NOTE 5 - ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses consists of the ALLL and the reserve for unfunded commitments. Activity in the allowance for credit losses is summarized in the table below:



	Three Months Ended March 31
(Dollars in millions)	2014			2013
Balance at beginning of period		$2,094			$2,219
Provision for loan losses	106			204
(Benefit)/provision for unfunded commitments	(4		)	8
Loan charge-offs	(151		)	(273		)
Loan recoveries	41			47
Balance at end of period		$2,086			$2,205

Components:
ALLL		$2,040			$2,152
Unfunded commitments reserve¹	46			53
Allowance for credit losses		$2,086			$2,205

¹The unfunded commitments reserve is recorded in other liabilities in the Consolidated Balance Sheets.

Activity in the ALLL by segment for the three months ended March 31, 2014 and 2013 is presented in the tables below:




	Three Months Ended March 31, 2014
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance at beginning of period		$946			$930			$168			$2,044
Provision for loan losses	39			48			19			106
Loan charge-offs	(33		)	(85		)	(33		)	(151		)
Loan recoveries	14			17			10			41
Balance at end of period		$966			$910			$164			$2,040

	Three Months Ended March 31, 2013
(Dollars in millions)	Commercial			Residential			Consumer			Total
Balance at beginning of period		$902			$1,131			$141			$2,174
Provision for loan losses	64			112			28			204
Loan charge-offs	(60		)	(178		)	(35		)	(273		)
Loan recoveries	15			22			10			47
Balance at end of period		$921			$1,087			$144			$2,152

As discussed in Note 1, “Significant Accounting Policies,” to the Company's 2013 Annual Report on Form 10-K, the ALLL is composed of both specific allowances for certain nonaccrual loans and TDRs and general allowances grouped into loan pools based on similar characteristics. No allowance is required for loans carried at fair value. Additionally, the Company records an immaterial allowance for loan products that are guaranteed by government agencies, as there is nominal risk of principal loss.

The Company’s LHFI portfolio and related ALLL is shown in the tables below:



	March 31, 2014
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		Associated ALLL		Carrying Value		Associated ALLL		Carrying Value		Associated ALLL		Carrying Value		Associated ALLL
Individually evaluated		$141		$15		$2,843		$357		$116		$8		$3,100		$380
Collectively evaluated	65,568		951		39,653		553		20,576		156		125,797		1,660
Total evaluated	65,709		966		42,496		910		20,692		164		128,897		2,040
LHFI at fair value	—		—		299		—		—		—		299		—
Total LHFI		$65,709		$966		$42,795		$910		$20,692		$164		$129,196		$2,040

	December 31, 2013
	Commercial				Residential				Consumer				Total
(Dollars in millions)	Carrying Value		Associated ALLL		Carrying Value		Associated ALLL		Carrying Value		Associated ALLL		Carrying Value		Associated ALLL
Individually evaluated		$171		$10		$2,878		$345		$110		$8		$3,159		$363
Collectively evaluated	64,139		936		40,010		585		20,267		160		124,416		1,681
Total evaluated	64,310		946		42,888		930		20,377		168		127,575		2,044
LHFI at fair value	—		—		302		—		—		—		302		—
Total LHFI		$64,310		$946		$43,190		$930		$20,377		$168		$127,877		$2,044