Annual report pursuant to Section 13 and 15(d)

Business Segment Information

v3.22.4
Business Segment Information
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Business Segment Information Business Segment Information
The Corporation reports its results of operations through the following four business segments: Consumer Banking, Global Wealth & Investment Management, Global Banking and Global Markets, with the remaining operations recorded in All Other.
Consumer Banking
Consumer Banking offers a diversified range of credit, banking and investment products and services to consumers and small businesses. Consumer Banking product offerings include traditional savings accounts, money market savings accounts, CDs and IRAs, checking accounts, and investment accounts and products, as well as credit and debit cards, residential mortgages and home equity loans, and direct and indirect loans to consumers and small businesses in the U.S. Consumer Banking includes the impact of servicing residential mortgages and home equity loans.
Global Wealth & Investment Management
GWIM provides a high-touch client experience through a network of financial advisors focused on clients with over $250,000 in total investable assets, including tailored solutions to meet clients’ needs through a full set of investment management, brokerage, banking and retirement products. GWIM also provides comprehensive wealth management solutions targeted to high net worth and ultra high net worth clients, as well as customized solutions to meet clients’ wealth structuring, investment management, trust and banking needs, including specialty asset management services.
Global Banking
Global Banking provides a wide range of lending-related products and services, integrated working capital management and treasury solutions, and underwriting and advisory services through the Corporation’s network of offices and client relationship teams. Global Banking also provides investment banking products to clients. The economics of certain investment banking and underwriting activities are shared primarily between Global Banking and Global Markets under an internal revenue-sharing arrangement. Global Banking clients generally include middle-market companies, commercial real estate firms, not-for-profit companies, large global corporations, financial institutions, leasing clients, and mid-sized U.S.-based businesses requiring customized and integrated financial advice and solutions.
Global Markets
Global Markets offers sales and trading services and research services to institutional clients across fixed-income, credit, currency, commodity and equity businesses. Global Markets provides market-making, financing, securities clearing, settlement and custody services globally to institutional investor clients in support of their investing and trading activities. Global Markets product coverage includes securities and derivative products in both the primary and secondary markets. Global Markets also works with commercial and corporate clients to provide risk management products. As a result of market-making activities, Global Markets may be required to manage risk in a broad range of financial products. In addition, the economics of certain investment banking and underwriting activities are shared primarily between Global Markets and Global Banking under an internal revenue-sharing arrangement.
All Other
All Other primarily consists of ALM activities, liquidating businesses and certain expenses not otherwise allocated to a business segment. ALM activities encompass interest rate and foreign currency risk management activities for which substantially all of the results are allocated to the business segments.
Basis of Presentation
The management accounting and reporting process derives segment and business results by utilizing allocation methodologies for revenue and expense. The net income derived for the businesses is dependent upon revenue and cost allocations using an activity-based costing model, funds transfer pricing, and other methodologies and assumptions management believes are appropriate to reflect the results of the business.
Total revenue, net of interest expense, includes net interest income on an FTE basis and noninterest income. The adjustment of net interest income to an FTE basis results in a corresponding increase in income tax expense. The segment results also reflect certain revenue and expense methodologies that are utilized to determine net income. The net interest income of the businesses includes the results of a funds transfer pricing process that matches assets and liabilities with similar interest rate sensitivity and maturity characteristics. In segments where the total of liabilities and equity exceeds assets, which are generally deposit-taking segments, the Corporation allocates assets to match liabilities. Net interest income of the business segments also includes an allocation of net interest income generated by certain of the Corporation’s ALM activities.
The Corporation’s ALM activities include an overall interest rate risk management strategy that incorporates the use of
various derivatives and cash instruments to manage fluctuations in earnings and capital that are caused by interest rate volatility. The Corporation’s goal is to manage interest rate sensitivity so that movements in interest rates do not significantly adversely affect earnings and capital. The results of a majority of the Corporation’s ALM activities are allocated to the business segments and fluctuate based on the performance of the ALM activities. ALM activities include external product pricing decisions including deposit pricing strategies, the effects of the Corporation’s internal funds transfer pricing process and the net effects of other ALM activities.
Certain expenses not directly attributable to a specific business segment are allocated to the segments. The costs of certain centralized or shared functions are allocated based on methodologies that reflect utilization.
Effective October 1, 2021, a business activity previously
included in the Global Markets segment is being reported as a liquidating business in All Other, consistent with a realignment in performance reporting to senior management. While this activity was not material to Global Markets’ results of operations and historical results have not been restated, this activity’s noninterest expense of $309 million and $473 million for the three months ended September 30, 2021 and June 30, 2021 was elevated and would have been excluded from Global Markets’ results of operations for those periods under the new basis of presentation.
The table below presents net income (loss) and the components thereto (with net interest income on an FTE basis for the business segments, All Other and the total Corporation) for 2022, 2021 and 2020, and total assets at December 31, 2022, 2021 and 2020 for each business segment, as well as All Other.
Results of Business Segments and All Other
At and for the year ended December 31
Total Corporation (1)
Consumer Banking
(Dollars in millions) 2022 2021 2020 2022 2021 2020
Net interest income $ 52,900  $ 43,361  $ 43,859  $ 30,045  $ 24,929  $ 24,698 
Noninterest income 42,488  46,179  42,168  8,590  9,076  8,564 
Total revenue, net of interest expense 95,388  89,540  86,027  38,635  34,005  33,262 
Provision for credit losses 2,543  (4,594) 11,320  1,980  (1,035) 5,765 
Noninterest expense 61,438  59,731  55,213  20,077  19,290  18,882 
Income before income taxes 31,407  34,403  19,494  16,578  15,750  8,615 
Income tax expense 3,879  2,425  1,600  4,062  3,859  2,111 
Net income $ 27,528  $ 31,978  $ 17,894  $ 12,516  $ 11,891  $ 6,504 
Year-end total assets $ 3,051,375  $ 3,169,495  $ 1,126,453  $ 1,131,142   
  Global Wealth & Investment Management Global Banking
  2022 2021 2020 2022 2021 2020
Net interest income $ 7,466  $ 5,664  $ 5,468  $ 12,184  $ 8,511  $ 9,013 
Noninterest income 14,282  15,084  13,116  10,045  12,364  9,974 
Total revenue, net of interest expense 21,748  20,748  18,584  22,229  20,875  18,987 
Provision for credit losses 66  (241) 357  641  (3,201) 4,897 
Noninterest expense 15,490  15,258  14,160  10,966  10,632  9,342 
Income before income taxes 6,192  5,731  4,067  10,622  13,444  4,748 
Income tax expense 1,517  1,404  996  2,815  3,630  1,282 
Net income $ 4,675  $ 4,327  $ 3,071  $ 7,807  $ 9,814  $ 3,466 
Year-end total assets $ 368,893  $ 438,275  $ 588,466  $ 638,131   
  Global Markets All Other
  2022 2021 2020 2022 2021 2020
Net interest income $ 3,088  $ 4,011  $ 4,646  $ 117  $ 246  $ 34 
Noninterest income 15,050  15,244  14,119  (5,479) (5,589) (3,605)
Total revenue, net of interest expense 18,138  19,255  18,765  (5,362) (5,343) (3,571)
Provision for credit losses 28  65  251  (172) (182) 50 
Noninterest expense 12,420  13,032  11,417  2,485  1,519  1,412 
Income (loss) before income taxes 5,690  6,158  7,097  (7,675) (6,680) (5,033)
Income tax expense (benefit) 1,508  1,601  1,845  (6,023) (8,069) (4,634)
Net income (loss) $ 4,182  $ 4,557  $ 5,252  $ (1,652) $ 1,389  $ (399)
Year-end total assets $ 812,489  $ 747,794  $ 155,074  $ 214,153   
(1)There were no material intersegment revenues.
The tables below present noninterest income and the associated components for 2022, 2021 and 2020 for each business segment, All Other and the total Corporation. For more information, see Note 2 – Net Interest Income and Noninterest Income.
Noninterest Income by Business Segment and All Other
Total Corporation Consumer Banking Global Wealth &
Investment Management
(Dollars in millions) 2022 2021 2020 2022 2021 2020 2022 2021 2020
Fees and commissions:
Card income
Interchange fees $ 4,096  $ 4,560  $ 3,954  $ 3,239  $ 3,597  $ 3,027  $ 20  $ 43  $ 36 
Other card income 1,987  1,658  1,702  1,930  1,575  1,646  50  42  42 
Total card income 6,083  6,218  5,656  5,169  5,172  4,673  70  85  78 
Service charges
Deposit-related fees 5,190  6,271  5,991  2,706  3,538  3,417  65  72  67 
Lending-related fees 1,215  1,233  1,150  —  —  —  8  —  — 
Total service charges 6,405  7,504  7,141  2,706  3,538  3,417  73  72  67 
Investment and brokerage services
Asset management fees 12,152  12,729  10,708  195  188  146  11,957  12,541  10,578 
Brokerage fees 3,749  3,961  3,866  109  132  127  1,604  1,771  1,692 
Total investment and brokerage services
15,901  16,690  14,574  304  320  273  13,561  14,312  12,270 
Investment banking fees
Underwriting income 1,970  5,077  4,698  —  —  —  189  388  391 
Syndication fees 1,070  1,499  861  —  —  —  —  —  — 
Financial advisory services 1,783  2,311  1,621  —  —  —  —  —  — 
Total investment banking fees 4,823  8,887  7,180  —  —  —  189  388  391 
Total fees and commissions 33,212  39,299  34,551  8,179  9,030  8,363  13,893  14,857  12,806 
Market making and similar activities 12,075  8,691  8,355  10  1  2  102  40  63 
Other income (loss) (2,799) (1,811) (738) 401  45  199  287  187  247 
Total noninterest income $ 42,488  $ 46,179  $ 42,168  $ 8,590  $ 9,076  $ 8,564  $ 14,282  $ 15,084  $ 13,116 
Global Banking Global Markets
All Other (1)
2022 2021 2020 2022 2021 2020 2022 2021 2020
Fees and commissions:
Card income
Interchange fees $ 767  $ 700  $ 499  $ 66  $ 220  $ 391  $ 4  $ —  $ 1 
Other card income 7  13  14  —  —  —  —  28  — 
Total card income 774  713  513  66  220  391  4  28  1 
Service charges
Deposit-related fees 2,310  2,508  2,298  101  146  177  8  7  32 
Lending-related fees 983  1,015  940  224  218  210  —  —  — 
Total service charges 3,293  3,523  3,238  325  364  387  8  7  32 
Investment and brokerage services
Asset management fees —  —  —  —  —  —  —  —  (16)
Brokerage fees 42  104  74  2,002  1,979  1,973  (8) (25) — 
Total investment and brokerage services
42  104  74  2,002  1,979  1,973  (8) (25) (16)
Investment banking fees
Underwriting income 796  2,187  2,070  1,176  2,725  2,449  (191) (223) (212)
Syndication fees 565  781  482  505  718  379  —  —  — 
Financial advisory services 1,643  2,139  1,458  139  173  163  1  (1) — 
Total investment banking fees 3,004  5,107  4,010  1,820  3,616  2,991  (190) (224) (212)
Total fees and commissions 7,113  9,447  7,835  4,213  6,179  5,742  (186) (214) (195)
Market making and similar activities 215  145  103  11,406  8,760  8,471  342  (255) (284)
Other income (loss) 2,717  2,772  2,036  (569) 305  (94) (5,635) (5,120) (3,126)
Total noninterest income $ 10,045  $ 12,364  $ 9,974  $ 15,050  $ 15,244  $ 14,119  $ (5,479) $ (5,589) $ (3,605)
(1)All Other includes eliminations of intercompany transactions.
Business Segment Reconciliations
(Dollars in millions) 2022 2021 2020
Segments’ total revenue, net of interest expense $ 100,750  $ 94,883  $ 89,598 
Adjustments (1):
     
Asset and liability management activities (164) (4) 375 
Liquidating businesses, eliminations and other (5,198) (5,339) (3,946)
FTE basis adjustment (438) (427) (499)
Consolidated revenue, net of interest expense $ 94,950  $ 89,113  $ 85,528 
Segments’ total net income 29,180  30,589  18,293 
Adjustments, net-of-tax (1):
   
Asset and liability management activities (122) 11  279 
Liquidating businesses, eliminations and other (1,530) 1,378  (678)
Consolidated net income $ 27,528  $ 31,978  $ 17,894 
December 31
2022 2021
Segments’ total assets $ 2,896,301  $ 2,955,342 
Adjustments (1):
Asset and liability management activities, including securities portfolio 1,133,375  1,363,626 
Elimination of segment asset allocations to match liabilities (1,041,793) (1,216,891)
Other 63,492  67,418 
Consolidated total assets $ 3,051,375  $ 3,169,495 
(1)Adjustments include consolidated income, expense and asset amounts not specifically allocated to individual business segments.