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Accounts Receivable and Loans (Tables)
 6 Months Ended
Jun. 30, 2013
Accounts Receivable and Loans (Tables) [Abstract]  
Cardmember receivables segment detail

Accounts receivable as of June 30, 2013 and December 31, 2012 consisted of:

(Millions) 2013 2012
U.S. Card Services(a) $20,861 $21,124
International Card Services  7,153  7,778
Global Commercial Services(b)  15,893  13,671
Global Network & Merchant Services(c)  190  193
Cardmember receivables(d)  44,097  42,766
Less: Reserve for losses  386  428
Cardmember receivables, net $43,711 $42,338
Other receivables, net(e) $3,204 $3,576

  • Includes $6.7 billion and $7.5 billion of gross cardmember receivables available to settle obligations of a consolidated VIE as of June 30, 2013 and December 31, 2012, respectively.
  • Includes $468 million and $476 million of gross cardmember receivables available to settle obligations of a consolidated VIE as of June 30, 2013 and December 31, 2012, respectively. Also includes $851 million and $913 million due from airlines, of which Delta Air Lines (Delta) comprises $658 million and $676 million as of June 30, 2013 and December 31, 2012, respectively.
  • Includes receivables primarily related to the Company's International Currency Card portfolios.
  • Includes approximately $13.7 billion of cardmember receivables outside the United States as of both June 30, 2013 and December 31, 2012.
  • Other receivables primarily represent amounts related to (i) purchased joint venture receivables, (ii) certain merchants for billed discount revenue, and (iii) Global Network Services (GNS) partner banks for items such as royalty and franchise fees. Other receivables are presented net of reserves for losses of $84 million and $86 million as of June 30, 2013 and December 31, 2012, respectively.
Cardmember loans segment detail

Loans as of June 30, 2013 and December 31, 2012 consisted of:

(Millions)  2013  2012
U.S. Card Services(a) $54,645 $55,953
International Card Services  8,384  9,236
Global Commercial Services  45  40
Cardmember loans  63,074  65,229
Less: Reserve for losses  1,342  1,471
Cardmember loans, net $61,732 $63,758
Other loans, net(b) $532 $551

  • Includes approximately $30.1 billion and $32.7 billion of gross cardmember loans available to settle obligations of a consolidated VIE as of June 30, 2013 and December 31, 2012, respectively.
  • Other loans primarily represent loans to merchants and a store card loan portfolio whose billed business is not processed on the Company's network. Other loans are presented net of reserves for losses of $16 million and $20 million as of June 30, 2013 and December 31, 2012, respectively.

 
Aging of cardmember loans and receivables

The following table represents the aging of cardmember loans and receivables as of June 30, 2013 and December 31, 2012:

      30-59  60-89  90+   
      Days  Days  Days   
      Past  Past  Past   
2013 (Millions)  Current  Due  Due  Due  Total
Cardmember Loans:               
U.S. Card Services $54,063 $170 $120 $292 $54,645
International Card Services  8,251  45  28  60  8,384
Cardmember Receivables:               
U.S. Card Services $20,520 $117 $68 $156 $20,861
International Card Services(a)  (b)  (b)  (b)  79  7,153
Global Commercial Services(a)  (b)  (b)  (b)  116  15,893
                
      30-59  60-89  90+   
      Days  Days  Days   
      Past  Past  Past   
2012 (Millions)  Current  Due  Due  Due  Total
Cardmember Loans:               
U.S. Card Services $55,281 $200 $147 $325 $55,953
International Card Services  9,099  47  30  60  9,236
Cardmember Receivables:               
U.S. Card Services $20,748 $116 $76 $184 $21,124
International Card Services(a)  (b)  (b)  (b)  74  7,778
Global Commercial Services(a)  (b)  (b)  (b)  112  13,671

  • 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.
  • 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:

  2013 2012 
  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 2.0%2.2%1.1%2.3%2.5%1.2%
International Card Services 1.9%2.3%1.6%2.1%2.6%1.7%
Cardmember Receivables:             
U.S. Card Services 2.0%2.1%1.6%2.2%2.3%1.7%
              
      2013 2012 
      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 0.19%1.1%0.16%1.0%
Global Commercial Services0.08%0.7%0.07%0.6%

  • 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. In addition, 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, which are not significant for GCS, and cardmember receivables, which are not significant for ICS and GCS, as of June 30, 2013 and December 31, 2012:

   Loans over           
   90 Days     Loans &  Total  
   Past Due  Non-  Receivables  Impaired  Unpaid   
  & Accruing  Accrual  Modified  Loans &  Principal  Allowance
2013 (Millions)  Interest (a) Loans (b) as a TDR (c) Receivables  Balance (d) for TDRs(e)
Cardmember Loans:                  
U.S. Card Services $ 90 $ 353 $ 469 $ 912 $ 869 $ 118
International Card Services   59   4   5   68   67   1
Cardmember Receivables:                  
U.S. Card Services   ―    ―    69   69   64   68
Total $ 149 $ 357 $ 543 $ 1,049 $ 1,000 $ 187
                   
   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 $ 73 $ 426 $ 627 $ 1,126 $ 1,073 $ 152
International Card Services   59   5   6   70   69   1
Cardmember Receivables:                  
U.S. Card Services   ―    ―    117   117   111   91
Total $ 132 $ 431 $ 750 $ 1,313 $ 1,253 $ 244

  • 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 $181 million and $320 million that are non-accrual and $8 million and $6 million that are past due 90 days and still accruing interest as of June 30, 2013 and December 31, 2012, 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 individually for impairment. The Company records a reserve for losses for all impaired loans. Refer to Cardmember Loans Evaluated Individually 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 balance 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, which are not significant for GCS, and cardmember receivables, which are not significant for ICS and GCS, during the three and six months ended June 30:

  Three Months Ended June 30, 2013 Six Months Ended June 30, 2013  
   Interest     Interest     
   Income  Average  Income  Average  
(Millions)  Recognized  Balance  Recognized  Balance  
Cardmember Loans:              
U.S. Card Services $ 14 $ 999 $ 29 $ 1,041  
International Card Services   4   69   8   69  
Cardmember Receivables:              
U.S. Card Services   ―    91   ―    100  
Total $ 18 $ 1,159 $ 37 $ 1,210  
               
  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  
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, 2013 June 30, 2013
      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 12 $94 $94 35 $267 $264
U.S. Card Services ― Cardmember Receivables 4  51  51 12  154  153
Total(b) 16 $145 $145 47 $421 $417
                 
  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
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

  • 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. As of June 30, 2013, U.S. settlements are now written off immediately as a result of a change in the short-term settlement programs and thus there is no longer a difference between the pre- and post-modification outstanding balances.

 
Troubled debt restructurings that subsequently defaulted

The following table provides information for the three and six months ended June 30, 2013 and 2012, with respect to the cardmember loans and receivables modified as TDRs that subsequently defaulted within 12 months of modification. A cardmember will default from a modification program after one and up to two consecutive missed payments, depending on the terms of the modification program. The defaulted ICS cardmember loan and receivable modifications were not significant.

  Three Months Ended Six Months Ended
  June 30, 2013 June 30, 2013
      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 $53  11 $101
U.S. Card Services ― Cardmember Receivables   1  13  2  25
Total  7 $66  13 $126
             
               
  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

  • The outstanding balance includes principal and accrued interest.