Loans and Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2024

The composition of the loan portfolio, by class and underlying specific portfolio type, was as follows:


	March 31, 2024				December 31, 2023
(Dollars in Millions)	Amount		Percent of Total		Amount		Percent of Total
Commercial
Commercial	$	130,530	34.8	%	$	127,676	34.2	%
Lease financing	4,196		1.2		4,205		1.1
Total commercial	134,726		36.0		131,881		35.3
Commercial Real Estate
Commercial mortgages	41,157		11.0		41,934		11.2
Construction and development	11,520		3.1		11,521		3.1
Total commercial real estate	52,677		14.1		53,455		14.3
Residential Mortgages
Residential mortgages	109,396		29.2		108,605		29.0
Home equity loans, first liens	6,683		1.8		6,925		1.9
Total residential mortgages	116,079		31.0		115,530		30.9
Credit Card	27,844		7.4		28,560		7.6
Other Retail
Retail leasing	4,137		1.1		4,135		1.1
Home equity and second mortgages	12,932		3.5		13,056		3.5
Revolving credit	3,473		.9		3,668		1.0
Installment	13,921		3.7		13,889		3.7
Automobile	8,799		2.3		9,661		2.6
Total other retail	43,262		11.5		44,409		11.9
Total loans	$	374,588	100.0	%	$	373,835	100.0	%

Activity in Allowance for Credit Losses by Portfolio Class

Activity in the allowance for credit losses by portfolio class was as follows:


Three Months Ended March 31 (Dollars in Millions)	Commercial		Commercial Real Estate		Residential Mortgages		Credit Card		Other Retail		Total Loans
2024
Balance at beginning of period	$	2,119	$	1,620	$	827	$	2,403	$	870	$	7,839
Add


Provision for credit losses	156		30		16		318		33		553
Deduct
Loans charged-off	139		34		4		337		81		595
Less recoveries of loans charged-off	(23)		(13)		(4)		(41)		(26)		(107)
Net loan charge-offs (recoveries)	116		21		—		296		55		488
Balance at end of period	$	2,159	$	1,629	$	843	$	2,425	$	848	$	7,904
2023
Balance at beginning of period	$	2,163	$	1,325	$	926	$	2,020	$	970	$	7,404
Add
Change in accounting principle(a)	—		—		(31)		(27)		(4)		(62)
Allowance for acquired credit losses(b)	—		127		—		—		—		127
Provision for credit losses	64		24		51		294		(6)		427
Deduct
Loans charged-off	63		123		4		215		64		469
Less recoveries of loans charged-off	(16)		(6)		(5)		(40)		(29)		(96)
Net loan charge-offs (recoveries)	47		117		(1)		175		35		373
Balance at end of period	$	2,180	$	1,359	$	947	$	2,112	$	925	$	7,523

(a)Effective January 1, 2023, the Company adopted accounting guidance which removed the separate recognition and measurement of troubled debt restructurings.

(b)Represents allowance for acquired credit deteriorated and charged-off loans.

Credit Quality Indicators

The following table provides a summary of loans charged-off by portfolio class and year of origination:


Three Months Ended March 31 (Dollars in Millions)	Commercial		Commercial Real Estate(a)		Residential Mortgages		Credit Card(b)		Other Retail		Total Loans
2024
Originated in 2024	$	—	$	5	$	—	$	—	$	2	$	7
Originated in 2023	26		4		—		—		10		40
Originated in 2022	18		24		—		—		14		56
Originated in 2021	8		—		—		—		11		19
Originated in 2020	4		—		—		—		8		12
Originated prior to 2020	10		1		4		—		11		26
Revolving	73		—		—		337		25		435

Total charge-offs	$	139	$	34	$	4	$	337	$	81	$	595

2023
Originated in 2023	$	—	$	—	$	—	$	—	$	—	$	—
Originated in 2022	6		88		—		—		10		104
Originated in 2021	4		—		—		—		11		15
Originated in 2020	4		—		—		—		6		10
Originated in 2019	5		3		1		—		7		16
Originated prior to 2019	11		32		3		—		8		54
Revolving	33		—		—		215		22		270

Total charge-offs	$	63	$	123	$	4	$	215	$	64	$	469

Note: Year of origination is based on the origination date of a loan, or for existing loans the date when the maturity date, pricing or commitment amount is amended.

(a)Includes $91 million of charge-offs in the first quarter of 2023 related to uncollectible amounts on acquired loans.

(b)Predominantly all credit card loans are considered revolving loans. Includes an immaterial amount of charge-offs related to revolving converted to term loans.

The following table provides a summary of loans by portfolio class and the Company’s internal credit quality rating:


	March 31, 2024										December 31, 2023
			Criticized										Criticized
(Dollars in Millions)	Pass		Special Mention		Classified(a)		Total Criticized		Total		Pass		Special Mention		Classified(a)		Total Criticized		Total
Commercial
Originated in 2024	$	12,040	$	118	$	323	$	441	$	12,481	$	—	$	—	$	—	$	—	$	—
Originated in 2023	38,505		513		1,008		1,521		40,026		43,023		827		856		1,683		44,706
Originated in 2022	35,074		298		791		1,089		36,163		40,076		274		632		906		40,982
Originated in 2021	8,307		180		117		297		8,604		9,219		117		154		271		9,490
Originated in 2020	2,866		70		117		187		3,053		3,169		92		71		163		3,332
Originated prior to 2020	4,902		8		149		157		5,059		5,303		30		209		239		5,542
Revolving(b)	27,819		298		1,223		1,521		29,340		26,213		362		1,254		1,616		27,829
Total commercial	129,513		1,485		3,728		5,213		134,726		127,003		1,702		3,176		4,878		131,881
Commercial real estate
Originated in 2024	1,472		59		637		696		2,168		—		—		—		—		—
Originated in 2023	8,149		460		1,845		2,305		10,454		8,848		465		2,206		2,671		11,519
Originated in 2022	11,087		856		1,251		2,107		13,194		11,831		382		1,141		1,523		13,354
Originated in 2021	8,546		544		431		975		9,521		9,235		500		385		885		10,120
Originated in 2020	3,465		36		140		176		3,641		3,797		51		87		138		3,935
Originated prior to 2020	10,168		91		899		990		11,158		10,759		458		619		1,077		11,836
Revolving	2,468		4		69		73		2,541		2,613		6		70		76		2,689
Revolving converted to term	—		—		—		—		—		2		—		—		—		2
Total commercial real estate	45,355		2,050		5,272		7,322		52,677		47,085		1,862		4,508		6,370		53,455
Residential mortgages(c)
Originated in 2024	2,127		—		—		—		2,127		—		—		—		—		—
Originated in 2023	9,414		—		4		4		9,418		9,734		—		5		5		9,739
Originated in 2022	29,117		—		18		18		29,135		29,146		—		17		17		29,163
Originated in 2021	36,061		—		16		16		36,077		36,365		—		16		16		36,381
Originated in 2020	14,542		—		14		14		14,556		14,773		—		9		9		14,782
Originated prior to 2020	24,510		—		256		256		24,766		25,202		—		262		262		25,464
Revolving	—		—		—		—		—		1		—		—		—		1
Total residential mortgages	115,771		—		308		308		116,079		115,221		—		309		309		115,530
Credit card(d)	27,448		—		396		396		27,844		28,185		—		375		375		28,560
Other retail
Originated in 2024	1,837		—		—		—		1,837		—		—		—		—		—
Originated in 2023	4,875		—		6		6		4,881		5,184		—		4		4		5,188
Originated in 2022	5,228		—		11		11		5,239		5,607		—		12		12		5,619
Originated in 2021	9,401		—		14		14		9,415		10,398		—		15		15		10,413
Originated in 2020	3,946		—		7		7		3,953		4,541		—		9		9		4,550
Originated prior to 2020	3,656		—		19		19		3,675		4,008		—		20		20		4,028
Revolving	13,386		—		106		106		13,492		13,720		—		104		104		13,824
Revolving converted to term	722		—		48		48		770		735		—		52		52		787
Total other retail	43,051		—		211		211		43,262		44,193		—		216		216		44,409
Total loans	$	361,138	$	3,535	$	9,915	$	13,450	$	374,588	$	361,687	$	3,564	$	8,584	$	12,148	$	373,835
Total outstanding commitments	$	763,786	$	5,147	$	11,915	$	17,062	$	780,848	$	762,869	$	5,053	$	10,470	$	15,523	$	778,392

Note: Year of origination is based on the origination date of a loan, or for existing loans the date when the maturity date, pricing or commitment amount is amended. Predominately all current year and near term loan origination years for criticized loans relate to existing loans that have had recent maturity date, pricing or commitment amount amendments.

(a)Classified rating on consumer loans primarily based on delinquency status.

(b)Includes an immaterial amount of revolving converted to term loans.

(c)At March 31, 2024, $1.8 billion of GNMA loans 90 days or more past due and $1.4 billion of modified GNMA loans whose repayments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs were classified with a pass rating, compared with $2.0 billion and $1.2 billion at December 31, 2023, respectively.

(d)Predominately all credit card loans are considered revolving loans. Includes an immaterial amount of revolving converted to term loans.

Loans by Portfolio Class, Including Delinquency Status

The following table provides a summary of loans by portfolio class, including the delinquency status of those that continue to accrue interest, and those that are nonperforming:


	Accruing
(Dollars in Millions)	Current		30-89 Days Past Due		90 Days or More Past Due		Nonperforming(b)		Total
March 31, 2024
Commercial	$	133,763	$	309	$	105	$	549	$	134,726
Commercial real estate	51,753		22		2		900		52,677
Residential mortgages(a)	115,636		143		145		155		116,079
Credit card	27,058		390		396		—		27,844
Other retail	42,823		236		66		137		43,262
Total loans	$	371,033	$	1,100	$	714	$	1,741	$	374,588
December 31, 2023
Commercial	$	130,925	$	464	$	116	$	376	$	131,881
Commercial real estate	52,619		55		4		777		53,455
Residential mortgages(a)	115,067		169		136		158		115,530
Credit card	27,779		406		375		—		28,560
Other retail	43,926		278		67		138		44,409
Total loans	$	370,316	$	1,372	$	698	$	1,449	$	373,835

(a)At March 31, 2024, $491 million of loans 30–89 days past due and $1.8 billion of loans 90 days or more past due purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose repayments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, were classified as current, compared with $595 million and $2.0 billion at December 31, 2023, respectively.

(b)Substantially all nonperforming loans at March 31, 2024 and December 31, 2023, had an associated allowance for credit losses. The Company recognized interest income on nonperforming loans of $5 million and $4 million for the three months ended March 31, 2024 and 2023, respectively.

Loans Modified

The following table provides a summary of period-end balances of loans modified during the periods presented, by portfolio class and modification granted:


Three Months Ended March 31 (Dollars in Millions)	Interest Rate Reduction		Payment Delay		Term Extension		Multiple Modifications(a)		Total Modifications		Percent of Class Total
2024
Commercial	$	25	$	—	$	328	$	—	$	353	.3	%
Commercial real estate	—		—		282		50		332		.6
Residential mortgages(b)	—		20		5		2		27		—
Credit card	126		—		—		—		126		.5
Other retail	3		1		38		—		42		.1
Total loans, excluding loans purchased from GNMA mortgage pools	154		21		653		52		880		.2
Loans purchased from GNMA mortgage pools(b)	1		490		68		93		652		.6
Total loans	$	155	$	511	$	721	$	145	$	1,532	.4	%
2023
Commercial	$	114	$	—	$	68	$	—	$	182	.1	%
Commercial real estate	—		—		12		28		40		.1
Residential mortgages(b)	—		130		10		12		152		.1
Credit card	94		—		—		—		94		.4
Other retail	2		11		63		2		78		.1
Total loans, excluding loans purchased from GNMA mortgage pools	210		141		153		42		546		.1
Loans purchased from GNMA mortgage pools(b)	—		243		63		47		353		.3
Total loans	$	210	$	384	$	216	$	89	$	899	.2	%

(a)Includes $88 million of total loans receiving a payment delay and term extension, $53 million of total loans receiving an interest rate reduction and term extension and $4 million of total loans receiving an interest rate reduction, payment delay and term extension for the three months ended March 31, 2024. Includes $52 million of total loans receiving a payment delay and term extension, $32 million of total loans receiving an interest rate reduction and term extension and $5 million of total loans receiving an interest rate reduction, payment delay and term extension for the three months ended March 31, 2023.

(b)Percent of class total amounts expressed as a percent of total residential mortgage loan balances.

The following table summarizes the effects of loan modifications made to borrowers on loans modified:


Three Months Ended March 31	Weighted-Average Interest Rate Reduction		Weighted-Average Months of Term Extension
2024
Commercial(a)	19.3	%	7
Commercial real estate	4.3		9
Residential mortgages	2.5		84
Credit card	16.4		—
Other retail	9.3		4
Loans purchased from GNMA mortgage pools	.4		114
2023
Commercial	2.4	%	5
Commercial real estate	5.0		6
Residential mortgages	1.2		120
Credit card	16.0		—
Other retail	6.6		151
Loans purchased from GNMA mortgage pools	.7		66

Note: The weighted-average payment deferral for all portfolio classes was less than $1 million for both the three months ended March 31, 2024 and 2023. Forbearance payments are required to be paid at the end of the original term loan.

(a)The weighted-average interest rate reduction for commercial loans for the three months ended March 31, 2024, was primarily driven by commercial cards.

Loans Modified by Delinquency Status

The following table provides a summary of loan balances at March 31, 2024, which were modified during the prior twelve months, by portfolio class and delinquency status:


(Dollars in Millions)	Current		30-89 Days Past Due		90 Days or More Past Due		Total
Commercial	$	498	$	16	$	83	$	597
Commercial real estate	712		2		281		995
Residential mortgages(a)	1,509		17		15		1,541
Credit card	275		67		34		376
Other retail	130		18		7		155
Total loans	$	3,124	$	120	$	420	$	3,664

(a)At March 31, 2024, $333 million of loans 30-89 days past due and $198 million of loans 90 days or more past due purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose payments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, were classified as current.

The following table provides a summary of loan balances at March 31, 2023, which were modified on or after January 1, 2023, the date the Company adopted accounting guidance which removed the separate recognition and measurement of troubled debt restructurings, through March 31, 2023, by portfolio class and delinquency status:


(Dollars in Millions)	Current		30-89 Days Past Due		90 Days or More Past Due		Total
Commercial	$	146	$	6	$	30	$	182
Commercial real estate	6		—		34		40
Residential mortgages(a)	319		3		10		332
Credit card	56		28		10		94
Other retail	64		3		2		69
Total loans	$	591	$	40	$	86	$	717

(a)At March 31, 2023, $32 million of loans 30-89 days past due and $1 million of loans 90 days or more past due purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose payments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, were classified as current.

Loans Modified During the year that Defaulted

The following table provides a summary of loans that defaulted (fully or partially charged-off or became 90 days or more past due) that were modified within twelve months prior to default.


(Dollars in Millions)	Interest Rate Reduction		Payment Delay		Term Extension		Multiple Modifications(a)
Three Months Ended March 31, 2024
Commercial	$	6	$	—	$	—	$	—
Residential mortgages	—		5		3		2
Credit card	29		—		—		—
Other retail	—		1		6		—
Total loans, excluding loans purchased from GNMA mortgage pools	35		6		9		2
Loans purchased from GNMA mortgage pools	—		77		31		42
Total loans	$	35	$	83	$	40	$	44

(a)Includes $43 million of total loans receiving a payment delay and term extension and $1 million of total loans receiving an interest rate reduction, payment delay and term extension.