Outstanding Loans and Leases and Allowance for Credit Losses

v3.23.1

Outstanding Loans and Leases and Allowance for Credit Losses	3 Months Ended
	Mar. 31, 2023
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 March 31, 2023 and December 31, 2022. 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) March 31, 2023 Consumer real estate             Residential mortgage $ 938  $ 255  $ 894  $ 2,087  $ 226,740  $ 228,827  Home equity 93  34  189  316  25,552  25,868  Credit card and other consumer Credit card 500  346  828  1,674  90,795  92,469  Direct/Indirect consumer (2) 206  78  61  345  104,195  104,540  Other consumer —  —  —  —  120  120  Total consumer 1,737  713  1,972  4,422  447,402  451,824  Consumer loans accounted for under the fair value option (3) $ 334  334  Total consumer loans and leases 1,737  713  1,972  4,422  447,402  334  452,158  Commercial U.S. commercial 892  156  281  1,329  359,326  360,655  Non-U.S. commercial 124  33  133  290  124,537  124,827  Commercial real estate (4) 257  15  114  386  72,665  73,051  Commercial lease financing 46  12  9  67  13,381  13,448  U.S. small business commercial (5) 109  68  262  439  17,765  18,204  Total commercial 1,428  284  799  2,511  587,674  590,185  Commercial loans accounted for under the fair value option (3) 4,063  4,063  Total commercial loans and leases 1,428  284  799  2,511  587,674  4,063  594,248  Total loans and leases (6) $ 3,165  $ 997  $ 2,771  $ 6,933  $ 1,035,076  $ 4,397  $ 1,046,406  Percentage of outstandings 0.30  % 0.10  % 0.26  % 0.66  % 98.92  % 0.42  % 100.00  % (1)Consumer real estate loans 30-59 days past due includes fully-insured loans of $172 million and nonperforming loans of $157 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $69 million and nonperforming loans of $103 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $338 million and nonperforming loans of $745 million. Consumer real estate loans current or less than 30 days past due includes $1.6 billion, and direct/indirect consumer includes $29 million of nonperforming loans. (2)Total outstandings primarily includes auto and specialty lending loans and leases of $52.7 billion, U.S. securities-based lending loans of $48.1 billion and non-U.S. consumer loans of $2.8 billion. (3)Consumer loans accounted for under the fair value option includes residential mortgage loans of $72 million and home equity loans of $262 million. Commercial loans accounted for under the fair value option includes U.S. commercial loans of $2.2 billion and non-U.S. commercial loans of $1.9 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 $67.2 billion and non-U.S. commercial real estate loans of $5.8 billion. (5)Includes Paycheck Protection Program loans. (6)Total outstandings includes loans and leases pledged as collateral of $43.5 billion. The Corporation also pledged $243.8 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, 2022 Consumer real estate             Residential mortgage $ 1,077  $ 245  $ 945  $ 2,267  $ 227,403  $ 229,670  Home equity 88  32  211  331  26,232  26,563  Credit card and other consumer           Credit card 466  322  717  1,505  91,916    93,421  Direct/Indirect consumer (2) 204  59  45  308  105,928    106,236  Other consumer  —  —  —  —  156    156  Total consumer 1,835  658  1,918  4,411  451,635  456,046  Consumer loans accounted for under the fair value option (3) $ 339  339  Total consumer loans and leases 1,835  658  1,918  4,411  451,635  339  456,385  Commercial               U.S. commercial 827  288  330  1,445  357,036    358,481  Non-U.S. commercial 317  59  144  520  123,959    124,479  Commercial real estate (4) 409  81  77  567  69,199    69,766  Commercial lease financing 49  9  11  69  13,575    13,644  U.S. small business commercial (5) 107  63  356  526  17,034    17,560  Total commercial 1,709  500  918  3,127  580,803    583,930  Commercial loans accounted for under the fair value option (3) 5,432  5,432  Total commercial loans and leases 1,709  500  918  3,127  580,803  5,432  589,362  Total loans and leases (6) $ 3,544  $ 1,158  $ 2,836  $ 7,538  $ 1,032,438  $ 5,771  $ 1,045,747  Percentage of outstandings 0.34  % 0.11  % 0.27  % 0.72  % 98.73  % 0.55  % 100.00  % (1)Consumer real estate loans 30-59 days past due includes fully-insured loans of $184 million and nonperforming loans of $155 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $75 million and nonperforming loans of $88 million. Consumer real estate loans 90 days or more past due includes fully-insured loans of $368 million and nonperforming loans of $788 million. Consumer real estate loans current or less than 30 days past due includes $1.6 billion, and direct/indirect consumer includes $27 million of nonperforming loans. (2)Total outstandings primarily includes auto and specialty lending loans and leases of $51.8 billion, U.S. securities-based lending loans of $50.4 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 $71 million and home equity loans of $268 million. Commercial loans accounted for under the fair value option includes U.S. commercial loans of $2.9 billion and non-U.S. commercial loans of $2.5 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 $64.9 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 $18.5 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. The Corporation has entered into long-term credit protection agreements with FNMA and FHLMC on loans totaling $9.3 billion and $9.5 billion at March 31, 2023 and December 31, 2022, 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 increased to $1.2 billion at March 31, 2023 from $1.1 billion at December 31, 2022, driven by the commercial real estate office property type. Consumer nonperforming loans decreased to $2.7 billion at March 31, 2023 from $2.8 billion at December 31, 2022 primarily due to decreases from consumer real estate loans as returns to performing status and paydowns more than offset new additions. The following table presents the Corporation’s nonperforming loans and leases and loans accruing past due 90 days or more at March 31, 2023 and December 31, 2022. Nonperforming 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 2022 Annual Report on Form 10-K. Credit Quality Nonperforming Loans and Leases Accruing Past Due 90 Days or More (Dollars in millions) March 31 2023 December 31 2022 March 31 2023 December 31 2022 Residential mortgage (1) $ 2,125  $ 2,167  $ 338  $ 368  With no related allowance (2) 1,935  1,973  —  —  Home equity (1) 488  510  —  —  With no related allowance (2) 396  393  —  —  Credit Card                      n/a                     n/a 828  717  Direct/indirect consumer 101  77  2  2  Total consumer 2,714  2,754  1,168  1,087  U.S. commercial 559  553  112  190  Non-U.S. commercial 125  212  92  25  Commercial real estate 502  271  35  46  Commercial lease financing 4  4  6  8  U.S. small business commercial 14  14  261  355  Total commercial 1,204  1,054  506  624  Total nonperforming loans $ 3,918  $ 3,808  $ 1,674  $ 1,711  Percentage of outstanding loans and leases 0.38  % 0.37  % 0.16  % 0.16  % (1)Residential mortgage loans accruing past due 90 days or more are fully-insured loans. At March 31, 2023 and December 31, 2022 residential mortgage included $232 million and $260 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 $108 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 2022 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 and gross charge-offs for the Corporation's Consumer Real Estate, Credit Card and Other Consumer, and Commercial portfolio segments by year of origination, except for revolving loans and revolving loans that were modified into term loans, which are shown on an aggregate basis at March 31, 2023. Residential Mortgage – Credit Quality Indicators By Vintage Term Loans by Origination Year (Dollars in millions) Total as of March 31,  2023 2023 2022 2021 2020 2019 Prior Residential Mortgage Refreshed LTV       Less than or equal to 90 percent $ 214,159  $ 3,115  $ 39,127  $ 79,059  $ 37,281  $ 18,552  $ 37,025  Greater than 90 percent but less than or equal to 100 percent 2,352  196  1,404  612  96  19  25  Greater than 100 percent 934  105  479  240  46  16  48  Fully-insured loans 11,382  44  464  3,624  3,033  924  3,293  Total Residential Mortgage $ 228,827  $ 3,460  $ 41,474  $ 83,535  $ 40,456  $ 19,511  $ 40,391  Residential Mortgage Refreshed FICO score Less than 620 $ 2,112  $ 21  $ 385  $ 519  $ 357  $ 109  $ 721  Greater than or equal to 620 and less than 680 4,885  68  1,082  1,266  818  327  1,324  Greater than or equal to 680 and less than 740 23,704  309  5,033  7,482  4,046  2,033  4,801  Greater than or equal to 740 186,744  3,018  34,510  70,644  32,202  16,118  30,252  Fully-insured loans 11,382  44  464  3,624  3,033  924  3,293  Total Residential Mortgage $ 228,827  $ 3,460  $ 41,474  $ 83,535  $ 40,456  $ 19,511  $ 40,391  Gross charge-offs $ 8  $ —  $ 3  $ 1  $ 1  $ —  $ 3  Home Equity - Credit Quality Indicators Total Home Equity Loans and Reverse Mortgages (1) Revolving Loans Revolving Loans Converted to Term Loans (Dollars in millions) March 31, 2023 Home Equity Refreshed LTV       Less than or equal to 90 percent $ 25,692  $ 1,238  $ 19,627  $ 4,827  Greater than 90 percent but less than or equal to 100 percent 72  21  35  16  Greater than 100 percent 104  36  38  30  Total Home Equity $ 25,868  $ 1,295  $ 19,700  $ 4,873  Home Equity Refreshed FICO score Less than 620 $ 677  $ 167  $ 197  $ 313  Greater than or equal to 620 and less than 680 1,138  144  504  490  Greater than or equal to 680 and less than 740 4,186  292  2,728  1,166  Greater than or equal to 740 19,867  692  16,271  2,904  Total Home Equity $ 25,868  $ 1,295  $ 19,700  $ 4,873  Gross charge-offs $ 6  $ 1  $ 3  $ 2  (1)Includes reverse mortgages of $893 million and home equity loans of $402 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 March 31, 2023 Revolving Loans 2023 2022 2021 2020 2019 Prior Total Credit Card as of March 31, 2023 Revolving Loans Revolving Loans Converted to Term Loans (1) Refreshed FICO score     Less than 620 $ 940  $ 12  $ 32  $ 308  $ 318  $ 113  $ 76  $ 81  $ 4,268  $ 4,052  $ 216  Greater than or equal to 620 and less than 680 2,463  11  245  1,022  707  225  121  132  10,732  10,526  206  Greater than or equal to 680 and less than 740 8,693  49  1,059  3,563  2,375  821  422  404  31,858  31,673  185  Greater than or equal to 740 40,766  77  5,101  15,273  10,501  4,837  2,527  2,450  45,611  45,566  45  Other internal credit    metrics (2,3) 51,678  50,942  52  181  191  63  59  190  —  —  —  Total credit card and other    consumer $ 104,540  $ 51,091  $ 6,489  $ 20,347  $ 14,092  $ 6,059  $ 3,205  $ 3,257  $ 92,469  $ 91,817  $ 652  Gross charge-offs $ 40  $ 1  $ —  $ 17  $ 11  $ 4  $ 2  $ 5  $ 650  $ 633  $ 17  (1)Represents loans that were modified into term loans. (2)Other internal credit metrics may include delinquency status, geography or other factors. (3)Direct/indirect consumer includes $50.9 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 March 31, 2023. Commercial – Credit Quality Indicators By Vintage (1) Term Loans Amortized Cost Basis by Origination Year (Dollars in millions) Total as of March 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans U.S. Commercial Risk ratings         Pass rated $ 350,224  $ 9,255  $ 55,496  $ 33,787  $ 17,310  $ 15,264  $ 37,296  $ 181,816  Reservable criticized 10,431  49  605  803  582  885  1,925  5,582  Total U.S. Commercial $ 360,655  $ 9,304  $ 56,101  $ 34,590  $ 17,892  $ 16,149  $ 39,221  $ 187,398  Gross charge-offs $ 59  $ —  $ 3  $ 18  $ —  $ —  $ 5  $ 33  Non-U.S. Commercial Risk ratings Pass rated $ 122,545  $ 4,204  $ 19,937  $ 18,102  $ 4,634  $ 3,736  $ 6,585  $ 65,347  Reservable criticized 2,282  81  144  321  277  254  225  980  Total Non-U.S. Commercial $ 124,827  $ 4,285  $ 20,081  $ 18,423  $ 4,911  $ 3,990  $ 6,810  $ 66,327  Gross charge-offs $ 23  $ —  $ —  $ 8  $ 7  $ 1  $ —  $ 7  Commercial Real Estate Risk ratings Pass rated $ 67,512  $ 1,856  $ 16,836  $ 13,350  $ 5,281  $ 8,861  $ 12,414  $ 8,914  Reservable criticized 5,539  —  11  829  538  1,737  2,217  207  Total Commercial Real Estate $ 73,051  $ 1,856  $ 16,847  $ 14,179  $ 5,819  $ 10,598  $ 14,631  $ 9,121  Gross charge-offs $ 24  $ —  $ —  $ —  $ —  $ 13  $ 11  $ —  Commercial Lease Financing Risk ratings Pass rated $ 13,227  $ 613  $ 3,208  $ 2,576  $ 1,775  $ 1,428  $ 3,627  $ —  Reservable criticized 221  —  20  43  17  36  105  —  Total Commercial Lease Financing $ 13,448  $ 613  $ 3,228  $ 2,619  $ 1,792  $ 1,464  $ 3,732  $ —  Gross charge-offs $ —  $ —  $ —  $ —  $ —  $ —  $ —  $ —  U.S. Small Business Commercial (2) Risk ratings Pass rated $ 8,653  $ 453  $ 1,806  $ 1,833  $ 1,209  $ 826  $ 2,401  $ 125  Reservable criticized 352  —  22  52  52  72  151  3  Total U.S. Small Business Commercial $ 9,005  $ 453  $ 1,828  $ 1,885  $ 1,261  $ 898  $ 2,552  $ 128  Gross charge-offs $ 13  $ —  $ —  $ —  $ 8  $ 1  $ 1  $ 3  Total $ 580,986  $ 16,511  $ 98,085  $ 71,696  $ 31,675  $ 33,099  $ 66,946  $ 262,974  Total gross charge-offs $ 119  $ —  $ 3  $ 26  $ 15  $ 15  $ 17  $ 43  (1) Excludes $4.1 billion of loans accounted for under the fair value option at March 31, 2023. (2)     Excludes U.S. Small Business Card loans of $9.2 billion. Refreshed FICO scores for this portfolio are $360 million for less than 620; $931 million for greater than or equal to 620 and less than 680; $2.5 billion for greater than or equal to 680 and less than 740; and $5.4 billion greater than or equal to 740. Excludes U.S. Small Business Card loans gross charge-offs of $62 million. 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 year of origination, except for revolving loans and revolving loans that were modified into term loans, which are shown on an aggregate basis at December 31, 2022. Residential Mortgage – Credit Quality Indicators By Vintage Term Loans by Origination Year (Dollars in millions) Total as of  December 31,  2022 2022 2021 2020 2019 2018 Prior Residential Mortgage Refreshed LTV Less than or equal to 90 percent $ 215,713  $ 39,625  $ 81,437  $ 37,228  $ 18,980  $ 5,734  $ 32,709  Greater than 90 percent but less than or equal to 100 percent 1,615  950  530  93  15  8  19  Greater than 100 percent 648  374  169  43  15  8  39  Fully-insured loans 11,694  580  3,667  3,102  949  156  3,240  Total Residential Mortgage $ 229,670  $ 41,529  $ 85,803  $ 40,466  $ 19,959  $ 5,906  $ 36,007  Residential Mortgage Refreshed FICO score Less than 620 $ 2,156  $ 377  $ 518  $ 373  $ 124  $ 84  $ 680  Greater than or equal to 620 and less than 680 4,978  1,011  1,382  840  329  233  1,183  Greater than or equal to 680 and less than 740 25,444  5,411  8,290  4,369  2,187  830  4,357  Greater than or equal to 740 185,398  34,150  71,946  31,782  16,370  4,603  26,547  Fully-insured loans 11,694  580  3,667  3,102  949  156  3,240  Total Residential Mortgage $ 229,670  $ 41,529  $ 85,803  $ 40,466  $ 19,959  $ 5,906  $ 36,007  Gross charge-offs $ 161  $ —  $ 6  $ 5  $ 6  $ 1  $ 143  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, 2022 Home Equity Refreshed LTV Less than or equal to 90 percent $ 26,395  $ 1,304  $ 19,960  $ 5,131  Greater than 90 percent but less than or equal to 100 percent 62  20  24  18  Greater than 100 percent 106  37  35  34  Total Home Equity $ 26,563  $ 1,361  $ 20,019  $ 5,183  Home Equity Refreshed FICO score Less than 620 $ 683  $ 166  $ 189  $ 328  Greater than or equal to 620 and less than 680 1,190  152  507  531  Greater than or equal to 680 and less than 740 4,321  312  2,747  1,262  Greater than or equal to 740 20,369  731  16,576  3,062  Total Home Equity $ 26,563  $ 1,361  $ 20,019  $ 5,183  Gross charge-offs $ 45  $ 5  $ 24  $ 16  (1)Includes reverse mortgages of $937 million and home equity loans of $424 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, 2022 Revolving Loans 2022 2021 2020 2019 2018 Prior Total Credit Card as of December 31, 2022 Revolving Loans Revolving Loans Converted to Term Loans (1) Refreshed FICO score Less than 620 $ 847  $ 12  $ 237  $ 301  $ 113  $ 84  $ 43  $ 57  $ 4,056  $ 3,866  $ 190  Greater than or equal to 620 and less than 680 2,521  12  1,108  816  269  150  69  97  10,994  10,805  189  Greater than or equal to 680 and less than 740 8,895  52  4,091  2,730  992  520  214  296  32,186  32,017  169  Greater than or equal to 740 39,679  83  16,663  11,392  5,630  2,992  1,236  1,683  46,185  46,142  43  Other internal credit    metrics (2, 3) 54,294  53,404  259  305  70  57  40  159  —  —  —  Total credit card and other    consumer $ 106,236  $ 53,563  $ 22,358  $ 15,544  $ 7,074  $ 3,803  $ 1,602  $ 2,292  $ 93,421  $ 92,830  $ 591  Gross charge-offs $ 232  $ 7  $ 31  $ 79  $ 34  $ 27  $ 14  $ 40  $ 1,985  $ 1,909  $ 76  (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 $53.4 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, 2022. Commercial – Credit Quality Indicators By Vintage (1) Term Loans Amortized Cost Basis by Origination Year (Dollars in millions) Total as of December 31, 2022 2022 2021 2020 2019 2018 Prior Revolving Loans U.S. Commercial Risk ratings         Pass rated $ 348,447  $ 61,200  $ 39,717  $ 18,609  $ 16,566  $ 8,749  $ 30,282  $ 173,324  Reservable criticized 10,034  278  794  697  884  1,202  856  5,323  Total U.S. Commercial $ 358,481  $ 61,478  $ 40,511  $ 19,306  $ 17,450  $ 9,951  $ 31,138  $ 178,647  Gross charge-offs $ 151  $ 2  $ 24  $ 24  $ 9  $ 6  $ 13  $ 73  Non-U.S. Commercial Risk ratings Pass rated $ 121,890  $ 24,839  $ 19,098  $ 5,183  $ 3,882  $ 2,423  $ 4,697  $ 61,768  Reservable criticized 2,589  45  395  331  325  98  475  920  Total Non-U.S. Commercial $ 124,479  $ 24,884  $ 19,493  $ 5,514  $ 4,207  $ 2,521  $ 5,172  $ 62,688  Gross charge-offs $ 41  $ —  $ 3  $ 1  $ —  $ 37  $ —  $ —  Commercial Real Estate Risk ratings Pass rated $ 64,619  $ 15,290  $ 13,089  $ 5,756  $ 9,013  $ 4,384  $ 8,606  $ 8,481  Reservable criticized 5,147  11  837  545  1,501  1,151  1,017  85  Total Commercial Real Estate $ 69,766  $ 15,301  $ 13,926  $ 6,301  $ 10,514  $ 5,535  $ 9,623  $ 8,566  Gross charge-offs $ 75  $ —  $ —  $ 6  $ —  $ 26  $ 43  $ —  Commercial Lease Financing Risk ratings Pass rated $ 13,404  $ 3,255  $ 2,757  $ 1,955  $ 1,578  $ 1,301  $ 2,558  $ —  Reservable criticized 240  9  35  12  71  50  63  —  Total Commercial Lease Financing $ 13,644  $ 3,264  $ 2,792  $ 1,967  $ 1,649  $ 1,351  $ 2,621  $ —  Gross charge-offs $ 8  $ —  $ 4  $ —  $ 4  $ —  $ —  $ —  U.S. Small Business Commercial (2) Risk ratings Pass rated $ 8,726  $ 1,825  $ 1,953  $ 1,408  $ 864  $ 624  $ 1,925  $ 127  Reservable criticized 329  11  35  48  76  51  105  3  Total U.S. Small Business Commercial $ 9,055  $ 1,836  $ 1,988  $ 1,456  $ 940  $ 675  $ 2,030  $ 130  Gross charge-offs $ 31  $ —  $ 1  $ 11  $ 4  $ 1  $ 6  $ 8   Total $ 575,425  $ 106,763  $ 78,710  $ 34,544  $ 34,760  $ 20,033  $ 50,584  $ 250,031  Total gross charge-offs $ 306  $ 2  $ 32  $ 42  $ 17  $ 70  $ 62  $ 81  (1) Excludes $5.4 billion of loans accounted for under the fair value option at December 31, 2022. (2) Excludes U.S. Small Business Card loans of $8.5 billion. Refreshed FICO scores for this portfolio are $297 million for less than 620; $859 million for greater than or equal to 620 and less than 680; $2.4 billion for greater than or equal to 680 and less than 740; and $5.0 billion greater than or equal to 740. Excludes U.S. Small Business Card loans gross charge-offs of $172 million. During the three months ended March 31, 2023, commercial reservable criticized utilized exposure increased to $19.8 billion at March 31, 2023 from $19.3 billion (to 3.17 percent from 3.12 percent of total commercial reservable utilized exposure) at December 31, 2022, primarily driven by our U.S. commercial and industrial portfolio as well as commercial real estate. Loan Modifications to Borrowers in Financial Difficulty As part of its credit risk management, the Corporation may modify a loan agreement with a borrower experiencing financial difficulties through a refinancing or restructuring of the borrower’s loan agreement (modification programs). Consumer Real Estate The following modification programs are offered for consumer real estate loans to borrowers experiencing financial difficulties. These modifications represented 0.09 percent and 0.15 percent of outstanding residential mortgage and home equity loans at March 31, 2023. Forbearance and Other Payment Plans: Forbearance plans generally consist of the Corporation suspending the borrower’s payments for a defined period with those payments then due at the conclusion of the forbearance period. The aging status of a loan is generally frozen when it enters into a forbearance plan. Alternatively, the Corporation may offer the borrower a payment plan, which allows the borrower to repay past due amounts through payments over a defined period. At March 31, 2023, the amortized cost of residential mortgage and home equity loans that were modified through these plans during the three months ended March 31, 2023 was $158 million and $30 million. The weighted-average duration of these modifications was 8.2 months and 8.9 months. The total forborne payments for these modifications was $7 million and $3 million for residential mortgage and home equity loans. If a borrower is unable to fulfill their obligations under the forbearance plans, they may be offered a trial or permanent modification. Trial Modifications: Trial modification plans generally consist of the Corporation offering a borrower modified loan terms that reduce their contractual payments temporarily over a three-to-four-month trial period. If the customer successfully makes the modified payments during the trial period and formally accepts the modified terms, the modified loan terms become permanent. At March 31, 2023, the amortized cost of residential mortgage and home equity loans entering trial modifications during the three months ended March 31, 2023 was $21 million and $9 million. Permanent Modifications: Permanent modifications include borrowers that have completed a trial modification and have had their contractual payment terms permanently modified, as well as borrowers that proceed directly to a permanent modification without a trial period. In a permanent modification, the borrower’s payment terms are typically modified in more than one manner but generally include a term extension and an interest rate reduction. At times, the permanent modification may also include principal forgiveness and/or a deferral of past due principal and interest amounts to the end of the loan term. The combinations utilized are based on modifying the terms that give the borrower an improved ability to meet the contractual obligations. At March 31, 2023, the amortized cost of residential mortgage and home equity loans that were granted a permanent modification during the three months ended March 31, 2023 was $47 million and $10 million. The term extensions granted for residential mortgage and home equity permanent modifications vary widely and can be up to 30 years, but are mostly in the range of 1 to 10 years and 1 to 15 years. The weighted-average term extension of permanent modifications for residential mortgage and home equity loans was 7.7 years and 12.1 years, while the weighted-average interest rate reduction was 1.50 percent and 2.37 percent. Principal forgiveness and payment deferrals were insignificant for the three months ended March 31, 2023. For consumer real estate borrowers in financial difficulty that received a forbearance, trial or permanent modification, there were no commitments to lend additional funds at March 31, 2023. Borrowers with a home equity line of credit that received a forbearance plan could have all or a portion of their lines reinstated in the future if they cure their payment default and meet certain Bank conditions. Chapter 7 Discharges: If a borrower’s consumer real estate obligation is discharged in a Chapter 7 bankruptcy proceeding, the contractual payment terms of the loan are not modified, although they can no longer be enforced against the individual borrower. The Corporation’s ability to collect amounts due on the loan is limited to enforcement against the property through the foreclosure and sale of the collateral. The Corporation will only pursue foreclosure upon default by the borrower, and otherwise will recover pursuant to the loan terms or at the time of a sale. Residential mortgage and home equity loans that were granted a Chapter 7 discharge were insignificant for the three months ended March 31, 2023. The Corporation tracks the performance of modified loans to assess effectiveness of modification programs. Defaults of modified consumer real estate loans since January 1, 2023 were insignificant during the three months ended March 31, 2023. The table below provides aging information as of March 31, 2023 for consumer real estate loans modified since January 1, 2023. Consumer Real Estate - Payment Status of Modifications to Borrowers in Financial Difficulty (1) Current 30–89 Days Past Due 90+ Days Past Due Total (Dollars in millions) March 31, 2023 Residential mortgage $ 126  $ 49  $ 30  $ 205 Home equity 23  7  10  40 Total $ 149  $ 56  $ 40  $ 245 (1)Excludes trial modifications and Chapter 7 discharges. Consumer real estate foreclosed properties totaled $117 million and $121 million at March 31, 2023 and December 31, 2022. The carrying value of consumer real estate loans, including fully-insured loans, for which formal foreclosure proceedings were in process at March 31, 2023 and December 31, 2022 was $819 million and $871 million. During the three months ended March 31, 2023 and 2022, the Corporation reclassified $37 million and $56 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. Credit Card and Other Consumer Credit card and other consumer loans are primarily modified by placing the customer on a fixed payment plan with a fixed interest rate. As of March 31, 2023, substantially all payment plans provided to customers had a 60-month term. In certain circumstances, the Corporation will forgive a portion of the outstanding balance if the borrower makes payments up to a set amount. The Corporation makes modifications directly with borrowers for loans held by the Corporation (internal programs) as well as through third-party renegotiation agencies that provide solutions to customers’ entire unsecured debt structures (external programs). The March 31, 2023 amortized cost of credit card and other consumer loans that were modified through these programs during the three months ended March 31, 2023 was $157 million. The financial effect of modifications resulted in a weighted-average interest rate reduction of 18.65 percent and principal forgiveness of $11 million. The Corporation tracks the performance of modified loans to assess the effectiveness of modification programs. Defaults of modified credit card and other consumer loans since January 1, 2023 were insignificant during the three months ended March 31, 2023. Of the $157 million in modified credit card and other consumer loans to borrowers experiencing financial difficulty as of March 31, 2023, $109 million were current, $24 million were 30-89 days past due, and $24 million were greater than 90 days past due. These modifications represented 0.08 percent of outstanding credit card and other consumer loans at March 31, 2023. Commercial Loans Modifications of loans to commercial borrowers experiencing financial difficulty are designed to reduce the Corporation’s loss exposure while providing borrowers with an opportunity to work through financial difficulties, often to avoid foreclosure or bankruptcy. Each modification is unique, reflects the borrower’s individual circumstances and is designed to benefit the borrower while mitigating the Corporation’s risk exposure. Commercial modifications are primarily term extensions and payment forbearances. Payment forbearances involve the Bank forbearing its contractual right to collect certain payments or payment in full (maturity forbearance) for a defined period of time. Reductions in interest rates and principal forgiveness occur infrequently for commercial borrowers. Principal forgiveness may occur in connection with foreclosure, short sales or other settlement agreements, leading to termination or sale of the loan. As of March 31, 2023, the amortized cost basis of modified commercial loans that were entered into during the three months ended March 31, 2023 was $822 million, including term extensions of $700 million, forbearances of $102 million and other miscellaneous modifications of $20 million. Term extensions granted during the three months ended March 31, 2023 increased the weighted-average life of the impacted loans by 1.3 years. The weighted-average duration of loan payments deferred under the Corporation’s commercial loan forbearance program was 15 months, substantially all of which were deferred over a range of 12 to 24 months. Of the $822 million in modified Commercial loans to borrowers experiencing financial difficulty as of March 31, 2023, $775 million were current, $5 million were 30-89 days past due, and $42 million were greater than 90 days past due. These modifications represented 0.14 percent of outstanding commercial loans at March 31, 2023. Defaults of modified commercial loans since January 1, 2023 were insignificant during the three months ended March 31, 2023. For the three months ended March 31, 2023, the Corporation had commitments to lend $534 million to commercial borrowers experiencing financial difficulty whose loans were modified during the period. Prior-period Troubled Debt Restructuring Disclosures Prior to adopting the new accounting standard on loan modifications, the Corporation accounted for modifications of loans to borrowers experiencing financial difficulty as TDRs, when the modification resulted in a concession. The following discussion reflects loans that were considered TDRs prior to January 1, 2023. For more information on TDR accounting policies, see Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation’s 2022 Annual Report on Form 10-K. Consumer Real Estate The following table presents the March 31, 2022 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 months ended March 31, 2022. 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. 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. At December 31, 2022, 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 – TDRs Entered into During the Three Months Ended March 31, 2022 Unpaid Principal Balance Carrying Value Pre-Modification Interest Rate Post-Modification Interest Rate (1) (Dollars in millions) March 31, 2022 Residential mortgage $ 585  $ 539  3.50  % 3.33  % Home equity 92  75  3.62  3.63  Total $ 677  $ 614  3.52  3.37  (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 March 31, 2022 carrying value for consumer real estate loans that were modified in a TDR during the three months ended March 31, 2022, by type of modification. Consumer Real Estate – Modification Programs (Dollars in millions) TDRs Entered into During the Three Months Ended March 31, 2022 Modifications under proprietary programs 552  Loans discharged in Chapter 7 bankruptcy (1) 5  Trial modifications 57  Total modifications $ 614  (1)Includes loans discharged in Chapter 7 bankruptcy with no change in repayment terms that are classified as TDRs. The table below presents the carrying value of consumer real estate loans that entered into payment default during the three months ended March 31, 2022 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 (Dollars in millions) Three Months Ended March 31, 2022 Modifications under proprietary programs 40  Loans discharged in Chapter 7 bankruptcy (1) 1  Trial modifications (2) 4  Total modifications $ 45  (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 table below provides information on the Corporation’s Credit Card and Other Consumer TDR portfolio including the March 31, 2022 unpaid principal balance, carrying value, and average pre- and post-modification interest rates of loans that were modified in TDRs during the three months ended March 31, 2022. Credit Card and Other Consumer – TDRs Entered into During the Three Months Ended March 31, 2022   Unpaid Principal Balance Carrying Value (1) Pre-Modification Interest Rate Post-Modification Interest Rate (Dollars in millions) March 31, 2022 Credit card $ 69  $ 73  18.67  % 3.69  % Direct/Indirect consumer 4  3  5.75  5.75  Total $ 73  $ 76  18.03  3.77  (1)Includes accrued interest and fees. The table below presents the March 31, 2022 carrying value for Credit Card and Other Consumer loans that were modified in a TDR during the three months ended March 31, 2022 by program type. Credit Card and Other Consumer – TDRs by Program Type (1) (Dollars in millions) TDRs Entered into During the Three Months Ended March 31, 2022 Internal programs $ 63  External programs 10  Other 3  Total $ 76  (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 10 percent of new credit card TDRs and 17 percent of new direct/indirect consumer TDRs may be in payment default within 12 months after modification. Commercial Loans During the three months ended March 31, 2022, the carrying value of the Corporation’s commercial loans that were modified as TDRs was $848 million. At December 31, 2022, the Corporation had commitments to lend $358 million to commercial borrowers whose loans were classified as TDRs. The balance of commercial TDRs in payment default was $105 million at December 31, 2022. Loans Held-for-sale The Corporation had LHFS of $6.8 billion and $6.9 billion at March 31, 2023 and December 31, 2022. Cash and non-cash proceeds from sales and paydowns of loans originally classified as LHFS were $2.4 billion and $13.3 billion for the three months ended March 31, 2023 and 2022. Cash used for originations and purchases of LHFS totaled $2.3 billion and $6.8 billion for the three months ended March 31, 2023 and 2022. Also included were non-cash net transfers into LHFS of $459 million and $1.5 billion for the three months ended March 31, 2023 and 2022. Accrued Interest Receivable Accrued interest receivable for loans and leases and loans held-for-sale at March 31, 2023 and December 31, 2022 was $4.0 billion and $3.8 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 months ended March 31, 2023 and 2022, the Corporation reversed $118 million and $131 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. For the outstanding residential mortgage, home equity, direct/indirect consumer and commercial loan balances classified as nonperforming during the three months ended March 31, 2023 and 2022, 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 2022 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 2022 Annual Report on Form 10-K. The March 31, 2023 estimate for allowance for credit losses was based on various economic scenarios, including a baseline scenario derived from consensus estimates, an adverse scenario reflecting an extended moderate recession, a downside scenario reflecting persistent inflation and interest rates above the baseline scenario, a tail risk scenario similar to the severely adverse scenario used in stress testing and an upside scenario that considers the potential for improvement above the baseline scenario. The overall economic outlook is weighted 95 percent towards a mild recessionary environment in 2023. The weighted economic outlook assumes that the U.S. average unemployment rate will be above five percent by the fourth quarter of 2023 and will remain near this level through the fourth quarter of 2024. Additionally, in this economic outlook, U.S. real gross domestic product is forecasted to contract at 0.5 percent and grow at 1.4 percent year-over-year in the fourth quarters of 2023 and 2024. For comparison, as of December 31, 2022, the weighted economic outlook for the U.S. average unemployment rate was forecasted to be just above five and a half percent by the fourth quarter of 2023 and slowly decline to five percent by the fourth quarter of 2024 and U.S. real gross domestic product was forecasted to contract at 0.4 percent and grow at 1.2 percent year-over-year in the fourth quarters of 2023 and 2024, respectively. In addition, as of March 31, 2023, the latest estimate of the year-over-year real gross domestic product growth in the fourth quarter of 2022 was 0.9 percent. For comparison, as of December 31, 2022, the year-over-year baseline real gross domestic product growth in the fourth quarter of 2022 was forecasted at 0.4 percent. The allowance for credit losses decreased $271 million from December 31, 2022 to $14.0 billion at March 31, 2023, which included a $123 million reserve increase related to the consumer portfolio and a $394 million reserve decrease related to the commercial portfolio. The decrease in the allowance reflected a reserve release in our commercial portfolio primarily driven by certain improved macroeconomic conditions, partially offset by a reserve build in our consumer portfolio primarily due to higher-than-expected credit card balances during the three months ended March 31, 2023. The decrease in allowance also includes the impact of the accounting change to remove the recognition and measurement guidance on TDRs, which reduced the allowance for credit losses by $243 million. The change in the allowance for credit losses was comprised of a net decrease of $168 million in the allowance for loan and lease losses and a decrease of $103 million in the reserve for unfunded lending commitments. The decrease in the allowance for credit losses was attributed to decreases in the commercial portfolio of $394 million and the consumer real estate portfolio of $18 million, partially offset by an increase in the credit card and other consumer portfolios of $141 million. The provision for credit losses increased $901 million to $931 million for the three months ended March 31, 2023 compared to the same period in 2022. The provision for credit losses for the three months ended March 31, 2023 was driven by our consumer portfolio primarily due to higher-than-expected credit card balances during the first quarter of 2023. This was partially offset by certain improved macroeconomic conditions that primarily benefited our commercial portfolio. Outstanding loans and leases excluding loans accounted for under the fair value option increased $2.0 billion during the three months ended March 31, 2023 primarily driven by commercial loans, which increased $6.3 billion driven by broad-based growth, and consumer loans, which decreased $4.2 billion primarily driven by securities-based lending 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 March 31, 2023 Allowance for loan and lease losses, December 31 $ 420  $ 6,817  $ 5,445  $ 12,682  January 1, 2023 adoption of credit loss standard (67) (109) (67) (243) Allowance for loan and lease losses, January 1 353  6,708  5,378  12,439  Loans and leases charged off (14) (861) (181) (1,056) Recoveries of loans and leases previously charged off 25  197  27  249  Net charge-offs 11  (664) (154) (807) Provision for loan and lease losses 34  913  (47) 900  Other 5  1  (24) (18) Allowance for loan and lease losses, March 31 403  6,958  5,153  12,514  Reserve for unfunded lending commitments, January 1 94  —  1,446  1,540  Provision for unfunded lending commitments (1) —  (102) (103) Reserve for unfunded lending commitments, March 31 93  —  1,344  1,437  Allowance for credit losses, March 31 $ 496  $ 6,958  $ 6,497  $ 13,951  Three Months Ended March 31, 2022 Allowance for loan and lease losses, January 1 $ 557  $ 6,476  $ 5,354  $ 12,387  Loans and leases charged off (23) (619) (92) (734) Recoveries of loans and leases previously charged off 63  239  40  342  Net charge-offs 40  (380) (52) (392) Provision for loan and lease losses (126) 146  88  108  Other 2  —  (1) 1  Allowance for loan and lease losses, March 31 473  6,242  5,389  12,104  Reserve for unfunded lending commitments, January 1 96  —  1,360  1,456  Provision for unfunded lending commitments (6) —  (72) (78) Other 1  —  —  1  Reserve for unfunded lending commitments, March 31 91  —  1,288  1,379  Allowance for credit losses, March 31 $ 564  $ 6,242  $ 6,677  $ 13,483