Item 1. FINANCIAL STATEMENTS (UNAUDITED)

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Item 1. FINANCIAL STATEMENTS (UNAUDITED)


						Page
Consolidated Balance Sheets						36
Consolidated Statements of Operations						37
Consolidated Statements of Comprehensive Income						38
Consolidated Statements of Changes in Stockholders’ Equity						39
Consolidated Statements of Cash Flows						40
Notes to Consolidated Financial Statements						41
Note 1 - Significant Accounting Policies						41
Note 2 - Securities						41
Note 3 - Loans and Leases						44
Note 4 - Credit Quality and the Allowance for Credit Losses						44
Note 5 - Mortgage Banking and Other Serviced Loans						53
Note 6 - Variable Interest Entities						55
Note 7 - Borrowed Funds						57
Note 8 - Derivatives						58
Note 9 - Accumulated Other Comprehensive Income (Loss)						62
Note 10 - Stockholders’ Equity						63
Note 11 - Commitments and Contingencies						64
Note 12 - Fair Value Measurements						65
Note 13 - Noninterest Income						69
Note 14 - Other Operating Expense						70
Note 15 - Earnings Per Share						71
Note 16 - Business Segments						71

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CONSOLIDATED BALANCE SHEETS (UNAUDITED)


(dollars in millions, except par value)	March 31, 2026	December 31, 2025
ASSETS:
Cash and due from banks	$1,084	$1,464
Interest-bearing cash and due from banks	11,246	11,263
Interest-bearing deposits in banks(1)	830	961
Debt securities available for sale, at fair value (including $119 and $108 pledged to creditors, respectively)(2)	36,361	35,697
Debt securities held to maturity (fair value of $6,998 and $7,150, respectively, and including $68 and $67 pledged to creditors, respectively)(2)	7,800	7,933
Loans held for sale (includes $917 and $1,065, respectively, measured at fair value)	1,537	1,198
Loans and leases	143,667	142,692
Less: Allowance for loan and lease losses	(1,958)	(1,943)
Net loans and leases(1)	141,709	140,749
Premises and equipment, net	874	915
Bank-owned life insurance	3,464	3,441
Goodwill	8,221	8,187
Other intangible assets(3)	112	115
Other assets(1)	14,680	14,428
TOTAL ASSETS	$227,918	$226,351
LIABILITIES AND STOCKHOLDERS’ EQUITY:
LIABILITIES:
Deposits:
Noninterest-bearing	$41,672	$40,417
Interest-bearing	142,363	142,896
Total deposits	184,035	183,313
Short-term borrowed funds	54	58
Long-term borrowed funds(1)	12,260	11,224
Other liabilities(1)	5,397	5,439
TOTAL LIABILITIES	201,746	200,034
Commitments and Contingencies (refer to Note 11)
STOCKHOLDERS’ EQUITY:
Preferred stock:
$25.00 par value,100,000,000 shares authorized; 2,150,000 shares issued and outstanding at March 31, 2026 and December 31, 2025	2,111	2,111
Common stock:
$0.01 par value, 1,000,000,000 shares authorized; 653,827,918 shares issued and 426,023,578 shares outstanding at March 31, 2026 and 652,238,745 shares issued and 429,242,174 shares outstanding at December 31, 2025	7	7
Additional paid-in capital	22,466	22,476
Retained earnings	11,631	11,345
Treasury stock, at cost, 227,804,340 and 222,996,571 shares at March 31, 2026 and December 31, 2025, respectively	(7,955)	(7,652)
Accumulated other comprehensive income (loss)	(2,088)	(1,970)
TOTAL STOCKHOLDERS’ EQUITY	26,172	26,317
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$227,918	$226,351

(1) Includes amounts in consolidated VIEs. See Note 6 for additional information.

(2) Includes only collateral pledged by the Company where counterparties have the right to sell or pledge the collateral.

(3) Excludes MSRs, which are reported in Other assets.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


	Three Months Ended March 31,
(dollars in millions, except per share data)	2026	2025
INTEREST INCOME:
Interest and fees on loans and leases	$1,884	$1,829
Interest and fees on loans held for sale	21	16
Investment securities(1)	424	418
Interest-bearing deposits in banks	91	89
Total interest income	2,420	2,352
INTEREST EXPENSE:
Deposits	715	795
Short-term borrowed funds	4	8
Long-term borrowed funds	139	158
Total interest expense	858	961
Net interest income	1,562	1,391
Provision (benefit) for credit losses	140	153
Net interest income after provision (benefit) for credit losses	1,422	1,238
NONINTEREST INCOME:
Service charges and fees	112	109
Capital markets fees	134	100
Wealth fees	100	81
Card fees	83	83
Mortgage banking fees	42	59
Foreign exchange and derivative products	44	39
Letter of credit and loan fees	50	44
Securities gains, net	7	7
Other income	34	22
Total noninterest income	606	544
NONINTEREST EXPENSE:
Salaries and employee benefits	758	696
Equipment and software	197	194
Outside services	162	155
Occupancy	114	112
Other operating expense	147	157
Total noninterest expense	1,378	1,314
Income before income tax expense	650	468
Income tax expense	133	95
NET INCOME	$517	$373
Net income available to common stockholders	$484	$340
Weighted-average common shares outstanding:
Basic	425,344,491	438,320,757
Diluted	429,894,837	442,200,180
Per common share information:
Basic earnings	$1.14	$0.78
Diluted earnings	1.13	0.77

(1) Comprised primarily of taxable interest income for all periods presented.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Net income	$517	$373
Other comprehensive income (loss), net of tax:
Cash flow hedges:
Net unrealized gains (losses) arising during the period	(124)	208
Reclassification of net (gains) losses to earnings	83	148
Investment securities:
Net unrealized gains (losses) on AFS securities arising during the period	(100)	282
Reclassification of net (gains) losses to earnings	19	13
Defined benefit plans:

Amortization of actuarial (gain) loss to earnings	4	3
Total other comprehensive income (loss), net of tax	(118)	654
Total comprehensive income (loss)	$399	$1,027

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)


	Preferred Stock		Common Stock		Additional Paid-in Capital	Retained Earnings	Treasury Stock, at Cost	Accumulated Other Comprehensive Income (Loss)	Total
(dollars and shares in millions)	Shares	Amount	Shares	Amount
Balance at January 1, 2025	2	$2,113	441	$7	$22,364	$10,412	($7,047)	($3,595)	$24,254
Dividends declared - common stock	—	—	—	—	—	(186)	—	—	(186)
Dividends declared - preferred stock	—	—	—	—	—	(33)	—	—	(33)



Treasury stock purchased	—	—	(4)	—	—	—	(200)	—	(200)
Share repurchase excise tax	—	—	—	—	—	—	(2)	—	(2)
Share-based compensation plans	—	—	1	—	(1)	—	—	—	(1)
Employee stock purchase plan	—	—	—	—	7	—	—	—	7

Total comprehensive income (loss):
Net income	—	—	—	—	—	373	—	—	373
Other comprehensive income (loss)	—	—	—	—	—	—	—	654	654
Total comprehensive income (loss)	—	—	—	—	—	373	—	654	1,027
Balance at March 31, 2025	2	$2,113	438	$7	$22,370	$10,566	($7,249)	($2,941)	$24,866
Balance at January 1, 2026	2	$2,111	429	$7	$22,476	$11,345	($7,652)	($1,970)	$26,317
Dividends declared - common stock	—	—	—	—	—	(198)	—	—	(198)
Dividends declared - preferred stock	—	—	—	—	—	(33)	—	—	(33)



Treasury stock purchased	—	—	(5)	—	—	—	(300)	—	(300)
Share repurchase excise tax	—	—	—	—	—	—	(3)	—	(3)
Share-based compensation plans	—	—	2	—	(18)	—	—	—	(18)
Employee stock purchase plan	—	—	—	—	8	—	—	—	8

Total comprehensive income (loss):
Net income	—	—	—	—	—	517	—	—	517
Other comprehensive income (loss)	—	—	—	—	—	—	—	(118)	(118)
Total comprehensive income (loss)	—	—	—	—	—	517	—	(118)	399
Balance at March 31, 2026	2	$2,111	426	$7	$22,466	$11,631	($7,955)	($2,088)	$26,172

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


	Three Months Ended March 31,
(dollars in millions)	2026	2025
OPERATING ACTIVITIES
Net income	$517	$373
Adjustments to reconcile net income to net change due to operating activities:
Provision (benefit) for credit losses	140	153
Net change in Loans held for sale	(285)	(332)
Depreciation, amortization, and accretion	113	123
Deferred income tax expense (benefit)	52	(16)
Share-based compensation	33	31
Net gain on sale of assets	(7)	(9)
Net (increase) decrease in Other assets	(256)	34
Net increase (decrease) in Other liabilities	(70)	(570)
Net change due to operating activities	237	(213)
INVESTING ACTIVITIES
Investment securities:
Purchases of debt securities available for sale	(2,516)	(2,365)
Proceeds from maturities and paydowns of debt securities available for sale	1,137	846
Proceeds from sales of debt securities available for sale	547	642

Proceeds from maturities and paydowns of debt securities held to maturity	158	150

Net (increase) decrease in Interest-bearing deposits in banks	131	(50)


Purchases of loans	(49)	(188)
Sales of loans	31	240
Net (increase) decrease in Loans and leases	(1,144)	(319)
Capital expenditures	—	(14)

Other	(97)	(50)
Net change due to investing activities	(1,802)	(1,108)
FINANCING ACTIVITIES
Net increase (decrease) in Deposits	722	2,800
Net increase (decrease) in Short-term borrowed funds	(4)	47
Proceeds from issuance of long-term borrowed funds	3,647	2,533
Repayments of long-term borrowed funds	(2,618)	(2,675)
Treasury stock purchased	(300)	(200)


Dividends paid to common stockholders	(198)	(186)
Dividends paid to preferred stockholders	(38)	(34)

Other	(43)	(24)
Net change due to financing activities	1,168	2,261
Net change in cash and cash equivalents(1)	(397)	940
Cash and cash equivalents at beginning of period(1)	12,727	10,601
Cash and cash equivalents at end of period(1)	$12,330	$11,541
Non-cash items:
Transfer of loans from loans held for investment to LHFS	$72	$1,876

(1) Cash and cash equivalents include Cash and due from banks and Interest-bearing cash and due from banks as reflected on the Consolidated Balance Sheets.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim Consolidated Financial Statements and Notes have been prepared in accordance with the instructions for Form 10-Q and, therefore, certain information and footnote disclosures required for annual financial statements prepared in accordance with GAAP are omitted. In the opinion of management, the Consolidated Financial Statements include all adjustments, consisting of normal recurring adjustments, necessary to fairly present the Company’s interim period results. These unaudited interim financial statements and Notes should be read in conjunction with the audited Consolidated Financial Statements and Notes included in the Company’s 2025 Form 10-K. The results of operations for interim periods are not necessarily indicative of the results that may be expected for the full year.

The unaudited interim Consolidated Financial Statements include the accounts of the Parent Company and its consolidated subsidiaries, including VIEs in which the Company is a primary beneficiary. Investments in VIEs in which the Company does not have the ability to exercise significant influence are not consolidated. All intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change include the determination of the ACL, fair value measurements, and the evaluation and measurement of goodwill impairment.

Significant Accounting Policies

For further information regarding the Company’s significant accounting policies, see Note 1 in the Company’s 2025 Form 10-K.

NOTE 2 - SECURITIES

The following table presents the major components of securities at amortized cost and fair value:


	March 31, 2026				December 31, 2025
(dollars in millions)	Amortized Cost(1)	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value	Amortized Cost(1)	Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
U.S. Treasury and other	$4,385	$6	($57)	$4,334	$3,163	$10	($50)	$3,123
State and political subdivisions	1	—	—	1	1	—	—	1
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	32,986	134	(1,445)	31,675	33,379	215	(1,374)	32,220
Other/non-agency	265	—	(3)	262	268	—	(4)	264
Total mortgage-backed securities	33,251	134	(1,448)	31,937	33,647	215	(1,378)	32,484
Collateralized loan obligations	89	—	—	89	89	—	—	89
Total debt securities available for sale, at fair value	$37,726	$140	($1,505)	$36,361	$36,900	$225	($1,428)	$35,697
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	$7,484	$1	($801)	$6,684	$7,595	$2	($785)	$6,812
Total mortgage-backed securities	7,484	1	(801)	6,684	7,595	2	(785)	6,812
Asset-backed securities	316	—	(2)	314	338	—	—	338
Total debt securities held to maturity	$7,800	$1	($803)	$6,998	$7,933	$2	($785)	$7,150
Equity securities, at cost(2)	$836	$—	$—	$836	$807	$—	$—	$807
Equity securities, at fair value(2)	336	—	—	336	317	—	—	317

(1) Excludes portfolio level basis adjustments of $(4) million and $17 million, respectively, for securities designated in active fair value hedge relationships under the portfolio layer method at March 31, 2026 and December 31, 2025.

(2) Included in Other assets in the Consolidated Balance Sheets.

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Accrued interest receivable on debt securities totaled $138 million and $139 million as of March 31, 2026 and December 31, 2025, respectively, and is included in Other assets in the Consolidated Balance Sheets.

The following table presents the amortized cost and fair value of debt securities by contractual maturity as of March 31, 2026. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without incurring penalties.


	Distribution of Maturities
(dollars in millions)	1 Year or Less	After 1 Year through 5 Years	After 5 Years through 10 Years	After 10 Years	Total
Amortized cost:
U.S. Treasury and other	$499	$1,928	$1,958	$—	$4,385
State and political subdivisions	—	—	—	1	1
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	209	2,309	1,352	29,116	32,986
Other/non-agency	—	—	—	265	265
Collateralized loan obligations	—	—	89	—	89
Total debt securities available for sale	708	4,237	3,399	29,382	37,726
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	—	—	7,484	7,484
Asset-backed securities	—	316	—	—	316
Total debt securities held to maturity	—	316	—	7,484	7,800
Total amortized cost of debt securities	$708	$4,553	$3,399	$36,866	$45,526

Fair value:
U.S. Treasury and other	$494	$1,888	$1,952	$—	$4,334
State and political subdivisions	—	—	—	1	1
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	208	2,269	1,302	27,896	31,675
Other/non-agency	—	—	—	262	262
Collateralized loan obligations	—	—	89	—	89
Total debt securities available for sale	702	4,157	3,343	28,159	36,361
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	—	—	—	6,684	6,684
Asset-backed securities	—	314	—	—	314
Total debt securities held to maturity	—	314	—	6,684	6,998
Total fair value of debt securities	$702	$4,471	$3,343	$34,843	$43,359

The following table presents realized gains and losses on the sale of securities:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Gains	$7	$7
Losses	—	—
Securities gains, net	$7	$7

At March 31, 2026 and December 31, 2025, debt securities with a carrying value of $3.7 billion and $3.4 billion, respectively, were pledged to secure public deposits, trust funds, FHLB borrowing capacity, repurchase agreements, and derivative contracts, and for other purposes as required or permitted by law.

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Impairment

The Company evaluated its existing HTM portfolio as of March 31, 2026 and concluded that 96% of HTM securities met the zero expected credit loss criteria and, therefore, no ACL was recognized. Lifetime expected credit losses on the remainder of the HTM portfolio were determined to be insignificant based on the modeling of the Company’s credit loss position in the securities. The Company monitors the credit exposure through the use of credit quality indicators. For these securities, the Company uses external credit ratings or an internally derived credit rating when an external rating is not available. All securities were determined to be investment grade at March 31, 2026.

The following tables present AFS debt securities with fair values below their respective carrying values, disclosed by the length of time the individual securities have been in a continuous unrealized loss position:


	March 31, 2026
	Less than 12 Months		12 Months or Longer		Total
(dollars in millions)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury and other	$1,498	($12)	$1,984	($45)	$3,482	($57)

Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	8,630	(241)	12,285	(1,204)	20,915	(1,445)
Other/non-agency	—	—	262	(3)	262	(3)
Total mortgage-backed securities	8,630	(241)	12,547	(1,207)	21,177	(1,448)

Total	$10,128	($253)	$14,531	($1,252)	$24,659	($1,505)


	December 31, 2025
	Less than 12 Months		12 Months or Longer		Total
(dollars in millions)	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses	Fair Value	Gross Unrealized Losses
U.S. Treasury and other	$—	$—	$1,990	($50)	$1,990	($50)
Mortgage-backed securities:
Federal agencies and U.S. government sponsored entities	3,415	(164)	13,098	(1,210)	16,513	(1,374)
Other/non-agency	—	—	263	(4)	263	(4)
Total mortgage-backed securities	3,415	(164)	13,361	(1,214)	16,776	(1,378)

Total	$3,415	($164)	$15,351	($1,264)	$18,766	($1,428)

The Company does not currently have the intent to sell these AFS debt securities, and it is not more likely than not that the Company will be required to sell them prior to recovery of their amortized cost bases. The Company determined that credit losses are not expected to be incurred on the AFS debt securities identified with unrealized losses as of March 31, 2026. The unrealized losses on these AFS debt securities reflect non-credit-related factors driven by changes in interest rates. Therefore, the Company determined that these AFS debt securities are not impaired.

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NOTE 3 - LOANS AND LEASES

Loans held for investment are reported at the amount of their outstanding principal, net of charge-offs, unearned income, deferred loan origination fees and costs, and unamortized premiums or discounts on purchased loans.

The following table presents loans and leases, excluding LHFS:


(dollars in millions)	March 31, 2026	December 31, 2025
Commercial and industrial	$50,307	$49,232
Commercial real estate	24,282	24,580
Total commercial	74,589	73,812
Residential mortgages	35,404	35,024
Home equity	19,449	19,069
Automobile	1,863	2,310
Education	8,340	8,416
Other retail	4,022	4,061
Total retail	69,078	68,880
Total loans and leases	$143,667	$142,692

Accrued interest receivable on loans and leases held for investment totaled $832 million and $825 million as of March 31, 2026 and December 31, 2025, respectively, and is included in Other assets in the Consolidated Balance Sheets.

Loans pledged as collateral for FHLB borrowing capacity, primarily residential mortgages and home equity products, totaled $42.5 billion and $40.8 billion at March 31, 2026 and December 31, 2025, respectively. Loans pledged as collateral to support the contingent ability to borrow at the FRB discount window, if necessary, were primarily comprised of education, commercial and industrial, and commercial real estate loans, and totaled $24.0 billion and $19.0 billion at March 31, 2026 and December 31, 2025, respectively.

Interest income on direct financing and sales-type leases for the three months ended March 31, 2026 and 2025 was $12 million and $11 million, respectively, and is reported within Interest and fees on loans and leases in the Consolidated Statements of Operations.

The following table presents the composition of LHFS:


	March 31, 2026			December 31, 2025
(dollars in millions)	Residential Mortgages(1)	Commercial(2)	Total		Residential Mortgages(1)	Commercial(2)	Total
Loans held for sale at fair value	$778	$139	$917		$895	$170	$1,065
Other loans held for sale	—	620	620		—	133	133
Total loans held for sale	$778	$759	$1,537		$895	$303	$1,198

(1) Residential mortgage LHFS at fair value are originated for sale.

(2) Commercial LHFS at fair value consist of loans managed by the Company’s commercial secondary loan desk. Other commercial LHFS primarily consist of loans associated with the Company’s syndication business.

NOTE 4 - CREDIT QUALITY AND THE ALLOWANCE FOR CREDIT LOSSES

Allowance for Credit Losses

The Company’s estimate of expected credit losses in its loan and lease portfolios is recorded in the ACL and considers extensive historical loss experience, including the impact of loss mitigation and restructuring programs that the Company offers to borrowers experiencing financial difficulty, as well as projected loss severity as a result of loan default.

For a detailed discussion of the ACL reserve methodology and estimation techniques as of December 31, 2025, see Note 4 in the Company’s 2025 Form 10-K. There were no significant changes to the ACL reserve methodology during the three months ended March 31, 2026.

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The following table presents a summary of changes in the ACL for the three months ended March 31, 2026:


	Three Months Ended March 31, 2026
(dollars in millions)	Commercial	Retail	Total
Allowance for loan and lease losses, beginning of period	$1,058	$885	$1,943



Charge-offs	(91)	(92)	(183)
Recoveries	18	27	45
Net charge-offs	(73)	(65)	(138)
Provision expense (benefit) for loans and leases	130	23	153
Allowance for loan and lease losses, end of period	1,115	843	1,958
Allowance for unfunded lending commitments, beginning of period	194	46	240


Provision expense (benefit) for unfunded lending commitments	(5)	(8)	(13)

Allowance for unfunded lending commitments, end of period	189	38	227
Total allowance for credit losses, end of period	$1,304	$881	$2,185

During the three months ended March 31, 2026, net charge-offs of $138 million and a provision for expected credit losses of $140 million resulted in a increase of $2 million to the ACL.

As of March 31, 2026, the Company’s ACL economic forecast over a two-year reasonable and supportable period contemplates a mild recession, reflecting uncertainties related to the implementation of tariffs and protectionist trade policies, inflationary pressures, the impact of higher energy prices, and geopolitical tensions. This forecast is generally applied to the retail and commercial and industrial portfolios and projects peak unemployment of approximately 5.3% and a start-to-trough real GDP decline of approximately 0.5%, consistent with peak unemployment and start-to-trough real GDP decline projections at December 31, 2025. More severe economic scenarios are applied to certain portfolios, such as CRE general office, with peak unemployment of approximately 9.5% and a start-to-trough real GDP decline of approximately 4.4%, compared to peak unemployment of approximately 9.4% and a start-to-trough real GDP decline of approximately 4.4% at December 31, 2025.

The following table presents a summary of changes in the ACL for the three months ended March 31, 2025:


	Three Months Ended March 31, 2025
(dollars in millions)	Commercial	Retail	Total
Allowance for loan and lease losses, beginning of period	$1,140	$921	$2,061



Charge-offs	(85)	(149)	(234)
Recoveries	4	30	34
Net charge-offs	(81)	(119)	(200)
Provision expense (benefit) for loans and leases	89	64	153
Allowance for loan and lease losses, end of period	1,148	866	2,014
Allowance for unfunded lending commitments, beginning of period	155	43	198


Provision expense (benefit) for unfunded lending commitments	9	(9)	—

Allowance for unfunded lending commitments, end of period	164	34	198
Total allowance for credit losses, end of period	$1,312	$900	$2,212

During the first quarter of 2025, the Company entered into an agreement to sell $1.9 billion of education loans and subsequently reclassified these loans to LHFS. Upon reclassification to LHFS, a $25 million charge-off was recognized. This transaction settled ratably each quarter throughout 2025.

Credit Quality Indicators

The Company presents loan and lease portfolio segments and classes by credit quality indicator and vintage year, with the vintage date defined as the date of the most recent credit decision for the purpose of this disclosure. Renewals are categorized as new credit decisions and reflect the renewal date as the vintage date, except for renewals of loans modified for borrowers experiencing financial difficulty, or FDMs, which are presented in the original vintage.

The Company utilizes internal risk ratings to monitor credit quality for commercial loans and leases. For more information on these ratings see Note 4 in the Company’s 2025 Form 10-K.

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The following table presents the amortized cost basis of commercial loans and leases by vintage date and internal risk rating as of March 31, 2026:


	Term Loans and Leases by Origination Year						Revolving Loans
(dollars in millions)	2026	2025	2024	2023	2022	Prior to 2022	Within the Revolving Period	Converted to Term	Total
Commercial and industrial
Pass	$1,785	$8,360	$3,783	$1,054	$1,953	$2,726	$28,106	$46	$47,813
Special Mention	—	27	5	32	80	200	452	4	800
Substandard Accrual	—	31	28	107	157	416	745	22	1,506
Nonaccrual	—	1	3	15	46	72	45	6	188
Total commercial and industrial	1,785	8,419	3,819	1,208	2,236	3,414	29,348	78	50,307
Commercial real estate
Pass	1,789	4,082	1,597	570	3,110	8,065	1,494	4	20,711
Special Mention	—	—	2	6	645	362	72	—	1,087
Substandard Accrual	—	3	58	31	462	1,117	28	106	1,805
Nonaccrual	—	—	—	3	190	483	1	2	679
Total commercial real estate	1,789	4,085	1,657	610	4,407	10,027	1,595	112	24,282
Total commercial
Pass	3,574	12,442	5,380	1,624	5,063	10,791	29,600	50	68,524
Special Mention	—	27	7	38	725	562	524	4	1,887
Substandard Accrual	—	34	86	138	619	1,533	773	128	3,311
Nonaccrual	—	1	3	18	236	555	46	8	867
Total commercial	$3,574	$12,504	$5,476	$1,818	$6,643	$13,441	$30,943	$190	$74,589

The following table presents the amortized cost basis of commercial loans and leases by vintage date and internal risk rating as of December 31, 2025:


	Term Loans and Leases by Origination Year						Revolving Loans
(dollars in millions)	2025	2024	2023	2022	2021	Prior to 2021	Within the Revolving Period	Converted to Term	Total
Commercial and industrial
Pass	$8,889	$3,985	$1,196	$2,415	$1,174	$1,966	$26,951	$77	$46,653
Special Mention	13	5	42	141	174	124	359	4	862
Substandard Accrual	13	16	104	132	145	258	752	20	1,440
Nonaccrual	—	4	15	57	17	72	107	5	277
Total commercial and industrial	8,915	4,010	1,357	2,745	1,510	2,420	28,169	106	49,232
Commercial real estate
Pass	4,769	1,827	722	3,712	3,680	4,805	1,346	4	20,865
Special Mention	—	2	7	729	294	166	73	—	1,271
Substandard Accrual	—	—	34	577	167	915	27	106	1,826
Nonaccrual	—	—	3	127	41	442	1	4	618
Total commercial real estate	4,769	1,829	766	5,145	4,182	6,328	1,447	114	24,580
Total commercial
Pass	13,658	5,812	1,918	6,127	4,854	6,771	28,297	81	67,518
Special Mention	13	7	49	870	468	290	432	4	2,133
Substandard Accrual	13	16	138	709	312	1,173	779	126	3,266
Nonaccrual	—	4	18	184	58	514	108	9	895
Total commercial	$13,684	$5,839	$2,123	$7,890	$5,692	$8,748	$29,616	$220	$73,812

For retail loans, the Company utilizes FICO credit scores and the loan’s payment and delinquency status to monitor credit quality. Management believes FICO scores are the strongest indicator of credit losses over the contractual life of the loan and assist management in predicting the borrower’s future payment performance. Scores are based on current and historical national industry-wide consumer level credit performance data.

Citizens Financial Group, Inc. | 46

The following table presents the amortized cost basis of retail loans by vintage date and current FICO score as of March 31, 2026:


	Term Loans by Origination Year						Revolving Loans
(dollars in millions)	2026	2025	2024	2023	2022	Prior to 2022	Within the Revolving Period	Converted to Term	Total
Residential mortgages
800+	$296	$2,433	$1,616	$1,263	$3,238	$10,967	$—	$—	$19,813
740-799	683	2,078	880	603	1,346	4,628	—	—	10,218
680-739	148	451	253	237	467	1,711	—	—	3,267
620-679	12	79	72	74	138	610	—	—	985
<620	—	11	18	135	140	803	—	—	1,107
No FICO available(1)	—	—	—	—	3	11	—	—	14
Total residential mortgages	1,139	5,052	2,839	2,312	5,332	18,730	—	—	35,404
Home equity
800+	—	—	3	4	7	70	6,895	193	7,172
740-799	—	1	2	3	4	50	6,200	219	6,479
680-739	—	—	3	3	4	36	3,498	200	3,744
620-679	—	—	—	1	2	19	908	156	1,086
<620	—	—	—	4	2	18	607	331	962
No FICO available(1)	—	1	—	—	2	3	—	—	6
Total home equity	—	2	8	15	21	196	18,108	1,099	19,449
Automobile
800+	—	—	—	41	186	287	—	—	514
740-799	—	—	—	49	195	247	—	—	491
680-739	—	—	—	45	152	165	—	—	362
620-679	—	—	—	27	90	97	—	—	214
<620	—	—	—	35	118	129	—	—	282
No FICO available(1)	—	—	—	—	—	—	—	—	—
Total automobile	—	—	—	197	741	925	—	—	1,863
Education
800+	65	360	257	289	501	2,686	—	—	4,158
740-799	89	442	251	248	357	1,238	—	—	2,625
680-739	34	183	118	113	149	466	—	—	1,063
620-679	3	35	39	40	47	156	—	—	320
<620	—	9	15	18	21	85	—	—	148
No FICO available(1)	—	—	—	—	—	26	—	—	26
Total education	191	1,029	680	708	1,075	4,657	—	—	8,340
Other retail
800+	8	109	46	28	31	16	506	—	744
740-799	10	106	61	36	33	26	797	—	1,069
680-739	9	73	46	31	28	26	729	1	943
620-679	6	42	22	17	23	16	264	—	390
<620	1	17	16	14	31	19	185	—	283
No FICO available(1)	11	2	—	—	—	1	579	—	593
Total other retail	45	349	191	126	146	104	3,060	1	4,022
Total retail
800+	369	2,902	1,922	1,625	3,963	14,026	7,401	193	32,401
740-799	782	2,627	1,194	939	1,935	6,189	6,997	219	20,882
680-739	191	707	420	429	800	2,404	4,227	201	9,379
620-679	21	156	133	159	300	898	1,172	156	2,995
<620	1	37	49	206	312	1,054	792	331	2,782
No FICO available(1)	11	3	—	—	5	41	579	—	639
Total retail	$1,375	$6,432	$3,718	$3,358	$7,315	$24,612	$21,168	$1,100	$69,078

(1) Represents loans for which an updated FICO score was unavailable (e.g., due to recent profile changes).

Citizens Financial Group, Inc. | 47

The following table presents the amortized cost basis of retail loans by vintage date and current FICO score as of December 31, 2025:


	Term Loans by Origination Year						Revolving Loans
(dollars in millions)	2025	2024	2023	2022	2021	Prior to 2021	Within the Revolving Period	Converted to Term	Total
Residential mortgages
800+	$2,075	$1,664	$1,290	$3,276	$4,919	$6,099	$—	$—	$19,323
740-799	2,377	960	656	1,375	2,004	2,759	—	—	10,131
680-739	621	324	239	483	646	1,136	—	—	3,449
620-679	74	74	80	141	169	491	—	—	1,029
<620	6	18	135	130	184	605	—	—	1,078
No FICO available(1)	—	—	—	3	1	10	—	—	14
Total residential mortgages	5,153	3,040	2,400	5,408	7,923	11,100	—	—	35,024
Home equity
800+	—	2	3	5	6	66	6,686	193	6,961
740-799	—	4	3	4	3	49	6,148	217	6,428
680-739	—	3	3	4	3	36	3,453	193	3,695
620-679	—	—	2	2	2	16	900	162	1,084
<620	—	—	4	2	2	14	554	321	897
No FICO available(1)	—	1	—	—	—	2	1	—	4
Total home equity	—	10	15	17	16	183	17,742	1,086	19,069
Automobile
800+	—	—	47	224	316	63	—	—	650
740-799	—	—	58	233	266	61	—	—	618
680-739	—	—	53	180	175	41	—	—	449
620-679	—	—	30	107	98	25	—	—	260
<620	—	—	39	133	127	34	—	—	333
No FICO available(1)	—	—	—	—	—	—	—	—	—
Total automobile	—	—	227	877	982	224	—	—	2,310
Education
800+	287	271	311	517	1,002	1,817	—	—	4,205
740-799	393	268	268	385	459	886	—	—	2,659
680-739	160	125	120	161	160	335	—	—	1,061
620-679	23	40	42	48	46	119	—	—	318
<620	5	13	17	25	23	61	—	—	144
No FICO available(1)	2	—	—	—	—	27	—	—	29
Total education	870	717	758	1,136	1,690	3,245	—	—	8,416
Other retail
800+	127	60	31	31	9	9	508	—	775
740-799	132	82	43	33	9	19	793	—	1,111
680-739	93	62	36	30	8	20	733	1	983
620-679	54	30	20	22	6	11	271	—	414
<620	16	21	17	29	8	10	190	—	291
No FICO available(1)	4	—	—	—	—	2	481	—	487
Total other retail	426	255	147	145	40	71	2,976	1	4,061
Total retail
800+	2,489	1,997	1,682	4,053	6,252	8,054	7,194	193	31,914
740-799	2,902	1,314	1,028	2,030	2,741	3,774	6,941	217	20,947
680-739	874	514	451	858	992	1,568	4,186	194	9,637
620-679	151	144	174	320	321	662	1,171	162	3,105
<620	27	52	212	319	344	724	744	321	2,743
No FICO available(1)	6	1	—	3	1	41	482	—	534
Total retail	$6,449	$4,022	$3,547	$7,583	$10,651	$14,823	$20,718	$1,087	$68,880

(1) Represents loans for which an updated FICO score was unavailable (e.g., due to recent profile changes).

Citizens Financial Group, Inc. | 48

The following tables present gross charge-offs by vintage date for the Company’s loan and lease portfolios:


	Three Months Ended March 31, 2026
	Term Loans and Leases by Origination Year						Revolving Loans
(dollars in millions)	2026	2025	2024	2023	2022	Prior to 2022	Within the Revolving Period	Converted to Term	Total
Commercial and industrial	$—	$1	$1	$18	$—	$1	$29	$—	$50
Commercial real estate	—	—	—	12	—	29	—	—	41
Total commercial	—	1	1	30	—	30	29	—	91
Residential mortgages	—	—	—	—	—	1	—	—	1
Home equity	—	—	—	—	—	1	5	—	6
Automobile	—	—	—	1	4	4	—	—	9
Education	—	1	1	2	4	14	—	—	22
Other retail	3	9	3	2	2	2	33	—	54
Total retail	3	10	4	5	10	22	38	—	92
Total loans and leases	$3	$11	$5	$35	$10	$52	$67	$—	$183


	Three Months Ended March 31, 2025
	Term Loans and Leases by Origination Year						Revolving Loans
(dollars in millions)	2025	2024	2023	2022	2021	Prior to 2021	Within the Revolving Period	Converted to Term	Total
Commercial and industrial	$—	$—	$1	$2	$22	$—	$9	$—	$34
Commercial real estate	—	—	—	8	—	43	—	—	51
Total commercial	—	—	1	10	22	43	9	—	85
Residential mortgages	—	—	—	—	—	1	—	—	1
Home equity	—	—	—	—	—	1	4	—	5
Automobile	—	—	2	7	7	4	—	—	20
Education	—	1	2	5	13	35	—	—	56
Other retail	4	15	8	4	2	2	32	—	67
Total retail	4	16	12	16	22	43	36	—	149
Total loans and leases	$4	$16	$13	$26	$44	$86	$45	$—	$234

Citizens Financial Group, Inc. | 49

Nonaccrual and Past Due Assets

The following tables present an aging analysis of accruing and nonaccrual loans and leases:


	March 31, 2026
		Days Past Due and Accruing
(dollars in millions)	Current	30-59	60-89	90+	Nonaccrual	Total	Nonaccrual with no related ACL
Commercial and industrial	$49,984	$122	$12	$1	$188	$50,307	$21
Commercial real estate	23,147	373	57	26	679	24,282	53
Total commercial	73,131	495	69	27	867	74,589	74
Residential mortgages	34,903	70	35	179	217	35,404	140
Home equity	18,987	105	33	—	324	19,449	204
Automobile	1,776	49	15	—	23	1,863	3
Education	8,266	33	18	2	21	8,340	6
Other retail	3,926	31	20	—	45	4,022	1
Total retail	67,858	288	121	181	630	69,078	354
Total	$140,989	$783	$190	$208	$1,497	$143,667	$428
Guaranteed residential mortgages(1)	$725	$28	$19	$179	$—	$951	$—


	December 31, 2025
		Days Past Due and Accruing
(dollars in millions)	Current	30-59	60-89	90+	Nonaccrual	Total	Nonaccrual with no related ACL
Commercial and industrial	$48,873	$63	$14	$5	$277	$49,232	$34
Commercial real estate	23,700	184	58	20	618	24,580	85
Total commercial	72,573	247	72	25	895	73,812	119
Residential mortgages	34,547	93	47	141	196	35,024	155
Home equity	18,626	95	28	1	319	19,069	215
Automobile	2,203	59	20	—	28	2,310	4
Education	8,342	36	16	2	20	8,416	2
Other retail	3,957	35	23	—	46	4,061	1
Total retail	67,675	318	134	144	609	68,880	377
Total	$140,248	$565	$206	$169	$1,504	$142,692	$496
Guaranteed residential mortgages(1)	$743	$53	$27	$141	$—	$964	$—

(1) Guaranteed residential mortgages represent loans fully or partially guaranteed or insured by the FHA, VA, and USDA, and are included in the amounts presented for Residential mortgages.

At March 31, 2026 and December 31, 2025, the Company had collateral-dependent residential mortgage and home equity loans totaling $458 million and $437 million, respectively, and collateral-dependent commercial loans totaling $244 million and $251 million, respectively.

The amortized cost basis of mortgage loans collateralized by residential real estate for which formal foreclosure proceedings were in-process was $313 million and $307 million as of March 31, 2026 and December 31, 2025, respectively.

Loan Modifications to Borrowers Experiencing Financial Difficulty

Loan modifications, characterized as FDMs, offered by the Company to retail and commercial borrowers experiencing financial difficulty as a result of its loss mitigation activities may result in a payment delay, interest rate reduction, term extension, principal forgiveness, or combination thereof. Payment delays consist of modifications that result in a delay of contractual amounts due greater than three months over a rolling 12-month period. Term extensions consist of modifications that result in an extension of the contractual maturity date greater than three months or a significant deferral of principal payments relative to the total outstanding principal balance of the loan.

Citizens Financial Group, Inc. | 50

Commercial loan modifications are offered on a case-by-case basis and generally include a payment delay, term extension, and/or interest rate reduction. The Company does not typically offer principal forgiveness for commercial loans. Retail loan modifications are offered through structured loan modification programs, which are summarized below:

Forbearance programs provide borrowers experiencing some form of hardship a period of time during which their contractual payment obligations are suspended, resulting in a payment delay and/or term extension;
Other repayment plans are offered due to hardship and include an interest rate reduction and/or term extension designed to enable the borrower to return the loan to current status in an expeditious manner;
Settlement agreements may be executed with borrowers experiencing a long-term hardship or who are delinquent, resulting in principal forgiveness. Upon fulfillment of the terms of the settlement agreement, the unpaid principal amount is forgiven resulting in a charge-off of the outstanding principal balance; and
Certain reorganization bankruptcy judgments may result in any one of the four modification types or some combination thereof.

The following tables present the period-end amortized cost of loans to borrowers experiencing financial difficulty that were modified during the three months ended March 31, 2026 and 2025, disaggregated by class of financing receivable and modification type. The modification type reflects the cumulative effect of all FDMs received during the indicated period.


	Three Months Ended March 31, 2026
(dollars in millions)	Interest Rate Reduction	Term Extension	Payment Delay	Interest Rate Reduction and Term Extension	Term Extension and Payment Delay	Total	Total as a % of Loan Class(1)
Commercial and industrial	$1	$78	$45	$1	$21	$146	0.29	%
Commercial real estate	—	131	36	—	33	200	0.82
Total commercial	1	209	81	1	54	346	0.46
Residential mortgages	—	12	6	3	1	22	0.06
Home equity	—	—	4	4	—	8	0.04

Education	2	—	—	—	—	2	0.02
Other retail	6	—	—	—	—	6	0.15
Total retail	8	12	10	7	1	38	0.06
Total	$9	$221	$91	$8	$55	$384	0.27	%


	Three Months Ended March 31, 2025
(dollars in millions)	Interest Rate Reduction	Term Extension	Payment Delay	Interest Rate Reduction and Term Extension	Term Extension and Payment Delay	Total	Total as a % of Loan Class(1)
Commercial and industrial	$32	$141	$2	$—	$1	$176	0.40	%
Commercial real estate	10	172	73	—	25	280	1.05
Total commercial	42	313	75	—	26	456	0.65
Residential mortgages	1	15	2	4	1	23	0.07
Home equity	1	—	2	1	—	4	0.02

Education	2	—	—	—	—	2	0.02
Other retail	6	—	—	—	—	6	0.14
Total retail	10	15	4	5	1	35	0.05
Total	$52	$328	$79	$5	$27	$491	0.36	%

(1) Represents the total amortized cost as of period-end divided by the period-end amortized cost of the corresponding loan class. Accrued interest receivable is excluded from amortized cost and is immaterial.

Citizens Financial Group, Inc. | 51

The following tables present the financial effect of loans to borrowers experiencing financial difficulty that were modified during the three months ended March 31, 2026 and 2025, disaggregated by class of financing receivable:


	Three Months Ended March 31, 2026
(dollars in millions)	Weighted-Average Interest Rate Reduction(1)		Weighted-Average Term Extension (in Months)(1)	Weighted-Average Payment Deferral(1)	Amount of Principal Forgiven(2)
Commercial and industrial	2.54	%	21	$1	$—
Commercial real estate	—		12	2	—
Residential mortgages	0.80		115	—	—
Home equity	2.90		188	—	—

Education	4.40		—	—	—
Other retail	19.42		—	—	4


	Three Months Ended March 31, 2025
(dollars in millions)	Weighted-Average Interest Rate Reduction(1)		Weighted-Average Term Extension (in Months)(1)	Weighted-Average Payment Deferral(1)	Amount of Principal Forgiven(2)
Commercial and industrial	0.81	%	10	$—	$—
Commercial real estate	0.75		10	1	—
Residential mortgages	0.98		111	—	—
Home equity	4.55		74	—	—

Education	4.96		—	—	—
Other retail	20.30		—	—	2

(1) Weighted based on period-end amortized cost.

(2) Amounts are recorded as charge-offs.

The following tables present an aging analysis of the period-end amortized cost of loans to borrowers experiencing financial difficulty that were modified during the twelve-month periods ended March 31, 2026 and 2025, disaggregated by class of financing receivable. A loan in a forbearance or repayment plan is reported as past due according to its contractual terms until contractually modified. Subsequent to modification, it is reported as past due based on its restructured terms.


	March 31, 2026
		Days Past Due and Accruing
(dollars in millions)	Current	30-59	60-89	90+	Nonaccrual	Total
Commercial and industrial	$402	$80	$—	$—	$26	$508
Commercial real estate	763	94	51	20	231	1,159
Total commercial	1,165	174	51	20	257	1,667
Residential mortgages	41	4	4	34	22	105
Home equity	8	—	—	—	28	36

Education	10	—	—	—	1	11
Other retail	14	2	1	—	1	18
Total retail	73	6	5	34	52	170
Total	$1,238	$180	$56	$54	$309	$1,837


	March 31, 2025
		Days Past Due and Accruing
(dollars in millions)	Current	30-59	60-89	90+	Nonaccrual	Total
Commercial and industrial	$311	$17	$—	$3	$51	$382
Commercial real estate	380	33	—	—	385	798
Total commercial	691	50	—	3	436	1,180
Residential mortgages	51	4	3	17	19	94
Home equity	9	—	1	—	12	22

Education	8	—	—	—	1	9
Other retail	13	2	1	—	1	17
Total retail	81	6	5	17	33	142
Total	$772	$56	$5	$20	$469	$1,322

Citizens Financial Group, Inc. | 52

The following tables present the period-end amortized cost of loans to borrowers experiencing financial difficulty that defaulted during the period presented and were modified within the previous 12 months preceding the default, disaggregated by class of financing receivable and modification type. The modification type reflects the cumulative effect of all FDMs at the time of default. A loan is considered to be in default if, subsequent to modification, it becomes 90 or more days past due or is placed on nonaccrual status.


	Three Months Ended March 31, 2026
(dollars in millions)	Interest Rate Reduction	Term Extension	Payment Delay	Interest Rate Reduction and Term Extension	Term Extension and Payment Delay	Interest Rate Reduction, Term Extension, and Payment Delay	Total
Commercial and industrial	$—	$—	$—	$—	$—	$—	$—
Commercial real estate	—	69	—	—	—	—	69
Total commercial	—	69	—	—	—	—	69
Residential mortgages	—	8	1	3	1	1	14
Home equity	—	—	—	—	—	—	—

Education	—	—	—	—	—	—	—
Other retail	1	—	—	—	—	—	1
Total retail	1	8	1	3	1	1	15
Total	$1	$77	$1	$3	$1	$1	$84


	Three Months Ended March 31, 2025
(dollars in millions)	Interest Rate Reduction	Term Extension	Payment Delay	Interest Rate Reduction and Term Extension	Total
Commercial and industrial	$—	$—	$—	$—	$—
Commercial real estate	—	71	—	—	71
Total commercial	—	71	—	—	71
Residential mortgages	—	5	1	2	8
Home equity	1	—	—	1	2

Education	—	—	—	—	—
Other retail	1	—	—	—	1
Total retail	2	5	1	3	11
Total	$2	$76	$1	$3	$82

Unfunded commitments related to loans modified during the three months ended March 31, 2026 were $19 million at March 31, 2026. Unfunded commitments related to loans modified during the year ended December 31, 2025 were $465 million at December 31, 2025.

NOTE 5 - MORTGAGE BANKING AND OTHER SERVICED LOANS

Mortgage Banking

The Company sells residential mortgages in the secondary market and does not retain a beneficial interest in these sales but may retain the servicing rights for the loans sold. The Company may exercise its option to repurchase eligible government guaranteed residential mortgages or may be obligated to subsequently repurchase a loan if the purchaser discovers a representation or warranty violation, such as noncompliance with eligibility or servicing requirements or customer fraud that should have been identified in a loan file review.

Citizens Financial Group, Inc. | 53

The following table summarizes activity related to residential mortgage loans sold with servicing rights retained:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Cash proceeds from residential mortgage loans sold with servicing retained	$2,536	$1,658

Gain on sales(1)	21	16
Contractually specified servicing, late, and other ancillary fees(1)	70	70

(1) Reported in Mortgage banking fees in the Consolidated Statements of Operations.

The unpaid principal balance of residential mortgage loans related to our MSRs was $94.8 billion and $94.9 billion at March 31, 2026 and December 31, 2025, respectively. The Company manages the risk associated with changes in the fair value of the MSRs with an active economic hedging strategy, which includes the purchase of freestanding derivatives.

The following table summarizes changes in MSRs recorded using the fair value method:


	As of and for the Three Months Ended March 31,
(dollars in millions)		2026	2025
Fair value as of beginning of the period		$1,455	$1,491


Amounts capitalized		48	27

Sales(1)		—	(72)
Changes in unpaid principal balance(2)		(46)	(39)
Changes in fair value(3)		5	(10)
Fair value at end of the period		$1,462	$1,397

(1) For the three months ended March 31, 2025, represents the sale of the excess servicing yield on MSRs related to certain FNMA mortgages with a total unpaid principal balance of $10.5 billion at the time of sale.

(2) Represents changes in value of the MSRs due to i) the passage of time including the impact from both regularly scheduled loan principal payments and partial

paydowns, and ii) loans that paid off during the period.

(3) Represents changes in fair value primarily driven by market conditions. These changes are recorded in Mortgage banking fees in the Consolidated Statements of Operations.

The fair value of MSRs is estimated by using the present value of estimated future net servicing cash flows, taking into consideration actual and expected mortgage loan prepayment rates, discount rates, contractual servicing fee income, servicing costs, default rates, ancillary income, and other economic factors determined based on current market interest rates. The valuation does not attempt to forecast or predict the future direction of interest rates.

The sensitivity analysis below presents the impact of an immediate 10% and 20% adverse change in key economic assumptions to the current fair value of MSRs. These sensitivities are hypothetical, with the effect of a variation in a particular assumption on the fair value of the MSRs calculated independently without changing any other assumption. Changes in one factor may result in changes in another (e.g., changes in interest rates that drive changes in prepayment rates could result in changes in discount rates) and may amplify or counteract the sensitivities. The primary risk inherent in the Company’s MSRs is an increase in prepayments of the underlying mortgage loans serviced, which is largely dependent upon movements in market interest rates.


(dollars in millions)	March 31, 2026	December 31, 2025
Fair value	$1,462	$1,455
Weighted average life (years)	8.1	8.0
Weighted average constant prepayment rate	6.9%	7.0%
Decline in fair value from 10% adverse change	$38	$38
Decline in fair value from 20% adverse change	$73	$73
Weighted average option adjusted spread	574 bps	588 bps
Decline in fair value from 10% adverse change	$39	$40
Decline in fair value from 20% adverse change	$77	$80

The Company has mortgage banking derivatives that include commitments to originate mortgages held for sale, certain loan sale agreements, and other financial instruments that meet the definition of a derivative. Refer to Note 8 for additional information.

Citizens Financial Group, Inc. | 54

Other Serviced Loans

The Company engages in other servicing relationships from time to time. The following table presents the unpaid principal balance of other serviced loans:


(dollars in millions)	March 31, 2026	December 31, 2025
Education	$319	$341
Commercial and industrial(1)	80	84

(1) Represents the government guaranteed portion of SBA loans sold to outside investors.

NOTE 6 - VARIABLE INTEREST ENTITIES

The Company, in the normal course of business, engages in a variety of activities with entities that are considered VIEs, as defined by GAAP, with its variable interest arising from contractual, ownership, or other monetary interests in the entity. A VIE typically does not have sufficient equity at risk to finance its activities without additional subordinated financial support from other parties.

For more details regarding the Company’s involvement with VIEs see Note 9 in the Company’s 2025 Form 10-K.

Consolidated VIEs

The Company has consolidated VIEs related to secured borrowings collateralized by auto loans. The following table summarizes the carrying amount of assets and liabilities for the Company’s consolidated VIEs:


(dollars in millions)	March 31, 2026	December 31, 2025
Assets:

Interest-bearing deposits in banks	$148	$157
Net loans and leases	1,556	1,929
Other assets	11	11
Total assets	$1,715	$2,097
Liabilities:
Long-term borrowed funds	$1,252	$1,598
Other liabilities	3	4
Total liabilities	$1,255	$1,602

Secured Borrowings

The Company utilizes a portion of its auto loan portfolio to support certain secured borrowing arrangements, which provide a source of funding for the Company and involves the transfer of auto loans to bankruptcy remote SPEs. These SPEs then issue asset-backed notes to third parties collateralized by the transferred loans.

The assets of a particular VIE are the primary source of funds to settle its obligations. Creditors of these VIEs do not have recourse to the general credit of the Company. The performance of the loans transferred is the most significant driver impacting the economic performance of the VIEs.

Citizens Financial Group, Inc. | 55

Unconsolidated VIEs

The Company is involved with various VIEs that are not consolidated including lending to SPEs, investments in asset-backed securities, and investments in entities that sponsor affordable housing and renewable energy projects. The Company’s maximum exposure to loss resulting from its involvement with these entities is limited to the balance sheet carrying amount of its investments, unfunded commitments, and the outstanding principal balance of loans to SPEs.

The following table provides a summary of the assets and liabilities included in the Consolidated Balance Sheets related to unconsolidated VIEs that the Company holds an interest in, but is not the primary beneficiary of:


(dollars in millions)	March 31, 2026	December 31, 2025
Lending to SPEs included in Loans and leases	$5,880	$5,631
Tax-advantaged investments included in Other assets(1)	3,005	2,967
Unfunded commitments for tax-advantaged investments included in Other liabilities(1)	1,079	1,066
Asset-backed investments included in Debt securities	1,067	1,118
Other investments included in Other assets	17	17
Unfunded commitments for other investments included in Other liabilities	2	2

(1) Includes LIHTC and renewable energy investments.

Lending to Special Purpose Entities

The Company provides lending facilities to third-party sponsored SPEs within its Capital Markets business. The SPEs are primarily funded through these lending facilities or a syndication in which the Company participates. The principal risk of these lending facilities is the credit risk related to the underlying assets in the SPE, in which the Company generally holds a priority position. As of March 31, 2026 and December 31, 2025, the lending facilities had undrawn commitments to extend credit of $4.3 billion and $4.0 billion, respectively. For more information on commitments to extend credit see Note 11.

Tax-Advantaged Investments

Low Income Housing Tax Credit Partnerships

The Company makes certain equity investments in various limited partnerships that sponsor affordable housing projects utilizing federal tax incentives pursuant to Section 42 of the Internal Revenue Code. The objective of these investments is to generate a satisfactory return on capital, encourage investment in projects that serve affordable housing product offerings, and further the goals of the Community Reinvestment Act. The principal activities of the limited partnerships include the identification, development, and operation of multifamily housing properties leased to qualifying residential tenants. Funding for these investments is generally provided through a combination of debt and equity.

The Company’s investments in LIHTC partnerships totaled $2.8 billion as of March 31, 2026 and December 31, 2025, with unfunded commitments related to these investments totaling $1.0 billion and $1.1 billion, respectively.

Renewable Energy Entities

The Company’s investments in certain renewable energy entities provide benefits from government incentives and other tax attributes (e.g., tax depreciation). The Company’s investments in renewable energy entities totaled $241 million and $201 million, respectively, as of March 31, 2026 and December 31, 2025, with unfunded commitments related to these investments totaling $55 million as of March 31, 2026. Unfunded commitments are contingent upon the level of electricity production attained by the renewable energy entity relative to its targeted threshold, changes in the production tax credit rates set by the Internal Revenue Service, and the achievement of commercial operation for a certain renewable energy project under its power purchase agreement.

Citizens Financial Group, Inc. | 56

Asset-backed securities

The Company’s investments in asset-backed securities are collateralized by education and residential mortgage loans sold to third-party sponsored VIEs. The Company acts as the primary servicer for the sold education loans and receives a servicing fee, with a third-party servicer responsible for all loans that become significantly delinquent. With respect to sold residential mortgage loans, the Company initially purchases these loans from third parties as part of its mortgage banking activities and then subsequently sells them to FNMA or FHLMC in exchange for mortgage-backed securities issued by securitization SPEs that they sponsor. The securitizations are structured without recourse to the Company except for standard representations and warranties and with no restrictions on the retained interests. The Company does not retain servicing for the sold residential mortgage loans.

The Company did not retain any securitization interests resulting from the origination of residential mortgage loans during the three months ended March 31, 2026 and 2025.

Other Investments

The Company makes certain equity investments in various tax credit limited partnerships or limited liability companies in order to achieve a satisfactory return on capital and to assist the Company in achieving goals associated with the CRA.

The following table summarizes the impact to the Consolidated Statements of Operations relative to the Company’s tax credit programs for which it has elected to apply the proportional amortization method of accounting:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Tax credits recognized	$110	$106
Other tax benefits recognized	25	23
Amortization	(107)	(102)
Net benefit (expense) included in Income tax expense	28	27
Other income	—	2
Allocated income (loss) on investments	(4)	(3)
Net benefit (expense) included in Noninterest income	(4)	(1)
Net benefit (expense) included in the Consolidated Statements of Operations(1)	$24	$26

(1) Includes the impact of tax credit investments when the election to apply the proportional amortization method was in effect during the periods presented.

The Company did not recognize impairment losses resulting from the forfeiture or ineligibility of income tax credits or other circumstances during the three months ended March 31, 2026 and 2025.

NOTE 7 - BORROWED FUNDS

Short-term borrowed funds

Borrowings with original maturities of one year or less are classified as short-term and were comprised of the following:


(dollars in millions)	March 31, 2026	December 31, 2025


Other short-term borrowed funds(1)	$54	$58
Total short-term borrowed funds	$54	$58

(1) Consists primarily of short positions held by the Company’s commercial broker dealer. See Note 8 for additional information regarding forward purchase contracts entered into to economically hedge these short positions.

Citizens Financial Group, Inc. | 57

Long-term borrowed funds

The following table presents a summary of the Company’s long-term borrowed funds:


(dollars in millions)	March 31, 2026	December 31, 2025
Parent Company:
2.850% fixed-rate senior unsecured notes, due July 2026	$500	$500
5.841% fixed/floating-rate senior unsecured notes, due January 2030	1,246	1,246
2.500% fixed-rate senior unsecured notes, due February 2030	299	299
3.250% fixed-rate senior unsecured notes, due April 2030	748	747
3.750% fixed-rate reset subordinated debt, due February 2031(1)	—	69
4.300% fixed-rate reset subordinated debt, due February 2031(1)	—	135
4.350% fixed-rate reset subordinated debt, due February 2031(1)	—	60
5.253% fixed/floating-rate senior unsecured notes, due March 2031	747	747
5.718% fixed/floating-rate senior unsecured notes, due July 2032	1,244	1,244
2.638% fixed-rate subordinated debt, due September 2032	578	577
6.645% fixed/floating-rate senior unsecured notes, due April 2035	746	746
5.299% fixed-reset subordinated notes, due January 2036	397	—
5.641% fixed-rate reset subordinated debt, due May 2037	399	398
CBNA’s Global Note Program:
4.575% fixed/floating-rate senior unsecured notes, due August 2028	799	799
4.192% fixed/floating-rate senior unsecured notes, due January 2029	747	—
Additional Borrowings by CBNA and Other Subsidiaries:
Federal Home Loan Bank advances, 3.951% weighted average rate, due through 2045(2)	2,513	2,013
Secured borrowings, 5.548% weighted average rate, due through 2031(2)(3)	1,279	1,625
Other	18	19
Total long-term borrowed funds	$12,260	$11,224

(1) Notes were redeemed in February 2026.

(2) Rate disclosed reflects the weighted average rate as of March 31, 2026.

(3) Collateralized by loans. See Note 6 for additional information.

At March 31, 2026, the Company’s long-term borrowed funds include principal balances of $12.3 billion and unamortized debt issuance costs and discounts of $70 million. At December 31, 2025, the Company’s long-term borrowed funds include principal balances of $11.3 billion and unamortized debt issuance costs and discounts of $71 million.

Advances, lines of credit, and letters of credit from the FHLB are collateralized primarily by residential mortgages and home equity products sufficient to satisfy the collateral maintenance level established by the FHLB. The utilized FHLB borrowing capacity, primarily for advances and letters of credit, was $7.3 billion and $7.1 billion at March 31, 2026 and December 31, 2025, respectively. The Company’s available FHLB borrowing capacity was $23.2 billion and $22.1 billion at March 31, 2026 and December 31, 2025, respectively. The Company can also borrow from the FRB discount window to meet short-term liquidity requirements. Collateral, including certain loans, is pledged to support this borrowing capacity. At March 31, 2026, the Company’s unused secured borrowing capacity was approximately $80.7 billion, which includes unencumbered securities, FHLB borrowing capacity, and FRB discount window capacity.

NOTE 8 - DERIVATIVES

In the normal course of business, the Company enters into derivative transactions to meet the financing and hedging needs of its customers and reduce its own exposure to fluctuations in interest rates and foreign currency exchange rates. These transactions include interest rate swap contracts, interest rate options, foreign exchange contracts, residential loan commitment rate locks, interest rate future contracts, swaptions, certain commodities, forward commitments to sell TBAs, forward purchase and sale contracts, and purchase options. The Company does not use derivatives for speculative purposes. Information regarding the valuation methodology and inputs used to estimate the fair value of the Company’s derivative instruments is described in Note 18 in the Company’s 2025 Form 10-K.

Citizens Financial Group, Inc. | 58

The following table presents derivative assets and liabilities included in the Consolidated Balance Sheets:


	March 31, 2026			December 31, 2025
(dollars in millions)	Notional Amount	Derivative Assets	Derivative Liabilities	Notional Amount	Derivative Assets	Derivative Liabilities
Derivatives designated as hedging instruments:
Interest rate contracts	$65,576	$274	$12	$67,358	$366	$25
Derivatives not designated as hedging instruments:
Interest rate contracts	183,611	137	456	180,977	187	446
Foreign exchange contracts	36,697	528	366	40,401	510	373
Commodities contracts	14,085	717	661	10,974	458	405
TBA contracts	7,147	29	20	3,043	2	6
Other contracts	1,059	7	4	968	9	3
Total derivatives not designated as hedging instruments	242,599	1,418	1,507	236,363	1,166	1,233
Total gross derivatives	308,175	1,692	1,519	303,721	1,532	1,258
Less: Gross amounts offset in the Consolidated Balance Sheets(1)		(498)	(498)		(342)	(342)
Less: Cash collateral applied(1)		(389)	(207)		(494)	(137)
Total net derivatives presented in the Consolidated Balance Sheets		$805	$814		$696	$779

(1) Amounts represent the impact of enforceable master netting agreements that allow the Company to net settle positive and negative positions, as well as collateral paid and received.

The Company’s derivative transactions are internally divided into three sub-groups: institutional, customer facilitation, and residential loan. Certain derivative transactions within these sub-groups are designated as fair value or cash flow hedges, as described below:

Derivatives Designated As Hedging Instruments

The Company’s institutional derivatives qualify for hedge accounting treatment. The net interest accruals on interest rate swaps designated in a fair value or cash flow hedge relationship are treated as an adjustment to interest income or interest expense of the item being hedged. All hedging relationships are formally documented at inception, as well as risk management objectives and strategies for undertaking various accounting hedges. In addition, the effectiveness of hedge relationships is monitored during the duration of the hedge period. The methods utilized to assess hedge effectiveness vary based on the hedge relationship, with each relationship monitored to ensure that management’s initial intent continues to be satisfied. Hedge accounting treatment is discontinued when the derivative is terminated or when it is determined that a derivative is not expected to be, or has ceased to be, an effective hedge. Changes in the fair value of a derivative are reflected in earnings after termination of the hedge relationship.

Fair Value Hedges

In a fair value hedge, changes in the fair value of both the derivative instrument and the hedged asset or liability attributable to the risk being hedged are recognized in the same income statement line item in the Consolidated Statements of Operations when the changes in fair value occur. At March 31, 2026 and December 31, 2025, the Company has designated $3.8 billion of interest rate swaps as fair value hedges of its fixed-rate prepayable AFS securities using the portfolio layer method. This approach allows the Company to designate as the hedged item a stated amount of the assets that are not expected to be affected by prepayments, defaults, and other factors affecting the timing and amount of cash flows. At March 31, 2026 and December 31, 2025, the Company has also designated $2.0 billion and $2.8 billion, respectively, of interest rate swaps as fair value hedges to manage interest rate risk within its nonprepayable fixed-rate AFS securities portfolio.

Citizens Financial Group, Inc. | 59

The following table presents the effect of fair value hedges on the Consolidated Statements of Operations and the respective line items affected for each hedged item:


	Location and Amount of Gains (Losses) Recognized
	Interest Income	Interest Expense
(dollars in millions)	Investment Securities	Long-Term Borrowed Funds
Three Months Ended March 31, 2026
Gains (losses) on fair value hedges recognized on:
Hedged items	($39)	$—
Derivatives	39	—
Amounts related to interest settlements on derivatives	—	—
Total net interest income recognized on fair value hedges	$—	$—
Three Months Ended March 31, 2025
Gains (losses) on fair value hedges recognized on:
Hedged items	$116	($2)
Derivatives	(118)	2
Amounts related to interest settlements on derivatives	11	(2)
Total net interest income recognized on fair value hedges	$9	($2)

The following table reflects amounts recorded in the Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges:


	March 31, 2026	December 31, 2025
(dollars in millions)	Debt securities available for sale(1)		Debt securities available for sale(1)
Carrying amount of hedged assets(2)	$7,050		$8,009

Cumulative amount of fair value hedging adjustments included in the carrying amount of the hedged items	8		48

(1) Includes the amortized cost basis of closed portfolios used to designate hedging relationships under the portfolio layer method. The hedged item is a layer of the closed portfolio which is expected to be remaining at the end of the hedging relationship. As of March 31, 2026 and December 31, 2025, the amortized cost basis of the closed portfolios used in these hedging relationships was $4.9 billion and $5.1 billion, respectively, including associated cumulative basis adjustments of $(4) million and $17 million, respectively. The amount of the designated hedging instruments was $3.8 billion at March 31, 2026 and December 31, 2025.

(2) Carrying amount represents amortized cost.

Cash Flow Hedges

In a cash flow hedge the entire change in the fair value of the interest rate swap included in the assessment of hedge effectiveness is initially recorded in OCI and is subsequently reclassified from AOCI into earnings in the period during which the hedged item affects earnings.

The Company enters into interest rate swap agreements designed primarily to hedge a portion of its floating-rate assets and liabilities. All of these swaps are deemed highly effective cash flow hedges. From time to time, the Company may also enter into certain interest rate option agreements that utilize interest rate floors and/or caps. Option premiums paid and received are excluded from the assessment of hedge effectiveness and are amortized over the life of the instruments.

The following table presents the pre-tax net gains (losses) recorded in the Consolidated Statements of Operations and in the Consolidated Statements of Comprehensive Income related to derivative instruments designated as cash flow hedges:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Pre-tax net gains (losses) recognized in OCI	($169)	$284
Pre-tax net gains (losses) reclassified from AOCI into interest income	(113)	(202)

Citizens Financial Group, Inc. | 60

Using the March 31, 2026 interest rate curve, the Company estimates that $188 million in pre-tax net losses related to cash flow hedge strategies will be reclassified from AOCI to earnings over the next 12 months. These losses could differ from amounts recognized due to changes in interest rates, hedge de-designations, or the addition of other hedges after March 31, 2026.

Derivatives Not Designated As Hedging Instruments

The Company offers derivatives to customers in connection with their risk management needs consisting primarily of interest rate, foreign exchange, and commodity contracts. Market risk exposure from customer transactions is primarily managed by entering into a variety of hedging transactions with third-party dealers. Gains and losses on customer-related derivatives are reported in Foreign exchange and derivatives products in the Consolidated Statements of Operations.

The Company also offers at-the-market equity programs to facilitate capital market activities for customers. These programs involve the concurrent short sale of an equity security and the execution of a forward purchase contract for the same equity security. The forward purchase contract economically hedges the Company’s short sale position and will be closed against such position when a program concludes. Changes in fair value related to the forward purchase contracts are reported in Capital markets fees in the Consolidated Statements of Operations.

Residential mortgage loans that will be sold in the secondary market and the related loan commitments, which are considered derivatives, are accounted for at fair value. Forward contracts to sell mortgage-backed securities are utilized to hedge the fair value of the loans and related commitments. Gains and losses on the loans and related commitments, and the derivatives used to economically hedge them, are reported in Mortgage banking fees in the Consolidated Statements of Operations.

Residential MSRs are accounted for at fair value. Derivatives utilized to hedge the fair value of residential MSRs include interest rate futures, swaps, options, and forward contracts to purchase mortgage-backed securities. Gains and losses on residential MSRs and the related derivatives are reported in Mortgage banking fees in the Consolidated Statements of Operations.

The following table presents the effect of economic hedges on noninterest income:


	Amounts Recognized in Noninterest Income for the
	Three Months Ended March 31,		Affected Line Item in the Consolidated Statements of Operations
(dollars in millions)	2026	2025
Economic hedge type:
Customer interest rate contracts	($117)	$165		Foreign exchange and derivative products
Derivatives hedging interest rate risk	126	(157)		Foreign exchange and derivative products
Customer foreign exchange contracts	(88)	98		Foreign exchange and derivative products
Derivatives hedging foreign exchange risk	118	(131)		Foreign exchange and derivative products
Customer commodity contracts	309	343		Foreign exchange and derivative products
Derivatives hedging commodity price risk	(300)	(336)		Foreign exchange and derivative products
Residential loan commitments	(11)	6		Mortgage banking fees
Derivatives hedging residential loan commitments and mortgage loans held for sale, at fair value	19	(13)		Mortgage banking fees
Derivative contracts used to hedge residential MSRs	(8)	22		Mortgage banking fees
Derivative contracts used to hedge equity price risk	1	—		Capital markets fees
Total	$49	($3)

Citizens Financial Group, Inc. | 61

NOTE 9 - ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following table summarizes the components of the Company’s OCI:


(dollars in millions)	Pre-tax	Tax Effect	After-tax
Three Months Ended March 31, 2026
Net unrealized gains (losses) on cash flow hedges arising during the period	($169)	$45	($124)
Reclassification of net (gains) losses on cash flow hedges to earnings	113	(30)	83
Net unrealized gains (losses) on cash flow hedges	(56)	15	(41)
Net unrealized gains (losses) on AFS securities arising during the period	(133)	33	(100)
Reclassification of net (gains) losses on investment securities to earnings	25	(6)	19
Net unrealized gains (losses) on investment securities	(108)	27	(81)
Net actuarial gain (loss) arising during the period	—	—	—
Amortization of actuarial (gain) loss to earnings	5	(1)	4
Defined benefit plans	5	(1)	4
Total other comprehensive income (loss)	($159)	$41	($118)
Three Months Ended March 31, 2025
Net unrealized gains (losses) on cash flow hedges arising during the period	$284	($76)	$208
Reclassification of net (gains) losses on cash flow hedges to earnings	202	(54)	148
Net unrealized gains (losses) on cash flow hedges	486	(130)	356
Net unrealized gains (losses) on AFS securities arising during the period	377	(95)	282
Reclassification of net (gains) losses on investment securities to earnings	17	(4)	13
Net unrealized gains (losses) on investment securities	394	(99)	295
Net actuarial gain (loss) arising during the period	—	—	—
Amortization of actuarial (gain) loss to earnings	4	(1)	3
Defined benefit plans	4	(1)	3
Total other comprehensive income (loss)	$884	($230)	$654

The following table summarizes the activity in each component of AOCI, net of income taxes:


(dollars in millions)	Net Unrealized Gains (Losses) on Cash Flow Hedges	Net Unrealized Gains (Losses) on Investment Securities	Defined Benefit Plans	Total AOCI
Three Months Ended March 31, 2026
Balance at January 1, 2026	($118)	($1,603)	($249)	($1,970)
Other comprehensive income (loss) before reclassifications	(124)	(100)	—	(224)
Amounts reclassified from AOCI to earnings	83	19	4	106
Total other comprehensive income (loss)	(41)	(81)	4	(118)
Balance at March 31, 2026	($159)	($1,684)	($245)	($2,088)
Three Months Ended March 31, 2025
Balance at January 1, 2025	($925)	($2,369)	($301)	($3,595)
Other comprehensive income (loss) before reclassifications	208	282	—	490
Amounts reclassified from AOCI to earnings	148	13	3	164
Total other comprehensive income (loss)	356	295	3	654
Balance at March 31, 2025	($569)	($2,074)	($298)	($2,941)















Primary location in the Consolidated Statements of Operations of amounts reclassified from AOCI	Net interest income	Securities gains, net and Net interest income	Other operating expense

Citizens Financial Group, Inc. | 62

NOTE 10 - STOCKHOLDERS’ EQUITY

Preferred Stock

The following table summarizes the Company’s preferred stock:


			March 31, 2026			December 31, 2025
(dollars in millions, except per share data)	Liquidation value per share		Preferred Shares		Carrying Amount	Preferred Shares	Carrying Amount
Authorized ($25 par value per share)			100,000,000			100,000,000
Issued and outstanding:
Series B	$1,000		300,000		$296	300,000	$296
Series C	1,000		300,000		297	300,000	297
Series E	1,000	(1)	450,000	(2)	437	450,000	437
Series G	1,000		300,000		296	300,000	296
Series H	1,000	(1)	400,000	(3)	392	400,000	392
Series I	1,000	(1)	400,000	(4)	393	400,000	393
Total			2,150,000		$2,111	2,150,000	$2,111

(1) Equivalent to $25 per depositary share.

(2) Represented by 18,000,000 depositary shares each representing a 1/40th interest in the Series E Preferred Stock.

(3) Represented by 16,000,000 depositary shares each representing a 1/40th interest in the Series H Preferred Stock.

(4) Represented by 16,000,000 depositary shares each representing a 1/40th interest in the Series I Preferred Stock.

For further detail regarding the terms and conditions of the Company’s preferred stock, see Note 15 in the Company’s 2025 Form 10-K.

Dividends

The following tables summarize the Company’s common and preferred stock dividend activity:


	Three Months Ended March 31, 2026			Three Months Ended March 31, 2025
(dollars in millions, except per share data)	Dividends Declared per Share	Dividends Declared	Dividends Paid	Dividends Declared per Share	Dividends Declared	Dividends Paid
Common stock	$0.46	$198	$198	$0.42	$186	$186
Preferred stock
Series B	$17.29	$5	$5	$19.11	$6	$6
Series C	17.67	5	6	19.50	6	6
Series E	12.50	6	6	12.50	5	6
Series F	—	—	—	14.13	6	6
Series G	10.00	3	3	10.00	3	3
Series H	18.44	7	7	18.44	7	7
Series I	16.25	7	11	—	—	—
Total preferred stock		$33	$38		$33	$34

Treasury Stock

During the three months ended March 31, 2026 and 2025, the Company repurchased $300 million, or 4,807,769 shares, and $200 million, or 4,483,894 shares, respectively, of its outstanding common stock, which are held in treasury stock.

Citizens Financial Group, Inc. | 63

NOTE 11 - COMMITMENTS AND CONTINGENCIES

A summary of outstanding off-balance sheet arrangements is presented below. For more information on these arrangements, see Note 17 in the Company’s 2025 Form 10-K.


(dollars in millions)	March 31, 2026	December 31, 2025
Commitments to extend credit	$107,356	$105,880
Letters of credit	2,741	1,902
Loans sold with recourse	81	85
Risk participation agreements	21	37
Other commitments	9	11
Total	$110,208	$107,915

Commitments to Extend Credit

Commitments to extend credit are agreements to lend to customers in accordance with conditions contractually agreed upon in advance. These commitments generally have fixed expiration dates or termination clauses and may require payment of a fee. Since many of these commitments are expected to expire without being drawn upon, the contract amounts are not necessarily indicative of future cash requirements.

Letters of Credit

Letters of credit in the table above reflect commercial, standby financial, and standby performance letters of credit. Financial and performance standby letters of credit are issued by the Company for the benefit of its customers. They are used as conditional guarantees of payment to a third party in the event the customer either fails to make specific payments (financial) or fails to complete a specific project or activity (performance). The Company’s exposure to credit loss in the event of counterparty nonperformance in connection with the above instruments is represented by the contractual amount of those instruments. Letters of credit are generally secured according to the creditworthiness of the counterparty, with collateral including, but not limited to, cash, accounts receivable, inventory, or investment securities. Credit risk associated with letters of credit is considered in determining the appropriate amount of the allowance for unfunded commitments. Standby and commercial letters of credit are issued for terms of no more than two years and one year, respectively.

Loans Sold with Recourse

The Company is an originator and servicer of residential mortgages and routinely sells such mortgage loans in the secondary market and to GSEs. In the context of such sales, the Company makes certain representations and warranties regarding the characteristics of the underlying loans and, as a result, may be contractually required to repurchase such loans or indemnify certain parties against losses for certain breaches of those representations and warranties. The Company also sells the government guaranteed portion of certain SBA loans to outside investors, for which it retains the servicing rights.

Risk Participation Agreements

RPAs are guarantees issued by the Company to other parties for a fee, whereby the Company agrees to participate in the credit risk of a derivative customer of the other party. The current amount of credit exposure is spread out over multiple counterparties. At March 31, 2026, the remaining terms on these RPAs ranged from less than one year to nine years.

Contingencies

The Company operates in a legal and regulatory environment that exposes it to potentially significant risks. A certain amount of litigation ordinarily results from the nature of the Company’s banking and other businesses. The Company is a party to legal proceedings, including class actions. The Company is also the subject of investigations, reviews, subpoenas, and regulatory matters arising out of its normal business operations which, in some instances, relate to concerns about fair lending, unfair and/or deceptive practices, and mortgage-related issues. In addition, the Company engages in discussions with relevant governmental and regulatory authorities on a regular and ongoing basis regarding various issues, and any issues discussed or identified may result in investigatory or other action being taken. Litigation and regulatory matters may result in settlements, damages, fines, penalties, public or private censure, increased costs, required remediation, restrictions on business activities, or other impacts on the Company.

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In these disputes and proceedings, the Company contests liability and the amount of damages as appropriate. Given their complex nature, and based on the Company's experience, it may be years before some of these matters are resolved. Moreover, before liability can be reasonably estimated for a claim, numerous legal and factual issues may need to be examined, including through potentially lengthy discovery and determination of important factual matters, and by addressing novel or unsettled legal issues relevant to the proceedings in question. The Company cannot predict with certainty if, how, or when such claims will be resolved or what the eventual settlement, fine, penalty, or other relief, if any, may be, particularly for claims that are at an early stage in their development or where claimants seek substantial or indeterminate damages. The Company recognizes a provision for a claim when, in the opinion of management after seeking legal advice, it is probable that a liability exists and the amount of loss can be reasonably estimated. In many proceedings, however, it is not possible to determine whether any loss is probable or to estimate the amount of any loss.

Based on information currently available, the advice of legal counsel and other advisers, and established reserves, management believes that the aggregate liabilities, if any, potentially arising from these proceedings will not have a materially adverse effect on the Company’s unaudited interim Consolidated Financial Statements.

NOTE 12 - FAIR VALUE MEASUREMENTS

The Company measures or monitors many of its assets and liabilities on a fair value basis. Fair value is used on a recurring basis for assets and liabilities for which fair value is the required or elected measurement basis of accounting. Fair value is also used on a nonrecurring basis to evaluate assets for impairment or for disclosure purposes. Nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write-downs of individual assets. Fair value measurement guidance is also applied to disclosures in this Note related to assets and liabilities that are not required to be reported at fair value in the financial statements.

For more information on the measurement of fair value for the Company’s assets and liabilities, including the election of the fair value option and valuation techniques utilized to measure fair value on a recurring and nonrecurring basis, see Note 18 in the Company’s 2025 Form 10-K.

Fair Value Option

The Company has elected to account for residential mortgage LHFS and certain commercial LHFS under the fair value option. Under the fair value option, residential mortgage LHFS and certain commercial LHFS are initially measured at fair value with subsequent changes in fair value recognized in Mortgage banking fees and Capital markets fees, respectively, in the Consolidated Statements of Operations. The following table presents the difference between the aggregate fair value and the aggregate unpaid principal balance of LHFS measured at fair value:


	March 31, 2026			December 31, 2025
(dollars in millions)	Aggregate Fair Value	Aggregate Unpaid Principal	Aggregate Fair Value Greater (Less) Than Aggregate Unpaid Principal	Aggregate Fair Value	Aggregate Unpaid Principal	Aggregate Fair Value Greater (Less) Than Aggregate Unpaid Principal
Residential mortgage loans held for sale	$778	$770	$8	$895	$872	$23
Commercial loans held for sale	139	147	(8)	170	185	(15)

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Recurring Fair Value Measurements

The Company utilizes a variety of valuation techniques to measure its assets and liabilities at fair value on a recurring basis. The following table presents assets and liabilities measured at fair value, including gross derivative assets and liabilities, on a recurring basis at March 31, 2026:


(dollars in millions)	Total	Level 1	Level 2	Level 3
Debt securities available for sale:
Mortgage-backed securities	$31,937	$—	$31,937	$—

Collateralized loan obligations	89	—	89	—
State and political subdivisions	1	—	1	—
U.S. Treasury and other	4,334	4,334	—	—
Total debt securities available for sale	36,361	4,334	32,027	—
Loans held for sale:
Residential loans held for sale	778	—	778	—
Commercial loans held for sale	139	—	139	—
Total loans held for sale, at fair value	917	—	917	—
Mortgage servicing rights	1,462	—	—	1,462
Derivative assets:
Interest rate contracts	411	—	411	—
Foreign exchange contracts	528	—	528	—
Commodities contracts	717	—	717	—
TBA contracts	29	—	29	—
Other contracts	7	—	2	5
Total derivative assets	1,692	—	1,687	5
Equity securities, at fair value(1)	269	269	—	—
Short-term investments	65	30	35	—
Total assets	$40,766	$4,633	$34,666	$1,467
Derivative liabilities:
Interest rate contracts	$468	$—	$468	$—
Foreign exchange contracts	366	—	366	—
Commodities contracts	661	—	661	—
TBA contracts	20	—	20	—
Other contracts	4	—	—	4
Total derivative liabilities	1,519	—	1,515	4
Short-term borrowed funds	54	40	14	—
Other liabilities	113	—	113	—
Total liabilities	$1,686	$40	$1,642	$4

(1) Excludes investments of $67 million included in Other assets in the Consolidated Balance Sheets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient. These investments include capital contributions to private investment funds and have unfunded capital commitments of $14 million at March 31, 2026, which may be called at any time during prescribed time periods. The credit exposure is generally limited to the carrying amount of investments made and unfunded capital commitments.

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The following table presents assets and liabilities measured at fair value, including gross derivative assets and liabilities, on a recurring basis at December 31, 2025:


(dollars in millions)	Total	Level 1	Level 2	Level 3
Debt securities available for sale:
Mortgage-backed securities	$32,484	$—	$32,484	$—
Collateralized loan obligations	89	—	89	—
State and political subdivisions	1	—	1	—
U.S. Treasury and other	3,123	3,123	—	—
Total debt securities available for sale	35,697	3,123	32,574	—
Loans held for sale:
Residential loans held for sale	895	—	895	—
Commercial loans held for sale	170	—	170	—
Total loans held for sale, at fair value	1,065	—	1,065	—
Mortgage servicing rights	1,455	—	—	1,455
Derivative assets:
Interest rate contracts	553	—	553	—
Foreign exchange contracts	510	—	510	—
Commodities contracts	458	—	458	—
TBA contracts	2	—	2	—
Other contracts	9	—	1	8
Total derivative assets	1,532	—	1,524	8
Equity securities, at fair value(1)	251	251	—	—
Short-term investments	72	40	32	—
Total assets	$40,072	$3,414	$35,195	$1,463
Derivative liabilities:
Interest rate contracts	$471	$—	$471	$—
Foreign exchange contracts	373	—	373	—
Commodities contracts	405	—	405	—
TBA contracts	6	—	6	—
Other contracts	3	—	—	3
Total derivative liabilities	1,258	—	1,255	3
Short-term borrowed funds	52	40	12	—
Other liabilities	157	—	157	—
Total liabilities	$1,467	$40	$1,424	$3

(1) Excludes investments of $66 million included in Other assets in the Consolidated Balance Sheets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient. These investments include capital contributions to private investment funds and have unfunded capital commitments of $14 million at December 31, 2025, which may be called at any time during prescribed time periods. The credit exposure is generally limited to the carrying amount of investments made and unfunded capital commitments.

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The following tables present a roll forward of the balance sheet amounts for assets and liabilities measured at fair value on a recurring basis and classified as Level 3:


	Three Months Ended March 31, 2026
(dollars in millions)		Mortgage Servicing Rights	Other Derivative Contracts
Beginning balance		$1,455	$5
Issuances		48	17


Settlements(2)		(46)	(9)
Changes in fair value recognized in earnings(3)		5	(12)
Ending balance		$1,462	$1


	Three Months Ended March 31, 2025
(dollars in millions)	Mortgage Servicing Rights	Other Derivative Contracts
Beginning balance	$1,491	$1



Issuances	27	16

Sales(1)	(72)	—
Settlements(2)	(39)	(16)
Changes in fair value recognized in earnings(3)	(10)	4
Ending balance	$1,397	$5

(1) For MSRs, represents the sale of the excess servicing yield on MSRs.

(2) For MSRs, represents changes in value of the MSRs due to i) the passage of time including the impact from both regularly scheduled loan principal payments and partial paydowns, and ii) loans that paid off during the period. For other derivative contracts, represents the closeout of interest rate lock commitments and other cash payments.

(3) Represents changes in fair value primarily driven by market conditions. These changes are recorded in Mortgage banking fees and Other income in the Consolidated Statements of Operations.

The following table presents quantitative information about significant unobservable inputs utilized to measure the fair value of Level 3 assets and liabilities:


			March 31, 2026	December 31, 2025
Financial Instrument(1)	Valuation Technique	Unobservable Input	Range (Weighted Average)	Range (Weighted Average)
Mortgage servicing rights	Discounted Cash Flow	Constant prepayment rate	5-15% CPR (7% CPR)	6-15% CPR (7% CPR)
Option adjusted spread	398-1,038 bps (574 bps)		398-1,038 bps (588 bps)
Other derivative contracts	Internal Model	Pull through rate	18-100% (85%)	8-100% (85%)
MSR value	34-181 bps (136 bps)		25-177 bps (134 bps)

(1) Disclosures related to the fair value measurement of financial instruments deemed immaterial are not included.

Nonrecurring Fair Value Measurements

Fair value is also used on a nonrecurring basis to evaluate certain assets for impairment or for disclosure purposes. The following table presents losses recorded in earnings on assets measured at fair value on a nonrecurring basis, regardless of whether the asset is still held at period end:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Collateral-dependent loans	($26)	($59)

The following table presents the carrying amount and fair value hierarchy of assets that were held as of the period end indicated and for which a nonrecurring fair value adjustment was recorded in earnings during the year. Carrying amount represents the fair value of the asset as of its measurement date, or date on which a nonrecurring fair value adjustment was recorded.


	March 31, 2026				December 31, 2025
(dollars in millions)	Total	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3
Collateral-dependent loans	$87	$—	$17	$70	$135	$—	$24	$111

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Fair Value of Financial Instruments

The following tables present the estimated fair value for financial instruments not recorded at fair value in the Consolidated Financial Statements. The carrying amounts are recorded in the Consolidated Balance Sheets under the indicated captions.


	March 31, 2026
	Total		Level 1		Level 2		Level 3
(dollars in millions)	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value
Financial assets(1):



Debt securities held to maturity	$7,800	$6,998	$—	$—	$7,484	$6,684	$316	$314
Loans held for sale	620	620	—	—	—	—	620	620
Net loans and leases	141,709	142,607	—	—	458	458	141,251	142,149
Other assets	836	836	—	—	788	788	48	48
Financial liabilities:
Deposits	184,035	183,980	—	—	184,035	183,980	—	—
Short-term borrowed funds	—	—	—	—	—	—	—	—
Long-term borrowed funds	12,260	12,083	—	—	12,260	12,083	—	—


	December 31, 2025
	Total		Level 1		Level 2		Level 3
(dollars in millions)	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value	Carrying Value	Estimated Fair Value
Financial assets(1):



Debt securities held to maturity	$7,933	$7,150	$—	$—	$7,595	$6,812	$338	$338
Loans held for sale	133	133	—	—	—	—	133	133
Net loans and leases	140,749	140,131	—	—	437	437	140,312	139,694
Other assets	807	807	—	—	768	768	39	39
Financial liabilities:
Deposits	183,313	183,277	—	—	183,313	183,277	—	—
Short-term borrowed funds	6	6	—	—	6	6	—	—
Long-term borrowed funds	11,224	11,472	—	—	11,224	11,472	—	—

(1) Excludes cash-related financial instruments not recorded at fair value in the Consolidated Balance Sheets with a carrying value and estimated fair value of $13.1 billion and $13.6 billion at March 31, 2026 and December 31, 2025, respectively.

NOTE 13 - NONINTEREST INCOME

A portion of the Company’s noninterest income relates to certain fee-based revenue earned from contracts with customers based on the amount of consideration expected to be received upon the transfer of control of a good or service. For a description of the components of revenue from contracts with customers and how each component is recognized for the principal products and services of the Company’s business segments, see Note 19 in the Company’s 2025 Form 10-K.

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The following tables present noninterest income segregated by revenue from contracts with customers and revenue from other sources, disaggregated by business segment. Revenue from other sources primarily includes income from letter of credit and loan fees, foreign exchange and derivative products, and mortgage banking fees.


	Three Months Ended March 31, 2026
(dollars in millions)	Consumer Banking	Commercial Banking	Other	Consolidated
Service charges and fees	$76	$35	$—	$111
Capital markets fees	—	120	—	120
Wealth fees	100	—	—	100
Card fees	65	11	4	80
Other banking fees	1	3	—	4
Total revenue from contracts with customers	$242	$169	$4	$415
Total revenue from other sources(1)	57	94	40	191
Total noninterest income	$299	$263	$44	$606


	Three Months Ended March 31, 2025
(dollars in millions)	Consumer Banking	Commercial Banking	Other	Consolidated
Service charges and fees	$74	$34	$—	$108
Capital markets fees	—	95	—	95
Wealth fees	81	—	—	81
Card fees	67	13	—	80
Other banking fees	1	2	—	3
Total revenue from contracts with customers	$223	$144	$—	$367
Total revenue from other sources(1)	74	71	32	177
Total noninterest income	$297	$215	$32	$544

(1) Includes bank-owned life insurance income of $29 million and $27 million for the three months ended March 31, 2026 and 2025, respectively.

For the three months ended March 31, 2026 and 2025, the Company recognized trailing commissions of $4 million related to previous investment sales.

NOTE 14 - OTHER OPERATING EXPENSE

The following table presents the details of Other operating expense:


	Three Months Ended March 31,
(dollars in millions)	2026	2025
Marketing	$41	$40
Deposit insurance	30	38
Other	76	79
Other operating expense	$147	$157

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NOTE 15 - EARNINGS PER SHARE

Basic EPS is the amount of earnings, adjusted for preferred stock dividends and the impact of issuance costs associated with preferred stock redemptions, available to each share of common stock outstanding during the reporting period. Diluted EPS is the amount of earnings available to each share of common stock outstanding during the reporting period adjusted to include the effect of potentially dilutive common shares, which include incremental shares issued for share-based payment awards. Potentially dilutive common shares are excluded from the computation of diluted EPS in periods in which the effect would be antidilutive.

The following table presents the calculation of basic and diluted EPS:


	Three Months Ended March 31,
(dollars in millions, except per share data)	2026	2025
Numerator (basic and diluted):
Net income	$517	$373
Less: Preferred stock dividends	33	33

Net income available to common stockholders	$484	$340
Denominator:
Weighted-average common shares outstanding - basic	425,344,491	438,320,757
Dilutive common shares: share-based awards	4,550,346	3,879,423
Weighted-average common shares outstanding - diluted	429,894,837	442,200,180
Earnings per common share:
Basic	$1.14	$0.78
Diluted(1)	1.13	0.77

(1) Excluded from the computation of diluted EPS were weighted-average antidilutive shares totaling 113,423 and 126,523 for the three months ended March 31, 2026 and 2025, respectively.

NOTE 16 - BUSINESS SEGMENTS

The Company is managed by its CODM, the Chief Executive Officer, on a segment basis. The Company’s two reportable business segments are Consumer Banking and Commercial Banking. The business segments are determined based on the products and services provided, or the type of customer served. Each business segment has a segment head that reports directly to the Chief Executive Officer, who has final authority over resource allocation decisions and performance assessment. The business segments reflect this management structure and the manner in which financial information is currently evaluated by the Chief Executive Officer.

The CODM utilizes segment pretax profit or loss as the primary measure to allocate resources to the Company’s business segments during the annual budgeting and forecasting process. This measure is also used to assess the performance of each segment, with a focus on monitoring net interest income, noninterest income, and noninterest expense. To ensure effective oversight, the CODM participates in monthly business review meetings, where budget- and forecast-to-actual variances for pretax profit or loss and its components are analyzed. These evaluations inform the CODM’s decisions regarding the allocation of capital and resources across the business segments, ensuring alignment with the Company’s strategic objectives.

Developing and applying methodologies used to allocate items among the business segments is a dynamic process. Accordingly, financial results may be revised periodically as management systems are enhanced, methods of evaluating performance or product lines are updated, or organizational structure changes occur.

For more information on the Company’s business segments, as well as Other non-segment operations, see Note 24 in the Company’s 2025 Form 10-K.

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The following tables present certain financial data of the Company’s business segments:


	Three Months Ended March 31, 2026
(dollars in millions)	Consumer Banking	Commercial Banking	Other	Consolidated
Net interest income	$1,309	$456	($203)	$1,562
Noninterest income	299	263	44	606
Total revenue	1,608	719	(159)	2,168
Direct expenses(1)(2)	724	228	426	1,378
Indirect expenses(3)	304	106	(410)	—
Noninterest expense	1,028	334	16	1,378
Profit (loss) before provision (benefit) for credit losses	580	385	(175)	790
Provision (benefit) for credit losses	71	64	5	140
Income (loss) before income tax expense (benefit)	509	321	(180)	650
Income tax expense (benefit)	131	78	(76)	133
Net income (loss)	$378	$243	($104)	$517
Total average assets	$83,870	$67,737	$72,617	$224,224

(1) Represents operating expenses incurred by the business segments and primarily includes salaries and employee benefits, equipment and software, outside services, and occupancy.

(2) Includes depreciation and amortization of $31 million, $4 million, and $74 million, respectively, for the Consumer Banking, Commercial Banking, and Other business segments.

(3) Represents allocated corporate overhead from support functions such as information technology, finance, risk, and human resources.


	Three Months Ended March 31, 2025
(dollars in millions)	Consumer Banking	Commercial Banking	Other	Consolidated
Net interest income	$1,193	$441	($243)	$1,391
Noninterest income	297	215	32	544
Total revenue	1,490	656	(211)	1,935
Direct expenses(1)(2)	669	218	427	1,314
Indirect expenses(3)	285	109	(394)	—
Noninterest expense	954	327	33	1,314
Profit (loss) before provision (benefit) for credit losses	536	329	(244)	621
Provision (benefit) for credit losses	86	77	(10)	153
Income (loss) before income tax expense (benefit)	450	252	(234)	468
Income tax expense (benefit)	114	56	(75)	95
Net income (loss)	$336	$196	($159)	$373
Total average assets	$77,534	$65,366	$73,409	$216,309

(1) Represents operating expenses incurred by the business segments and primarily includes salaries and employee benefits, equipment and software, outside services, and occupancy.

(2) Includes depreciation and amortization of $31 million, $5 million, and $75 million, respectively, for the Consumer Banking, Commercial Banking, and Other business segments.

(3) Represents allocated corporate overhead from support functions such as information technology, finance, risk, and human resources.

Previous: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS · Next: Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK