Citizens Financial Group Inc.

10/16/2024 | Press release | Distributed by Public on 10/16/2024 04:21

3Q24 FINANCIAL SUPPLEMENT (XLSX)

Cover

Financial Supplement
Third Quarter 2024

Table of Contents

Table of Contents Page
Consolidated Financial Highlights 3
Consolidated Statements of Operations (unaudited) 5
Consolidated Balance Sheets (unaudited) 6
Loans and Deposits 7
Average Balance Sheets, Annualized Yields and Rates 8
Mortgage Banking Fees 10
Segment Financial Highlights 11
Credit-Related Information:
Nonaccrual loans and leases 15
Loans and Leases 90 Days or More Past Due and Accruing 16
Charge-offs, Recoveries and Related Ratios 17
Summary of Changes in the Components of the Allowance for Credit Losses 19
Capital and Ratios 20
Non-GAAP Financial Measures and Reconciliations 21
The information in this Financial Supplement is preliminary and based on company data available at the time of the earnings presentation. It speaks only as of the particular date or dates included in the accompanying pages. The Company does not undertake an obligation to, and disclaims any duty to, update any of the information provided. Any forward-looking statements in this Financial Supplement are subject to the forward-looking statements language contained in the Company's reports filed with the SEC pursuant to the Securities Exchange Act of 1934, which can be found on the SEC's website (www.sec.gov) or on the Company's website (www.citizensbank.com). The Company's future financial performance is subject to the risks and uncertainties described in its SEC filings.

Consolidated Financial Highligh

CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in millions, except per share data)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
SELECTED OPERATING DATA
Total revenue $1,901 $1,963 $1,959 $1,988 $2,014 ($62) (3%) ($113) (6%) $5,823 $6,236 ($413) (7%)
Noninterest expense 1,259 1,301 1,358 1,612 1,293 (42) (3) (34) (3) 3,918 3,895 23 1
Profit before provision (benefit) for credit losses 642 662 601 376 721 (20) (3) (79) (11) 1,905 2,341 (436) (19)
Provision (benefit) for credit losses 172 182 171 171 172 (10) (5) - - 525 516 9 2
NET INCOME 382 392 334 189 430 (10) (3) (48) (11) 1,108 1,419 (311) (22)
Net income, Underlying1 392 408 395 426 448 (16) (4) (56) (13) 1,195 1,539 (344) (22)
Net income available to common stockholders 344 357 304 159 400 (13) (4) (56) (14) 1,005 1,332 (327) (25)
Net income available to common stockholders, Underlying1 354 373 365 396 418 (19) (5) (64) (15) 1,092 1,452 (360) (25)
PER COMMON SHARE DATA
Basic earnings $0.77 $0.79 $0.66 $0.34 $0.85 ($0.02) (3%) ($0.08) (9%) $2.21 $2.79 ($0.58) (21%)
Diluted earnings 0.77 0.78 0.65 0.34 0.85 (0.01) (1) (0.08) (9) 2.2 2.78 (0.58) (21)
Basic earnings, Underlying1 0.79 0.82 0.79 0.85 0.89 (0.03) (4) (0.10) (11) 2.40 3.04 (0.64) (21)
Diluted earnings, Underlying1 0.79 0.82 0.79 0.85 0.89 (0.03) (4) (0.10) (11) 2.39 3.03 (0.64) (21)
Cash dividends declared and paid per common share 0.42 0.42 0.42 0.42 0.42 - - - - 1.26 1.26 - -
Book value per common share 51.25 48.03 47.43 47.87 44.75 3.22 7 6.50 15 51.25 44.75 6.50 15
Tangible book value per common share 33.54 30.61 30.19 30.91 27.73 2.93 10 5.81 21 33.54 27.73 5.81 21
Dividend payout ratio 55% 53% 64% 124% 49% 139 bps 514 bps 57% 45% 1,185 bps
Dividend payout ratio, Underlying1 53% 51% 53% 49% 47% 200 bps 600 bps 53% 41% 1,200 bps
COMMON SHARES OUTSTANDING
Average: Basic 446,561,996 454,142,489 461,358,681 466,234,324 469,481,085 (7,580,493) (2%) (22,919,089) (5%) 453,993,833 478,073,507 (24,079,674) (5%)
Diluted 449,913,467 456,561,022 463,797,964 468,159,167 471,183,719 (6,647,555) (1) (21,270,252) (5) 456,461,330 479,733,008 (23,271,678) (5)
Common shares at period-end 445,216,549 452,961,853 458,485,032 466,418,055 466,221,795 (7,745,304) (2) (21,005,246) (5) 445,216,549 466,221,795 (21,005,246) (5)
1These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."
CONSOLIDATED FINANCIAL HIGHLIGHTS, CONTINUED
(dollars in millions, except per share data)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
FINANCIAL RATIOS
Net interest margin 2.76% 2.86% 2.90% 2.90% 3.03% (10)bps (27)bps 2.84% 3.16% (32)bps
Net interest margin, FTE1 2.77 2.87 2.91 2.91 3.03 (10) (26) 2.85 3.17 (32)
Return on average common equity 6.12 6.70 5.63 2.96 7.50 (58) (138) 6.15 8.20 (205)
Return on average common equity, Underlying2 6.29 7.00 6.77 7.41 7.82 (71) (153) 6.68 8.93 (225)
Return on average tangible common equity 9.45 10.61 8.86 4.72 12.00 (116) (255) 9.63 12.93 (330)
Return on average tangible common equity, Underlying2 9.71 11.09 10.65 11.84 12.51 (138) (280) 10.46 14.09 (363)
Return on average total assets 0.70 0.72 0.61 0.33 0.78 (2) (8) 0.67 0.86 (19)
Return on average total assets, Underlying2 0.71 0.75 0.72 0.76 0.81 (4) (10) 0.73 0.93 (20)
Return on average total tangible assets 0.72 0.75 0.63 0.35 0.81 (3) (9) 0.70 0.89 (19)
Return on average total tangible assets, Underlying2 0.74 0.78 0.75 0.78 0.84 (4) (10) 0.75 0.96 (21)
Effective income tax rate 18.56 18.49 22.28 7.59 21.51 7 (295) 19.69 22.24 (255)
Effective income tax rate, Underlying2 18.75 20.33 22.84 22.25 21.69 (158) (294) 20.68 22.55 (187)
Efficiency ratio 66.23 66.27 69.33 81.13 64.21 (4) 202 67.28 62.45 483
Efficiency ratio, Underlying2 65.61 64.59 65.05 63.77 63.08 102 253 65.08 59.87 521
Noninterest income as a % of total revenue 27.95 28.16 26.41 25.16 24.44 (21) 351 27.51 23.78 373
Noninterest income as a % of total revenue, Underlying2 28.05 28.00 26.32 25.16 24.44 5 361 27.45 23.78 367
CAPITAL RATIOS - PERIOD-END (PRELIMINARY)
CET1 capital ratio 10.6% 10.7% 10.6% 10.6% 10.4%
Tier 1 capital ratio 11.9 12.0 11.8 11.8 11.5
Total capital ratio 13.9 14.0 13.8 13.7 13.4
Tier 1 leverage ratio 9.4 9.4 9.3 9.3 9.4
Tangible common equity ratio 7.0 6.5 6.5 6.7 5.9
SELECTED BALANCE SHEET DATA
Total assets $219,706 $219,938 $220,448 $221,964 $225,270 ($232) -% ($5,564) (2%) $219,706 $225,270 ($5,564) (2)%
Loans and leases:
Commercial 71,808 71,934 72,823 74,445 77,457 (126) - % (5,649) (7)% 71,808 77,457 (5,649) (7)%
Retail 69,824 69,908 70,365 71,514 72,289 (84) - % (2,465) (3)% 69,824 72,289 (2,465) (3)%
Total loans and leases 141,632 141,842 143,188 145,959 149,746 (210) - % (8,114) (5)% 141,632 149,746 (8,114) (5)%
Deposits 175,188 176,352 176,428 177,342 178,197 (1,164) (1)% (3,009) (2)% 175,188 178,197 (3,009) (2)%
Long-term borrowed funds 13,944 13,082 13,804 13,467 17,354 862 7 % (3,410) (20)% 13,944 17,354 (3,410) (20)%
Total stockholders' equity 24,932 23,869 23,761 24,342 22,878 1,063 4 % 2,054 9 % 24,932 22,878 2,054 9 %
Loan-to-deposit ratio (period-end balances) 80.85% 80.43% 81.16% 82.30% 84.03% 42 bps (318)bps 80.85% 84.03% (318)bps
Loan-to-deposit ratio (average balances) 81.59 82.38 82.24 83.54 85.46 (79)bps (387)bps 82.07 87.95 (588)bps
Full-time equivalent colleagues (period-end) 17,329 17,510 17,354 17,570 18,214 (181) (1)% (885) (5)% 17,329 18,214 (885) (5)%
1 Net interest margin is presented on a fully taxable-equivalent ("FTE") basis using the federal statutory tax rate of 21%. The FTE impact is predominantly attributable to commercial loans for the periods presented.
2These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."

Consolidated Statements of Oper

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
INTEREST INCOME $ % $ % $ %
Interest and fees on loans and leases $1,976 $2,011 $2,051 $2,144 $2,166 ($35) (2%) ($190) (9%) $6,038 $6,345 ($307) (5%)
Interest and fees on loans held for sale 18 13 14 18 20 5 38 (2) (10) 45 55 (10) (18)
Interest and fees on other loans held for sale 1 4 6 4 8 (3) (75) (7) (88) 11 25 (14) (56)
Investment securities 423 417 399 339 290 6 1 133 46 1,239 823 416 51
Interest-bearing deposits in banks 121 130 140 171 111 (9) (7) 10 9 391 280 111 40
Total interest income 2,539 2,575 2,610 2,676 2,595 (36) (1) (56) (2) 7,724 7,528 196 3
INTEREST EXPENSE
Deposits 990 965 987 974 898 25 3 92 10 2,942 2,171 771 36
Short-term borrowed funds 3 4 7 7 8 (1) (25) (5) (63) 14 36 (22) (61)
Long-term borrowed funds 177 196 174 207 167 (19) (10) 10 6 547 568 (21) (4)
Total interest expense 1,170 1,165 1,168 1,188 1,073 5 - 97 9 3,503 2,775 728 26
Net interest income 1,369 1,410 1,442 1,488 1,522 (41) (3) (153) (10) 4,221 4,753 (532) (11)
NONINTEREST INCOME
Service charges and fees 109 106 96 104 105 3 3 4 4 311 306 5 2
Capital markets fees 94 134 118 87 67 (40) (30) 27 40 346 232 114 49
Card fees 93 92 86 70 74 1 1 19 26 271 226 45 20
Wealth fees1 76 75 68 68 63 1 1 13 21 219 191 28 15
Mortgage banking fees 46 54 49 57 69 (8) (15) (23) (33) 149 185 (36) (19)
Foreign exchange and derivative products 36 39 36 43 48 (3) (8) (12) (25) 111 140 (29) (21)
Letter of credit and loan fees 45 43 42 42 43 2 5 2 5 130 126 4 3
Securities gains, net 9 - 5 9 5 9 100 4 80 14 19 (5) (26)
Other income 24 10 17 20 18 14 140 6 33 51 58 (7) (12)
Total noninterest income 532 553 517 500 492 (21) (4) 40 8 1,602 1,483 119 8
TOTAL REVENUE 1,901 1,963 1,959 1,988 2,014 (62) (3) (113) (6) 5,823 6,236 (413) (7)
Provision (benefit) for credit losses 172 182 171 171 172 (10) (5) - - 525 516 9 2
NONINTEREST EXPENSE
Salaries and employee benefits 647 645 691 667 659 2 - (12) (2) 1,983 1,932 51 3
Equipment and software 194 190 192 215 191 4 2 3 2 576 541 35 6
Outside services 146 165 158 174 160 (19) (12) (14) (9) 469 513 (44) (9)
Occupancy 108 113 114 125 107 (5) (4) 1 1 335 367 (32) (9)
Other operating expense 164 188 203 431 176 (24) (13) (12) (7) 555 542 13 2
Total noninterest expense 1,259 1,301 1,358 1,612 1,293 (42) (3) (34) (3) 3,918 3,895 23 1
Income before income tax expense 470 480 430 205 549 (10) (2) (79) (14) 1,380 1,825 (445) (24)
Income tax expense 88 88 96 16 119 - - (31) (26) 272 406 (134) (33)
NET INCOME $382 $392 $334 $189 $430 ($10) (3%) ($48) (11%) $1,108 $1,419 ($311) (22%)
Net income, Underlying2 $392 $408 $395 $426 $448 ($16) (4%) ($56) (13%) $1,195 $1,539 ($344) (22%)
Net income available to common stockholders $344 $357 $304 $159 $400 ($13) (4%) ($56) (14%) $1,005 $1,332 ($327) (25%)
Net income available to common stockholders, Underlying2 $354 $373 $365 $396 $418 ($19) (5%) ($64) (15%) $1,092 $1,452 ($360) (25%)
1 Effective for the second quarter of 2024, Trust and investment services fees was renamed to Wealth fees to better reflect the broad range of wealth-related management fees and services provided to our customers.
2 These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."

Consolidated Balance Sheets

CONSOLIDATED BALANCE SHEETS (unaudited)
(dollars in millions, except par value)
PERIOD-END BALANCES AS OF SEPTEMBER 30, 2024 CHANGE
Sept 30, 2024 June 30, 2024 Mar 31, 2024 Dec 31, 2023 Sept 30, 2023 June 30, 2024 Sept 30, 2023
ASSETS $ % $ %
Cash and due from banks $979 $1,191 $1,098 $1,794 $1,395 ($212) (18%) ($416) (30%)
Interest-bearing cash and due from banks 9,936 10,580 10,501 9,834 14,005 (644) (6) (4,069) (29)
Interest-bearing deposits in banks 648 559 392 405 324 89 16 324 100
Debt securities available for sale, at fair value 32,835 31,938 31,187 29,777 25,069 897 3 7,766 31
Debt securities held to maturity 8,738 8,895 9,054 9,184 9,320 (157) (2) (582) (6)
Loans held for sale, at fair value 614 591 505 676 749 23 4 (135) (18)
Other loans held for sale 49 92 50 103 99 (43) (47) (50) (51)
Loans and leases 141,632 141,842 143,188 145,959 149,746 (210) - (8,114) (5)
Less: Allowance for loan and lease losses (2,079) (2,125) (2,086) (2,098) (2,080) 46 (2) 1 -
Net loans and leases 139,553 139,717 141,102 143,861 147,666 (164) - (8,113) (5)
Derivative assets 586 367 469 440 522 219 60 64 12
Premises and equipment 862 863 872 895 878 (1) - (16) (2)
Bank-owned life insurance 3,346 3,325 3,311 3,291 3,275 21 1 71 2
Goodwill 8,187 8,187 8,188 8,188 8,188 - - (1) -
Other intangible assets 137 139 148 157 167 (2) (1) (30) (18)
Other assets 13,236 13,494 13,571 13,359 13,613 (258) (2) (377) (3)
TOTAL ASSETS $219,706 $219,938 $220,448 $221,964 $225,270 ($232) -% ($5,564) (2%)
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Noninterest-bearing $35,978 $36,927 $36,593 $37,107 $38,561 ($949) (3%) ($2,583) (7%)
Interest-bearing 139,210 139,425 139,835 140,235 139,636 (215) - (426) -
Total deposits 175,188 176,352 176,428 177,342 178,197 (1,164) (1) (3,009) (2)
Short-term borrowed funds 15 2 9 505 232 13 NM (217) (94)
Derivative liabilities 1,012 1,547 1,705 1,562 2,109 (535) (35) (1,097) (52)
Long-term borrowed funds:
FHLB advances 553 553 2,036 3,786 7,036 - - (6,483) (92)
Senior debt 7,766 6,512 6,414 5,170 5,258 1,254 19 2,508 48
Subordinated debt and other debt 5,625 6,017 5,354 4,511 5,060 (392) (7) 565 11
Total long-term borrowed funds 13,944 13,082 13,804 13,467 17,354 862 7 (3,410) (20)
Other liabilities 4,615 5,086 4,741 4,746 4,500 (471) (9) 115 3
TOTAL LIABILITIES 194,774 196,069 196,687 197,622 202,392 (1,295) (1) (7,618) (4)
STOCKHOLDERS' EQUITY
Preferred stock:
$25.00 par value, 100,000,000 shares authorized for each of the periods presented 2,112 2,112 2,014 2,014 2,014 - - 98 5
Common stock:
$0.01 par value, 1,000,000,000 shares authorized for each of the periods presented 6 6 6 6 6 - - - -
Additional paid-in capital 22,327 22,299 22,272 22,250 22,231 28 - 96 -
Retained earnings 10,233 10,079 9,923 9,816 9,856 154 2 377 4
Treasury stock, at cost (6,820) (6,492) (6,290) (5,986) (5,986) (328) (5) (834) (14)
Accumulated other comprehensive income (loss) (2,926) (4,135) (4,164) (3,758) (5,243) 1,209 29 2,317 44
TOTAL STOCKHOLDERS' EQUITY 24,932 23,869 23,761 24,342 22,878 1,063 4 2,054 9
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $219,706 $219,938 $220,448 $221,964 $225,270 ($232) -% ($5,564) (2%)
Memo: Total tangible common equity $14,930 $13,866 $13,844 $14,417 $12,930 $1,064 8% $2,000 15%

Loans and Deposits

LOANS AND DEPOSITS
(dollars in millions)
PERIOD-END BALANCES AS OF SEPTEMBER 30, 2024 CHANGE
Sept 30, 2024 June 30, 2024 Mar 31, 2024 Dec 31, 2023 Sept 30, 2023 June 30, 2024 Sept 30, 2023
$ % $ %
LOANS AND LEASES
Commercial and industrial1 $43,825 $43,623 $43,951 $44,974 $47,971 $202 -% ($4,146) (9%)
Commercial real estate 27,983 28,311 28,872 29,471 29,486 (328) (1) (1,503) (5)
Leases - - - - - - - - -
Total commercial 71,808 71,934 72,823 74,445 77,457 (126) - (5,649) (7)
Residential mortgages 32,379 31,890 31,512 31,332 30,983 489 2 1,396 5
Home equity 15,992 15,534 15,113 15,040 14,729 458 3 1,263 9
Automobile 5,540 6,383 7,277 8,258 9,290 (843) (13) (3,750) (40)
Education 11,118 11,265 11,646 11,834 12,134 (147) (1) (1,016) (8)
Other retail 4,795 4,836 4,817 5,050 5,153 (41) (1) (358) (7)
Total retail 69,824 69,908 70,365 71,514 72,289 (84) - (2,465) (3)
Total loans and leases $141,632 $141,842 $143,188 $145,959 $149,746 ($210) - ($8,114) (5)
Loans held for sale, at fair value 614 591 505 676 749 23 4 (135) (18)
Other loans held for sale 49 92 50 103 99 (43) (47) (50) (51)
Loans and leases and loans held for sale $142,295 $142,525 $143,743 $146,738 $150,594 ($230) -% ($8,299) (6%)
DEPOSITS
Demand $35,978 $36,927 $36,593 $37,107 $38,561 ($949) (3%) ($2,583) (7%)
Money market 54,654 52,599 52,182 53,812 53,517 2,055 4 1,137 2
Checking with interest 33,680 34,421 34,487 31,876 33,355 (741) (2) 325 1
Savings 26,489 27,240 27,912 27,983 29,139 (751) (3) (2,650) (9)
Term 24,387 25,165 25,254 26,564 23,625 (778) (3) 762 3
Total deposits $175,188 $176,352 $176,428 $177,342 $178,197 ($1,164) (1%) ($3,009) (2%)
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.

Average Balance Sheets Annualiz

AVERAGE BALANCE SHEETS, ANNUALIZED YIELDS AND RATES
(dollars in millions)
QUARTERLY TRENDS 3Q24 Change
3Q24 2Q24 3Q23 2Q24 3Q23
Average Balances Interest Rate Average Balances Interest Rate Average Balances Interest Rate Average Balances Interest Rate Average Balances Interest Rate
INTEREST-EARNING ASSETS
Interest-bearing cash and due from banks and deposits in banks $8,896 $121 5.30% $9,650 $130 5.35% $8,005 $111 5.42% ($754) ($9) (5)bps $891 $10 (12)bps
Taxable investment securities 45,083 423 3.75 44,691 417 3.73 39,271 290 2.95 392 6 2 5,812 133 80
Non-taxable investment securities 1 - 2.60 1 - 2.60 2 - 2.68 - - - (1) - (8)
Total investment securities 45,084 423 3.75 44,692 417 3.73 39,273 290 2.95 392 6 2 5,811 133 80
Commercial and industrial1 44,071 556 4.95 44,381 604 5.38 48,908 762 6.10 (310) (48) (43) (4,837) (206) (115)
Commercial real estate 28,209 452 6.26 28,574 456 6.32 29,353 467 6.23 (365) (4) (6) (1,144) (15) 3
Leases - - - - - - - - - - - - - - -
Total commercial 72,280 1,008 5.46 72,955 1,060 5.75 78,261 1,229 6.15 (675) (52) (29) (5,981) (221) (69)
Residential mortgages 32,117 301 3.75 31,633 290 3.67 30,838 267 3.46 484 11 8 1,279 34 29
Home equity 15,733 317 8.02 15,343 305 7.99 14,589 286 7.77 390 12 3 1,144 31 25
Automobile 5,942 64 4.28 6,807 72 4.28 9,849 103 4.16 (865) (8) - (3,907) (39) 12
Education 11,155 153 5.45 11,447 154 5.40 12,147 156 5.11 (292) (1) 5 (992) (3) 34
Other retail 4,776 133 11.04 4,882 130 10.71 5,107 125 9.67 (106) 3 33 (331) 8 137
Total retail 69,723 968 5.53 70,112 951 5.45 72,530 937 5.14 (389) 17 8 (2,807) 31 39
Total loans and leases 142,003 1,976 5.50 143,067 2,011 5.60 150,791 2,166 5.66 (1,064) (35) (10) (8,788) (190) (16)
Loans held for sale, at fair value 1,108 18 6.31 896 13 6.19 1,204 20 6.72 212 5 12 (96) (2) (41)
Other loans held for sale 73 1 5.46 160 4 9.34 321 8 9.01 (87) (3) (388) (248) (7) (355)
Total interest-earning assets 197,164 2,539 5.09 198,465 2,575 5.17 199,594 2,595 5.13 (1,301) (36) (8) (2,430) (56) (4)
Noninterest-earning assets 21,414 20,757 20,568 657 846
TOTAL ASSETS $218,578 $219,222 $220,162 ($644) ($1,584)
INTEREST-BEARING LIABILITIES
Checking with interest $33,090 $131 1.58% $33,659 $128 1.54% $33,545 $126 1.49% ($569) $3 4 ($455) $5 9
Money market 53,152 444 3.32 51,570 431 3.36 52,057 415 3.17 1,582 13 (4) 1,095 29 15
Savings 26,868 128 1.89 27,560 120 1.75 29,516 123 1.65 (692) 8 14 (2,648) 5 24
Term 24,705 287 4.65 24,676 286 4.66 21,604 234 4.29 29 1 (1) 3,101 53 36
Total interest-bearing deposits 137,815 990 2.86 137,465 965 2.82 136,722 898 2.60 350 25 4 1,093 92 26
Short-term borrowed funds 150 3 6.06 325 4 5.62 506 8 6.21 (175) (1) 44 (356) (5) (15)
FHLB advances 477 6 5.38 2,375 34 5.55 4,023 56 5.54 (1,898) (28) (17) (3,546) (50) (16)
Senior debt 7,462 93 5.01 6,684 80 4.81 5,259 56 4.33 778 13 20 2,203 37 68
Subordinated debt and other debt 5,751 78 5.43 6,033 82 5.43 3,920 55 5.43 (282) (4) - 1,831 23 -
Total long-term borrowed funds 13,690 177 5.20 15,092 196 5.18 13,202 167 5.02 (1,402) (19) 2 488 10 18
Total borrowed funds 13,840 180 5.21 15,417 200 5.18 13,708 175 5.07 (1,577) (20) 3 132 5 14
Total interest-bearing liabilities 151,655 1,170 3.07 152,882 1,165 3.06 150,430 1,073 2.83 (1,227) 5 1 1,225 97 24
Demand deposits 36,236 36,205 39,728 31 (3,492)
Other noninterest-bearing liabilities 6,194 6,652 6,813 (458) (619)
TOTAL LIABILITIES 194,085 195,739 196,971 (1,654) (2,886)
STOCKHOLDERS' EQUITY 24,493 23,483 23,191 1,010 1,302
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $218,578 $219,222 $220,162 ($644) ($1,584)
INTEREST RATE SPREAD 2.02% 2.11% 2.30% (9) (28)
NET INTEREST MARGIN AND NET INTEREST INCOME $1,369 2.76% $1,410 2.86% $1,522 3.03% ($41) (10) ($153) (27)
NET INTEREST MARGIN AND NET INTEREST INCOME, FTE2 $1,373 2.77% $1,415 2.87% $1,526 3.03% ($42) (10) ($153) (26)
Memo: Total deposits (interest-bearing and demand) $174,051 $990 2.26% $173,670 $965 2.24% $176,450 $898 2.02% $381 $25 2 bps ($2,399) $92 24 bps
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.
2Net interest income and net interest margin is presented on a fully taxable-equivalent ("FTE") basis using the federal statutory tax rate of 21%. The FTE impact is predominantly attributable to commercial loans for the periods presented.

Average Balance Sheets Annua(1)

AVERAGE BALANCE SHEETS, ANNUALIZED YIELDS AND RATES
(dollars in millions)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024 Change
2024 2023 2023
Average Balances Interest Rate Average Balances Interest Rate Average Balances Interest Rate
INTEREST-EARNING ASSETS
Interest-bearing cash and due from banks and deposits in banks $9,602 $391 5.35% $7,232 $280 5.10% $2,370 $111 25 bps
Taxable investment securities 44,561 1,239 3.71 38,742 823 2.83 5,819 416 88
Non-taxable investment securities 1 - 2.60 2 - 2.68 (1) - (8)
Total investment securities 44,562 1,239 3.71 38,744 823 2.83 5,818 416 88
Commercial and industrial1 44,342 1,795 5.32 51,136 2,286 5.90 (6,794) (491) (58)
Commercial real estate 28,681 1,376 6.30 29,122 1,328 6.01 (441) 48 29
Leases - - - - - - - - -
Total commercial 73,023 3,171 5.71 80,258 3,614 5.94 (7,235) (443) (23)
Residential mortgages 31,713 874 3.68 30,496 776 3.39 1,217 98 29
Home equity 15,387 920 7.99 14,336 790 7.37 1,051 130 62
Automobile 6,832 218 4.27 10,920 335 4.11 (4,088) (117) 16
Education 11,472 463 5.39 12,455 465 5.00 (983) (2) 39
Other retail 4,866 392 10.76 5,184 365 9.41 (318) 27 135
Total retail 70,270 2,867 5.45 73,391 2,731 4.97 (3,121) 136 48
Total loans and leases 143,293 6,038 5.58 153,649 6,345 5.48 (10,356) (307) 10
Loans held for sale, at fair value 952 45 6.29 1,199 55 6.10 (247) (10) 19
Other loans held for sale 152 11 9.39 380 25 8.57 (228) (14) 82
Total interest-earning assets 198,561 7,724 5.15 201,204 7,528 4.96 (2,643) 196 19
Noninterest earning assets 20,959 20,535 424
TOTAL ASSETS $219,520 $221,739 ($2,219)
INTEREST-BEARING LIABILITIES
Checking with interest $33,017 $368 1.49% $34,693 $333 1.28% ($1,676) $35 21
Money market 52,552 1,320 3.35 50,562 1,050 2.78 1,990 270 57
Savings 27,389 369 1.80 29,539 310 1.40 (2,150) 59 40
Term 25,274 885 4.68 17,240 478 3.70 8,034 407 98
Total interest-bearing deposits 138,232 2,942 2.84 132,034 2,171 2.20 6,198 771 64
Short-term borrowed funds 324 14 5.64 831 36 5.71 (507) (22) (7)
FHLB advances 1,704 72 5.56 7,997 300 4.96 (6,293) (228) 60
Senior debt 6,755 243 4.80 5,375 174 4.33 1,380 69 47
Subordinated debt and other debt 5,688 232 5.44 2,537 94 4.91 3,151 138 53
Total long-term borrowed funds 14,147 547 5.15 15,909 568 4.74 (1,762) (21) 41
Total borrowed funds 14,471 561 5.16 16,740 604 4.79 (2,269) (43) 37
Total interest-bearing liabilities 152,703 3,503 3.06 148,774 2,775 2.49 3,929 728 57
Demand deposits 36,374 42,657 (6,283)
Other noninterest-bearing liabilities 6,544 6,573 (29)
TOTAL LIABILITIES 195,621 198,004 (2,383)
STOCKHOLDERS' EQUITY 23,899 23,735 164
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $219,520 $221,739 ($2,219)
INTEREST RATE SPREAD 2.09% 2.47% (38)
NET INTEREST MARGIN AND NET INTEREST INCOME $4,221 2.84% $4,753 3.16% ($532) (32)
NET INTEREST MARGIN AND NET INTEREST INCOME, FTE2 $4,234 2.85% $4,766 3.17% ($532) (32)
Memo: Total deposits (interest-bearing and demand) $174,606 $2,942 2.25% $ 174,691 $2,171 1.66% ($85) $771 59 bps
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.
2Net interest income and net interest margin is presented on a fully taxable-equivalent ("FTE") basis using the federal statutory tax rate of 21%. The FTE impact is predominantly attributable to commercial loans for the periods presented.

Mortgage Banking Fees

MORTGAGE BANKING FEES SUMMARY
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
MORTGAGE BANKING FEES
Production revenue $15 $14 $15 $11 $19 $1 7% ($4) (21%) $44 $60 ($16) (27%)
Mortgage servicing revenue 33 35 33 37 35 (2) (6) (2) (6) 101 106 (5) (5)
MSR valuation changes, net of hedge impact (2) 5 1 9 15 (7) NM (17) NM 4 19 (15) (79)
Total mortgage banking fees $46 $54 $49 $57 $69 ($8) (15%) ($23) (33%) $149 $185 ($36) (19%)
Pull-through adjusted lock volume $1,996 $1,930 $1,404 $1,412 $2,397 $66 3% ($401) (17%) $5,330 $7,345 ($2,015) (27%)
Production revenue as a percentage of Pull-through adjusted locks 0.76 % 0.74 % 1.05 % 0.78 % 0.79 % 3 bps (3)bps 0.83 % 0.82 % 1 bps
Gain on sale as a percentage of Pull-through adjusted locks 0.87 % 0.79 % 1.05 % 0.82 % 0.79 % 9 % bps 8 % bps
Gain on sale of secondary originations 0.81 % 0.81 % 1.14 % 0.72 % 0.67 % - % bps 14 % bps 0.89 % 0.82 % 7 % bps
RESIDENTIAL REAL ESTATE ORIGINATIONS
Retail $1,749 $1,584 $1,045 $958 $1,146 $165 10% $603 53% $4,378 $3,417 $961 28%
Third Party 1,504 1,323 892 1,214 2,285 181 14 (781) (34) 3,719 5,968 (2,249) (38)
Total $3,253 $2,907 $1,937 $2,172 $3,431 $346 12% ($178) (5%) $8,097 $9,385 ($1,288) (14%)
Originated for sale $2,148 $1,872 $1,296 $1,595 $2,815 $276 15% ($667) (24%) $5,316 $7,340 ($2,024) (28%)
Originated for investment 1,105 1,035 641 577 616 70 7 489 79 2,781 2,045 736 36
Total $3,253 $2,907 $1,937 $2,172 $3,431 $346 12% ($178) (5%) $8,097 $9,385 ($1,288) (14%)
MORTGAGE SERVICING INFORMATION (UPB)
Loans serviced for others $96,120 $96,439 $96,952 $97,420 $97,603 ($319) -% ($1,483) (2%) $96,120 $97,603 ($1,483) (2%)
Owned loans serviced 32,655 32,118 31,659 31,640 31,436 537 2 1,219 4 32,655 31,436 1,219 4
Total $128,775 $128,557 $128,611 $129,060 $129,039 $218 -% ($264) -% $128,775 $129,039 ($264) -%
MSR at fair value $1,501 $1,568 $1,564 $1,552 $1,620 ($67) (4%) ($119) (7%) $1,501 $1,620 ($119) (7%)

Segment Financial Highlights

SEGMENT FINANCIAL HIGHLIGHTS - CONSUMER BANKING
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
CONSUMER BANKING 3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
Net interest income $1,156 $1,120 $1,093 $1,086 $1,067 $36 3% $89 8% $3,369 $3,101 $268 9%
Noninterest income 285 277 258 265 278 8 3 7 3 820 802 18 2
Total revenue 1,441 1,397 1,351 1,351 1,345 44 3 96 7 4,189 3,903 286 7
Noninterest expense 916 915 903 905 905 1 - 11 1 2,734 2,637 97 4
Profit (loss) before credit losses 525 482 448 446 440 43 9 85 19 1,455 1,266 189 15
Net charge-offs 84 84 81 82 67 - - 17 25 249 198 51 26
Income (loss) before income tax expense (benefit) 441 398 367 364 373 43 11 68 18 1,206 1,068 138 13
Income tax expense (benefit) 114 102 95 95 97 12 12 17 18 311 278 33 12
Net income (loss) $327 $296 $272 $269 $276 $31 10% $51 18% $895 $790 $105 13%
AVERAGE BALANCES
Total assets $75,392 $74,295 $73,833 $73,334 $72,964 $1,097 1% $2,428 3% $74,510 $72,477 $2,033 3%
Total loans and leases1 69,021 67,960 67,448 66,906 66,641 1,061 2 2,380 4 68,146 66,171 1,975 3
Deposits 121,899 120,478 120,019 118,474 117,979 1,421 1 3,920 3 120,803 116,477 4,326 4
Interest-earning assets 69,608 68,552 68,050 67,524 67,273 1,056 2 2,335 3 68,740 66,823 1,917 3
KEY METRICS
Net interest margin 6.60% 6.57% 6.46% 6.40% 6.28% 3 bps 32 bps 6.54% 6.20% 34 bps
Efficiency ratio 63.53 65.49 66.87 67.08 67.18 (196)bps (365)bps 65.26 67.54 (228)bps
Loan-to-deposit ratio (period-end balances) 56.34 55.73 55.25 55.52 55.81 61 bps 53 bps 56.34 55.81 53 bps
Loan-to-deposit ratio (average balances) 56.05 55.97 55.80 55.88 55.71 8 bps 34 bps 55.94 56.13 (19)bps
Return on average total tangible assets 1.74 1.61 1.49 1.47 1.51 13 bps 23 bps 1.62 1.47 15 bps
1 Includes loans held for sale.
SEGMENT FINANCIAL HIGHLIGHTS - COMMERCIAL BANKING
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
COMMERCIAL BANKING 3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
Net interest income $478 $494 $514 $551 $560 ($16) (3%) ($82) (15%) $1,486 $1,741 ($255) (15%)
Noninterest income 207 242 227 196 180 (35) (14) 27 15 676 588 88 15
Total revenue 685 736 741 747 740 (51) (7) (55) (7) 2,162 2,329 (167) (7)
Noninterest expense 300 311 317 324 325 (11) (4) (25) (8) 928 971 (43) (4)
Profit (loss) before credit losses 385 425 424 423 415 (40) (9) (30) (7) 1,234 1,358 (124) (9)
Net charge-offs 91 90 81 65 67 1 1 24 36 262 185 77 42
Income (loss) before income tax expense (benefit) 294 335 343 358 348 (41) (12) (54) (16) 972 1,173 (201) (17)
Income tax expense (benefit) 63 76 84 89 88 (13) (17) (25) (28) 223 289 (66) (23)
Net income (loss) $231 $259 $259 $269 $260 ($28) (11%) ($29) (11%) $749 $884 ($135) (15%)
AVERAGE BALANCES
Total assets $68,092 $68,958 $70,100 $72,758 $74,997 ($866) (1%) ($6,905) (9%) $69,046 $77,130 ($8,084) (10%)
Total loans and leases1 64,974 65,997 67,187 69,899 71,898 (1,023) (2) (6,924) (10) 66,048 73,961 (7,913) (11)
Deposits 44,190 44,203 45,912 46,962 47,221 (13) - (3,031) (6) 44,766 47,221 (2,455) (5)
Interest-earning assets 65,550 66,447 67,536 70,267 72,275 (897) (1) (6,725) (9) 66,507 74,350 (7,843) (11)
KEY METRICS
Net interest margin 2.90% 2.99% 3.07% 3.11% 3.07% (9)bps (17)bps 2.98% 3.13% (15)bps
Efficiency ratio 43.84 42.28 42.80 43.44 43.93 156 bps (9)bps 42.95 41.67 128 bps
Loan-to-deposit ratio (period-end balances) 140.42 141.41 143.98 146.09 145.77 (99)bps (535)bps 140.42 145.77 (535)bps
Loan-to-deposit ratio (average balances) 145.93 148.15 145.05 147.64 150.96 (222)bps (503)bps 146.36 154.96 (860)bps
Return on average total tangible assets 1.37 1.52 1.50 1.48 1.39 (15)bps (2)bps 1.47 1.55 (8)bps
1 Includes loans held for sale.
SEGMENT FINANCIAL HIGHLIGHTS - NON-CORE
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
NON-CORE 3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
Net interest income ($28) ($31) ($37) ($45) ($41) $3 10 % $13 32 % ($96) ($84) ($12) (14)%
Noninterest income - - - - - - - % - - - - - -
Total revenue (28) (31) (37) (45) (41) 3 10 % 13 32 (96) (84) (12) (14)
Noninterest expense 23 26 25 28 30 (3) (12)% (7) (23) 74 95 (21) (22)
Profit (loss) before credit losses (51) (57) (62) (73) (71) 6 11 % 20 28 (170) (179) 9 5
Net charge-offs 17 10 19 24 20 7 70 % (3) (15) 46 54 (8) (15)
Income (loss) before income tax expense (benefit) (68) (67) (81) (97) (91) (1) (1)% 23 25 (216) (233) 17 7
Income tax expense (benefit) (17) (17) (21) (25) (24) - - % 7 29 (55) (61) 6 10
Net income (loss) ($51) ($50) ($60) ($72) ($67) ($1) (2)% $16 24 % ($161) ($172) $11 6 %
AVERAGE BALANCES
Total assets $8,389 $9,418 $10,554 $11,776 $13,113 ($1,029) (11%) ($4,724) (36%) $9,450 $14,409 ($4,959) (34%)
Total loans and leases1 8,352 9,376 10,507 11,701 13,010 (1,024) (11) (4,658) (36) 9,408 14,332 (4,924) (34)
Interest-earning assets 8,352 9,376 10,507 11,726 13,010 (1,024) (11) (4,658) (36) 9,408 14,332 (4,924) (34)
KEY METRICS
Net interest margin (1.30%) (1.36%) (1.41%) (1.54%) (1.24%) 6 bps (6)bps (1.36%) (0.78%) (58)bps
Efficiency ratio NM NM NM NM NM NM NM
Return on average total tangible assets (2.40) (2.14) (2.30) (2.42) (2.03) (26)bps (37)bps (2.28) (1.60) (68)bps
1 Includes loans held for sale.
SEGMENT FINANCIAL HIGHLIGHTS - OTHER
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
OTHER1 3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$ % $ % $ %
Net interest income ($237) ($173) ($128) ($104) ($64) ($64) (37)% ($173) NM ($538) ($5) ($533) NM
Noninterest income 40 34 32 39 34 6 18 6 18 106 93 13 14
Total revenue (197) (139) (96) (65) (30) (58) (42) (167) NM (432) 88 (520) NM
Noninterest expense 20 49 113 355 33 (29) (59) (13) (39) 182 192 (10) (5)
Profit (loss) before provision (benefit) for credit losses (217) (188) (209) (420) (63) (29) (15) (154) (244) (614) (104) (510) NM
Provision (benefit) for credit losses (20) (2) (10) - 18 (18) NM (38) NM (32) 79 (111) NM
Income (loss) before income tax expense (benefit) (197) (186) (199) (420) (81) (11) (6) (116) (143) (582) (183) (399) (218)
Income tax expense (benefit) (72) (73) (62) (143) (42) 1 1 (30) (71) (207) (100) (107) (107)
Net income (loss) ($125) ($113) ($137) ($277) ($39) ($12) (11%) ($86) (221%) ($375) ($83) ($292) NM
AVERAGE BALANCES
Total assets $66,705 $66,551 $66,283 $65,785 $59,088 $154 -% $7,617 13% $66,514 $57,723 $8,791 15%
Total loans and leases2 837 789 754 729 766 48 6 71 9 794 763 31 4
Deposits 7,962 8,989 10,173 11,692 11,250 (1,027) (11) (3,288) (29) 9,037 10,993 (1,956) (18)
Interest-earning assets 53,654 54,089 53,976 53,604 47,035 (435) (1) 6,619 14 53,906 45,698 8,208 18
1 Includes assets, liabilities, capital, revenues, provision for credit losses, expenses and income tax expense not attributed to our Consumer Banking, Commercial Banking, or Non-Core segments as well as treasury and community development.
2 Includes loans held for sale.

Nonaccrual loans and leases

CREDIT-RELATED INFORMATION
(dollars in millions)
AS OF SEPTEMBER 30, 2024 CHANGE
Sept 30, 2024 June 30, 2024 Mar 31, 2024 Dec 31, 2023 Sept 30, 2023 June 30, 2024 Sept 30, 2023
$/bps/% % $/bps/% %
NONACCRUAL LOANS AND LEASES
Commercial and industrial1 $219 $261 $294 $297 $245 ($42) (16%) ($26) (11%)
Commercial real estate 852 678 597 477 470 174 26 382 81 %
Leases - - - - - - - - -
Total commercial 1,071 939 891 774 715 132 14 356 50
Residential mortgages2 169 153 174 177 190 16 10 (21) (11)
Home equity 281 279 288 285 268 2 1 13 5
Automobile 46 44 47 61 62 2 5 (16) (26)
Education 59 52 29 28 23 7 13 36 157
Other retail 61 60 40 39 38 1 2 23 61
Total retail 616 588 578 590 581 28 5 35 6
Nonaccrual loans and leases 1,687 1,527 1,469 1,364 1,296 160 10 391 30
Repossessed assets 14 13 14 14 15 1 8 (1) (7)
Nonaccrual loans and leases and repossessed assets $1,701 $1,540 $1,483 $1,378 $1,311 $161 10% $390 30%
NONACCRUAL LOANS AND LEASES BY PRODUCT3
Commercial $1,071 $939 $891 $774 $715 $132 14% $356 50%
Retail 630 601 592 604 596 29 5 34 6
Total nonaccrual loans and leases $1,701 $1,540 $1,483 $1,378 $1,311 $161 10% $390 30%
ASSET QUALITY RATIOS
Allowance for loan and lease losses to loans and leases 1.47% 1.50% 1.46% 1.44% 1.39% (3)bps 8 bps
Allowance for credit losses to loans and leases 1.61 1.63 1.61 1.59 1.55 (2) bps 6 bps
Allowance for loan and lease losses to nonaccrual loans and leases 123 139 142 154 160 (16%) (37%)
Allowance for credit losses to nonaccrual loans and leases 136 151 157 170 179 (15%) (43%)
Nonaccrual loans and leases to loans and leases 1.19 1.08 1.02 0.93 0.87 11 bps 32 bps
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.
2Loans fully or partially guaranteed by the FHA, VA and USDA are classified as accruing.
3Nonaccrual loans and leases by product includes repossessed assets.

Loans and Leases 90 Days or Mor

CREDIT-RELATED INFORMATION, CONTINUED
(dollars in millions)
AS OF SEPTEMBER 30, 2024 CHANGE
Sept 30, 2024 June 30, 2024 Mar 31, 2024 Dec 31, 2023 Sept 30, 2023 June 30, 2024 Sept 30, 2023
$/bps % $/bps %
LOANS AND LEASES 90 DAYS OR MORE PAST DUE AND ACCRUING
Commercial and industrial1 $5 $7 $23 $6 $4 ($2) (29%) $1 25%
Commercial real estate 15 36 39 40 3 (21) (58) 12 NM
Leases - - - - - - - - -
Total commercial 20 43 62 46 7 (23) (53) 13 186
Residential mortgages2 146 182 209 256 217 (36) (20) (71) (33)
Home equity - - - - - - - - -
Automobile - - - - - - - - -
Education 2 2 2 2 3 - - (1) (33)
Other retail 1 1 27 29 21 - - (20) (95)
Total retail 149 185 238 287 241 (36) (19) (92) (38)
Total loans and leases $169 $228 $300 $333 $248 ($59) (26%) ($79) (32%)
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.
2 90+ days past due and accruing includes $145 million, $168 million, $202 million, $243 million and $216 million of loans fully or partially guaranteed by the FHA, VA, and USDA for September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023 and September 30, 2023, respectively.

Charge-offs Recoveries and Rela

CREDIT-RELATED INFORMATION, CONTINUED
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$ % $ % $ %
CHARGE-OFFS, RECOVERIES AND RELATED RATIOS
GROSS CHARGE-OFFS
Commercial and industrial1 $57 $14 $14 $24 $25 $43 NM $32 128% $85 $97 ($12) (12%)
Commercial real estate 49 86 88 49 49 (37) (43) - - 223 115 108 94 %
Leases - - - - - - - - - - - - -
Total commercial 106 100 102 73 74 6 6 32 43 308 212 96 45
Residential mortgages 1 1 2 3 1 - - - - 4 3 1 33
Home equity 4 4 4 4 3 - - 1 33 12 8 4 50
Automobile 25 19 28 31 28 6 32 (3) (11) 72 82 (10) (12)
Education 30 31 32 35 27 (1) (3) 3 11 93 76 17 22
Other retail 65 68 63 60 58 (3) (4) 7 12 196 170 26 15
Total retail 125 123 129 133 117 2 2 8 7 377 339 38 11
Total gross charge-offs $231 $223 $231 $206 $191 $8 4% $40 21% $685 $551 $134 24%
GROSS RECOVERIES
Commercial and industrial1 $3 $4 $17 $3 $3 ($1) (25%) $- -% $24 $12 $12 100%
Commercial real estate 5 - - 1 1 5 100 4 NM 5 2 3 150
Leases - - - - - - - - - - - - -
Total commercial 8 4 17 4 4 4 100 4 100 29 14 15 107
Residential mortgages 1 1 1 1 2 - - (1) (50) 3 3 - -
Home equity 5 7 6 5 6 (2) (29) (1) (17) 18 17 1 6
Automobile 12 15 14 14 13 (3) (20) (1) (8) 41 44 (3) (7)
Education 6 5 5 5 5 1 20 1 20 16 14 2 14
Other retail 7 7 7 6 8 - - (1) (13) 21 21 - -
Total retail 31 35 33 31 34 (4) (11) (3) (9) 99 99 - -
Total gross recoveries $39 $39 $50 $35 $38 $- -% $1 3% $128 $113 $15 13%
NET CHARGE-OFFS (RECOVERIES)
Commercial and industrial1 $54 $10 ($3) $21 $22 $44 NM $32 145% $61 $85 ($24) (28%)
Commercial real estate 44 86 88 48 48 (42) (49) (4) (8) 218 113 105 93 %
Leases - - - - - - - - - - - - -
Total commercial 98 96 85 69 70 2 2 28 40 279 198 81 41
Residential mortgages - - 1 2 (1) - - 1 100 1 - 1 100
Home equity (1) (3) (2) (1) (3) 2 67 2 67 (6) (9) 3 33
Automobile 13 4 14 17 15 9 225 (2) (13) 31 38 (7) (18)
Education 24 26 27 30 22 (2) (8) 2 9 77 62 15 24
Other retail 58 61 56 54 50 (3) (5) 8 16 175 149 26 17
Total retail 94 88 96 102 83 6 7 11 13 278 240 38 16
Total net charge-offs $192 $184 $181 $171 $153 $8 4% $39 25% $557 $438 $119 27%
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.
CREDIT-RELATED INFORMATION, CONTINUED
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
ANNUALIZED NET CHARGE-OFF (RECOVERY) RATES
Commercial and industrial1 0.49% 0.09% (0.03%) 0.18% 0.18% 40 bps 31 bps 0.18% 0.22% (4) bps
Commercial real estate 0.62 1.20 1.22 0.66 0.65 (58) (3) 1.02 % 0.52 % 50
Leases - - - - - - - - % - % -
Total commercial 0.54 0.53 0.47 0.36 0.35 1 19 0.51 % 0.33 % 18
Residential mortgages - - 0.01 0.02 (0.02) - 2 - % - % -
Home equity (0.03) (0.07) (0.06) (0.04) (0.08) 4 5 (0.05)% (0.08)% 3
Automobile 0.81 0.27 0.73 0.77 0.60 54 21 0.60 % 0.47 % 13
Education 0.85 0.93 0.92 1.00 0.72 (8) 13 0.90 % 0.66 % 24
Other retail 4.93 4.98 4.56 4.13 3.95 (5) 98 4.82 % 3.87 % 95
Total retail 0.54 0.51 0.54 0.56 0.46 3 8 0.53 % 0.44 % 9
Total loans and leases 0.54% 0.52% 0.50% 0.46% 0.40% 2 bps 14 bps 0.52% 0.38% 14 bps
Memo: Average loans
Commercial and industrial1 $44,071 $44,381 $44,577 $46,618 $48,908 ($310) (1%) ($4,837) (10%) $44,342 $51,136 ($6,794) (13%)
Commercial real estate 28,209 28,574 29,265 29,460 29,353 (365) (1) (1,144) (4) 28,681 29,122 (441) (2)
Leases - - - - - - - - - - - - -
Total commercial 72,280 72,955 73,842 76,078 78,261 (675) (1) (5,981) (8) 73,023 80,258 (7,235) (9)
Residential mortgages 32,117 31,633 31,384 31,146 30,838 484 2 1,279 4 31,713 30,496 1,217 4
Home equity 15,733 15,343 15,080 14,889 14,589 390 3 1,144 8 15,387 14,336 1,051 7
Automobile 5,942 6,807 7,758 8,752 9,849 (865) (13) (3,907) (40) 6,832 10,920 (4,088) (37)
Education 11,155 11,447 11,816 11,971 12,147 (292) (3) (992) (8) 11,472 12,455 (983) (8)
Other retail 4,776 4,882 4,942 5,133 5,107 (106) (2) (331) (6) 4,866 5,184 (318) (6)
Total retail 69,723 70,112 70,980 71,891 72,530 (389) (1) (2,807) (4) 70,270 73,391 (3,121) (4)
Total loans and leases $142,003 $143,067 $144,822 $147,969 $150,791 ($1,064) (1%) ($8,788) (6%) $143,293 $153,649 ($10,356) (7%)
1Effective for the first quarter of 2024, the Company's lease portfolio is included in Commercial and industrial. Prior period results have been revised to conform to the new presentation.

Summary of Changes in the Compo

CREDIT-RELATED INFORMATION, CONTINUED
(dollars in millions)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$ % $ % $ %
SUMMARY OF CHANGES IN THE COMPONENTS OF THE ALLOWANCE FOR CREDIT LOSSES
Allowance for loan and lease losses - beginning $ 2,125 $ 2,086 $ 2,098 $ 2,080 $ 2,044 $ 39 2 % $ 81 4 % $ 2,098 $ 1,983 $ 115 6 %
Cumulative effect of change in accounting principle:
Commercial - - - - - - - % - - % - - - - %
Retail - - - - - - - % - - % - - - - %
Total cumulative effect of change in accounting principle - - - - - - - % - - % - - - - %
Allowance for loan and lease losses - beginning $2,125 $2,086 $2,098 $2,080 $2,044 $39 2% $81 4% $2,098 $1,983 $115 6%
Allowance on PCD loans and leases at acquisition:
Commercial - - - - - - - - - - - - -
Retail - - - - - - - - - - - - -
Total Allowance on PCD loans and leases at acquisition - - - - - - - - - - - - -
Charge-offs:
Commercial 106 100 102 73 74 6 6 32 43 308 212 96 45
Retail 125 123 129 133 117 2 2 8 7 377 339 38 11
Total charge-offs 231 223 231 206 191 8 4 40 21 685 551 134 24
Recoveries:
Commercial 8 4 17 4 4 4 100 4 100 29 14 15 107
Retail 31 35 33 31 34 (4) (11) (3) (9) 99 99 - -
Total recoveries 39 39 50 35 38 - - 1 3 128 113 15 13
Net charge-offs 192 184 181 171 153 8 4 39 25 557 438 119 27
Provision (benefit) for loan and lease losses:
Commercial 3 144 69 86 146 (141) (98) (143) (98) 216 371 (155) (42)
Retail 143 79 100 103 43 64 81 100 233 322 164 158 96
Total provision (benefit) for loan and lease losses 146 223 169 189 189 (77) (35) (43) (23) 538 535 3 1
Allowance for loan and lease losses - ending $2,079 $2,125 $2,086 $2,098 $2,080 ($46) (2%) ($1) -% $2,079 $2,080 ($1) -%
Allowance for unfunded lending commitments - beginning $181 $222 $220 $238 $255 ($41) (18%) ($74) (29%) $220 $257 ($37) (14%)
Cumulative effect of change in accounting principle - - - - - - - - - - - - -
Allowance on PCD unfunded lending commitments at acquisition - - - - - - - - - - - - -
Provision (benefit) for unfunded lending commitments 26 (41) 2 (18) (17) 67 NM 43 NM (13) (19) 6 32
Allowance for unfunded lending commitments - ending $207 $181 $222 $220 $238 $26 14% ($31) (13%) $207 $238 ($31) (13%)
Total allowance for credit losses - ending $2,286 $2,306 $2,308 $2,318 $2,318 ($20) (1%) ($32) (1%) $2,286 $2,318 ($32) (1%)
Memo: Total allowance for credit losses by product
Commercial $1,351 $1,429 $1,425 $1,425 $1,425 ($78) (5%) ($74) (5%) $1,351 $1,425 ($74) (5%)
Retail 935 877 883 893 893 58 7 42 5 935 893 42 5
Total allowance for credit losses $2,286 $2,306 $2,308 $2,318 $2,318 ($20) (1%) ($32) (1%) $2,286 $2,318 ($32) (1%)

Capital and Ratios

CAPITAL AND RATIOS
(dollars in millions)
AS OF FOR THE NINE MONTHS ENDED SEPTEMBER 30,
SEPTEMBER 30, 2024 CHANGE 2024 Change
Sept 30, 2024 June 30, 2024 Mar 31, 2024 Dec 31, 2023 Sept 30, 2023 June 30, 2024 Sept 30, 2023 2024 2023 2023
$ % $ % $ %
CAPITAL RATIOS AND COMPONENTS (PRELIMINARY)
CET1 capital $17,941 $18,086 $18,090 $18,358 $18,360 ($145) (1%) $ (419) (2%)
Tier 1 capital 20,053 20,198 20,104 20,372 20,374 (145) (1) (321) (2)
Total capital 23,352 23,551 23,466 23,608 23,682 (199) (1) (330) (1)
Risk-weighted assets 168,552 168,393 170,125 172,601 176,407 159 - (7,855) (4)
Adjusted average assets1 213,274 214,574 216,001 219,591 215,877 (1,300) (1) (2,603) (1)
CET1 capital ratio 10.6% 10.7% 10.6% 10.6% 10.4%
Tier 1 capital ratio 11.9 % 12.0 % 11.8 % 11.8 % 11.5 %
Total capital ratio 13.9 % 14.0 % 13.8 % 13.7 % 13.4 %
Tier 1 leverage ratio 9.4 % 9.4 % 9.3 % 9.3 % 9.4 %
TANGIBLE COMMON EQUITY (PERIOD-END)
Common stockholders' equity $22,819 $21,757 $21,747 $22,329 $20,864 $1,062 5% $1,955 9% $22,819 $20,864 $1,955 9%
Less: Goodwill 8,187 8,187 8,188 8,188 8,188 - - (1) - 8,187 8,188 (1) -
Less: Other intangible assets 137 139 148 157 167 (2) (1) (30) (18) 137 167 (30) (18)
Add: Deferred tax liabilities2 435 435 433 433 421 - - 14 3 435 421 14 3
Total tangible common equity $14,930 $13,866 $13,844 $14,417 $12,930 $1,064 8% $2,000 15% $14,930 $12,930 $2,000 15%
TANGIBLE COMMON EQUITY (AVERAGE)
Common stockholders' equity $22,380 $21,427 $21,700 $21,209 $21,177 $953 4% $1,203 6% $21,838 $21,721 $117 1%
Less: Goodwill 8,187 8,188 8,188 8,188 8,188 (1) - (1) - 8,187 8,182 5 -
Less: Other intangible assets 140 144 153 163 173 (4) (3) (33) (19) 146 182 (36) (20)
Add: Deferred tax liabilities2 435 432 433 421 422 3 1 13 3 433 422 11 3
Total tangible common equity $14,488 $13,527 $13,792 $13,279 $13,238 $961 7% $1,250 9% $13,938 $13,779 $159 1%
INTANGIBLE ASSETS (PERIOD-END)
Goodwill $8,187 $8,187 $8,188 $8,188 $8,188 $- -% ($1) -% $8,187 $8,188 ($1) -%
Other intangible assets 137 139 148 157 167 (2) (1) (30) (18) 137 167 (30) (18)
Total intangible assets $8,324 $8,326 $8,336 $8,345 $8,355 ($2) -% ($31) -% $8,324 $8,355 ($31) -%
1Adjusted average assets include quarterly average assets, less deductions for disallowed goodwill and other intangible assets, net of deferred taxes, and the accumulated other comprehensive income impact related to the adoption of post-retirement benefit plan guidance under GAAP.
2Deferred tax liabilities relate to tax-deductible goodwill and other intangible assets.

Key Performance Metrics Non-GAA

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
(dollars in millions, except per share data)
Non-GAAP Financial Measures This document contains non-GAAP financial measures denoted as Underlying. Underlying results for any given reporting period exclude certain items that may occur in that period which management does not consider indicative of the Company's on-going financial performance. We believe these non-GAAP financial measures provide useful information to investors because they are used by our management to evaluate our operating performance and make day-to-day operating decisions. In addition, we believe our Underlying results in any given reporting period reflect our on-going financial performance in that period and, accordingly, are useful to consider in addition to our GAAP financial results. The following tables present reconciliations of our non-GAAP measures to the most directly comparable GAAP financial measures. Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to similar measures used by such companies. We caution investors not to place undue reliance on such non-GAAP financial measures, but to consider them with the most directly comparable GAAP measures. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our results reported under GAAP.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)
(in millions, except share, per-share and ratio data)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$ % $ % $ %
Noninterest income, Underlying:
Noninterest income (GAAP) A $532 $553 $517 $500 $492 ($21) (4%) $40 8% $1,602 $1,483 $119 8%
Less: Notable items (2) 4 3 - - (6) (150) (2) (100) 5 - 5 100
Noninterest income, Underlying (non-GAAP) B $534 $549 $514 $500 $492 ($15) (3%) $42 9% $1,597 $1,483 $114 8%
Total revenue, Underlying:
Total revenue (GAAP) C $1,901 $1,963 $1,959 $1,988 $2,014 ($62) (3%) ($113) (6%) $5,823 $6,236 ($413) (7%)
Less: Notable items (2) 4 3 - - (6) (150) (2) (100) 5 - 5 100
Total revenue, Underlying (non-GAAP) D $1,903 $1,959 $- $1,956 $1,988 $2,014 ($56) (3%) ($111) (6%) $5,818 $6,236 ($418) (7%)
Noninterest expense, Underlying:
Noninterest expense (GAAP) E $1,259 $1,301 $1,358 $1,612 $1,293 ($42) (3%) ($34) (3%) $3,918 $3,895 $23 1%
Less: Notable items 11 36 85 345 22 (25) (69) (11) (50) 132 161 (29) (18)
Noninterest expense, Underlying (non-GAAP) F $1,248 $1,265 $1,273 $1,267 $1,271 ($17) (1%) ($23) (2%) $3,786 $3,734 $52 1%
Pre-provision profit:
Total revenue (GAAP) C $1,901 $1,963 $1,959 $1,988 $2,014 ($62) (3%) ($113) (6%) $5,823 $6,236 ($413) (7%)
Less: Noninterest expense (GAAP) E 1,259 1,301 1,358 1,612 1,293 (42) (3) (34) (3) 3,918 3,895 23 1
Pre-provision profit (non-GAAP) $642 $662 $601 $376 $721 ($20) (3%) ($79) (11%) $1,905 $2,341 ($436) (19%)
Pre-provision profit, Underlying:
Total revenue, Underlying (non-GAAP) D $1,903 $1,959 $1,956 $1,988 $2,014 ($56) (3%) ($111) (6%) $5,818 $6,236 ($418) (7%)
Less: Noninterest expense, Underlying (non-GAAP) F 1,248 1,265 1,273 1,267 1,271 (17) (1) (23) (2) 3,786 3,734 52 1
Pre-provision profit, Underlying (non-GAAP) $655 $694 $683 $721 $743 ($39) (6%) ($88) (12%) $2,032 $2,502 ($470) (19%)
Provision (benefit) for credit losses, Underlying:
Provision (benefit) for credit losses (GAAP) $172 $182 $171 $171 $172 ($10) (5%) $- -% $525 $516 $9 2%
Less: Notable items - - - - - - - - - - - - -
Provision (benefit) for credit losses, Underlying (non-GAAP) $172 $182 $171 $171 $172 ($10) (5%) $- -% $525 $516 $9 2 %
Income before income tax expense, Underlying:
Income before income tax expense (GAAP) G $470 $480 $430 $205 $549 ($10) (2%) ($79) (14%) $1,380 $1,825 ($445) (24%)
Less: Income (expense) before income tax expense (benefit) related to notable items (13) (32) (82) (345) (22) 19 59 9 41 (127) (161) 34 21
Income before income tax expense, Underlying (non-GAAP) H $483 $512 $512 $550 $571 ($29) (6%) ($88) (15%) $1,507 $1,986 ($479) (24%)
Income tax expense, Underlying:
Income tax expense (GAAP) I $88 $88 $96 $16 $119 $- -% ($31) (26%) $272 $406 ($134) (33%)
Less: Income tax expense (benefit) related to notable items (3) (16) (21) (108) (4) 13 81 1 25 (40) (41) 1 2
Income tax expense, Underlying (non-GAAP) J $91 $104 $117 $124 $123 ($13) - (13%) ($32) (26%) $312 $447 ($135) (30%)
Net income, Underlying:
Net income (GAAP) K $382 $392 $334 $189 $430 ($10) (3%) ($48) (11%) $1,108 $1,419 ($311) (22%)
Add: Notable items, net of income tax benefit 10 16 61 237 18 (6) (38) (8) (44) 87 120 (33) (28)
Net income, Underlying (non-GAAP) L $392 $408 $395 $426 $448 ($16) (4%) ($56) (13%) $1,195 $1,539 ($344) (22%)
Net income available to common stockholders, Underlying:
Net income available to common stockholders (GAAP) M $344 $357 $304 $159 $400 ($13) (4%) ($56) (14%) $1,005 $1,332 ($327) (25%)
Add: Notable items, net of income tax benefit 10 16 61 237 18 (6) (38) (8) (44) 87 120 (33) (28)
Net income available to common stockholders, Underlying (non-GAAP) N $354 $373 $365 $396 $418 ($19) (5%) ($64) (15%) $1,092 $1,452 ($360) (25%)
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)
(dollars in millions, except per share data)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
Operating leverage:
Total revenue (GAAP) C $1,901 $1,963 $1,959 $1,988 $2,014 ($62) (3.23%) ($113) (5.67%) $5,823 $6,236 ($413) (6.65%)
Less: Noninterest expense (GAAP) E 1,259 1,301 1,358 1,612 1,293 (42) (3.28) (34) (2.69) 3,918 3,895 23 0.57
Operating leverage 0.05% (2.98%) (7.22%)
Operating leverage, Underlying:
Total revenue, Underlying (non-GAAP) D $1,903 $1,959 $1,956 $1,988 $2,014 ($56) (2.88%) ($111) (5.54%) $5,818 $6,236 ($418) (6.73%)
Less: Noninterest expense, Underlying (non-GAAP) F 1,248 1,265 1,273 1,267 1,271 (17) (1.35) (23) (1.75) 3,786 3,734 52 1.38
Operating leverage, Underlying (non-GAAP) (1.53%) (3.79%) (8.11%)
Efficiency ratio and efficiency ratio, Underlying:
Efficiency ratio E/C 66.23% 66.27% 69.33% 81.13% 64.21% (4)bps 202 bps 67.28% 62.45% 483 bps
Efficiency ratio, Underlying (non-GAAP) F/D 65.61 64.59 65.05 63.77 63.08 102 bps 253 bps 65.08 59.87 521 bps
Noninterest income as a % of total revenue, Underlying:
Noninterest income as a % of total revenue A/C 27.95% 28.16% 26.41% 25.16% 24.44% (21)bps 351 bps 27.51% 23.78% 373 bps
Noninterest income as a % of total revenue, Underlying B/D 28.05 28.00 26.32 25.16 24.44 5 bps 361 bps 27.45 23.78 367 bps
Effective income tax rate and effective income tax rate, Underlying:
Effective income tax rate I/G 18.56% 18.49% 22.28% 7.59% 21.51% 7 bps (295)bps 19.69% 22.24% (255)bps
Effective income tax rate, Underlying (non-GAAP) J/H 18.75 20.33 22.84 22.25 21.69 (158)bps (294)bps 20.68 22.55 (187)bps
Return on average common equity and return on average common equity, Underlying:
Average common equity (GAAP) O $22,380 $21,427 $21,700 $21,209 $21,177 $953 4% $1,203 6% $21,838 $21,721 $117 1%
Return on average common equity M/O 6.12% 6.70% 5.63% 2.96% 7.50% (58) bps (138) bps 6.15% 8.20% (205) bps
Return on average common equity, Underlying (non-GAAP) N/O 6.29 7.00 6.77 7.41 7.82 (71) bps (153) bps 6.68 8.93 (225) bps
Return on average tangible common equity and return on average tangible common equity, Underlying:
Average common equity (GAAP) O $22,380 $21,427 $21,700 $21,209 $21,177 $953 4% $1,203 6% $21,838 $21,721 $117 1%
Less: Average goodwill (GAAP) 8,187 8,188 8,188 8,188 8,188 (1) - (1) - 8,187 8,182 5 -
Less: Average other intangibles (GAAP) 140 144 153 163 173 (4) (3) (33) (19) 146 182 (36) (20)
Add: Average deferred tax liabilities related to goodwill (GAAP) 435 432 433 421 422 3 1 13 3 433 422 11 3
Average tangible common equity P $14,488 $13,527 $13,792 $13,279 $13,238 $961 7% $1,250 9% $13,938 $13,779 $159 1%
Return on average tangible common equity M/P 9.45% 10.61% 8.86% 4.72% 12.00% (116)bps (255)bps 9.63% 12.93% (330)bps
Return on average tangible common equity, Underlying (non-GAAP) N/P 9.71 % 11.09 % 10.65 % 11.84 % 12.51 % (138)bps (280)bps 10.46 % 14.09 % (363)bps
Return on average total assets and return on average total assets, Underlying:
Average total assets (GAAP) Q $218,578 $219,222 $220,770 $223,653 $220,162 ($644) -% ($1,584) (1%) $219,520 $221,739 ($2,219) (1%)
Return on average total assets K/Q 0.70 % 0.72 % 0.61 % 0.33 % 0.78 % (2) bps (8) bps 0.67 % 0.86 % (19) bps
Return on average total assets, Underlying (non-GAAP) L/Q 0.71 % 0.75 % 0.72 % 0.76 % 0.81 % (4) bps (10) bps 0.73 % 0.93 % (20) bps
Return on average total tangible assets and return on average total tangible assets, Underlying:
Average total assets (GAAP) Q $218,578 $219,222 $220,770 $223,653 $220,162 ($644) -% ($1,584) (1%) $219,520 $221,739 ($2,219) (1%)
Less: Average goodwill (GAAP) 8,187 8,188 8,188 8,188 8,188 (1) - (1) - 8,187 8,182 5 -
Less: Average other intangibles (GAAP) 140 144 153 163 173 (4) (3) (33) (19) 146 182 (36) (20)
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP) 435 432 433 421 422 3 1 13 3 433 422 11 3
Average tangible assets R $210,686 $211,322 $212,862 $215,723 $212,223 ($636) -% ($1,537) (1%) $211,620 $213,797 ($2,177) (1%)
Return on average total tangible assets K/R 0.72% 0.75% 0.63% 0.35% 0.81% (3) bps (9) bps 0.70% 0.89% (19) bps
Return on average total tangible assets, Underlying (non-GAAP) L/R 0.74 0.78 0.75 0.78 0.84 (4) bps (10) bps 0.75 0.96 (21) bps
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (CONTINUED)
(dollars in millions, except per share data)
QUARTERLY TRENDS FOR THE NINE MONTHS ENDED SEPTEMBER 30,
3Q24 Change 2024 Change
3Q24 2Q24 1Q24 4Q23 3Q23 2Q24 3Q23 2024 2023 2023
$/bps % $/bps % $/bps %
Tangible book value per common share:
Common shares - at period-end (GAAP) S 445,216,549 452,961,853 458,485,032 466,418,055 466,221,795 (7,745,304) (2%) (21,005,246) (5%) 445,216,549 466,221,795 (21,005,246) (5%)
Common stockholders' equity (GAAP) $22,819 $21,757 $21,747 $22,329 $20,864 $1,062 5 $1,955 9 $22,819 $20,864 $1,955 9
Less: Goodwill (GAAP) 8,187 8,187 8,188 8,188 8,188 - - (1) - 8,187 8,188 (1) -
Less: Other intangible assets (GAAP) 137 139 148 157 167 (2) (1) (30) (18) 137 167 (30) (18)
Add: Deferred tax liabilities related to goodwill and other intangible assets (GAAP) 435 435 433 433 421 - - 14 3 435 421 14 3
Tangible common equity T $14,930 $13,866 $13,844 $14,417 $12,930 $1,064 8% $2,000 15% $14,930 $12,930 $2,000 15%
Tangible book value per common share T/S $33.54 $30.61 $30.19 $30.91 $27.73 $2.93 10% $5.81 21% $33.54 $27.73 $5.81 21%
Net income per average common share - basic and diluted and net income per average common share - basic and diluted, Underlying:
Average common shares outstanding - basic (GAAP) U 446,561,996 454,142,489 461,358,681 466,234,324 469,481,085 (7,580,493) (2%) (22,919,089) (5%) 453,993,833 478,073,507 (24,079,674) (5%)
Average common shares outstanding - diluted (GAAP) V 449,913,467 456,561,022 463,797,964 468,159,167 471,183,719 (6,647,555) (1) (21,270,252) (5) 456,461,330 479,733,008 (23,271,678) (5)
Net income per average common share - basic (GAAP) M/U $0.77 $0.79 $0.66 $0.34 $0.85 ($0.02) (3) ($0.08) (9) $2.21 $2.79 ($0.58) (21)
Net income per average common share - diluted (GAAP) M/V 0.77 0.78 0.65 0.34 0.85 (0.01) (1) (0.08) (9) 2.20 2.78 (0.58) (21)
Net income per average common share - basic, Underlying (non-GAAP) N/U 0.79 0.82 0.79 0.85 0.89 (0.03) (4) (0.10) (11) 2.40 3.04 (0.64) (21)
Net income per average common share - diluted, Underlying (non-GAAP) N/V 0.79 0.82 0.79 0.85 0.89 (0.03) (4) (0.10) (11) 2.39 3.03 (0.64) (21)
Dividend payout ratio and dividend payout ratio, Underlying:
Cash dividends declared and paid per common share W $0.42 $0.42 $0.42 $0.42 $0.42 $- -% $- -% $1.26 $1.26 $- -%
Dividend payout ratio W/(M/U) 55% 53% 64% 124% 49% 139 bps 514 bps 57 % 45 % 1,185 bps
Dividend payout ratio, Underlying (non-GAAP) W/(N/U) 53 51 53 49 47 200 bps 600 bps 53 41 1,200 bps
Card fees, Underlying:
Card fees (GAAP) $93 $92 $86 $70 $74 $1 1% $19 26% $271 $226 $45 20%
Less: Notable items 6 4 3 - - 2 50 6 100 13 - 13 100
Card fees, Underlying (non-GAAP) $87 $88 $83 $70 $74 ($1) (1%) $13 18% $258 $226 $32 14%
Mortgage banking fees, Underlying:
Mortgage banking fees (GAAP) $46 $54 $49 $57 $69 ($8) (15) ($23) (33) $149 $185 ($36) (19)
Less: Notable items - - - - - - - - - - - - -
Mortgage banking fees, Underlying (non-GAAP) $46 $54 $49 $57 $69 ($8) (15) ($23) (33) $149 $185 ($36) (19)
Other income, Underlying
Other income (GAAP) $24 $10 $17 $20 $18 $14 - 140% $6 - 33% $51 $58 ($7) (12%)
Less: Notable items (8) - - - - (8) (100) (8) (100) (8) - (8) (100)
Other income, Underlying (non-GAAP) $32 $10 $17 $20 $18 $22 220% $14 78% $59 $58 $1 2%
Salaries and employee benefits, Underlying:
Salaries and employee benefits (GAAP) $647 $645 $691 $667 $659 $2 - -% ($12) - (2%) $1,983 $1,932 $51 3%
Less: Notable items 4 8 17 32 5 (4) (50) (1) (20) 29 35 (6) (17)
Salaries and employee benefits, Underlying (non-GAAP) $643 $637 $674 $635 $654 $6 1% ($11) (2%) $1,954 $1,897 $57 3%
Equipment and software, Underlying:
Equipment and software (GAAP) $194 $190 $192 $215 $191 $4 2% $3 2% $576 $541 $35 6%
Less: Notable items 2 4 8 37 6 (2) (50) (4) (67) 14 14 - -
Equipment and software, Underlying (non-GAAP) $192 $186 $184 $178 $185 $6 3% $7 4% $562 $527 $35 7%
Outside services, Underlying:
Outside services (GAAP) $146 $165 $158 $174 $160 ($19) - (12%) ($14) - (9%) $469 $513 ($44) (9%)
Less: Notable items 2 10 12 13 7 (8) (80) (5) (71) 24 55 (31) (56)
Outside services, Underlying (non-GAAP) $144 $155 $146 $161 $153 ($11) (7%) ($9) (6%) $445 $458 ($13) (3%)
Occupancy, Underlying:
Occupancy (GAAP) $108 $113 $114 $125 $107 ($5) (4%) $1 1% $335 $367 ($32) (9%)
Less: Notable items 1 6 7 20 2 (5) (83) (1) (50) 14 50 (36) (72)
Occupancy, Underlying (non-GAAP) $107 $107 $107 $105 $105 $- -% $2 2% $321 $317 $4 1%
Other operating expense, Underlying:
Other operating expense (GAAP) $164 $188 $203 $431 $176 ($24) - (13%) ($12) - (7%) $555 $542 $13 2%
Less: Notable items 2 8 41 243 2 (6) (75) - - 51 7 44 NM
Other operating expense, Underlying (non-GAAP) $162 $180 $162 $188 $174 ($18) (10%) ($12) (7%) $504 $535 ($31) (6%)

Segments Non-GAAP QTD

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS
(dollars in millions)
THIRD QUARTER 2024 SECOND QUARTER 2024
Consumer Banking Commercial Banking Non-Core Other Consolidated Consumer Banking Commercial Banking Non-Core Other Consolidated
Net income (loss) available to common stockholders:
Net income (loss) A $327 $231 ($51) ($125) $382 $296 $259 ($50) ($113) $392
Less: Preferred stock dividends - - - 38 38 - - - 35 35
Less: Impact of preferred stock redemption - - - - - - - - - -
Net income (loss) available to common stockholders B $327 $231 ($51) ($163) $344 $296 $259 ($50) ($148) $357
Return on average total tangible assets:
Average total assets (GAAP) $75,392 $68,092 $8,389 $66,705 $218,578 $74,295 $68,958 $9,418 $66,551 $219,222
Less: Average goodwill (GAAP) 542 769 - 6,876 8,187 542 770 - 6,876 8,188
Average other intangibles (GAAP) 83 29 - 28 140 87 31 - 26 144
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP) 27 9 - 399 435 27 9 - 396 432
Average tangible assets C $74,794 $67,303 $8,389 $60,200 $210,686 $73,693 $68,166 $9,418 $60,045 $211,322
Return on average total tangible assets A/C 1.74% 1.37% (2.40%) NM 0.72% 1.61% 1.52% (2.14%) NM 0.75%
Efficiency ratio:
Noninterest expense (GAAP) D $916 $300 $23 $20 $1,259 $915 $311 $26 $49 $1,301
Net interest income (GAAP) 1,156 478 (28) (237) 1,369 1,120 494 (31) (173) 1,410
Noninterest income (GAAP) 285 207 - 40 532 277 242 - 34 553
Total revenue (GAAP) E $1,441 $685 ($28) ($197) $1,901 $1,397 $736 ($31) ($139) $1,963
Efficiency ratio D/E 63.53% 43.84% NM NM 66.23% 65.49% 42.28% NM NM 66.27%
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS (CONTINUED)
(dollars in millions)
FIRST QUARTER 2024 FOURTH QUARTER 2023
Consumer Banking Commercial Banking Non-Core Other Consolidated Consumer Banking Commercial Banking Non-Core Other Consolidated
Net income (loss) available to common stockholders:
Net income (loss) A $272 $259 ($60) ($137) $334 $269 $269 ($72) ($277) $189
Less: Preferred stock dividends - - - 30 30 - 0 - - 30 30
Less: Impact of preferred stock redemption - - - - - - - - - -
Net income (loss) available to common stockholders B $272 $259 ($60) ($167) $304 $269 $269 ($72) ($307) $159
Return on average total tangible assets:
Average total assets (GAAP) $73,833 $70,100 $10,554 $66,283 $220,770 $73,334 $72,758 $11,776 $65,785 $223,653
Less: Average goodwill (GAAP) 542 770 - 6,876 8,188 542 770 - 6,876 8,188
Average other intangibles (GAAP) 92 33 - 28 153 98 35 - 30 163
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP) 26 10 - 397 433 26 10 - 385 421
Average tangible assets C $73,225 $69,307 $10,554 $59,776 $212,862 $72,720 $71,963 $11,776 $59,264 $215,723
Return on average total tangible assets A/C 1.49% 1.50% (2.30%) NM 0.63% 1.47% 1.48% (2.42%) NM 0.35%
Efficiency ratio:
Noninterest expense (GAAP) D $903 $317 $25 $113 $1,358 $905 $324 $28 $355 $1,612
Net interest income (GAAP) 1,093 514 (37) (128) 1,442 1,086 551 (45) (104) 1,488
Noninterest income (GAAP) 258 227 - 32 517 265 196 - 39 500
Total revenue (GAAP) E $1,351 $741 ($37) ($96) $1,959 $1,351 $747 ($45) ($65) $1,988
Efficiency ratio D/E 66.87% 42.80% NM NM 69.33% 67.08% 43.44% NM NM 81.13%
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS (CONTINUED)
(dollars in millions)
THIRD QUARTER 2023
Consumer Banking Commercial Banking Non-Core Other Consolidated
Net income (loss) available to common stockholders:
Net income (loss) A $276 $260 ($67) ($39) $430
Less: Preferred stock dividends - - - 30 30
Less: Impact of preferred stock redemption - - - - -
Net income (loss) available to common stockholders B $276 $260 ($67) ($69) $400
Return on average total tangible assets:
Average total assets (GAAP) $72,964 $74,997 $13,113 $59,088 $220,162
Less: Average goodwill (GAAP) 542 770 - 6,876 8,188
Average other intangibles (GAAP) 103 39 - 31 173
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP) 24 12 - 386 422
Average tangible assets C $72,343 $74,200 $13,113 $52,567 $212,223
Return on average total tangible assets A/C 1.51% 1.39% (2.03%) NM 0.81%
Efficiency ratio:
Noninterest expense (GAAP) D $905 $325 $30 $33 $1,293
Net interest income (GAAP) 1,067 560 (41) (64) 1,522
Noninterest income (GAAP) 278 180 - 34 492
Total revenue (GAAP) E $1,345 $740 ($41) ($30) $2,014
Efficiency ratio D/E 67.18% 43.93% NM NM 64.21%

Segments Non-GAAP YTD

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS (CONTINUED)
(dollars in millions)
FOR THE NINE MONTHS ENDED SEPTEMBER 30,
2024 2023
Consumer Banking Commercial Banking Non-Core Other Consolidated Consumer Banking Commercial Banking Non-Core Other Consolidated
Net income (loss) available to common stockholders:
Net income (loss) A $895 $749 ($161) ($375) $1,108 $790 $884 ($172) ($83) $1,419
Less: Preferred stock dividends - - - 103 103 - - - 87 87
Less: Impact of preferred stock redemption - - - - - - - - - -
Net income (loss) available to common stockholders B $895 $749 ($161) ($478) $1,005 $790 $884 ($172) ($170) $1,332
Return on average total tangible assets:
Average total assets (GAAP) $74,510 $69,046 $9,450 $66,514 $219,520 $72,477 $77,130 $14,409 $57,723 $221,739
Less: Average goodwill (GAAP) 542 770 - 6,875 8,187 540 766 - 6,876 8,182
Average other intangibles (GAAP) 87 31 - 28 146 109 41 - 32 182
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP) 27 9 - 397 433 23 12 - 387 422
Average tangible assets C $73,908 $68,254 $9,450 $60,008 $211,620 $71,851 $76,335 $14,409 $51,202 $213,797
Return on average total tangible assets A/C 1.62% 1.47% (2.28%) NM 0.70% 1.47% 1.55% (1.60%) NM 0.89%
Efficiency ratio:
Noninterest expense (GAAP) D $2,734 $928 $74 $182 $3,918 $2,637 $971 $95 $192 $3,895
Net interest income (GAAP) 3,369 1,486 (96) (538) 4,221 3,101 1,741 (84) (5) 4,753
Noninterest income (GAAP) 820 676 - 106 1,602 802 588 - 93 1,483
Total revenue (GAAP) E $4,189 $2,162 ($96) ($432) $5,823 $3,903 $2,329 ($84) $88 $6,236
Efficiency ratio D/E 65.26% 42.95% NM NM 67.28% 67.54% 41.67% NM NM 62.45%