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LOANS AND LEASES (Tables)

3 Months Ended

Mar. 31, 2020

Summary of Loans and Leases, Net of Unearned Income

Following is a summary of loans and leases, net of unearned income:

TABLE 4.1



(in millions)	Amortized Cost Loans and Leases
March 31, 2020
Commercial real estate	$	9,126
Commercial and industrial	5,644
Commercial leases	444
Other	46
Total commercial loans and leases	15,260
Direct installment	1,880
Residential mortgages	3,444
Indirect installment	1,863
Consumer lines of credit	1,424
Total consumer loans	8,611
Total loans and leases, net of unearned income	$	23,871
(in millions)	Total Loans and Leases
December 31, 2019
Commercial real estate	$	8,960
Commercial and industrial	5,308
Commercial leases	432
Other	21
Total commercial loans and leases	14,721
Direct installment	1,821
Residential mortgages	3,374
Indirect installment	1,922
Consumer lines of credit	1,451
Total consumer loans	8,568
Total loans and leases, net of unearned income	$	23,289

Certain Information Relating to Commercial Real Estate Loans

The following table shows certain information relating to commercial real estate loans:

TABLE 4.2



(dollars in millions)	March 31, 2020		December 31, 2019
Commercial real estate:
Percent owner-occupied	30.0	%	30.6	%
Percent non-owner-occupied	70.0	%	69.4	%

Summary of Non-Performing Assets

Following is a summary of non-performing assets:

TABLE 4.3



(dollars in millions)	March 31, 2020			December 31, 2019
Non-accrual loans	$	134		$	81
Troubled debt restructurings	—			22
Total non-performing loans	134			103
Other real estate owned	20			26
Total non-performing assets	$	154		$	129
Asset quality ratios:
Non-performing loans / total loans and leases	0.56		%	0.44		%
Non-performing loans + OREO / total loans and leases + OREO	0.64		%	0.55		%
Non-performing assets / total assets	0.44		%	0.37		%

Age Analysis of Past Due Loans, by Class

The following tables provide an analysis of the aging of loans by class. The current year does not have comparable prior year data due to the current year's adoption of ASC 326.

TABLE 4.4



(in millions)	30-89 Days Past Due		> 90 Days Past Due and Still Accruing		Non- Accrual		Total Past Due		Current		Total Loans and Leases		Non-accrual with No ACL
Loans and Leases
March 31, 2020
Commercial real estate	$	29	$	—	$	67	$	96	$	9,030	$	9,126	$	13
Commercial and industrial	33		—		32		65		5,579		5,644		15
Commercial leases	2		—		2		4		440		444		—
Other	—		—		1		1		45		46		—
Total commercial loans and leases	64		—		102		166		15,094		15,260		28
Direct installment	8		1		10		19		1,861		1,880		—
Residential mortgages	32		2		13		47		3,397		3,444		—
Indirect installment	16		1		3		20		1,843		1,863		—
Consumer lines of credit	10		2		6		18		1,406		1,424		—
Total consumer loans	66		6		32		104		8,507		8,611		—
Total loans and leases	$	130	$	6	$	134	$	270	$	23,601	$	23,871	$	28



(in millions)	30-89 Days Past Due		> 90 Days Past Due and Still Accruing		Non- Accrual		Total Past Due		Current		Total Loans and Leases
Originated Loans and Leases
December 31, 2019
Commercial real estate	$	10	$	—	$	26	$	36	$	7,078	$	7,114
Commercial and industrial	9		—		28		37		5,026		5,063
Commercial leases	5		—		1		6		426		432
Other	—		—		1		1		20		21
Total commercial loans and leases	24		—		56		80		12,550		12,630
Direct installment	7		1		7		15		1,743		1,758
Residential mortgages	12		2		8		22		2,973		2,995
Indirect installment	15		1		3		19		1,903		1,922
Consumer lines of credit	5		1		3		9		1,083		1,092
Total consumer loans	39		5		21		65		7,702		7,767
Total originated loans and leases	$	63	$	5	$	77	$	145	$	20,252	$	20,397



(in millions)	30-89 Days Past Due		> 90 Days Past Due and Still Accruing		Non- Accrual		Total Past Due (1) (2)		Current		(Discount) Premium			Total Loans
Loans Acquired in a Business Combination
December 31, 2019
Commercial real estate	$	12	$	28	$	3	$	43	$	1,942	$	(139	)	$	1,846
Commercial and industrial	2		3		—		5		259		(19		)	245
Total commercial loans	14		31		3		48		2,201		(158		)	2,091
Direct installment	3		—		—		3		60		—			63
Residential mortgages	8		4		—		12		382		(15		)	379
Consumer lines of credit	7		2		1		10		357		(8		)	359
Total consumer loans	18		6		1		25		799		(23		)	801
Total loans acquired in a business combination	$	32	$	37	$	4	$	73	$	3,000	$	(181	)	$	2,892

(1)

Prior to the adoption of ASC 326 on January 1, 2020, loans acquired in a business combination are considered performing upon acquisition, regardless of whether the customer was contractually delinquent, if we can reasonably estimate the timing and amount of expected cash flows on such loans. In these instances, we do not consider acquired contractually delinquent loans to be non-accrual or non-performing and continue to recognize interest income on these loans using the accretion method. Loans acquired in a business combination are considered non-accrual or non-performing when, due to credit deterioration or other factors, we determine we are no longer able to reasonably estimate the timing and amount of expected cash flows on such loans. We do not recognize interest income on loans acquired in a business combination considered non-accrual or non-performing.

(2)

Past due information for loans acquired in a business combination is based on the contractual balance outstanding at December 31, 2019.

Summary of Loan, Credit Quality Indicators

We utilize the following categories to monitor credit quality within our commercial loan and lease portfolio:

TABLE 4.5



Rating Category	Definition
Pass	in general, the condition of the borrower and the performance of the loan is satisfactory or better

Special Mention	in general, the condition of the borrower has deteriorated, requiring an increased level of monitoring

Substandard	in general, the condition of the borrower has significantly deteriorated and the performance of the loan could further deteriorate if deficiencies are not corrected

Doubtful	in general, the condition of the borrower has significantly deteriorated and the collection in full of both principal and interest is highly questionable or improbable

Schedule of Financing Receivables, Originated Year

The following table summarizes designated loan rating category by loan class including term loans on an amortized cost basis by origination year:

TABLE 4.6



(in millions)
March 31, 2020	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Total
COMMERCIAL
Commercial Real Estate:
Risk Rating:
Pass	$	329	$	1,823	$	1,363	$	1,285	$	1,117	$	2,521	$	182	$	8,620
Special Mention	—		6		26		44		53		144		3		276
Substandard	—		3		13		23		45		140		6		230
Doubtful	—		—		—		—		—		—		—		—
Total commercial real estate	329		1,832		1,402		1,352		1,215		2,805		191		9,126
Commercial and Industrial:
Risk Rating:
Pass	437		1,392		843		497		186		456		1,435		5,246
Special Mention	2		29		33		30		15		28		78		215
Substandard	—		3		20		24		6		28		102		183
Doubtful	—		—		—		—		—		—		—		—
Total commercial and industrial	439		1,424		896		551		207		512		1,615		5,644
Commercial Leases:
Risk Rating:
Pass	41		173		117		75		13		6		—		425
Special Mention	10		1		1		—		—		—		—		12
Substandard	—		2		2		1		1		1		—		7
Doubtful	—		—		—		—		—		—		—		—
Total commercial leases	51		176		120		76		14		7		—		444
Other Commercial:
Risk Rating:
Pass	3		—		—		—		—		5		38		46
Special Mention	—		—		—		—		—		—		—		—
Substandard	—		—		—		—		—		—		—		—
Doubtful	—		—		—		—		—		—		—		—
Total other commercial	3		—		—		—		—		5		38		46
Total commercial	822		3,432		2,418		1,979		1,436		3,329		1,844		15,260



(in millions)
March 31, 2020	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Total

CONSUMER
Direct Installment:
Current	163		433		276		193		223		573		—		1,861
Past due	—		—		1		1		1		15		—		18
Total direct installment	163		433		277		194		224		588		—		1,879
Residential Mortgages:
Current	201		891		521		559		431		797		2		3,402
Past due	—		3		4		6		3		27		—		43
Total residential mortgages	201		894		525		565		434		824		2		3,445
Indirect Installment:
Current	123		615		653		273		122		57		—		1,843
Past due	—		5		6		4		3		2		—		20
Total indirect installment	123		620		659		277		125		59		—		1,863
Consumer Lines of Credit:
Current	1		9		14		5		5		132		1,240		1,406
Past due	—		—		—		—		1		14		3		18
Total consumer lines of credit	1		9		14		5		6		146		1,243		1,424
Total consumer	488		1,956		1,475		1,041		789		1,617		1,245		8,611
Total loans and leases	$	1,310	$	5,388	$	3,893	$	3,020	$	2,225	$	4,946	$	3,089	$	23,871

Summary of Credit Quality

The following tables present a summary of our commercial loans and leases by credit quality category segregated by loans and leases originated and loans acquired:

TABLE 4.7



	Commercial Loan and Lease Credit Quality Categories
(in millions)	Pass		Special Mention		Substandard		Doubtful		Total
Originated Loans and Leases
December 31, 2019
Commercial real estate	$	6,821	$	171	$	121	$	1	$	7,114
Commercial and industrial	4,768		149		144		2		5,063
Commercial leases	423		3		6		—		432
Other	20		—		1		—		21
Total originated commercial loans and leases	$	12,032	$	323	$	272	$	3	$	12,630
Loans Acquired in a Business Combination
December 31, 2019
Commercial real estate	$	1,603	$	116	$	127	$	—	$	1,846
Commercial and industrial	201		19		25		—		245
Total commercial loans acquired in a business combination	$	1,804	$	135	$	152	$	—	$	2,091

Summary of Consumer Loans by Payment Status

Following is a table showing consumer loans by payment status:

TABLE 4.8



	Consumer Loan Credit Quality by Payment Status
(in millions)	Performing		Non- Performing		Total
Originated Loans
December 31, 2019
Direct installment	$	1,745	$	13	$	1,758
Residential mortgages	2,978		17		2,995
Indirect installment	1,919		3		1,922
Consumer lines of credit	1,086		6		1,092
Total originated consumer loans	$	7,728	$	39	$	7,767
Loans Acquired in a Business Combination
December 31, 2019
Direct installment	$	63	$	—	$	63
Residential mortgages	379		—		379
Consumer lines of credit	358		1		359
Total consumer loans acquired in a business combination	$	800	$	1	$	801

Summary of Impaired Loans and Leases, by Class

Following is a summary of information pertaining to loans and leases considered to be impaired, by class of loan and lease:

TABLE 4.9



(in millions)	Unpaid Contractual Principal Balance		Recorded Investment With No Specific Reserve		Recorded Investment With Specific Reserve		Total Recorded Investment		Specific Reserve		Average Recorded Investment
At or for the Year Ended December 31, 2019
Commercial real estate	$	30	$	25	$	2	$	27	$	2	$	26
Commercial and industrial	35		21		—		21		2		22
Commercial leases	1		1		—		1		—		1
Total commercial loans and leases	66		47		2		49		4		49
Direct installment	16		13		—		13		—		13
Residential mortgages	20		18		—		18		—		17
Indirect installment	5		3		—		3		—		3
Consumer lines of credit	7		5		—		5		—		5
Total consumer loans	48		39		—		39		—		38
Total	$	114	$	86	$	2	$	88	$	4	$	87

Additional Allowance For Credit Losses Related To Loans Acquired In A Business Combination

Following is a summary of the ACL required for loans acquired in a business combination due to changes in credit quality subsequent to the acquisition date:

TABLE 4.10



(in millions)	December 31, 2019
Commercial real estate	$	4
Commercial and industrial	—
Total commercial loans	4
Direct installment	1
Residential mortgages	2
Total consumer loans	3
Total allowance for credit losses on loans acquired in a business combination	$	7

Summary of the composition of total TDRs

Following is a summary of the composition of total TDRs:

TABLE 4.11



(in millions)	Total
March 31, 2020
Accruing	$	64
Non-accrual	30
Total TDRs	$	94
December 31, 2019
Accruing	$	41
Non-accrual	15
Total TDRs	$	56

Summary of Troubled Debt Restructurings by Class of Loans

Following is a summary of TDR loans, by class:

TABLE 4.12



	Three Months Ended March 31, 2020
(dollars in millions)	Number of Contracts	Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial real estate	5	$	1	$	1
Commercial and industrial	7	1		—
Total commercial loans	12	2		1
Direct installment	19	2		2
Residential mortgages	14	1		1
Consumer lines of credit	15	—		—
Total consumer loans	48	3		3
Total	60	$	5	$	4



	Three Months Ended March 31, 2019
(dollars in millions)	Number of Contracts	Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment
Commercial real estate	1	$	—	$	—
Commercial and industrial	12	1		1
Total commercial loans	13	1		1
Direct installment	18	1		1
Residential mortgages	3	—		—
Consumer lines of credit	8	—		—
Total consumer loans	29	1		1
Total	42	$	2	$	2

Summary of Troubled Debt Restructurings by Class of Loans and Leases, Payment Default

Following is a summary of TDRs, by class, for which there was a payment default, excluding loans that have been paid off and/or sold. Default occurs when a loan is 90 days or more past due and is within 12 months of restructuring.

TABLE 4.13



	Three Months Ended March 31, 2020
(dollars in millions)	Number of Contracts	Recorded Investment
Commercial real estate	10	$	4
Commercial and industrial	2	—
Total commercial loans	12	4
Direct installment	4	$	—
Residential mortgages	1	—
Consumer lines of credit	—	—
Total consumer loans	5	—
Total	17	$	4

Summary of Originated Troubled Debt Restructurings by Class of Loans and Leases, Payment Default

Following is a summary of originated TDRs, by class, for which there was a payment default, excluding loans that have been paid off and/or sold.

TABLE 4.14



	Three Months Ended March 31, 2019
(dollars in millions)	Number of Contracts	Recorded Investment
Commercial real estate	1	$	—
Total commercial loans	1	—
Direct installment	2	—
Residential mortgages	1	—
Consumer lines of credit	2	—
Total consumer loans	5	—
Total	6	$	—

Summary of Outstanding Principal Balance and Carrying Amount of Acquired Loans Acquired In A Business Combination

The outstanding balance and the carrying amount of loans acquired in a business combination included in the Consolidated Balance Sheets are as follows:

TABLE 4.15



(in millions)	December 31, 2019
Accounted for under ASC 310-30:
Outstanding balance	$	2,684
Carrying amount	2,461
Accounted for under ASC 310-20:
Outstanding balance	436
Carrying amount	425
Total loans acquired in a business combination:
Outstanding balance	3,120
Carrying amount	2,886

Schedule Of Changes In Accretable Yields Of Loans Acquired In A Business Combination

The following table provides changes in accretable yield for all loans acquired in business combinations that are accounted for under ASC 310-30. Loans accounted for under ASC 310-20 are not included in this table.

TABLE 4.16



	Three Months Ended March 31,
(in millions)	2019
Balance at beginning of period	$	605
Reduction due to unexpected early payoffs	(20		)
Reclass from non-accretable difference to accretable yield	30
Disposals/transfers	—
Other	—
Accretion	(50		)
Balance at end of period	$	565