Delaware | 05-0412693 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number) |
Table of Contents | ||||
AFS | Available for Sale | |
ALLL | Allowance for Loan and Lease Losses | |
AOCI | Accumulated Other Comprehensive Income (Loss) | |
ASU | Accounting Standards Update | |
ATM | Automated Teller Machine | |
BHC | Bank Holding Company | |
bps | Basis Points | |
C&I | Commercial and Industrial | |
Capital Plan Rule | Federal Reserve’s Regulation Y Capital Plan Rule | |
CBNA | Citizens Bank, N.A. | |
CBPA | Citizens Bank of Pennsylvania | |
CCAR | Comprehensive Capital Analysis and Review | |
CCO | Chief Credit Officer | |
CET1 | Common Equity Tier 1 | |
CEO | Chief Executive Officer | |
Citizens or CFG or the Company | Citizens Financial Group, Inc. and its Subsidiaries | |
CLTV | Combined Loan-to-Value | |
CMO | Collateralized Mortgage Obligation | |
CRE | Commercial Real Estate | |
CRO | Chief Risk Officer | |
DFAST | Dodd-Frank Act Stress Test | |
Dodd-Frank Act | The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 | |
EPS | Earnings Per Share | |
ESPP | Employee Stock Purchase Program | |
ERISA | Employee Retirement Income Security Act of 1974 | |
Fannie Mae (FNMA) | Federal National Mortgage Association | |
FASB | Financial Accounting Standards Board | |
FDIC | Federal Deposit Insurance Corporation | |
FHLB | Federal Home Loan Bank | |
FICO | Fair Isaac Corporation (credit rating) | |
FRB | Federal Reserve Bank | |
FRBG | Federal Reserve Board of Governors | |
Freddie Mac (FHLMC) | Federal Home Loan Mortgage Corporation | |
FTP | Funds Transfer Pricing | |
GAAP | Accounting Principles Generally Accepted in the United States of America | |
GDP | Gross Domestic Product | |
Ginnie Mae (GNMA) | Government National Mortgage Association | |
HELOC | Home Equity Line of Credit | |
HTM | Held To Maturity | |
IPO | Initial Public Offering | |
LCR | Liquidity Coverage Ratio | |
LGD | Loss Given Default |
LIBOR | London Interbank Offered Rate | |
LIHTC | Low Income Housing Tax Credit | |
LTV | Loan-to-Value | |
MBS | Mortgage-Backed Securities | |
MD&A | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
MSR | Mortgage Servicing Right | |
NSFR | Net Stable Funding Ratio | |
OCC | Office of the Comptroller of the Currency | |
OCI | Other Comprehensive Income | |
OIS | Overnight Index Swap | |
OTC | Over the Counter | |
PD | Probability of Default | |
peers or peer banks or peer regional banks | BB&T, Comerica, Fifth Third, KeyCorp, M&T, PNC, Regions, SunTrust and U.S. Bancorp | |
RBS | The Royal Bank of Scotland Group plc or any of its subsidiaries | |
ROTCE | Return on Average Tangible Common Equity | |
RPA | Risk Participation Agreement | |
RWA | Risk-weighted Assets | |
SBO | Serviced by Others loan portfolio | |
SVaR | Stressed Value-at-Risk | |
TDR | Troubled Debt Restructuring | |
VaR | Value-at-Risk |
Page | ||
(in millions, except share data) | September 30, 2015 | December 31, 2014 | |||||
ASSETS: | |||||||
Cash and due from banks | $1,067 | $1,171 | |||||
Interest-bearing cash and due from banks | 689 | 2,105 | |||||
Interest-bearing deposits in banks | 363 | 370 | |||||
Securities available for sale, at fair value | 18,197 | 18,656 | |||||
Securities held to maturity (fair value of $5,386 and $5,193, respectively) | 5,285 | 5,148 | |||||
Other investment securities, at fair value | 50 | 33 | |||||
Other investment securities, at cost | 822 | 867 | |||||
Loans held for sale, at fair value | 369 | 256 | |||||
Other loans held for sale | 51 | 25 | |||||
Loans and leases | 97,431 | 93,410 | |||||
Less: Allowance for loan and lease losses | 1,201 | 1,195 | |||||
Net loans and leases | 96,230 | 92,215 | |||||
Derivative assets (related party balances of $105 and $1, respectively) | 838 | 629 | |||||
Premises and equipment, net | 560 | 595 | |||||
Bank-owned life insurance | 1,553 | 1,527 | |||||
Goodwill | 6,876 | 6,876 | |||||
Other assets (related party balances of $2 and $7, respectively) | 2,497 | 2,384 | |||||
TOTAL ASSETS | $135,447 | $132,857 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY: | |||||||
LIABILITIES: | |||||||
Deposits: | |||||||
Noninterest-bearing | $27,373 | $26,086 | |||||
Interest-bearing (related party balances of $5 and $5, respectively) | 74,493 | 69,621 | |||||
Total deposits | 101,866 | 95,707 | |||||
Federal funds purchased and securities sold under agreements to repurchase | 1,293 | 4,276 | |||||
Other short-term borrowed funds | 5,861 | 6,253 | |||||
Derivative liabilities (related party balances of $275 and $387, respectively) | 641 | 612 | |||||
Deferred taxes, net | 637 | 493 | |||||
Long-term borrowed funds (related party balances of $2,000 and $2,000, respectively) | 4,153 | 4,642 | |||||
Other liabilities (related party balances of $30 and $30, respectively) | 1,396 | 1,606 | |||||
TOTAL LIABILITIES | $115,847 | $113,589 | |||||
Contingencies (refer to Note 13) | |||||||
STOCKHOLDERS’ EQUITY: | |||||||
Preferred stock, $25.00 par value, authorized 100,000,000 shares: | |||||||
Series A, non-cumulative perpetual, $25.00 par value (liquidation preference $1,000), 250,000 shares authorized and issued net of issuance costs and related premium at September 30, 2015, and no shares outstanding at December 31, 2014 | $247 | $— | |||||
Common stock: | |||||||
$0.01 par value, 1,000,000,000 shares authorized, 562,941,263 shares issued and 527,636,510 shares outstanding at September 30, 2015 and 1,000,000,000 shares authorized, 560,262,638 shares issued and 545,884,519 shares outstanding at December 31, 2014 | 6 | 6 | |||||
Additional paid-in capital | 18,718 | 18,676 | |||||
Retained earnings | 1,745 | 1,294 | |||||
Treasury Stock, at cost, 35,304,753 and 14,378,119 shares at September 30, 2015 and December 31, 2014, respectively | (857 | ) | (336 | ) | |||
Accumulated other comprehensive loss | (259 | ) | (372 | ) | |||
TOTAL STOCKHOLDERS’ EQUITY | $19,600 | $19,268 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $135,447 | $132,857 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
(in millions, except share and per-share data) | 2015 | 2014 | 2015 | 2014 | ||||||||
INTEREST INCOME: | ||||||||||||
Interest and fees on loans and leases (related party balances of $17, $18, $53 and $54, respectively) | $812 | $754 | $2,381 | $2,235 | ||||||||
Interest and fees on loans held for sale, at fair value | 3 | 2 | 8 | 4 | ||||||||
Interest and fees on other loans held for sale | 3 | — | 7 | 22 | ||||||||
Investment securities | 154 | 155 | 468 | 458 | ||||||||
Interest-bearing deposits in banks | 2 | 2 | 4 | 4 | ||||||||
Total interest income | 974 | 913 | 2,868 | 2,723 | ||||||||
INTEREST EXPENSE: | ||||||||||||
Deposits | 65 | 41 | 177 | 108 | ||||||||
Deposits held for sale | — | — | — | 4 | ||||||||
Federal funds purchased and securities sold under agreements to repurchase (related party balances of $1, $3, $6 and $16, respectively) | 4 | 9 | 13 | 25 | ||||||||
Other short-term borrowed funds (related party balances of $13, $16, $38 and $60, respectively) | 17 | 21 | 51 | 70 | ||||||||
Long-term borrowed funds (related party balances of $19, $17, $59 and $42, respectively) | 32 | 22 | 95 | 55 | ||||||||
Total interest expense | 118 | 93 | 336 | 262 | ||||||||
Net interest income | 856 | 820 | 2,532 | 2,461 | ||||||||
Provision for credit losses | 76 | 77 | 211 | 247 | ||||||||
Net interest income after provision for credit losses | 780 | 743 | 2,321 | 2,214 | ||||||||
NONINTEREST INCOME: | ||||||||||||
Service charges and fees (related party balances of $0, $1, $2 and $4, respectively) | 145 | 144 | 419 | 430 | ||||||||
Card fees | 60 | 58 | 172 | 175 | ||||||||
Trust and investment services fees | 41 | 39 | 118 | 120 | ||||||||
Mortgage banking fees | 18 | 21 | 81 | 55 | ||||||||
Capital markets fees (related party balances of $2, $4, $8 and $9, respectively) | 21 | 22 | 73 | 66 | ||||||||
Foreign exchange and trade finance fees (related party balances of $5, $59, $21 and $52, respectively) | 22 | 26 | 67 | 70 | ||||||||
Bank-owned life insurance income | 14 | 13 | 40 | 36 | ||||||||
Securities gains, net | 2 | 2 | 19 | 27 | ||||||||
Net impairment losses recognized in earnings | (2 | ) | (1 | ) | (5 | ) | (7 | ) | ||||
Other income (related party balances of ($75), $5, ($125) and ($130), respectively) | 32 | 17 | 76 | 367 | ||||||||
Total noninterest income | 353 | 341 | 1,060 | 1,339 | ||||||||
NONINTEREST EXPENSE: | ||||||||||||
Salaries and employee benefits | 404 | 409 | 1,234 | 1,281 | ||||||||
Outside services (related party balances of $3, $3, $8 and $19, respectively) | 89 | 106 | 267 | 314 | ||||||||
Occupancy (related party balances of $0, $0, $1 and $0, respectively) | 75 | 77 | 245 | 245 | ||||||||
Equipment expense | 62 | 58 | 190 | 187 | ||||||||
Amortization of software | 35 | 38 | 108 | 102 | ||||||||
Other operating expense | 133 | 122 | 405 | 439 | ||||||||
Total noninterest expense | 798 | 810 | 2,449 | 2,568 | ||||||||
Income before income tax expense | 335 | 274 | 932 | 985 | ||||||||
Income tax expense | 115 | 85 | 313 | 317 | ||||||||
NET INCOME | $220 | $189 | $619 | $668 | ||||||||
Net income available to common stockholders | $213 | $189 | $612 | $668 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||
Basic | 530,985,255 | 559,998,324 | 538,279,222 | 559,998,324 | ||||||||
Diluted | 533,398,158 | 560,243,747 | 540,926,361 | 560,081,031 | ||||||||
Per common share information: | ||||||||||||
Basic earnings | $0.40 | $0.34 | $1.14 | $1.19 | ||||||||
Diluted earnings | 0.40 | 0.34 | 1.13 | 1.19 | ||||||||
Dividends declared and paid | 0.10 | 0.68 | 0.30 | 1.34 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||
Net income | $220 | $189 | $619 | $668 | |||||||||
Other comprehensive income (loss): | |||||||||||||
Net unrealized derivative instrument gains arising during the periods, net of income taxes of $30, $10, $66 and $80, respectively | 48 | 17 | 108 | 137 | |||||||||
Reclassification adjustment for net derivative (losses) gains included in net income, net of income taxes of ($3), $2, ($5) and $9, respectively | (4 | ) | 3 | (8 | ) | 16 | |||||||
Net unrealized securities available for sale gains (losses) arising during the periods, net of income taxes of $37, ($36), $25 and $73, respectively | 61 | (61 | ) | 41 | 127 | ||||||||
Other-than-temporary impairment not recognized in earnings on securities, net of income taxes of ($4), $0, ($15) and ($12), respectively | (8 | ) | (1 | ) | (26 | ) | (22 | ) | |||||
Reclassification of net securities gains to net income, net of income taxes of $0, $0, ($5) and ($7), respectively | — | (1 | ) | (9 | ) | (13 | ) | ||||||
Defined benefit pension plans: | |||||||||||||
Actuarial loss, net of income taxes of $0, ($35), $0 and ($35), respectively | — | (59 | ) | — | (59 | ) | |||||||
Net prior service credit, net of income taxes of $0, $3, $0 and $3, respectively | — | 4 | — | 4 | |||||||||
Amortization of actuarial loss, net of income taxes $0, $1, $3 and $2, respectively | 3 | 2 | 7 | 4 | |||||||||
Divestitures to RBS effective September 1, 2014, net of income taxes of $0, $13, $0 and $13, respectively | — | 19 | — | 19 | |||||||||
Total other comprehensive income (loss), net of income taxes | 100 | (77 | ) | 113 | 213 | ||||||||
Total comprehensive income | $320 | $112 | $732 | $881 |
Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings | Treasury Stock, at Cost | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||
(in millions) | Shares | Amount | Shares | Amount | |||||||||||||||||||||
Balance at January 1, 2014 | — | $— | 560 | $6 | $18,603 | $1,235 | $— | ($648 | ) | $19,196 | |||||||||||||||
Dividends to RBS | — | — | — | — | — | (85 | ) | — | — | (85 | ) | ||||||||||||||
Dividends to RBS — exchange transactions | — | — | — | — | — | (666 | ) | — | — | (666 | ) | ||||||||||||||
Share-based compensation plans | — | — | — | — | 57 | — | — | — | 57 | ||||||||||||||||
Total comprehensive income: | |||||||||||||||||||||||||
Net income | — | — | — | — | — | 668 | — | — | 668 | ||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | 213 | 213 | ||||||||||||||||
Total comprehensive income | — | — | — | — | — | 668 | — | 213 | 881 | ||||||||||||||||
Balance at September 30, 2014 | — | $— | 560 | $6 | $18,660 | $1,152 | $— | ($435 | ) | $19,383 | |||||||||||||||
Balance at January 1, 2015 | — | $— | 546 | $6 | $18,676 | $1,294 | ($336 | ) | ($372 | ) | $19,268 | ||||||||||||||
Dividends to common stockholders | — | — | — | — | — | (90 | ) | — | — | (90 | ) | ||||||||||||||
Dividends to RBS | — | — | — | — | — | (71 | ) | — | — | (71 | ) | ||||||||||||||
Dividend to preferred stockholders | — | — | — | — | — | (7 | ) | — | — | (7 | ) | ||||||||||||||
Issuance of preferred stock | — | 247 | — | — | — | — | — | — | 247 | ||||||||||||||||
Treasury stock purchased | — | — | (20 | ) | — | — | — | (500 | ) | — | (500 | ) | |||||||||||||
Share-based compensation plans | — | — | 2 | — | 35 | — | (21 | ) | — | 14 | |||||||||||||||
Employee stock purchase plan shares issued | — | — | — | — | 7 | — | — | — | 7 | ||||||||||||||||
Total comprehensive income: | |||||||||||||||||||||||||
Net income | — | — | — | — | — | 619 | — | — | 619 | ||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | 113 | 113 | ||||||||||||||||
Total comprehensive income | — | — | — | — | — | 619 | — | 113 | 732 | ||||||||||||||||
Balance at September 30, 2015 | — | $247 | 528 | $6 | $18,718 | $1,745 | ($857 | ) | ($259 | ) | $19,600 |
Nine Months Ended September 30, | ||||||||
(in millions) | 2015 | 2014 | ||||||
OPERATING ACTIVITIES | ||||||||
Net income | $619 | $668 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Provision for credit losses | 211 | 247 | ||||||
Originations of mortgage loans held for sale | (1,836 | ) | (1,131 | ) | ||||
Proceeds from sales of mortgage loans held for sale | 1,780 | 1,089 | ||||||
Purchases of commercial loans held for sale | (887 | ) | — | |||||
Proceeds from sales of commercial loans held for sale | 826 | — | ||||||
Amortization of terminated cash flow hedges (related party balances of $13 and $13, respectively) | 13 | 36 | ||||||
Depreciation, amortization and accretion | 350 | 313 | ||||||
Mortgage servicing rights valuation recovery | (6 | ) | (8 | ) | ||||
Securities impairment | 5 | 7 | ||||||
Deferred income taxes | 76 | 31 | ||||||
Share-based compensation | 22 | 29 | ||||||
Loss on disposal/impairment of premises and equipment | — | 18 | ||||||
Loss on sale of other branch assets held for sale | — | 9 | ||||||
Gain on sales of: | ||||||||
Debt securities | (19 | ) | (27 | ) | ||||
Marketable equity securities available for sale | (3 | ) | — | |||||
Premises and equipment | (9 | ) | — | |||||
Other loans held for sale | — | (11 | ) | |||||
Deposits held for sale | — | (286 | ) | |||||
Increase in other assets (related party balances of ($99) and $53, respectively) | (306 | ) | (2,033 | ) | ||||
(Decrease) increase in other liabilities (related party balances of ($112) and ($151), respectively) | (5 | ) | 2,256 | |||||
Net cash provided by operating activities | 831 | 1,207 | ||||||
INVESTING ACTIVITIES | ||||||||
Investment securities: | ||||||||
Purchases of securities available for sale | (5,418 | ) | (5,642 | ) | ||||
Proceeds from maturities and paydowns of securities available for sale | 2,660 | 2,238 | ||||||
Proceeds from sales of securities available for sale | 3,180 | 1,265 | ||||||
Purchases of securities held to maturity | (811 | ) | (1,174 | ) | ||||
Proceeds from maturities and paydowns of securities held to maturity | 610 | 216 | ||||||
Proceeds from sales of securities held to maturity | 73 | — | — | |||||
Purchases of other investment securities, at fair value | (109 | ) | (97 | ) | ||||
Proceeds from sales of other investment securities, at fair value | 92 | 90 | ||||||
Purchases of other investment securities, at cost | (33 | ) | (72 | ) | ||||
Proceeds from sales of other investment securities, at cost | 78 | 114 | ||||||
Net decrease (increase) in interest-bearing deposits in banks | 7 | (59 | ) | |||||
Net increase in loans and leases | (4,315 | ) | (4,120 | ) | ||||
Net increase in bank-owned life insurance | (26 | ) | (31 | ) | ||||
Premises and equipment: | ||||||||
Purchases | (54 | ) | (48 | ) | ||||
Proceeds from sales | 12 | 29 | ||||||
Capitalization of software | (142 | ) | (116 | ) | ||||
Net cash used in investing activities | (4,196 | ) | (7,407 | ) | ||||
FINANCING ACTIVITIES | ||||||||
Net increase in deposits | 6,159 | 1,569 | ||||||
Net (decrease) increase in federal funds purchased and securities sold under agreements to repurchase | (2,983 | ) | 393 | |||||
Net (decrease) increase in other short-term borrowed funds | (1,152 | ) | 4,462 | |||||
Proceeds from issuance of long-term borrowed funds (related party balances of $0 and $666, respectively) | 250 | 666 | ||||||
Repayments of long-term borrowed funds | (8 | ) | (7 | ) | ||||
Treasury stock purchased | (500 | ) | — | |||||
Net proceeds from issuance of preferred stock | 247 | — | ||||||
Dividends declared and paid to common stockholders | (90 | ) | — | |||||
Dividends declared and paid to RBS | (71 | ) | (751 | ) | ||||
Dividends declared and paid to preferred stockholders | (7 | ) | — | |||||
Net cash provided by financing activities | 1,845 | 6,332 | ||||||
(Decrease) increase in cash and cash equivalents | (1,520 | ) | 132 | |||||
Cash and cash equivalents at beginning of period | 3,276 | 2,757 | ||||||
Cash and cash equivalents at end of period | $1,756 | $2,889 |
September 30, 2015 | December 31, 2014 | ||||||||||||||||||||||||
(in millions) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||
Securities Available for Sale | |||||||||||||||||||||||||
U.S. Treasury | $15 | $— | $— | $15 | $15 | $— | $— | $15 | |||||||||||||||||
State and political subdivisions | 9 | — | — | 9 | 10 | — | — | 10 | |||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||
Federal agencies and U.S. government sponsored entities | 17,340 | 292 | (25 | ) | 17,607 | 17,683 | 301 | (50 | ) | 17,934 | |||||||||||||||
Other/non-agency | 587 | 3 | (41 | ) | 549 | 703 | 4 | (35 | ) | 672 | |||||||||||||||
Total mortgage-backed securities | 17,927 | 295 | (66 | ) | 18,156 | 18,386 | 305 | (85 | ) | 18,606 | |||||||||||||||
Total debt securities available for sale | 17,951 | 295 | (66 | ) | 18,180 | 18,411 | 305 | (85 | ) | 18,631 | |||||||||||||||
Marketable equity securities | 5 | — | — | 5 | 10 | 3 | — | 13 | |||||||||||||||||
Other equity securities | 12 | — | — | 12 | 12 | — | — | 12 | |||||||||||||||||
Total equity securities available for sale | 17 | — | — | 17 | 22 | 3 | — | 25 | |||||||||||||||||
Total securities available for sale | $17,968 | $295 | ($66 | ) | $18,197 | $18,433 | $308 | ($85 | ) | $18,656 | |||||||||||||||
Securities Held to Maturity | |||||||||||||||||||||||||
Mortgage-backed securities: | |||||||||||||||||||||||||
Federal agencies and U.S. government sponsored entities | $4,092 | $67 | ($4 | ) | $4,155 | $3,728 | $22 | ($31 | ) | $3,719 | |||||||||||||||
Other/non-agency | 1,193 | 38 | — | 1,231 | 1,420 | 54 | — | 1,474 | |||||||||||||||||
Total securities held to maturity | $5,285 | $105 | ($4 | ) | $5,386 | $5,148 | $76 | ($31 | ) | $5,193 | |||||||||||||||
Other Investment Securities, at Fair Value | |||||||||||||||||||||||||
Money market mutual fund | $45 | $— | $— | $45 | $28 | $— | $— | $28 | |||||||||||||||||
Venture capital and other investments | 5 | — | — | 5 | 5 | — | — | 5 | |||||||||||||||||
Total other investment securities, at fair value | $50 | $— | $— | $50 | $33 | $— | $— | $33 | |||||||||||||||||
Other Investment Securities, at Cost | |||||||||||||||||||||||||
Federal Reserve Bank stock | $468 | $— | $— | $468 | $477 | $— | $— | $477 | |||||||||||||||||
Federal Home Loan Bank stock | 354 | — | — | 354 | 390 | — | — | 390 | |||||||||||||||||
Total other investment securities, at cost | $822 | $— | $— | $822 | $867 | $— | $— | $867 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||
Other-than-temporary impairment: | |||||||||||||
Total other-than-temporary impairment losses | ($14 | ) | ($3 | ) | ($46 | ) | ($42 | ) | |||||
Portions of loss recognized in other comprehensive income (before taxes) | 12 | 2 | 41 | 35 | |||||||||
Net impairment losses recognized in earnings | ($2 | ) | ($1 | ) | ($5 | ) | ($7 | ) |
September 30, 2015 | ||||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||||
(dollars in millions) | Number of Issues | Fair Value | Gross Unrealized Losses | Number of Issues | Fair Value | Gross Unrealized Losses | Number of Issues | Fair Value | Gross Unrealized Losses | |||||||||||||||||
State and political subdivisions | 1 | $9 | $— | — | $— | $— | 1 | $9 | $— | |||||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||||||||||
Federal agencies and U.S. government sponsored entities | 35 | 2,985 | (12 | ) | 37 | 960 | (17 | ) | 72 | 3,945 | (29 | ) | ||||||||||||||
Other/non-agency | 6 | 52 | (1 | ) | 19 | 366 | (40 | ) | 25 | 418 | (41 | ) | ||||||||||||||
Total mortgage-backed securities | 41 | 3,037 | (13 | ) | 56 | 1,326 | (57 | ) | 97 | 4,363 | (70 | ) | ||||||||||||||
Total | 42 | $3,046 | ($13 | ) | 56 | $1,326 | ($57 | ) | 98 | $4,372 | ($70 | ) |
December 31, 2014 | ||||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||||
(dollars in millions) | Number of Issues | Fair Value | Gross Unrealized Losses | Number of Issues | Fair Value | Gross Unrealized Losses | Number of Issues | Fair Value | Gross Unrealized Losses | |||||||||||||||||
State and political subdivisions | — | $— | $— | 1 | $10 | $— | 1 | $10 | $— | |||||||||||||||||
Mortgage-backed securities: | ||||||||||||||||||||||||||
Federal agencies and U.S. government sponsored entities | 75 | 3,282 | (24 | ) | 52 | 1,766 | (57 | ) | 127 | 5,048 | (81 | ) | ||||||||||||||
Other/non-agency | 6 | 80 | (2 | ) | 17 | 397 | (33 | ) | 23 | 477 | (35 | ) | ||||||||||||||
Total mortgage-backed securities | 81 | 3,362 | (26 | ) | 69 | 2,163 | (90 | ) | 150 | 5,525 | (116 | ) | ||||||||||||||
Total | 81 | $3,362 | ($26 | ) | 70 | $2,173 | ($90 | ) | 151 | $5,535 | ($116 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||
Cumulative balance at beginning of period | $62 | $60 | $62 | $56 | |||||||||
Credit impairments recognized in earnings on securities not previously impaired | — | — | — | — | |||||||||
Credit impairments recognized in earnings on securities that have been previously impaired | 2 | 1 | 5 | 7 | |||||||||
Reductions due to increases in cash flow expectations on impaired securities | (1 | ) | (1 | ) | (4 | ) | (3 | ) | |||||
Cumulative balance at end of period | $63 | $60 | $63 | $60 |
Distribution of Maturities | |||||||||||||||
(in millions) | 1 Year or Less | 1-5 Years | 5-10 Years | After 10 Years | Total | ||||||||||
Amortized Cost: | |||||||||||||||
Debt securities available for sale | |||||||||||||||
U.S. Treasury | $15 | $— | $— | $— | $15 | ||||||||||
State and political subdivisions | — | — | — | 9 | 9 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Federal agencies and U.S. government sponsored entities | — | 47 | 1,972 | 15,321 | 17,340 | ||||||||||
Other/non-agency | — | 70 | 9 | 508 | 587 | ||||||||||
Total debt securities available for sale | 15 | 117 | 1,981 | 15,838 | 17,951 | ||||||||||
Debt securities held to maturity | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Federal agencies and U.S. government sponsored entities | — | — | — | 4,092 | 4,092 | ||||||||||
Other/non-agency | — | — | — | 1,193 | 1,193 | ||||||||||
Total debt securities held to maturity | — | — | — | 5,285 | 5,285 | ||||||||||
Total amortized cost of debt securities | $15 | $117 | $1,981 | $21,123 | $23,236 | ||||||||||
Fair Value: | |||||||||||||||
Debt securities available for sale | |||||||||||||||
U.S. Treasury | $15 | $— | $— | $— | $15 | ||||||||||
State and political subdivisions | — | — | — | 9 | 9 | ||||||||||
Mortgage-backed securities: | |||||||||||||||
Federal agencies and U.S. government sponsored entities | — | 50 | 2,006 | 15,551 | 17,607 | ||||||||||
Other/non-agency | — | 71 | 9 | 469 | 549 | ||||||||||
Total debt securities available for sale | 15 | 121 | 2,015 | 16,029 | 18,180 | ||||||||||
Debt securities held to maturity | |||||||||||||||
Mortgage-backed securities: | |||||||||||||||
Federal agencies and U.S. government sponsored entities | — | — | — | 4,155 | 4,155 | ||||||||||
Other/non-agency | — | — | — | 1,231 | 1,231 | ||||||||||
Total debt securities held to maturity | — | — | — | 5,386 | 5,386 | ||||||||||
Total fair value of debt securities | $15 | $121 | $2,015 | $21,415 | $23,566 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||
Taxable | $154 | $155 | $468 | $458 | |||||||||
Non-taxable | — | — | — | — | |||||||||
Total interest income from investment securities | $154 | $155 | $468 | $458 |
Three Months Ended September 30, 2015 | Nine Months Ended September 30, 2015 | ||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||
Gains on sale of debt securities | $7 | $7 | $29 | $32 | |||||||||
Losses on sale of debt securities | (7 | ) | (5 | ) | (12 | ) | (5 | ) | |||||
Debt securities gains, net | $— | $2 | $17 | $27 | |||||||||
Equity securities gains | $— | $— | $3 | $— |
September 30, 2015 | December 31, 2014 | ||||||||||||
(in millions) | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||
Pledged against repurchase agreements | $1,275 | $1,294 | $3,650 | $3,701 | |||||||||
Pledged against FHLB borrowed funds | 1,203 | 1,241 | 1,355 | 1,407 | |||||||||
Pledged against derivatives, to qualify for fiduciary powers, and to secure public and other deposits as required by law | 3,442 | 3,517 | 3,453 | 3,520 |
September 30, 2015 | December 31, 2014 | ||||||||||||||||||
(in millions) | Gross Assets (Liabilities) | Gross Assets (Liabilities) Offset | Net Amounts of Assets (Liabilities) | Gross Assets (Liabilities) | Gross Assets (Liabilities) Offset | Net Amounts of Assets (Liabilities) | |||||||||||||
Securities purchased under agreements to resell | $1,300 | ($1,300 | ) | $— | $— | $— | $— | ||||||||||||
Securities sold under agreements to repurchase | (1,800 | ) | 1,300 | (500 | ) | (2,600 | ) | — | (2,600 | ) |
Remaining Contractual Maturity of the Agreements | |||||||||||||||
(in millions) | Overnight and Continuous | Up to 30 Days | 30-90 Days | Greater Than 90 Days | Total | ||||||||||
Securities purchased under agreements to resell | |||||||||||||||
Mortgage-backed securities - Agency | $— | $500 | $300 | $500 | $1,300 | ||||||||||
Total securities purchased under agreements to resell | $— | $500 | $300 | $500 | $1,300 | ||||||||||
Securities sold under agreements to repurchase | |||||||||||||||
Mortgage-backed securities - Agency | $— | ($500 | ) | ($800 | ) | ($500 | ) | ($1,800 | ) | ||||||
Total securities sold under agreement to repurchase | $— | ($500 | ) | ($800 | ) | ($500 | ) | ($1,800 | ) |
(in millions) | September 30, 2015 | December 31, 2014 | |||||
Commercial | $32,726 | $31,431 | |||||
Commercial real estate | 8,678 | 7,809 | |||||
Leases | 3,865 | 3,986 | |||||
Total commercial | 45,269 | 43,226 | |||||
Residential mortgages | 12,792 | 11,832 | |||||
Home equity loans | 2,842 | 3,424 | |||||
Home equity lines of credit | 14,707 | 15,423 | |||||
Home equity loans serviced by others (1) | 1,054 | 1,228 | |||||
Home equity lines of credit serviced by others (1) | 441 | 550 | |||||
Automobile | 13,876 | 12,706 | |||||
Student | 3,846 | 2,256 | |||||
Credit cards | 1,628 | 1,693 | |||||
Other retail | 976 | 1,072 | |||||
Total retail | 52,162 | 50,184 | |||||
Total loans and leases (2) (3) | $97,431 | $93,410 |
Nine Months Ended September 30, 2015 | |||||||||
(in millions) | Commercial | Retail | Total | ||||||
Allowance for loan and lease losses as of January 1, 2015 | $544 | $651 | $1,195 | ||||||
Charge-offs | (32 | ) | (324 | ) | (356 | ) | |||
Recoveries | 42 | 107 | 149 | ||||||
Net (charge-offs) recoveries | 10 | (217 | ) | (207 | ) | ||||
Provision charged to income | 21 | 192 | 213 | ||||||
Allowance for loan and lease losses as of September 30, 2015 | 575 | 626 | 1,201 | ||||||
Reserve for unfunded lending commitments as of January 1, 2015 | 61 | — | 61 | ||||||
Credit for unfunded lending commitments | (2 | ) | — | (2 | ) | ||||
Reserve for unfunded lending commitments as of September 30, 2015 | 59 | — | 59 | ||||||
Total allowance for credit losses as of September 30, 2015 | $634 | $626 | $1,260 |
Nine Months Ended September 30, 2014 | |||||||||
(in millions) | Commercial | Retail | Total | ||||||
Allowance for loan and lease losses as of January 1, 2014 | $498 | $723 | $1,221 | ||||||
Charge-offs | (30 | ) | (344 | ) | (374 | ) | |||
Recoveries | 47 | 84 | 131 | ||||||
Net (charge-offs) recoveries | 17 | (260 | ) | (243 | ) | ||||
Provision charged to income | 27 | 196 | 223 | ||||||
Allowance for loan and lease losses as of September 30, 2014 | 542 | 659 | 1,201 | ||||||
Reserve for unfunded lending commitments as of January 1, 2014 | 39 | — | 39 | ||||||
Provision for unfunded lending commitments | 24 | — | 24 | ||||||
Reserve for unfunded lending commitments as of September 30, 2014 | 63 | — | 63 | ||||||
Total allowance for credit losses as of September 30, 2014 | $605 | $659 | $1,264 |
September 30, 2015 | December 31, 2014 | ||||||||||||||||||
(in millions) | Commercial | Retail | Total | Commercial | Retail | Total | |||||||||||||
Individually evaluated | $194 | $1,170 | $1,364 | $205 | $1,208 | $1,413 | |||||||||||||
Formula-based evaluation | 45,075 | 50,992 | 96,067 | 43,021 | 48,976 | 91,997 | |||||||||||||
Total | $45,269 | $52,162 | $97,431 | $43,226 | $50,184 | $93,410 |
September 30, 2015 | December 31, 2014 | ||||||||||||||||||
(in millions) | Commercial | Retail | Total | Commercial | Retail | Total | |||||||||||||
Individually evaluated | $23 | $104 | $127 | $20 | $109 | $129 | |||||||||||||
Formula-based evaluation | 611 | 522 | 1,133 | 585 | 542 | 1,127 | |||||||||||||
Allowance for credit losses | $634 | $626 | $1,260 | $605 | $651 | $1,256 |
September 30, 2015 | |||||||||||||||
Criticized | |||||||||||||||
(in millions) | Pass | Special Mention | Substandard | Doubtful | Total | ||||||||||
Commercial | $31,005 | $924 | $712 | $85 | $32,726 | ||||||||||
Commercial real estate | 8,326 | 207 | 103 | 42 | 8,678 | ||||||||||
Leases | 3,796 | 22 | 47 | — | 3,865 | ||||||||||
Total | $43,127 | $1,153 | $862 | $127 | $45,269 |