v3.25.1
Derivative Financial Instruments
 3 Months Ended
Mar. 31, 2025
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:

March 31, 2025December 31, 2024
 Notional AmountFair ValueNotional AmountFair Value
(Dollars in millions)AssetsLiabilitiesAssetsLiabilities
Cash flow hedges:      
Interest rate contracts:      
Swaps hedging commercial loans$66,585 $— $(1)$66,585 $— $— 
Fair value hedges:   
Interest rate contracts:   
Swaps hedging long-term debt 17,993 — — 17,368 — — 
Swaps hedging AFS securities29,850 — — 30,126 — — 
Total47,843 — — 47,494 — — 
Not designated as hedges:      
Client-related and other risk management:      
Interest rate contracts:      
Swaps152,012 508 (1,337)146,194 488 (1,706)
Written options10,554 17 (40)9,623 16 (49)
Purchased options10,079 25 (1)11,321 29 (1)
Futures and forwards4,418 5 (2)4,782 1 (2)
Foreign exchange contracts:
Swaps9,732 120 (89)7,397 128 (114)
Futures and forwards20,142 210 (203)21,966 311 (270)
Other2,437 33 (31)760 5 (4)
Equity contracts:
Written options31,647 16 (1,496)28,228 12 (2,102)
Purchased options14,506 876 (27)11,956 1,366 (23)
Other1,888 28 (70)1,730 6 (41)
Commodity contracts11,048 509 (488)10,988 318 (297)
Credit contracts:
Credit default swaps917 — — 685 — — 
Total return swaps1,810 38 — 1,485 25 (13)
Risk participation agreements7,254 — (2)7,388 — (2)
Total278,444 2,385 (3,786)264,503 2,705 (4,624)
MSRs and mortgage banking:      
Interest rate contracts:      
Swaps22,267 — — 20,696 — — 
Written options1,299 26 (1)1,932 32 (6)
Purchased options8,259 19 (62)8,910 60 (46)
Interest rate lock commitments1,033 4 (3)939 2 (13)
When issued securities, forward rate agreements, forward commitments, and futures
4,909 3 (7)5,261 25 (11)
Total37,767 52 (73)37,738 119 (76)
Total derivatives not designated as hedges316,211 2,437 (3,859)302,241 2,824 (4,700)
Total derivatives$430,639 2,437 (3,860)$416,320 2,824 (4,700)
Gross amounts in the Consolidated Balance Sheets:    
Amounts subject to master netting arrangements and exchange traded derivatives
(1,191)1,191  (1,408)1,408 
Cash collateral (received) posted for amounts subject to master netting arrangements
 (190)906  (450)1,006 
Net amount $1,056 $(1,763) $966 $(2,286)
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. GAAP does not permit netting of non-cash collateral balances in the Consolidated Balance Sheets. Refer to "Note 3. Securities Financing Activities" for information about the Company's securities financing transactions subject to master netting (or similar) arrangements.

March 31, 2025
(Dollars in millions)		Gross AmountAmount OffsetNet Amount in Consolidated Balance Sheets
Held/Pledged Financial Instruments(1)
Net Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement$1,599 $(1,005)$594 $— $594 
Derivatives not subject to master netting arrangement or similar arrangement105 1 106 — 106 
Exchange traded derivatives733 (377)356 — 356 
Total derivative assets$2,437 $(1,381)$1,056 $— $1,056 
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement$(2,851)$1,720 $(1,131)$86 $(1,045)
Derivatives not subject to master netting arrangement or similar arrangement(632)— (632)— (632)
Exchange traded derivatives(377)377 — — — 
Total derivative liabilities$(3,860)$2,097 $(1,763)$86 $(1,677)
December 31, 2024
(Dollars in millions)		Gross AmountAmount OffsetNet Amount in Consolidated Balance Sheets
Held/Pledged Financial Instruments(1)
Net Amount
Derivative assets:
Derivatives subject to master netting arrangement or similar arrangement$1,599 $(1,293)$306 $— $306 
Derivatives not subject to master netting arrangement or similar arrangement78 — 78 — 78 
Exchange traded derivatives1,147 (565)582 — 582 
Total derivative assets$2,824 $(1,858)$966 $— $966 
Derivative liabilities:
Derivatives subject to master netting arrangement or similar arrangement$(3,379)$1,849 $(1,530)$94 $(1,436)
Derivatives not subject to master netting arrangement or similar arrangement(752)— (752)— (752)
Exchange traded derivatives(569)565 (4)— (4)
Total derivative liabilities$(4,700)$2,414 $(2,286)$94 $(2,192)
(1)The fair value of held/pledged financial instruments is limited to the carrying amount of the associated derivative asset or liability.

The following table presents the carrying amount of hedged items in fair value hedging relationships:

March 31, 2025December 31, 2024
Carrying Amount of the Hedged Assets and Liabilities(1)
Hedge Basis Adjustment
Carrying Amount of the Hedged Assets and Liabilities(1)
Hedge Basis Adjustment
(Dollars in millions)Items Currently DesignatedDiscontinued HedgesItems Currently DesignatedDiscontinued Hedges
AFS securities(2)
$43,426 $(110)$14 $43,621 $(503)$15 
Loans and leases249 — 4 297 — 5 
Long-term debt28,411 32 (491)29,469 (121)(533)
(1)Carrying value shown represents amortized cost.
(2)As of March 31, 2025, closed portfolios of securities hedged under the portfolio layer method have an amortized cost of $30.2 billion, of which $17.7 billion was designated as hedged. The remaining amount of amortized cost is from securities with terminated hedges where the basis adjustment is being amortized into earnings using the effective interest method over the contractual life of the security and hedges not designated under the portfolio-layer method.
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)20252024
Pre-tax gain (loss) recognized in OCI:
Commercial loans$469 $(303)
Pre-tax gain (loss) reclassified from AOCI into interest expense or interest income:
Commercial loans(93)(55)

The following table summarizes the impact on net interest income related to fair value hedges:

Three Months Ended March 31,
(Dollars in millions)20252024
Investment securities:
Amounts related to interest settlements$71 $163 
Recognized on derivatives(392)442 
Recognized on hedged items
401 (436)
Net income (expense) recognized(1)
80 169 
Loans and leases:
Recognized on hedged items
(1)(1)
Long-term debt:
Amounts related to interest settlements(22)(39)
Recognized on derivatives152 (232)
Recognized on hedged items
(195)211 
Net income (expense) recognized(65)(60)
Net income (expense) recognized, total
$14 $108 
(1)Includes $9 million of income recognized for the three months ended March 31, 2025 and $9 million for the three months ended March 31, 2024 from securities with terminated hedges that were reclassified to HTM. The income recognized was offset by the amortization of the fair value mark.
The following table presents information about the Company’s cash flow and fair value hedges:

(Dollars in millions)Mar 31, 2025Dec 31, 2024
Cash flow hedges:
Net unrecognized after-tax gain (loss) on active hedges recorded in AOCI$(305)$(722)
Net unrecognized after-tax gain (loss) on terminated hedges recorded in AOCI (to be recognized in earnings through 2029)
(127)(139)
Maximum time period over which Truist is hedging a portion of the variability in future cash flows for forecasted transactions excluding those transactions relating to the payment of variable interest on existing instruments
4 years5 years
Fair value hedges:
Unrecognized pre-tax net gain (loss) on terminated hedges(1)
$(145)$(180)
(1)Includes deferred gains that are recorded in AOCI as a result of the reclassification to HTM of previously hedged securities of $364 million at March 31, 2025 and $373 million at December 31, 2024.

Of the after-tax net loss on active and terminated cash flow hedges in OCI as of March 31, 2025, losses of $232 million after-tax are expected to be reclassified into earnings in the next 12 months.

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 Location20252024
Client-related and other risk management:
Interest rate contractsInvestment banking and trading income and other income$11 $39 
Foreign exchange contractsInvestment banking and trading income and other income(49)65 
Equity contractsInvestment banking and trading income, other income, and personnel expense53 (17)
Credit contractsInvestment banking and trading income and other income14 (24)
Commodity contractsInvestment banking and trading income3 2 
MSRs and mortgage banking:  
Interest rate contractsMortgage banking income37 (98)
Total$69 $(33)
Credit Derivative Instruments

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

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, 2025, 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% default by all obligors on the maximum value.

The Company has also entered into TRS contracts on loans and bonds. 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 14. Commitments and Contingencies.”

The Company enters into credit default swaps to hedge credit risk associated with certain loans and leases. The Company accounts for these contracts as derivatives, and accordingly, recognizes these contracts at fair value.

The following table presents additional information related to interest rate derivative risk participation agreements and total return swaps:

(Dollars in millions)Mar 31, 2025Dec 31, 2024
Risk participation agreements:
Maximum potential amount of exposure
$374 $381 
Total return swaps:
Cash received for variation margin37 25 
Cash and other collateral received for initial margin402 329