INVESTMENT SECURITIES

6 Months Ended

Jun. 30, 2026

Investment Securities

We classify our investment securities as either available-for-sale (“AFS”) or held-to-maturity (“HTM”). AFS securities, which primarily consist of debt instruments used to manage liquidity and interest rate risk and to generate interest income, are measured at fair value. Unrealized gains and losses from AFS securities, net of applicable taxes, are recognized in other comprehensive income.

HTM securities represent investments that management has both the intent and ability to hold until maturity. These securities are carried at amortized cost, which reflects the original purchase price, adjusted for the amortization or accretion of any premiums or discounts, as well as any impairment losses, including those related to credit. Gains or losses resulting from the sale of investment securities are recognized in noninterest income and are measured using the specific identification method.

The carrying values of our investment securities exclude accrued interest receivables of $66 million and $64 million at June 30, 2026 and December 31, 2025, respectively. These amounts are included in “Other assets” on the consolidated balance sheet.

Investment securities with a carrying value of $17.2 billion and $17.5 billion were pledged as collateral for potential borrowings at June 30, 2026 and December 31, 2025, respectively.

When a security is transferred from AFS to HTM, the difference between its amortized cost basis and its fair value on the transfer date is amortized as a yield adjustment through interest income. The fair value at the transfer date establishes either a premium or discount relative to the amortized cost basis of the HTM securities. The amortization of unrealized gains or losses reported in AOCI offsets the impact of amortizing the resulting premium or discount through interest income created by the transfer.

The discount associated with securities previously transferred from AFS to HTM was $1.5 billion ($1.1 billion after tax) at June 30, 2026, compared with $1.6 billion ($1.2 billion after tax) at December 31, 2025.

For additional information regarding our fair value estimation process and the accounting treatment of our investment securities, see Notes 3 and 5, respectively, of our 2025 Form 10-K.

The following schedule presents the amortized cost and estimated fair values of our AFS and HTM securities:


	June 30, 2026
(In millions)	Amortized cost		Gross unrealized gains 1		Gross unrealized losses		Estimated fair value
Available-for-sale
U.S. Treasury securities	$	2,097	$	6	$	125	$	1,978
U.S. Government agencies and corporations:
Agency securities	282		—		15		267
Agency guaranteed mortgage-backed securities	6,826		3		999		5,830
Small Business Administration loan-backed securities	301		—		13		288
Municipal securities	895		—		44		851
Other debt securities	25		—		—		25
Total available-for-sale	10,426		9		1,196		9,239
Held-to-maturity
U.S. Government agencies and corporations:
Agency securities	132		—		4		128
Agency guaranteed mortgage-backed securities	8,103		34		58		8,079
Municipal securities	242		—		9		233
Total held-to-maturity	8,477		34		71		8,440
Total investment securities	$	18,903	$	43	$	1,267	$	17,679


	December 31, 2025
(In millions)	Amortized cost		Gross unrealized gains 1		Gross unrealized losses		Estimated fair value
Available-for-sale
U.S. Treasury securities	$	1,500	$	17	$	106	$	1,411
U.S. Government agencies and corporations:
Agency securities	313		—		15		298
Agency guaranteed mortgage-backed securities	7,207		5		989		6,223
Small Business Administration loan-backed securities	355		—		14		341
Municipal securities	953		—		44		909
Other debt securities	25		—		—		25
Total available-for-sale	10,353		22		1,168		9,207
Held-to-maturity
U.S. Government agencies and corporations:
Agency securities	137		—		3		134
Agency guaranteed mortgage-backed securities	8,459		111		25		8,545
Municipal securities	271		—		10		261
Total held-to-maturity	8,867		111		38		8,940
Total investment securities	$	19,220	$	133	$	1,206	$	18,147

1 Gross unrealized gains for the respective AFS security categories without values were individually less than $1 million.

The following schedule presents gross unrealized losses for AFS securities and the estimated fair value, categorized by the length of time the securities have been in an unrealized loss position:


	June 30, 2026
	Less than 12 months				12 months or more				Total
(In millions)	Gross unrealized losses		Estimated fair value		Gross unrealized losses		Estimated fair value		Gross unrealized losses		Estimated fair value






Available-for-sale
U.S. Treasury securities	$	16	$	1,087	$	109	$	293	$	125	$	1,380
U.S. Government agencies and corporations:
Agency securities	—		4		15		253		15		257
Agency guaranteed mortgage-backed securities	3		206		996		5,400		999		5,606
Small Business Administration loan-backed securities	—		24		13		260		13		284
Municipal securities	—		81		44		718		44		799
Other	—		15		—		—		—		15








Total available-for-sale investment securities	$	19	$	1,417	$	1,177	$	6,924	$	1,196	$	8,341


	December 31, 2025
	Less than 12 months				12 months or more				Total
(In millions)	Gross unrealized losses		Estimated fair value		Gross unrealized losses		Estimated fair value		Gross unrealized losses		Estimated fair value






Available-for-sale
U.S. Treasury securities	$	—	$	99	$	106	$	296	$	106	$	395
U.S. Government agencies and corporations:
Agency securities	—		7		15		288		15		295
Agency guaranteed mortgage-backed securities	2		86		987		5,735		989		5,821
Small Business Administration loan-backed securities	—		24		14		309		14		333
Municipal securities	—		68		44		797		44		865
Other	—		15		—		—		—		15








Total available-for-sale investment securities	$	2	$	299	$	1,166	$	7,425	$	1,168	$	7,724

At June 30, 2026 and December 31, 2025, the number of AFS investment securities in an unrealized loss position totaled 1,956 and 2,037, respectively.

There were no gross realized gains or losses from sales of AFS investment securities for the three and six months ended June 30, 2026 and 2025.

The following schedule presents interest income categorized by investment security type:


	Three Months Ended June 30,
	2026						2025
(In millions)	Taxable		Nontaxable		Total		Taxable		Nontaxable		Total

Available-for-sale	$	62	$	6	$	68	$	65	$	7	$	72
Held-to-maturity	45		1		46		50		1		51
Total investment securities	$	107	$	7	$	114	$	115	$	8	$	123


	Six Months Ended June 30,
	2026						2025
(In millions)	Taxable		Nontaxable		Total		Taxable		Nontaxable		Total

Available-for-sale	$	123	$	12	$	135	$	130	$	14	$	144
Held-to-maturity	92		2		94		102		2		104
Total investment securities	$	215	$	14	$	229	$	232	$	16	$	248

Maturities

The following schedule presents the amortized cost and weighted average yields of debt securities, categorized by the remaining contractual maturity of principal payments at June 30, 2026. The schedule does not reflect the effects of interest rate resets or fair value hedges. Additionally, the remaining contractual principal maturities shown do not represent the portfolio's duration, as they exclude expected prepayments or amortization, which typically result in measured durations that are significantly shorter than contractual maturities.


	June 30, 2026
	Total debt securities				Due in one year or less				Due after one year through five years				Due after five years through ten years				Due after ten years
(Dollar amounts in millions)	Amortized cost		Average yield		Amortized cost		Average yield		Amortized cost		Average yield		Amortized cost		Average yield		Amortized cost		Average yield
Available-for-sale
U.S. Treasury securities	$	2,097	3.83	%	$	200	4.04	%	$	300	4.05	%	$	1,196	4.23	%	$	401	2.35	%
U.S. Government agencies and corporations:
Agency securities	282		3.33		—		—		56		4.09		155		3.02		71		3.41
Agency guaranteed mortgage-backed securities	6,826		2.07		7		1.71		272		2.63		1,847		1.73		4,700		2.17
Small Business Administration loan-backed securities	301		3.97		—		—		16		4.78		94		3.50		191		4.14
Municipal securities 1	895		1.99		78		3.05		339		1.80		465		1.93		13		2.51
Other debt securities	25		7.79		—		—		10		9.51		—		—		15		6.65
Total available-for-sale securities	10,426		2.52		285		3.71		993		2.96		3,757		2.65		5,391		2.28
Held-to-maturity
U.S. Government agencies and corporations:
Agency securities	132		4.16		—		—		—		—		80		3.52		52		5.15
Agency guaranteed mortgage-backed securities	8,103		1.83		—		—		36		1.77		—		—		8,067		1.83
Municipal securities 1	242		3.26		35		3.42		123		2.69		79		3.82		5		7.38
Total held-to-maturity securities	8,477		1.91		35		3.42		159		2.48		159		3.67		8,124		1.85
Total investment securities	$	18,903	2.24		$	320	3.68		$	1,152	2.90		$	3,916	2.69		$	13,515	2.03

1 The yields on tax-exempt securities are calculated on a tax-equivalent basis.

Impairment

AFS Impairment

We review our AFS securities portfolio for potential impairment on a quarterly basis, assessing each security individually. For additional information regarding our impairment assessment methodology and the related accounting policies applicable to investment securities, see Note 5 of our 2025 Form 10-K.

No impairment losses were recognized on our AFS investment securities portfolio during the first six months of 2026 or 2025. The unrealized losses primarily reflect the impact of higher interest rates subsequent to the purchase of the securities and are not attributable to credit-related factors. Accordingly, absent any future sales, we expect to recover the full principal value of these securities upon maturity. At June 30, 2026, we did not intend to sell any securities in an unrealized loss position, nor do we believe it is more likely than not that we would be required to sell such securities prior to recovering their amortized cost basis.

HTM Impairment

For HTM securities, the allowance for credit losses (“ACL”) is evaluated using the same methodology applied to loans and leases measured at amortized cost, as described in Note 6. At June 30, 2026, the ACL for HTM securities was less than $1 million. All HTM securities were assigned a credit quality rating of “Pass,” with none classified as past due.