v3.26.1
FAIR VALUE
 6 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE FAIR VALUE
Our “Financial instruments” and “Financial instrument liabilities” on our Condensed Consolidated Statements of Financial Condition are recorded at fair value. See Notes 2 and 4 of our 2025 Form 10-K for further information about such instruments and our significant accounting policies related to fair value. The following tables present assets and liabilities measured at fair value on a recurring basis.
$ in millionsLevel 1Level 2Level 3 
Netting
adjustments (1)
Balance as of March 31, 2026
Assets at fair value on a recurring basis:
    
Trading assets:     
Municipal and provincial obligations$11 $306 $— $— $317 
Corporate obligations15 580 — — 595 
Government and agency obligations40 87 — — 127 
Agency mortgage-backed securities (“MBS”), collateralized mortgage obligations (“CMOs”) and asset-backed securities (“ABS”)— 214 — — 214 
Non-agency CMOs and ABS— 142 — — 142 
Total debt securities66 1,329 — — 1,395 
Equity securities12 6 — — 18 
Brokered certificates of deposit— 19 — — 19 
Other— — 2 — 2 
Total trading assets78 1,354 2 — 1,434 
Available-for-sale securities (2)
423 5,979 — — 6,402 
Derivative assets:
Interest rate
12 263 — (214)61 
Foreign exchange— 10 — — 10 
Total derivative assets12 273 — (214)71 
All other investments:
Government and agency obligations (3)
86 — — — 86 
Other193 2 7 — 202 
Total all other investments279 2 7 — 288 
Other assets – client-owned fractional shares
188 — — — 188 
Subtotal980 7,608 9 (214)8,383 
Other investments – private equity – measured at net asset value (“NAV”)
111 
Total assets at fair value on a recurring basis$980 $7,608 $9 $(214)$8,494 
Liabilities at fair value on a recurring basis:
Trading liabilities:
Municipal and provincial obligations$4 $— $— $— $4 
Corporate obligations— 469 — — 469 
Government and agency obligations212 — — — 212 
Total debt securities216 469 — — 685 
Equity securities39 1 — — 40 
Other liabilities
— — 1 — 1 
Total trading liabilities255 470 1 — 726 
Derivative liabilities – interest rate
9 272 — (83)198 
Other payables – repurchase liabilities related to client-owned fractional shares
188 — — — 188 
Total liabilities at fair value on a recurring basis $452 $742 $1 $(83)$1,112 
$ in millionsLevel 1Level 2Level 3 
Netting
adjustments (1)
Balance as of September 30, 2025
Assets at fair value on a recurring basis:
    
Trading assets:    
Municipal and provincial obligations
$6 $403 $— $— $409 
Corporate obligations
11 659 — — 670 
Government and agency obligations
41 108 — — 149 
Agency MBS, CMOs, and ABS— 231 — — 231 
Non-agency CMOs and ABS— 36 — — 36 
Total debt securities
58 1,437 — — 1,495 
Equity securities
17 3 — — 20 
Brokered certificates of deposit
— 19 — — 19 
Other
— — 4 — 4 
Total trading assets75 1,459 4 — 1,538 
Available-for-sale securities (2)
430 6,458 — — 6,888 
Derivative assets:
Interest rate2 304 — (239)67 
Foreign exchange— 1 — — 1 
Total derivative assets2 305 — (239)68 
All other investments:
Government and agency obligations (3)
92 — — — 92 
Other185 1 7 — 193 
Total all other investments277 1 7 — 285 
Other assets – client-owned fractional shares
171 — — — 171 
Subtotal
955 8,223 11 (239)8,950 
Other investments – private equity – measured at NAV
105 
Total assets at fair value on a recurring basis
$955 $8,223 $11 $(239)$9,055 
Liabilities at fair value on a recurring basis:
Trading liabilities:
Municipal and provincial obligations$3 $— $— $— $3 
Corporate obligations— 651 — — 651 
Government and agency obligations164 — — — 164 
Agency MBS and CMOs
— 42 — — 42 
Total debt securities167 693 — — 860 
Equity securities
31 — — — 31 
Total trading liabilities198 693 — — 891 
Derivative liabilities:
Interest rate3 306 — (123)186 
Foreign exchange
— 2 — — 2 
Other
— — 2 — 2 
Total derivative liabilities3 308 2 (123)190 
Other payables – repurchase liabilities related to client-owned fractional shares
171 — — — 171 
Total liabilities at fair value on a recurring basis
$372 $1,001 $2 $(123)$1,252 

(1)Netting adjustments represent the impact of counterparty and collateral netting on our derivative balances included on our Condensed Consolidated Statements of Financial Condition. See Note 6 for additional information.
(2)Our available-for-sale securities primarily consist of agency MBS, agency CMOs, and U.S. Treasury securities (“U.S. Treasuries”). See Note 5 for further information.
(3)These assets are primarily comprised of U.S. Treasuries purchased to meet certain deposit requirements with clearing organizations.
Level 3 recurring fair value measurements

The following tables present the changes in fair value for Level 3 assets and liabilities measured at fair value on a recurring basis. The realized and unrealized gains and losses in the tables may include changes in fair value that were attributable to both observable and unobservable inputs. In the following tables, gains/(losses) on trading and derivative instruments are reported in “Principal transactions” and gains/(losses) on other investments are reported in “Other” revenues on our Condensed Consolidated Statements of Income and Comprehensive Income.
Three months ended March 31, 2026
Level 3 instruments at fair value
Financial assetsFinancial liabilities
Trading assetsDerivative assetsAll other investmentsTrading liabilities
$ in millionsOtherOtherOtherOther
Fair value beginning of period
$4 $— $7 $— 
Total gains/(losses) included in earnings— 1 — 1 
Purchases and contributions
25 — — — 
Sales and distributions(27)(1)— — 
Transfers:
   
Into Level 3— — — — 
Out of Level 3— — — — 
Fair value end of period
$2 $— $7 $1 
Unrealized gains/(losses) for the period included in earnings for instruments held at the end of the reporting period
$— $— $— $1 

Six months ended March 31, 2026
Level 3 instruments at fair value
Financial assetsFinancial liabilities
Trading assetsDerivative assets
All other investments
Trading liabilitiesDerivative liabilities
$ in millionsOtherOther
Other
OtherOther
Fair value beginning of period
$4 $— $7 $— $(2)
Total gains/(losses) included in earnings
1 2 — 1 1 
Purchases and contributions
50 — — — — 
Sales and distributions(53)(2)— — 1 
Transfers:
Into Level 3— — — — — 
Out of Level 3— — — — — 
Fair value end of period
$2 $— $7 $1 $— 
Unrealized gains/(losses) for the period included in earnings for instruments held at the end of the reporting period
$— $— $— $1 $— 
Three months ended March 31, 2025
Level 3 instruments at fair value
Financial assets
Financial liabilities
 Trading assetsDerivative assets
All other investments
Derivative liabilities
$ in millionsOtherOther
Other
Other
Fair value beginning of period
$2 $— $7 $(2)
Total gains/(losses) included in earnings1 6 — 2 
Purchases and contributions
21 — — — 
Sales and distributions
(23)— — — 
Transfers:
Into Level 3— — — — 
Out of Level 3— — — — 
Fair value end of period
$1 $6 $7 $— 
Unrealized gains/(losses) for the period included in earnings for instruments held at the end of the reporting period
$— $8 $— $— 
Six months ended March 31, 2025
Level 3 instruments at fair value
Financial assets
Trading assetsDerivative assets
All other investments
$ in millionsOtherOther
Other
Fair value beginning of period
$3 $4 $7 
Total gains/(losses) included in earnings
1 2 — 
Purchases and contributions
39 — — 
Sales and distributions
(42)— — 
Transfers:
Into Level 3— — — 
Out of Level 3— — — 
Fair value end of period
$1 $6 $7 
Unrealized gains/(losses) for the period included in earnings for instruments held at the end of the reporting period
$— $2 $— 

As of March 31, 2026, 9% of our assets and 1% of our liabilities were measured at fair value on a recurring basis. As of September 30, 2025, 10% of our assets and 2% of our liabilities were measured at fair value on a recurring basis. As of both March 31, 2026 and September 30, 2025, Level 3 assets represented less than 1% of our assets measured at fair value on a recurring basis.

Investments in private equity measured at net asset value per share

As more fully described in Note 2 of our 2025 Form 10-K, as a practical expedient, we utilize NAV or its equivalent to determine the recorded value of a portion of our private equity investments portfolio. We utilize NAV when the fund investment does not have a readily determinable fair value and the NAV of the fund is calculated in a manner consistent with the measurement principles of investment company accounting, including measurement of the investments at fair value.

Our private equity portfolio as of March 31, 2026 primarily included investments in third-party funds, including growth equity, venture capital, and mezzanine lending fund investments. Our investments cannot be redeemed directly with the funds. Our investments are monetized through the liquidation of underlying assets of fund investments, the timing of which is uncertain.
The following table presents the recorded value and unfunded commitments related to our private equity investments portfolio.
$ in millionsRecorded valueUnfunded commitment
March 31, 2026
Private equity investments measured at NAV$111 $36 
Private equity investments not measured at NAV7 
Total private equity investments
$118 
September 30, 2025
Private equity investments measured at NAV$105 $38 
Private equity investments not measured at NAV7 
Total private equity investments$112 

Financial instruments measured at fair value on a nonrecurring basis

The following table presents assets measured at fair value on a nonrecurring basis along with the valuation techniques and significant unobservable inputs used in the valuation of the assets classified as level 3. These inputs represent those that a market participant would take into account when pricing these instruments. Weighted averages are calculated by weighting each input by the relative fair value of the related financial instrument.
$ in millionsLevel 2Level 3Total fair valueValuation technique(s)Unobservable inputRange
(weighted-average)
March 31, 2026
Bank loans:
Residential mortgage loans$4 $7 $11 
Collateral or
discounted cash flow (1)
Prepayment rate
7 yrs. - 12 yrs. (10.6 yrs.)
Corporate loans$— $155 $155 
Collateral or
 discounted cash flow (1)
Recovery rate
55% - 87% (74%)
Loans held for sale$5 $— $5 
N/A (2)
N/AN/A
September 30, 2025
Bank loans:
Residential mortgage loans$5 $7 $12 
Collateral or
discounted cash flow (1)
Prepayment rate
7 yrs. - 12 yrs. (10.5 yrs.)
Corporate loans$— $179 $179 
Collateral or
 discounted cash flow (1)
Recovery rate
24% - 96% (76%)
Loans held for sale$31 $— $31 N/AN/AN/A

(1)The valuation techniques used to estimate the fair values are based on collateral value less selling costs for the collateral-dependent loans and discounted cash flows for loans that are not collateral-dependent. Unobservable inputs used in the collateral valuation technique are not meaningful and unobservable inputs used in the discounted cash flow valuation technique are presented in the table.
(2)See the “Bank loans, net - Loans held for sale” section of Note 2 of our 2025 Form 10-K for information on the valuation techniques used in the valuation of our loans held for sale measured at fair value on a nonrecurring basis.
Financial instruments not recorded at fair value

Many, but not all, of the financial instruments we hold were recorded at fair value on the Condensed Consolidated Statements of Financial Condition. The following table presents the estimated fair value and fair value hierarchy of financial assets and liabilities that are not recorded at fair value on the Condensed Consolidated Statements of Financial Condition at March 31, 2026 and September 30, 2025. This table excludes financial instruments that are carried at amounts which approximate fair value. See Note 3 of our 2025 Form 10-K for a discussion of our financial instruments that are not recorded at fair value.
$ in millionsLevel 2Level 3Total estimated fair valueCarrying amount
March 31, 2026
Financial assets:
    
Bank loans, net
$193 $54,173 $54,366 $54,662 
Financial liabilities:
 
Bank deposits - certificates of deposit$2,320 $— $2,320 $2,320 
Senior notes payable$3,187 $— $3,187 $3,521 
September 30, 2025
Financial assets:
Bank loans, net
$386 $50,362 $50,748 $51,345 
Financial liabilities:
 
Bank deposits - certificates of deposit$1,943 $— $1,943 $1,937 
Senior notes payable$3,299 $— $3,299 $3,520