Core Viewpoint - Regions Financial Corporation has shown strong financial performance in its recent earnings report, outperforming estimates in both earnings per share and revenue, driven by a recovery in dealmaking activities and stronger capital markets [2][3]. Financial Performance - The company reported earnings per share of $0.63, exceeding the estimated $0.60 [2]. - Revenue was approximately $1.94 billion, surpassing the estimated $1.93 billion [2]. - The share price increased by approximately 1% in premarket trading, reflecting positive investor sentiment [3]. Profitability Metrics - Regions Financial has higher income from interests, contributing to overall profitability [3]. - The price-to-earnings (P/E) ratio is approximately 13.34, indicating investor confidence in the company's earnings potential [3]. - The earnings yield is approximately 7.50%, making it attractive for income-seeking investors [5]. Valuation Ratios - The price-to-sales ratio and enterprise value to sales ratio both stand at about 2.30, suggesting investors are willing to pay $2.30 for every dollar of sales generated [4]. - The enterprise value to operating cash flow ratio is around 7.77, indicating efficient cash flow management [4].

Core Insights - Investor fears regarding worsening credit conditions eased as regional bank earnings provided relief after a significant market downturn [1][2] - The KBW regional bank index rose after a sharp decline of 6% on Thursday, marking its worst single-day pullback since April [1] Group 1: Regional Bank Earnings - Investors reacted positively to earnings reports from regional banks such as Truist Financial, Fifth Third Bancorp, Huntington Bancshares, and Ally Financial, with most stocks rising in early trading [2] - Loan loss provisions were lower than analysts' expectations for most banks, except for Huntington [2] Group 2: Credit Quality and Risks - Trust CEO Bill Rogers stated that overall credit quality remains strong, despite some idiosyncratic events in the market [3] - The scrutiny of regional banks increased after Western Alliance and Zions disclosed bad loans linked to fraud, causing significant stock declines [4] - Concerns were heightened by recent bankruptcies in the auto lending sector, with Fifth Third reporting a $200 million increase in net charge-offs compared to the previous quarter [6] Group 3: Market Reactions - Stocks of Western Alliance and Zions recovered on Friday after their initial declines, along with Jefferies Financial, which was affected by an auto parts supplier's bankruptcy [4] - Investors in the sector tend to react quickly to credit concerns, often selling first and asking questions later [5]

Financial Data and Key Metrics Changes - The company reported strong quarterly earnings of $548 million, resulting in earnings per share of $0.61, with adjusted earnings of $561 million or $0.63 per share [4] - Adjusted pre-tax, pre-provision income increased by 4% year over year to $830 million, with a return on tangible common equity of 19% [4][6] - Net interest income was relatively stable, with a modest growth expected between 3% and 4% for the full year 2025 [11][13] Business Line Data and Key Metrics Changes - Average loans grew by 1%, while ending loans declined by 1%, with growth in financial services, government, and public sectors [9] - Wealth management generated record fee income, and capital markets income, excluding CBA, also reached a record high [6][15] - Non-interest income increased by 6% quarter over quarter, driven by higher service charges and capital markets activity [14][15] Market Data and Key Metrics Changes - The company achieved top quartile deposit growth and above peer median change in market share, maintaining the lowest deposit cost among peers [4] - Consumer deposits remained flat quarter over quarter, slightly ahead of typical seasonal trends, while commercial deposits showed strength [10] - The overall share of non-interest-bearing deposits to total deposits remained within the expected low 30% range [10] Company Strategy and Development Direction - The company is focused on modernizing core technology platforms, with plans to upgrade its commercial loan system to a new cloud platform in 2026 [7][8] - The strategic plan emphasizes organic growth through existing customer relationships and new client acquisitions, rather than pursuing M&A [37][38] - Investments in technology and talent are expected to enhance customer service and capitalize on growth opportunities [8][75] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in generating stronger loan growth moving into 2026, supported by improving macro conditions and increased line utilization [6][30] - The company anticipates continued positive trends in asset quality, with expectations for net charge-offs to be approximately 50 basis points for the full year [17][66] - Management remains vigilant regarding portfolios of interest, particularly in office and transportation sectors, while expressing optimism about overall credit quality [22][25] Other Important Information - The company executed $250 million in share repurchases and paid $235 million in common dividends during the quarter, with a common equity tier one ratio of 10.8% [18] - Adjusted non-interest expense increased by 4% compared to the prior quarter, with expectations for full-year adjusted non-interest expense to be up approximately 2% [15][16] Q&A Session Summary Question: Update on portfolios of interest and charge-offs - Management identified office and transportation as portfolios of interest, with expectations for continued elevated charge-offs but long-term guidance of 40 to 50 basis points [22][30] Question: Clarification on portfolio shaping and charge-offs - Portfolio shaping actions are a combination of addressing weaknesses in certain portfolios and proactive management of credit risk [34][54] Question: Strategic focus on M&A - The company remains focused on executing its strategic plan and does not currently see M&A as part of its strategy, despite market changes [37][38] Question: Loan growth expectations - The company expects to grow its loan portfolio consistent with GDP in its markets, with optimism for acceleration in 2026 [62] Question: Impact of CD rolls on NIM - The upcoming CD rolls are expected to significantly impact NIM, with a focus on managing deposit pricing effectively [100] Question: Salary and compensation outlook - The company does not anticipate significant changes in headcount or salary increases, maintaining a focus on efficiency through technology [104]

Core Insights - Regions Financial reported $1.92 billion in revenue for Q3 2025, a 7% year-over-year increase, with an EPS of $0.63 compared to $0.57 a year ago [1] - The reported revenue matched the Zacks Consensus Estimate, resulting in a slight revenue surprise of -0.08%, while the EPS exceeded expectations by 5% [1] Financial Performance Metrics - Net interest margin (FTE) was 3.6%, aligning with analyst estimates [4] - Efficiency Ratio stood at 57.2%, slightly above the average estimate of 56.6% [4] - Net charge-offs as a percentage of average loans were 0.6%, higher than the estimated 0.5% [4] - Common Equity Tier 1 ratio was 10.8%, matching analyst expectations [4] - Total earning assets averaged $140.37 billion, slightly below the estimate of $141.18 billion [4] - Non-performing assets totaled $788 million, better than the estimated $850.99 million [4] - Non-performing loans amounted to $770 million, also better than the estimate of $842.99 million [4] - Leverage Ratio was 9.7%, consistent with analyst estimates [4] - Tier 1 Capital Ratio was 11.9%, matching the average estimate [4] - Total Non-Interest Income reached $659 million, exceeding the estimate of $645.45 million [4] - Net Interest Income was $1.26 billion, slightly below the estimate of $1.27 billion [4] - Net interest income on a taxable equivalent basis was $1.27 billion, lower than the estimated $1.29 billion [4] Stock Performance - Regions Financial shares have returned -14.8% over the past month, contrasting with the Zacks S&P 500 composite's +0.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3]

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Financial Performance - Net income available to common shareholders was $548 million, or $061 per diluted share[5] - Adjusted net income available to common shareholders was $561 million, or $063 per diluted share[5] - Total revenue reached $1916 million, with adjusted total revenue at $1941 million[5] - Pre-Tax Pre-Provision Income was $813 million, with adjusted Pre-Tax Pre-Provision Income at $830 million[5] - The efficiency ratio was 572%, with an adjusted efficiency ratio of 569%[5] - Return on Average Tangible Common Equity was 1881%, with an adjusted Return on Average Tangible Common Equity of 1924%[5] Loans and Deposits - Average loans grew by approximately 1%, while ending loans declined by approximately 1%[12] - Average business loans increased by 1%, driven by C&I and real estate[12] - Average consumer loans remained relatively stable[12] - Average deposits by segment: Wealth Management $404 billion, Consumer Bank $797 billion, Corporate Bank $76 billion, Other $26 billion[14] - Average balances in the Corporate Banking Group increased by more than 1%[15] Net Interest Income (NII) and Margin - NII was $1269 million, and the Net Interest Margin (NIM) was 359%[17] - NII is expected to increase by 1-2% in Q4 2025 compared to Q3 2025, with NIM in the mid-360%s[22] - FY25 NII is now expected to grow between 3-4%[22] Non-Interest Income and Expense - Non-interest income was $684 million[30] - Capital Markets (Ex CVA) revenue increased 224%[31] - Adjusted non-interest income is expected to grow between 4-5% for FY25[33] - Non-interest expense was $1103 million, with an adjusted non-interest expense of $1111 million[35] - Adjusted non-interest expense is expected to be up approximately 2% for FY25[38]

Core Insights - Regions Financial (RF) reported quarterly earnings of $0.63 per share, exceeding the Zacks Consensus Estimate of $0.60 per share, and showing an increase from $0.57 per share a year ago, resulting in an earnings surprise of +5.00% [1] - The company posted revenues of $1.92 billion for the quarter ended September 2025, slightly missing the Zacks Consensus Estimate by 0.08%, but up from $1.79 billion year-over-year [2] - Regions Financial has surpassed consensus EPS estimates in all four of the last quarters, but has only topped revenue estimates once in the same period [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.60 on revenues of $1.94 billion, while for the current fiscal year, the estimate is $2.33 on revenues of $7.55 billion [7] - The estimate revisions trend for Regions Financial was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Banks - Southeast industry, to which Regions Financial belongs, is currently ranked in the top 29% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Regions Financial reported an increase in third-quarter profit, attributed to stronger capital markets and higher interest income, resulting in a roughly 1% rise in shares during premarket trading [1] Financial Performance - The company experienced a rise in profit for the third quarter, indicating positive financial performance [1] - The increase in profit was driven by stronger capital markets, suggesting improved market conditions [1] - Higher income from interests contributed significantly to the profit increase, highlighting effective interest income management [1]

[**Financial Highlights**](index=3&type=section&id=Financial%20Highlights) [**Earnings Summary**](index=3&type=section&id=Earnings%20Summary) The company reported an increase in net income and diluted EPS for the third quarter of 2025 compared to the previous quarter and the prior year, indicating improved profitability Earnings Metrics | Metric | 9/30/2025 | 6/30/2025 | 9/30/2024 | | :----------------------------------- | :-------- | :-------- | :-------- | | Net income (millions) | $569 | $563 | $490 | | Net income available to common shareholders (millions) | $548 | $534 | $446 | | Diluted earnings per common share | $0.61 | $0.59 | $0.49 | - Adjusted diluted earnings per common share (non-GAAP) **increased** to **$0.63** in Q3 2025 from **$0.60** in Q2 2025 and **$0.57** in Q3 2024[4](index=4&type=chunk) [**Balance Sheet Summary**](index=3&type=section&id=Balance%20Sheet%20Summary) The balance sheet showed a slight increase in total assets and shareholders' equity, while loans and deposits experienced minor fluctuations in Q3 2025 Balance Sheet Metrics | Metric | 9/30/2025 | 6/30/2025 | 9/30/2024 | | :----------------------------------- | :-------- | :-------- | :-------- | | Loans, net of unearned income (millions) | $96,125 | $96,723 | $96,789 | | Assets (millions) | $159,940 | $159,206 | $157,426 | | Deposits (millions) | $130,334 | $130,919 | $126,376 | | Shareholders' equity (millions) | $19,049 | $18,666 | $18,676 | - Average loans, net of unearned income, **increased** to **$96,647 million** in Q3 2025 from **$96,077 million** in Q2 2025, but **decreased** from **$97,040 million** in Q3 2024[4](index=4&type=chunk) [**Selected Ratios and Other Information**](index=4&type=section&id=Selected%20Ratios%20and%20Other%20Information) [**Key Financial Ratios**](index=4&type=section&id=Key%20Financial%20Ratios) Profitability ratios showed mixed trends, with Return on Average Assets slightly decreasing QoQ but increasing YoY. Efficiency ratios fluctuated, while capital adequacy ratios remained stable or improved Key Financial Ratios Overview | Metric | 9/30/2025 (%) | 6/30/2025 (%) | 9/30/2024 (%) | | :----------------------------------- | :-------- | :-------- | :-------- | | Return on average assets | 1.42 % | 1.43 % | 1.26 % |\ | Return on average common shareholders' equity | 12.56 % | 12.72 % | 10.88 % |\ | Efficiency ratio | 57.2 % | 56.0 % | 59.3 % |\ | Common equity Tier 1 ratio | 10.8 % | 10.8 % | 10.6 % |\ | Net interest margin (FTE) | 3.59 % | 3.65 % | 3.54 % |\ | Net charge-offs as a percentage of average loans | 0.55 % | 0.47 % | 0.48 % | - The dividend payout ratio for Q3 2025 was **43.0%**, an **increase** from **42.0%** in Q2 2025 but a **decrease** from **51.3%** in Q3 2024[6](index=6&type=chunk) - Tangible common book value per share (non-GAAP) **increased** to **$13.49** in Q3 2025 from **$12.91** in Q2 2025 and **$12.26** in Q3 2024[6](index=6&type=chunk) [**Operational Metrics**](index=4&type=section&id=Operational%20Metrics) Operational metrics show a slight increase in associate headcount and a minor reduction in ATMs and total branch outlets Operational Metrics Overview | Metric | 9/30/2025 | 6/30/2025 | 9/30/2024 | | :----------------------------------- | :-------- | :-------- | :-------- | | Associate headcount—full-time equivalent | 19,675 | 19,642 | 19,560 |\ | ATMs | 1,874 | 1,996 | 2,019 |\ | Total branch outlets | 1,248 | 1,250 | 1,261 | [**Consolidated Balance Sheets**](index=5&type=section&id=Consolidated%20Balance%20Sheets) [**Assets**](index=5&type=section&id=Assets) Total assets increased slightly in Q3 2025, driven by higher interest-bearing deposits in other banks and debt securities held to maturity, while net loans saw a minor decrease Consolidated Assets | Asset Category | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Cash and due from banks | $3,073 | $3,245 | $2,665 |\ | Interest-bearing deposits in other banks | $9,026 | $7,930 | $7,856 |\ | Debt securities held to maturity | $5,769 | $5,972 | $2,787 |\ | Debt securities available for sale | $26,886 | $26,333 | $28,698 |\ | Loans, net of unearned income | $96,125 | $96,723 | $96,789 |\ | Total assets | $159,940 | $159,206 | $157,426 | [**Liabilities and Equity**](index=5&type=section&id=Liabilities%20and%20Equity) Total deposits experienced a slight decline in Q3 2025, primarily in non-interest-bearing and time deposits, while shareholders' equity increased due to higher retained earnings and a reduction in accumulated other comprehensive loss Consolidated Liabilities and Equity | Liability/Equity Category | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Non-interest-bearing deposits | $39,768 | $40,209 | $39,698 |\ | Interest-bearing deposits | $90,566 | $90,710 | $86,678 |\ | Total deposits | $130,334 | $130,919 | $126,376 |\ | Short-term borrowings | $1,300 | $— | $1,500 |\ | Long-term borrowings | $4,785 | $5,279 | $6,016 |\ | Total liabilities | $140,845 | $140,500 | $138,699 |\ | Total shareholders' equity | $19,049 | $18,666 | $18,676 | - Accumulated other comprehensive income (loss), net, **improved** from **$(1,967) million** in Q2 2025 to **$(1,660) million** in Q3 2025[9](index=9&type=chunk) [**Loans**](index=6&type=section&id=Loans) [**End of Period Loans**](index=6&type=section&id=End%20of%20Period%20Loans) Total end-of-period loans decreased slightly in Q3 2025, primarily driven by declines in commercial and industrial, owner-occupied commercial real estate, and other consumer loans, partially offset by growth in commercial investor real estate mortgage and consumer credit card portfolios End of Period Loan Balances | Loan Category | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Commercial and industrial | $49,234 | $(352) (-0.7%) | $(331) (-0.7%) |\ | Commercial investor real estate mortgage | $7,122 | $173 (2.5%) | $560 (8.5%) |\ | Residential first mortgage | $19,881 | $(139) (-0.7%) | $(244) (-1.2%) |\ | Consumer credit card | $1,437 | $22 (1.6%) | $65 (4.7%) |\ | Other consumer | $5,834 | $(69) (-1.2%) | $(333) (-5.4%) |\ | Total Loans | $96,125 | $(598) (-0.6%) | $(664) (-0.7%) | Loan Portfolio Composition | Loan Category (Percentage) | 9/30/2025 (%) | 6/30/2025 (%) | 9/30/2024 (%) | | :----------------------------------- | :-------- | :-------- | :-------- | | Total business | 66.0 % | 66.0 % | 65.7 % |\ | Total consumer | 34.0 % | 34.0 % | 34.3 % | [**Average Balances of Loans**](index=7&type=section&id=Average%20Balances%20of%20Loans) Average loan balances for Q3 2025 showed a slight increase QoQ, primarily in business loans, but a decrease YoY. Year-to-date average loan balances for 2025 were lower than 2024 Average Loan Balances (Quarterly) | Loan Category (Average Balances) | 3Q25 (millions) | Change vs. 2Q25 (millions) | Change vs. 3Q24 (millions) | | :----------------------------------- | :-------------- | :------------------------- | :------------------------- | | Commercial and industrial | $49,588 | $555 (1.1%) | $(259) (-0.5%) |\ | Commercial investor real estate mortgage | $7,087 | $282 (4.1%) | $592 (9.1%) |\ | Total business | $63,860 | $648 (1.0%) | $42 (0.1%) |\ | Total consumer | $32,787 | $(78) (-0.2%) | $(435) (-1.3%) |\ | Total Loans | $96,647 | $570 (0.6%) | $(393) (-0.4%) | Average Loan Balances (Year-to-Date) | Loan Category (Average Balances YTD) | 2025 (millions) | Change vs. 2024 (millions) | | :----------------------------------- | :-------------- | :------------------------- | | Total business | $63,406 | $(551) (-0.9%) |\ | Total consumer | $32,878 | $(411) (-1.2%) |\ | Total Loans | $96,284 | $(962) (-1.0%) | [**Deposits**](index=8&type=section&id=Deposits) [**End of Period Deposits**](index=8&type=section&id=End%20of%20Period%20Deposits) Total end-of-period deposits decreased slightly QoQ but increased YoY, with notable growth in money market deposits and a decline in time deposits. Corporate Bank and Wealth Management segments showed deposit growth YoY End of Period Deposit Balances | Deposit Type | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Non-interest-bearing deposits | $39,768 | $(441) (-1.1%) | $70 (0.2%) |\ | Money market—domestic | $39,051 | $526 (1.4%) | $3,846 (10.9%) |\ | Time deposits | $14,902 | $(392) (-2.6%) | $(782) (-5.0%) |\ | Total Deposits | $130,334 | $(585) (-0.4%) | $3,958 (3.1%) | Segment Deposit Balances | Segment Deposits | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Consumer Bank Segment | $79,689 | $(264) (-0.3%) | $831 (1.1%) |\ | Corporate Bank Segment | $40,415 | $314 (0.8%) | $3,460 (9.4%) |\ | Wealth Management Segment | $7,654 | $302 (4.1%) | $134 (1.8%) | - Non-interest-bearing deposits as a percentage of total deposits **decreased** to **30.5%** in Q3 2025 from **30.7%** in Q2 2025 and **31.4%** in Q3 2024[17](index=17&type=chunk) [**Average Balances of Deposits**](index=9&type=section&id=Average%20Balances%20of%20Deposits) Average deposit balances showed a slight QoQ increase and a more significant YoY increase. Money market deposits were a key driver of growth, while non-interest-bearing and time deposits saw declines Average Deposit Balances (Quarterly) | Deposit Type (Average Balances) | 3Q25 (millions) | Change vs. 2Q25 (millions) | Change vs. 3Q24 (millions) | | :----------------------------------- | :-------------- | :------------------------- | :------------------------- | | Non-interest-bearing deposits | $39,538 | $(18) (—%) | $(152) (-0.4%) |\ | Money market—domestic | $38,593 | $1,204 (3.2%) | $3,542 (10.1%) |\ | Time deposits | $15,124 | $(210) (-1.4%) | $(303) (-2.0%) |\ | Total Deposits | $129,575 | $131 (0.1%) | $3,625 (2.9%) | Average Deposit Balances (Year-to-Date) | Segment Deposits (Average Balances YTD) | 2025 (millions) | Change vs. 2024 (millions) | | :----------------------------------- | :-------------- | :------------------------- | | Corporate Bank Segment | $39,098 | $2,231 (6.1%) |\ | Total Deposits | $128,909 | $2,253 (1.8%) | [**Consolidated Statements of Income**](index=10&type=section&id=Consolidated%20Statements%20of%20Income) [**Quarter Ended**](index=10&type=section&id=Quarter%20Ended) For Q3 2025, net interest income slightly decreased QoQ but increased YoY, while non-interest income saw a notable increase. Provision for credit losses decreased, contributing to higher net income Consolidated Statements of Income (Quarterly) | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Total interest income | $1,796 | $1,784 | $1,820 |\ | Total interest expense | $539 | $525 | $602 |\ | Net interest income | $1,257 | $1,259 | $1,218 |\ | Provision for credit losses | $105 | $126 | $113 |\ | Non-interest income | $659 | $646 | $572 |\ | Non-interest expense | $1,103 | $1,073 | $1,069 |\ | Net income | $569 | $563 | $490 | - Interest income on loans, including fees, was **$1,386 million** in Q3 2025, a **slight increase** from **$1,377 million** in Q2 2025 but a **decrease** from **$1,463 million** in Q3 2024[20](index=20&type=chunk) - Interest expense on deposits **increased** to **$456 million** in Q3 2025 from **$447 million** in Q2 2025, but **decreased** from **$507 million** in Q3 2024[20](index=20&type=chunk) [**Nine Months Ended September 30**](index=11&type=section&id=Nine%20Months%20Ended%20September%2030) For the nine months ended September 30, 2025, net interest income and non-interest income increased significantly compared to the same period in 2024, leading to higher net income and diluted EPS Consolidated Statements of Income (Year-to-Date) | Metric | 2025 (millions) | 2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :-------------- | :-------------- | :---------------- | :--------- | | Total interest income | $5,305 | $5,306 | $(1) | (0.0%) |\ | Total interest expense | $1,595 | $1,718 | $(123) | (7.2%) |\ | Net interest income | $3,710 | $3,588 | $122 | 3.4% |\ | Provision for credit losses | $355 | $367 | $(12) | (3.3%) |\ | Non-interest income | $1,895 | $1,680 | $215 | 12.8% |\ | Non-interest expense | $3,215 | $3,204 | $11 | 0.3% |\ | Net income | $1,622 | $1,359 | $263 | 19.4% |\ | Diluted earnings per common share | $1.72 | $1.38 | $0.34 | 24.6% | - Interest income on debt securities **increased** by **$176 million** (**26.3%**) year-to-date 2025 compared to 2024[23](index=23&type=chunk) [**Consolidated Average Daily Balances and Yield / Rate Analysis**](index=12&type=section&id=Consolidated%20Average%20Daily%20Balances%20and%20Yield%20%2F%20Rate%20Analysis) [**Quarter Ended Yield/Rate Analysis**](index=12&type=section&id=Quarter%20Ended%20Yield%2FRate%20Analysis) For Q3 2025, the yield on total earning assets slightly decreased QoQ, while the rate on total interest-bearing liabilities slightly increased. Net interest spread and net interest margin (FTE) both saw minor declines QoQ Yield and Rate Analysis (Quarterly) | Metric | 9/30/2025 (%) | 6/30/2025 (%) | 9/30/2024 (%) | | :----------------------------------- | :-------- | :-------- | :-------- | | Yield on Total earning assets | 5.09 % | 5.12 % | 5.26 % |\ | Rate on Total interest-bearing liabilities | 2.22 % | 2.20 % | 2.59 % |\ | Net interest spread | 2.87 % | 2.92 % | 2.67 % |\ | Net interest income/margin FTE basis | 3.59 % | 3.65 % | 3.54 % | - The yield on commercial and industrial loans **decreased** to **5.65%** in Q3 2025 from **5.72%** in Q2 2025 and **6.14%** in Q3 2024[24](index=24&type=chunk)[28](index=28&type=chunk) - The rate for total deposit costs **remained stable** at **1.39%** in Q3 2025 compared to Q2 2025, but **decreased** from **1.60%** in Q3 2024[26](index=26&type=chunk)[31](index=31&type=chunk) [**Nine Months Ended September 30 Yield/Rate Analysis**](index=14&type=section&id=Nine%20Months%20Ended%20September%2030%20Yield%2FRate%20Analysis) For the nine months ended September 30, 2025, the yield on total earning assets slightly decreased compared to 2024, while the rate on total interest-bearing liabilities also decreased. Net interest spread improved, and net interest margin (FTE) increased Yield and Rate Analysis (Year-to-Date) | Metric | 2025 (%) | 2024 (%) | | :----------------------------------- | :--- | :--- | | Yield on Total earning assets | 5.08 % | 5.19 % |\ | Rate on Total interest-bearing liabilities | 2.23 % | 2.53 % |\ | Net interest spread | 2.85 % | 2.66 % |\ | Net interest income/margin FTE basis | 3.59 % | 3.54 % | - The yield on commercial and industrial loans **decreased** to **5.65%** year-to-date 2025 from **6.06%** in 2024[33](index=33&type=chunk) - Total deposit costs **decreased** to **1.39%** year-to-date 2025 from **1.58%** in 2024[35](index=35&type=chunk) [**Pre-Tax Pre-Provision Income ("PPI") and Adjusted PPI (non-GAAP)**](index=15&type=section&id=Pre-Tax%20Pre-Provision%20Income%20%28%22PPI%22%29%20and%20Adjusted%20PPI%20%28non-GAAP%29) [**Pre-Tax Pre-Provision Income Analysis**](index=15&type=section&id=Pre-Tax%20Pre-Provision%20Income%20Analysis) Pre-tax pre-provision income (non-GAAP) decreased QoQ but increased YoY, while adjusted pre-tax pre-provision income (non-GAAP) remained relatively stable QoQ and increased YoY, after accounting for various adjustments Pre-Tax Pre-Provision Income Reconciliation | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Income before income taxes (GAAP) | $708 | $706 | $608 |\ | Provision for credit losses (GAAP) | $105 | $126 | $113 |\ | Pre-tax pre-provision income (non-GAAP) | $813 | $832 | $721 |\ | Adjusted pre-tax pre-provision income (non-GAAP) | $830 | $832 | $799 | - Total other adjustments, including securities gains/losses and FDIC insurance special assessment, **significantly impacted** the reconciliation from PPI to Adjusted PPI, with a **$17 million positive adjustment** in Q3 2025[37](index=37&type=chunk) - Securities (gains) losses, net, showed a **gain of $25 million** in Q3 2025, compared to zero in Q2 2025 and a **loss of $78 million** in Q3 2024[37](index=37&type=chunk) [**Non-Interest Income, Service Charges on Deposit Accounts by Segment, Wealth Management Income, Capital Markets Income, and Mortgage Income**](index=16&type=section&id=Non-Interest%20Income%2C%20Service%20Charges%20on%20Deposit%20Accounts%20by%20Segment%2C%20Wealth%20Management%20Income%2C%20Capital%20Markets%20Income%2C%20and%20Mortgage%20Income) [**Quarterly Non-Interest Income**](index=16&type=section&id=Quarterly%20Non-Interest%20Income) Total non-interest income increased QoQ and YoY, driven by strong performance in service charges on deposit accounts, wealth management income, and capital markets income, despite a decrease in mortgage income Non-Interest Income (Quarterly) | Income Category | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Service charges on deposit accounts | $160 | $9 (6.0%) | $2 (1.3%) |\ | Wealth management income | $139 | $6 (4.5%) | $11 (8.6%) |\ | Capital markets income | $104 | $21 (25.3%) | $12 (13.0%) |\ | Mortgage income | $38 | $(10) (-20.8%) | $2 (5.6%) |\ | Securities gains (losses), net | $(27) | $(26) (NM) | $51 (65.4%) |\ | Total non-interest income | $659 | $13 (2.0%) | $87 (15.2%) | - Other miscellaneous income **increased significantly** by **$20 million** (**52.6%**) QoQ to **$58 million** in Q3 2025[39](index=39&type=chunk) [**Quarterly Service Charges on Deposit Accounts by Segment**](index=16&type=section&id=Quarterly%20Service%20Charges%20on%20Deposit%20Accounts%20by%20Segment) Service charges on deposit accounts increased QoQ, primarily driven by the Consumer Bank Segment, while the Corporate Bank Segment also showed growth Service Charges on Deposit Accounts by Segment (Quarterly) | Segment | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Consumer Bank Segment | $99 | $9 (10.0%) | $(1) (-1.0%) |\ | Corporate Bank Segment | $61 | $1 (1.7%) | $3 (5.2%) |\ | Total service charges on deposit accounts | $160 | $9 (6.0%) | $2 (1.3%) | - Consumer overdraft fees represent approximately **half** of the Consumer Bank Segment's service charges on deposit accounts each quarter[44](index=44&type=chunk) [**Quarterly Wealth Management Income**](index=16&type=section&id=Quarterly%20Wealth%20Management%20Income) Wealth management income increased QoQ and YoY, with both investment management and trust fee income and investment services fee income contributing to the growth Wealth Management Income (Quarterly) | Income Type | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Investment management and trust fee income | $91 | $1 (1.1%) | $6 (7.1%) |\ | Investment services fee income | $48 | $5 (11.6%) | $5 (11.6%) |\ | Total wealth management income | $139 | $6 (4.5%) | $11 (8.6%) | [**Quarterly Capital Markets Income**](index=16&type=section&id=Quarterly%20Capital%20Markets%20Income) Capital markets income showed significant QoQ and YoY growth, indicating strong performance in capital raising activities Capital Markets Income (Quarterly) | Income Type | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Capital markets income | $104 | $21 (25.3%) | $12 (13.0%) |\ | Capital markets income excluding valuation adjustments | $104 | $19 (22.4%) | $11 (11.8%) | - Capital markets income **primarily relates to** debt securities underwriting and placement, loan syndication, foreign exchange, derivatives, and M&A advisory services[43](index=43&type=chunk) [**Quarterly Mortgage Income**](index=16&type=section&id=Quarterly%20Mortgage%20Income) Mortgage income decreased QoQ but increased YoY, primarily due to a significant negative MSR and related hedge impact, despite stable production and sales and loan servicing income Mortgage Income (Quarterly) | Income Type | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Production and sales | $17 | $— (—%) | $1 (6.3%) |\ | Loan servicing | $47 | $— (—%) | $(6) (-11.3%) |\ | MSR and related hedge impact | $(26) | $(10) (-62.5%) | $7 (21.2%) |\ | Total mortgage income | $38 | $(10) (-20.8%) | $2 (5.6%) | - Total mortgage production **decreased** by **$149 million** (**-13.3%**) QoQ to **$969 million** in Q3 2025[43](index=43&type=chunk) [**Year-to-Date Non-Interest Income**](index=17&type=section&id=Year-to-Date%20Non-Interest%20Income) Total non-interest income for the nine months ended September 30, 2025, increased significantly YoY, driven by strong growth across most categories, particularly securities gains (losses), net, wealth management, and capital markets income Non-Interest Income (Year-to-Date) | Income Category | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Service charges on deposit accounts | $472 | $457 | $15 | 3.3% |\ | Wealth management income | $401 | $369 | $32 | 8.7% |\ | Capital markets income | $267 | $251 | $16 | 6.4% |\ | Mortgage income | $126 | $111 | $15 | 13.5% |\ | Securities gains (losses), net | $(53) | $(178) | $125 | 70.2% |\ | Total non-interest income | $1,895 | $1,680 | $215 | 12.8% | [**Year-to-Date Service Charges on Deposit Accounts by Segment**](index=17&type=section&id=Year-to-Date%20Service%20Charges%20on%20Deposit%20Accounts%20by%20Segment) Year-to-date service charges on deposit accounts increased YoY, primarily due to growth in the Corporate Bank Segment, while the Consumer Bank Segment saw a slight decrease Service Charges on Deposit Accounts by Segment (Year-to-Date) | Segment | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Consumer Bank Segment | $285 | $287 | $(2) | (0.7%) |\ | Corporate Bank Segment | $185 | $167 | $18 | 10.8% |\ | Total service charges on deposit accounts | $472 | $457 | $15 | 3.3% | [**Year-to-Date Wealth Management Income**](index=17&type=section&id=Year-to-Date%20Wealth%20Management%20Income) Year-to-date wealth management income increased YoY, with both investment management and trust fee income and investment services fee income contributing to the growth Wealth Management Income (Year-to-Date) | Income Type | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Investment management and trust fee income | $267 | $249 | $18 | 7.2% |\ | Investment services fee income | $134 | $120 | $14 | 11.7% |\ | Total wealth management income | $401 | $369 | $32 | 8.7% | [**Year-to-Date Capital Markets Income**](index=17&type=section&id=Year-to-Date%20Capital%20Markets%20Income) Year-to-date capital markets income increased YoY, reflecting strong performance in capital markets activities Capital Markets Income (Year-to-Date) | Income Type | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Capital markets income | $267 | $251 | $16 | 6.4% |\ | Capital markets income excluding valuation adjustments | $270 | $256 | $14 | 5.5% | [**Year-to-Date Mortgage Income**](index=17&type=section&id=Year-to-Date%20Mortgage%20Income) Year-to-date mortgage income increased YoY, primarily due to an improved MSR and related hedge impact, offsetting a decline in production and sales income Mortgage Income (Year-to-Date) | Income Type | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Production and sales | $47 | $56 | $(9) | (16.1%) |\ | Loan servicing | $141 | $143 | $(2) | (1.4%) |\ | MSR and related hedge impact | $(62) | $(88) | $26 | 29.5% |\ | Total mortgage income | $126 | $111 | $15 | 13.5% | - Total mortgage production **remained relatively stable** year-to-date, with portfolio production **increasing** by **5.3%** and agency/secondary market production **decreasing** by **4.8%**[51](index=51&type=chunk) [**Non-Interest Expense**](index=18&type=section&id=Non-Interest%20Expense) [**Quarterly Non-Interest Expense**](index=18&type=section&id=Quarterly%20Non-Interest%20Expense) Total non-interest expense increased QoQ and YoY, primarily driven by higher salaries and employee benefits, outside services, and professional, legal and regulatory expenses Non-Interest Expense (Quarterly) | Expense Category | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Salaries and employee benefits | $671 | $13 (2.0%) | $26 (4.0%) |\ | Equipment and software expense | $106 | $2 (1.9%) | $5 (5.0%) |\ | Outside services | $42 | $3 (7.7%) | $1 (2.4%) |\ | Professional, legal and regulatory expenses | $30 | $2 (7.1%) | $9 (42.9%) |\ | FDIC insurance assessments | $15 | $(5) (-25.0%) | $(2) (-11.8%) |\ | Total non-interest expense | $1,103 | $30 (2.8%) | $34 (3.2%) | - Visa class B shares expense **increased significantly** by **$4 million** (**100.0%**) QoQ to **$8 million** in Q3 2025, but **decreased** by **$9 million** (**-52.9%**) YoY[54](index=54&type=chunk) [**Quarterly Salaries and Benefits Expense**](index=18&type=section&id=Quarterly%20Salaries%20and%20Benefits%20Expense) Salaries and employee benefits expense increased QoQ and YoY. Excluding market value adjustments on 401(k) liabilities, the increase was more pronounced Salaries and Benefits Expense (Quarterly) | Expense Type | 9/30/2025 (millions) | Change vs. 6/30/2025 (millions) | Change vs. 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------------------ | :------------------------------ | | Salaries and employee benefits | $671 | $13 (2.0%) | $26 (4.0%) |\ | Salaries and employee benefits less market value adjustments on employee benefits liabilities | $658 | $16 (2.5%) | $25 (3.9%) | [**Year-to-Date Non-Interest Expense**](index=18&type=section&id=Year-to-Date%20Non-Interest%20Expense) Total non-interest expense for the nine months ended September 30, 2025, remained relatively stable YoY, with increases in salaries and employee benefits and professional, legal and regulatory expenses offset by decreases in FDIC insurance assessments and operational losses Non-Interest Expense (Year-to-Date) | Expense Category | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Salaries and employee benefits | $1,954 | $1,912 | $42 | 2.2% |\ | Professional, legal and regulatory expenses | $81 | $74 | $7 | 9.5% |\ | FDIC insurance assessments | $55 | $89 | $(34) | (38.2%) |\ | Operational losses | $44 | $79 | $(35) | (44.3%) |\ | Total non-interest expense | $3,215 | $3,204 | $11 | 0.3% | [**Year-to-Date Salaries and Benefits Expense**](index=18&type=section&id=Year-to-Date%20Salaries%20and%20Benefits%20Expense) Year-to-date salaries and employee benefits expense increased YoY. Excluding market value adjustments on 401(k) liabilities, the increase was slightly higher Salaries and Benefits Expense (Year-to-Date) | Expense Type | 9/30/2025 (millions) | 9/30/2024 (millions) | Change (millions) | Change (%) | | :----------------------------------- | :------------------- | :------------------- | :---------------- | :--------- | | Salaries and employee benefits | $1,954 | $1,912 | $42 | 2.2% |\ | Salaries and employee benefits less market value adjustments on employee benefits liabilities | $1,926 | $1,878 | $48 | 2.6% | [**Reconciliation of GAAP Financial Measures to non-GAAP Financial Measures**](index=19&type=section&id=Reconciliation%20of%20GAAP%20Financial%20Measures%20to%20non-GAAP%20Financial%20Measures) [**Adjusted Efficiency Ratios, Adjusted Fee Income Ratios, Adjusted Non-Interest Income/Expense, Adjusted Operating Leverage Ratios, and Adjusted Total Revenue (Quarterly)**](index=19&type=section&id=Adjusted%20Efficiency%20Ratios%2C%20Adjusted%20Fee%20Income%20Ratios%2C%20Adjusted%20Non-Interest%20Income%2FExpense%2C%20Adjusted%20Operating%20Leverage%20Ratios%2C%20and%20Adjusted%20Total%20Revenue%20%28Quarterly%29) For Q3 2025, the adjusted efficiency ratio slightly increased QoQ but remained stable YoY. Adjusted total revenue (non-GAAP) increased QoQ and YoY, while adjusted non-interest expense (non-GAAP) also increased Adjusted Financial Ratios and Revenue (Quarterly) | Metric | 9/30/2025 (%) | 6/30/2025 (%) | 9/30/2024 (%) | | :----------------------------------- | :-------- | :-------- | :-------- | | Adjusted non-interest expense (non-GAAP) | $1,111 | $1,073 | $1,069 |\ | Adjusted total revenue (non-GAAP) | $1,941 | $1,905 | $1,868 |\ | Adjusted efficiency ratio (non-GAAP) | 56.9 % | 56.0 % | 56.9 % |\ | Adjusted fee income ratio (non-GAAP) | 35.0 % | 33.7 % | 34.6 % | - Adjusted operating leverage ratio (non-GAAP) was **(1.7)%** in Q3 2025, compared to **0%** in Q3 2024[59](index=59&type=chunk) [**Adjusted Efficiency Ratios, Adjusted Fee Income Ratios, Adjusted Non-Interest Income/Expense, Adjusted Operating Leverage Ratios, and Adjusted Total Revenue (YTD)**](index=20&type=section&id=Adjusted%20Efficiency%20Ratios%2C%20Adjusted%20Fee%20Income%20Ratios%2C%20Adjusted%20Non-Interest%20Income%2FExpense%2C%20Adjusted%20Operating%20Leverage%20Ratios%2C%20and%20Adjusted%20Total%20Revenue%20%28YTD%29) For the nine months ended September 30, 2025, the adjusted efficiency ratio (non-GAAP) improved YoY. Adjusted total revenue (non-GAAP) and adjusted non-interest expense (non-GAAP) both increased YoY Adjusted Financial Ratios and Revenue (Year-to-Date) | Metric | 2025 (%) | 2024 (%) | | :----------------------------------- | :--- | :--- | | Adjusted non-interest expense (non-GAAP) | $3,219 | $3,198 |\ | Adjusted total revenue (non-GAAP) | $5,655 | $5,446 |\ | Adjusted efficiency ratio (non-GAAP) | 56.5 % | 58.3 % |\ | Adjusted fee income ratio (non-GAAP) | 34.2 % | 33.9 % | - Adjusted operating leverage ratio (non-GAAP) was **3.2%** year-to-date 2025[62](index=62&type=chunk) [**Adjusted Net Income Available to Common Shareholders, Adjusted Diluted EPS, and Return Ratios**](index=21&type=section&id=Adjusted%20Net%20Income%20Available%20to%20Common%20Shareholders%2C%20Adjusted%20Diluted%20EPS%2C%20and%20Return%20Ratios) Adjusted net income available to common shareholders (non-GAAP) and adjusted diluted EPS (non-GAAP) both increased QoQ and YoY. Return on average tangible common shareholders' equity (non-GAAP) slightly decreased QoQ but increased YoY Adjusted Profitability and Return Ratios | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Net income available to common shareholders (GAAP) | $548 | $534 | $446 |\ | Adjusted net income available to common shareholders (non-GAAP) | $561 | $538 | $520 |\ | Diluted EPS (GAAP) | $0.61 | $0.59 | $0.49 |\ | Adjusted diluted EPS (non-GAAP) | $0.63 | $0.60 | $0.57 |\ | Return on average tangible common shareholders' equity (non-GAAP) | 18.81 % | 19.34 % | 16.87 % |\ | Adjusted return on average tangible common shareholders' equity (non-GAAP) | 19.24 % | 19.48 % | 19.68 % | - Average tangible common shareholders' equity (non-GAAP) **increased** by **$490 million** (**4.4%**) QoQ and **$1,052 million** (**10.0%**) YoY[65](index=65&type=chunk) [**Tangible Common Ratios**](index=22&type=section&id=Tangible%20Common%20Ratios) Tangible common shareholders' equity (non-GAAP) and tangible common book value per share (non-GAAP) both increased QoQ and YoY, reflecting an improved capital position Tangible Common Equity Ratios | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Common shareholders' equity (GAAP) | $17,680 | $17,297 | $16,961 |\ | Tangible common shareholders' equity (non-GAAP) | $11,934 | $11,541 | $11,172 |\ | Tangible common shareholders' equity to tangible assets (non-GAAP) | 7.74 % | 7.52 % | 7.37 % |\ | Tangible common book value per share (non-GAAP) | $13.49 | $12.91 | $12.26 | [**Common equity Tier 1 (CET1) Ratios**](index=22&type=section&id=Common%20equity%20Tier%201%20%28CET1%29%20Ratios) The Common Equity Tier 1 (CET1) ratio remained stable QoQ and increased YoY. The adjusted common equity Tier 1 ratio (non-GAAP) also showed an increase QoQ and YoY, indicating a strong capital position Common Equity Tier 1 Ratios | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Common equity Tier 1 | $13,620 | $13,533 | $13,185 |\ | Adjusted common equity Tier 1 (non-GAAP) | $11,983 | $11,647 | $11,379 |\ | Total risk-weighted assets | $126,060 | $125,755 | $124,645 |\ | Common equity Tier 1 ratio | 10.8 % | 10.8 % | 10.6 % |\ | Adjusted common equity Tier 1 ratio (non-GAAP) | 9.5 % | 9.3 % | 9.1 % | - Adjustments to CET1 include AOCI loss on securities and defined benefit pension plans, which are considered in the adjusted non-GAAP measure[70](index=70&type=chunk) [**Asset Quality**](index=23&type=section&id=Asset%20Quality) [**Allowance for Credit Losses, Net Charge-Offs and Related Ratios**](index=23&type=section&id=Allowance%20for%20Credit%20Losses%2C%20Net%20Charge-Offs%20and%20Related%20Ratios) The allowance for credit losses (ACL) decreased QoQ but remained relatively stable YoY. Net charge-offs increased QoQ, primarily driven by commercial investor real estate mortgage and other consumer loans, leading to a higher net charge-off ratio Allowance for Credit Losses and Net Charge-Offs | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Beginning allowance for loan losses (ALL) | $1,612 | $1,613 | $1,621 |\ | Total loans charged-off | $160 | $133 | $143 |\ | Total recoveries of loans previously charged-off | $25 | $20 | $26 |\ | Total net charge-offs | $135 | $113 | $117 |\ | Provision for loan losses | $104 | $112 | $103 |\ | Ending allowance for loan losses (ALL) | $1,581 | $1,612 | $1,607 |\ | Allowance for credit losses (ACL) at period end | $1,713 | $1,743 | $1,728 | Net Charge-Off Ratios | Net loan charge-offs as a % of average loans, annualized | 9/30/2025 (%) | 6/30/2025 (%) | 9/30/2024 (%) | | :----------------------------------- | :-------- | :-------- | :-------- | | Commercial investor real estate mortgage | 1.82 % | 0.10 % | 0.71 % |\ | Other consumer | 2.83 % | 2.50 % | 2.37 % |\ | Total | 0.55 % | 0.47 % | 0.48 % | - ACL as a percentage of loans, net, was **1.78%** in Q3 2025, a **slight decrease** from **1.80%** in Q2 2025[75](index=75&type=chunk) [**Non-Performing Loans (excludes loans held for sale), Early and Late Stage Delinquencies**](index=26&type=section&id=Non-Performing%20Loans%20%28excludes%20loans%20held%20for%20sale%29%2C%20Early%20and%20Late%20Stage%20Delinquencies) Non-performing loans (excluding loans held for sale) decreased QoQ and YoY. Total delinquencies also decreased QoQ and YoY, indicating an improvement in overall loan quality Non-Performing Loans and Delinquencies | Metric | 9/30/2025 (millions) | 6/30/2025 (millions) | 9/30/2024 (millions) | | :----------------------------------- | :------------------- | :------------------- | :------------------- | | Total non-performing loans | $758 | $776 | $821 |\ | Total accruing 30-89 days past due loans | $363 | $312 | $369 |\ | Total accruing 90+ days past due loans | $154 | $171 | $183 |\ | Total delinquencies | $517 | $483 | $552 | - Non-performing loans as a percentage of loans, excluding loans held for sale, **improved** to **0.79%** in Q3 2025 from **0.80%** in Q2 2025 and **0.85%** in Q3 2024[78](index=78&type=chunk) - Criticized loans—business **decreased significantly** to **$3,682 million** in Q3 2025 from **$4,608 million** in Q2 2025 and **$4,692 million** in Q3 2024[75](index=75&type=chunk) [**Forward-Looking Statements**](index=27&type=section&id=Forward-Looking%20Statements) [**Risks and Uncertainties**](index=27&type=section&id=Risks%20and%20Uncertainties) The company's forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially. These include economic and market conditions, changes in monetary and fiscal policies, interest rate volatility, creditworthiness of customers, and regulatory changes - **Key risks** include the effects of possible declines in property values, **increases** in interest rates and unemployment rates, inflation, and financial market disruptions[81](index=81&type=chunk) - Changes in market interest rates or capital markets could **adversely affect** revenue, expense, asset values, and the availability and cost of capital and liquidity[81](index=81&type=chunk) - The company highlights risks related to its ability to effectively compete with traditional and non-traditional financial services companies, including fintechs, and the challenges presented by the development and use of AI[81](index=81&type=chunk) [**Operational and Regulatory Risks**](index=27&type=section&id=Operational%20and%20Regulatory%20Risks) Operational risks encompass fraud, cybersecurity threats, and dependence on third-party infrastructure. Regulatory risks include changes in laws and regulations, compliance with capital and liquidity requirements, and potential adverse judicial or administrative rulings - Inability to identify and address cyber-security risks such as data security breaches, malware, and denial of service attacks could **disrupt businesses** and lead to **financial losses or reputational damage**[81](index=81&type=chunk) - Changes in laws and regulations affecting bank products and services, including special FDIC assessments and new long-term debt requirements, could **increase compliance risk** and **negatively affect businesses**[85](index=85&type=chunk) - The company's ability to comply with stress testing and capital planning requirements (CCAR process) **requires significant managerial resources**[85](index=85&type=chunk)

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