Company: WFC-PC
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0000072971-25-000201
Chunk: 56

Company: WELLS FARGO & COMPANY/MN
Filing Date: 2025-08-05
Form: 10-Q
Item: Item 1
Chunk 56
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 not qualify for, or we have elected not to apply, hedge accounting. We use economic hedge derivatives to manage our non-trading exposures to interest rate risk, equity price risk, foreign currency risk, and credit risk. For additional information on other derivatives, see Note 14 (Derivatives) in our 2024 Form 10-K.Table 11.6 shows the net gains (losses) related to economic hedge derivatives. Gains (losses) on customer accommodation trading derivatives are excluded from Table 11.6. For additional information, see Note 2 (Trading Activities).Table 11.6:  Gains (Losses) on Economic Hedge Derivatives Quarter ended June 30,Six months ended June 30,(in millions)2025202420252024Interest rate contracts (1)$22 (132)$245 (429)Equity contracts (2)280 79 48 126 Foreign exchange contracts (3)(461)16 (745)168 Credit contracts (4)(38)— (43)8 Net gains (losses) recognized related to economic hedge derivatives$(197)(37)$(495)(127)(1)Derivative gains and (losses) related to mortgage banking activities were recorded in mortgage banking noninterest income. These activities include hedges of residential MSRs, residential mortgage LHFS, derivative loan commitments, and other interests held. For additional information on our mortgage banking interest rate contracts, see Note 6 (Mortgage Banking Activities). Other derivative gains and (losses) not related to mortgage banking were recorded in other noninterest income.(2)Includes derivative gains and (losses) used to economically hedge the deferred compensation plan liabilities, which were recorded in personnel noninterest expense, and derivative instruments related to our previous sales of shares of Visa Inc. Class B common stock, which were recorded in other noninterest income.(3)Includes derivatives used to mitigate foreign exchange risk of specified foreign currency-denominated assets and liabilities. Gains and (losses) were recorded in net gains from trading and securities within noninterest income.(4)Includes credit derivatives used to hedge certain loan exposures. Gains and (losses) were recorded in other noninterest income.

Wells Fargo & Company97

Note 11:  Derivatives (continued)

DERIVATIVE VALUATION ADJUSTMENTS.  We incorporate certain adjustments in determining the fair value of our derivatives, including credit valuation adjustments (CVA) to reflect counterparty credit