Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Summary of provision (benefit) for income taxes
The following is a summary of the provision for income taxes:
  Year Ended December 31,
(dollar amounts in millions) 2023 2022 2021
Current tax provision (benefit)
Federal $ 644  $ 129  $ 356 
State 63  62  13 
Foreign 8  5  1 
Total current tax provision 715  196  370 
Deferred tax provision (benefit)
Federal (291) 319  (104)
State (11) —  28 
Total deferred tax provision (benefit) (302) 319  (76)
Provision for income taxes $ 413  $ 515  $ 294 
Reconcilement of provision (benefit) for income taxes
The following is a reconciliation for provision for income taxes:
 
Year Ended December 31,
(dollar amounts in millions) 2023 2022 2021
Provision for income taxes computed at the statutory rate $ 501  $ 580  $ 334 
Increases (decreases):
General business credits (253) (164) (126)
Tax-exempt income (28) (21) (18)
Capital loss —  (60) (32)
Affordable housing investment amortization, net of tax benefits 148  129  102 
State income taxes, net 41  49  32 
Other 4  2  2 
Provision for income taxes $ 413  $ 515  $ 294 
Significant components of deferred tax assets and liabilities
The significant components of deferred tax assets and liabilities were as follows:
  At December 31,
(dollar amounts in millions) 2023 2022
Deferred tax assets:
Fair value adjustments $ 791  $ 917 
Allowances for credit losses 564  526 
Tax credit carryforward 240  59 
Net operating and other loss carryforward 101  136 
Research and development expenses 91  — 
Lease liability 89  96 
Purchase accounting and other intangibles 82  167 
Pension and other employee benefits 70  68 
Accrued expense/prepaid 61  8 
Other assets 4  5 
Total deferred tax assets 2,093  1,982 
Deferred tax liabilities:
Lease financing 873  955 
Loan origination costs 155  97 
Mortgage servicing rights 124  112 
Operating assets 96  133 
Right-of-use asset 62  67 
Securities adjustments 40  42 
Other liabilities 3  10 
Total deferred tax liabilities 1,353  1,416 
Net deferred tax asset (liability) before valuation allowance 740  566 
Valuation allowance (30) (32)
Net deferred tax asset $ 710  $ 534 
Reconciliation of gross unrecognized tax benefits
The following table provides a reconciliation of the beginning and ending amounts of gross unrecognized tax benefits:
Year Ended December 31,
(dollar amounts in millions) 2023 2022
Unrecognized tax benefits at beginning of year $ 94  $ 93 
Gross increases for tax positions taken during prior years 8  1 
Settlements with taxing authorities (94) — 
Unrecognized tax benefits at end of year $ 8  $ 94