STI 2018 Annual Report

36 NONINTEREST INCOME Components of Noninterest Income Table 3 Year Ended December 31 (Dollars in millions) 2018 2017 2016 Service charges on deposit accounts $579 $603 $630 Other charges and fees 1 356 361 359 Card fees 324 344 327 Investment banking income 1 599 623 515 Trading income 161 189 211 Mortgage related income 2 342 422 555 Trust and investment management income 304 309 304 Retail investment services 292 278 281 Commercial real estate related income 134 123 69 Net securities gains/(losses) 1 (108) 4 Gain on sale of subsidiary — 107 — Other noninterest income 134 103 128 Total noninterest income $3,226 $3,354 $3,383 1 Beginning July 1, 2018, we began presenting bridge commitment fee income related to capital market transactions in Investment banking income on the Consolidated Statements of Income. For periods prior to July 1, 2018, this income was previously presented in Other charges and fees and has been reclassified to Investment banking income for comparability. Capital market bridge fee income totaled $14 million, $24 million, and $21 million for the years ended December 31, 2018, 2017, and 2016, respectively. 2 Beginning with this Form 10-K, we began presenting Mortgage production related income and Mortgage servicing related income as a single line item on the Consolidated Statements of Income titled Mortgage related income. Prior periods have been conformed to this updated presentation for comparability. Noninterest income decreased $128 million, or 4%, compared to 2017, driven primarily by lowermortgage and capital markets- related income as well as lower client transaction-related fees, offset partially by increases in other noninterest income, commercial real estate related income, and wealth management- related income. Client transaction-related fee income, which includes service charges on deposit accounts, other charges and fees, and card fees, decreased $49 million, or 4%, compared to 2017, driven primarily by the impact of our January 1, 2018 adoption of the revenue recognition accounting standard, which resulted in the netting of certain expense items against this income, as well as by a change in our process for recognizing card rewards expenses in the third quarter of 2018. The revenue recognition accounting standard decreased client transaction-related fee income by $38 million for the year ended December 31, 2018. See Note 1, "Significant Accounting Policies," to the Consolidated Financial Statements in this Form 10-K for additional information regarding our adoption of this accounting standard. Investment banking income decreased $24 million, or 4%, compared to 2017. This decrease was due primarily to decreased activity in loan syndications, leveraged finance, and investment grade bond originations. These decreases were offset partially by strong deal flow activity in mergers and acquisitions and equity offerings, as well as by our adoption of the revenue recognition accounting standard, which increased investment banking income by $13 million for the year ended December 31, 2018. Trading income decreased $28 million, or 15%, compared to 2017. This decrease was due primarily to lower fixed income sales and trading revenue. Mortgage related income decreased $80 million, or 19%, compared to 2017 driven by a $77 million, or 33%, decrease in mortgage production related income. The decrease in mortgage production related income was driven primarily by lower gain on sale margins, reduced refinance activity, and less favorable channel mix, offset partially by a repurchase reserve release during the fourth quarter of 2018. Mortgage application and closed loan volume both decreased 8% compared to 2017. The UPB of mortgage loans in the servicing portfolio was $171.4 billion at December 31, 2018, compared to $165.5 billion at December 31, 2017. Retail investment services income increased $14 million, or 5%, compared to 2017, driven primarily by growth in assets under management. Commercial real estate related income increased $11 million, or 9%, compared to 2017. This increase was due primarily to increased structured real estate revenue and higher tax credit-related income from our investments in affordable housing partnerships, offset partially by a decline in transactional activity in our agency lending business. Net securities gains totaled $1 million compared to net securities losses of $108 million in 2017. Net securities losses for 2017 were driven by $109 million of securitiesAFS portfolio restructuring losses. Gain on sale of subsidiaries totaled $107 million for 2017, resulting from our gain from the sale of PAC during the fourth quarter of 2017. See Note 3, "Acquisitions/Dispositions," to the Consolidated Financial Statements in this Form 10-K for additional information regarding the sale of PAC. Other noninterest income increased $31 million, or 30%, compared to 2017. This increasewas due primarily to $30million of remeasurement gains on an equity investment following our full adoption of the recognition and measurement of financial