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Derivative Financial Instruments
 3 Months Ended
Mar. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Impact of Derivatives on the Consolidated Balance Sheets

The following table presents the gross notional amounts and estimated fair value of derivative instruments employed by the Company. Truist held no cash flow hedges as of March 31, 2021 and December 31, 2020.
 March 31, 2021December 31, 2020
 Notional AmountFair ValueNotional AmountFair Value
(Dollars in millions)AssetsLiabilitiesAssetsLiabilities
Fair value hedges:   
Interest rate contracts:   
Swaps hedging AFS securities$19,809 $— $— $17,765 $— $— 
Not designated as hedges:      
Client-related and other risk management:      
Interest rate contracts:      
Swaps154,617 2,394 (843)156,338 3,399 (862)
Options25,598 39 (15)25,386 45 (18)
Forward commitments4,033 17 (8)4,847 9 (11)
Other2,091 — — 2,573 — — 
Equity contracts28,298 1,702 (2,189)31,152 1,856 (2,297)
Credit contracts:
Loans and leases1,120 — (4)1,056 — (5)
Risk participation agreements7,743 1 (10)7,802 1 (13)
Total return swaps1,355 3 (30)1,296 13 (33)
Foreign exchange contracts12,185 131 (105)12,066 189 (219)
Commodity3,688 239 (232)2,872 130 (124)
Total240,728 4,526 (3,436)245,388 5,642 (3,582)
Mortgage banking:      
Interest rate contracts:      
Swaps686 — — 687 — — 
Interest rate lock commitments6,371 47 (47)8,609 186 (3)
When issued securities, forward rate agreements and forward commitments
11,185 204 (17)11,691 6 (73)
Other530 2 — 466 — — 
Total18,772 253 (64)21,453 192 (76)
MSRs:      
Interest rate contracts:      
Swaps26,510 — — 36,161 — (5)
Options101 2 — 101 — — 
When issued securities, forward rate agreements and forward commitments
2,008 — (24)1,314 7 — 
Other3,683 — — 760 — — 
Total32,302 2 (24)38,336 7 (5)
Total derivatives not designated as hedges291,802 4,781 (3,524)305,177 5,841 (3,663)
Total derivatives$311,611 4,781 (3,524)$322,942 5,841 (3,663)
Gross amounts in the Consolidated Balance Sheets:    
Amounts subject to master netting arrangements
(1,471)1,471  (1,561)1,561 
Cash collateral (received) posted for amounts subject to master netting arrangements
 (384)1,349  (443)1,547 
Net amount $2,926 $(704) $3,837 $(555)
The following table presents the offsetting of derivative instruments including financial instrument collateral related to legally enforceable master netting agreements and amounts held or pledged as collateral. U.S. GAAP does not permit netting of non-cash collateral balances in the Consolidated Balance Sheets:
March 31, 2021
(Dollars in millions)		Gross AmountAmount OffsetNet Amount in Consolidated Balance SheetsHeld/Pledged Financial InstrumentsNet Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement$3,931 $(1,855)$2,076 $(2)$2,074 
Derivatives not subject to master netting arrangement or similar arrangement467 — 467 — 467 
Exchange traded derivatives383 — 383 — 383 
Total derivative assets$4,781 $(1,855)$2,926 $(2)$2,924 
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement$(3,236)$2,815 $(421)$43 $(378)
Derivatives not subject to master netting arrangement or similar arrangement(288)5 (283)— (283)
Total derivative liabilities$(3,524)$2,820 $(704)$43 $(661)
December 31, 2020
(Dollars in millions)		Gross AmountAmount OffsetNet Amount in Consolidated Balance SheetsHeld/Pledged Financial InstrumentsNet Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement$4,383 $(1,618)$2,765 $(2)$2,763 
Derivatives not subject to master netting arrangement or similar arrangement705 — 705 (1)704 
Exchange traded derivatives753 (386)367 — 367 
Total derivative assets$5,841 $(2,004)$3,837 $(3)$3,834 
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement$(3,103)$2,722 $(381)$35 $(346)
Derivatives not subject to master netting arrangement or similar arrangement(174)— (174)— (174)
Exchange traded derivatives(386)386 — — — 
Total derivative liabilities$(3,663)$3,108 $(555)$35 $(520)

The following table presents the carrying value of hedged items in fair value hedging relationships:
March 31, 2021December 31, 2020
Hedge Basis AdjustmentHedge Basis Adjustment
(Dollars in millions)Hedged Asset / Liability BasisItems Currently DesignatedDiscontinued HedgesHedged Asset / Liability BasisItems Currently DesignatedDiscontinued Hedges
AFS securities (1)$101,804 $(557)$48 $100,988 $(33)$50 
Loans and leases463 — 17 470 — 18 
Long-term debt24,924 — 848 27,725 — 930 
(1)The amortized cost of AFS securities was $103.2 billion at March 31, 2021 and $99.4 billion at December 31, 2020.
Impact of Derivatives on the Consolidated Statements of Income and Comprehensive Income

Derivatives Designated as Hedging Instruments under GAAP

No portion of the change in fair value of derivatives designated as hedges has been excluded from effectiveness testing.

The following table summarizes amounts related to cash flow hedges, which consist of interest rate contracts.
Three Months Ended March 31,
(Dollars in millions)20212020
Pre-tax gain (loss) recognized in OCI:
Deposits$— $— 
Short-term borrowings— — 
Long-term debt— — 
Total$— $— 
Pre-tax gain (loss) reclassified from AOCI into interest expense:
Deposits$(1)$(2)
Short-term borrowings(5)(4)
Long-term debt(5)(8)
Total$(11)$(14)
Pre-tax gain (loss) reclassified from AOCI into other expense: (1)
Deposits$(12)$— 
Short-term borrowings(20)— 
Long-term debt(4)
Total$(36)$— 
(1)Represents the accelerated amortization of amounts reclassified from AOCI, where management determined that the forecasted transaction is probable of not occurring.

The following table summarizes the impact on net interest income related to fair value hedges:
Three Months Ended March 31,
(Dollars in millions)20212020
AFS securities:
Amounts related to interest settlements$(11)$— 
Recognized on derivatives524 — 
Recognized on hedged items
(526)(2)
Net income (expense) recognized(13)(2)
Loans and leases:
Recognized on derivatives— (3)
Recognized on hedged items
(1)2 
Net income (expense) recognized(1)(1)
Long-term debt:
Amounts related to interest settlements— 16 
Recognized on derivatives— 922 
Recognized on hedged items
79 (922)
Net income (expense) recognized79 16 
Net income (expense) recognized, total
$65 $13 

The following table presents information about the Company’s cash flow and fair value hedges:
(Dollars in millions)Mar 31, 2021Dec 31, 2020
Cash flow hedges:
Net unrecognized after-tax gain (loss) on terminated hedges recorded in AOCI (to be recognized in earnings through 2022)
$(28)$(64)
Estimated portion of net after-tax gain (loss) on active and terminated hedges to be reclassified from AOCI into earnings during the next 12 months
(24)(42)
Fair value hedges:
Unrecognized pre-tax net gain (loss) on terminated hedges (to be recognized as interest primarily through 2029)
$783 $862 
Portion of pre-tax net gain (loss) on terminated hedges to be recognized as a change in interest during the next 12 months
271 292 
Derivatives Not Designated as Hedging Instruments under GAAP

The Company also enters into derivatives that are not designated as accounting hedges under GAAP to economically hedge certain risks as well as in a trading capacity with its clients.

The following table presents pre-tax gain (loss) recognized in income for derivative instruments not designated as hedges:
Three Months Ended March 31,
(Dollars in millions)Income Statement Location20212020
Client-related and other risk management:
Interest rate contractsInvestment banking and trading income and other income$102 $(64)
Foreign exchange contractsInvestment banking and trading income and other income26 107 
Equity contractsInvestment banking and trading income and other income(8)(10)
Credit contractsInvestment banking and trading income and other income(34)459 
Commodity contractsInvestment banking and trading income2 3 
Mortgage banking:  
Interest rate contractsResidential mortgage income91 (122)
Interest rate contractsCommercial real estate related income(1)2 
MSRs:  
Interest rate contractsResidential mortgage income(333)495 
Interest rate contractsCommercial real estate related income(12)20 
Total$(167)$890 

Credit Derivative Instruments

As part of the Company’s corporate investment banking business, the Company enters into contracts that are, in form or substance, written guarantees; specifically, credit default swaps, risk participations, and TRS. The Company accounts for these contracts as derivatives.

The Company has entered into TRS contracts on loans. To mitigate its credit risk, the Company typically receives initial margin from the counterparty upon entering into the TRS and variation margin if the fair value of the underlying reference assets deteriorates. For additional information on the Company’s TRS contracts, see “Note 13. Commitments and Contingencies.”

Truist has entered into risk participation agreements to share the credit exposure with other financial institutions on client-related interest rate derivative contracts. Under these agreements, the Company has guaranteed payment to a dealer counterparty in the event the counterparty experiences a loss on the derivative due to a failure to pay by the counterparty’s client. The Company manages its payment risk on its risk participations by monitoring the creditworthiness of the underlying client through the normal credit review process that the Company would have performed had it entered into a derivative directly with the obligors. At March 31, 2021, the remaining terms on these risk participations ranged from less than one year to 10 years. The potential future exposure represents the Company’s maximum estimated exposure to written risk participations, as measured by projecting a maximum value of the guaranteed derivative instruments based on scenario simulations and assuming 100 percent default by all obligors on the maximum value.

The following table presents additional information related to interest rate derivative risk participation agreements and total return swaps:
(Dollars in millions)Mar 31, 2021Dec 31, 2020
Risk participation agreements:
Maximum potential amount of exposure
$503 $530 
Total return swaps:
Cash collateral held345 374 
The following table summarizes collateral positions with counterparties:
(Dollars in millions)Mar 31, 2021Dec 31, 2020
Dealer and other counterparties:  
Cash and other collateral received from counterparties$387 $446 
Derivatives in a net gain position secured by collateral received565 585 
Unsecured positions in a net gain with counterparties after collateral postings
46 49 
Cash collateral posted to dealer counterparties1,392 1,524 
Derivatives in a net loss position secured by collateral1,484 1,604 
Additional collateral that would have been posted had the Company’s credit ratings dropped below investment grade
3 3 
Central counterparties clearing:
Cash collateral, including initial margin, posted to central clearing parties52 172 
Derivatives in a net loss position10 90 
Derivatives in a net gain position2 5 
Securities pledged to central counterparties clearing1,223 1,281