TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES 31 Commercial & Industrial Portfolio and Sensitivity to Climate Change Transition Risk With respect to our loan portfolio, while not primarily DECEMBER 31, 2022 driven by direct consideration of climate-related risks, we have significantly reduced our exposure to the Total Commercial & Industrial Outstanding Loan Outstanding Loan Total Unfounded Total Unfounded Sensitivity to energy sector through a sale of a substantial portion of Sectors1 Balances Balances Commitments Commitments Transition Risk2 our energy loan portfolio as part of a broader de-risking ($ mil) (%) ($ mil) (%) strategy. Energy loans constituted 1% of our total loan Real Estate and Rental and $1,521.0 11.5 $542.9 8.7 portfolio as of December 31, 2022. Other concentrations Leasing in our loan portfolio include commercial and residential Health Care and Social 1,408.0 10.7 371.8 5.9 real estate, healthcare, hospitality and shared national Assistance credits. As noted above, we are in the early stages of Retail trade 1,218.8 9.2 255.4 4.1 currently assessing the vulnerability of these portfolios Manufacturing 1,145.9 8.7 613.0 9.8 to climate risk. Construction 1,034.9 7.9 793.1 12.7 Based on our severe weather experience to date, Wholesale trade 997.9 7.6 617.5 9.9 storms generally prompt temporary evacuation and unplanned closures of businesses, leading to supply Finance and insurance 966.7 7.3 568.8 9.1 chain disruptions, labor constraints, and cancellation Transportation and 872.2 6.6 309.8 4.9 or postponement of events that foster tourism. Certain warehousing income categories, such as ATM fees and secondary Professional, scientific, and 706.4 5.4 438.8 7.0 mortgage market operations, can also be temporarily technical services impacted by storm disruptions. However, our hurricane- Accommodation, food services 637.9 4.8 167.2 2.7 impacted markets generally experience increased and entertainment economic activity as the communities rebuild and recover Public administration 542.7 4.1 19.0 0.3 from the damage. As a result, deposit levels historically Other services (except public 396.6 3.0 136.4 2.2 have increased, primarily driven by stimulus funding and administration) insurance proceeds. Information 386.6 2.9 121.5 1.9 Admin, Support, Waste Mgmt, With respect to the consideration of new opportunities, Remediation Services 314.9 2.4 156.4 2.5 the Company has a New Product and Initiative (NPI) Educational services 298.1 2.3 147.6 2.4 Policy to prudently manage and assess the risks associated with the innovation and development of new, Energy 242.1 1.8 112.3 1.8 expanded, or modified products and services offered Other 488.8 3.7 891.5 14.2 by the Company. The policy defines what an NPI is and provides criteria to help make that determination. It also Total Commercial & Industrial $13,179.5 100.0 $6,263.0 100.0 sets forth the vetting and approval process required Portfolio for NPIs, including risk assessment, whether posed 1 2 Commercial and industrial loans include commercial non-real estate and Sensitivity to transition risk in terms of likelihood of negative rating migration in by climate-related risks or otherwise. Our NPI policy commercial real estate owner occupied. a disorderly transition scenario to a lower carbon economy enables us to assess the inherent risks associated with Sensitivity significant enough to cause negative rating a proposed new product and/or initiative, to identify the No expected impact Moderate Sensitivity migration in more than 25% of the subportfolio requirements or actions necessary to sufficiently mitigate