | $ 15 | $ 38 |
Interest only | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Loans | loan | 6 | 8 |
Amortized Cost at Period End | $ | $ 6 | $ 6 |
Term Extension | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Loans | loan | 41 | 76 |
Amortized Cost at Period End | $ | $ 4 | $ 23 |
Below market rates | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Loans | loan | 25 | 45 |
Amortized Cost at Period End | $ | $ 3 | $ 5 |
Discharge from bankruptcy | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of Loans | loan | 18 | 42 |
Amortized Cost at Period End | $ | $ 2 | $ 4 |
Loans and Leases - Schedule of Troubled Debt that Defaulted Subsequently (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2022 |
|
Receivables [Abstract] | ||
Troubled debt restructuring, subsequently defaulted | $ 1 | $ 3 |
Loans and Leases - Schedule of Loans Pledged as Collateral (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|---|
Federal Reserve Bank [Abstract] | |||
Pledged non-PCD loans (contractual balance) | $ 133,015,000 | $ 70,781,000 | $ 67,735,000 |
FHLB of Atlanta | Non-PCD | Asset Pledged as Collateral | |||
FHLB of Atlanta | |||
Lendable collateral value of pledged non-PCD loans | 14,999,000 | 14,918,000 | |
Less: Advances | 2,425,000 | 4,250,000 | |
Less: Letters of Credit | 1,450,000 | 1,450,000 | |
Available borrowing capacity | 11,124,000 | 9,218,000 | |
Federal Reserve Bank [Abstract] | |||
Pledged non-PCD loans (contractual balance) | 23,969,000 | 23,491,000 | |
FRB | Non-PCD | Asset Pledged as Collateral | |||
Federal Reserve Bank [Abstract] | |||
Lendable collateral value of pledged non-PCD loans | 4,817,000 | 4,203,000 | |
Less: Advances | 0 | 0 | |
Available borrowing capacity | 4,817,000 | 4,203,000 | |
Pledged non-PCD loans (contractual balance) | $ 5,995,000 | $ 5,697,000 |
Allowance for Credit Losses - Schedule of Allowance for Investment Securities (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit losses, beginning balance | $ 1,605 | $ 848 | $ 922 | $ 178 |
Provision for credit losses | 151 | 42 | 934 | 506 |
Allowance for credit losses, ending balance | 1,637 | 850 | 1,637 | 850 |
Available-for-Sale Securities | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Allowance for credit losses, beginning balance | 4 | 0 | 0 | 0 |
Provision for credit losses | (1) | 0 | 3 | 0 |
Allowance for credit losses, ending balance | $ 3 | $ 0 | $ 3 | $ 0 |
Leases - Narrative (Details) - Maximum |
Jun. 30, 2023 |
---|---|
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract (up to) | 16 years |
Excessive Building Space No Longer Utilizing | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, term of contract (up to) | 13 years |
Leases - Schedule of Net Lease Cost (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Lease cost | ||||
Operating lease cost | $ 15,000 | $ 15,000 | $ 28,000 | $ 30,000 |
Finance lease cost | ||||
Amortization of leased assets | 0 | 1,000 | 1,000 | 1,000 |
Variable lease cost | 4,000 | 3,000 | 7,000 | 6,000 |
Sublease income | (1,000) | (1,000) | (1,000) | (1,000) |
Net lease cost | $ 18,000 | $ 18,000 | $ 35,000 | $ 36,000 |
Leases - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Operating cash flows from operating leases | ||
Operating cash flows from operating leases | $ 28 | $ 26 |
Financing cash flows from finance leases | 1 | 1 |
ROU assets obtained in exchange for new operating lease liabilities | $ 10 | $ 15 |
Leases - Schedule of Operating Lease Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Leases [Abstract] | ||||
Lease income – Operating leases | $ 221 | $ 196 | $ 435 | $ 391 |
Variable lease income – Operating leases | 17 | 17 | 36 | 30 |
Rental income on operating leases | 238 | 213 | 471 | 421 |
Interest income - Sales type and direct financing leases | 43 | 42 | 84 | 84 |
Variable lease income included in Other noninterest income | 14 | 13 | 28 | 23 |
Interest income - Leveraged leases | 4 | 5 | 9 | 9 |
Total lease income | 299 | 273 | 592 | 537 |
Property tax reimbursement due from customer | 3 | 5 | 8 | 8 |
Variable lease, income related to insurance coverage | $ 10 | $ 8 | $ 21 | $ 15 |
Goodwill and Core Deposit Intangibles - Narrative (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 346 | $ 346 |
Goodwill and Core Deposit Intangibles - Schedule of Changes in Core Deposit Intangibles (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Finite-lived Intangible Assets [Roll Forward] | ||||
Amortization for the period | $ 18 | $ 6 | $ 23 | $ 12 |
Core Deposits | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Core deposit intangibles, beginning balance | 140 | |||
Amortization for the period | (23) | |||
Core deposit intangibles, ending balance | $ 347 | 347 | ||
Core Deposits | SVB | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Core deposit intangibles related to the SVBB Acquisition | $ 230 |
Goodwill and Core Deposit Intangibles - Schedule of Gross Carrying Amount and Accumulated Amortization of Core Deposit Intangibles (Details) - Core Deposits - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross balance | $ 501 | $ 271 |
Accumulated amortization | (154) | (131) |
Balance, net of accumulated amortization | $ 347 | $ 140 |
Goodwill and Core Deposit Intangibles - Schedule of Core Deposit Intangibles, Future Amortization Expense (Details) - Core Deposits $ in Millions |
Jun. 30, 2023
USD ($)
|
---|---|
Finite-Lived Intangible Assets [Line Items] | |
Remainder 2023 | $ 34 |
2024 | 63 |
2025 | 54 |
2026 | 46 |
2027 | 39 |
2028 | 35 |
Thereafter | 76 |
Balance, net of accumulated amortization | $ 347 |
Variable Interest Entities - Narrative (Details) - entity |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Variable interest entity, consolidated, number of entities | 0 | 0 |
Other Assets - Components of Other Assets (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Affordable housing tax credit and other unconsolidated investments | $ 2,010 | $ 762 |
Right of use assets for operating leases, net | 360 | 345 |
Pension assets | 359 | 343 |
Accrued interest receivable | 732 | 329 |
Income tax receivable | 208 | 275 |
Federal Home Loan Bank stock | 119 | 197 |
Fair value of derivative financial instruments | 758 | 159 |
Bank-owned life insurance | 104 | 586 |
Counterparty receivables | 113 | 98 |
Nonmarketable equity securities | 58 | 58 |
Other real estate owned | 62 | 47 |
Mortgage servicing rights | 25 | 25 |
Other | 861 | 1,145 |
Total other assets | $ 5,769 | 4,369 |
Other Assets, Miscellaneous | ||
Other Assets [Line Items] | ||
Bank owned life insurance, amount terminated but not cash-settled | $ 607 |
Deposits - Schedule of Deposit Liabilities Type (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 30, 2022 |
---|---|---|---|
Statistical Disclosure for Banks [Abstract] | |||
Noninterest-bearing | $ 44,547,000 | $ 24,922,000 | |
Checking with interest | 24,809,000 | 16,202,000 | |
Money market | 29,149,000 | 21,040,000 | |
Savings | 26,389,000 | 16,634,000 | |
Time | 16,270,000 | 10,610,000 | |
Total deposits | $ 141,164,000 | $ 89,408,000 | $ 89,329,000 |
Deposits - Schedule of Time Deposit Maturities (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statistical Disclosure for Banks [Abstract] | ||
2024 | $ 13,744 | |
2025 | 2,042 | |
2026 | 286 | |
2027 | 50 | |
2028 | 23 | |
Thereafter | 125 | |
Total time deposits | $ 16,270 | $ 10,610 |
Deposits - Narrative (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statistical Disclosure for Banks [Abstract] | ||
Time deposits with a denomination of $250,000 or more | $ 4,950 | $ 2,220 |
Borrowings - Schedule of Short-term Borrowings (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Debt Disclosure [Abstract] | ||
Securities sold under customer repurchase agreements | $ 454 | $ 436 |
Notes payable to FHLB of Atlanta at overnight SOFR plus 0.28%. | 0 | 1,750 |
Total short-term borrowings | $ 454 | $ 2,186 |
Short-Term Notes Payable | Secured Overnight Financing Rate (SOFR) | ||
Short-term Debt [Line Items] | ||
Basis spread on variable rate | 0.28% |
Derivative Financial Instruments - Schedule of Derivative Instruments Non-Qualifying Hedges (Details) - Not Designated as Hedging Instrument - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gains (losses) of non-qualifying hedges | $ 9 | $ 8 | $ 28 | $ 12 |
Interest rate contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gains (losses) of non-qualifying hedges | 8 | 2 | 29 | 6 |
Foreign currency forward contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gains (losses) of non-qualifying hedges | $ 1 | $ 6 | $ (1) | $ 6 |
Other Liabilities - Schedule of Other Liabilities (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Other Liabilities Disclosure [Abstract] | ||
Fair value of derivative financial instruments | $ 825 | $ 486 |
Lease liabilities | 368 | 352 |
Accrued expenses and accounts payable | 391 | 275 |
Commitments to fund tax credit investments | 926 | 295 |
Deferred taxes | 3,147 | 286 |
ACL for unfunded commitments | 335 | 106 |
Incentive plan liabilities | 369 | 267 |
Accrued interest payable | 121 | 57 |
Other | 879 | 464 |
Total other liabilities | $ 7,361 | $ 2,588 |
Fair Value - Schedule of Fair Value Option (Details) - Originated loans held for sale - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Loans held for sale | $ 42 | $ 4 |
Unpaid Principal Balance | 42 | 4 |
Difference | $ 0 | $ 0 |
Fair Value - Narrative (Details) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023
USD ($)
|
Jun. 30, 2022
USD ($)
|
Jun. 30, 2023
USD ($)
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
|
Fair Value Disclosures [Abstract] | |||||
Fair value, option, changes in fair value, gain (loss) | $ 0 | $ 1,000,000 | $ 0 | $ (2,000,000) | |
Fair value, option, loans held as assets, 90 days or more past due | 0 | 0 | $ 0 | ||
Fair Value, option, loans held as assets, aggregate amount in nonaccrual status | $ 0 | $ 0 | $ 0 | ||
Measurement Input, Discount Rate | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Financing receivable, measurement input | 0.0868 | 0.0868 | 0.0931 | ||
Minimum | Measurement Input, Discount Rate | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Financing receivable, measurement input | 0.06 | 0.06 | |||
Maximum | Measurement Input, Discount Rate | |||||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||||
Financing receivable, measurement input | 0.11 | 0.11 |
Stockholders' Equity - Schedule of Common Stock Outstanding Roll Forward (Details) - shares |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2023 |
|
Class A Common Stock | ||
Increase (Decrease) In Common Stock [Roll Forward] | ||
Common stock beginning balance (in shares) | 13,514,808 | 13,501,017 |
Restricted stock units vested, net of shares held to cover taxes (in shares) | 41 | 13,832 |
Common stock ending balance (in shares) | 13,514,849 | 13,514,849 |
Class B Common Stock | ||
Increase (Decrease) In Common Stock [Roll Forward] | ||
Common stock beginning balance (in shares) | 1,005,185 | 1,005,185 |
Restricted stock units vested, net of shares held to cover taxes (in shares) | 0 | 0 |
Common stock ending balance (in shares) | 1,005,185 | 1,005,185 |
Stockholders' Equity - Narrative (Details) |
Jun. 30, 2023
shares
|
Apr. 25, 2023
shares
|
Apr. 24, 2023
shares
|
Dec. 31, 2022
shares
|
---|---|---|---|---|
Class of Stock [Line Items] | ||||
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 | 10,000,000 | 10,000,000 |
Class A Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, voting right per share | 1 | |||
Common stock, shares authorized (in shares) | 32,000,000 | 32,000,000 | 16,000,000 | 16,000,000 |
Class B Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, voting right per share | 16 | |||
Common stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Accumulated Other Comprehensive (Loss) Income - Schedule of Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Pretax | $ (1,018) | $ (967) |
Income Taxes | 246 | 232 |
Net of Income Taxes | (772) | (735) |
Unrealized loss on securities available for sale | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Pretax | (1,029) | (972) |
Income Taxes | 248 | 233 |
Net of Income Taxes | (781) | (739) |
Unrealized loss on securities available for sale transferred to held to maturity | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Pretax | (7) | (8) |
Income Taxes | 2 | 2 |
Net of Income Taxes | (5) | (6) |
Defined benefit pension items | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Pretax | 18 | 13 |
Income Taxes | (4) | (3) |
Net of Income Taxes | $ 14 | $ 10 |
Regulatory Capital - Schedule of Regulatory Capital Ratio (Details) |
Jun. 30, 2023 |
---|---|
Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | |
Basel III Minimums, Total risk-based capital | 0.0800 |
Basel III Minimums, Tier 1 risk-based capital | 0.0600 |
Basel III Minimums, Common equity Tier 1 | 0.0450 |
Basel III Minimums, Tier 1 leverage | 0.0400 |
Basel III Requirements, Total risk-based capital | 0.1050 |
Basel III Requirements, Tier 1 risk-based capital | 0.0850 |
Basel III Requirements, Common equity Tier 1 | 0.0700 |
Basel III Requirements, Tier 1 leverage | 0.0400 |
Regulatory Capital - Narrative (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Capital conservation buffer | 7.84% | 5.06% |
FCB | ||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | ||
Capital conservation buffer | 7.69% | 4.99% |
Dividend restrictions, additional maximum amount of distribution | $ 8,090 | |
Payments of dividends | $ 117 |
Earnings Per Common Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Earnings Per Share [Abstract] | ||||
Net income | $ 682 | $ 255 | $ 10,200 | $ 526 |
Preferred stock dividends | 15 | 17 | 29 | 24 |
Net income available to common stockholders, basic | 667 | 238 | 10,171 | 502 |
Net income available to common shareholders, diluted | $ 667 | $ 238 | $ 10,171 | $ 502 |
Weighted average common shares outstanding | ||||
Weighted average common shares outstanding, basic (in shares) | 14,528,134 | 16,023,613 | 14,527,417 | 15,918,978 |
Stock-based award (in shares) | 9,804 | 11,477 | 11,759 | 18,848 |
Weighted average common shares outstanding, diluted (in shares) | 14,537,938 | 16,035,090 | 14,539,176 | 15,937,826 |
Earnings per common share, basic (in dollars per share) | $ 45.90 | $ 14.87 | $ 700.10 | $ 31.52 |
Earnings per common share, diluted (in dollars per share) | $ 45.87 | $ 14.86 | $ 699.53 | $ 31.48 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Mar. 27, 2023 |
Dec. 31, 2022 |
|
Income Tax Disclosure [Abstract] | |||||||
Effective income tax rate | 23.90% | 24.20% | 1.60% | 6.30% | |||
Business Acquisition [Line Items] | |||||||
Deferred tax assets, valuation allowance | $ 70 | ||||||
SVB | |||||||
Business Acquisition [Line Items] | |||||||
Deferred tax liabilities | $ 3,280 | $ 3,280 | $ 3,280 | $ 3,277 | |||
Decrease in valuation allowance due to measurement period adjustment | $ 12 |
Employee Benefit Plans - Schedule of Net Benefit Costs (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Retirement Benefits [Abstract] | ||||
Service cost | $ 3,000 | $ 4,000 | $ 5,000 | $ 7,000 |
Interest cost | 15,000 | 11,000 | 30,000 | 22,000 |
Expected return on assets | (22,000) | (22,000) | (43,000) | (44,000) |
Amortization of prior service cost | 0 | 0 | 0 | 0 |
Amortization of net actuarial loss | 0 | 3,000 | 0 | 6,000 |
Net periodic benefit | $ (4,000) | $ (4,000) | $ (8,000) | $ (9,000) |
Commitments and Contingencies - Schedule of Fair Value, Off-balance Sheet Risks (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Financing assets (excluding leases) | ||
Other Commitments [Line Items] | ||
Credit related commitments | $ 69,292 | $ 23,452 |
Standby letters of credit | ||
Other Commitments [Line Items] | ||
Credit related commitments | 3,090 | 436 |
Other letters of credit | ||
Other Commitments [Line Items] | ||
Credit related commitments | 107 | 44 |
Deferred Purchase Agreements | ||
Other Commitments [Line Items] | ||
Credit related commitments | 1,531 | 2,039 |
Lessor commitments | ||
Other Commitments [Line Items] | ||
Credit related commitments | $ 672 | $ 941 |
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Other Commitments [Line Items] | ||
Deferred purchase agreement, borrowings by client | $ 136 | $ 186 |
Deferred purchase agreement, receivables with credit risk | 1,350 | 1,900 |
Deferred purchase agreement, line of credit facility, maximum borrowing capacity | 186 | 138 |
Loss contingency (up to) | 10 | |
Off-Balance Sheet Commitment | ||
Other Commitments [Line Items] | ||
Credit related commitments | $ 69 | $ 66 |