Loans and Accounts Receivable (Tables)

6 Months Ended

Jun. 30, 2019

Loans Notes Trade And Other Receivables Disclosure [Abstract]

Card Member receivables segment and other loans detail

Card Member loans by segment and Other loans as of June 30, 2019 and December 31, 2018 consisted of:

(Millions)	2019		2018
Global Consumer Services Group (a)	$	69,743	$	69,458
Global Commercial Services	13,487		12,396
Card Member loans	83,230		81,854
Less: Reserve for losses	2,168		2,134
Card Member loans, net	$	81,062	$	79,720
Other loans, net (b)	$	4,059	$	3,676

(a) Includes approximately $31.7 billion and $33.2 billion of gross Card Member loans available to settle obligations of a consolidated variable interest entity (VIE) as of June 30, 2019 and December 31, 2018, respectively.

(b) Other loans primarily represent consumer and commercial non-card financing products. Other loans are presented net of reserves for losses of $133 million and $124 million as of June 30, 2019 and December 31, 2018, respectively.

Card Member accounts receivable by segment and Other receivables as of June 30, 2019 and December 31, 2018 consisted of:

(Millions)	2019		2018
Global Consumer Services Group (a)	$	21,192	$	21,455
Global Commercial Services	37,516		34,438
Card Member receivables	58,708		55,893
Less: Reserve for losses	616		573
Card Member receivables, net	$	58,092	$	55,320
Other receivables, net (b)	$	3,173	$	2,907

(a) Includes $7.8 billion and $8.5 billion of gross Card Member receivables available to settle obligations of a consolidated VIE as of June 30, 2019 and December 31, 2018, respectively.

(b)

Other receivables primarily represent amounts related to (i) Global Network Services partners for items such as royalty and franchise fees, (ii) tax-related receivables, (iii) certain merchants for billed discount revenue, and (iv) loyalty coalition partners for points issued, as well as program participation and servicing fees. Other receivables are presented net of reserves for losses of $27 million and $25 million as of June 30, 2019 and December 31, 2018, respectively.

Aging of Card Member loans and receivables

The following table presents the aging of Card Member loans and receivables as of June 30, 2019 and December 31, 2018:

2019 (Millions)	Current		30-59 Days Past Due		60-89 Days Past Due		90+ Days Past Due		Total
Card Member Loans:
Global Consumer Services Group	$	68,745	$	286	$	213	$	499	$	69,743
Global Commercial Services
Global Small Business Services	13,275		55		36		77		13,443
Global Corporate Payments (a)	(b)		(b)		(b)		—		44
Card Member Receivables:
Global Consumer Services Group	20,923		90		51		128		21,192
Global Commercial Services
Global Small Business Services	$	17,521	$	108	$	56	$	121	$	17,806
Global Corporate Payments (a)	(b)		(b)		(b)		144		19,710

2018 (Millions)	Current		30-59 Days Past Due		60-89 Days Past Due		90+ Days Past Due		Total
Card Member Loans:
Global Consumer Services Group	$	68,442	$	290	$	220	$	506	$	69,458
Global Commercial Services
Global Small Business Services	12,195		51		32		73		12,351
Global Corporate Payments (a)	(b)		(b)		(b)		—		45
Card Member Receivables:
Global Consumer Services Group	21,207		80		50		118		21,455
Global Commercial Services
Global Small Business Services	$	16,460	$	101	$	53	$	114	$	16,728
Global Corporate Payments (a)	(b)		(b)		(b)		$	129	$	17,710

(a) For Global Corporate Payments Card Member loans and receivables in Global Commercial Services (GCS), delinquency data is tracked based on days past billing status rather than days past due. A Card Member account is considered 90 days past billing if payment has not been received within 90 days of the Card Member’s billing statement date. In addition, if we initiate collection procedures on an account prior to the account becoming 90 days past billing, the associated Card Member loan or receivable balance is classified as 90 days past billing. These amounts are shown above as 90+ Days Past Due for presentation purposes. See also (b).

(b)

Delinquency data for periods other than 90+ days past billing is not available due to system constraints. Therefore, such data has not been utilized for risk management purposes. The balances that are current to 89 days past due can be derived as the difference between the Total and the 90+ Days Past Due balances.

Credit quality indicators for loans and receivables

The following tables present the key credit quality indicators as of or for the six months ended June 30:

	2019						2018
	Net Write-Off Rate						Net Write-Off Rate
	Principal Only (a)		Principal, Interest & Fees (a)		30+ Days Past Due as a % of Total		Principal Only (a)		Principal, Interest & Fees (a)		30+ Days Past Due as a % of Total
Card Member Loans:
Global Consumer Services Group	2.4	%	2.8	%	1.4	%	2.1	%	2.5	%	1.3	%
Global Small Business Services	1.8	%	2.1	%	1.3	%	1.7	%	2.0	%	1.2	%
Card Member Receivables:
Global Consumer Services Group	1.7	%	1.8	%	1.3	%	1.6	%	1.8	%	1.2	%
Global Small Business Services	1.8	%	2.1	%	1.6	%	1.9	%	2.1	%	1.4	%

	2019				2018
	Net Loss Ratio as a % of Charge Volume		90+ Days Past Billing as a % of Receivables		Net Loss Ratio as a % of Charge Volume		90+ Days Past Billing as a % of Receivables
Card Member Receivables:
Global Corporate Payments	0.07	%	0.7	%	0.11	%	0.8	%

(a)

We present a net write-off rate based on principal losses only (i.e., excluding interest and/or fees) to be consistent with industry convention. In addition, because we consider uncollectible interest and/or fees in estimating our reserves for credit losses, a net write-off rate including principal, interest and/or fees is also presented.

Impaired Card Member loans and receivables

The following tables provide additional information with respect to our impaired Card Member loans and receivables as of June 30, 2019 and December 31, 2018:

	As of June 30, 2019
					Accounts Classified as a TDR (c)
2019 (Millions)	Over 90 days Past Due & Accruing Interest (a)		Non- Accruals (b)		In Program (d)		Out of Program (e)		Total Impaired Balance		Unpaid Principal Balance		Allowance for TDRs
Card Member Loans:
Global Consumer Services Group (f)	$	328	$	248	$	395	$	145	$	1,116	$	998	$	103
Global Commercial Services	43		48		77		33		201		188		17
Card Member Receivables:
Global Consumer Services Group	—		—		41		14		55		54		3
Global Commercial Services	—		—		84		28		112		112		5
Total	$	371	$	296	$	597	$	220	$	1,484	$	1,352	$	128

	As of December 31, 2018
					Accounts Classified as a TDR (c)
2018 (Millions)	Over 90 days Past Due & Accruing Interest (a)		Non- Accruals (b)		In Program (d)		Out of Program (e)		Total Impaired Balance		Unpaid Principal Balance		Allowance for TDRs
Card Member Loans:
Global Consumer Services Group (f)	$	344	$	236	$	313	$	131	$	1,024	$	923	$	80
Global Commercial Services	43		43		59		29		174		161		14
Card Member Receivables:
Global Consumer Services Group	—		—		29		13		42		42		2
Global Commercial Services	—		—		61		25		86		86		5
Total	$	387	$	279	$	462	$	198	$	1,326	$	1,212	$	101

(a) Our policy is generally to accrue interest through the date of write-off (typically 180 days past due). We establish reserves for interest that we believe will not be collected. Amounts presented exclude Card Member loans classified as a TDR.

(b) Non-accrual loans not in modification programs primarily include certain Card Member loans placed with outside collection agencies for which we have ceased accruing interest. Amounts presented exclude Card Member loans classified as a TDR.

(c) Accounts classified as a TDR include $21 million and $17 million that are over 90 days past due and accruing interest and $7 million and $6 million that are non-accruals as of June 30, 2019 and December 31, 2018, respectively.

(d) In Program TDRs include Card Member accounts that are currently enrolled in a modification program.

(e) Out of Program TDRs include $165 million and $148 million of Card Member accounts that have successfully completed a modification program and $55 million and $50 million of Card Member accounts that were not in compliance with the terms of the modification programs as of June 30, 2019 and December 31, 2018, respectively.

(f)

Global Consumer Services Group (GCSG) includes balances outside the U.S. of $79 million and $69 million that are over 90 days and accruing interest and $67 million and $68 million in unpaid principal as of June 30, 2019 and December 31, 2018, respectively.

Interest income recognized and average balance of impaired Card Member loans and receivables

The following table provides information with respect to our average balances and interest income recognized from impaired Card Member loans and the average balances of impaired Card Member receivables for the three and six months ended June 30, 2019 and 2018:

(Millions)	Three Months Ended June 30, 2019				Six Months Ended June 30, 2019
	Average Balance		Interest Income Recognized		Average Balance		Interest Income Recognized
Card Member Loans:
Global Consumer Services Group	$	1,102	$	33	$	1,076	$	64
Global Commercial Services	195		6		188		12
Card Member Receivables:
Global Consumer Services Group	51		—		48		—
Global Commercial Services	105		—		99		—
Total	$	1,453	$	39	$	1,411	$	76

(Millions)	Three Months Ended June 30, 2018				Six Months Ended June 30, 2018
	Average Balance		Interest Income Recognized		Average Balance		Interest Income Recognized
Card Member Loans:
Global Consumer Services Group	$	846	$	26	$	819	$	52
Global Commercial Services	149		6		141		11
Card Member Receivables:
Global Consumer Services Group	31		—		29		—
Global Commercial Services	72		—		67		—
Total	$	1,098	$	32	$	1,056	$	63

Troubled debt restructurings

The following table provides additional information with respect to Card Member loans and receivables modified as TDRs for the three and six months ended June 30, 2019 and 2018.

	Three Months Ended June 30, 2019					Six Months Ended June 30, 2019
	Number of Accounts (thousands)	Outstanding Balances (millions)(a)		Average Interest Rate Reduction (% Points)	Average Payment Term Extension (# of Months)	Number of Accounts (thousands)	Outstanding Balances (millions)(a)		Average Interest Rate Reduction (% Points)	Average Payment Term Extension (# of Months)
Troubled Debt Restructurings:
Card Member Loans	17	$	137	13	(b)	34	$	265	13	(b)
Card Member Receivables	2	50		(c)	26	4	90		(c)	27
Total	19	$	187			38	$	355

	Three Months Ended June 30, 2018					Six Months Ended June 30, 2018
	Number of Accounts (thousands)	Outstanding Balances (millions)(a)		Average Interest Rate Reduction (% Points)	Average Payment Term Extension (# of Months)	Number of Accounts (thousands)	Outstanding Balances (millions)(a)		Average Interest Rate Reduction (% Points)	Average Payment Term Extension (# of Months)
Troubled Debt Restructurings:
Card Member Loans	12	$	88	12	(b)	23	$	169	12	(b)
Card Member Receivables	1	25		(c)	28	2	54		(c)	28
Total	13	$	113			25	$	223

(a) Represents the outstanding balance immediately prior to modification. The outstanding balance includes principal, fees and accrued interest on Card Member loans and principal and fees on Card Member receivables. Modifications did not reduce the principal balance.

(b) For Card Member loans, there have been no payment term extensions.

(c)

We do not offer interest rate reduction programs for Card Member receivables as the receivables are non-interest bearing.

Troubled debt restructurings that subsequently defaulted

The following table provides information with respect to Card Member loans and receivables modified as TDRs that subsequently defaulted within 12 months of modification. A Card Member is considered in default of a modification program after one and up to two missed payments, depending on the terms of the modification program. For all Card Members that defaulted from a modification program, the probability of default is factored into the reserves for Card Member loans and receivables.

	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
	Number of Accounts (thousands)	Aggregated Outstanding Balances Upon Default (millions)(a)		Number of Accounts (thousands)	Aggregated Outstanding Balances Upon Default (millions)(a)
Troubled Debt Restructurings That Subsequently Defaulted:
Card Member Loans	3	$	18	5	$	36
Card Member Receivables	1	5		2	8
Total	4	$	23	7	$	44

	Three Months Ended June 30, 2018			Six Months Ended June 30, 2018
	Number of Accounts (thousands)	Aggregated Outstanding Balances Upon Default (millions)(a)		Number of Accounts (thousands)	Aggregated Outstanding Balances Upon Default (millions)(a)
Troubled Debt Restructurings That Subsequently Defaulted:
Card Member Loans	2	$	9	4	$	18
Card Member Receivables	1	3		2	5
Total	3	$	12	6	$	23

(a)

The outstanding balances upon default include principal, fees and accrued interest on Card Member loans, and principal and fees on Card Member receivables.