v3.25.3
Loans and Leases
 9 Months Ended
Sep. 30, 2025
Receivables [Abstract]  
Loans and Leases Loans and Leases
We classify loans that we have the intent and ability to hold for the foreseeable future or until maturity as loans held for investment. We report loans held for investment at their amortized cost, which includes the outstanding principal balance adjusted for any unamortized premiums, discounts, deferred fees or fair value adjustments for acquired loans.

We classify loans as held for sale when we originate or purchase loans that we intend to sell or when we change our intent for loans previously classified as held for investment. Loans held for sale for which we have elected the fair value option are carried at fair value. Loans originally classified as held for investment for which we had changed our intent and are now classified as held for sale, are carried at the lower of amortized cost or fair value. The fair value is estimated based on quoted market prices for securities backed by similar types of loans, where available, or by discounting estimated cash flows using observable inputs inclusive of interest rates, prepayment speeds and loss assumptions for similar collateral.

The composition of our loan portfolio for the periods indicated was as follows:

September 30, 2025December 31, 2024

AmountPercent of
Loans
Held for
Investment		AmountPercent of
Loans
Held for
Investment
Loans and leases held for investment:
Multi-family$30,466 48.7 %$34,093 49.9 %
Commercial real estate(1)
10,163 16.2 %11,836 17.4 %
One-to-four family first mortgage5,513 8.8 %5,201 7.6 %
Commercial and industrial(2)
14,874 23.7 %15,376 22.5 %
Other1,645 2.6 %1,766 2.6 %
Total loans and leases held for investment (3)(4)
$62,661 100.0 %$68,272 100.0 %
Allowance for credit losses on loans and leases(1,071)(1,201)
Total loans and leases held for investment, net$61,590 $67,071 
Loans held for sale
535 899 
Total loans and leases, net$62,125 $67,970 
(1)Includes ADC loans.
(2)Includes lease financing receivables (net of unearned income of $137 million and $169 million) of $1.8 billion and $2.1 billion, respectively.
(3)Excludes accrued interest receivable of $260 million and $277 million at September 30, 2025 and December 31, 2024, respectively, which is included in Other assets in the Condensed Consolidated Statements of Condition.
(4)We pledged loans of $32.3 billion and $44.6 billion between the FHLB and FRB-NY to serve as collateral for our wholesale borrowings at September 30, 2025 and December 31, 2024, respectively.
Non-Accrual Loans

A loan generally is classified as a non-accrual loan when it is 90 days or more past due or when it is deemed to be impaired because the Company no longer expects to collect principal and interest in accordance with the contractual terms of the loan agreement. When a loan is classified as non-accrual, we cease recording interest income, and any previously accrued and uncollected interest is reversed against Interest income - Loans and leases on the Condensed Consolidated Statement of (Loss) Income. Interest received on non-accrual loans is recorded as a reduction to the principal outstanding. A loan is only returned to accrual status when the loan is current (typically a minimum of six months of payment performance) and we have reasonable assurance that the loan will be fully collectible. When we have reasonable assurance that the loan will be fully collectible, then interest payments may be recognized in interest income on a cash basis. As of September 30, 2025 and December 31, 2024 there was an immaterial amount of interest income recognized on non-accrual loans classified as held for investment. At September 30, 2025 and December 31, 2024 we had no loans that were 90 days or more past due and still accruing interest.

When management determines that foreclosure is probable for loans that are individually evaluated, the expected credit losses are based on the fair value of the collateral adjusted for selling costs. When the borrower is experiencing financial difficulty at the reporting date and repayment is expected to be provided substantially through the operation or sale of the collateral, the collateral-dependent practical expedient has been elected and expected credit losses are based on the fair value of the collateral at the reporting date, adjusted for selling costs as appropriate. For CRE loans, collateral properties include office buildings, warehouse/distribution buildings, shopping centers, apartment buildings, and residential and commercial tract developments. The primary source of repayment on these loans is expected to come from the sale, permanent financing or lease of the real property collateral. CRE loans are impacted by fluctuations in collateral values, as well as the ability of the borrower to obtain permanent financing.

The following table summarizes the recorded investment of our collateral-dependent loans held for investment by collateral type as of September 30, 2025:


Real Property
Multi-family$2,435 
Commercial real estate(1)
545 
One-to-four family first mortgage59 
Commercial and industrial16 
Total collateral-dependent loans held for investment$3,055 
(1)Includes ADC loans.

At September 30, 2025 and December 31, 2024, we had $29 million and $41 million, respectively, of residential mortgage loans in the process of foreclosure.

Delinquencies

The following table presents information regarding the delinquency status of our loans held for investment at September 30, 2025:

Current
Loans 30-89 Days Past Due
Non-Accrual Loans
Total Loans Receivable
Multi-family$27,682 $344 $2,440 $30,466 
Commercial real estate(1)
9,495 117 551 10,163 
One-to-four family first mortgage5,424 19 70 5,513 
Commercial and industrial(2)
14,686 34 154 14,874 
Other1,598 21 26 1,645 
Total$58,885 $535 $3,241 $62,661 
(1)Includes ADC loans.
(2)Includes lease financing receivables.
The following table presents information regarding the delinquency status of our loans held for investment at December 31, 2024:


Current
Loans 30-89 Days Past DueNon-Accrual Loans
Total Loans Receivable
Multi-family$31,589 $749 $1,755 $34,093 
Commercial real estate(1)
11,202 70 564 11,836 
One-to-four family first mortgage5,106 25 70 5,201 
Commercial and industrial(2)
15,064 110 202 15,376 
Other1,731 11 24 1,766 
Total$64,692 $965 $2,615 $68,272 
(1)Includes ADC loans.
(2)Includes lease financing receivables.
The following table presents the credit rating by vintage for our loans held for investment as of September 30, 2025:

Term Loans
Revolving
Loans		Revolving
Loans Converted to Term Loans
Amortized Cost Basis by Closing Year

2025
2024
2023
2022
2021
Prior To
2021
Total
Multi-family:
Pass$16 $15 $578 $6,362 $5,313 $8,587 $4 $132 $21,007 
Special Mention— — 24 480 923 718 — — 2,145 
Substandard— — 140 599 1,001 3,132 2 — 4,874 
Non-accrual
— — 12 315 355 1,758 — — 2,440 
Total Multi-family
16 15 754 7,756 7,592 14,195 6 132 30,466 
Year to date gross charge-offs
— — — (45)(59)(134)— — (238)
Commercial Real Estate:(1)
Pass$600 $420 $1,126 $1,490 $963 $2,378 $1,050 $155 $8,182 
Special Mention— — 55 59 18 99 42 24 297 
Substandard— 10 62 155 82 552 167 105 1,133 
Non-accrual
— — 3 74 15 455 2 2 551 
Total Commercial Real Estate
600 430 1,246 1,778 1,078 3,484 1,261 286 10,163 
Year to date gross charge-offs
— — (6)(1)(7)(27)— — (41)
One-to-Four Family
Pass$635 $348 $475 $2,248 $815 $644 $76 $4 $5,245 
Substandard19 7 2 14 6 150 — — 198 
Non-accrual3 7 5 21 10 22 2 — 70 
Total One-to-Four Family657 362 482 2,283 831 816 78 4 5,513 
Year to date gross charge-offs
— — — (1)— (2)— — (3)
Commercial and Industrial(2)
Pass$2,069 $972 $2,164 $1,812 $614 $939 $5,307 $298 $14,175 
Special Mention— 14 10 14 7 2 80 — 127 
Substandard2 16 89 49 33 36 189 4 418 
Non-accrual— 4 29 42 6 14 48 11 154 
Total Commercial and Industrial2,071 1,006 2,292 1,917 660 991 5,624 313 14,874 
Year to date gross charge-offs
(9)(1)(15)(19)(5)(1)— — (50)
Other Loans
Pass$44 $24 $19 $6 $2 $49 $1,380 $93 $1,617 
Special Mention— — — — — — — — — 
Substandard— — — — — — 2 — 2 
Non-accrual— — — — — 2 24 — 26 
Total Other Loans44 24 19 6 2 51 1,406 93 1,645 
Year to date gross charge-offs
(6)(2)(5)(6)— (5)— — (24)
(1)Includes ADC loans.
(2)Includes lease financing receivables.
The following table presents the credit rating by vintage for our loans held for investment as of December 31, 2024:

Term Loans
Revolving
Loans		Revolving
Loans Converted to Term Loans
Amortized Cost Basis by Closing Year

2024
2023
2022
2021
2020
Prior To
2020
Total
Multi-family:
Pass$17 $700 $6,599 $6,070 $5,203 $3,997 $27 $— $22,613 
Special Mention—146886946467951—2,838
Substandard21235298681,5263,8345—6,887
Non-accrual
——1131442741,224——1,755
Total Multi-family
198377,9297,7767,6499,85033—34,093
Year to date gross charge-offs
——(28)(34)(42)(204)——(308)
Commercial Real Estate:(1)
Pass$542 $1,298 $1,753 $1,106 $576 $2,068 $1,597 $367 $9,307 
Special Mention—7213069106138120—635
Substandard23117911016272311761,330
Non-accrual
—37343644476—564
Total Commercial Real Estate
5441,4382,0961,3218483,3761,84037311,836
Year to date gross charge-offs
—(8)(81)(1)(27)(349)——(466)
One-to-Four Family
Pass$250 $521 $2,431 $859 $178 $609 $80 $2 $4,930 
Substandard128216172——201
Non-accrual
—416107285—70
Total One-to-Four Family2515272,4558712018098525,201
Year to date gross charge-offs
——(1)——(7)——(8)
Commercial and Industrial(2)
Pass$1,267 $2,609 $2,014 $651 $450 $759 $5,554 $1,164 $14,468 
Special Mention17291842111196206
Substandard135072727132658500
Non-accrual
3516098152—202
Total Commercial and Industrial1,3002,6932,2647364677985,9401,17815,376
Year to date gross charge-offs
(3)(20)(40)(20)(19)(34)——(136)
Other Loans
Pass$100 $29 $12 $4 $2 $32 $1,441 $121 $1,741 
Special Mention——————1—1
Non-accrual
—————519—24
Total Other Loans100291242371,4611211,766
Year to date gross charge-offs
(2)(4)(4)(1)(1)(8)——(20)
(1)Includes ADC loans.
(2)Includes lease financing receivables.

The classifications in the preceding tables are the most currently available and generally have been updated within the last twelve months. In addition, they follow regulatory guidelines and can generally be described as follows: pass loans are of satisfactory quality; special mention loans have potential weaknesses that deserve management’s close attention; substandard loans are inadequately protected by the current net worth and paying capacity of the borrower or of the collateral pledged (these loans have a well-defined weakness and there is a possibility that we will sustain some loss); and non-accrual loans, which based on existing circumstances, have weaknesses that make collection or liquidation in full highly questionable and improbable.

Modifications to Borrowers Experiencing Financial Difficulty

When borrowers are experiencing financial difficulty, we may make certain loan modifications as part of loss mitigation strategies to maximize expected payment. Modifications provided to borrowers who are experiencing financial difficulties are in the form of principal forgiveness, an interest rate reduction or a term extension.
During the three months ended September 30, 2025 and 2024, loans totaling $8 million and $3 million, respectively, were modified to borrowers experiencing financial difficulty. During the nine months ended September 30, 2025 and 2024 there were $26 million and $32 million, respectively, of such loans.

The following table describes the financial effect of the modification made to borrowers experiencing financial difficulty:

Interest Rate ReductionTerm Extension
Weighted-average contractual interest rate
FromTo
Weighted-Average Term (in years)
Three Months Ended September 30, 2025
One-to-four family first mortgage5.77 %4.77 %11.4
Other
9.93 %6.88 %13.1
Three Months Ended September 30, 2024
One-to-four family first mortgage— %— %10.7
Commercial and industrial— %— %1.9
Nine Months ended September 30, 2025
Commercial real estate(1)
— %— %0.5
One-to-four family first mortgage6.84 %5.37 %8.4
Other
10.06 %5.75 %13.1
Nine Months ended September 30, 2024
Multi-family8.08 %6.00 %
Commercial real estate(1)
8.13 %7.00 %
One-to-four family first mortgage4.69 %3.70 %12.1
Commercial and industrial7.81 %6.10 %0.6
Other
10.73 %4.30 %1.8
(1)Includes ADC loans.
The following table presents the amortized cost basis of the modifications for borrowers experiencing financial difficulty that subsequently defaulted and were within twelve months of the modification date:


Term ExtensionPrincipal ForgivenessCombination - Interest Rate Reduction and Term/Payment Extension/Delay
Total
Three Months Ended September 30, 2025
Commercial real estate(1)
6 — — 6 
One-to-four family first mortgage6 — 4 10 
Total$12 $— $4 $16 
Nine Months ended September 30, 2025
Commercial real estate(1)
6 — — 6 
One-to-four family first mortgage7 — 5 12 
Total$13 $— $5 $18 
Three Months Ended September 30, 2024
One-to-four family first mortgage1 — 1 2 
Commercial and industrial4 — — 4 
Total$5 $— $1 $6 
Nine Months Ended September 30, 2024
Commercial real estate(1)
$4 $— $— $4 
One-to-four family first mortgage1 — — 1 
Commercial and industrial4 — 1 5 
Other Consumer— — 1 1 
Total$9 $— $2 11 
(1)Includes ADC loans.
We closely monitor the performance of loans in which modifications were made to borrowers experiencing financial difficulty to understand the effectiveness of modification efforts.

The following table provides a summary of loan balances at September 30, 2025, which were modified during the prior twelve months, by class of financing receivable and delinquency status:

September 30, 2025

Current30 - 89 Past Due90+ Past DueTotal
Commercial real estate(1)
$— $6 $— $6 
One-to-four family first mortgage3 — 20 23 
Total$3 $6 $20 $29 
(1)Includes ADC loans.

The following table provides a summary of loan balances at September 30, 2024, which were modified during the prior twelve months, by class of financing receivable and delinquency status:

September 30, 2024

Current30 - 89 Past Due90+ Past DueTotal
Multi-family
$24 $— $— $24 
Commercial real estate(1)
8 — 4 12 
One-to-four family first mortgage7 — 5 12 
Commercial and industrial
2259
Other
1——1
Total$42 $2 $14 $58 
(1)Includes ADC loans.


Loans with Government Guarantees

Substantially all LGG are insured or guaranteed by the FHA or the U.S. Department of Veterans Affairs. Repurchased loans in this portfolio earn interest at a rate based upon the 10-year U.S. Treasury note rate from the time the underlying loan becomes 60 days delinquent until the loan is conveyed to HUD (if foreclosure timelines are met), which is not paid by the FHA until claimed. Certain loans within our portfolio may be subject to indemnifications and insurance limits which expose us to limited credit risk. As of September 30, 2025 and December 31, 2024, LGG totaled $354 million and $360 million, respectively.