Quarterly report pursuant to Section 13 or 15(d)

Allowance for Credit Losses (Tables)

v2.4.0.6
Allowance for Credit Losses (Tables)
6 Months Ended
Jun. 30, 2012
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 six months ended June 30, 2012 and 2011.

 
Three Months Ended June 30, 2012
(Dollars in millions)
Home Loans
 
Credit Card
and Other
Consumer
 
Commercial
 
Total
Allowance for loan and lease losses, April 1
$
20,973

 
$
7,664

 
$
3,574

 
$
32,211

Loans and leases charged off
(1,769
)
 
(2,020
)
 
(622
)
 
(4,411
)
Recoveries of loans and leases previously charged off
127

 
411

 
247

 
785

Net charge-offs
(1,642
)
 
(1,609
)
 
(375
)
 
(3,626
)
Provision for loan and lease losses
679

 
1,054

 
107

 
1,840

Other (1)
(46
)
 
(85
)
 
(6
)
 
(137
)
Allowance for loan and lease losses, June 30
19,964

 
7,024

 
3,300

 
30,288

Reserve for unfunded lending commitments, April 1

 

 
651

 
651

Provision for unfunded lending commitments

 

 
(67
)
 
(67
)
Other (2)

 

 
(10
)
 
(10
)
Reserve for unfunded lending commitments, June 30

 

 
574

 
574

Allowance for credit losses, June 30
$
19,964

 
$
7,024

 
$
3,874

 
$
30,862

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

 
$
8,569

 
$
4,135

 
$
33,783

Loans and leases charged off
(3,776
)
 
(4,262
)
 
(1,153
)
 
(9,191
)
Recoveries of loans and leases previously charged off
263

 
837

 
409

 
1,509

Net charge-offs
(3,513
)
 
(3,425
)
 
(744
)
 
(7,682
)
Provision for loan and lease losses
2,444

 
1,933

 
(80
)
 
4,297

Other (1)
(46
)
 
(53
)
 
(11
)
 
(110
)
Allowance for loan and lease losses, June 30
19,964

 
7,024

 
3,300

 
30,288

Reserve for unfunded lending commitments, January 1

 

 
714

 
714

Provision for unfunded lending commitments

 

 
(106
)
 
(106
)
Other (2)

 

 
(34
)
 
(34
)
Reserve for unfunded lending commitments, June 30

 

 
574

 
574

Allowance for credit losses, June 30
$
19,964

 
$
7,024

 
$
3,874

 
$
30,862

 
 
 
 
 
 
 
 
 
Three Months Ended June 30, 2011
Allowance for loan and lease losses, April 1
$
20,097

 
$
13,271

 
$
6,475

 
$
39,843

Loans and leases charged off
(2,603
)
 
(3,245
)
 
(759
)
 
(6,607
)
Recoveries of loans and leases previously charged off
210

 
476

 
256

 
942

Net charge-offs
(2,393
)
 
(2,769
)
 
(503
)
 
(5,665
)
Provision for loan and lease losses
3,249

 
529

 
(518
)
 
3,260

Other (1)

 
(100
)
 
(26
)
 
(126
)
Allowance for loan and lease losses, June 30
20,953

 
10,931

 
5,428

 
37,312

Reserve for unfunded lending commitments, April 1

 

 
961

 
961

Provision for unfunded lending commitments

 

 
(5
)
 
(5
)
Other (2)

 

 
(59
)
 
(59
)
Reserve for unfunded lending commitments, June 30

 

 
897

 
897

Allowance for credit losses, June 30
$
20,953

 
$
10,931

 
$
6,325

 
$
38,209

 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2011
Allowance for loan and lease losses, January 1
$
19,252

 
$
15,463

 
$
7,170

 
$
41,885

Loans and leases charged off
(4,892
)
 
(6,976
)
 
(1,665
)
 
(13,533
)
Recoveries of loans and leases previously charged off
395

 
966

 
479

 
1,840

Net charge-offs
(4,497
)
 
(6,010
)
 
(1,186
)
 
(11,693
)
Provision for loan and lease losses
6,197

 
1,508

 
(529
)
 
7,176

Other (1)
1

 
(30
)
 
(27
)
 
(56
)
Allowance for loan and lease losses, June 30
20,953

 
10,931

 
5,428

 
37,312

Reserve for unfunded lending commitments, January 1

 

 
1,188

 
1,188

Provision for unfunded lending commitments

 

 
(107
)
 
(107
)
Other (2)

 

 
(184
)
 
(184
)
Reserve for unfunded lending commitments, June 30

 

 
897

 
897

Allowance for credit losses, June 30
$
20,953

 
$
10,931

 
$
6,325

 
$
38,209

(1) 
Represents primarily the impacts of portfolio sales, deconsolidations and foreign currency translation adjustments.
(2) 
Represents primarily accretion of the Merrill Lynch purchase accounting adjustment and the impact of funding previously unfunded positions.
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 June 30, 2012 and December 31, 2011.

Allowance and Carrying Value by Portfolio Segment
 
 
 
 
 
 
 
 
June 30, 2012
(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)
$
1,890

 
$
1,698

 
$
422

 
$
4,010

Carrying value (3)
22,337

 
5,299

 
6,449

 
34,085

Allowance as a percentage of carrying value
8.46
%
 
32.04
%
 
6.54
%
 
11.76
%
Loans collectively evaluated for impairment
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
9,122

 
$
5,326

 
$
2,878

 
$
17,326

Carrying value (3, 4)
328,177

 
188,155

 
303,346

 
819,678

Allowance as a percentage of carrying value (4)
2.78
%
 
2.83
%
 
0.95
%
 
2.11
%
Purchased credit-impaired loans
 
 
 
 
 
 
 
Valuation allowance
$
8,952

 
n/a

 
n/a

 
$
8,952

Carrying value gross of valuation allowance
30,191

 
n/a

 
n/a

 
30,191

Valuation allowance as a percentage of carrying value
29.65
%
 
n/a

 
n/a

 
29.65
%
Total
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
19,964

 
$
7,024

 
$
3,300

 
$
30,288

Carrying value (3, 4)
380,705

 
193,454

 
309,795

 
883,954

Allowance as a percentage of carrying value (4)
5.24
%
 
3.63
%
 
1.07
%
 
3.43
%
 
 
 
 
 
 
 
 
 
December 31, 2011
Impaired loans and troubled debt restructurings (1)
 
 
 
 
 
 
 
Allowance for loan and lease losses (2)
$
1,946

 
$
2,410

 
$
545

 
$
4,901

Carrying value (3)
21,462

 
7,100

 
8,113

 
36,675

Allowance as a percentage of carrying value
9.07
%
 
33.94
%
 
6.71
%
 
13.36
%
Loans collectively evaluated for impairment
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
10,674

 
$
6,159

 
$
3,590

 
$
20,423

Carrying value (3, 4)
344,821

 
202,010

 
302,089

 
848,920

Allowance as a percentage of carrying value (4)
3.10
%
 
3.05
%
 
1.19
%
 
2.41
%
Purchased credit-impaired loans
 
 
 
 
 
 
 
Valuation allowance
$
8,459

 
n/a

 
n/a

 
$
8,459

Carrying value gross of valuation allowance
31,801

 
n/a

 
n/a

 
31,801

Valuation allowance as a percentage of carrying value
26.60
%
 
n/a

 
n/a

 
26.60
%
Total
 
 
 
 
 
 
 
Allowance for loan and lease losses
$
21,079

 
$
8,569

 
$
4,135

 
$
33,783

Carrying value (3, 4)
398,084

 
209,110

 
310,202

 
917,396

Allowance as a percentage of carrying value (4)
5.30
%
 
4.10
%
 
1.33
%
 
3.68
%
(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) 
Commercial impaired allowance for loan and lease losses includes $116 million and $172 million at June 30, 2012 and December 31, 2011 related to U.S. small business commercial renegotiated TDR loans.
(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 $8.4 billion and $8.8 billion at June 30, 2012 and December 31, 2011.
n/a = not applicable