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Loans and leases and the allowance for credit losses (Tables)

3 Months Ended

Mar. 31, 2024

Summary of Current, Past Due and Nonaccrual Loans

A summary of current, past due and nonaccrual loans as of March 31, 2024 and December 31, 2023 follows:


(Dollars in millions)	Current		30-89 Days Past Due		Accruing Loans Past Due 90 Days or More		Nonaccrual		Total
March 31, 2024
Commercial and industrial	$	56,803	$	219	$	11	$	864	$	57,897
Real estate:
Commercial (a)		24,119		163		31		855		25,168
Residential builder and developer		984		48		—		3		1,035
Other commercial construction		5,915		155		2		141		6,213
Residential (b)		21,118		627		245		202		22,192
Residential — limited documentation		801		30		—		53		884
Consumer:
Home equity lines and loans		4,437		34		—		87		4,558
Recreational finance		10,553		71		—		30		10,654
Automobile		4,252		43		—		13		4,308
Other		1,982		20		8		54		2,064
Total	$	130,964	$	1,410	$	297	$	2,302	$	134,973

December 31, 2023
Commercial and industrial	$	56,091	$	238	$	11	$	670	$	57,010
Real estate:
Commercial (a)		24,072		311		25		869		25,277
Residential builder and developer		1,065		5		—		3		1,073
Other commercial construction		6,322		159		1		171		6,653
Residential (b)		21,080		763		295		215		22,353
Residential — limited documentation		825		31		—		55		911
Consumer:
Home equity lines and loans		4,528		40		—		81		4,649
Recreational finance		9,935		87		—		36		10,058
Automobile		3,918		60		—		14		3,992
Other		2,003		30		7		52		2,092
Total	$	129,839	$	1,724	$	339	$	2,166	$	134,068

(a)

Commercial real estate loans held for sale were $563 million at March 31, 2024 and $189 million at December 31, 2023.

(b)

One-to-four family residential mortgage loans held for sale were $165 million at March 31, 2024 and $190 million at December 31, 2023.

Summary of Loan grades applied various classes of Commercial and Industrial Loans and Commercial Real Estate Loans

The following table summarizes the loan grades applied at March 31, 2024 to the various classes of the Company’s commercial and industrial loans and commercial real estate loans and gross charge-offs for those types of loans for the three-month period ended March 31, 2024 by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
(Dollars in millions)	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
Commercial and industrial:
Pass	$	2,012	$	8,129	$	7,567	$	4,441	$	2,099	$	6,456	$	22,719	$	74	$	53,497
Criticized accrual		32		306		422		277		117		602		1,745		35		3,536
Criticized nonaccrual		2		54		89		62		71		206		364		16		864
Total commercial and industrial	$	2,046	$	8,489	$	8,078	$	4,780	$	2,287	$	7,264	$	24,828	$	125	$	57,897
Gross charge-offs	$	—	$	7	$	9	$	4	$	3	$	5	$	50	$	—	$	78
Real estate:
Commercial:
Pass	$	696	$	1,783	$	1,652	$	1,331	$	2,013	$	11,278	$	435	$	—	$	19,188
Criticized accrual		—		273		815		464		558		3,008		7		—		5,125
Criticized nonaccrual		—		—		46		11		101		695		2		—		855
Total commercial real estate	$	696	$	2,056	$	2,513	$	1,806	$	2,672	$	14,981	$	444	$	—	$	25,168
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	13	$	—	$	—	$	13
Residential builder and developer:
Pass	$	89	$	509	$	187	$	34	$	5	$	14	$	102	$	—	$	940
Criticized accrual		—		2		21		21		—		46		2		—		92
Criticized nonaccrual		—		—		—		2		—		1		—		—		3
Total residential builder and developer	$	89	$	511	$	208	$	57	$	5	$	61	$	104	$	—	$	1,035
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	1	$	—	$	—	$	1
Other commercial construction:
Pass	$	27	$	990	$	1,231	$	590	$	273	$	589	$	45	$	—	$	3,745
Criticized accrual		—		75		538		460		567		687		—		—		2,327
Criticized nonaccrual		—		—		11		10		45		75		—		—		141
Total other commercial construction	$	27	$	1,065	$	1,780	$	1,060	$	885	$	1,351	$	45	$	—	$	6,213
Gross charge-offs	$	—	$	—	$	2	$	—	$	—	$	7	$	2	$	—	$	11

The following table summarizes the loan grades applied at December 31, 2023 to the various classes of the Company’s commercial and industrial loans and commercial real estate loans by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
(Dollars in millions)	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
Commercial and industrial:
Pass	$	8,689	$	8,087	$	4,800	$	2,248	$	2,169	$	4,843	$	22,345	$	70	$	53,251
Criticized accrual		292		279		277		142		127		481		1,460		31		3,089
Criticized nonaccrual		29		68		56		75		36		150		243		13		670
Total commercial and industrial	$	9,010	$	8,434	$	5,133	$	2,465	$	2,332	$	5,474	$	24,048	$	114	$	57,010
Real estate:
Commercial:
Pass	$	2,048	$	1,742	$	1,367	$	2,011	$	3,059	$	8,491	$	440	$	—	$	19,158
Criticized accrual		227		891		465		456		966		2,238		7		—		5,250
Criticized nonaccrual		—		46		3		113		93		611		3		—		869
Total commercial real estate	$	2,275	$	2,679	$	1,835	$	2,580	$	4,118	$	11,340	$	450	$	—	$	25,277
Residential builder and developer:
Pass	$	530	$	252	$	41	$	6	$	2	$	12	$	116	$	—	$	959
Criticized accrual		1		18		30		—		59		—		3		—		111
Criticized nonaccrual		—		—		3		—		—		—		—		—		3
Total residential builder and developer	$	531	$	270	$	74	$	6	$	61	$	12	$	119	$	—	$	1,073
Other commercial construction:
Pass	$	813	$	1,366	$	651	$	373	$	646	$	187	$	30	$	—	$	4,066
Criticized accrual		53		391		390		691		565		326		—		—		2,416
Criticized nonaccrual		—		14		10		46		50		49		2		—		171
Total other commercial construction	$	866	$	1,771	$	1,051	$	1,110	$	1,261	$	562	$	32	$	—	$	6,653

Summary of loans in Accrual and Nonaccrual Status

A summary of loans in accrual and nonaccrual status at March 31, 2024 for the various classes of the Company’s residential real estate loans and consumer loans and gross charge-offs for those types of loans for the three-month period ended March 31, 2024 by origination year follows:


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
(Dollars in millions)	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
Residential:
Current	$	478	$	1,499	$	4,667	$	3,717	$	2,533	$	8,131	$	93	$	—	$	21,118
30-89 days past due		—		6		107		62		30		422		—		—		627
Accruing loans past due 90 days or more		—		2		21		19		15		188		—		—		245
Nonaccrual		—		1		15		10		2		173		1		—		202
Total residential	$	478	$	1,508	$	4,810	$	3,808	$	2,580	$	8,914	$	94	$	—	$	22,192
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	1	$	—	$	—	$	1
Residential - limited documentation:
Current	$	—	$	—	$	—	$	—	$	—	$	801	$	—	$	—	$	801
30-89 days past due		—		—		—		—		—		30		—		—		30
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		53		—		—		53
Total residential - limited documentation	$	—	$	—	$	—	$	—	$	—	$	884	$	—	$	—	$	884
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Home equity lines and loans:
Current	$	—	$	—	$	—	$	2	$	2	$	105	$	2,972	$	1,356	$	4,437
30-89 days past due		—		—		—		—		—		3		—		31		34
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		5		1		81		87
Total home equity lines and loans	$	—	$	—	$	—	$	2	$	2	$	113	$	2,973	$	1,468	$	4,558
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1	$	1
Recreational finance:
Current	$	1,028	$	2,531	$	2,252	$	1,790	$	1,233	$	1,719	$	—	$	—	$	10,553
30-89 days past due		1		11		12		14		13		20		—		—		71
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		4		6		6		4		10		—		—		30
Total recreational finance	$	1,029	$	2,546	$	2,270	$	1,810	$	1,250	$	1,749	$	—	$	—	$	10,654
Gross charge-offs	$	—	$	3	$	5	$	6	$	4	$	7	$	—	$	—	$	25
Automobile:
Current	$	684	$	1,026	$	1,004	$	942	$	371	$	225	$	—	$	—	$	4,252
30-89 days past due		1		7		11		11		6		7		—		—		43
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		2		2		3		2		4		—		—		13
Total automobile	$	685	$	1,035	$	1,017	$	956	$	379	$	236	$	—	$	—	$	4,308
Gross charge-offs	$	—	$	2	$	2	$	2	$	1	$	1	$	—	$	—	$	8
Other:
Current	$	69	$	219	$	155	$	105	$	28	$	27	$	1,378	$	1	$	1,982
30-89 days past due		1		1		3		1		—		1		12		1		20
Accruing loans past due 90 days or more		—		—		—		—		—		—		8		—		8
Nonaccrual		1		1		1		—		—		—		51		—		54
Total other	$	71	$	221	$	159	$	106	$	28	$	28	$	1,449	$	2	$	2,064
Gross charge-offs	$	1	$	3	$	3	$	1	$	1	$	—	$	16	$	—	$	25
Total loans and leases at March 31, 2024	$	5,121	$	17,431	$	20,835	$	14,385	$	10,088	$	35,581	$	29,937	$	1,595	$	134,973
Total gross charge-offs for the three months ended March 31, 2024	$	1	$	15	$	21	$	13	$	9	$	35	$	68	$	1	$	163

A summary of loans in accrual and nonaccrual status at December 31, 2023 for the various classes of the Company’s residential real estate loans and consumer loans by origination year follows:


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
(Dollars in millions)	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
Residential:
Current	$	1,726	$	4,709	$	3,732	$	2,543	$	1,215	$	7,060	$	95	$	—	$	21,080
30-89 days past due		18		120		88		52		28		457		—		—		763
Accruing loans past due 90 days or more		1		30		28		17		14		205		—		—		295
Nonaccrual		1		17		10		3		4		179		1		—		215
Total residential	$	1,746	$	4,876	$	3,858	$	2,615	$	1,261	$	7,901	$	96	$	—	$	22,353
Residential - limited documentation:
Current	$	—	$	—	$	—	$	—	$	—	$	825	$	—	$	—	$	825
30-89 days past due		—		—		—		—		—		31		—		—		31
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		55		—		—		55
Total residential - limited documentation	$	—	$	—	$	—	$	—	$	—	$	911	$	—	$	—	$	911
Consumer:
Home equity lines and loans:
Current	$	—	$	—	$	2	$	2	$	13	$	98	$	3,022	$	1,391	$	4,528
30-89 days past due		—		—		—		—		—		3		—		37		40
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		5		3		73		81
Total home equity lines and loans	$	—	$	—	$	2	$	2	$	13	$	106	$	3,025	$	1,501	$	4,649
Recreational finance:
Current	$	2,653	$	2,338	$	1,857	$	1,286	$	781	$	1,020	$	—	$	—	$	9,935
30-89 days past due		11		16		19		14		11		16		—		—		87
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		3		5		8		6		5		9		—		—		36
Total recreational finance	$	2,667	$	2,359	$	1,884	$	1,306	$	797	$	1,045	$	—	$	—	$	10,058
Automobile:
Current	$	1,063	$	1,096	$	1,047	$	427	$	198	$	87	$	—	$	—	$	3,918
30-89 days past due		8		15		17		9		6		5		—		—		60
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		2		3		3		2		2		2		—		—		14
Total automobile	$	1,073	$	1,114	$	1,067	$	438	$	206	$	94	$	—	$	—	$	3,992
Other:
Current	$	250	$	176	$	118	$	33	$	13	$	18	$	1,392	$	3	$	2,003
30-89 days past due		3		3		2		—		—		1		20		1		30
Accruing loans past due 90 days or more		—		—		—		—		—		—		7		—		7
Nonaccrual		2		1		1		—		—		—		48		—		52
Total other	$	255	$	180	$	121	$	33	$	13	$	19	$	1,467	$	4	$	2,092
Total loans and leases at December 31, 2023	$	18,423	$	21,683	$	15,025	$	10,555	$	10,062	$	27,464	$	29,237	$	1,619	$	134,068

Changes in Allowance for Credit Losses

Changes in the allowance for credit losses for the three months ended March 31, 2024 and 2023 were as follows:


	Commercial and			Real Estate
(Dollars in millions)	industrial			Commercial			Residential			Consumer			Total
Three Months Ended March 31, 2024
Beginning balance	$	620		$	764		$	116		$	629		$	2,129
Provision for credit losses		137			9			2			52			200
Net charge-offs:
Charge-offs		(78	)		(25	)		(1	)		(59	)		(163	)
Recoveries		5			6			1			13			25
Net charge-offs		(73	)		(19	)		—			(46	)		(138	)
Ending balance	$	684		$	754		$	118		$	635		$	2,191


Three Months Ended March 31, 2023
Beginning balance	$	568		$	611		$	115		$	631		$	1,925
Provision for credit losses		21			86			(1	)		14			120
Net charge-offs:
Charge-offs		(20	)		(29	)		(2	)		(44	)		(95	)
Recoveries		10			1			1			13			25
Net charge-offs		(10	)		(28	)		(1	)		(31	)		(70	)
Ending balance	$	579		$	669		$	113		$	614		$	1,975

Loan and Leases Considered Nonaccrual and Interest Income Recognized on Loans

Information with respect to loans and leases that were considered nonaccrual at the beginning and end of the reporting period and the interest income recognized on such loans for the three-month periods ended March 31, 2024 and 2023 follows:


	Amortized Cost with Allowance		Amortized Cost without Allowance		Total		Amortized Cost			Interest Income Recognized
(Dollars in millions)	March 31, 2024							January 1, 2024		Three Months Ended March 31, 2024
Commercial and industrial	$	590	$	274	$	864		$	670	$	2
Real estate:
Commercial		379		476		855			869		6
Residential builder and developer		3		—		3			3		—
Other commercial construction		33		108		141			171		—
Residential		82		120		202			215		3
Residential — limited documentation		18		35		53			55		1
Consumer:
Home equity lines and loans		48		39		87			81		1
Recreational finance		18		12		30			36		—
Automobile		7		6		13			14		—
Other		54		—		54			52		—
Total	$	1,232	$	1,070	$	2,302		$	2,166	$	13

(Dollars in millions)	March 31, 2023							January 1, 2023		Three Months Ended March 31, 2023
Commercial and industrial	$	227	$	342	$	569		$	504	$	3
Real estate:
Commercial		364		966		1,330			1,240		5
Residential builder and developer		3		—		3			1		—
Other commercial construction		94		49		143			125		2
Residential		125		129		254			272		5
Residential — limited documentation		40		29		69			78		—
Consumer:
Home equity lines and loans		39		42		81			85		2
Recreational finance		24		10		34			45		—
Automobile		23		4		27			40		—
Other		47		—		47			49		—
Total	$	986	$	1,571	$	2,557		$	2,439	$	17

Loan Modification Activities to Borrowers Experiencing Financial Difficulty on Financing Receivables

The table that follows summarizes the Company’s loan modification activities to borrowers experiencing financial difficulty for the three-month periods ended March 31, 2024 and 2023:


	Amortized cost at March 31, 2024
(Dollars in millions)	Payment Deferral		Interest Rate Reduction		Other		Combination of Modification Types (a)		Total (b) (c)		Percent of Total Loan Class
Three Months Ended March 31, 2024
Commercial and industrial	$	184	$	—	$	—	$	—	$	184		.32	%
Real estate:
Commercial		267		—		—		3		270	1.07
Residential builder and developer		2		—		—		—		2		.18
Other commercial construction		131		—		—		—		131	2.11
Residential		48		—		—		1		49		.22
Residential — limited documentation		2		—		—		—		2		.17
Consumer:
Home equity lines and loans		—		—		—		—		—		—
Recreational finance		—		—		—		—		—		—
Automobile		—		—		—		—		—		—
Other		—		—		—		—		—		—
Total	$	634	$	—	$	—	$	4	$	638		.47	%


	Amortized cost at March 31, 2023
(Dollars in millions)	Payment Deferral		Interest Rate Reduction		Other		Combination of Modification Types (a)		Total (b) (c)		Percent of Total Loan Class
Three Months Ended March 31, 2023
Commercial and industrial	$	70	$	—	$	—	$	—	$	70		.13	%
Real estate:
Commercial		94		—		—		—		94		.35
Residential builder and developer		8		—		—		—		8		.64
Other commercial construction		92		—		—		—		92	1.39
Residential		33		—		—		2		35		.15
Residential — limited documentation		5		—		—		—		5		.51
Consumer:
Home equity lines and loans		—		—		—		—		—		—
Recreational finance		—		—		—		—		—		—
Automobile		—		—		—		—		—		—
Other		—		—		—		—		—		—
Total	$	302	$	—	$	—	$	2	$	304		.23	%

(a)

Predominantly payment deferrals combined with interest rate reductions.

(b)

Includes approximately $44 million and $23 million of loans guaranteed by government-related entities (predominantly first lien residential mortgage loans) for the three-month periods ended March 31, 2024 and 2023, respectively.

(c)

Excludes unfunded commitments to extend credit totaling $29 million and $11 million for the three-month periods ended March 31, 2024 and 2023, respectively.

Summary of Payment Status of Loans Modified

The following table summarizes the payment status, at March 31, 2024, of loans that were modified during the twelve-month period ended March 31, 2024.


	Payment status at March 31, 2024 (amortized cost)
(Dollars in millions)	Current		30-89 Days Past Due		Past Due 90 Days or More (a)		Total
Twelve Months Ended March 31, 2024
Commercial and industrial	$	310	$	7	$	10	$	327
Real estate:
Commercial		715		33		24		772
Residential builder and developer		14		39		—		53
Other commercial construction		534		5		—		539
Residential (b)		112		35		30		177
Residential — limited documentation		6		2		—		8
Consumer:
Home equity lines and loans		2		—		—		2
Recreational finance		—		—		—		—
Automobile		—		—		—		—
Other		—		—		—		—
Total	$	1,693	$	121	$	64	$	1,878

(a) Predominantly loan modifications with payment deferrals.

(b) Includes loans guaranteed by government-related entities classified as 30 to 89 days past due of $30 million and as past due 90 days or more of $27 million.