Loans and Related Allowance for Credit Losses (Tables)

6 Months Ended

Jun. 30, 2023

Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]

Loans Outstanding

Table 5.1 presents total loans outstanding by portfolio segment and class of financing receivable. Outstanding balances include unearned income, net deferred loan fees or costs, and unamortized discounts and premiums. These amounts were less

than 1% of our total loans outstanding at both June 30, 2023, and December 31, 2022.

Outstanding balances exclude accrued interest receivable on loans, except for certain revolving loans, such as credit card loans.

See Note 7 (Intangible Assets and Other Assets) for additional information on accrued interest receivable. Amounts considered to be uncollectible are reversed through interest income. During the first half of 2023, we reversed accrued interest receivable of $19 million for our commercial portfolio segment and $118 million for our consumer portfolio segment, compared with $20 million and $65 million, respectively, for the same period a year ago.

Table 5.1: Loans Outstanding

(in millions)	Jun 30, 2023		Dec 31, 2022
Commercial and industrial	$	386,011	386,806
Commercial real estate	154,276		155,802
Lease financing	15,334		14,908
Total commercial	555,621		557,516
Residential mortgage	265,085		269,117
Credit card	47,717		46,293
Auto	51,587		53,669
Other consumer	27,950		29,276
Total consumer	392,339		398,355
Total loans	$	947,960	955,871

Our non-U.S. loans are reported by respective class of financing receivable in the table above. Substantially all of our non-U.S. loan portfolio is commercial loans. Table 5.2 presents

total non-U.S. commercial loans outstanding by class of financing receivable.

Table 5.2: Non-U.S. Commercial Loans Outstanding

(in millions)	Jun 30, 2023		Dec 31, 2022
Commercial and industrial	$	75,081	78,981
Commercial real estate	7,539		7,619
Lease financing	710		670
Total non-U.S. commercial loans	$	83,330	87,270

Loan Purchases, Sales, and Transfers

Table 5.3 presents the proceeds paid or received for purchases and sales of loans and transfers from loans held for investment to mortgages/loans held for sale. The table excludes loans for which we have elected the fair value option and government insured/guaranteed residential mortgage – first lien loans because their loan activity normally does not impact the ACL.

Table 5.3: Loan Purchases, Sales, and Transfers

	2023				2022
(in millions)	Commercial		Consumer	Total	Commercial	Consumer	Total
Quarter ended June 30,
Purchases	$	195	301	496	276	2	278
Sales and net transfers (to)/from LHFS	(568)		(99)	(667)	(751)	(14)	(765)
Six months ended June 30,
Purchases	$	611	304	915	376	2	378
Sales and net transfers (to)/from LHFS	(1,683)		(100)	(1,783)	(1,312)	(23)	(1,335)

Unfunded Credit Commitments

The contractual amount of our unfunded credit commitments, including unissued letters of credit, is summarized in Table 5.4. The table is presented net of commitments syndicated to others, including the fronting arrangements described above, and excludes issued letters of credit and discretionary amounts where our approval or consent is required prior to any loan funding or commitment increase.

Table 5.4: Unfunded Credit Commitments

(in millions)	Jun 30, 2023		Dec 31, 2022
Commercial and industrial (1)	$	385,949	388,504
Commercial real estate	25,348		29,518
Total commercial	411,297		418,022
Residential mortgage (2)	34,668		39,155
Credit card	157,271		145,526
Other consumer (3)	78,032		69,244
Total consumer	269,971		253,925
Total unfunded credit commitments	$	681,268	671,947

(1)Effective first quarter 2023, unfunded credit commitments exclude discretionary amounts where our approval or consent is required prior to any loan funding or commitment increase. Prior period balances have been revised to conform with the current period presentation.

(2)Includes lines of credit totaling $31.9 billion and $35.5 billion as of June 30, 2023, and December 31, 2022, respectively.

(3)Predominantly includes securities-based lines of credit.

Allowance for Credit Losses for Loans

Table 5.5 presents the allowance for credit losses (ACL) for loans, which consists of the allowance for loan losses and the allowance for unfunded credit commitments. The ACL for loans increased $1.2 billion from December 31, 2022, reflecting increases for commercial real estate loans, primarily office loans, as well as for increases in credit card loan balances, partially offset by a decrease for residential mortgage loans related to the adoption of ASU 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures.

Table 5.5: Allowance for Credit Losses for Loans

	Quarter ended June 30,				Six months ended June 30,
($ in millions)	2023			2022	2023			2022
Balance, beginning of period	$	13,705		12,681	$	13,609		13,788
Cumulative effect from change in accounting policy (1)	—			—	(429)			—
Balance, beginning of period, adjusted	13,705			12,681	13,180			13,788
Provision for credit losses	1,839			578	2,968			(197)
Interest income on certain loans (2)	—			(27)	—			(56)
Loan charge-offs:
Commercial and industrial	(147)			(68)	(248)			(124)
Commercial real estate	(81)			(3)	(108)			(3)
Lease financing	(6)			(5)	(13)			(9)
Total commercial	(234)			(76)	(369)			(136)
Residential mortgage	(32)			(46)	(60)			(93)
Credit card	(480)			(287)	(904)			(554)
Auto	(183)			(151)	(400)			(316)
Other consumer	(110)			(94)	(215)			(202)
Total consumer	(805)			(578)	(1,579)			(1,165)
Total loan charge-offs	(1,039)			(654)	(1,948)			(1,301)
Loan recoveries:
Commercial and industrial	28			41	86			120
Commercial real estate	2			7	12			12
Lease financing	4			5	8			10
Total commercial	34			53	106			142
Residential mortgage	44			62	83			130
Credit card	84			88	164			179
Auto	94			83	190			152
Other consumer	19			24	37			49
Total consumer	241			257	474			510
Total loan recoveries	275			310	580			652
Net loan charge-offs	(764)			(344)	(1,368)			(649)
Other	6			(4)	6			(2)
Balance, end of period	$	14,786		12,884	$	14,786		12,884
Components:
Allowance for loan losses	$	14,258		11,786	$	14,258		11,786
Allowance for unfunded credit commitments	528			1,098	528			1,098
Allowance for credit losses	$	14,786		12,884	$	14,786		12,884
Net loan charge-offs (annualized) as a percentage of average total loans	0.32		%	0.15	0.29		%	0.14
Allowance for loan losses as a percentage of total loans	1.50			1.25	1.50			1.25
Allowance for credit losses for loans as a percentage of total loans	1.56			1.37	1.56			1.37

(1)Represents the change in our allowance for credit losses for loans as a result of our adoption of ASU 2022–02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, on January 1, 2023. For additional information, see Note 1 (Summary of Significant Accounting Policies).

(2)Prior to the adoption of ASU 2022–02, loans with an allowance measured by discounting expected cash flows using the loan’s effective interest rate over the remaining life of the loan recognized changes in allowance attributable to the passage of time as interest income.

Allowance for Credit Losses for Loans Activity by Portfolio Segment

Table 5.6 summarizes the activity in the ACL by our commercial and consumer portfolio segments. 

Table 5.6: Allowance for Credit Losses for Loans Activity by Portfolio Segment

	2023				2022
(in millions)	Commercial		Consumer	Total	Commercial	Consumer	Total
Quarter ended June 30,
Balance, beginning of period	$	7,224	6,481	13,705	7,148	5,533	12,681
Provision for credit losses	1,056		783	1,839	(32)	610	578
Interest income on certain loans (2)	—		—	—	(7)	(20)	(27)
Loan charge-offs	(234)		(805)	(1,039)	(76)	(578)	(654)
Loan recoveries	34		241	275	53	257	310
Net loan charge-offs	(200)		(564)	(764)	(23)	(321)	(344)
Other	1		5	6	(4)	—	(4)
Balance, end of period	$	8,081	6,705	14,786	7,082	5,802	12,884
Six months ended June 30,
Balance, beginning of period	$	6,956	6,653	13,609	7,791	5,997	13,788
Cumulative effect from change in accounting policy (1)	27		(456)	(429)	—	—	—
Balance, beginning of period, adjusted	6,983		6,197	13,180	7,791	5,997	13,788
Provision for credit losses	1,360		1,608	2,968	(697)	500	(197)
Interest income on certain loans (2)	—		—	—	(16)	(40)	(56)
Loan charge-offs	(369)		(1,579)	(1,948)	(136)	(1,165)	(1,301)
Loan recoveries	106		474	580	142	510	652
Net loan charge-offs	(263)		(1,105)	(1,368)	6	(655)	(649)
Other	1		5	6	(2)	—	(2)
Balance, end of period	$	8,081	6,705	14,786	7,082	5,802	12,884

(1)Represents the change in our allowance for credit losses for loans as a result of our adoption of ASU 2022–02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, on January 1, 2023. For additional information, see Note 1 (Summary of Significant Accounting Policies).

(2)Prior to the adoption of ASU 2022–02, loans with an allowance measured by discounting expected cash flows using the loan’s effective interest rate over the remaining life of the loan recognized changes in allowance attributable to the passage of time as interest income.

Commercial Loan Categories by Risk Categories and Vintage

Table 5.7 provides the outstanding balances of our commercial loan portfolio by risk category and credit quality information by origination year for term loans. Revolving loans may convert to term loans as a result of a contractual provision in the original loan agreement or if modified for a borrower experiencing financial difficulty. At June 30, 2023, we had $526.6 billion and $29.0 billion of pass and criticized commercial loans, respectively. Gross charge-offs by loan class are included in the following table for the six months ended June 30, 2023, which we monitor as part of our credit risk management practices; however, charge-offs are not a primary credit quality indicator for our loan portfolio.

Table 5.7: Commercial Loan Categories by Risk Categories and Vintage

	Term loans by origination year							Revolving loans	Revolving loans converted to term loans	Total
(in millions)	2023		2022	2021	2020	2019	Prior
June 30, 2023
Commercial and industrial
Pass	$	23,104	46,411	26,818	9,572	13,184	6,280	248,358	442	374,169
Criticized	475		932	1,347	599	337	793	7,359	—	11,842
Total commercial and industrial	23,579		47,343	28,165	10,171	13,521	7,073	255,717	442	386,011
Gross charge-offs (1)	46		14	19	3	5	3	158	—	248
Commercial real estate
Pass	8,771		36,283	36,258	14,186	14,228	22,240	6,103	224	138,293
Criticized	1,298		3,223	3,773	1,623	2,672	3,056	338	—	15,983
Total commercial real estate	10,069		39,506	40,031	15,809	16,900	25,296	6,441	224	154,276
Gross charge-offs	—		32	—	—	36	40	—	—	108
Lease financing
Pass	2,439		4,390	2,851	1,523	1,071	1,878	—	—	14,152
Criticized	172		335	252	174	138	111	—	—	1,182
Total lease financing	2,611		4,725	3,103	1,697	1,209	1,989	—	—	15,334
Gross charge-offs	—		3	4	3	2	1	—	—	13
Total commercial loans	$	36,259	91,574	71,299	27,677	31,630	34,358	262,158	666	555,621
	Term loans by origination year							Revolving loans	Revolving loans converted to term loans	Total
	2022		2021	2020	2019	2018	Prior
December 31, 2022
Commercial and industrial
Pass	$	61,646	31,376	11,128	13,656	3,285	5,739	247,594	842	375,266
Criticized	872		1,244	478	505	665	532	7,244	—	11,540
Total commercial and industrial	62,518		32,620	11,606	14,161	3,950	6,271	254,838	842	386,806
Commercial real estate
Pass	38,022		38,709	16,564	16,409	10,587	16,159	6,765	150	143,365
Criticized	2,785		2,794	965	2,958	1,088	1,688	159	—	12,437
Total commercial real estate	40,807		41,503	17,529	19,367	11,675	17,847	6,924	150	155,802
Lease financing
Pass	4,543		3,336	1,990	1,427	765	1,752	—	—	13,813
Criticized	330		275	190	169	94	37	—	—	1,095
Total lease financing	4,873		3,611	2,180	1,596	859	1,789	—	—	14,908
Total commercial loans	$	108,198	77,734	31,315	35,124	16,484	25,907	261,762	992	557,516

(1) Includes charge-offs on overdrafts, which are generally charged-off at 60 days past due.

Commercial Loan Categories by Delinquency Status

Table 5.8 provides days past due (DPD) information for commercial loans, which we monitor as part of our credit risk

management practices; however, delinquency is not a primary credit quality indicator for commercial loans.

Table 5.8: Commercial Loan Categories by Delinquency Status

	Still accruing				Nonaccrual loans	Total commercial loans
(in millions)	Current-29 DPD		30-89 DPD	90+ DPD
June 30, 2023
Commercial and industrial	$	384,568	489	109	845	386,011
Commercial real estate	151,314		446	9	2,507	154,276
Lease financing	15,118		139	—	77	15,334
Total commercial loans	$	551,000	1,074	118	3,429	555,621
December 31, 2022
Commercial and industrial	$	384,164	1,313	583	746	386,806
Commercial real estate	153,877		833	134	958	155,802
Lease financing	14,623		166	—	119	14,908
Total commercial loans	$	552,664	2,312	717	1,823	557,516

Credit Quality Indicators for Residential Mortgage Loans by Vintage

Table 5.9 provides the outstanding balances of our residential mortgage loans by our primary credit quality indicators.

LTV refers to the ratio comparing the loan’s outstanding balance to the property’s collateral value. Combined LTV (CLTV) refers to the combination of first lien mortgage and junior lien mortgage (including unused line amounts for credit line products) ratios. We obtain LTVs and CLTVs using a cascade approach which first uses values provided by automated valuation models (AVMs) for the property. If an AVM is not available, then the value is estimated using the original appraised value adjusted by the change in Home Price Index (HPI) for the property location. If an HPI is not available, the original appraised value is used. The HPI value is normally the only method considered for high value properties, generally with an original value of $1 million or more, as the AVM values have proven less accurate for these properties. Generally, we obtain available LTVs and CLTVs on a quarterly basis. Certain loans do not have an LTV or CLTV due to a lack of industry data availability and portfolios acquired from or serviced by other institutions.

Table 5.9: Credit Quality Indicators for Residential Mortgage Loans by Vintage

	Term loans by origination year							Revolving loans	Revolving loans converted to term loans
(in millions)	2023		2022	2021	2020	2019	Prior			Total
June 30, 2023
By delinquency status:
Current-29 DPD	$	7,563	47,273	64,124	36,178	20,093	64,105	9,133	6,933	255,402
30-89 DPD	5		33	47	28	24	595	44	140	916
90+ DPD	—		15	14	10	17	376	28	240	700
Government insured/guaranteed loans (1)	—		13	52	110	128	7,764	—	—	8,067
Total residential mortgage	$	7,568	47,334	64,237	36,326	20,262	72,840	9,205	7,313	265,085
By FICO:
740+	$	6,986	43,178	60,223	34,287	18,713	54,060	7,235	4,191	228,873
700-739	461		2,553	2,598	1,254	845	4,706	988	1,008	14,413
660-699	90		852	797	408	339	2,418	479	638	6,021
620-659	14		219	197	97	90	1,082	173	332	2,204
<620	2		84	74	59	47	1,206	189	452	2,113
No FICO available	15		435	296	111	100	1,604	141	692	3,394
Government insured/guaranteed loans (1)	—		13	52	110	128	7,764	—	—	8,067
Total residential mortgage	$	7,568	47,334	64,237	36,326	20,262	72,840	9,205	7,313	265,085
By LTV/CLTV:
0-80%	$	7,487	36,290	62,637	35,948	19,871	64,653	9,024	7,113	243,023
80.01-100%	70		10,770	1,462	197	193	212	140	141	13,185
>100% (2)	—		177	28	11	13	32	25	30	316
No LTV available	11		84	58	60	57	179	16	29	494
Government insured/guaranteed loans (1)	—		13	52	110	128	7,764	—	—	8,067
Total residential mortgage	$	7,568	47,334	64,237	36,326	20,262	72,840	9,205	7,313	265,085
Gross charge-offs	$	—	—	—	—	—	28	2	30	60
	Term loans by origination year							Revolving loans	Revolving loans converted to term loans	Total
(in millions)	2022		2021	2020	2019	2018	Prior
December 31, 2022
By delinquency status:
Current-29 DPD	$	48,581	65,705	37,289	20,851	6,190	61,680	11,031	6,913	258,240
30-89 DPD	65		66	32	33	21	683	58	159	1,117
90+ DPD	6		17	15	25	15	530	32	260	900
Government insured/guaranteed loans (1)	9		59	133	148	200	8,311	—	—	8,860
Total residential mortgage	$	48,661	65,847	37,469	21,057	6,426	71,204	11,121	7,332	269,117
By FICO:
740+	$	43,976	61,450	35,221	19,437	5,610	51,551	8,664	4,139	230,048
700-739	3,245		2,999	1,419	941	314	4,740	1,159	1,021	15,838
660-699	1,060		851	438	306	169	2,388	567	656	6,435
620-659	211		248	106	82	50	1,225	223	349	2,494
<620	59		81	44	46	28	1,323	227	466	2,274
No FICO available	101		159	108	97	55	1,666	281	701	3,168
Government insured/guaranteed loans (1)	9		59	133	148	200	8,311	—	—	8,860
Total residential mortgage	$	48,661	65,847	37,469	21,057	6,426	71,204	11,121	7,332	269,117
By LTV/CLTV:
0-80%	$	40,869	64,613	37,145	20,744	6,155	62,593	10,923	7,188	250,230
80.01-100%	7,670		1,058	112	97	30	107	109	97	9,280
>100% (2)	48		20	13	6	3	23	28	16	157
No LTV available	65		97	66	62	38	170	61	31	590
Government insured/guaranteed loans (1)	9		59	133	148	200	8,311	—	—	8,860
Total residential mortgage	$	48,661	65,847	37,469	21,057	6,426	71,204	11,121	7,332	269,117

(1)Government insured or guaranteed loans represent loans whose repayments are predominantly insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA). Loans insured/guaranteed by the FHA/VA and 90+ DPD totaled $2.8 billion and $3.2 billion at June 30, 2023, and December 31, 2022, respectively.

(2)Reflects total loan balances with LTV/CLTV amounts in excess of 100%. In the event of default, the loss content would generally be limited to only the amount in excess of 100% LTV/CLTV.

Credit Quality Indicators for Credit Card Loans

Table 5.10 provides the outstanding balances of our credit card loan portfolio by primary credit quality indicators.

The revolving loans converted to term loans in the credit card loan category represent credit card loans with modified terms that require payment over a specific term.

For the six months ended June 30, 2023, we had gross charge-offs in the credit card portfolio of $861 million for revolving loans and $43 million for revolving loans converted to term loans.

Table 5.10: Credit Quality Indicators for Credit Card Loans

	June 30, 2023				December 31, 2022
	Revolving loans		Revolving loans converted to term loans		Revolving loans	Revolving loans converted to term loans
(in millions)				Total			Total
By delinquency status:
Current-29 DPD	$	46,343	285	46,628	45,131	223	45,354
30-89 DPD	524		34	558	457	27	484
90+ DPD	513		18	531	441	14	455
Total credit cards	$	47,380	337	47,717	46,029	264	46,293
By FICO:
740+	$	17,730	21	17,751	16,681	19	16,700
700-739	10,894		44	10,938	10,640	37	10,677
660-699	9,653		69	9,722	9,573	55	9,628
620-659	4,826		59	4,885	4,885	45	4,930
<620	4,168		143	4,311	4,071	107	4,178
No FICO available	109		1	110	179	1	180
Total credit cards	$	47,380	337	47,717	46,029	264	46,293

Credit Quality Indicators for Auto Loans by Vintage

Table 5.11 provides the outstanding balances of our Auto loan portfolio by primary credit quality indicators.

Table 5.11: Credit Quality Indicators for Auto Loans by Vintage

	Term loans by origination year							Revolving loans	Revolving loans converted to term loans
(in millions)	2023		2022	2021	2020	2019	Prior			Total
June 30, 2023
By delinquency status:
Current-29 DPD	$	8,891	15,767	15,507	5,790	3,254	979	—	—	50,188
30-89 DPD	15		297	563	217	129	67	—	—	1,288
90+ DPD	1		28	52	16	9	5	—	—	111
Total auto	$	8,907	16,092	16,122	6,023	3,392	1,051	—	—	51,587
By FICO:
740+	$	5,979	7,901	6,879	2,505	1,509	421	—	—	25,194
700-739	1,426		2,480	2,416	971	540	157	—	—	7,990
660-699	917		2,223	2,249	863	444	129	—	—	6,825
620-659	368		1,531	1,613	575	289	94	—	—	4,470
<620	217		1,953	2,935	1,084	582	229	—	—	7,000
No FICO available	—		4	30	25	28	21	—	—	108
Total auto	$	8,907	16,092	16,122	6,023	3,392	1,051	—	—	51,587
Gross charge-offs	$	1	118	195	51	29	6	—	—	400
	Term loans by origination year							Revolving loans	Revolving loans converted to term loans
(in millions)	2022		2021	2020	2019	2018	Prior			Total
December 31, 2022
By delinquency status:
Current-29 DPD	$	19,101	19,126	7,507	4,610	1,445	421	—	—	52,210
30-89 DPD	218		585	253	167	69	45	—	—	1,337
90+ DPD	23		56	22	13	4	4	—	—	122
Total auto	$	19,342	19,767	7,782	4,790	1,518	470	—	—	53,669
By FICO:
740+	$	9,361	8,233	3,193	2,146	664	166	—	—	23,763
700-739	3,090		3,033	1,287	788	238	64	—	—	8,500
660-699	2,789		2,926	1,163	641	192	58	—	—	7,769
620-659	2,021		2,156	796	421	130	47	—	—	5,571
<620	2,062		3,389	1,316	756	263	126	—	—	7,912
No FICO available	19		30	27	38	31	9	—	—	154
Total auto	$	19,342	19,767	7,782	4,790	1,518	470	—	—	53,669

Credit Quality Indicators for Other Consumer Loans by Vintage

Table 5.12 provides the outstanding balances of our Other consumer loans portfolio by primary credit quality indicators.

Table 5.12: Credit Quality Indicators for Other Consumer Loans by Vintage

	Term loans by origination year							Revolving loans	Revolving loans converted to term loans
(in millions)	2023		2022	2021	2020	2019	Prior			Total
June 30, 2023
By delinquency status:
Current-29 DPD	$	2,195	2,825	870	242	151	85	21,352	117	27,837
30-89 DPD	6		28	10	2	2	3	14	5	70
90+ DPD	1		10	4	1	1	1	13	12	43
Total other consumer	$	2,202	2,863	884	245	154	89	21,379	134	27,950
By FICO:
740+	$	1,317	1,354	390	117	67	38	1,347	34	4,664
700-739	440		540	154	44	26	15	510	17	1,746
660-699	262		443	126	22	20	12	401	15	1,301
620-659	64		188	60	9	9	8	154	14	506
<620	20		131	56	10	11	8	142	17	395
No FICO available (1)	99		207	98	43	21	8	18,825	37	19,338
Total other consumer	$	2,202	2,863	884	245	154	89	21,379	134	27,950
Gross charge-offs (2)	$	54	83	28	5	5	3	30	7	215
	Term loans by origination year							Revolving loans	Revolving loans converted to term loans	Total
(in millions)	2022		2021	2020	2019	2018	Prior
December 31, 2022
By delinquency status:
Current-29 DPD	$	3,718	1,184	341	240	63	83	23,431	117	29,177
30-89 DPD	17		12	2	3	1	2	14	8	59
90+ DPD	5		5	1	1	—	1	13	14	40
Total other consumer	$	3,740	1,201	344	244	64	86	23,458	139	29,276
By FICO:
740+	$	1,908	546	174	112	21	50	1,660	43	4,514
700-739	726		216	62	44	10	13	568	18	1,657
660-699	527		177	34	33	9	8	449	19	1,256
620-659	204		81	13	14	4	5	181	11	513
<620	89		64	14	16	5	5	154	18	365
No FICO available (1)	286		117	47	25	15	5	20,446	30	20,971
Total other consumer	$	3,740	1,201	344	244	64	86	23,458	139	29,276

(1)Substantially all loans do not require a FICO score and are revolving securities-based loans originated by the Wealth and Investment Management operating segment.

(2)Includes charge-offs on overdrafts, which are generally charged-off at 60 days past due.

Nonaccrual Loans

Table 5.13 provides loans on nonaccrual status. Nonaccrual loans may have an ACL or a negative allowance for credit losses from expected recoveries of amounts previously written off.

Table 5.13: Nonaccrual Loans

	Amortized cost					Recognized interest income
	Nonaccrual loans			Nonaccrual loans without related allowance for credit losses (1)		Six months ended June 30,
(in millions)	Jun 30, 2023		Dec 31, 2022	Jun 30, 2023	Dec 31, 2022	2023	2022
Commercial and industrial	$	845	746	241	174	12	41
Commercial real estate	2,507		958	97	134	14	28
Lease financing	77		119	5	5	—	—
Total commercial	3,429		1,823	343	313	26	69
Residential mortgage	3,289		3,611	2,197	2,316	98	111
Auto	135		153	—	—	10	14
Other consumer	33		39	—	—	2	2
Total consumer	3,457		3,803	2,197	2,316	110	127
Total nonaccrual loans	$	6,886	5,626	2,540	2,629	136	196

(1)Nonaccrual loans may not have an allowance for credit losses if the loss expectations are zero given the related collateral value.

Loans 90 Days or More Past Due and Still Accruing

Table 5.14 shows loans 90 days or more past due and still accruing by class for loans not government insured/guaranteed.

Table 5.14: Loans 90 Days or More Past Due and Still Accruing

(in millions)	Jun 30, 2023		Dec 31, 2022
Total:	$	3,485	4,340
Less: FHA insured/VA guaranteed (1)	2,686		3,005
Total, not government insured/guaranteed	$	799	1,335
By segment and class, not government insured/guaranteed:
Commercial and industrial	$	109	583
Commercial real estate	9		134
Total commercial	118		717
Residential mortgage	25		28
Credit card	531		455
Auto	96		111
Other consumer	29		24
Total consumer	681		618
Total, not government insured/guaranteed	$	799	1,335

(1)Represents loans whose repayments are predominantly insured by the FHA or guaranteed by the VA

Commercial Loan Modifications

Table 5.15 presents the amortized cost of modified commercial loans by class of financing receivable and by modification type.

Table 5.15: Commercial Loan Modifications

	Modification type (1)							Modifications as a % of loan class
($ in millions)	Interest rate reduction		Payment delay	Term extension	Term extension & payment delay	All other modifications and combinations	Total
Quarter ended June 30, 2023
Commercial and industrial	$	5	21	199	4	—	229	0.06	%
Commercial real estate	—		—	148	—	1	149	0.10
Total commercial	$	5	21	347	4	1	378	0.07
Six months ended June 30, 2023
Commercial and industrial	$	9	23	226	5	1	264	0.07	%
Commercial real estate	7		1	190	—	2	200	0.13
Total commercial	$	16	24	416	5	3	464	0.09

(1)There were no principal forgiveness modifications for the quarter and six months ended June 30, 2023.

Financial Effects of Commercial Loan Modifications

Table 5.15a presents the financial effects of modifications made to commercial loans presented by class of financing receivable.

Table 5.15a: Financial Effects of Commercial Loan Modifications

	Weighted average interest rate reduction		Weighted average payments deferred (months)	Weighted average term extension (months)
Quarter ended June 30, 2023
Commercial and industrial	13.86	%	10	6
Commercial real estate	0.71		34	7
Six months ended June 30, 2023
Commercial and industrial	12.62	%	9	7
Commercial real estate	3.47		15	10

Payment Performance of Commercial Loan Modifications

Table 5.15b provides past due information for modified commercial loans. For loan modifications that include a payment deferral, payment performance is not included in the table below until the loan exits the deferral period and payments resume. The table also includes the amount of gross charge-offs that occurred during the second quarter and first half of 2023, inclusive of charge-offs to loans with no amortized cost remaining at period end.

Table 5.15b: Payment Performance of Commercial Loan Modifications

	By delinquency status					Gross charge-offs
(in millions)	Current-29 days past due (DPD)		30-89 DPD	90+ DPD	Total	Quarter ended	Six months ended
June 30, 2023
Commercial and industrial	$	235	3	1	239	5	15
Commercial real estate	124		76	—	200	—	—
Total commercial	$	359	79	1	439	5	15

Consumer Loan Modifications

Table 5.16 presents the amortized cost of modified consumer loans by class of financing receivable and by modification type.

Table 5.16: Consumer Loan Modifications

	Modification type
($ in millions)	Interest rate reduction		Payment delay (1)	Term extension	Interest rate reduction & term extension	Term extension & payment delay	Interest rate reduction, term extension & payment delay	All other modifications and combinations (2)	Total	Modifications as a % of loan class
Quarter ended June 30, 2023
Residential mortgage	$	3	213	17	10	25	22	1	291	0.11	%
Credit card	126		—	—	—	—	—	—	126	0.26
Auto	1		9	—	—	—	—	—	10	0.02
Other consumer	3		1	—	8	—	—	—	12	0.04
Total consumer	$	133	223	17	18	25	22	1	439	0.11
Six months ended June 30, 2023
Residential mortgage	$	7	461	41	23	54	53	3	642	0.24	%
Credit card	230		—	—	—	—	—	—	230	0.48
Auto	2		13	—	—	—	—	—	15	0.03
Other consumer	6		2	—	13	—	—	—	21	0.08
Total consumer	$	245	476	41	36	54	53	3	908	0.23

(1)Includes residential mortgage loan modifications that defer a set amount of principal to the end of the loan term.

(2)Includes principal forgiveness and other combinations of modifications.

Financial Effects of Consumer Loan Modifications

Table 5.16a presents the financial effects of modifications made to consumer loans by class of financing receivable.

Table 5.16a: Financial Effects of Consumer Loan Modifications (1)

	Weighted average interest rate reduction		Weighted average payments deferred (months)	Weighted average term extension (years)
Quarter ended June 30, 2023
Residential mortgage (2)	1.55	%	4	9.4
Credit card	22.17		N/A	N/A
Auto	3.86		6	N/A
Other consumer	12.15		3	10.9
Six months ended June 30, 2023
Residential mortgage (2)	1.57	%	4	9.8
Credit card	21.92		N/A	N/A
Auto	3.94		6	N/A
Other consumer	11.69		4	2.7

(1)Principal forgiven was insignificant for the quarter and six months ended June 30, 2023.

(2)Excludes the financial effects of residential mortgage loans with a set amount of principal deferred to the end of the loan term. The weighted average period of principal deferred was 26.8 years for the quarter ended June 30, 2023, and 27.0 years for the six months ended June 30, 2023

Payment Performance of Consumer Loan Modifications

Table 5.16b provides past due information for modified consumer loans. For loan modifications that include a payment delay, payment performance is not included in the table below until the loan exits the deferral period and payments resume. The table also includes the amount of gross charge-offs that occurred during the second quarter and first half of 2023, inclusive of charge-offs to loans with no amortized cost remaining at period end.

Table 5.16b: Payment Performance of Consumer Loan Modifications

	By delinquency status					Gross charge-offs
(in millions)	Current-29 days past due (DPD)		30-89 DPD	90+ DPD	Total	Quarter ended	Six months ended
June 30, 2023
Residential mortgage (1)	$	283	45	139	467	2	3
Credit card (2)	167		36	27	230	16	20
Auto	14		1	—	15	—	—
Other consumer	18		2	1	21	1	1
Total	$	482	84	167	733	19	24

(1)Includes loans that were past due prior to entering a payment delay modification. Delinquency advancement is paused during the deferral period and resumes upon exit. 

(2)Credit card loans that are past due at the time of the modification do not become current until they have three months of consecutive payment performance.

TDR Modifications

Table 5.17 summarizes our TDR modifications by primary modification type and includes the financial effects of these modifications. For those loans that modify more than once, the table reflects each modification that occurred during the period. Loans that both modify and are paid off or written-off within the period, as well as changes in recorded investment during the period for loans modified in prior periods, are not included in the table.

Table 5.17: TDR Modifications

	Primary modification type (1)					Financial effects of modifications
($ in millions)	Principal forgiveness		Interest rate reduction	Other concessions (2)	Total	Charge- offs (3)	Weighted average interest rate reduction		Recorded investment related to interest rate reduction (4)
Quarter ended June 30, 2022
Commercial and industrial	$	—	8	75	83	—	7.09	%	$	8
Commercial real estate	—		5	38	43	—	0.62		5
Lease financing	—		—	1	1	—	—		—
Total commercial	—		13	114	127	—	4.38		13
Residential mortgage	—		127	350	477	2	1.54		127
Credit card	—		63	—	63	—	19.23		63
Auto	—		1	8	9	2	4.02		1
Other consumer	—		4	—	4	—	11.01		4
Trial modifications (5)	—		—	41	41	—	—		—
Total consumer	—		195	399	594	4	7.47		195
Total	$	—	208	513	721	4	7.28		$	208
Six months ended June 30, 2022
Commercial and industrial	$	—	14	148	162	—	8.37	%	$	14
Commercial real estate	—		10	65	75	—	0.99		10
Lease financing	—		—	1	1	—	—		—
Total commercial	—		24	214	238	—	5.27		24
Residential mortgage	1		195	686	882	3	1.58		195
Credit card	—		133	—	133	—	19.17		133
Auto	1		4	48	53	11	4.64		4
Other consumer	—		7	1	8	—	11.31		7
Trial modifications (5)	—		—	252	252	—	—		—
Total consumer	2		339	987	1,328	14	8.73		339
Total	$	2	363	1,201	1,566	14	8.50	%	$	363

(1)Amounts represent the recorded investment in loans after recognizing the effects of the TDR, if any. TDRs may have multiple types of concessions, but are presented only once in the first modification type based on the order presented in the table above. The reported amounts include loans remodified of $132 million for the quarter ended June 30, 2022, and $250 million for the first half of 2022.

(2)Other concessions include loans with payment (principal and/or interest) deferral, loans discharged in bankruptcy, loan renewals, term extensions and other interest and noninterest adjustments, but exclude modifications that also forgive principal and/or reduce the contractual interest rate. The reported amounts include loans that are new TDRs that may have COVID-19-related payment deferrals and exclude COVID-19-related payment deferrals on loans previously reported as TDRs given limited current financial effects other than payment deferral.

(3)Charge-offs include write-downs of the investment in the loan in the period it is contractually modified. The amount of charge-off will differ from the modification terms if the loan has been charged down prior to the modification based on our policies. In addition, there may be cases where we have a charge-off/down with no legal principal modification.

(4)Recorded investment related to interest rate reduction reflects the effect of reduced interest rates on loans with an interest rate concession as one of their concession types, which includes loans reported as a principal primary modification type that also have an interest rate concession.

(5)Trial modifications are granted a delay in payments due under the original terms during the trial payment period. However, these loans continue to advance through delinquency status and accrue interest according to their original terms. Any subsequent permanent modification generally includes interest rate related concessions; however, the exact concession type and resulting financial effect are usually not known until the loan is permanently modified. Trial modifications for the period are presented net of previously reported trial modifications that became permanent in the current period.

Defaulted TDRs

Table 5.18 summarizes permanent modification TDRs that defaulted during the period presented within 12 months of their permanent modification date. We are reporting these defaulted TDRs based on a payment default definition of 90 days past due for the commercial portfolio segment and 60 days past due for the consumer portfolio segment.

Table 5.18: Defaulted TDRs

	Recorded investment of defaults
	June 30, 2022
(in millions)	Quarter ended		Six months ended
Commercial and industrial	$	3	52
Commercial real estate	8		10
Lease financing	—		—
Total commercial	11		62
Residential mortgage	51		58
Credit card	8		13
Auto	7		13
Other consumer	1		1
Total consumer	67		85
Total	$	78	147