v3.25.1
Loan Servicing
 3 Months Ended
Mar. 31, 2025
Transfers and Servicing [Abstract]  
Loan Servicing Loan Servicing
The Company acquires servicing rights, and retains servicing rights related to certain of its sales or securitizations of residential mortgages, commercial mortgages, and other consumer loans. Servicing rights are capitalized by the Company as Loan servicing rights on the Consolidated Balance Sheets. Income earned by the Company on its loan servicing rights is derived primarily from contractually specified servicing fees, late fees, net of curtailment costs, and other ancillary fees.

Residential Mortgage Activities

The following tables summarize residential mortgage servicing activities:

(Dollars in millions)Mar 31, 2025Dec 31, 2024
UPB of residential mortgage loan servicing portfolio$271,268 $273,412 
UPB of residential mortgage loans serviced for others, primarily agency conforming fixed rate
216,148 218,475 
Mortgage loans sold with recourse142 146 
Maximum recourse exposure from mortgage loans sold with recourse liability89 91 
Indemnification, recourse and repurchase reserves43 44 
As of / For the Three Months Ended March 31,
(Dollars in millions)		20252024
UPB of residential mortgage loans sold from LHFS$2,508 $1,763 
Pre-tax gains recognized on mortgage loans sold and held for sale15 15 
Servicing fees recognized from mortgage loans serviced for others154 147 
Approximate weighted average servicing fee on the outstanding balance of residential mortgage loans serviced for others
0.28 %0.28 %
Weighted average interest rate on mortgage loans serviced for others3.68 3.59 

The following table presents a roll forward of the carrying value of residential MSRs recorded at fair value:

(Dollars in millions)20252024
Residential MSRs, carrying value, January 1$3,430 $3,088 
Additions53 30 
Sales— (1)
Change in fair value due to changes in valuation inputs or assumptions(49)77 
Realization of expected net servicing cash flows, passage of time, and other(68)(60)
Residential MSRs, carrying value, March 31$3,366 $3,134 

The sensitivity of the fair value of the Company’s residential MSRs to changes in key assumptions is presented in the following table:

March 31, 2025December 31, 2024
RangeWeighted AverageRangeWeighted Average
(Dollars in millions)MinMaxMinMax
Prepayment speed6.4 %13.3 %7.4 %6.3 %11.2 %7.1 %
Effect on fair value of a 10% increase$(92)$(89)
Effect on fair value of a 20% increase(179)(172)
OAS1.5 %12.2 %4.7 %1.8 %12.5 %4.8 %
Effect on fair value of a 10% increase$(68)$(70)
Effect on fair value of a 20% increase(133)(138)
Composition of loans serviced for others:   
Fixed-rate residential mortgage loans99.7 %99.7 %
Adjustable-rate residential mortgage loans
0.3 0.3 
Total  100.0 %  100.0 %
Weighted average life  7.5 years  7.6 years

The sensitivity calculations above are hypothetical and should not be considered predictive of future performance. As indicated, changes in fair value based on adverse changes in assumptions generally cannot be extrapolated because the relationship of the change in assumption to the change in fair value may not be linear. Also, in the above table, the effect of an adverse variation in one assumption on the fair value of the MSRs is calculated without changing any other assumption; while in reality, changes in one factor may result in changes in another, which may magnify or counteract the effect of the change. See “Note 15. Fair Value Disclosures” for additional information on the valuation techniques used.
Commercial Mortgage Activities

The following table summarizes commercial mortgage servicing activities:

(Dollars in millions)Mar 31, 2025Dec 31, 2024
UPB of CRE mortgages serviced for others$27,570 $27,845 
CRE mortgages serviced for others covered by recourse provisions9,915 9,985 
Maximum recourse exposure from CRE mortgages sold with recourse liability2,915 2,940 
Recorded reserves related to recourse exposure11 11 
CRE mortgages originated during the year-to-date period90 1,467 
Commercial MSRs at fair value251 265