Outstanding Loans and Leases and Allowance for Credit Losses

v3.22.2.2

Outstanding Loans and Leases and Allowance for Credit Losses	9 Months Ended
	Sep. 30, 2022
Receivables [Abstract]
Outstanding Loans and Leases and Allowance for Credit Losses	Outstanding Loans and Leases and Allowance for Credit Losses The following tables present total outstanding loans and leases and an aging analysis for the Consumer Real Estate, Credit Card and Other Consumer, and Commercial portfolio segments, by class of financing receivables, at September 30, 2022 and December 31, 2021. 30-59 Days  Past Due (1) 60-89 Days  Past Due (1) 90 Days or More Past Due (1) Total Past Due 30 Days or More Total  Current or  Less Than  30 Days  Past Due (1) Loans  Accounted  for Under  the Fair  Value  Option Total Outstandings (Dollars in millions) September 30, 2022 Consumer real estate             Residential mortgage $ 905  $ 235  $ 1,014  $ 2,154  $ 226,908  $ 229,062  Home equity 79  27  232  338  26,507  26,845  Credit card and other consumer Credit card 393  262  547  1,202  86,094  87,296  Direct/Indirect consumer (2) 199  53  33  285  106,874  107,159  Other consumer —  —  —  —  171  171  Total consumer 1,576  577  1,826  3,979  446,554  450,533  Consumer loans accounted for under the fair value option (3)           $ 355  355  Total consumer loans and leases 1,576  577  1,826  3,979  446,554  355  450,888  Commercial U.S. commercial 519  327  447  1,293  354,077  355,370  Non-U.S. commercial 48  67  228  343  122,692  123,035  Commercial real estate (4) 299  36  74  409  67,543  67,952  Commercial lease financing 28  7  20  55  12,901  12,956  U.S. small business commercial (5) 196  143  253  592  17,177  17,769  Total commercial 1,090  580  1,022  2,692  574,390  577,082  Commercial loans accounted for under the fair value option (3)           4,496  4,496  Total commercial loans and leases 1,090  580  1,022  2,692  574,390  4,496  581,578  Total loans and leases (6) $ 2,666  $ 1,157  $ 2,848  $ 6,671  $ 1,020,944  $ 4,851  $ 1,032,466  Percentage of outstandings 0.26  % 0.11  % 0.28  % 0.65  % 98.88  % 0.47  % 100.00  % (1)Consumer real estate loans 30-59 days past due includes fully-insured loans of $173 million and nonperforming loans of $101 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $72 million and nonperforming loans of $98 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $427 million. Consumer real estate loans current or less than 30 days past due includes $1.7 billion, and direct/indirect consumer includes $29 million of nonperforming loans. (2)Total outstandings primarily includes auto and specialty lending loans and leases of $50.7 billion, U.S. securities-based lending loans of $52.6 billion and non-U.S. consumer loans of $2.9 billion. (3)Consumer loans accounted for under the fair value option includes residential mortgage loans of $74 million and home equity loans of $281 million. Commercial loans accounted for under the fair value option includes U.S. commercial loans of $2.4 billion and non-U.S. commercial loans of $2.1 billion. For more information, see Note 14 – Fair Value Measurements and Note 15 – Fair Value Option. (4)Total outstandings includes U.S. commercial real estate loans of $63.9 billion and non-U.S. commercial real estate loans of $4.0 billion. (5)Includes Paycheck Protection Program loans. (6)Total outstandings includes loans and leases pledged as collateral of $13.3 billion. The Corporation also pledged $163.6 billion of loans with no related outstanding borrowings to secure potential borrowing capacity with the Federal Reserve Bank and Federal Home Loan Bank. 30-59 Days Past Due (1) 60-89 Days  Past Due (1) 90 Days or More Past Due (1) Total Past Due 30 Days or More Total Current or Less Than 30 Days Past Due (1) Loans Accounted for Under the Fair Value Option Total Outstandings (Dollars in millions) December 31, 2021 Consumer real estate             Residential mortgage $ 1,005  $ 297  $ 1,571  $ 2,873  $ 219,090  $ 221,963  Home equity 123  69  369  561  27,374  27,935  Credit card and other consumer           Credit card 298  212  487  997  80,441    81,438  Direct/Indirect consumer (2) 147  52  18  217  103,343    103,560  Other consumer  —  —  —  —  190    190  Total consumer 1,573  630  2,445  4,648  430,438  435,086  Consumer loans accounted for under the fair value option (3) $ 618  618  Total consumer loans and leases 1,573  630  2,445  4,648  430,438  618  435,704  Commercial               U.S. commercial 815  308  396  1,519  324,417    325,936  Non-U.S. commercial 148  20  83  251  113,015    113,266  Commercial real estate (4) 115  34  285  434  62,575    63,009  Commercial lease financing 104  28  13  145  14,680    14,825  U.S. small business commercial (5) 129  259  89  477  18,706    19,183  Total commercial 1,311  649  866  2,826  533,393    536,219  Commercial loans accounted for under the fair value option (3) 7,201  7,201  Total commercial loans and leases 1,311  649  866  2,826  533,393  7,201  543,420  Total loans and leases (6) $ 2,884  $ 1,279  $ 3,311  $ 7,474  $ 963,831  $ 7,819  $ 979,124  Percentage of outstandings 0.29  % 0.13  % 0.34  % 0.76  % 98.44  % 0.80  % 100.00  % (1)Consumer real estate loans 30-59 days past due includes fully-insured loans of $164 million and nonperforming loans of $118 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $89 million and nonperforming loans of $100 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $633 million. Consumer real estate loans current or less than 30 days past due includes $1.4 billion, and direct/indirect consumer includes $55 million of nonperforming loans. (2)Total outstandings primarily includes auto and specialty lending loans and leases of $48.5 billion, U.S. securities-based lending loans of $51.1 billion and non-U.S. consumer loans of $3.0 billion. (3)Consumer loans accounted for under the fair value option includes residential mortgage loans of $279 million and home equity loans of $339 million. Commercial loans accounted for under the fair value option includes U.S. commercial loans of $4.6 billion and non-U.S. commercial loans of $2.6 billion. For more information, see Note 14 – Fair Value Measurements and Note 15 – Fair Value Option. (4)Total outstandings includes U.S. commercial real estate loans of $58.2 billion and non-U.S. commercial real estate loans of $4.8 billion. (5)Includes Paycheck Protection Program loans. (6)Total outstandings includes loans and leases pledged as collateral of $13.0 billion. The Corporation also pledged $146.6 billion of loans with no related outstanding borrowings to secure potential borrowing capacity with the Federal Reserve Bank and Federal Home Loan Bank. The Corporation has entered into long-term credit protection agreements with FNMA and FHLMC on loans totaling $9.7 billion and $10.5 billion at September 30, 2022 and December 31, 2021, providing full credit protection on residential mortgage loans that become severely delinquent. All of these loans are individually insured, and therefore the Corporation does not record an allowance for credit losses related to these loans. Nonperforming Loans and Leases Commercial nonperforming loans decreased to $1.2 billion at September 30, 2022 from $1.6 billion at December 31, 2021. Consumer nonperforming loans decreased to $2.8 billion at September 30, 2022 from $3.0 billion at December 31, 2021 primarily due to decreases from consumer real estate loan sales, partially offset by increases from loans with expired deferrals that were modified in TDRs during the first quarter of 2022. The following table presents the Corporation’s nonperforming loans and leases, including nonperforming TDRs, and loans accruing past due 90 days or more at September 30, 2022 and December 31, 2021. Nonperforming loans held-for-sale (LHFS) are excluded from nonperforming loans and leases as they are recorded at either fair value or the lower of cost or fair value. For more information on the criteria for classification as nonperforming, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation’s 2021 Annual Report on Form 10-K. Credit Quality Nonperforming Loans and Leases Accruing Past Due 90 Days or More (Dollars in millions) September 30 2022 December 31 2021 September 30 2022 December 31 2021 Residential mortgage (1) $ 2,187  $ 2,284  $ 427  $ 634  With no related allowance (2) 1,942  1,950  —  —  Home equity (1) 532  630  —  —  With no related allowance (2) 394  414  —  —  Credit Card                      n/a               n/a 547  487  Direct/indirect consumer 41  75  27  11  Total consumer 2,760  2,989  1,001  1,132  U.S. commercial 640  825  300  171  Non-U.S. commercial 274  268  22  19  Commercial real estate 282  382  34  40  Commercial lease financing 11  80  12  8  U.S. small business commercial 16  23  252  87  Total commercial 1,223  1,578  620  325  Total nonperforming loans $ 3,983  $ 4,567  $ 1,621  $ 1,457  Percentage of outstanding loans and leases 0.39  % 0.47  % 0.16  % 0.15  % (1)Residential mortgage loans accruing past due 90 days or more are fully-insured loans. At September 30, 2022 and December 31, 2021 residential mortgage includes $321 million and $444 million of loans on which interest had been curtailed by the Federal Housing Administration (FHA), and therefore were no longer accruing interest, although principal was still insured, and $106 million and $190 million of loans on which interest was still accruing. (2)Primarily relates to loans for which the estimated fair value of the underlying collateral less any costs to sell is greater than the amortized cost of the loans as of the reporting date. n/a = not applicable Credit Quality Indicators The Corporation monitors credit quality within its Consumer Real Estate, Credit Card and Other Consumer, and Commercial portfolio segments based on primary credit quality indicators. For more information on the portfolio segments, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation’s 2021 Annual Report on Form 10-K. Within the Consumer Real Estate portfolio segment, the primary credit quality indicators are refreshed loan-to-value (LTV) and refreshed Fair Isaac Corporation (FICO) score. Refreshed LTV measures the carrying value of the loan as a percentage of the value of the property securing the loan, refreshed quarterly. Home equity loans are evaluated using combined loan-to-value (CLTV), which measures the carrying value of the Corporation’s loan and available line of credit combined with any outstanding senior liens against the property as a percentage of the value of the property securing the loan, refreshed quarterly. FICO score measures the creditworthiness of the borrower based on the financial obligations of the borrower and the borrower’s credit history. FICO scores are typically refreshed quarterly or more frequently. Certain borrowers (e.g., borrowers that have had debts discharged in a bankruptcy proceeding) may not have their FICO scores updated. FICO scores are also a primary credit quality indicator for the Credit Card and Other Consumer portfolio segment and the business card portfolio within U.S. small business commercial. Within the Commercial portfolio segment, loans are evaluated using the internal classifications of pass rated or reservable criticized as the primary credit quality indicators. The term reservable criticized refers to those commercial loans that are internally classified or listed by the Corporation as Special Mention, Substandard or Doubtful, which are asset quality categories defined by regulatory authorities. These assets have an elevated level of risk and may have a high probability of default or total loss. Pass rated refers to all loans not considered reservable criticized. In addition to these primary credit quality indicators, the Corporation uses other credit quality indicators for certain types of loans. The following tables present certain credit quality indicators for the Corporation's Consumer Real Estate, Credit Card and Other Consumer, and Commercial portfolio segments by class of financing receivables and year of origination for term loan balances at September 30, 2022, including revolving loans that converted to term loans without an additional credit decision after origination or through a TDR. Residential Mortgage – Credit Quality Indicators By Vintage Term Loans by Origination Year (Dollars in millions) Total as of September 30,  2022 2022 2021 2020 2019 2018 Prior Residential Mortgage Refreshed LTV       Less than or equal to 90 percent $ 215,122  $ 35,371  $ 82,564  $ 37,941  $ 19,347  $ 5,900  $ 33,999  Greater than 90 percent but less than or equal to 100 percent 1,446  803  513  87  15  9  19  Greater than 100 percent 562  331  119  39  18  10  45  Fully-insured loans 11,932  511  3,737  3,173  977  165  3,369  Total Residential Mortgage $ 229,062  $ 37,016  $ 86,933  $ 41,240  $ 20,357  $ 6,084  $ 37,432  Residential Mortgage Refreshed FICO score Less than 620 $ 2,054  $ 317  $ 489  $ 343  $ 108  $ 86  $ 711  Greater than or equal to 620 and less than 680 4,933  903  1,356  836  371  240  1,227  Greater than or equal to 680 and less than 740 24,594  4,303  8,441  4,372  2,159  812  4,507  Greater than or equal to 740 185,549  30,982  72,910  32,516  16,742  4,781  27,618  Fully-insured loans 11,932  511  3,737  3,173  977  165  3,369  Total Residential Mortgage $ 229,062  $ 37,016  $ 86,933  $ 41,240  $ 20,357  $ 6,084  $ 37,432  Home Equity - Credit Quality Indicators Total Home Equity Loans and Reverse Mortgages (1) Revolving Loans Revolving Loans Converted to Term Loans (Dollars in millions) September 30, 2022 Home Equity Refreshed LTV       Less than or equal to 90 percent $ 26,662  $ 1,406  $ 19,805  $ 5,451  Greater than 90 percent but less than or equal to 100 percent 68  25  24  19  Greater than 100 percent 115  41  37  37  Total Home Equity $ 26,845  $ 1,472  $ 19,866  $ 5,507  Home Equity Refreshed FICO score Less than 620 $ 689  $ 177  $ 175  $ 337  Greater than or equal to 620 and less than 680 1,210  167  475  568  Greater than or equal to 680 and less than 740 4,228  355  2,550  1,323  Greater than or equal to 740 20,718  773  16,666  3,279  Total Home Equity $ 26,845  $ 1,472  $ 19,866  $ 5,507  (1)Includes reverse mortgages of $1.2 billion and home equity loans of $450 million, which are no longer originated. Credit Card and Direct/Indirect Consumer – Credit Quality Indicators By Vintage Direct/Indirect Term Loans by Origination Year Credit Card (Dollars in millions) Total Direct/ Indirect as of September 30, 2022 Revolving Loans 2022 2021 2020 2019 2018 Prior Total Credit Card as of September 30, 2022 Revolving Loans Revolving Loans Converted to Term Loans (1) Refreshed FICO score     Less than 620 $ 730  $ 12  $ 140  $ 262  $ 108  $ 90  $ 48  $ 70  $ 3,442  $ 3,277  $ 165  Greater than or equal to 620 and less than 680 2,381  12  832  867  293  177  81  119  10,134  9,950  184  Greater than or equal to 680 and less than 740 8,723  53  3,290  3,036  1,116  619  254  355  30,181  30,012  169  Greater than or equal to 740 38,988  86  12,944  12,425  6,354  3,675  1,505  1,999  43,539  43,496  43  Other internal credit    metrics (2,3) 56,337  55,534  168  292  79  56  39  169  —  —  —  Total credit card and other    consumer $ 107,159  $ 55,697  $ 17,374  $ 16,882  $ 7,950  $ 4,617  $ 1,927  $ 2,712  $ 87,296  $ 86,735  $ 561  (1)Represents TDRs that were modified into term loans. (2)Other internal credit metrics may include delinquency status, geography or other factors. (3)Direct/indirect consumer includes $55.5 billion of securities-based lending, which is typically supported by highly liquid collateral with market value greater than or equal to the outstanding loan balance and therefore has minimal credit risk at September 30, 2022. Commercial – Credit Quality Indicators By Vintage (1) Term Loans Amortized Cost Basis by Origination Year (Dollars in millions) Total as of September 30, 2022 2022 2021 2020 2019 2018 Prior Revolving Loans U.S. Commercial Risk ratings         Pass rated $ 346,130  $ 51,059  $ 42,706  $ 19,446  $ 17,967  $ 9,431  $ 31,503  $ 174,018  Reservable criticized 9,240  176  636  665  831  1,320  918  4,694  Total U.S. Commercial $ 355,370  $ 51,235  $ 43,342  $ 20,111  $ 18,798  $ 10,751  $ 32,421  $ 178,712  Non-U.S. Commercial Risk ratings Pass rated $ 120,431  $ 19,045  $ 21,046  $ 5,827  $ 4,393  $ 2,964  $ 5,185  $ 61,971  Reservable criticized 2,604  60  387  241  315  194  483  924  Total Non-U.S. Commercial $ 123,035  $ 19,105  $ 21,433  $ 6,068  $ 4,708  $ 3,158  $ 5,668  $ 62,895  Commercial Real Estate Risk ratings Pass rated $ 63,433  $ 11,573  $ 13,619  $ 6,313  $ 9,474  $ 5,080  $ 9,066  $ 8,308  Reservable criticized 4,519  9  366  567  1,513  888  1,065  111  Total Commercial Real Estate $ 67,952  $ 11,582  $ 13,985  $ 6,880  $ 10,987  $ 5,968  $ 10,131  $ 8,419  Commercial Lease Financing Risk ratings Pass rated $ 12,720  $ 1,583  $ 2,699  $ 2,076  $ 2,048  $ 1,404  $ 2,910  $ —  Reservable criticized 236  5  23  14  76  47  71  —  Total Commercial Lease Financing $ 12,956  $ 1,588  $ 2,722  $ 2,090  $ 2,124  $ 1,451  $ 2,981  $ —  U.S. Small Business Commercial (2) Risk ratings Pass rated $ 8,910  $ 1,323  $ 2,174  $ 1,688  $ 907  $ 657  $ 2,030  $ 131  Reservable criticized 313  3  21  41  75  53  117  3  Total U.S. Small Business Commercial $ 9,223  $ 1,326  $ 2,195  $ 1,729  $ 982  $ 710  $ 2,147  $ 134   Total $ 568,536  $ 84,836  $ 83,677  $ 36,878  $ 37,599  $ 22,038  $ 53,348  $ 250,160  (1) Excludes $4.5 billion of loans accounted for under the fair value option at September 30, 2022. (2)     Excludes U.S. Small Business Card loans of $8.5 billion. Refreshed FICO scores for this portfolio are $244 million for less than 620; $786 million for greater than or equal to 620 and less than 680; $2.3 billion for greater than or equal to 680 and less than 740; and $5.2 billion greater than or equal to 740. The following tables present certain credit quality indicators for the Corporation's Consumer Real Estate, Credit Card and Other Consumer, and Commercial portfolio segments by class of financing receivables and year of origination for term loan balances at December 31, 2021, including revolving loans that converted to term loans without an additional credit decision after origination or through a TDR. Residential Mortgage – Credit Quality Indicators By Vintage Term Loans by Origination Year (Dollars in millions) Total as of  December 31,  2021 2021 2020 2019 2018 2017 Prior Residential Mortgage Refreshed LTV Less than or equal to 90 percent $ 206,562  $ 87,051  $ 43,597  $ 23,205  $ 7,392  $ 10,956  $ 34,361  Greater than 90 percent but less than or equal to 100 percent 1,938  1,401  331  81  17  14  94  Greater than 100 percent 759  520  112  29  11  12  75  Fully-insured loans 12,704  3,845  3,486  1,150  216  235  3,772  Total Residential Mortgage $ 221,963  $ 92,817  $ 47,526  $ 24,465  $ 7,636  $ 11,217  $ 38,302  Residential Mortgage Refreshed FICO score Less than 620 $ 2,451  $ 636  $ 442  $ 140  $ 120  $ 104  $ 1,009  Greater than or equal to 620 and less than 680 5,199  1,511  1,123  477  294  307  1,487  Greater than or equal to 680 and less than 740 24,532  8,822  5,454  2,785  1,057  1,434  4,980  Greater than or equal to 740 177,077  78,003  37,021  19,913  5,949  9,137  27,054  Fully-insured loans 12,704  3,845  3,486  1,150  216  235  3,772  Total Residential Mortgage $ 221,963  $ 92,817  $ 47,526  $ 24,465  $ 7,636  $ 11,217  $ 38,302  Home Equity - Credit Quality Indicators Total Home Equity Loans and Reverse Mortgages (1) Revolving Loans Revolving Loans Converted to Term Loans (Dollars in millions) December 31, 2021 Home Equity Refreshed LTV Less than or equal to 90 percent $ 27,594  $ 1,773  $ 19,095  $ 6,726  Greater than 90 percent but less than or equal to 100 percent 130  55  34  41  Greater than 100 percent 211  85  54  72  Total Home Equity $ 27,935  $ 1,913  $ 19,183  $ 6,839  Home Equity Refreshed FICO score Less than 620 $ 893  $ 244  $ 209  $ 440  Greater than or equal to 620 and less than 680 1,434  222  495  717  Greater than or equal to 680 and less than 740 4,625  468  2,493  1,664  Greater than or equal to 740 20,983  979  15,986  4,018  Total Home Equity $ 27,935  $ 1,913  $ 19,183  $ 6,839  (1)Includes reverse mortgages of $1.3 billion and home equity loans of $582 million, which are no longer originated. Credit Card and Direct/Indirect Consumer – Credit Quality Indicators By Vintage Direct/Indirect Term Loans by Origination Year Credit Card (Dollars in millions) Total Direct/Indirect as of December 31, 2021 Revolving Loans 2021 2020 2019 2018 2017 Prior Total Credit Card as of December 31, 2021 Revolving Loans Revolving Loans Converted to Term Loans (1) Refreshed FICO score Less than 620 $ 685  $ 13  $ 179  $ 115  $ 129  $ 79  $ 101  $ 69  $ 3,017  $ 2,857  $ 160  Greater than or equal to 620 and less than 680 2,313  14  1,170  414  313  148  134  120  9,264  9,064  200  Greater than or equal to 680 and less than 740 8,530  60  4,552  1,659  1,126  466  314  353  28,347  28,155  192  Greater than or equal to 740 37,164  94  15,876  8,642  6,465  2,679  1,573  1,835  40,810  40,762  48  Other internal credit    metrics (2, 3) 54,868  54,173  283  53  77  75  63  144  —  —  —  Total credit card and other    consumer $ 103,560  $ 54,354  $ 22,060  $ 10,883  $ 8,110  $ 3,447  $ 2,185  $ 2,521  $ 81,438  $ 80,838  $ 600  (1)Represents TDRs that were modified into term loans. (2)Other internal credit metrics may include delinquency status, geography or other factors. (3)Direct/indirect consumer includes $54.2 billion of securities-based lending, which is typically supported by highly liquid collateral with market value greater than or equal to the outstanding loan balance and therefore has minimal credit risk at December 31, 2021. Commercial – Credit Quality Indicators By Vintage (1) Term Loans Amortized Cost Basis by Origination Year (Dollars in millions) Total as of December 31, 2021 2021 2020 2019 2018 2017 Prior Revolving Loans U.S. Commercial Risk ratings         Pass rated $ 315,618  $ 55,862  $ 25,012  $ 23,373  $ 11,439  $ 10,426  $ 23,877  $ 165,629  Reservable criticized 10,318  598  687  1,308  1,615  514  1,072  4,524  Total U.S. Commercial $ 325,936  $ 56,460  $ 25,699  $ 24,681  $ 13,054  $ 10,940  $ 24,949  $ 170,153  Non-U.S. Commercial Risk ratings Pass rated $ 110,787  $ 25,749  $ 8,703  $ 7,133  $ 4,521  $ 3,016  $ 3,062  $ 58,603  Reservable criticized 2,479  223  324  487  275  257  216  697  Total Non-U.S. Commercial $ 113,266  $ 25,972  $ 9,027  $ 7,620  $ 4,796  $ 3,273  $ 3,278  $ 59,300  Commercial Real Estate Risk ratings Pass rated $ 55,511  $ 14,402  $ 7,244  $ 11,237  $ 5,710  $ 3,326  $ 6,831  $ 6,761  Reservable criticized 7,498  277  990  2,237  1,710  596  1,464  224  Total Commercial Real Estate $ 63,009  $ 14,679  $ 8,234  $ 13,474  $ 7,420  $ 3,922  $ 8,295  $ 6,985  Commercial Lease Financing Risk ratings Pass rated $ 14,438  $ 3,280  $ 2,485  $ 2,427  $ 2,030  $ 1,741  $ 2,475  $ —  Reservable criticized 387  25  18  91  67  48  138  —  Total Commercial Lease Financing $ 14,825  $ 3,305  $ 2,503  $ 2,518  $ 2,097  $ 1,789  $ 2,613  $ —  U.S. Small Business Commercial (2) Risk ratings Pass rated $ 11,618  $ 4,257  $ 2,922  $ 1,059  $ 763  $ 623  $ 1,853  $ 141  Reservable criticized 433  12  29  91  87  64  147  3  Total U.S. Small Business Commercial $ 12,051  $ 4,269  $ 2,951  $ 1,150  $ 850  $ 687  $ 2,000  $ 144   Total $ 529,087  $ 104,685  $ 48,414  $ 49,443  $ 28,217  $ 20,611  $ 41,135  $ 236,582  (1) Excludes $7.2 billion of loans accounted for under the fair value option at December 31, 2021. (2) Excludes U.S. Small Business Card loans of $7.1 billion. Refreshed FICO scores for this portfolio are $192 million for less than 620; $618 million for greater than or equal to 620 and less than 680; $1.9 billion for greater than or equal to 680 and less than 740; and $4.4 billion greater than or equal to 740. During the nine months ended September 30, 2022, commercial credit quality showed signs of stabilization. Commercial reservable criticized utilized exposure decreased to $17.7 billion at September 30, 2022 from $22.4 billion (to 2.88 percent from 3.91 percent of total commercial reservable utilized exposure) at December 31, 2021, which was broad-based across industries. Troubled Debt Restructurings Consumer Real Estate Modifications of consumer real estate loans are classified as TDRs when the borrower is experiencing financial difficulties and a concession has been granted. Concessions may include reductions in interest rates, capitalization of past due amounts, principal and/or interest forbearance, payment extensions, principal and/or interest forgiveness, or combinations thereof. Prior to permanently modifying a loan, the Corporation may enter into trial modifications with certain borrowers under both government and proprietary programs. Trial modifications generally represent a three- to four-month period during which the borrower makes monthly payments under the anticipated modified payment terms. Upon successful completion of the trial period, the Corporation and the borrower enter into a permanent modification. Binding trial modifications are classified as TDRs when the trial offer is made and continue to be classified as TDRs regardless of whether the borrower enters into a permanent modification. Consumer real estate loans of $224 million that have been discharged in Chapter 7 bankruptcy with no change in repayment terms and not reaffirmed by the borrower were included in TDRs at September 30, 2022, of which $56 million were classified as nonperforming and $38 million were loans fully insured. At September 30, 2022 and December 31, 2021, remaining commitments to lend additional funds to debtors whose terms have been modified in a consumer real estate TDR were not significant. Consumer real estate foreclosed properties totaled $125 million and $101 million at September 30, 2022 and December 31, 2021. The carrying value of consumer real estate loans, including fully-insured loans, for which formal foreclosure proceedings were in process at September 30, 2022 and December 31, 2021 was $946 million and $1.1 billion. During the nine months ended September 30, 2022 and 2021, the Corporation reclassified $151 million and $33 million of consumer real estate loans to foreclosed properties or, for properties acquired upon foreclosure of certain government-guaranteed loans (principally FHA-insured loans), to other assets. The reclassifications represent non-cash investing activities and, accordingly, are not reflected in the Consolidated Statement of Cash Flows. The table below presents the September 30, 2022 and 2021 unpaid principal balance, carrying value, and average pre- and post-modification interest rates of consumer real estate loans that were modified in TDRs during the three and nine months ended September 30, 2022 and 2021. The following Consumer Real Estate portfolio segment tables include loans that were initially classified as TDRs during the period and also loans that had previously been classified as TDRs and were modified again during the period. Consumer Real Estate – TDRs Entered into During the Three and Nine Months Ended September 30, 2022 and 2021 Unpaid Principal Balance Carrying Value Pre-Modification Interest Rate Post-Modification Interest Rate (1) Unpaid Principal Balance Carrying Value Pre-Modification Interest Rate Post-Modification Interest Rate (1) (Dollars in millions) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Residential mortgage $ 420  $ 379  3.35  % 3.34  % $ 1,036  $ 929  3.50  % 3.36  % Home equity 99  86  4.58  4.83  216  176  4.20  4.31  Total $ 519  $ 465  3.58  3.62  $ 1,252  $ 1,105  3.62  3.52  Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Residential mortgage $ 451  $ 399  3.52  % 3.49  % $ 832  $ 742  3.49  % 3.44  % Home equity 61  45  3.51  3.51  97  73  3.56  3.58  Total $ 512  $ 444  3.52  3.49  $ 929  $ 815  3.50  3.46  (1)The post-modification interest rate reflects the interest rate applicable only to permanently completed modifications, which exclude loans that are in a trial modification period. The table below presents the September 30, 2022 and 2021 carrying value for consumer real estate loans that were modified in a TDR during the three and nine months ended September 30, 2022 and 2021, by type of modification. Consumer Real Estate – Modification Programs TDRs Entered into During the Three Months Ended September 30 Nine Months Ended September 30 (Dollars in millions) 2022 2021 2022 2021 Modifications under government programs $ —  $ —  $ —  $ 4  Modifications under proprietary programs 420  417  999  740  Loans discharged in Chapter 7 bankruptcy (1) 4  9  12  29  Trial modifications 41  18  94  42  Total modifications $ 465  $ 444  $ 1,105  $ 815  (1)Includes loans discharged in Chapter 7 bankruptcy with no change in repayment terms that are classified as TDRs. The following table presents the carrying value of consumer real estate loans that entered into payment default during the three and nine months ended September 30, 2022 and 2021 that were modified in a TDR during the 12 months preceding payment default. A payment default for consumer real estate TDRs is recognized when a borrower has missed three monthly payments (not necessarily consecutively) since modification. Consumer Real Estate – TDRs Entering Payment Default that were Modified During the Preceding 12 Months Three Months Ended September 30 Nine Months Ended September 30 (Dollars in millions) 2022 2021 2022 2021 Modifications under government programs $ —  $ 1  $ —  $ 3  Modifications under proprietary programs 63  35  135  80  Loans discharged in Chapter 7 bankruptcy (1) 1  1  2  6  Trial modifications (2) 8  3  19  15  Total modifications $ 72  $ 40  $ 156  $ 104  (1)Includes loans discharged in Chapter 7 bankruptcy with no change in repayment terms that are classified as TDRs. (2)Includes trial modification offers to which the customer did not respond. Credit Card and Other Consumer The Corporation seeks to assist customers who are experiencing financial difficulty by modifying loans while ensuring compliance with federal and local laws and guidelines. Credit card and other consumer loan modifications generally involve reducing the interest rate on the account, placing the customer on a fixed payment plan not exceeding 60 months and canceling the customer’s available line of credit, all of which are considered TDRs. The Corporation makes loan modifications directly with borrowers for debt held only by the Corporation (internal programs). Additionally, the Corporation makes loan modifications for borrowers working with third-party renegotiation agencies that provide solutions to customers’ entire unsecured debt structures (external programs). The Corporation classifies other secured consumer loans that have been discharged in Chapter 7 bankruptcy as TDRs, which are written down to collateral value and placed on nonaccrual status no later than the time of discharge. The table below provides information on the Corporation’s Credit Card and Other Consumer TDR portfolio including the September 30, 2022 and 2021 unpaid principal balance, carrying value, and average pre- and post-modification interest rates of loans that were modified in TDRs during the three and nine months ended September 30, 2022 and 2021. Credit Card and Other Consumer – TDRs Entered into During the Three and Nine Months Ended September 30, 2022 and 2021   Unpaid Principal Balance Carrying Value (1) Pre-Modification Interest Rate Post-Modification Interest Rate Unpaid Principal Balance Carrying Value (1) Pre-Modification Interest Rate Post-Modification Interest Rate (Dollars in millions) Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Credit card $ 86  $ 90  21.17  % 3.80  % $ 198  $ 206  21.02  % 3.82  % Direct/Indirect consumer 2  2  5.65  5.65  5  4  5.48  5.48  Total $ 88  $ 92  20.87  3.83  $ 203  $ 210  20.69  3.86  Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 Credit card $ 66  $ 71  18.48  % 3.71  % $ 189  $ 200  18.47  % 4.26  % Direct/Indirect consumer 4  2  5.20  5.20  13  8  5.53  5.53  Total $ 70  $ 73  18.06  3.76  $ 202  $ 208  17.99  4.31  (1)Includes accrued interest and fees. The table below presents the September 30, 2022 and 2021 carrying value for Credit Card and Other Consumer loans that were modified in a TDR during the three and nine months ended September 30, 2022 and 2021 by program type. Credit Card and Other Consumer – TDRs by Program Type (1) TDRs Entered into During the Three Months Ended September 30 TDRs Entered into During the Nine Months Ended September 30 (Dollars in millions) 2022 2021 2022 2021 Internal programs $ 77  $ 60  $ 174  $ 166  External programs 13  11  32  37  Other 2  2  4  5  Total $ 92  $ 73  $ 210  $ 208  (1) Includes accrued interest and fees. Credit card and other consumer loans are deemed to be in payment default during the quarter in which a borrower misses the second of two consecutive payments. Payment defaults are one of the factors considered when projecting future cash flows in the calculation of the allowance for loan and lease losses for credit card and other consumer. Based on historical experience, the Corporation estimates that 12 percent of new credit card TDRs and 20 percent of new direct/indirect consumer TDRs may be in payment default within 12 months after modification. Commercial Loans Modifications of loans to commercial borrowers that are experiencing financial difficulty are designed to reduce the Corporation’s loss exposure while providing the borrower with an opportunity to work through financial difficulties, often to avoid foreclosure or bankruptcy. Each modification is unique and reflects the individual circumstances of the borrower. Modifications that result in a TDR may include extensions of maturity at a concessionary (below market) rate of interest, payment forbearances or other actions designed to benefit the borrower while mitigating the Corporation’s risk exposure. Reductions in interest rates are rare. Instead, the interest rates are typically increased, although the increased rate may not represent a market rate of interest. Infrequently, concessions may also include principal forgiveness in connection with foreclosure, short sale or other settlement agreements leading to termination or sale of the loan. At the time of restructuring, the loans are remeasured to reflect the impact, if any, on projected cash flows resulting from the modified terms. If a portion of the loan is deemed to be uncollectible, a charge-off may be recorded at the time of restructuring. Alternatively, a charge-off may have already been recorded in a previous period such that no charge-off is required at the time of modification. During the three and nine months ended September 30, 2022, the carrying value of the Corporation’s commercial loans that were modified as TDRs was $745 million and $1.7 billion compared to $213 million and $1.1 billion for the same periods in 2021. At September 30, 2022 and December 31, 2021, the Corporation had commitments to lend $347 million and $283 million to commercial borrowers whose loans were classified as TDRs. The balance of commercial TDRs in payment default was $117 million and $262 million at September 30, 2022 and December 31, 2021. Loans Held-for-sale The Corporation had LHFS of $7.6 billion and $15.6 billion at September 30, 2022 and December 31, 2021. Cash and non-cash proceeds from sales and paydowns of loans originally classified as LHFS were $27.8 billion and $27.0 billion for the nine months ended September 30, 2022 and 2021. Cash used for originations and purchases of LHFS totaled $18.7 billion and $27.0 billion for the nine months ended September 30, 2022 and 2021. Also included were non-cash net transfers into LHFS of $2.1 billion for the nine months ended September 30, 2022, primarily driven by the transfer of a $1.6 billion affinity card loan portfolio to held for sale that was sold in October 2022, and $804 million for the nine months ended September 30, 2021. Accrued Interest Receivable Accrued interest receivable for loans and leases and loans held-for-sale at September 30, 2022 and December 31, 2021 was $3.0 billion and $2.2 billion and is reported in customer and other receivables on the Consolidated Balance Sheet. Outstanding credit card loan balances include unpaid principal, interest and fees. Credit card loans are not classified as nonperforming but are charged off no later than the end of the month in which the account becomes 180 days past due, within 60 days after receipt of notification of death or bankruptcy, or upon confirmation of fraud. During the three and nine months ended September 30, 2022, the Corporation reversed $81 million and $241 million of interest and fee income against the income statement line item in which it was originally recorded upon charge-off of the principal balance of the loan compared to $87 million and $369 million for the same periods in 2021. For the outstanding residential mortgage, home equity, direct/indirect consumer and commercial loan balances classified as nonperforming during the three and nine months ended September 30, 2022 and 2021, interest and fee income reversed at the time the loans were classified as nonperforming was not significant. For more information on the Corporation's nonperforming loan policies, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation’s 2021 Annual Report on Form 10-K Allowance for Credit Losses The allowance for credit losses is estimated using quantitative and qualitative methods that consider a variety of factors, such as historical loss experience, the current credit quality of the portfolio and an economic outlook over the life of the loan. Qualitative reserves cover losses that are expected but, in the Corporation's assessment, may not be adequately reflected in the quantitative methods or the economic assumptions. The Corporation incorporates forward-looking information through the use of several macroeconomic scenarios in determining the weighted economic outlook over the forecasted life of the assets. These scenarios include key macroeconomic variables such as gross domestic product, unemployment rate, real estate prices and corporate bond spreads. The scenarios that are chosen each quarter and the weighting given to each scenario depend on a variety of factors including recent economic events, leading economic indicators, internal and third-party economist views, and industry trends. For more information on the Corporation's credit loss accounting policies including the allowance for credit losses, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation’s 2021 Annual Report on Form 10-K. The September 30, 2022 estimate for allowance for credit losses was based on various economic outlooks that included a baseline scenario derived from consensus estimates, a moderate recession scenario, a downside scenario to account for persistent inflation and interest rates at levels above what is factored into the baseline, and a tail risk scenario. In addition, an upside scenario considers the potential for improvement in the consensus outlooks. The weighted economic outlook assumes that the U.S. average unemployment rate will be above five percent in the fourth quarter of 2023 and fall just below five percent by the end of 2024. Additionally, in this economic outlook, U.S. gross domestic product is forecasted to grow at 0.2 percent and 1.5 percent year-over-year in the fourth quarters of 2023 and 2024. While asset quality continues to improve and the pandemic appears to have largely dissipated, uncertainty remains regarding broader economic impacts as a result of inflationary pressures, rising rates and the current geopolitical situation and could lead to adverse impacts to credit quality metrics in future periods. As such, the Corporation has factored the aforementioned uncertainties into its allowance for credit losses. The allowance for credit losses at September 30, 2022 was $13.8 billion, a decrease of $26 million compared to December 31, 2021. The decrease in the allowance for credit losses was primarily driven by asset quality improvement and reduced pandemic uncertainties, partially offset by reserve builds related to loan growth, a dampening macroeconomic outlook and Russian exposure. The change in the allowance for credit losses was comprised of a net decrease of $85 million in the allowance for loan and lease losses and a $59 million increase in the reserve for unfunded lending commitments. The decrease in the allowance for credit losses was attributed to $191 million in the consumer real estate portfolio, partially offset by an increase of $20 million in the credit card and other consumer portfolio, and an increase of $145 million in the commercial portfolio. The provision for credit losses increased $1.5 billion to an expense of $898 million, and $5.6 billion to an expense of $1.5 billion for the three and nine months ended September 30, 2022 compared to the same periods in 2021. The provision for credit losses for the three months ended September 30, 2022 was primarily driven by loan growth and a dampening macroeconomic outlook, and the nine-month period was driven by the same factors as well as a reserve build related to Russian exposure, partially offset by asset quality improvement and reduced pandemic uncertainties. For the same periods in the prior year, the benefit in the provision for credit losses was due to an improved macroeconomic outlook. Outstanding loans and leases excluding loans accounted for under the fair value option increased $56.3 billion during the nine months ended September 30, 2022 driven by commercial loans, which increased $40.9 billion, driven by broad-based growth, and consumer loans, which increased $15.4 billion, primarily driven by residential mortgage and credit card. The changes in the allowance for credit losses, including net charge-offs and provision for loan and lease losses, are detailed in the table below. Consumer Real Estate Credit Card and  Other Consumer Commercial Total (Dollars in millions) Three Months Ended September 30, 2022 Allowance for loan and lease losses, July 1 $ 396  $ 6,216  $ 5,361  $ 11,973  Loans and leases charged off (13) (696) (100) (809) Recoveries of loans and leases previously charged off 34  216  39  289  Net charge-offs 21  (480) (61) (520) Provision for loan and lease losses (37) 760  122  845  Other 4  —  —  4  Allowance for loan and lease losses, September 30 384  6,496  5,422  12,302  Reserve for unfunded lending commitments, July 1 79  —  1,382  1,461  Provision for unfunded lending commitments (1) —  54  53  Other —  —  1  1  Reserve for unfunded lending commitments, September 30 78  —  1,437  1,515  Allowance for credit losses, September 30 $ 462  $ 6,496  $ 6,859  $ 13,817  Three Months Ended September 30, 2021 Allowance for loan and lease losses, July 1 $ 597  $ 6,835  $ 6,663  $ 14,095  Loans and leases charged off (15) (626) (165) (806) Recoveries of loans and leases previously charged off 56  256  31  343  Net charge-offs 41  (370) (134) (463) Provision for loan and lease losses (85) 175  (565) (475) Other 2  (1) (3) (2) Allowance for loan and lease losses, September 30 555  6,639  5,961  13,155  Reserve for unfunded lending commitments, July 1 107  —  1,580  1,687  Provision for unfunded lending commitments (9) —  (140) (149) Reserve for unfunded lending commitments, September 30 98  —  1,440  1,538  Allowance for credit losses, September 30 $ 653  $ 6,639  $ 7,401  $ 14,693  (Dollars in millions) Nine Months Ended September 30, 2022 Allowance for loan and lease losses, January 1 $ 557  $ 6,476  $ 5,354  $ 12,387  Loans and leases charged off (196) (2,007) (284) (2,487) Recoveries of loans and leases previously charged off 195  684  125  1,004  Net charge-offs (1) (1,323) (159) (1,483) Provision for loan and lease losses (179) 1,344  229  1,394  Other 7  (1) (2) 4  Allowance for loan and lease losses, September 30 384  6,496  5,422  12,302  Reserve for unfunded lending commitments, January 1 96  —  1,360  1,456  Provision for unfunded lending commitments (18) —  75  57  Other —  —  2  2  Reserve for unfunded lending commitments, September 30 78  —  1,437  1,515  Allowance for credit losses, September 30 $ 462  $ 6,496  $ 6,859  $ 13,817  Nine Months Ended September 30, 2021 Allowance for loan and lease losses, January 1 $ 858  $ 9,213  $ 8,731  $ 18,802  Loans and leases charged off (60) (2,402) (591) (3,053) Recoveries of loans and leases previously charged off 170  757  245  1,172  Net charge-offs 110  (1,645) (346) (1,881) Provision for loan and lease losses (414) (929) (2,423) (3,766) Other 1  —  (1) —  Allowance for loan and lease losses, September 30 555  6,639  5,961  13,155  Reserve for unfunded lending commitments, January 1 137  —  1,741  1,878  Provision for unfunded lending commitments (39) —  (300) (339) Other —  —  (1) (1) Reserve for unfunded lending commitments, September 30 98  —  1,440  1,538  Allowance for credit losses, September 30 $ 653  $ 6,639  $ 7,401  $ 14,693