v3.26.1
Retirement and Benefit Plans
 3 Months Ended
Mar. 31, 2026
Retirement Benefits [Abstract]  
Retirement and Benefit Plans Retirement and Benefit Plans
The Bancorp acquired various retirement and employee benefit plans in connection with the acquisition of Comerica Incorporated, which was completed on February 1, 2026. These plans provide retirement, health care and life insurance benefits to eligible employees and retirees and include both qualified and non‑qualified defined benefit arrangements. The assets and obligations of the acquired defined benefit plans were remeasured as of February 1, 2026. The Bancorp recognizes the overfunded or underfunded status of the plans in other assets and accrued taxes, interest and expenses, respectively, in the Condensed Consolidated Balance Sheets. The following sections provide further information regarding the defined benefit pension and postretirement benefit obligations, plan structures and funding practices for these acquired plans. For information on the Bancorp’s previously existing plans, refer to Note 22 of the Notes to Consolidated Financial Statements included in the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2025.

Comerica defined benefit retirement plans
The Bancorp acquired both a qualified and non-qualified defined benefit retirement plan in connection with the Comerica acquisition. Plan participants primarily include individuals who were previously employed by Comerica or its subsidiaries prior to the acquisition. These plans primarily utilize a cash balance benefit structure which vests after three years of service, with additional benefits available for certain individuals who were participants in the plan prior to 2017. Benefits earned under the cash balance formula include contribution credits, which are based on eligible compensation, age and years of service, and interest credits which are based on U.S. Treasury securities. The benefit structure of the nonqualified plan is similar to the qualified plan except that the nonqualified plan considers compensation in excess of applicable IRS limitations.

Comerica postretirement benefit plan
The Bancorp also acquired a postretirement benefit plan in connection with the Comerica acquisition, which provides postretirement health care and life insurance benefits for certain former Comerica employees. This plan is frozen and has been closed to new participants since January 1, 2007 but primarily provides benefits to participants who retired prior to January 1, 2000. The Plan’s health benefits are structured as a funded Health Reimbursement Arrangement for participants covered by Medicare or individual marketplace insurance plans.

The following table summarizes the plans as of February 1, 2026:
($ in millions)Qualified PlanNon-Qualified PlanPostretirement
Benefit Plan
Fair value of plan assets$2,970 — 42 
Projected benefit obligation1,615 158 N/A
Accumulated benefit obligation1,595 154 13 
Funded status(a)
$1,355 (158)29 
(a)Based on projected benefit obligation for the Qualified and Non-Qualified Plans and accumulated benefit obligation for the Postretirement Benefit Plan.

For the period from February 1, 2026 to March 31, 2026, the Bancorp recognized service cost of $7 million and other net periodic pension benefit of $5 million related to the acquired defined benefit plans. Included within the other net periodic pension benefit was $11 million of expense related to retirement termination benefits associated with former employees of Comerica. Service cost and other net periodic pension benefit are recorded in compensation and benefits expense and other noninterest expense, respectively, in the Condensed Consolidated Statements of Income.

Weighted-Average Assumptions
The plans’ actuarial assumptions were evaluated as of February 1, 2026 and will be updated annually and as necessary thereafter. The expected long-term rate of return on plan assets is the average rate of return expected to be realized on funds invested or expected to be invested over the life of the plan. The expected long-term rate of return on plan assets is set after considering both long-term returns in the general market and long-term returns experienced by the assets in the plan. The returns on the various asset categories are blended to derive an equity and a fixed income long-term rate of return.

The following table summarizes the weighted-average plan assumptions as of February 1, 2026:
Qualified PlanNon-Qualified PlanPostretirement
Benefit Plan
Discount rate5.62 %5.57 5.40 
Rate of compensation increase4.50 4.50 N/A
Interest crediting rate
4.87-5.25
4.87-5.25
N/A
Expected long-term return on plan assets6.75 N/A2.50 
Estimated future benefit payments
The Bancorp did not make contributions to the plans during the period from February 1, 2026 to March 31, 2026, and, based on the actuarial assumptions, does not expect to make contributions to the plans for the remainder of 2026, except to the extent necessary for benefit payments made under the Non-Qualified Plan. The following table summarizes the estimated future benefit payments as of February 1, 2026:
($ in millions)Qualified PlanNon-Qualified Plan
Postretirement Benefit Plan(a)
Remainder of 2026$178 15 2 
2027151 15 2 
2028147 15 2 
2029148 15 2 
2030147 15 1 
2031 - 2035684 71 5 
(a)Estimated future benefit payments in the Postretirement Benefit Plan are presented net of estimated Medicare subsidies.

Fair Value Measurements of Plan Assets
The following table summarizes the Qualified Plan assets measured at fair value on a recurring basis as of February 1, 2026:
Fair Value Measurements Using(a)
($ in millions)Level 1Level 2Level 3Total Fair Value
Debt securities:
U.S. Treasury and federal agencies securities$700 6 — 706 
Asset-backed securities and other debt securities(b)
— 936 — 936 
Private placement securities— 41 — 41 
Total debt securities$700 983 — 1,683 
Total plan assets in the fair value hierarchy$700 983 — 1,683 
Investments measured at NAV:
Collective investment funds$1,265 
Total plan assets at fair value(c)
$2,948 
(a)For further information on fair value hierarchy levels, refer to Note 1 of the Notes to Consolidated Financial Statements included in the Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2025.
(b)Includes corporate and municipal bonds and notes.
(c)Excludes accrued interest receivable of $22.

The following is a description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy.

Debt securities
Where quoted prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities include U.S. Treasury securities. If quoted market prices are not available, then fair values are estimated using pricing models which primarily utilize quoted prices of securities with similar characteristics. Level 2 securities may include federal agencies securities, asset-backed securities and other debt securities and private placement securities.

Collective investment funds
NAV is used as a practical expedient to determine the fair value of investments in collective funds, so these investments are not classified within the fair value hierarchy. There are no unfunded commitments or redemption restrictions on the collective investment funds. The investments are redeemable daily.

There were no assets in the Non-Qualified Plan at February 1, 2026. The Postretirement Benefit Plan is invested in cash and BOLI policies. Cash is classified in Level 1 of the valuation hierarchy. The fair value of BOLI policies is based on the cash surrender values of the policies as reported by the insurance companies and is classified in Level 2 of the valuation hierarchy.

Investment Policies and Strategies
The Bancorp’s objectives for the Qualified Plan are to maintain a portfolio of assets of appropriate liquidity and diversification; to generate investment returns (net of all operating costs) that are reasonably anticipated to maintain the plan’s fully funded status or to reduce a funding deficit, after taking into account various factors, including reasonably anticipated future contributions, expense and the interest rate sensitivity of the plan’s assets relative to that of the plan’s liabilities; and to generate investment returns (net of all operating costs) that meet or exceed a customized benchmark as defined in the plan’s investment policy. The Bancorp’s target allocations for plan investments are 55 percent to 65
percent for fixed-income securities and 35 percent to 45 percent for equity securities. There were no significant concentrations of risk associated with the investments of the Qualified Plan at February 1, 2026.

Permitted asset classes of the Qualified Plan include fixed-income (U.S. Treasury and other U.S. government agency securities, corporate bonds and notes, municipal bonds, collateralized mortgage obligations and money market funds) and equities (collective investment funds). Derivative instruments are permissible for hedging and transactional efficiency, but only to the extent that the derivative use enhances the efficient execution of the Qualified Plan’s investment policy. The Qualified Plan does not directly invest in securities issued by the Bancorp and its subsidiaries.

Fifth Third Bank, National Association, (the “Trustee”), is expected to manage plan assets in a manner consistent with the Qualified Plan agreement and other regulatory, federal and state laws. The Fifth Third Bank Pension, 401(k) and Medical Plan Committee (the “Committee”) is the plan administrator. The Trustee provides to the Committee quarterly reports and is also required to keep the Committee apprised of any material changes in the Trustee’s outlook and recommended investment policy. There were no fees paid by the Plan for accounting or administrative services provided by the Trustee for the period from February 1, 2026 to March 31, 2026.