DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2026

Summary of Derivative Instruments [Abstract]

The following schedule presents derivative notional amounts and recorded fair values at June 30, 2026 and December 31, 2025:


	June 30, 2026						December 31, 2025
	Notional amount		Fair value				Notional amount		Fair value
(In millions)			Other assets		Other liabilities				Other assets		Other liabilities
Derivatives designated as accounting hedges:
Cash flow hedges:

Hedges of floating-rate assets 1	$	18,150	$	1	$	10	$	2,750	$	7	$	1

Fair value hedges:
Hedges of fixed-rate assets 1	8,252		92		—		7,653		79		—
Hedges of fixed-rate liabilities	1,500		—		—		1,000		—		—
Total derivatives designated as accounting hedges	27,902		93		10		11,403		86		1
Derivatives not designated as accounting hedges: 2
Customer interest rate derivatives	28,134		243		246		22,428		251		241
Customer commodity derivatives	2,615		113		110		853		18		17
Other interest rate derivatives	1,810		2		1		5,571		2		—
Foreign exchange derivatives 3	379		2		2		308		3		1
Purchased credit derivatives	41		—		—		64		—		—
Total derivatives not designated as accounting hedges	32,979		360		359		29,224		274		259
Total gross derivatives	$	60,881	$	453	$	369	$	40,627	$	360	$	260
Less: Offsetting derivative instruments			(79)		(79)				(51)		(51)
Less: Cash collateral pledged/received			(293)		(23)				(232)		(17)
Total net derivatives presented on balance sheet 4			$	81	$	267			$	77	$	192

1 Balances include forward-starting interest rate derivatives designated as cash flow and fair value hedges of assets that had not yet become effective as of the reporting dates. Related notional amounts were $9.5 billion and $2.7 billion, respectively, at June 30, 2026, compared with $350 million and $2.1 billion at December 31, 2025.

2 Notional amounts and fair values for derivatives that are not designated as accounting hedges include both the customer-facing derivatives the Bank executes to assist customers in managing their risks and the dealer-facing derivatives that economically offset the customer transactions to mitigate the Bank's exposure.

3 Includes both spot and forward FX trades.

4 Effective in the first quarter of 2026, we changed our accounting policy to present qualifying derivative assets and liabilities, along with the associated rights to reclaim or obligations to return cash collateral, on a net basis for all eligible arrangements rather than on a gross basis. Prior period results have been recast to conform to this presentation.

Schedule of Derivative Gains (Losses) Deferred in OCI or Recognized in Earnings

The following schedule present the gains and losses from derivative instruments designated as cash flow and fair value hedges, either deferred in accumulated other comprehensive income (“AOCI”) or recognized in earnings for the three and six months ended June 30, 2026 and 2025:


	Three Months Ended June 30, 2026				Three Months Ended June 30, 2025
(In millions)	Effective portion of derivative gain/(loss) deferred in AOCI		Amount of gain/(loss) reclassified from AOCI into income		Interest on fair value hedges		Effective portion of derivative gain/(loss) deferred in AOCI		Amount of gain/(loss) reclassified from AOCI into income		Interest on fair value hedges
Cash flow hedges: 1

Hedges of floating-rate assets	$	(31)	$	(11)	$	—	$	2	$	(18)	$	—
Hedges of floating-rate liabilities	—		—		—		—		—		—
Fair value hedges: 2
Hedges of fixed-rate assets	—		—		5		—		—		14
Hedges of fixed-rate liabilities	—		—		(2)		—		—		(2)


Total derivatives designated as accounting hedges	$	(31)	$	(11)	$	3	$	2	$	(18)	$	12


	Six Months Ended June 30, 2026				Six Months Ended June 30, 2025
(In millions)	Effective portion of derivative gain (loss) deferred in AOCI		Amount of gain (loss) reclassified from AOCI into income		Interest on fair value hedges		Effective portion of derivative gain (loss) deferred in AOCI		Amount of gain (loss) reclassified from AOCI into income		Interest on fair value hedges
Cash flow hedges: 1

Hedges of floating-rate assets	$	(60)	$	(22)	$	—	$	8	$	(38)	$	—

Hedges of floating-rate liabilities	—		—		—		—		1		—
Fair value hedges: 2
Hedges of fixed-rate assets	—		—		10		—		—		27

Hedges of fixed-rate liabilities	—		—		(4)		—		—		(5)

Total derivatives designated as accounting hedges	$	(60)	$	(22)	$	6	$	8	$	(37)	$	22

1 For the 12-month period following June 30, 2026, approximately $58 million of net losses from both active and terminated cash flow hedges will be reclassified from AOCI into interest income, compared with $45 million at June 30, 2025. At June 30, 2026, approximately $19 million of losses related to terminated cash flow hedges remained deferred in AOCI, which are expected to be fully reclassified into earnings by October 2027.

2 We recorded cumulative unamortized basis adjustments from terminated fair value hedges of debt totaling $28 million and $36 million at June 30, 2026 and 2025, respectively. Additionally, we had $2 million and $3 million of cumulative unamortized basis adjustments from terminated fair value hedges of assets at June 30, 2026 and 2025, respectively. Interest on fair value hedges presented above includes the amortization of the remaining unamortized basis adjustments.

Schedule of Gains (Losses) Recognized From Derivatives Not Designated as Accounting Hedges

The following schedule presents the amount of gains (losses) recognized in “Capital markets fees and income” under noninterest income from derivatives not designated as accounting hedges:


	Other Noninterest Income/(Expense)
(In millions)	Three Months Ended June 30, 2026		Six Months Ended June 30, 2026		Three Months Ended June 30, 2025		Six Months Ended June 30, 2025
Derivatives not designated as accounting hedges:
Customer-facing interest rate derivatives	$	11	$	20	$	11	$	18
Customer-facing commodity derivatives	1		2		—		—
Other interest rate derivatives 1	(1)		—		—		(1)
Foreign exchange derivatives	6		12		8		14
Purchased credit derivatives	—		—		(1)		(1)
Total derivatives not designated as accounting hedges	$	17	$	34	$	18	$	30

1 Includes gains and losses from mortgage derivative instruments, which were recognized in “Loan-related fees and income” within noninterest income.

Schedule of Fair Value Hedges

The following schedule presents derivatives used in fair value hedge accounting relationships, including the pre-tax gains and losses recognized on both the derivatives and the corresponding hedged items for the periods presented:


	Gains (losses) recorded in income
	Three Months Ended June 30, 2026						Three Months Ended June 30, 2025
(In millions)	Derivatives		Hedged items		Total income statement impact		Derivatives		Hedged items		Total income statement impact

Hedges of fixed-rate assets 1, 2	$	48	$	(48)	$	—	$	(35)	$	35	$	—
Hedges of fixed-rate liabilities 1, 2	(10)		10		—		4		(4)		—


	Gains (losses) recorded in income
	Six Months Ended June 30, 2026						Six Months Ended June 30, 2025
(In millions)	Derivatives		Hedged items		Total income statement impact		Derivatives		Hedged items		Total income statement impact

Hedges of fixed-rate assets 1, 2	$	80	$	(80)	$	—	$	(115)	$	115	$	—
Hedges of fixed-rate liabilities 1, 2	(18)		18		—		16		(16)		—

1 Includes hedges of benchmark interest rate risk related to fixed-rate long-term debt, AFS securities, and commercial loans. Gains and losses were recognized in interest income or interest expense, consistent with the accounting treatment of the respective hedged items.

2 Income (expense) from derivative instruments excludes interest income and interest expense associated with periodic accruals and settlements in order to align with the presentation of gains and losses on the related hedged items.

Schedule of Basis Adjustments for Hedged Items

The following schedule presents information regarding basis adjustments for hedged items in fair value hedging relationships:


	Par value of hedged items				Carrying amount of the hedged items				Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged items
(In millions)	June 30, 2026		December 31, 2025		June 30, 2026		December 31, 2025		June 30, 2026		December 31, 2025

Hedges of fixed-rate assets 1, 2	$	11,566	$	11,566	$	11,303	$	11,383	$	(263)	$	(183)
Hedges of fixed-rate liabilities 1	(1,500)		(1,000)		(1,491)		(1,009)		9		(9)

1 Carrying amounts exclude (i) issuance and purchase discounts or premiums, (ii) unamortized issuance and acquisition costs, and (iii) amounts related to terminated fair value hedging relationships.

2 Hedged items include defined portfolios of AFS securities and commercial loans, as well as specifically identified AFS securities. Related basis adjustments were recorded in the same balance-sheet line items as the corresponding hedged assets. At June 30, 2026, the amortized cost basis of assets designated under the portfolio layer method was $9.0 billion, the cumulative basis adjustment associated with these hedging relationships was $31 million, and the notional amount of the designated accounting hedges was $5.7 billion.