Company: WFC-PC
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0000072971-25-000129
Chunk: 107

Company: WELLS FARGO & COMPANY/MN
Filing Date: 2025-04-29
Form: 10-Q
Item: Item 3
Chunk 107
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).Table 3.3 shows the composition of interest income, provision for credit losses, and gross realized gains and lossesfrom sales and impairment write-downs included in earnings related to AFS and HTM debt securities (pre-tax).Table 3.3:  Income Statement Impacts for Available-for-Sale and Held-to-Maturity Debt SecuritiesQuarter ended March 31,(in millions)20252024Interest income (1):Available-for-sale$1,942 1,366 Held-to-maturity1,379 1,755 Total interest income 3,321 3,121 Provision for credit losses:Available-for-sale(1)9 Held-to-maturity8 3 Total provision for credit losses7 12 Realized gains and losses (2):Gross realized gains2 23 Gross realized losses(116)(48)Impairment write-downs(33)— Net realized losses$(147)(25)(1)Excludes interest income from trading debt securities, which is disclosed in Note 2 (Trading Activities).(2)Realized gains and losses relate to AFS debt securities. There were no realized gains or losses from HTM debt securities in all periods presented.

62Wells Fargo & Company

Credit QualityWe monitor credit quality of debt securities by evaluating various attributes and utilize such information in our evaluation of the appropriateness of the ACL for debt securities. The credit quality indicators that we most closely monitor include credit ratings and delinquency status and are based on information as of our financial statement date.CREDIT RATINGS.  Credit ratings express opinions about the credit quality of a debt security. We determine the credit rating of a security according to the lowest credit rating made available by national recognized statistical rating organizations (NRSROs). Debt securities rated investment grade, that is those with ratings similar to BBB-/Baa3 or above, as defined by NRSROs, are generally considered by the rating agencies and market participants to be low credit risk. Conversely, debt securities rated below investment grade, labeled as “speculative grade” by the rating agencies, are considered to be distinctively higher credit risk than investment grade debt securities. For debt securities not rated by NRSROs, we determine an internal credit grade of the debt securities (used for credit risk management purposes) equivalent to the credit ratings assigned by major credit agencies. Substantially all of our debt securities were rated by NRSROs at March 31, 2025, and