Bank of America Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Outstanding Loans and Leases (Tables)

Outstanding Loans and Leases (Tables)

6 Months Ended

Jun. 30, 2017

Schedule of Loans and Leases Outstanding

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 June 30, 2017 and December 31, 2016.

During the second quarter of 2017, the Corporation completed the sale of its non-U.S. consumer credit card business. This business, which at December 31, 2016 included $9.2 billion of non-U.S. credit card loans and the related allowance for loan and lease losses of $243 million, was presented in assets of business held for sale on the Consolidated Balance Sheet. In this Note, all applicable amounts for December 31, 2016 include these balances, unless otherwise noted. For additional information, see Note 1 – Summary of Significant Accounting Principles.




	June 30, 2017
(Dollars in millions)	30-59 Days Past Due ⁽¹⁾			60-89 Days Past Due ⁽¹⁾			90 Days or More Past Due ⁽²⁾			Total Past Due 30 Days or More			Total Current or Less Than 30 Days Past Due ⁽³⁾			Purchased Credit-impaired ⁽⁴⁾			Loans Accounted for Under the Fair Value Option			Total Outstandings
Consumer real estate
Core portfolio
Residential mortgage	$	995		$	264		$	1,029		$	2,288		$	163,921								$	166,209
Home equity	202			105			427			734			45,908									46,642
Non-core portfolio
Residential mortgage ⁽⁵⁾	1,073			519			4,113			5,705			16,258			$	9,274					31,237
Home equity	234			120			677			1,031			11,099			3,170						15,300
Credit card and other consumer
U.S. credit card	465			313			772			1,550			89,226									90,776
Direct/Indirect consumer ⁽⁶⁾	238			69			33			340			93,153									93,493
Other consumer ⁽⁷⁾	20			5			6			31			2,627									2,658
Total consumer	3,227			1,395			7,057			11,679			422,192			12,444						446,315
Consumer loans accounted for under the fair value option ⁽⁸⁾																			$	1,035		1,035
Total consumer loans and leases	3,227			1,395			7,057			11,679			422,192			12,444			1,035			447,350
Commercial
U.S. commercial	350			446			361			1,157			276,518									277,675
Commercial real estate ⁽⁹⁾	24			10			50			84			59,093									59,177
Commercial lease financing	54			72			27			153			21,675									21,828
Non-U.S. commercial	121			74			—			195			90,591									90,786
U.S. small business commercial	52			34			80			166			13,394									13,560
Total commercial	601			636			518			1,755			461,271									463,026
Commercial loans accounted for under the fair value option ⁽⁸⁾																			6,290			6,290
Total commercial loans and leases	601			636			518			1,755			461,271						6,290			469,316
Total loans and leases ⁽¹⁰⁾	$	3,828		$	2,031		$	7,575		$	13,434		$	883,463		$	12,444		$	7,325		$	916,666
Percentage of outstandings	0.42		%	0.22		%	0.83		%	1.47		%	96.38		%	1.35		%	0.80		%	100.00		%


⁽¹⁾	Consumer real estate loans 30-59 days past due includes fully-insured loans of $837 million and nonperforming loans of $250 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $435 million and nonperforming loans of $203 million.


⁽²⁾	Consumer real estate includes fully-insured loans of $3.7 billion.


⁽³⁾	Consumer real estate includes $2.3 billion and direct/indirect consumer includes $18 million of nonperforming loans.


⁽⁴⁾	Purchased credit-impaired (PCI) loan amounts are shown gross of the valuation allowance.


⁽⁵⁾	Total outstandings includes pay option loans of $1.6 billion. The Corporation no longer originates this product.


⁽⁶⁾	Total outstandings includes auto and specialty lending loans of $49.1 billion, unsecured consumer lending loans of $509 million, U.S. securities-based lending loans of $39.8 billion, non-U.S. consumer loans of $2.9 billion, student loans of $463 million and other consumer loans of $657 million.


⁽⁷⁾	Total outstandings includes consumer finance loans of $420 million, consumer leases of $2.1 billion and consumer overdrafts of $155 million.


⁽⁸⁾	Consumer loans accounted for under the fair value option were residential mortgage loans of $666 million and home equity loans of $369 million. Commercial loans accounted for under the fair value option were U.S. commercial loans of $3.2 billion and non-U.S. commercial loans of $3.1 billion. For additional information, see Note 14 – Fair Value Measurements and Note 15 – Fair Value Option.


⁽⁹⁾	Total outstandings includes U.S. commercial real estate loans of $55.6 billion and non-U.S. commercial real estate loans of $3.6 billion.


⁽¹⁰⁾	The Corporation pledged $152.8 billion of loans to secure potential borrowing capacity with the Federal Reserve Bank and Federal Home Loan Bank (FHLB). This amount is not included in the parenthetical disclosure of loans and leases pledged as collateral on the Consolidated Balance Sheet as there were no related outstanding borrowings.




	December 31, 2016
(Dollars in millions)	30-59 Days Past Due ⁽¹⁾			60-89 Days Past Due ⁽¹⁾			90 Days or More Past Due ⁽²⁾			Total Past Due 30 Days or More			Total Current or Less Than 30 Days Past Due ⁽³⁾			Purchased Credit-impaired ⁽⁴⁾			Loans Accounted for Under the Fair Value Option			Total Outstandings
Consumer real estate
Core portfolio
Residential mortgage	$	1,340		$	425		$	1,213		$	2,978		$	153,519								$	156,497
Home equity	239			105			451			795			48,578									49,373
Non-core portfolio
Residential mortgage ⁽⁵⁾	1,338			674			5,343			7,355			17,818			$	10,127					35,300
Home equity	260			136			832			1,228			12,231			3,611						17,070
Credit card and other consumer
U.S. credit card	472			341			782			1,595			90,683									92,278
Non-U.S. credit card	37			27			66			130			9,084									9,214
Direct/Indirect consumer ⁽⁶⁾	272			79			34			385			93,704									94,089
Other consumer ⁽⁷⁾	26			8			6			40			2,459									2,499
Total consumer	3,984			1,795			8,727			14,506			428,076			13,738						456,320
Consumer loans accounted for under the fair value option ⁽⁸⁾																			$	1,051		1,051
Total consumer loans and leases	3,984			1,795			8,727			14,506			428,076			13,738			1,051			457,371
Commercial
U.S. commercial	952			263			400			1,615			268,757									270,372
Commercial real estate ⁽⁹⁾	20			10			56			86			57,269									57,355
Commercial lease financing	167			21			27			215			22,160									22,375
Non-U.S. commercial	348			4			5			357			89,040									89,397
U.S. small business commercial	96			49			84			229			12,764									12,993
Total commercial	1,583			347			572			2,502			449,990									452,492
Commercial loans accounted for under the fair value option ⁽⁸⁾																			6,034			6,034
Total commercial loans and leases	1,583			347			572			2,502			449,990						6,034			458,526
Total consumer and commercial loans and leases⁽¹⁰⁾	$	5,567		$	2,142		$	9,299		$	17,008		$	878,066		$	13,738		$	7,085		$	915,897
Less: Loans of business held for sale⁽¹⁰⁾																						(9,214		)
Total loans and leases ⁽¹¹⁾																						$	906,683
Percentage of outstandings ⁽¹⁰⁾	0.61		%	0.23		%	1.02		%	1.86		%	95.87		%	1.50		%	0.77		%	100.00		%


⁽¹⁾	Consumer real estate loans 30-59 days past due includes fully-insured loans of $1.1 billion and nonperforming loans of $266 million. Consumer real estate loans 60-89 days past due includes fully-insured loans of $547 million and nonperforming loans of $216 million.


⁽²⁾	Consumer real estate includes fully-insured loans of $4.8 billion.


⁽³⁾	Consumer real estate includes $2.5 billion and direct/indirect consumer includes $27 million of nonperforming loans.


⁽⁴⁾	PCI loan amounts are shown gross of the valuation allowance.


⁽⁵⁾	Total outstandings includes pay option loans of $1.8 billion. The Corporation no longer originates this product.


⁽⁶⁾	Total outstandings includes auto and specialty lending loans of $48.9 billion, unsecured consumer lending loans of $585 million, U.S. securities-based lending loans of $40.1 billion, non-U.S. consumer loans of $3.0 billion, student loans of $497 million and other consumer loans of $1.1 billion.


⁽⁷⁾	Total outstandings includes consumer finance loans of $465 million, consumer leases of $1.9 billion and consumer overdrafts of $157 million.


⁽⁸⁾	Consumer loans accounted for under the fair value option were residential mortgage loans of $710 million and home equity loans of $341 million. Commercial loans accounted for under the fair value option were U.S. commercial loans of $2.9 billion and non-U.S. commercial loans of $3.1 billion. For more information, see Note 14 – Fair Value Measurements and Note 15 – Fair Value Option.


⁽⁹⁾	Total outstandings includes U.S. commercial real estate loans of $54.3 billion and non-U.S. commercial real estate loans of $3.1 billion.


⁽¹⁰⁾	Includes non-U.S. credit card loans, which are included in assets of business held for sale on the Consolidated Balance Sheet.


⁽¹¹⁾	The Corporation pledged $143.1 billion of loans to secure potential borrowing capacity with the Federal Reserve Bank and FHLB. This amount is not included in the parenthetical disclosure of loans and leases pledged as collateral on the Consolidated Balance Sheet as there were no related outstanding borrowings.

Schedule of Financing Receivables, Non Accrual Status

The table below presents the Corporation’s nonperforming loans and leases including nonperforming TDRs, and loans accruing past due 90 days or more at June 30, 2017 and December 31, 2016. 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 2016 Annual Report on Form 10-K.




Credit Quality

	Nonperforming Loans and Leases				Accruing Past Due 90 Days or More
(Dollars in millions)	June 30 2017		December 31 2016		June 30 2017		December 31 2016
Consumer real estate
Core portfolio
Residential mortgage ⁽¹⁾	$	1,051	$	1,274	$	398	$	486
Home equity	970		969		—		—
Non-core portfolio
Residential mortgage⁽¹⁾	1,528		1,782		3,301		4,307
Home equity	1,711		1,949		—		—
Credit card and other consumer
U.S. credit card	n/a		n/a		772		782
Non-U.S. credit card	n/a		n/a		—		66
Direct/Indirect consumer	19		28		32		34
Other consumer	3		2		3		4
Total consumer	5,282		6,004		4,506		5,679
Commercial
U.S. commercial	1,039		1,256		74		106
Commercial real estate	123		72		—		7
Commercial lease financing	28		36		22		19
Non-U.S. commercial	269		279		—		5
U.S. small business commercial	61		60		68		71
Total commercial	1,520		1,703		164		208
Total loans and leases	$	6,802	$	7,707	$	4,670	$	5,887

⁽¹⁾

Residential mortgage loans in the core and non-core portfolios accruing past due 90 days or more are fully-insured loans. At June 30, 2017 and December 31, 2016, residential mortgage includes $2.4 billion and $3.0 billion of loans on which interest has been curtailed by the Federal Housing Administration (FHA), and therefore are no longer accruing interest, although principal is still insured, and $1.3 billion and $1.8 billion of loans on which interest is still accruing.

n/a = not applicable

Financing Receivable Credit Quality Indicators

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, at June 30, 2017 and December 31, 2016.




Consumer Real Estate – Credit Quality Indicators ⁽¹⁾
	June 30, 2017
(Dollars in millions)	Core Residential Mortgage ⁽²⁾		Non-core Residential Mortgage ⁽²⁾		Residential Mortgage PCI ⁽³⁾		Core Home Equity ⁽²⁾		Non-core Home Equity ⁽²⁾		Home Equity PCI
Refreshed LTV⁽⁴⁾
Less than or equal to 90 percent	$	140,898	$	13,168	$	7,436	$	44,878	$	8,128	$	1,810
Greater than 90 percent but less than or equal to 100 percent	3,640		1,185		839		808		1,392		525
Greater than 100 percent	1,671		1,545		999		956		2,610		835
Fully-insured loans ⁽⁵⁾	20,000		6,065		—		—		—		—
Total consumer real estate	$	166,209	$	21,963	$	9,274	$	46,642	$	12,130	$	3,170
Refreshed FICO score
Less than 620	$	2,329	$	2,773	$	2,361	$	1,210	$	2,410	$	500
Greater than or equal to 620 and less than 680	4,894		2,438		1,998		2,582		2,739		547
Greater than or equal to 680 and less than 740	23,308		4,106		2,756		9,026		2,964		926
Greater than or equal to 740	115,678		6,581		2,159		33,824		4,017		1,197
Fully-insured loans ⁽⁵⁾	20,000		6,065		—		—		—		—
Total consumer real estate	$	166,209	$	21,963	$	9,274	$	46,642	$	12,130	$	3,170


⁽¹⁾	Excludes $1.0 billion of loans accounted for under the fair value option.


⁽²⁾	Excludes PCI loans.


⁽³⁾	Includes $1.4 billion of pay option loans. The Corporation no longer originates this product.


⁽⁴⁾	Refreshed LTV percentages for PCI loans are calculated using the carrying value net of the related valuation allowance.


⁽⁵⁾	Credit quality indicators are not reported for fully-insured loans as principal repayment is insured.




Credit Card and Other Consumer – Credit Quality Indicators
	June 30, 2017
(Dollars in millions)	U.S. Credit Card		Direct/Indirect Consumer		Other Consumer ⁽¹⁾
Refreshed FICO score
Less than 620	$	4,349	$	1,550	$	169
Greater than or equal to 620 and less than 680	11,993		2,038		217
Greater than or equal to 680 and less than 740	34,147		12,257		425
Greater than or equal to 740	40,287		33,764		1,688
Other internal credit metrics ^{(2, 3)}	—		43,884		159
Total credit card and other consumer	$	90,776	$	93,493	$	2,658


⁽¹⁾	At June 30, 2017, 16 percent of the other consumer portfolio was associated with portfolios from certain consumer finance businesses that the Corporation previously exited.


⁽²⁾	Other internal credit metrics may include delinquency status, geography or other factors.


⁽³⁾	Direct/indirect consumer includes $42.8 billion of securities-based lending which is overcollateralized and therefore has minimal credit risk and $464 million of loans the Corporation no longer originates, primarily student loans.




Commercial – Credit Quality Indicators ⁽¹⁾
	June 30, 2017
(Dollars in millions)	U.S. Commercial		Commercial Real Estate		Commercial Lease Financing		Non-U.S. Commercial		U.S. Small Business Commercial ⁽²⁾
Risk ratings
Pass rated	$	268,793	$	58,538	$	21,103	$	87,639	$	376
Reservable criticized	8,882		639		725		3,147		57
Refreshed FICO score ⁽³⁾
Less than 620									221
Greater than or equal to 620 and less than 680									623
Greater than or equal to 680 and less than 740									1,863
Greater than or equal to 740									3,593
Other internal credit metrics ^{(3, 4)}									6,827
Total commercial	$	277,675	$	59,177	$	21,828	$	90,786	$	13,560


⁽¹⁾	Excludes $6.3 billion of loans accounted for under the fair value option.


⁽²⁾	U.S. small business commercial includes $806 million of criticized business card and small business loans which are evaluated using refreshed FICO scores or internal credit metrics, including delinquency status, rather than risk ratings. At June 30, 2017, 99 percent of the balances where internal credit metrics are used was current or less than 30 days past due.


⁽³⁾	Refreshed FICO score and other internal credit metrics are applicable only to the U.S. small business commercial portfolio.


⁽⁴⁾	Other internal credit metrics may include delinquency status, application scores, geography or other factors.




Consumer Real Estate – Credit Quality Indicators ⁽¹⁾
	December 31, 2016
(Dollars in millions)	Core Residential Mortgage ⁽²⁾		Non-core Residential Mortgage ⁽²⁾		Residential Mortgage PCI ⁽³⁾		Core Home Equity ⁽²⁾		Non-core Home Equity ⁽²⁾		Home Equity PCI
Refreshed LTV ⁽⁴⁾
Less than or equal to 90 percent	$	129,737	$	14,280	$	7,811	$	47,171	$	8,480	$	1,942
Greater than 90 percent but less than or equal to 100 percent	3,634		1,446		1,021		1,006		1,668		630
Greater than 100 percent	1,872		1,972		1,295		1,196		3,311		1,039
Fully-insured loans ⁽⁵⁾	21,254		7,475		—		—		—		—
Total consumer real estate	$	156,497	$	25,173	$	10,127	$	49,373	$	13,459	$	3,611
Refreshed FICO score
Less than 620	$	2,479	$	3,198	$	2,741	$	1,254	$	2,692	$	559
Greater than or equal to 620 and less than 680	5,094		2,807		2,241		2,853		3,094		636
Greater than or equal to 680 and less than 740	22,629		4,512		2,916		10,069		3,176		1,069
Greater than or equal to 740	105,041		7,181		2,229		35,197		4,497		1,347
Fully-insured loans ⁽⁵⁾	21,254		7,475		—		—		—		—
Total consumer real estate	$	156,497	$	25,173	$	10,127	$	49,373	$	13,459	$	3,611


⁽¹⁾	Excludes $1.1 billion of loans accounted for under the fair value option.


⁽²⁾	Excludes PCI loans.


⁽³⁾	Includes $1.6 billion of pay option loans. The Corporation no longer originates this product.


⁽⁴⁾	Refreshed LTV percentages for PCI loans are calculated using the carrying value net of the related valuation allowance.


⁽⁵⁾	Credit quality indicators are not reported for fully-insured loans as principal repayment is insured.




Credit Card and Other Consumer – Credit Quality Indicators
	December 31, 2016
(Dollars in millions)	U.S. Credit Card		Non-U.S. Credit Card		Direct/Indirect Consumer		Other Consumer ⁽¹⁾
Refreshed FICO score
Less than 620	$	4,431	$	—	$	1,478	$	187
Greater than or equal to 620 and less than 680	12,364		—		2,070		222
Greater than or equal to 680 and less than 740	34,828		—		12,491		404
Greater than or equal to 740	40,655		—		33,420		1,525
Other internal credit metrics ^{(2, 3, 4)}	—		9,214		44,630		161
Total credit card and other consumer	$	92,278	$	9,214	$	94,089	$	2,499


⁽¹⁾	At December 31, 2016, 19 percent of the other consumer portfolio was associated with portfolios from certain consumer finance businesses that the Corporation previously exited.


⁽²⁾	Other internal credit metrics may include delinquency status, geography or other factors.


⁽³⁾	Direct/indirect consumer includes $43.1 billion of securities-based lending which is overcollateralized and therefore has minimal credit risk and $499 million of loans the Corporation no longer originates, primarily student loans.


⁽⁴⁾	Non-U.S. credit card represents the U.K. credit card portfolio which was evaluated using internal credit metrics, including delinquency status. At December 31, 2016, 98 percent of this portfolio was current or less than 30 days past due, one percent was 30-89 days past due and one percent was 90 days or more past due.




Commercial – Credit Quality Indicators ⁽¹⁾
	December 31, 2016
(Dollars in millions)	U.S. Commercial		Commercial Real Estate		Commercial Lease Financing		Non-U.S. Commercial		U.S. Small Business Commercial ⁽²⁾
Risk ratings
Pass rated	$	261,214	$	56,957	$	21,565	$	85,689	$	453
Reservable criticized	9,158		398		810		3,708		71
Refreshed FICO score ⁽³⁾
Less than 620									200
Greater than or equal to 620 and less than 680									591
Greater than or equal to 680 and less than 740									1,741
Greater than or equal to 740									3,264
Other internal credit metrics ^{(3, 4)}									6,673
Total commercial	$	270,372	$	57,355	$	22,375	$	89,397	$	12,993


⁽¹⁾	Excludes $6.0 billion of loans accounted for under the fair value option.


⁽²⁾	U.S. small business commercial includes $755 million of criticized business card and small business loans which are evaluated using refreshed FICO scores or internal credit metrics, including delinquency status, rather than risk ratings. At December 31, 2016, 98 percent of the balances where internal credit metrics are used was current or less than 30 days past due.


⁽³⁾	Refreshed FICO score and other internal credit metrics are applicable only to the U.S. small business commercial portfolio.


⁽⁴⁾	Other internal credit metrics may include delinquency status, application scores, geography or other factors.

Financing Receivable, Modifications [Line Items]

Accretable Yield Activity

The table below shows activity for the accretable yield on PCI loans, which include the Countrywide Financial Corporation (Countrywide) portfolio and loans repurchased in connection with the 2013 settlement with FNMA. The amount of accretable yield is affected by changes in credit outlooks, including metrics such as default rates and loss severities, prepayment speeds, which can change the amount and period of time over which interest payments are expected to be received, and the interest rates on variable rate loans. The reclassifications from nonaccretable difference in the three and six months ended June 30, 2017 were primarily due to an increase in the expected principal and interest cash flows due to lower default estimates.




Rollforward of Accretable Yield

(Dollars in millions)	Three Months Ended June 30, 2017			Six Months Ended June 30, 2017
Accretable yield, beginning of period	$	3,550		$	3,805
Accretion	(155		)	(318		)
Disposals/transfers	(148		)	(239		)
Reclassifications from nonaccretable difference	41			40
Accretable yield, June 30, 2017	$	3,288		$	3,288

Consumer real estate

Financing Receivable, Impaired [Line Items]

Impaired Financing Receivables

The table below provides the unpaid principal balance, carrying value and related allowance at June 30, 2017 and December 31, 2016, and the average carrying value and interest income recognized for the three and six months ended June 30, 2017 and 2016 for impaired loans in the Corporation’s Consumer Real Estate portfolio segment. Certain impaired consumer real estate loans do not have a related allowance as the current valuation of these impaired loans exceeded the carrying value, which is net of previously recorded charge-offs.




Impaired Loans – Consumer Real Estate

					June 30, 2017						December 31, 2016
(Dollars in millions)					Unpaid Principal Balance		Carrying Value		Related Allowance		Unpaid Principal Balance		Carrying Value		Related Allowance
With no recorded allowance
Residential mortgage					$	9,966	$	7,696	$	—	$	11,151	$	8,695	$	—
Home equity					3,692		1,987		—		3,704		1,953		—
With an allowance recorded
Residential mortgage					$	3,525	$	3,424	$	211	$	4,041	$	3,936	$	219
Home equity					978		886		170		910		824		137
Total
Residential mortgage					$	13,491	$	11,120	$	211	$	15,192	$	12,631	$	219
Home equity					4,670		2,873		170		4,614		2,777		137

	Three Months Ended June 30								Six Months Ended June 30
	2017				2016				2017				2016
	Average Carrying Value		Interest Income Recognized ⁽¹⁾		Average Carrying Value		Interest Income Recognized ⁽¹⁾		Average Carrying Value		Interest Income Recognized ⁽¹⁾		Average Carrying Value		Interest Income Recognized ⁽¹⁾
With no recorded allowance
Residential mortgage	$	7,886	$	81	$	10,345	$	100	$	8,192	$	160	$	10,925	$	194
Home equity	1,999		28		1,870		17		2,000		55		1,843		30
With an allowance recorded
Residential mortgage	$	3,647	$	33	$	5,387	$	46	$	3,723	$	68	$	5,737	$	97
Home equity	868		7		873		5		842		12		882		11
Total
Residential mortgage	$	11,533	$	114	$	15,732	$	146	$	11,915	$	228	$	16,662	$	291
Home equity	2,867		35		2,743		22		2,842		67		2,725		41


⁽¹⁾	Interest income recognized includes interest accrued and collected on the outstanding balances of accruing impaired loans as well as interest cash collections on nonaccruing impaired loans for which the principal is considered collectible.

Financing Receivable, Modifications [Line Items]

Troubled Debt Restructurings on Financing Receivables

The table below presents the June 30, 2017 and 2016 carrying value for consumer real estate loans that were modified in a TDR during the three and six months ended June 30, 2017 and 2016 by type of modification.




Consumer Real Estate – Modification Programs

	TDRs Entered into During the Three Months Ended June 30
	2017				2016
(Dollars in millions)	Residential Mortgage		Home Equity		Residential Mortgage		Home Equity
Modifications under government programs
Contractual interest rate reduction	$	9	$	2	$	23	$	12
Principal and/or interest forbearance	—		1		—		4
Other modifications ⁽¹⁾	3		—		8		—
Total modifications under government programs	12		3		31		16
Modifications under proprietary programs
Contractual interest rate reduction	19		1		14		2
Capitalization of past due amounts	9		—		5		—
Principal and/or interest forbearance	3		—		2		1
Other modifications⁽¹⁾	3		13		9		17
Total modifications under proprietary programs	34		14		30		20
Trial modifications	222		165		300		145
Loans discharged in Chapter 7 bankruptcy ⁽²⁾	45		19		44		19
Total modifications	$	313	$	201	$	405	$	200

	TDRs Entered into During the Six Months Ended June 30
	2017				2016
Modifications under government programs
Contractual interest rate reduction	$	33	$	5	$	66	$	18
Principal and/or interest forbearance	1		2		—		6
Other modifications ⁽¹⁾	8		—		19		1
Total modifications under government programs	42		7		85		25
Modifications under proprietary programs
Contractual interest rate reduction	39		33		32		28
Capitalization of past due amounts	16		5		14		3
Principal and/or interest forbearance	5		4		6		16
Other modifications⁽¹⁾	4		40		11		20
Total modifications under proprietary programs	64		82		63		67
Trial modifications	382		240		540		230
Loans discharged in Chapter 7 bankruptcy ⁽²⁾	93		36		97		39
Total modifications	$	581	$	365	$	785	$	361


⁽¹⁾	Includes other modifications such as term or payment extensions and repayment plans.


⁽²⁾	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 and six months ended June 30, 2017 and 2016 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 June 30
	2017				2016
(Dollars in millions)	Residential Mortgage		Home Equity		Residential Mortgage		Home Equity
Modifications under government programs	$	19	$	1	$	85	$	1
Modifications under proprietary programs	14		19		35		5
Loans discharged in Chapter 7 bankruptcy ⁽¹⁾	12		3		31		6
Trial modifications ⁽²⁾	40		6		184		29
Total modifications	$	85	$	29	$	335	$	41

	Six Months Ended June 30
	2017				2016
Modifications under government programs	$	44	$	2	$	178	$	1
Modifications under proprietary programs	30		37		78		27
Loans discharged in Chapter 7 bankruptcy ⁽¹⁾	70		7		71		11
Trial modifications⁽²⁾	235		23		421		66
Total modifications	$	379	$	69	$	748	$	105


⁽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.

The table below presents the June 30, 2017 and 2016 unpaid principal balance, carrying value, and average pre- and post-modification interest rates on consumer real estate loans that were modified in TDRs during the three and six months ended June 30, 2017 and 2016, and net charge-offs recorded during the period in which the modification occurred. 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 Months Ended June 30, 2017 and 2016 ⁽¹⁾

	June 30, 2017								Three Months Ended June 30, 2017
(Dollars in millions)	Unpaid Principal Balance		Carrying Value		Pre-Modification Interest Rate		Post-Modification Interest Rate ⁽²⁾		Net Charge-offs ⁽³⁾
Residential mortgage	$	346	$	313	4.50	%	4.37	%	$	1
Home equity	250		201		4.11		3.94		11
Total	$	596	$	514	4.33		4.19		$	12

	June 30, 2016								Three Months Ended June 30, 2016
Residential mortgage	$	437	$	405	4.68	%	4.42	%	$	3
Home equity	250		200		3.81		3.27		16
Total	$	687	$	605	4.36		4.00		$	19

Consumer Real Estate – TDRs Entered into During the Six Months Ended June 30, 2017 and 2016 ⁽¹⁾

	June 30, 2017								Six Months Ended June 30, 2017
Residential mortgage	$	646	$	581	4.51	%	4.34	%	$	3
Home equity	469		365		4.20		3.75		17
Total	$	1,115	$	946	4.38		4.09		$	20

	June 30, 2016								Six Months Ended June 30, 2016
Residential mortgage	$	854	$	785	4.72	%	4.45	%	$	5
Home equity	460		361		3.63		3.10		26
Total	$	1,314	$	1,146	4.34		3.98		$	31


⁽¹⁾	During the three and six months ended June 30, 2017, the Corporation forgave principal of $0 million and $0 million related to residential mortgage loans in connection with TDRs compared to $1 million and $11 million for the same periods in 2016.


⁽²⁾	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.


⁽³⁾	Net charge-offs include amounts recorded on loans modified during the period that are no longer held by the Corporation at June 30, 2017 and 2016 due to sales and other dispositions.

Credit card and other consumer

Financing Receivable, Impaired [Line Items]

Impaired Financing Receivables

The following tables for the three and six months ended June 30, 2017 reflect the sale of the non-U.S. credit card portfolio.




Impaired Loans – Credit Card and Other Consumer

					June 30, 2017						December 31, 2016
(Dollars in millions)					Unpaid Principal Balance		Carrying Value ⁽¹⁾		Related Allowance		Unpaid Principal Balance		Carrying Value ⁽¹⁾		Related Allowance
With no recorded allowance
Direct/Indirect consumer					$	43	$	18	$	—	$	49	$	22	$	—
With an allowance recorded
U.S. credit card					$	452	$	458	$	131	$	479	$	485	$	128
Non-U.S. credit card					n/a		n/a		n/a		88		100		61
Direct/Indirect consumer					1		2		—		3		3		—
Total
U.S. credit card					$	452	$	458	$	131	$	479	$	485	$	128
Non-U.S. credit card					n/a		n/a		n/a		88		100		61
Direct/Indirect consumer					44		20		—		52		25		—

	Three Months Ended June 30								Six Months Ended June 30
	2017				2016				2017				2016
	Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾
With no recorded allowance
Direct/Indirect consumer	$	18	$	—	$	21	$	—	$	18	$	—	$	21	$	—
With an allowance recorded
U.S. credit card	$	463	$	6	$	568	$	8	$	470	$	12	$	587	$	17
Non-U.S. credit card	78		—		116		1		88		1		119		2
Direct/Indirect consumer	2		—		11		—		3		—		15		—
Total
U.S. credit card	$	463	$	6	$	568	$	8	$	470	$	12	$	587	$	17
Non-U.S. credit card	78		—		116		1		88		1		119		2
Direct/Indirect consumer	20		—		32		—		21		—		36		—


⁽¹⁾	Includes accrued interest and fees.


⁽²⁾	Interest income recognized includes interest accrued and collected on the outstanding balances of accruing impaired loans as well as interest cash collections on nonaccruing impaired loans for which the principal is considered collectible.

n/a = not applicable.

Financing Receivable, Modifications [Line Items]

Troubled Debt Restructurings on Financing Receivables

The table below provides information on the Corporation’s Credit Card and Other Consumer TDR portfolio including the June 30, 2017 and 2016 unpaid principal balance, carrying value, and average pre- and post-modification interest rates of loans that were modified in TDRs during three and six months ended June 30, 2017 and 2016, and net charge-offs recorded during the period in which the modification occurred.




Credit Card and Other Consumer – TDRs Entered into During the Three Months Ended June 30, 2017 and 2016

	June 30, 2017								Three Months Ended June 30, 2017
(Dollars in millions)	Unpaid Principal Balance		Carrying Value ⁽¹⁾		Pre-Modification Interest Rate		Post-Modification Interest Rate		Net Charge-offs
U.S. credit card	$	52	$	57	18.31	%	5.30	%	$	4
Non-U.S. credit card	—		—		n/a		n/a		6
Direct/Indirect consumer	7		4		4.14		4.08		3
Total	$	59	$	61	17.31		5.21		$	13

	June 30, 2016								Three Months Ended June 30, 2016
U.S. credit card	$	44	$	47	17.57	%	5.41	%	$	3
Non-U.S. credit card	30		36		24.01		0.35		7
Direct/Indirect consumer	7		4		4.52		4.34		3
Total	$	81	$	87	19.54		3.30		$	13

Credit Card and Other Consumer – TDRs Entered into During the Six Months Ended June 30, 2017 and 2016

	June 30, 2017								Six Months Ended June 30, 2017
U.S. credit card	$	100	$	106	18.19	%	5.32	%	$	5
Non-U.S. credit card	—		—		n/a		n/a		7
Direct/Indirect consumer	11		6		4.12		4.04		7
Total	$	111	$	112	17.39		5.24		$	19

	June 30, 2016								Six Months Ended June 30, 2016
U.S. credit card	$	87	$	93	17.47	%	5.47	%	$	4
Non-U.S. credit card	53		62		23.80		0.37		8
Direct/Indirect consumer	12		7		4.50		4.29		5
Total	$	152	$	162	19.30		3.47		$	17


⁽¹⁾	Includes accrued interest and fees.

n/a = not applicable

The table below provides information on the Corporation’s primary modification programs for the Credit Card and Other Consumer TDR portfolio at June 30, 2017 and December 31, 2016.




Credit Card and Other Consumer – TDRs by Program Type

	Internal Programs				External Programs				Other ⁽¹⁾				Total				Percent of Balances Current or Less Than 30 Days Past Due
(Dollars in millions)	June 30 2017		December 31 2016		June 30 2017		December 31 2016		June 30 2017		December 31 2016		June 30 2017		December 31 2016		June 30 2017		December 31 2016
U.S. credit card	$	202	$	220	$	255	$	264	$	1	$	1	$	458	$	485	89.26	%	88.99	%
Non-U.S. credit card	n/a		11		n/a		7		n/a		82		n/a		100		n/a		38.47
Direct/Indirect consumer	1		2		1		1		18		22		20		25		92.99		90.49
Total TDRs by program type	$	203	$	233	$	256	$	272	$	19	$	105	$	478	$	610	89.42		80.79


⁽¹⁾	Other TDRs for non-U.S. credit card included modifications of accounts that are ineligible for a fixed payment plan.

n/a = not applicable.

Commercial Portfolio Segment

Financing Receivable, Impaired [Line Items]

Impaired Financing Receivables

The table below provides the unpaid principal balance, carrying value and related allowance at June 30, 2017 and December 31, 2016, and the average carrying value and interest income recognized for the three and six months ended June 30, 2017 and 2016 for impaired loans in the Corporation’s Commercial loan portfolio segment. Certain impaired commercial loans do not have a related allowance as the valuation of these impaired loans exceeded the carrying value, which is net of previously recorded charge-offs.




Impaired Loans – Commercial

					June 30, 2017						December 31, 2016
(Dollars in millions)					Unpaid Principal Balance		Carrying Value		Related Allowance		Unpaid Principal Balance		Carrying Value		Related Allowance
With no recorded allowance
U.S. commercial					$	785	$	777	$	—	$	860	$	827	$	—
Commercial real estate					53		47		—		77		71		—
Non-U.S. commercial					—		—		—		130		130		—
With an allowance recorded
U.S. commercial					$	1,550	$	1,215	$	103	$	2,018	$	1,569	$	132
Commercial real estate					239		115		13		243		96		10
Commercial lease financing					9		7		1		6		4		—
Non-U.S. commercial					557		476		96		545		432		104
U.S. small business commercial ⁽¹⁾					88		75		29		85		73		27
Total
U.S. commercial					$	2,335	$	1,992	$	103	$	2,878	$	2,396	$	132
Commercial real estate					292		162		13		320		167		10
Commercial lease financing					9		7		1		6		4		—
Non-U.S. commercial					557		476		96		675		562		104
U.S. small business commercial ⁽¹⁾					88		75		29		85		73		27

	Three Months Ended June 30								Six Months Ended June 30
	2017				2016				2017				2016
	Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾		Average Carrying Value		Interest Income Recognized ⁽²⁾
With no recorded allowance
U.S. commercial	$	857	$	3	$	656	$	3	$	870	$	6	$	619	$	5
Commercial real estate	48		—		65		—		54		—		71		—
Non-U.S. commercial	43		—		17		—		75		—		11		—
With an allowance recorded
U.S. commercial	$	1,264	$	7	$	1,646	$	16	$	1,376	$	16	$	1,544	$	30
Commercial real estate	106		1		96		1		91		2		100		2
Commercial lease financing	4		—		1		—		4		—		1		—
Non-U.S. commercial	482		3		349		3		469		6		359		6
U.S. small business commercial⁽¹⁾	77		—		92		—		75		—		97		—
Total
U.S. commercial	$	2,121	$	10	$	2,302	$	19	$	2,246	$	22	$	2,163	$	35
Commercial real estate	154		1		161		1		145		2		171		2
Commercial lease financing	4		—		1		—		4		—		1		—
Non-U.S. commercial	525		3		366		3		544		6		370		6
U.S. small business commercial ⁽¹⁾	77		—		92		—		75		—		97		—


⁽¹⁾	Includes U.S. small business commercial renegotiated TDR loans and related allowance.


⁽²⁾	Interest income recognized includes interest accrued and collected on the outstanding balances of accruing impaired loans as well as interest cash collections on nonaccruing impaired loans for which the principal is considered collectible.

Financing Receivable, Modifications [Line Items]

Troubled Debt Restructurings on Financing Receivables

The table below presents the June 30, 2017 and 2016 unpaid principal balance and carrying value of commercial loans that were modified as TDRs during the three and six months ended June 30, 2017 and 2016, and net charge-offs that were recorded during the period in which the modification occurred. The table below includes 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.




Commercial – TDRs Entered into During the Three Months Ended June 30, 2017 and 2016

	June 30, 2017				Three Months Ended June 30, 2017
(Dollars in millions)	Unpaid Principal Balance		Carrying Value		Net Charge-offs
U.S. commercial	$	405	$	393	$	14
Commercial real estate	44		37		7
U.S. small business commercial ⁽¹⁾	7		7		—
Total	$	456	$	437	$	21

	June 30, 2016				Three Months Ended June 30, 2016
U.S. commercial	$	873	$	849	$	24
Commercial real estate	12		12		—
Commercial lease financing	5		2		2
Non-U.S. commercial	115		99		12
U.S. small business commercial ⁽¹⁾	2		2		—
Total	$	1,007	$	964	$	38

Commercial – TDRs Entered into During the Six Months Ended June 30, 2017 and 2016

	June 30, 2017				Six Months Ended June 30, 2017
	Unpaid Principal Balance		Carrying Value		Net Charge-offs
U.S. commercial	$	687	$	648	$	55
Commercial real estate	59		46		7
U.S. small business commercial ⁽¹⁾	9		10		—
Total	$	755	$	704	$	62

	June 30, 2016				Six Months Ended June 30, 2016
U.S. commercial	$	1,341	$	1,299	$	29
Commercial real estate	22		22		1
Commercial lease financing	5		2		2
Non-U.S. commercial	287		207		48
U.S. small business commercial ⁽¹⁾	3		3		—
Total	$	1,658	$	1,533	$	80


⁽¹⁾	U.S. small business commercial TDRs are comprised of renegotiated small business card loans.