Credit Quality And Allowance For Credit Losses (Tables)

9 Months Ended

Sep. 30, 2016

Credit Quality And Allowance For Credit Losses [Abstract]

The following table presents an aging analysis of the recorded balance of loans.



	Loans Past Due and Still Accruing
(in millions)	30-59 Days		60-89 Days		90 Days or More		Total		Nonaccrual Loans		Current Loans		Total Loans
September 30, 2016
Business loans:
Commercial	$	68	$	17	$	21	$	106	$	508	$	30,538	$	31,152
Real estate construction:
Commercial Real Estate business line (a)	12		—		—		12		—		2,370		2,382
Other business lines (b)	11		—		—		11		—		350		361
Total real estate construction	23		—		—		23		—		2,720		2,743
Commercial mortgage:
Commercial Real Estate business line (a)	5		1		—		6		8		2,171		2,185
Other business lines (b)	15		8		6		29		36		6,763		6,828
Total commercial mortgage	20		9		6		35		44		8,934		9,013
Lease financing	—		—		—		—		6		642		648
International	1		—		—		1		19		1,283		1,303
Total business loans	112		26		27		165		577		44,117		44,859
Retail loans:
Residential mortgage	13		1		9		23		23		1,828		1,874
Consumer:
Home equity	6		2		—		8		27		1,757		1,792
Other consumer	1		—		12		13		4		732		749
Total consumer	7		2		12		21		31		2,489		2,541
Total retail loans	20		3		21		44		54		4,317		4,415
Total loans	$	132	$	29	$	48	$	209	$	631	$	48,434	$	49,274
December 31, 2015
Business loans:
Commercial	$	46	$	12	$	13	$	71	$	238	$	31,350	$	31,659
Real estate construction:
Commercial Real Estate business line (a)	5		—		—		5		—		1,676		1,681
Other business lines (b)	3		—		—		3		1		316		320
Total real estate construction	8		—		—		8		1		1,992		2,001
Commercial mortgage:
Commercial Real Estate business line (a)	7		—		1		8		16		2,080		2,104
Other business lines (b)	7		5		3		15		44		6,814		6,873
Total commercial mortgage	14		5		4		23		60		8,894		8,977
Lease financing	—		—		—		—		6		718		724
International	2		—		—		2		8		1,358		1,368
Total business loans	70		17		17		104		313		44,312		44,729
Retail loans:
Residential mortgage	26		1		—		27		27		1,816		1,870
Consumer:
Home equity	5		3		—		8		27		1,685		1,720
Other consumer	7		—		—		7		—		758		765
Total consumer	12		3		—		15		27		2,443		2,485
Total retail loans	38		4		—		42		54		4,259		4,355
Total loans	$	108	$	21	$	17	$	146	$	367	$	48,571	$	49,084


(a)	Primarily loans to real estate developers.


(b)	Primarily loans secured by owner-occupied real estate.

Loans By Credit Quality Indicator

The following table presents loans by credit quality indicator, based on internal risk ratings assigned to each business loan at the time of approval and subjected to subsequent reviews, generally at least annually, and to pools of retail loans with similar risk characteristics.



	Internally Assigned Rating
(in millions)	Pass (a)		Special Mention (b)		Substandard (c)		Nonaccrual (d)		Total
September 30, 2016
Business loans:
Commercial	$	28,406	$	965	$	1,273	$	508	$	31,152
Real estate construction:
Commercial Real Estate business line (e)	2,382		—		—		—		2,382
Other business lines (f)	358		3		—		—		361
Total real estate construction	2,740		3		—		—		2,743
Commercial mortgage:
Commercial Real Estate business line (e)	2,141		16		20		8		2,185
Other business lines (f)	6,529		136		127		36		6,828
Total commercial mortgage	8,670		152		147		44		9,013
Lease financing	625		11		6		6		648
International	1,230		20		34		19		1,303
Total business loans	41,671		1,151		1,460		577		44,859
Retail loans:
Residential mortgage	1,838		3		10		23		1,874
Consumer:
Home equity	1,760		2		3		27		1,792
Other consumer	744		1		—		4		749
Total consumer	2,504		3		3		31		2,541
Total retail loans	4,342		6		13		54		4,415
Total loans	$	46,013	$	1,157	$	1,473	$	631	$	49,274
December 31, 2015
Business loans:
Commercial	$	29,117	$	1,293	$	1,011	$	238	$	31,659
Real estate construction:
Commercial Real Estate business line (e)	1,681		—		—		—		1,681
Other business lines (f)	318		1		—		1		320
Total real estate construction	1,999		1		—		1		2,001
Commercial mortgage:
Commercial Real Estate business line (e)	2,031		31		26		16		2,104
Other business lines (f)	6,536		172		121		44		6,873
Total commercial mortgage	8,567		203		147		60		8,977
Lease financing	693		17		8		6		724
International	1,245		59		56		8		1,368
Total business loans	41,621		1,573		1,222		313		44,729
Retail loans:
Residential mortgage	1,828		2		13		27		1,870
Consumer:
Home equity	1,687		1		5		27		1,720
Other consumer	755		3		7		—		765
Total consumer	2,442		4		12		27		2,485
Total retail loans	4,270		6		25		54		4,355
Total loans	$	45,891	$	1,579	$	1,247	$	367	$	49,084


(a)	Includes all loans not included in the categories of special mention, substandard or nonaccrual.


(b)	Special mention loans are accruing loans that have potential credit weaknesses that deserve management’s close attention, such as loans to borrowers who may be experiencing financial difficulties that may result in deterioration of repayment prospects from the borrower at some future date.

(c)

Substandard loans are accruing loans that have a well-defined weakness, or weaknesses, such as loans to borrowers who may be experiencing losses from operations or inadequate liquidity of a degree and duration that jeopardizes the orderly repayment of the loan. Substandard loans also are distinguished by the distinct possibility of loss in the future if these weaknesses are not corrected. This category is generally consistent with the "substandard" category as defined by regulatory authorities.

(d)

Nonaccrual loans are loans for which the accrual of interest has been discontinued. For further information regarding nonaccrual loans, refer to the Nonperforming Assets subheading in Note 1 - Basis of Presentation and Accounting Policies - on page F-58 in the Corporation's 2015 Annual Report. A significant majority of nonaccrual loans are generally consistent with the "substandard" category and the remainder are generally consistent with the "doubtful" category as defined by regulatory authorities.


(e)	Primarily loans to real estate developers.


(f)	Primarily loans secured by owner-occupied real estate.

Schedule Of Nonaccrual, Reduced-Rate Loans And Foreclosed Property

The following table summarizes nonperforming assets.



(in millions)	September 30, 2016		December 31, 2015
Nonaccrual loans	$	631	$	367
Reduced-rate loans (a)	8		12
Total nonperforming loans	639		379
Foreclosed property (b)	21		12
Total nonperforming assets	$	660	$	391


(a)	There were no reduced-rate business loans at both September 30, 2016 and December 31, 2015. Reduced-rate retail loans were $8 million and $12 million at September 30, 2016 and December 31, 2015, respectively.


(b)	Included $5 million and $9 million of foreclosed residential real estate properties at September 30, 2016 and December 31, 2015, respectively.

Changes In The Allowance For Loan Losses And Related Loan Amounts

The following table details the changes in the allowance for loan losses and related loan amounts.



	2016									2015
(in millions)	Business Loans			Retail Loans			Total			Business Loans			Retail Loans			Total

Three Months Ended September 30
Allowance for loan losses:
Balance at beginning of period	$	682		$	47		$	729		$	563		$	55		$	618
Loan charge-offs	(34		)	(1		)	(35		)	(31		)	(3		)	(34		)
Recoveries on loans previously charged-off	18			1			19			10			1			11
Net loan charge-offs	(16		)	—			(16		)	(21		)	(2		)	(23		)
Provision for loan losses	12			2			14			25			3			28
Foreign currency translation adjustment	—			—			—			(1		)	—			(1		)
Balance at end of period	$	678		$	49		$	727		$	566		$	56		$	622

Nine Months Ended September 30
Allowance for loan losses:
Balance at beginning of period	$	579		$	55		$	634		$	534		$	60		$	594
Loan charge-offs	(161		)	(5		)	(166		)	(83		)	(9		)	(92		)
Recoveries on loans previously charged-off	53			3			56			38			5			43
Net loan charge-offs	(108		)	(2		)	(110		)	(45		)	(4		)	(49		)
Provision for loan losses	206			(4		)	202			79			—			79
Foreign currency translation adjustment	1			—			1			(2		)	—			(2		)
Balance at end of period	$	678		$	49		$	727		$	566		$	56		$	622

As a percentage of total loans	1.51		%	1.10		%	1.48		%	1.27		%	1.29		%	1.27		%

September 30
Allowance for loan losses:
Individually evaluated for impairment	$	115		$	1		$	116		$	47		$	—		$	47
Collectively evaluated for impairment	563			48			611			519			56			575
Total allowance for loan losses	$	678		$	49		$	727		$	566		$	56		$	622
Loans:
Individually evaluated for impairment	$	677		$	29		$	706		$	338		$	51		$	389
Collectively evaluated for impairment	44,182			4,386			48,568			44,233			4,318			48,551
Purchased credit impaired (PCI) loans (a)	—			—			—			—			2			2
Total loans evaluated for impairment	$	44,859		$	4,415		$	49,274		$	44,571		$	4,371		$	48,942


(a)	No allowance for loan losses was required for PCI loans at September 30, 2015.

Changes In the Allowance For Credit Losses On Lending-Related Commitments

Changes in the allowance for credit losses on lending-related commitments, included in "accrued expenses and other liabilities" on the consolidated balance sheets, are summarized in the following table.



	Three Months Ended September 30,					Nine Months Ended September 30,
(in millions)	2016		2015			2016			2015
Balance at beginning of period	$	43	$	50		$	45		$	41
Charge-offs on lending related commitments (a)	—		—			(11		)	(1		)
Provision for credit losses on lending-related commitments	2		(2		)	11			8
Balance at end of period	$	45	$	48		$	45		$	48

(a) Charge-offs result from the sale of unfunded lending-related commitments.

Individually Evaluated Impaired Loans

The following table presents additional information regarding individually evaluated impaired loans.



	Recorded Investment In:
(in millions)	Impaired Loans with No Related Allowance		Impaired Loans with Related Allowance		Total Impaired Loans		Unpaid Principal Balance		Related Allowance for Loan Losses
September 30, 2016
Business loans:
Commercial	$	141	$	482	$	623	$	704	$	106
Commercial mortgage:
Commercial Real Estate business line (a)	—		6		6		15		1
Other business lines (b)	4		25		29		43		3
Total commercial mortgage	4		31		35		58		4
International	3		16		19		26		5
Total business loans	148		529		677		788		115
Retail loans:
Residential mortgage	12		—		12		13		—
Consumer:
Home equity	12		—		12		16		—
Other consumer	2		3		5		6		1
Total consumer	14		3		17		22		1
Total retail loans (c)	26		3		29		35		1
Total individually evaluated impaired loans	$	174	$	532	$	706	$	823	$	116
December 31, 2015
Business loans:
Commercial	$	82	$	252	$	334	$	398	$	45
Commercial mortgage:
Commercial Real Estate business line (a)	7		8		15		38		1
Other business lines (b)	2		32		34		55		5
Total commercial mortgage	9		40		49		93		6
International	—		10		10		17		2
Total business loans	91		302		393		508		53
Retail loans:
Residential mortgage	13		—		13		13		—
Consumer:
Home equity	12		—		12		16		—
Other consumer	6		—		6		10		—
Total consumer	18		—		18		26		—
Total retail loans (c)	31		—		31		39		—
Total individually evaluated impaired loans	$	122	$	302	$	424	$	547	$	53


(a)	Primarily loans to real estate developers.


(b)	Primarily loans secured by owner-occupied real estate.


(c)	Individually evaluated retail loans generally have no related allowance for loan losses, primarily due to policy which results in direct write-downs of most restructured retail loans.

Average Individually Evaluated Impaired Loans And Related Interest Recognized

The following table presents information regarding average individually evaluated impaired loans and the related interest recognized. Interest income recognized for the period primarily related to performing restructured loans.



	Individually Evaluated Impaired Loans
	2016				2015
(in millions)	Average Balance for the Period		Interest Income Recognized for the Period		Average Balance for the Period		Interest Income Recognized for the Period
Three Months Ended September 30
Business loans:
Commercial	$	606	$	2	$	236	$	1
Commercial mortgage:
Commercial Real Estate business line (a)	7		—		15		—
Other business lines (b)	30		—		37		1
Total commercial mortgage	37		—		52		1
International	19		—		10		—
Total business loans	662		2		298		2
Retail loans:
Residential mortgage	11		—		23		—
Consumer loans:
Home equity	12		—		12		—
Other consumer	4		—		7		—
Total consumer	16		—		19		—
Total retail loans	27		—		42		—
Total individually evaluated impaired loans	$	689	$	2	$	340	$	2
Nine Months Ended September 30
Business loans:
Commercial	$	559	$	8	$	172	$	3
Commercial mortgage:
Commercial Real Estate business line (a)	9		—		17		—
Other business lines (b)	31		—		41		1
Total commercial mortgage	40		—		58		1
International	19		—		5		—
Total business loans	618		8		235		4
Retail loans:
Residential mortgage	12		—		23		—
Consumer:
Home equity	12		—		12		—
Other consumer	4		—		6		—
Total consumer	16		—		18		—
Total retail loans	28		—		41		—
Total individually evaluated impaired loans	$	646	$	8	$	276	$	4


(a)	Primarily loans to real estate developers.


(b)	Primarily loans secured by owner-occupied real estate.

Troubled Debt Restructurings By Type Of Modification

The following tables detail the recorded balance at September 30, 2016 and 2015 of loans considered to be troubled debt restructurings (TDRs) that were restructured during the three- and nine-month periods ended September 30, 2016 and 2015, by type of modification. In cases of loans with more than one type of modification, the loans were categorized based on the most significant modification.



	2016								2015
	Type of Modification								Type of Modification
(in millions)	Principal Deferrals (a)		Interest Rate Reductions		AB Note Restructures (b)		Total Modifications		Principal Deferrals (a)		Interest Rate Reductions		Total Modifications
Three Months Ended September 30
Business loans:
Commercial	$	70	$	—	$	40	$	110	$	100	$	—	$	100
Commercial mortgage:
Commercial Real Estate business line (c)	—		—		—		—		7		—		7
Other business lines (d)	—		—		—		—		3		—		3
Total commercial mortgage	—		—		—		—		10		—		10
International	—		—		—		—		2		—		2
Total business loans	70		—		40		110		112		—		112
Retail loans:
Residential mortgage	—		—		—		—		18		—		18
Consumer:
Home equity	—		—		—		—		1		1		2
Total retail loans	—		—		—		—		19		1		20
Total loans	$	70	$	—	$	40	$	110	$	131	$	1	$	132
Nine Months Ended September 30
Business loans:
Commercial	$	150	$	—	$	49	$	199	$	102	$	—	$	102
Commercial mortgage:
Commercial Real Estate business line (c)	—		—		—		—		9		—		9
Other business lines (d)	2		—		—		2		7		—		7
Total commercial mortgage	2		—		—		2		16		—		16
International	—		—		3		3		2		—		2
Total business loans	152		—		52		204		120		—		120
Retail loans:
Residential mortgage	—		—		—		—		18		—		18
Consumer:
Home equity	1		1		—		2		1		1		2
Total retail loans	1		1		—		2		19		1		20
Total loans	$	153	$	1	$	52	$	206	$	139	$	1	$	140


(a)	Primarily represents loan balances where terms were extended 90 days or more at or above contractual interest rates.


(b)	Loan restructurings whereby the original loan is restructured into two notes: an "A" note, which generally reflects the portion of the modified loan which is expected to be collected; and a "B" note, which is generally fully charged off.


(c)	Primarily loans to real estate developers.


(d)	Primarily loans secured by owner-occupied real estate.

Troubled Debt Restructuring Subsequent Default

The following table presents information regarding the recorded balance at September 30, 2016 and 2015 of loans modified by principal deferral during the twelve-month periods ended September 30, 2016 and 2015, and those principal deferrals which experienced a subsequent default during the three- and nine-month periods ended September 30, 2016 and 2015. For principal deferrals, incremental deterioration in the credit quality of the loan, represented by a downgrade in the risk rating of the loan, for example, due to missed interest payments or a reduction of collateral value, is considered a subsequent default.



	2016							2015
(in millions)	Balance at September 30			Subsequent Default in the Three Months Ended September 30		Subsequent Default in the Nine Months Ended September 30		Balance at September 30			Subsequent Default in the Three Months Ended September 30		Subsequent Default in the Nine Months Ended September 30
Principal deferrals:
Business loans:
Commercial	$	229		$	—	$	13	$	108		$	1	$	3
Commercial mortgage:
Commercial Real Estate business line (a)	—			—		—		9			—		—
Other business lines (b)	4			—		1		7			—		1
Total commercial mortgage	4			—		1		16			—		1
International	—			—		—		2			—		—
Total business loans	233			—		14		126			1		4
Retail loans:
Residential mortgage	—			—		—		18		(c)	—		—
Consumer:
Home equity	1		(c)	—		—		1		(c)	—		—
Total retail loans	1			—		—		19			—		—
Total principal deferrals	$	234		$	—	$	14	$	145		$	1	$	4


(a)	Primarily loans to real estate developers.


(b)	Primarily loans secured by owner-occupied real estate.


(c)	Includes bankruptcy loans for which the court has discharged the borrower's obligation and the borrower has not reaffirmed the debt.