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Accounts Receivable and Loans (Tables)
 9 Months Ended
Sep. 30, 2013
Accounts Receivable and Loans (Tables) [Abstract]  
Card Member receivables segment detail

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

(Millions) 2013 2012
U.S. Card Services(a) $20,258 $21,124
International Card Services  7,181  7,778
Global Commercial Services(b)  15,853  13,671
Global Network & Merchant Services(c)  172  193
Card Member receivables(d)  43,464  42,766
Less: Reserve for losses  396  428
Card Member receivables, net $43,068 $42,338
Other receivables, net(e) $3,429 $3,576

  • Includes $6.4 billion and $7.5 billion of gross Card Member receivables available to settle obligations of consolidated VIEs as of September 30, 2013 and December 31, 2012, respectively.
  • Includes $476 million of gross Card Member receivables available to settle obligations of a consolidated VIE as of December 31, 2012. Also includes $857 million and $913 million due from airlines, of which Delta Air Lines (Delta) comprises $600 million and $676 million as of September 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 Card Member receivables outside the United States for both September 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 $77 million and $86 million as of September 30, 2013 and December 31, 2012, respectively.
Card Member loans segment detail

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

(Millions)  2013  2012
U.S. Card Services(a) $54,481 $55,953
International Card Services  8,445  9,236
Global Commercial Services  44  40
Card Member loans  62,970  65,229
Less: Reserve for losses  1,281  1,471
Card Member loans, net $61,689 $63,758
Other loans, net(b) $526 $551

  • Includes approximately $29.5 billion and $32.7 billion of gross Card Member loans available to settle obligations of consolidated VIEs as of September 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 September 30, 2013 and December 31, 2012, respectively.

 
Aging of Card Member loans and receivables

The following table represents the aging of Card Member loans and receivables as of September 30, 2013 and December 31, 2012:

       30-59  60-89  90+   
       Days  Days  Days   
       Past  Past  Past   
2013 (Millions)  Current  Due  Due  Due  Total
Card Member Loans:                
U.S. Card Services  $53,892 $184 $127 $278 $54,481
International Card Services   8,318  41  28  58  8,445
Card Member Receivables:                
U.S. Card Services  $19,915 $122 $65 $156 $20,258
International Card Services(a)   (b)  (b)  (b)  80  7,181
Global Commercial Services(a)   (b)  (b)  (b)  120  15,853
                
      30-59  60-89  90+   
      Days  Days  Days   
      Past  Past  Past   
2012 (Millions)  Current  Due  Due  Due  Total
Card Member Loans:                
U.S. Card Services  $55,281 $200 $147 $325 $55,953
International Card Services   9,099  47  30  60  9,236
Card Member 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 Card Member 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 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 the Company initiates collection procedures on an account prior to the account becoming 90 days past billing the associated Card Member 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 nine months ended September 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 
Card Member Loans:             
U.S. Card Services 1.9%2.1%1.1%2.2%2.4%1.3%
International Card Services 1.9%2.3%1.5%1.9%2.5%1.6%
Card Member Receivables:             
U.S. Card Services 1.8%1.9%1.7%2.0%2.1%1.8%
              
      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 
Card Member Receivables:         
International Card Services 0.20%1.1%0.16%0.9%
Global Commercial Services0.07%0.8%0.07%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. 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 Card Member loans and receivables

The following table provides additional information with respect to the Company's impaired Card Member loans, which are not significant for GCS, and Card Member receivables, which are not significant for ICS and GCS, as of September 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)
Card Member Loans:                   
U.S. Card Services  $ 125 $ 284 $ 397 $ 806 $ 764 $ 86
International Card Services    57   4   4   65   64   ―
Card Member Receivables:                   
U.S. Card Services    ―   ―   55   55   51   39
Total  $ 182 $ 288 $ 456 $ 926 $ 879 $ 125
                    
    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)
Card Member Loans:                   
U.S. Card Services  $ 73 $ 426 $ 627 $ 1,126 $ 1,073 $ 152
International Card Services    59   5   6   70   69   1
Card Member 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 Card Member loans placed with outside collection agencies for which the Company has ceased accruing interest. Effective September 1, 2013 the Company began accruing interest on accounts placed with outside agencies.
  • Total loans and receivables modified as a TDR includes $93 million and $320 million that are non-accrual and $20 million and $6 million that are past due 90 days and still accruing interest as of September 30, 2013 and December 31, 2012, respectively.
  • Unpaid principal balance consists of Card Member 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 Card Member 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 Card Member loans and receivables

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

  Three Months Ended September 30, 2013 Nine Months Ended September 30, 2013  
   Interest     Interest     
   Income  Average  Income  Average  
(Millions)  Recognized  Balance  Recognized  Balance  
Card Member Loans:              
U.S. Card Services $ 11 $ 859 $ 34 $ 982  
International Card Services   4   66   12   68  
Card Member Receivables:              
U.S. Card Services   ―   62   ―   89  
Total $ 15 $ 987 $ 46 $ 1,139  
               
  Three Months Ended September 30, 2012 Nine Months Ended September 30, 2012  
   Interest     Interest     
   Income  Average  Income  Average  
(Millions)  Recognized  Balance  Recognized  Balance  
Card Member Loans:              
U.S. Card Services $11 $ 1,182 $ 35 $ 1,244  
International Card Services  4   73   12   77  
Card Member Receivables:              
U.S. Card Services   ―   120   ―   140  
Total $ 15 $ 1,375 $ 47 $ 1,461  
Troubled debt restructurings

The following table provides additional information with respect to the Card Member loans and receivables modified as TDRs, which are not significant for ICS and GCS, during the three and nine months ended September 30:

  Three Months Ended Nine Months Ended
  September 30, 2013 September 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 ― Card Member Loans 12 $91 $91 47 $357 $355
U.S. Card Services ― Card Member Receivables 4  49  49 16  204  202
Total(b) 16 $140 $140 63 $561 $557
                 
  Three Months Ended Nine Months Ended
  September 30, 2012 September 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 ― Card Member Loans 26 $193 $190 82 $600 $587
U.S. Card Services ― Card Member Receivables 9  104  103 28  326  320
Total(b) 35 $297 $293 110 $926 $907

  • Includes principal and accrued interest.
  • The difference between the pre- and post-modification outstanding balances is attributable to amounts charged off for Card Member 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 nine months ended September 30, 2013 and 2012, with respect to the Card Member loans and receivables modified as TDRs that subsequently defaulted within 12 months of modification. A Card Member 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 Card Member loan and receivable modifications were not significant.

  Three Months Ended Nine Months Ended
  September 30, 2013 September 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 ― Card Member Loans  4 $37  15 $138
U.S. Card Services ― Card Member Receivables   1  8  3  33
Total  5 $45  18 $171
             
               
  Three Months Ended Nine Months Ended
  September 30, 2012 September 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 ― Card Member Loans  4 $39  19 $149
U.S. Card Services ― Card Member Receivables  1  8  1  28
Total  5 $47  20 $177

  • The outstanding balance includes principal, fees and accrued interest on Card Member Loans and principal and fees on Card Member Receivables.