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Loans, Leases, and Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2021
Receivables [Abstract]  
LOANS, LEASES, AND ALLOWANCE FOR CREDIT LOSSES LOANS, LEASES, AND ALLOWANCE FOR CREDIT LOSSES
Loans, Leases, and Loans Held for Sale
Loans and leases are summarized as follows according to major portfolio segment and specific loan class:
(In millions)June 30,
2021		December 31,
2020
Loans held for sale$66 $81 
Commercial:
Commercial and industrial$12,947 $13,444 
PPP4,461 5,572 
Leasing307 320 
Owner-occupied8,231 8,185 
Municipal3,215 2,951 
Total commercial29,161 30,472 
Commercial real estate:
Construction and land development2,576 2,345 
Term9,532 9,759 
Total commercial real estate12,108 12,104 
Consumer:
Home equity credit line2,727 2,745 
1-4 family residential6,269 6,969 
Construction and other consumer real estate593 630 
Bankcard and other revolving plans415 432 
Other125 124 
Total consumer10,129 10,900 
Total loans and leases
$51,398 $53,476 
Loans and leases are presented at their amortized cost basis, which includes net unamortized purchase premiums, discounts, and deferred loan fees and costs totaling $176 million and $149 million at June 30, 2021 and December 31, 2020, respectively. Amortized cost basis does not include accrued interest receivables of $180 million and $200 million at June 30, 2021 and December 31, 2020, respectively. These receivables are presented in the Consolidated Balance Sheet within the “Other Assets” line item.
Municipal loans generally include loans to state and local governments (“municipalities”) with the debt service being repaid from general funds or pledged revenues of the municipal entity, or to private commercial entities or 501(c)(3) not-for-profit entities utilizing a pass-through municipal entity to achieve favorable tax treatment.
Land acquisition and development loans included in the construction and land development loan portfolio were $171 million at June 30, 2021 and $156 million at December 31, 2020.
Loans with a carrying value of $23.1 billion at June 30, 2021 and $24.7 billion at December 31, 2020 have been pledged at the Federal Reserve and the FHLB of Des Moines as collateral for potential borrowings.
We sold loans totaling $436 million and $859 million for the three and six months ended June 30, 2021 and $608 million and $907 million for the three and six months ended June 30, 2020, respectively, that were classified as loans held for sale. The sold loans were derecognized from the balance sheet. Loans classified as loans held for sale primarily consist of conforming residential mortgages and the guaranteed portion of SBA loans that are primarily sold to U.S. government agencies or participated to third parties. They do not consist of loans from the SBA's Paycheck Protection Program. At times, we have continuing involvement in the sold loans in the form of servicing rights or a guarantee from the respective issuer. Amounts added to loans held for sale during these same periods were $428 million and $855 million for the three and six months ended June 30, 2021 and $602 million and $917 million for the three and six months ended June 30, 2020, respectively. See Note 5 for further information regarding guaranteed securities.
The principal balance of sold loans for which we retain servicing was approximately $3.0 billion at June 30, 2021, and $2.7 billion at December 31, 2020. Income from loans sold, excluding servicing, was $7 million and $18 million for the three and six months ended June 30, 2021, and $13 million and $26 million for the three and six months ended June 30, 2020, respectively.
Allowance for Credit Losses
The allowance for credit losses (“ACL”), which consists of the allowance for loan and lease losses (“ALLL”) and the reserve for unfunded lending commitments (“RULC”), represents our estimate of current expected credit losses related to the loan and lease portfolio and unfunded lending commitments as of the balance sheet date. For additional information regarding our policies and methodologies used to estimate the ACL, see Note 6 of our 2020 Form 10-K.
The ACL for AFS and HTM debt securities is estimated separately from loans. For HTM securities, the ACL is estimated consistent with the approach for loans carried at amortized cost. See Note 5 for further discussion on our estimate of expected credit losses on AFS securities and disclosures related to AFS and HTM securities.
Changes in the ACL are summarized as follows:
Three Months Ended June 30, 2021
(In millions)CommercialCommercial
real estate		ConsumerTotal
Allowance for loan losses
Balance at beginning of period$362 $152 $132 $646 
Provision for loan losses(43)(41)(29)(113)
Gross loan and lease charge-offs5 — 3 8 
Recoveries7 — 3 10 
Net loan and lease charge-offs (recoveries)(2)— — (2)
Balance at end of period$321 $111 $103 $535 
Reserve for unfunded lending commitments
Balance at beginning of period$24 $17 $8 $49 
Provision for unfunded lending commitments(3)(7)— (10)
Balance at end of period$21 $10 $8 $39 
Total allowance for credit losses at end of period
Allowance for loan losses$321 $111 $103 $535 
Reserve for unfunded lending commitments21 10 8 39 
Total allowance for credit losses$342 $121 $111 $574 
Six Months Ended June 30, 2021
(In millions)CommercialCommercial
real estate		ConsumerTotal
Allowance for loan losses
Balance at beginning of period$464 $171 $142 $777 
Provision for loan losses(137)(60)(39)(236)
Gross loan and lease charge-offs23 — 6 29 
Recoveries17 — 6 23 
Net loan and lease charge-offs (recoveries)6 — — 6 
Balance at end of period$321 $111 $103 $535 
Reserve for unfunded lending commitments
Balance at beginning of period$30 $20 $8 $58 
Provision for unfunded lending commitments(9)(10)— (19)
Balance at end of period$21 $10 $8 $39 
Total allowance for credit losses at end of period
Allowance for loan losses$321 $111 $103 $535 
Reserve for unfunded lending commitments21 10 8 39 
Total allowance for credit losses$342 $121 $111 $574 

Three Months Ended June 30, 2020
(In millions)CommercialCommercial real estateConsumerTotal
Allowance for loan losses
Balance at beginning of period$413 $128 $189 $730 
Provision for loan losses186 16 (41)161 
Gross loan and lease charge-offs31 — 5 36 
Recoveries3 — 2 5 
Net loan and lease charge-offs (recoveries)28 — 3 31 
Balance at end of period$571 $144 $145 $860 
Reserve for unfunded lending commitments
Balance at beginning of period$16 $23 $8 $47 
Provision for unfunded lending commitments11 (3)(1)7 
Balance at end of period$27 $20 $7 $54 
Total allowance for credit losses at end of period
Allowance for loan losses$571 $144 $145 $860 
Reserve for unfunded lending commitments27 20 7 54 
Total allowance for credit losses$598 $164 $152 $914 
Six Months Ended June 30, 2020
(In millions)CommercialCommercial
real estate		ConsumerTotal
Allowance for loan losses
Balance at beginning of period$282 $69 $146 $497 
Provision for loan losses323 75 3 401 
Gross loan and lease charge-offs41 — 8 49 
Recoveries7 — 4 11 
Net loan and lease charge-offs (recoveries)34 — 4 38 
Balance at end of period$571 $144 $145 $860 
Reserve for unfunded lending commitments
Balance at beginning of period$11 $12 $6 $29 
Provision for unfunded lending commitments16 8 1 25 
Balance at end of period$27 $20 $7 $54 
Total allowance for credit losses at end of period
Allowance for loan losses$571 $144 $145 $860 
Reserve for unfunded lending commitments27 20 7 54 
Total allowance for credit losses$598 $164 $152 $914 
Nonaccrual Loans
Loans are generally placed on nonaccrual status when payment in full of principal and interest is not expected, or the loan is 90 days or more past due as to principal or interest, unless the loan is both well-secured and in the process of collection. Factors we consider in determining whether a loan is placed on nonaccrual include delinquency status, collateral-value, borrower or guarantor financial statement information, bankruptcy status, and other information which would indicate that the full and timely collection of interest and principal is uncertain.
A nonaccrual loan may be returned to accrual status when (1) all delinquent interest and principal become current in accordance with the terms of the loan agreement, (2) the loan, if secured, is well-secured, (3) the borrower has paid according to the contractual terms for a minimum of six months, and (4) an analysis of the borrower indicates a reasonable assurance of his or her ability and willingness to maintain payments.
The amortized cost basis of loans on nonaccrual status is summarized as follows:
June 30, 2021
Amortized cost basisTotal amortized cost basis
(In millions)with no allowancewith allowanceRelated allowance
Loans held for sale$1 $— $1 $— 
Commercial:
Commercial and industrial$32 $79 $111 $20 
PPP— 1 1 — 
Owner-occupied36 33 69 3 
Total commercial68 113 181 23 
Commercial real estate:
Term13 15 28 2 
Total commercial real estate13 15 28 2 
Consumer:
Home equity credit line6 12 18 3 
1-4 family residential13 65 78 5 
Bankcard and other revolving plans— 1 1 — 
Total consumer loans19 78 97 8 
Total$100 $206 $306 $33 
December 31, 2020
Amortized cost basisTotal amortized cost basis
(In millions)with no allowancewith allowanceRelated allowance
Commercial:
Commercial and industrial$73 $67 $140 $22 
Owner-occupied38 38 76 4 
Total commercial111 105 216 26 
Commercial real estate:
Term12 19 31 3 
Total commercial real estate12 19 31 3 
Consumer:
Home equity credit line2 14 16 3 
1-4 family residential14 89 103 9 
Bankcard and other revolving plans— 1 1 1 
Total consumer loans16 104 120 13 
Total$139 $228 $367 $42 
For accruing loans, interest is accrued, and interest payments are recognized into interest income according to the contractual loan agreement. For nonaccruing loans, the accrual of interest is discontinued, any uncollected or accrued interest is reversed or written-off from interest income in a timely manner (generally within one month), and any payments received on these loans are not recognized into interest income, but are applied as a reduction to the principal outstanding. For the three and six months ended June 30, 2021 and 2020, there was no interest income recognized on a cash basis during the period the loans were on nonaccrual.
The amount of accrued interest receivables written-off by reversing interest income during the period is summarized by loan portfolio segment as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
(In millions)2021202020212020
Commercial$4 $4 $7 $8 
Commercial real estate1 1 1 1 
Consumer— — — — 
Total$5 $5 $8 $9 
Past Due Loans
Closed-end loans with payments scheduled monthly are reported as past due when the borrower is in arrears for two or more monthly payments. Similarly, open-end credits, such as bankcard and other revolving credit plans, are reported as past due when the minimum payment has not been made for two or more billing cycles. Other multi-payment obligations (i.e., quarterly, semi-annual, etc.), single payment, and demand notes, are reported as past due when either principal or interest is due and unpaid for a period of 30 days or more.
Past due loans (accruing and nonaccruing) are summarized as follows:
June 30, 2021
(In millions)Current30-89 days
past due		90+ days
past due		Total
past due		Total
loans		Accruing
loans
90+ days
past due
Nonaccrual
loans
that are
current 1
Commercial:
Commercial and industrial$12,907 $15 $25 $40 $12,947 $1 $86 
PPP4,461 — — — 4,461 — — 
Leasing307 — — — 307 — — 
Owner-occupied8,197 11 23 34 8,231 3 45 
Municipal3,215 — — — 3,215 — — 
Total commercial29,087 26 48 74 29,161 4 131 
Commercial real estate:
Construction and land development
2,576 — — — 2,576 — — 
Term9,521 2 9 11 9,532 2 21 
Total commercial real estate12,097 2 9 11 12,108 2 21 
Consumer:
Home equity credit line2,718 4 5 9 2,727 — 10 
1-4 family residential6,223 7 39 46 6,269 — 36 
Construction and other consumer real estate
593 — — — 593 — — 
Bankcard and other revolving plans
412 2 1 3 415 — — 
Other125 — — — 125 — — 
Total consumer loans10,071 13 45 58 10,129 — 46 
Total$51,255 $41 $102 $143 $51,398 $6 $198 
December 31, 2020
(In millions)Current30-89 days
past due		90+ days
past due		Total
past due		Total
loans		Accruing
loans
90+ days
past due
Nonaccrual
loans
that are
current 1
Commercial:
Commercial and industrial$13,388 $26 $30 $56 $13,444 $2 $109 
PPP5,572 — — — 5,572 — — 
Leasing320 — — — 320 — 1 
Owner-occupied8,129 34 22 56 8,185 — 48 
Municipal2,951 — — — 2,951 — — 
Total commercial30,360 60 52 112 30,472 2 158 
Commercial real estate:
Construction and land development
2,341 — 4 4 2,345 4 — 
Term9,692 57 10 67 9,759 4 13 
Total commercial real estate12,033 57 14 71 12,104 8 13 
Consumer:
Home equity credit line2,733 8 4 12 2,745 — 9 
1-4 family residential6,891 12 66 78 6,969 — 33 
Construction and other consumer real estate
630 — — — 630 — 
Bankcard and other revolving plans
428 2 2 4 432 2 1 
Other123 1 — 1 124 — — 
Total consumer loans10,805 23 72 95 10,900 2 43 
Total$53,198 $140 $138 $278 $53,476 $12 $214 
1 Represents nonaccrual loans that are not past due more than 30 days; however, full payment of principal and interest is still not expected.
Credit Quality Indicators
In addition to the nonaccrual and past due criteria, we also analyze loans using loan risk-grading systems, which vary based on the size and type of credit risk exposure. The internal risk grades we assign to loans are classified using the following definitions of Pass, Special Mention, Substandard, and Doubtful, which are consistent with published definitions of regulatory risk classifications.
•Pass – A Pass asset is higher-quality and does not fit any of the other categories described below. The likelihood of loss is considered low.
•Special Mention – A Special Mention asset has potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in our credit position at some future date.
•Substandard – A Substandard asset is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Assets so classified have well-defined weaknesses and are characterized by the distinct possibility that we may sustain some loss if deficiencies are not corrected.
•Doubtful – A Doubtful asset has all the weaknesses inherent in a Substandard asset with the added characteristics that the weaknesses make collection or liquidation in full highly questionable and improbable.
The balance of loans classified as Doubtful was less than $1 million at June 30, 2021 and was $4 million at December 31, 2020.
We generally assign internal risk grades to commercial and CRE loans with commitments greater than $1 million based on financial and statistical models, individual credit analysis, and loan officer experience and judgment. For these larger loans, we assign one of multiple risk grades within the Pass classification or one of the risk classifications described previously. We confirm our internal risk grades quarterly, or as soon as we identify information that affects the credit risk of the loan.
For consumer loans and certain small commercial and CRE loans with commitments less than or equal to $1 million, we generally assign internal risk grades similar to those described previously based on automated rules that depend on refreshed credit scores, payment performance, and other risk indicators. These are generally assigned either a Pass or Substandard grade and are reviewed as we identify information that might warrant a grade change.
The following schedule presents the amortized cost basis of loans and leases categorized by year of origination and risk classification as monitored by management. The year of origination is generally represented by the year the loan was either originated or the year in which the loan was renewed or restructured.
June 30, 2021
Term loansRevolving loans amortized cost basisRevolving loans converted to term loans amortized cost basis
Amortized cost basis by year of origination
(In millions)20212020201920182017PriorTotal
loans
Commercial:
Commercial and industrial
Pass$1,052 $1,476 $1,478 $912 $418 $315 $5,966 $169 $11,786 
Special Mention2 56 64 74 32 29 186 1 444 
Accruing Substandard20 38 139 92 34 64 217 2 606 
Nonaccrual1 10 2 4 8 27 39 20 111 
Total commercial and industrial1,075 1,580 1,683 1,082 492 435 6,408 192 12,947 
PPP
Pass2,556 1,904 — — — — — — 4,460 
Nonaccrual— 1 — — — — — — 1 
Total PPP2,556 1,905 — — — — — — 4,461 
Leasing
Pass11 53 79 74 48 26 — — 291 
Special Mention— 1 6 2 1 6 — — 16 
Accruing Substandard— — — — — — — — — 
Nonaccrual— — — — — — — — — 
Total leasing11 54 85 76 49 32 — — 307 
Owner-occupied
Pass804 1,568 1,060 1,059 824 2,001 132 76 7,524 
Special Mention8 56 57 55 23 68 8 7 282 
Accruing Substandard55 12 59 54 37 125 13 1 356 
Nonaccrual— 5 14 15 9 23 3 — 69 
Total owner-occupied867 1,641 1,190 1,183 893 2,217 156 84 8,231 
Municipal
Pass548 992 647 313 395 272 — — 3,167 
Special Mention— — — — — 34 — — 34 
Accruing Substandard— 9 — — — 5 — — 14 
Nonaccrual— — — — — — — — — 
Total municipal548 1,001 647 313 395 311 — — 3,215 
Total commercial5,057 6,181 3,605 2,654 1,829 2,995 6,564 276 29,161 
Commercial real estate:
Construction and land development
Pass298 745 708 160 43 3 524 56 2,537 
Special Mention— — 1 — — — — — 1 
Accruing Substandard12 — 26 — — — — — 38 
Nonaccrual— — — — — — — — — 
Total construction and land development310 745 735 160 43 3 524 56 2,576 
Term
Pass1,115 2,047 1,796 1,318 620 1,701 207 202 9,006 
Special Mention7 87 26 82 11 36 — 3 252 
Accruing Substandard8 10 30 99 20 76 1 2 246 
Nonaccrual— — 5 — 1 22 — — 28 
Total term1,130 2,144 1,857 1,499 652 1,835 208 207 9,532 
Total commercial real estate1,440 2,889 2,592 1,659 695 1,838 732 263 12,108 
June 30, 2021
Term loansRevolving loans amortized cost basisRevolving loans converted to term loans amortized cost basis
Amortized cost basis by year of origination
(In millions)20212020201920182017PriorTotal
loans
Consumer:
Home equity credit line
Pass— — — — — — 2,601 105 2,706 
Special Mention— — — — — — 1 — 1 
Accruing Substandard— — — — — — 2 — 2 
Nonaccrual— — — — — — 10 8 18 
Total home equity credit line— — — — — — 2,614 113 2,727 
1-4 family residential
Pass591 1,103 834 636 846 2,178 — — 6,188 
Special Mention— — — — — 1 — — 1 
Accruing Substandard— — — — — 2 — — 2 
Nonaccrual— 6 8 4 14 46 — — 78 
Total 1-4 family residential591 1,109 842 640 860 2,227 — — 6,269 
Construction and other consumer real estate
Pass71 282 176 49 6 8 — — 592 
Special Mention— — — — — — — — — 
Accruing Substandard— 1 — — — — — — 1 
Nonaccrual— — — — — — — — — 
Total construction and other consumer real estate71 283 176 49 6 8 — — 593 
Bankcard and other revolving plans
Pass— — — — — — 410 2 412 
Special Mention— — — — — — — — — 
Accruing Substandard— — — — — — 2 — 2 
Nonaccrual— — — — — — — 1 1 
Total bankcard and other revolving plans— — — — — — 412 3 415 
Other consumer
Pass47 30 24 14 7 3 — — 125 
Special Mention— — — — — — — — — 
Accruing Substandard— — — — — — — — — 
Nonaccrual— — — — — — — — — 
Total other consumer47 30 24 14 7 3 — — 125 
Total consumer709 1,422 1,042 703 873 2,238 3,026 116 10,129 
Total loans$7,206 $10,492 $7,239 $5,016 $3,397 $7,071 $10,322 $655 $51,398 
December 31, 2020
Term loansRevolving loans amortized cost basisRevolving loans converted to term loans amortized cost basis
Amortized cost basis by year of origination
(In millions)20202019201820172016PriorTotal
loans
Commercial:
Commercial and industrial
Pass$2,585 $2,743 $1,903 $829 $296 $228 $3,298 $109 $11,991 
Special Mention79 152 183 98 4 43 110 1 670 
Accruing Substandard123 157 129 44 26 17 141 6 643 
Nonaccrual57 2 10 8 2 15 36 10 140 
Total commercial and industrial2,844 3,054 2,225 979 328 303 3,585 126 13,444 
PPP
Pass5,572 — — — — — — — 5,572 
Total PPP5,572 — — — — — — — 5,572 
Leasing
Pass87 121 44 34 14 5 — — 305 
Special Mention1 — 2 1 — 6 — — 10 
Accruing Substandard2 1 1 1 — — — — 5 
Nonaccrual— — — — — — — — — 
Total leasing90 122 47 36 14 11 — — 320 
Owner-occupied
Pass1,588 1,205 1,167 895 585 1,806 161 11 7,418 
Special Mention72 65 60 60 51 41 9 3 361 
Accruing Substandard28 64 61 37 35 98 6 1 330 
Nonaccrual8 11 15 11 6 23 2 — 76 
Total owner-occupied1,696 1,345 1,303 1,003 677 1,968 178 15 8,185 
Municipal
Pass1,031 827 359 419 68 227 3 — 2,934 
Special Mention— — — — — 8 — — 8 
Accruing Substandard— — — — — 9 — — 9 
Nonaccrual— — — — — — — — — 
Total municipal1,031 827 359 419 68 244 3 — 2,951 
Total commercial11,233 5,348 3,934 2,437 1,087 2,526 3,766 141 30,472 
Commercial real estate:
Construction and land development
Pass558 933 267 41 1 6 423 3 2,232 
Special Mention24 43 11 — — — 5 — 83 
Accruing Substandard— 30 — — — — — — 30 
Nonaccrual— — — — — — — — — 
Total construction and land development582 1,006 278 41 1 6 428 3 2,345 
Term
Pass2,524 1,858 1,639 761 778 1,291 73 20 8,944 
Special Mention110 89 177 42 23 85 — 5 531 
Accruing Substandard41 34 96 30 18 34 — — 253 
Nonaccrual3 5 — 2 1 20 — — 31 
Total term2,678 1,986 1,912 835 820 1,430 73 25 9,759 
Total commercial real estate3,260 2,992 2,190 876 821 1,436 501 28 12,104 
December 31, 2020
Term loansRevolving loans amortized cost basisRevolving loans converted to term loans amortized cost basis
Amortized cost basis by year of origination
(In millions)20202019201820172016PriorTotal
loans
Consumer:
Home equity credit line
Pass— — — — — — 2,606 115 2,721 
Special Mention— — — — — — 2 — 2 
Accruing Substandard— — — — — — 6 — 6 
Nonaccrual— — — — — — 11 5 16 
Total home equity credit line— — — — — — 2,625 120 2,745 
1-4 family residential
Pass1,185 1,017 833 1,081 1,174 1,570 — — 6,860 
Special Mention— — — — — 2 — — 2 
Accruing Substandard— — 1 — 2 1 — — 4 
Nonaccrual2 12 7 19 15 48 — — 103 
Total 1-4 family residential1,187 1,029 841 1,100 1,191 1,621 — — 6,969 
Construction and other consumer real estate
Pass200 296 106 16 1 11 — — 630 
Special Mention— — — — — — — — — 
Accruing Substandard— — — — — — — — — 
Nonaccrual— — — — — — — — — 
Total construction and other consumer real estate200 296 106 16 1 11 — — 630 
Bankcard and other revolving plans
Pass— — — — — — 426 2 428 
Special Mention— — — — — — — — — 
Accruing Substandard— — — — — — 3 — 3 
Nonaccrual— — — — — — — 1 1 
Total bankcard and other revolving plans— — — — — — 429 3 432 
Other consumer
Pass51 35 22 10 4 2 — — 124 
Special Mention— — — — — — — — — 
Accruing Substandard— — — — — — — — — 
Nonaccrual— — — — — — — — — 
Total other consumer51 35 22 10 4 2 — — 124 
Total consumer1,438 1,360 969 1,126 1,196 1,634 3,054 123 10,900 
Total loans$15,931 $9,700 $7,093 $4,439 $3,104 $5,596 $7,321 $292 $53,476 
Modified and Restructured Loans
Loans may be modified in the normal course of business for competitive reasons or to strengthen our collateral position. Loan modifications and restructurings may also occur when the borrower experiences financial difficulty and needs temporary or permanent relief from the original contractual terms of the loan. Loans that have been modified to accommodate a borrower who is experiencing financial difficulties, and for which we have granted a concession that we would not otherwise consider, are considered troubled debt restructurings (“TDRs”).
Consistent with recent accounting and regulatory guidance, loan modifications provided to borrowers experiencing financial difficulties exclusively related to the COVID-19 pandemic, in which we provide certain short-term modifications or payment deferrals, are not classified as TDRs. The TDRs disclosed subsequently do not include
these loan modifications. Other loan modifications above and beyond these short-term modifications or payment deferrals were assessed for TDR classification. For further discussion of our policies and processes regarding TDRs, see Note 6 of our 2020 Form 10-K.
Selected information on TDRs, including the recorded investment on an accruing and nonaccruing basis by loan class and modification type is summarized in the following schedules:
June 30, 2021
Recorded investment resulting from the following modification types:
(In millions)Interest
rate below
market		Maturity
or term
extension		Principal
forgiveness		Payment
deferral
Other 1
Multiple
modification
types 2
Total
Accruing
Commercial:
Commercial and industrial$2 $— $— $— $12 $21 $35 
Owner-occupied5 4 — 8 15 39 71 
Total commercial7 4 — 8 27 60 106 
Commercial real estate:
Construction and land development— 8 — — — — 8 
Term1 26 — 35 96 22 180 
Total commercial real estate1 34 — 35 96 22 188 
Consumer:
Home equity credit line— 1 6 — — 2 9 
1-4 family residential6 1 3 — 1 16 27 
Total consumer loans6 2 9 — 1 18 36 
Total accruing14 40 9 43 124 100 330 
Nonaccruing
Commercial:
Commercial and industrial17 1 — 2 8 45 73 
Owner-occupied5 — — 3 — 17 25 
Total commercial22 1 — 5 8 62 98 
Commercial real estate:
Term2 — — 13 2 5 22 
Total commercial real estate2 — — 13 2 5 22 
Consumer:
Home equity credit line— — 2 — — — 2 
1-4 family residential1 1 1 — — 3 6 
Total consumer loans1 1 3 — — 3 8 
Total nonaccruing25 2 3 18 10 70 128 
Total$39 $42 $12 $61 $134 $170 $458 
1 Includes TDRs that resulted from other modification types including, but not limited to, a legal judgment awarded on different terms, a bankruptcy plan confirmed on different terms, a settlement that includes the delivery of collateral in exchange for debt reduction, etc.
2 Includes TDRs that resulted from a combination of any of the previous modification types.
December 31, 2020
Recorded investment resulting from the following modification types:
(In millions)Interest
rate below
market		Maturity
or term
extension		Principal
forgiveness		Payment
deferral
Other 1
Multiple
modification
types 2
Total
Accruing
Commercial:
Commercial and industrial$— $— $— $— $3 $4 $7 
Owner-occupied5 1 — 4 4 8 22 
Total commercial5 1 — 4 7 12 29 
Commercial real estate:
Term1 — — 16 94 23 134 
Total commercial real estate1 — — 16 94 23 134 
Consumer:
Home equity credit line— 1 7 — — 2 10 
1-4 family residential4 1 3 — 2 15 25 
Total consumer loans4 2 10 — 2 17 35 
Total accruing10 3 10 20 103 52 198 
Nonaccruing
Commercial:
Commercial and industrial— — — 3 10 52 65 
Owner-occupied5 — — 3 — 10 18 
Total commercial5 — — 6 10 62 83 
Commercial real estate:
Term2 — — 13 3 2 20 
Total commercial real estate2 — — 13 3 2 20 
Consumer:
Home equity credit line— — 2 — — — 2 
1-4 family residential1 1 — — — 6 8 
Total consumer loans1 1 2 — — 6 10 
Total nonaccruing8 1 2 19 13 70 113 
Total$18 $4 $12 $39 $116 $122 $311 
1 Includes TDRs that resulted from other modification types including, but not limited to, a legal judgment awarded on different terms, a bankruptcy plan confirmed on different terms, a settlement that includes the delivery of collateral in exchange for debt reduction, etc.
2 Includes TDRs that resulted from a combination of any of the previous modification types.
Unfunded lending commitments on TDRs totaled $27 million and $3 million at June 30, 2021 and December 31, 2020, respectively.
The total recorded investment of all TDRs in which interest rates were modified below market was $107 million at June 30, 2021 and $76 million at December 31, 2020. These loans are included in the previous schedule in the columns for interest rate below market and multiple modification types.
The net financial impact on interest income due to interest rate modifications below market for accruing TDRs for the three and six months ended June 30, 2021 and 2020 was not significant.
On an ongoing basis, we monitor the performance of all TDRs according to their restructured terms. Subsequent payment default is defined in terms of delinquency, when principal or interest payments are past due 90 days or more for commercial loans, or 60 days or more for consumer loans.
The recorded investment of accruing and nonaccruing TDRs that had a payment default during the three and six months ended June 30, 2021, which were still in default at period end, and were within 12 months or less of being modified as TDRs was approximately $3 million and $5 million, respectively, and $2 million and $3 million for the three and six months ended June 30, 2020, respectively.
Collateral-Dependent Loans
As discussed previously, when a loan is individually evaluated for expected credit losses, we estimate a specific reserve for the loan based on the projected present value of the loan’s future cash flows discounted at the loan’s effective interest rate, the observable market price of the loan, or the fair value of the loan’s underlying collateral.
Select information on loans for which the repayment is expected to be provided substantially through the operation or sale of the underlying collateral and the borrower is experiencing financial difficulties, including the type of collateral and the extent to which the collateral secures the loans, is summarized as follows:
June 30, 2021
(Dollar amounts in millions)Amortized costMajor types of collateral
Weighted average LTV 1
Commercial:
Commercial and industrial$21 Single family residential, Agriculture49%
Owner-occupied10 Office building46%
Commercial real estate:
Term11 Multi-family, Hotel/Motel, Retail46%
Consumer:
Home equity credit line6 Single family residential41%
1-4 family residential2 Single family residential49%
Total$50 
1 The fair value is based on the most recent appraisal or other collateral evaluation.
December 31, 2020
(Dollar amounts in millions)Amortized costMajor types of collateral
Weighted average LTV 1
Commercial:
Commercial and industrial$20 Single family residential, Agriculture55%
Owner-occupied10 Office Building47%
Commercial real estate:
Term12 Multi-family, Hotel/Motel, Retail58%
Consumer:
Home equity credit line3 Single family residential34%
1-4 family residential2 Single family residential60%
Total$47 
1 The fair value is based on the most recent appraisal or other collateral evaluation.
Foreclosed Residential Real Estate
At June 30, 2021 and December 31, 2020, we did not have any foreclosed residential real estate property. The amortized cost basis of consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure was $11 million and $10 million for the same periods, respectively.