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Credit Quality and the Allowance for Loan and Lease Losses (Tables)

6 Months Ended

Jun. 30, 2016

Credit Quality and the Allowance for Loan and Leases Losses


Allowance for Loan and Lease Losses
The following tables summarize transactions in the ALLL by portfolio segment:

				Residential
For the three months ended June 30, 2016 ($ in millions)			Commercial	Mortgage	Consumer	Unallocated	Total
Balance, beginning of period		$	867	98	214	116	1,295
	Losses charged-off		(51)	(5)	(49)	-	(105)
	Recoveries of losses previously charged-off		5	3	10	-	18
	Provision for loan and lease losses		52	2	36	1	91
Balance, end of period		$	873	98	211	117	1,299

				Residential
For the three months ended June 30, 2015 ($ in millions)			Commercial	Mortgage	Consumer	Unallocated	Total
Balance, beginning of period		$	852	103	241	104	1,300
	Losses charged-off		(54)	(8)	(50)	-	(112)
	Recoveries of losses previously charged-off		9	3	14	-	26
	Provision for loan and lease losses		48	6	26	(1)	79
Balance, end of period		$	855	104	231	103	1,293

				Residential
For the six months ended June 30, 2016 ($ in millions)			Commercial	Mortgage	Consumer	Unallocated	Total
Balance, beginning of period		$	840	100	217	115	1,272
	Losses charged-off		(112)	(10)	(100)	-	(222)
	Recoveries of losses previously charged-off		11	5	23	-	39
	Provision for loan and lease losses		134	3	71	2	210
Balance, end of period		$	873	98	211	117	1,299

				Residential
For the six months ended June 30, 2015 ($ in millions)			Commercial	Mortgage	Consumer	Unallocated	Total
Balance, beginning of period		$	875	104	237	106	1,322
	Losses charged-off		(102)	(17)	(108)	-	(227)
	Recoveries of losses previously charged-off		18	6	26	-	50
	Provision for loan and lease losses		64	11	76	(3)	148
Balance, end of period		$	855	104	231	103	1,293

Summary of the ALLL and Related Loans and Leases Classified by Portfolio Segment

The following tables provide a summary of the ALLL and related loans and leases classified by portfolio segment:

					Residential
As of June 30, 2016 ($ in millions)			Commercial		Mortgage	Consumer	Unallocated	Total
ALLL:^(a)
	Individually evaluated for impairment	$	97	^(c)	67	46	-	210
	Collectively evaluated for impairment		776		31	165	-	972
	Unallocated		-		-	-	117	117
Total ALLL		$	873		98	211	117	1,299
Portfolio loans and leases:^(b)
	Individually evaluated for impairment	$	1,011	^(c)	649	399	-	2,059
	Collectively evaluated for impairment		57,106		13,501	21,086	-	91,693
	Loans acquired with deteriorated credit quality		-		3	-	-	3
Total portfolio loans and leases		$	58,117		14,153	21,485	-	93,755

Includes $3 related to leveraged leases at June 30, 2016.
Excludes $154 of residential mortgage loans measured at fair value, and includes $818 of leveraged leases, net of unearned income at June 30, 2016.
Includes five restructured loans at June 30, 2016 associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with a recorded investment of $27 and an ALLL of $18.


					Residential
As of December 31, 2015 ($ in millions)			Commercial		Mortgage	Consumer	Unallocated	Total
ALLL:^(a)
	Individually evaluated for impairment	$	119	^(c)	67	49	-	235
	Collectively evaluated for impairment		721		33	168	-	922
	Unallocated		-		-	-	115	115
Total ALLL		$	840		100	217	115	1,272
Portfolio loans and leases:^(b)
	Individually evaluated for impairment	$	815	^(c)	630	424	-	1,869
	Collectively evaluated for impairment		55,341		12,917	22,286	-	90,544
	Loans acquired with deteriorated credit quality		-		2	-	-	2
Total portfolio loans and leases		$	56,156		13,549	22,710	-	92,415

Includes $5 related to leveraged leases at December 31, 2015.
Excludes $167 of residential mortgage loans measured at fair value, and includes $801 of leveraged leases, net of unearned income at December 31, 2015.
Includes five restructured loans at December 31, 2015 associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with a recorded investment of $27 and an ALLL of $15.

Loan and leases balances by credit quality indicator

The following tables summarize the credit risk profile of the Bancorp’s commercial portfolio segment, by class:

			Special
As of June 30, 2016 ($ in millions)		Pass	Mention	Substandard	Doubtful	Total
Commercial and industrial loans	$	39,995	1,588	1,975	-	43,558
Commercial mortgage owner-occupied loans		3,263	102	157	-	3,522
Commercial mortgage nonowner-occupied loans		3,220	30	103	-	3,353
Commercial construction loans		3,705	1	-	-	3,706
Commercial leases		3,894	50	34	-	3,978
Total commercial loans and leases	$	54,077	1,771	2,269	-	58,117

			Special
As of December 31, 2015 ($ in millions)		Pass	Mention	Substandard	Doubtful	Total
Commercial and industrial loans	$	38,756	1,633	1,742	-	42,131
Commercial mortgage owner-occupied loans		3,344	124	191	-	3,659
Commercial mortgage nonowner-occupied loans		3,105	63	130	-	3,298
Commercial construction loans		3,201	4	9	-	3,214
Commercial leases		3,724	93	37	-	3,854
Total commercial loans and leases	$	52,130	1,917	2,109	-	56,156

The following table presents a summary of the Bancorp’s residential mortgage and consumer portfolio segments, by class, disaggregated into performing versus nonperforming status as of:

		June 30, 2016		December 31, 2015
($ in millions)		Performing	Nonperforming	Performing	Nonperforming
Residential mortgage loans^(a)	$	14,110	43	13,498	51
Home equity		7,909	79	8,222	79
Automobile loans		10,669	2	11,491	2
Credit card		2,142	30	2,226	33
Other consumer loans and leases		654	-	657	-
Total residential mortgage and consumer loans and leases^(a)	$	35,484	154	36,094	165

(a) Excludes $154 and $167 of loans measured at fair value at June 30, 2016 and December 31, 2015, respectively.

Summary by Age and Class of the Recorded Investment in Delinquencies Included in the Bancorp's Portfolio of Loans and Leases

Age Analysis of Past Due Loans and Leases
The following tables summarize the Bancorp’s recorded investment in portfolio loans and leases, by age and class:

			Current	Past Due				90 Days Past
			Loans and	30-89	90 Days	Total	Total Loans	Due and Still
As of June 30, 2016 ($ in millions)			Leases^(c)	Days^(c)	or More^(c)	Past Due	and Leases	Accruing
Commercial loans and leases:
	Commercial and industrial loans	$	43,415	43	100	143	43,558	2
	Commercial mortgage owner-occupied loans		3,488	9	25	34	3,522	-
	Commercial mortgage nonowner-occupied loans		3,331	-	22	22	3,353	-
	Commercial construction loans		3,706	-	-	-	3,706	-
	Commercial leases		3,975	-	3	3	3,978	-
Residential mortgage loans^(a)(b)			14,039	33	81	114	14,153	38
Consumer loans and leases:
	Home equity		7,862	68	58	126	7,988	-
	Automobile loans		10,595	67	9	76	10,671	7
	Credit card		2,124	25	23	48	2,172	18
	Other consumer loans and leases		653	1	-	1	654	-
Total portfolio loans and leases^(a)		$	93,188	246	321	567	93,755	65

Excludes $154 of residential mortgage loans measured at fair value at June 30, 2016.
Information includes advances made pursuant to servicing agreements for GNMA mortgage pools whose repayments are insured by the FHA or guaranteed by the VA. As of June 30, 2016, $108 of these loans were 30-89 days past due and $284 were 90 days or more past due. The Bancorp recognized $1 and $3 of losses during the three and six months ended June 30, 2016, respectively, due to claim denials and curtailments associated with these insured or guaranteed loans.
Includes accrual and nonaccrual loans and leases.

			Current	Past Due				90 Days Past
			Loans and	30-89	90 Days	Total	Total Loans	Due and Still
As of December 31, 2015 ($ in millions)			Leases^(c)	Days^(c)	or More^(c)	Past Due	and Leases	Accruing
Commercial loans and leases:
	Commercial and industrial loans	$	41,996	55	80	135	42,131	7
	Commercial mortgage owner-occupied loans		3,610	15	34	49	3,659	-
	Commercial mortgage nonowner-occupied loans		3,262	9	27	36	3,298	-
	Commercial construction loans		3,214	-	-	-	3,214	-
	Commercial leases		3,850	3	1	4	3,854	-
Residential mortgage loans^(a)(b)			13,420	37	92	129	13,549	40
Consumer loans and leases:
	Home equity		8,158	82	61	143	8,301	-
	Automobile loans		11,407	75	11	86	11,493	10
	Credit card		2,207	29	23	52	2,259	18
	Other consumer loans and leases		656	1	-	1	657	-
Total portfolio loans and leases^(a)		$	91,780	306	329	635	92,415	75

Excludes $167 of residential mortgage loans measured at fair value at December 31, 2015.
Information includes advances made pursuant to servicing agreements for GNMA mortgage pools whose repayments are insured by the FHA or guaranteed by the VA. As of December 31, 2015, $102 of these loans were 30-89 days past due and $335 were 90 days or more past due. The Bancorp recognized $2 and $4 of losses during the three and six months ended June 30, 2015, respectively, due to claim denials and curtailments associated with these insured or guaranteed loans.
Includes accrual and nonaccrual loans and leases.

Summarizes the Bancorp's Recorded Investment in Impaired Loans and Related Allowance by Class

The following tables summarize the Bancorp’s impaired portfolio loans and leases, by class, that were subject to individual review, which includes all portfolio loans and leases restructured in a TDR:

			Unpaid
			Principal	Recorded
As of June 30, 2016 ($ in millions)			Balance	Investment		ALLL
With a related ALLL:
Commercial loans and leases:
	Commercial and industrial loans	$	442	360		73
	Commercial mortgage owner-occupied loans^(b)		25	17		2
	Commercial mortgage nonowner-occupied loans		62	54		4
Restructured residential mortgage loans			458	445		67
Restructured consumer loans and leases:
	Home equity		216	215		32
	Automobile loans		15	15		2
	Credit card		56	56		12
Total impaired portfolio loans and leases with a related ALLL		$	1,274	1,162		192
With no related ALLL:
Commercial loans and leases:
	Commercial and industrial loans	$	472	403		-
	Commercial mortgage owner-occupied loans		52	47		-
	Commercial mortgage nonowner-occupied loans		109	96		-
	Commercial leases		7	7		-
Restructured residential mortgage loans			218	204		-
Restructured consumer loans and leases:
	Home equity		114	111		-
	Automobile loans		3	2		-
Total impaired portfolio loans and leases with no related ALLL		$	975	870		-
Total impaired portfolio loans and leases		$	2,249	2,032	a^(a)	192

Includes $431, $633 and $349, respectively, of commercial, residential mortgage and consumer portfolio TDRs on accrual status and $242, $16 and $50, respectively, of commercial, residential mortgage and consumer portfolio TDRs on nonaccrual status at June 30, 2016.
Excludes five restructured loans at June 30, 2016 associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with an unpaid principal balance of $27, a recorded investment of $27 and an ALLL of $18.


			Unpaid
			Principal	Recorded
As of December 31, 2015 ($ in millions)			Balance	Investment		ALLL
With a related ALLL:
Commercial loans and leases:
	Commercial and industrial loans	$	412	346		84
	Commercial mortgage owner-occupied loans^(b)		28	21		5
	Commercial mortgage nonowner-occupied loans		75	64		12
	Commercial construction loans		4	4		2
	Commercial leases		3	3		1
Restructured residential mortgage loans			450	444		67
Restructured consumer loans and leases:
	Home equity		226	225		32
	Automobile loans		17	16		2
	Credit card		61	61		15
Total impaired portfolio loans and leases with a related ALLL		$	1,276	1,184		220
With no related ALLL:
Commercial loans and leases:
	Commercial and industrial loans	$	228	182		-
	Commercial mortgage owner-occupied loans		54	51		-
	Commercial mortgage nonowner-occupied loans		126	111		-
	Commercial construction loans		9	5		-
	Commercial leases		1	1		-
Restructured residential mortgage loans			210	186		-
Restructured consumer loans and leases:
	Home equity		122	119		-
	Automobile loans		3	3		-
Total impaired portfolio loans and leases with no related ALLL		$	753	658		-
Total impaired portfolio loans and leases		$	2,029	1,842	a^(a)	220

Includes $491, $607 and $372, respectively, of commercial, residential mortgage and consumer portfolio TDRs on accrual status and $203, $23 and $52, respectively, of commercial, residential mortgage and consumer portfolio TDRs on nonaccrual status at December 31, 2015.
Excludes five restructured loans at December 31, 2015 associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with an unpaid principal balance of $27, a recorded investment of $27 and an ALLL of $15.


The following tables summarize the Bancorp’s average impaired portfolio loans and leases, by class, and interest income, by class:

			For the three months ended		For the six months ended
			June 30, 2016		June 30, 2016
			Average	Interest	Average	Interest
			Recorded	Income	Recorded	Income
($ in millions)			Investment	Recognized	Investment	Recognized
Commercial loans and leases:
	Commercial and industrial loans	$	762	2	684	4
	Commercial mortgage owner-occupied loans^(a)		68	-	69	1
	Commercial mortgage nonowner-occupied loans		152	1	160	3
	Commercial construction loans		2	-	4	-
	Commercial leases		6	-	5	-
Restructured residential mortgage loans			651	6	644	12
Restructured consumer loans and leases:
	Home equity		329	3	336	6
	Automobile loans		18	-	18	-
	Credit card		57	1	58	3
Total average impaired portfolio loans and leases		$	2,045	13	1,978	29

(a) Excludes five restructured loans associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with an average recorded investment of $27 and an immaterial amount of interest income recognized for both the three and six months ended June 30, 2016.


			For the three months ended			For the six months ended
			June 30, 2015			June 30, 2015
			Average	Interest		Average	Interest
			Recorded	Income		Recorded	Income
($ in millions)			Investment	Recognized		Investment	Recognized
Commercial loans and leases:
	Commercial and industrial loans	$	731	6	$	741	12
	Commercial mortgage owner-occupied loans^(a)		98	-		103	1
	Commercial mortgage nonowner-occupied loans		222	2		244	3
	Commercial construction loans		61	-		62	1
	Commercial leases		7	-		6	-
Restructured residential mortgage loans			579	6		563	11
Restructured consumer loans and leases:
	Home equity		363	3		370	7
	Automobile loans		22	-		23	-
	Credit card		69	1		72	3
Total average impaired loans and leases		$	2,152	18	$	2,184	38

(a) Excludes five restructured loans associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party, with an average recorded investment of $28 and an immaterial amount of interest income recognized for both the three and six months ended June 30, 2015.

Summary of the Bancorp's Nonperforming Loans and Leases by Class


Nonperforming Assets
Nonperforming assets include nonaccrual loans and leases for which ultimate collectability of the full amount of the principal and/or interest is uncertain; restructured commercial and credit card loans which have not yet met the requirements to be classified as a performing asset; restructured consumer loans which are 90 days past due based on the restructured terms unless the loan is both well-secured and in the process of collection; and certain other assets, including OREO and other repossessed property. The following table presents the Bancorp’s nonaccrual loans and leases, by class, and OREO and other repossessed property as of:

			June 30,	December 31,
($ in millions)			2016	2015
Commercial loans and leases:
	Commercial and industrial loans	$	467	259
	Commercial mortgage owner-occupied loans^(a)		41	46
	Commercial mortgage nonowner-occupied loans		27	35
	Commercial leases		4	1
Total nonaccrual portfolio commercial loans and leases			539	341
Residential mortgage loans			43	51
Consumer loans and leases:
	Home equity		79	79
	Automobile loans		2	2
	Credit card		30	33
Total nonaccrual portfolio consumer loans and leases			111	114
Total nonaccrual portfolio loans and leases^(b)(c)		$	693	506
OREO and other repossessed property			112	141	a
Total nonperforming portfolio assets^(b)(c)		$	805	647

Excludes $20 of restructured nonaccrual loans at both June 30, 2016 and December 31, 2015 associated with a consolidated VIE in which the Bancorp has no continuing credit risk due to the risk being assumed by a third party.
Excludes $20 and $12 of nonaccrual loans held for sale at June 30, 2016 and December 31, 2015, respectively.
Includes $4 and $6 of nonaccrual government insured commercial loans whose repayments are insured by the SBA at June 30, 2016 and December 31, 2015, respectively, and $1 and $2 of restructured nonaccrual government insured commercial loans at June 30, 2016 and December 31, 2015, respectively.

Summary of Loans Modified in a TDR

The following tables provide a summary of loans, by class, modified in a TDR by the Bancorp during the three months ended:

			Recorded investment
		Number of loans	in loans modified		Increase	Charge-offs
		modified in a TDR	in a TDR		to ALLL upon	recognized upon
June 30, 2016 ($ in millions)^(a)		during the period^(b)	during the period		modification	modification
Commercial loans:
	Commercial and industrial loans	20	$	61	11	-
	Commercial mortgage owner-occupied loans	3		2	-	-
	Commercial mortgage nonowner-occupied loans	2		5	1	-
Residential mortgage loans		262		37	2	-
Consumer loans:
	Home equity	62		2	-	-
	Automobile loans	58		1	-	-
	Credit card	2,262		11	2	1
Total portfolio loans		2,669	$	119	16	1

Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality which were accounted for within a pool.
Represents number of loans post-modification and excludes loans previously modified in a TDR.

			Recorded investment		Increase
		Number of loans	in loans modified		(Decrease)	Charge-offs
		modified in a TDR	in a TDR		to ALLL upon	recognized upon
June 30, 2015 ($ in millions)^(a)		during the period^(b)	during the period		modification	modification
Commercial loans:
	Commercial and industrial loans	27	$	70	7	-
	Commercial mortgage owner-occupied loans	6		7	(1)	-
	Commercial mortgage nonowner-occupied loans	5		4	-	-
Residential mortgage loans		254		35	3	-
Consumer loans:
	Home equity	67		3	(1)	-
	Automobile loans	128		2	-	-
	Credit card	2,981		15	3	3
Total portfolio loans		3,468	$	136	11	3

Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality which were accounted for within a pool.
Represents number of loans post-modification and excludes loans previously modified in a TDR.

The following tables provide a summary of loans modified in a TDR by the Bancorp during the six months ended:

			Recorded investment		Increase
		Number of loans	in loans modified		(Decrease)	Charge-offs
		modified in a TDR	in a TDR		to ALLL upon	recognized upon
June 30, 2016 ($ in millions)^(a)		during the period^(b)	during the period		modification	modification
Commercial loans:
	Commercial and industrial loans	44	$	117	9	-
	Commercial mortgage owner-occupied loans	10		8	(2)	-
	Commercial mortgage nonowner-occupied loans	4		5	1	-
Residential mortgage loans		505		73	4	-
Consumer loans:
	Home equity	126		7	-	-
	Automobile loans	136		2	-	-
	Credit card	4,854		23	4	2
Total portfolio loans		5,679	$	235	16	2

Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality which were accounted for within a pool.
Represents number of loans post-modification and excludes loans previously modified in a TDR.

			Recorded investment		Increase
		Number of loans	in loans modified		(Decrease)	Charge-offs
		modified in a TDR	in a TDR		to ALLL upon	recognized upon
June 30, 2015 ($ in millions)^(a)		during the period^(b)	during the period		modification	modification
Commercial loans:
	Commercial and industrial loans	48	$	88	-	3
	Commercial mortgage owner-occupied loans	13		15	(2)	-
	Commercial mortgage nonowner-occupied loans	11		7	-	-
Residential mortgage loans		554		77	4	-
Consumer loans:
	Home equity	143		7	(1)	-
	Automobile loans	259		4	-	-
	Credit card	6,648		34	7	3
Total portfolio loans		7,676	$	232	8	6

Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality which were accounted for within a pool.
Represents number of loans post-modification and excludes loans previously modified in a TDR.

Summary of Subsequent Defaults

The following tables provide a summary of TDRs that subsequently defaulted during the three months ended June 30, 2016 and 2015 and were within twelve months of the restructuring date:

		Number of		Recorded
June 30, 2016 ($ in millions)^(a)		Contracts		Investment
Commercial loans:
	Commercial and industrial loans	2	$	3
	Commercial mortgage nonowner-occupied loans	1		-
Residential mortgage loans		33		5
Consumer loans:
	Home equity	2		-
	Credit card	351		1
Total portfolio loans		389	$	9

(a) Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality.

		Number of		Recorded
June 30, 2015 ($ in millions)^(a)		Contracts		Investment
Commercial loans:
	Commercial and industrial loans	4	$	7
Residential mortgage loans		30		4
Consumer loans:
	Home equity	3		-
	Automobile loans	4		-
	Credit card	557		3
Total portfolio loans		598	$	14

(a) Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality.

The following tables provide a summary of TDRs that subsequently defaulted during the six months ended June 30, 2016 and 2015 and were within twelve months of the restructuring date:

		Number of		Recorded
June 30, 2016 ($ in millions)^(a)		Contracts		Investment
Commercial loans:
	Commercial and industrial loans	3	$	3
	Commercial mortgage nonowner-occupied loans	2		-
Residential mortgage loans		86		12
Consumer loans:
	Home equity	8		1
	Credit card	774		3
Total portfolio loans		873	$	19

(a) Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality.

		Number of		Recorded
June 30, 2015 ($ in millions)^(a)		Contracts		Investment
Commercial loans:
	Commercial and industrial loans	4	$	7
Residential mortgage loans		70		9
Consumer loans:
	Home equity	8		-
	Automobile loans	8		-
	Credit card	1,145		6
Total portfolio loans		1,235	$	22

(a) Excludes all loans and leases held for sale and loans acquired with deteriorated credit quality.