Quarterly report pursuant to Section 13 or 15(d)

Allowance for Credit Losses (Tables)

v2.4.0.8
Allowance for Credit Losses (Tables)
9 Months Ended
Sep. 30, 2013
Receivables [Abstract]  
Changes in the Allowance for Credit Losses
The table below summarizes the changes in the allowance for credit losses by portfolio segment for the three and nine months ended September 30, 2013 and 2012.

 
Three Months Ended September 30, 2013
(Dollars in millions)
Home Loans
 
Credit Card
and Other
Consumer
 
Commercial
 
Total
Allowance for loan and lease losses, July 1
$
12,396

 
$
5,671

 
$
3,168

 
$
21,235

Loans and leases charged off
(766
)
 
(1,296
)
 
(267
)
 
(2,329
)
Recoveries of loans and leases previously charged off
243

 
292

 
107

 
642

Net charge-offs
(523
)
 
(1,004
)
 
(160
)
 
(1,687
)
Write-offs of PCI loans
(443
)
 

 

 
(443
)
Provision for loan and lease losses
(920
)
 
730

 
481

 
291

Other (1)
3

 
33

 

 
36

Allowance for loan and lease losses, September 30
10,513

 
5,430

 
3,489

 
19,432

Reserve for unfunded lending commitments, July 1

 

 
474

 
474

Provision for unfunded lending commitments

 

 
5

 
5

Other (2)

 

 
1

 
1

Reserve for unfunded lending commitments, September 30

 

 
480

 
480

Allowance for credit losses, September 30
$
10,513

 
$
5,430

 
$
3,969

 
$
19,912

 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2012
Allowance for loan and lease losses, July 1
$
19,964

 
$
7,024

 
$
3,300

 
$
30,288

Loans and leases charged off
(2,480
)
 
(1,721
)
 
(492
)
 
(4,693
)
Recoveries of loans and leases previously charged off
137

 
294

 
140

 
571

Net charge-offs
(2,343
)
 
(1,427
)
 
(352
)
 
(4,122
)
Write-offs of PCI loans
(1,705
)
 

 

 
(1,705
)
Provision for loan and lease losses
617

 
960

 
233

 
1,810

Other (1)
1

 
(36
)
 
(3
)
 
(38
)
Allowance for loan and lease losses, September 30
16,534

 
6,521

 
3,178

 
26,233

Reserve for unfunded lending commitments, July 1

 

 
574

 
574

Provision for unfunded lending commitments

 

 
(36
)
 
(36
)
Other (2)

 

 
(20
)
 
(20
)
Reserve for unfunded lending commitments, September 30

 

 
518

 
518

Allowance for credit losses, September 30
$
16,534

 
$
6,521

 
$
3,696

 
$
26,751

 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2013
Allowance for loan and lease losses, January 1
$
14,933

 
$
6,140

 
$
3,106

 
$
24,179

Loans and leases charged off
(2,895
)
 
(4,338
)
 
(908
)
 
(8,141
)
Recoveries of loans and leases previously charged off
548

 
941

 
337

 
1,826

Net charge-offs
(2,347
)
 
(3,397
)
 
(571
)
 
(6,315
)
Write-offs of PCI loans
(1,595
)
 

 

 
(1,595
)
Provision for loan and lease losses
(409
)
 
2,694

 
957

 
3,242

Other (1)
(69
)
 
(7
)
 
(3
)
 
(79
)
Allowance for loan and lease losses, September 30
10,513

 
5,430

 
3,489

 
19,432

Reserve for unfunded lending commitments, January 1

 

 
513

 
513

Provision for unfunded lending commitments

 

 
(22
)
 
(22
)
Other (2)

 

 
(11
)
 
(11
)
Reserve for unfunded lending commitments, September 30

 

 
480

 
480

Allowance for credit losses, September 30
$
10,513

 
$
5,430

 
$
3,969

 
$
19,912

 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2012
Allowance for loan and lease losses, January 1
$
21,079

 
$
8,569

 
$
4,135

 
$
33,783

Loans and leases charged off
(6,256
)
 
(5,983
)
 
(1,645
)
 
(13,884
)
Recoveries of loans and leases previously charged off
400

 
1,131

 
549

 
2,080

Net charge-offs
(5,856
)
 
(4,852
)
 
(1,096
)
 
(11,804
)
Write-offs of PCI loans
(1,705
)
 

 

 
(1,705
)
Provision for loan and lease losses
3,061

 
2,893

 
153

 
6,107

Other (1)
(45
)
 
(89
)
 
(14
)
 
(148
)
Allowance for loan and lease losses, September 30
16,534

 
6,521

 
3,178

 
26,233

Reserve for unfunded lending commitments, January 1

 

 
714

 
714

Provision for unfunded lending commitments

 

 
(142
)
 
(142
)
Other (2)

 

 
(54
)
 
(54
)
Reserve for unfunded lending commitments, September 30

 

 
518

 
518

Allowance for credit losses, September 30
$
16,534

 
$
6,521

 
$
3,696

 
$
26,751

(1) 
Primarily represents the net impact of portfolio sales, consolidations and deconsolidations, and foreign currency translation adjustments.
(2) 
Primarily represents accretion of the Merrill Lynch purchase accounting adjustment.
Carrying Value of Outstanding Loans and Leases
The table below presents the allowance and the carrying value of outstanding loans and leases by portfolio segment at September 30, 2013 and December 31, 2012.

Allowance and Carrying Value by Portfolio Segment
 
 
 
 
 
 
 
 
September 30, 2013
(Dollars in millions)
Home Loans
 
Credit Card
and Other
Consumer
 
Commercial
 
Total
Impaired loans and troubled debt restructurings (1)
 
 
 
 
 
 
 
Allowance for loan and lease losses (2)
$
1,484

 
$
645

 
$
286

 
$
2,415

Carrying value (3)
32,606

 
2,416

 
3,356

 
38,378

Allowance as a percentage of carrying value
4.55
%
 
26.70
%
 
8.52
%
 
6.29
%
Loans collectively evaluated for impairment
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
5,795

 
$
4,785

 
$
3,203

 
$
13,783

Carrying value (3, 4)
290,375

 
184,895

 
383,380

 
858,650

Allowance as a percentage of carrying value (4)
2.00
%
 
2.59
%
 
0.84
%
 
1.61
%
Purchased credit-impaired loans
 
 
 
 
 
 
 
Valuation allowance
$
3,234

 
n/a

 
n/a

 
$
3,234

Carrying value gross of valuation allowance
27,168

 
n/a

 
n/a

 
27,168

Valuation allowance as a percentage of carrying value
11.90
%
 
n/a

 
n/a

 
11.90
%
Total
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
10,513

 
$
5,430

 
$
3,489

 
$
19,432

Carrying value (3, 4)
350,149

 
187,311

 
386,736

 
924,196

Allowance as a percentage of carrying value (4)
3.00
%
 
2.90
%
 
0.90
%
 
2.10
%
 
 
 
 
 
 
 
 
 
December 31, 2012
Impaired loans and troubled debt restructurings (1)
 
 
 
 
 
 
 
Allowance for loan and lease losses (2)
$
1,700

 
$
1,139

 
$
475

 
$
3,314

Carrying value (3)
30,250

 
3,946

 
4,881

 
39,077

Allowance as a percentage of carrying value
5.62
%
 
28.86
%
 
9.73
%
 
8.48
%
Loans collectively evaluated for impairment
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
7,697

 
$
5,001

 
$
2,631

 
$
15,329

Carrying value (3, 4)
304,701

 
187,419

 
341,502

 
833,622

Allowance as a percentage of carrying value (4)
2.53
%
 
2.67
%
 
0.77
%
 
1.84
%
Purchased credit-impaired loans
 
 
 
 
 
 
 
Valuation allowance
$
5,536

 
n/a

 
n/a

 
$
5,536

Carrying value gross of valuation allowance
26,118

 
n/a

 
n/a

 
26,118

Valuation allowance as a percentage of carrying value
21.20
%
 
n/a

 
n/a

 
21.20
%
Total
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
14,933

 
$
6,140

 
$
3,106

 
$
24,179

Carrying value (3, 4)
361,069

 
191,365

 
346,383

 
898,817

Allowance as a percentage of carrying value (4)
4.14
%
 
3.21
%
 
0.90
%
 
2.69
%
(1) 
Impaired loans include nonperforming commercial loans and all TDRs, including both commercial and consumer TDRs. Impaired loans exclude nonperforming consumer loans unless they are TDRs, and all consumer and commercial loans accounted for under the fair value option.
(2) 
Allowance for loan and lease losses includes $45 million and $97 million related to impaired U.S. small business commercial at September 30, 2013 and December 31, 2012.
(3) 
Amounts are presented gross of the allowance for loan and lease losses.
(4) 
Outstanding loan and lease balances and ratios do not include loans accounted for under the fair value option of $10.2 billion and $9.0 billion at September 30, 2013 and December 31, 2012.
n/a = not applicable