We utilize various financial instruments, including loan commitments, commercial letters of credit, and standby letters of credit, to support our customers’ financing needs. These instruments expose us to varying degrees of credit, liquidity, and interest rate risk that are not fully reflected on the consolidated balance sheet. The associated credit risk is evaluated and recorded as a reserve for unfunded lending commitments, which is presented separately on the consolidated balance sheet.


(In millions)	March 31, 2026		December 31, 2025

Unfunded lending commitments 1	$	29,471	$	29,286
Standby letters of credit:
Financial	669		643
Performance	311		288
Commercial letters of credit	41		27

Total unfunded commitments	$	30,492	$	30,244

We are involved in various legal proceedings or governmental inquiries, which may include litigation in court, arbitration, investigations, examinations, and other actions initiated or considered by governmental and self-regulatory agencies. These matters may relate to lending, deposit, and other customer relationships; supplier and contractual issues; employee matters; intellectual property disputes; personal injury and other tort claims; and regulatory or legal compliance issues. While many of these matters involve individual claims, we are also subject to putative class action claims and other broader claims.

Governmental and self-regulatory proceedings, investigations, examinations, and related actions may concern our banking, investment advisory, trust, securities, and other products and services; our customers’ involvement in money laundering, fraud, securities violations, and other illicit activities; or our policies and practices regarding such customer activities. They may also involve our compliance with the wide range of applicable banking, securities, and other laws and regulations. At any given time, we may be responding to subpoenas and requests for documents, data, or testimony and engaging in discussions to address or resolve these matters.

•Two civil cases—Lifescan, Inc. and Johnson & Johnson Health Care Services v. Jeffrey C. Smith, et al., filed in December 2017, and Roche Diagnostics and Roche Diabetes Care Inc. v. Jeffrey C. Smith, et al., filed in March 2019—were brought against us in the United States District Court for the District of New Jersey. In these cases, certain manufacturers and distributors of medical products allege that we are liable for purportedly fraudulent conduct by a borrower of the Bank that sought bankruptcy protection in 2017. Discovery is substantially complete as to most parties. However, final rulings on certain dispositive motions remain pending, and additional dispositive motions have not yet been filed or resolved. Both cases are currently scheduled for trial in April 2027.

Based on our current knowledge, we believe that the estimated liabilities for litigation and other legal actions and claims, as reflected in our accruals and determined in accordance with applicable accounting guidance, are adequate. We also currently believe that any liabilities in excess of the amounts accrued, if any, arising from litigation and other legal actions and claims for which a loss is estimable, would not have a significant impact on our financial condition, results of operations, or cash flows. However, given the substantial uncertainties inherent in these matters—and the potentially significant or indeterminate damages sought in some cases—an unfavorable outcome could affect our financial condition, results of operations, or cash flows in a particular reporting period.

The process of estimating and assessing potential outcomes associated with litigation, arbitration, governmental or self-regulatory examinations, investigations, or similar matters is inherently uncertain and requires significant judgment. This uncertainty is especially pronounced in the early stages of a legal matter, when legal issues and relevant facts have not yet been fully developed, analyzed, or tested through discovery, trial or hearing preparation, substantive mediation or settlement discussions, or other procedural milestones. It is also especially relevant for class actions or other multi-party claims; matters involving complex procedural or substantive issues or novel legal theories; and examinations, investigations, or other actions initiated by governmental and self-regulatory agencies, where traditional adjudicative processes may not apply.

As a result, we are often unable to determine whether the likelihood of a favorable or unfavorable outcome is remote, reasonably likely, or probable—or to estimate the amount or range of a probable or reasonably likely loss—until relatively late in the life cycle of a legal matter, and in some cases not until several years have passed. Our assessments relating to these currently inestimable claims will evolve as developments occur, and actual outcomes may significantly differ from our estimates over time.