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Accounts Receivable and Loans (Tables)
 6 Months Ended
Jun. 30, 2012
Accounts Receivable and Loans (Tables) [Abstract]  
Cardmember receivables segment detail

Accounts receivable as of June 30, 2012 and December 31, 2011 were as follows:

(Millions) 2012 2011
U.S. Card Services(a) $19,588 $20,645
International Card Services  6,804  7,222
Global Commercial Services(b)  14,985  12,829
Global Network & Merchant Services(c)  163  194
Cardmember receivables(d)  41,540  40,890
Less: Reserve for losses  392  438
Cardmember receivables, net $41,148 $40,452
Other receivables, net(e) $2,771 $3,657

(a)       Includes $6.7 billion and $7.5 billion of gross cardmember receivables available to settle obligations of a consolidated VIE as of June 30, 2012 and December 31, 2011, respectively.

(b)       Includes $492 million and $459 million of gross cardmember receivables available to settle obligations of a consolidated VIE as of June 30, 2012 and December 31, 2011, respectively. Also includes $746 million and $563 million due from airlines, of which Delta Air Lines (Delta) comprises $527 million and $340 million as of June 30, 2012 and December 31, 2011, respectively.

(c)       Includes receivables primarily related to the Company's International Currency Card portfolios.

(d)       Includes approximately $12.9 billion and $12.8 billion of cardmember receivables outside the United States as of June 30, 2012 and December 31, 2011, respectively.

(e)       Other receivables primarily represent amounts related to (i) purchased joint venture receivables, (ii) the Company's travel customers and suppliers, (iii) certain merchants for billed discount revenue and (iv) other receivables due to the Company in the ordinary course of business. As of December 31, 2011, other receivables also included investments that matured on December 31, 2011, but which did not settle until January 3, 2012. Other receivables are presented net of reserves for losses of $85 million and $102 million as of June 30, 2012 and December 31, 2011, respectively.
Cardmember loans segment detail

Loans as of June 30, 2012 and December 31, 2011 consisted of:

(Millions)  2012  2011
U.S. Card Services(a) $52,496 $53,686
International Card Services  8,448  8,901
Global Commercial Services  35  34
Cardmember loans  60,979  62,621
Less: Reserve for losses  1,547  1,874
Cardmember loans, net $59,432 $60,747
Other loans, net(b) $478 $419

(a)       Includes approximately $31.5 billion and $33.8 billion of gross cardmember loans available to settle obligations of a consolidated VIE as of June 30, 2012 and December 31, 2011, respectively.

(b)       Other loans primarily represent a store card loan portfolio whose billed business is not processed on the Company's network, loans to merchants and small business installment loans. Other loans are presented net of reserves for losses of $18 million as of both June 30, 2012 and December 31, 2011.
Aging of cardmember loans and receivables

The following table represents the aging of cardmember loans and receivables as of June 30, 2012 and December 31, 2011:

      30-59  60-89  90+   
      Days  Days  Days   
      Past  Past  Past   
2012(Millions)  Current  Due  Due  Due  Total
Cardmember Loans:               
U.S. Card Services $ 51,868 $ 184 $ 134 $ 310 $ 52,496
International Card Services   8,309   47   29   63   8,448
Cardmember Receivables:               
U.S. Card Services $ 19,255 $ 108 $ 65 $ 160 $ 19,588
International Card Services(a)  (b)  (b)  (b)   67   6,804
Global Commercial Services(a)  (b)  (b)  (b)   88   14,985
                
      30-59  60-89  90+   
      Days  Days  Days   
      Past  Past  Past   
2011(Millions)  Current  Due  Due  Due  Total
Cardmember Loans:               
U.S. Card Services $ 52,930 $218 $165 $373 $ 53,686
International Card Services   8,748  52  32  69   8,901
Cardmember Receivables:               
U.S. Card Services $ 20,246 $ 122 $ 81 $ 196 $ 20,645
International Card Services(a)  (b)  (b)  (b)   63   7,222
Global Commercial Services(a)  (b)  (b)  (b)   109   12,829

  • For cardmember receivables in International Card Services (ICS) and Global Commercial Services (GCS), delinquency data is tracked based on days past billing status rather than days past due. A cardmember account is considered 90 days past billing if payment has not been received within 90 days of the cardmember's billing statement date. In addition, if the Company initiates collection procedures on an account prior to the account becoming 90 days past billing the associated cardmember receivable balance is considered as 90 days past billing. These amounts are shown above as 90+ Days Past Due for presentation purposes.
  • Historically, data for periods prior to 90 days past billing are not available due to financial reporting system constraints. Therefore, it has not been relied upon 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:

  2012 2011 
  Net Write-Off Rate   Net Write-Off Rate   
      30 Days     30 Days 
    Principal, Past Due   Principal, Past Due 
  Principal Interest, & as a % of Principal Interest, &  as a % of 
  Only (a)Fees (a)Total Only (a)Fees (a)Total 
Cardmember Loans:             
U.S. Card Services 2.3%2.5%1.2%3.4%3.8%1.5%
International Card Services 2.1%2.6%1.7%3.1%3.7%2.1%
Cardmember Receivables:             
U.S. Card Services 2.2%2.3%1.7%1.6%1.7%1.7%
              
      2012 2011 
      Net Loss   Net Loss   
      Ratio as 90 Days Ratio as 90 Days 
      a % of Past Billing a % of Past Billing 
      Charge as a % of Charge as a % of 
      Volume Receivables Volume Receivables 
Cardmember Receivables:         
International Card Services 0.16%1.0%0.15%1.0%
Global Commercial Services0.07%0.6%0.06%0.7%

  • The Company presents a net write-off rate based on principal losses only (i.e., excluding interest and/or fees) to be consistent with industry convention. Because the Company's practice is to include uncollectible interest and/or fees as part of its total provision for losses, a net write-off rate including principal, interest and/or fees is also presented.
Impaired cardmember loans and receivables

The following table provides additional information with respect to the Company's impaired cardmember loans and receivables, which are not significant for ICS and GCS, as of June 30, 2012 and December 31, 2011:

   Loans over           
   90 Days     Loans &  Total  
   Past Due  Non-  Receivables  Impaired  Unpaid   
  & Accruing  Accrual  Modified  Loans &  Principal  Allowance
2012(Millions)  Interest (a) Loans (b) as a TDR (c) Receivables  Balance (d) for TDRs(e)
Cardmember Loans:                  
U.S. Card Services $ 56 $ 452 $ 692 $ 1,200 $ 1,146 $ 164
International Card Services   61   5   7   73   71   1
Cardmember Receivables:                  
U.S. Card Services   ―   ―   121   121   114   98
Total $ 117 $ 457 $ 820 $ 1,394 $ 1,331 $ 263
                   
   Loans over           
   90 Days     Loans &  Total  
   Past Due  Non-  Receivables  Impaired  Unpaid   
  & Accruing  Accrual  Modified  Loans &  Principal  Allowance
2011(Millions)  Interest (a) Loans (b) as a TDR (c) Receivables  Balance (d)for TDRs(e)
Cardmember Loans:                  
U.S. Card Services $ 64 $ 529 $ 736 $ 1,329 $ 1,268 $ 174
International Card Services   67   6   8   81   80   2
Cardmember Receivables:                  
U.S. Card Services   ―   ―   174   174   165   118
Total $ 131 $ 535 $ 918 $ 1,584 $ 1,513 $ 294

  • The Company's policy is generally to accrue interest through the date of write-off (at 180 days past due). The Company establishes reserves for interest that the Company believes will not be collected. Excludes loans modified as a TDR.
  • Non-accrual loans not in modification programs include certain cardmember loans placed with outside collection agencies for which the Company has ceased accruing interest. The Company's policy is generally not to resume the accrual of interest on these loans. Payments received are applied against the recorded loan balance. Interest income is recognized on a cash basis for any payments received after the loan balance has been paid in full. Excludes loans modified as a TDR.
  • Total loans and receivables modified as a TDR includes $351 million and $410 million that are non-accrual and $4 million and $4 million that are past due 90 days and still accruing interest as of June 30, 2012 and December 31, 2011, respectively.
  • Unpaid principal balance consists of cardmember charges billed and excludes other amounts charged directly by the Company such as interest and fees.
  • Represents the reserve for losses for TDRs, which are evaluated separately for impairment. The Company records a reserve for losses for all impaired loans. Refer to Cardmember Loans Evaluated Separately and Collectively for Impairment in Note 4 for further discussion of the reserve for losses on loans over 90 days past due and accruing interest and non-accrual loans, which are evaluated collectively for impairment.

 
Interest income recognized and average balances of impaired cardmember loans and receivables

The following table provides information with respect to the Company's interest income recognized and average balances of impaired cardmember loans and receivables, which are not significant for ICS and GCS, during the three and six months ended June 30:

  Three Months Ended June 30, 2012 Six Months Ended June 30, 2012  
   Interest     Interest     
   Income  Average  Income  Average  
(Millions)  Recognized  Balance  Recognized  Balance  
Cardmember Loans:              
U.S. Card Services $ 14 $ 1,242 $ 30 $ 1,271  
International Card Services   4   76   8   78  
Cardmember Receivables:              
U.S. Card Services   ―   133   ―   147  
Total $ 18 $ 1,451 $ 38 $ 1,496  
               
  Three Months Ended June 30, 2011 Six Months Ended June 30, 2011  
   Interest     Interest     
   Income  Average  Income  Average  
(Millions)  Recognized  Balance  Recognized  Balance  
Cardmember Loans:              
U.S. Card Services $17 $ 1,500 $ 35 $ 1,598  
International Card Services  8   101   17   106  
Cardmember Receivables:              
U.S. Card Services   ―   137   ―   130  
Total $ 25 $ 1,738 $ 52 $ 1,834  
Troubled debt restructurings

The following table provides additional information with respect to the cardmember loans and receivables modified as TDRs, which are not significant for ICS, during the three and six months ended June 30:

  Three Months Ended Six Months Ended
  June 30, 2012 June 30, 2012
     Aggregated  Aggregated    Aggregated  Aggregated
     Pre-  Post-    Pre-  Post-
    Modification Modification   Modification Modification
  Number of Outstanding Outstanding Number of Outstanding Outstanding
(Accounts in thousands, Dollars in millions) Accounts  Balances(a)  Balances(a) Accounts  Balances(a)  Balances(a)
Troubled Debt Restructurings:                
U.S. Card Services ― Cardmember Loans 24 $178 $173 56 $407 $396
U.S. Card Services ― Cardmember Receivables 8  94  93 19  222  218
Total(b) 32 $272 $266 75 $629 $614
                 
  Three Months Ended Six Months Ended
  June 30, 2011 June 30, 2011
     Aggregated  Aggregated    Aggregated  Aggregated
     Pre-  Post-    Pre-  Post-
    Modification Modification   Modification Modification
  Number of Outstanding Outstanding Number of Outstanding Outstanding
(Accounts in thousands, Dollars in millions) Accounts  Balances(a)  Balances(a) Accounts  Balances(a)  Balances
Troubled Debt Restructurings:                
U.S. Card Services ― Cardmember Loans 36 $267 $256 79 $587 $562
U.S. Card Services ― Cardmember Receivables 11  87  84 22  180  174
Total(b) 47 $354 $340 101 $767 $736

  • Includes principal and accrued interest.
  • The difference between the pre- and post-modification outstanding balances is attributable to amounts charged off for cardmember loans and receivables being resolved through the Company's short-term settlement programs.

 
Troubled debt restructurings that subsequently defaulted

The following table provides information for the three and six months ended June 30, 2012 and 2011, with respect to the cardmember loans and receivables modified as TDRs on which there was a default within the previous 12 months. A cardmember will default from a modification program after one and up to three consecutive missed payments, depending on the terms of the modification program. The defaulted ICS cardmember loan modifications were not significant.

  Three Months Ended Six Months Ended
  June 30, 2012 June 30, 2012
      Aggregated     Aggregated
     Outstanding     Outstanding
   Number of  Balances  Number of  Balances
(Accounts in thousands, Dollars in millions)  Accounts Upon Default(a)  Accounts Upon Default(a)
Troubled Debt Restructurings That Subsequently Defaulted:            
U.S. Card Services ― Cardmember Loans  6 $47  15 $110
U.S. Card Services ― Cardmember Receivables  1  8  2  20
Total  7 $55  17 $130
             
               
  Three Months Ended Six Months Ended
  June 30, 2011 June 30, 2011
      Aggregated     Aggregated
     Outstanding     Outstanding
   Number of  Balances  Number of  Balances
(Accounts in thousands, Dollars in millions)  Accounts Upon Default(a)  Accounts Upon Default(a)
Troubled Debt Restructurings That Subsequently Defaulted:            
U.S. Card Services ― Cardmember Loans  13 $96  27 $205
U.S. Card Services ― Cardmember Receivables  2  12  4  25
Total  15 $108  31 $230

  • The outstanding balance includes principal and accrued interest.