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Business Segment Reporting
 9 Months Ended
Sep. 30, 2018
Segment Reporting [Abstract]  
Business Segment Reporting
NOTE 18 - BUSINESS SEGMENT REPORTING
The Company operates and measures business activity across two segments: Consumer and Wholesale, with functional activities included in Corporate Other. The Company's business segment structure is based on the manner in which financial information is evaluated by management as well as the products and services provided or the type of client served. In the second quarter of 2018, certain business banking clients within Commercial Banking were transferred from the Wholesale segment to the Consumer segment to create greater consistency in delivering tailored solutions to business banking clients through the alignment of client coverage and client service in branches. Prior period business segment results were revised to conform with this updated business segment structure. Additionally, the transfer resulted in a reallocation of goodwill from Wholesale to Consumer, as disclosed in Note 8, "Goodwill and Other Intangible Assets."
The following is a description of the segments and their primary businesses at September 30, 2018.

The Consumer segment is made up of four primary businesses:
•
Consumer Banking provides services to individual consumers, small business, and business banking clients through an extensive network of traditional and in-store branches, ATMs, online banking (www.suntrust.com), mobile banking, and by telephone (1-800-SUNTRUST). Financial products and services offered to consumers and small business clients include deposits and payments, loans, and various fee-based services. Consumer Banking also serves as an entry point for clients and provides services for other businesses.
•
Consumer Lending offers an array of lending products to individual consumers and small business clients via the Company's Consumer Banking and PWM businesses, through the internet (www.suntrust.com and www.lightstream.com), as well as through various national offices and partnerships. Products offered include home equity lines, personal credit lines and loans, direct auto, indirect auto, student lending, credit cards, and other lending products.
•
PWM provides a full array of wealth management products and professional services to individual consumers and institutional clients, including loans, deposits, brokerage, professional investment advisory, and trust services to clients seeking active management of their financial resources. Institutional clients are served by the Institutional Investment Solutions business. Discount/online and full-service brokerage products are offered to individual clients through STIS. Investment advisory products and services are offered to clients by STAS, an SEC registered investment advisor. PWM also includes GFO Advisory Services, LLC, which provides family office solutions to clients and their families to help them manage and sustain wealth across multiple generations, including family meeting facilitation, consolidated reporting, expense management, specialty asset management, and business transition advice, as well as other wealth management disciplines.
•
Mortgage Banking offers residential mortgage products nationally through its retail and correspondent channels, the internet (www.suntrust.com), and by telephone (1-800-SUNTRUST). These products are either sold in the secondary market, primarily with servicing rights retained, or held in the Company’s loan portfolio. Mortgage Banking also services loans for other investors, in addition to loans held in the Company’s loan portfolio.
◦
The Company successfully merged its STM and Bank legal entities in the third quarter of 2018. Subsequent to the merger, mortgage operations have continued under the Bank’s charter. This merger will simplify the Company's organizational structure and allow it to more fully serve the needs of clients. There were no material financial impacts associated with the merger, other than the tax impacts described in Note 12, “Income Taxes.”
The Wholesale segment is made up of three primary businesses and the Treasury & Payment Solutions product group:
•
CIB delivers comprehensive capital markets solutions, including advisory, capital raising, and financial risk management, with the goal of serving the needs of both public and private companies in the Wholesale segment and PWM business. Investment Banking and Corporate Banking teams within CIB serve clients across the nation, offering a full suite of traditional banking and investment banking products and services to companies with annual revenues typically greater than $150 million. Investment Banking serves select industry segments including consumer and retail, energy, technology, financial services, healthcare, industrials, and media and communications. Corporate Banking serves clients across diversified industry sectors based on size, complexity, and frequency of capital markets issuance. CIB also includes the Company's Asset Finance Group, which offers a full complement of asset-based financing solutions such as securitizations, asset-based lending, equipment financing, and structured real estate arrangements.
•
Commercial Banking offers an array of traditional banking products, including lending, cash management, and investment banking solutions via CIB, to commercial clients (generally clients with revenues between $5 million and $250 million), including not-for-profit organizations, governmental entities, healthcare and aging services, and auto dealer financing (floor plan inventory financing). Local teams deliver these solutions along with the Company's industry expertise to commercial clients to help them achieve smart growth.
•
Commercial Real Estate provides a range of credit and deposit services as well as fee-based product offerings to privately held real estate companies and institutional funds operating within the office, retail, multifamily, and industrial property sectors. Commercial Real Estate also provides multi-family agency lending and servicing, advisory, and commercial mortgage brokerage services via its Agency Lending division. Additionally, Commercial Real Estate offers tailored financing and equity investment solutions for community development and affordable housing projects through STCC, with particular expertise in Low Income Housing Tax Credits and New Market Tax Credits. The Institutional Property Group business targets relationships with REITs, pension fund advisors, private funds, homebuilders, and insurance companies and the Regional business focuses on private real estate owners and developers through a regional delivery structure. The Investor Services Group offers loan administration, special servicing, valuation, and advisory services to third party clients.
•
Treasury & Payment Solutions provides business clients in the Wholesale segment with services required to manage their payments and receipts, combined with the ability to manage and optimize their deposits across all aspects of their business. Treasury & Payment Solutions operates all electronic and paper payment types, including card, wire transfer, ACH, check, and cash. It also provides clients the means to manage their accounts electronically online, both domestically and internationally.

Corporate Other includes management of the Company’s investment securities portfolio, long-term debt, end user derivative instruments, short-term liquidity and funding activities, balance sheet risk management, and most real estate assets, as well as the Company's functional activities such as marketing, finance, ER, legal, enterprise information services, and executive management, among others. Additionally, for all periods prior to January 1, 2018, the results of PAC were reported in the Wholesale segment and were reclassified to Corporate Other for enhanced comparability of the Wholesale segment results excluding PAC. See Note 2, "Acquisitions/Dispositions," in the Company's 2017 Annual Report on Form 10-K for additional information related to the sale of PAC in December 2017.
Because business segment results are presented based on management accounting practices, the transition to the consolidated results prepared under U.S. GAAP creates certain differences, which are reflected in reconciling items. Business segment reporting conventions are described below.
•
Net interest income-FTE – is reconciled from Net interest income and is grossed-up on an FTE basis to make income from tax-exempt assets comparable to other taxable products. Segment results reflect matched maturity funds transfer pricing, which ascribes credits or charges based on the economic value or cost created by assets and liabilities of each segment. Differences between these credits and charges are captured as reconciling items.
•
Provision for credit losses – represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to each segment's quarterly change in the ALLL and unfunded commitments reserve balances.
•
Noninterest income – includes federal and state tax credits that are grossed-up on a pre-tax equivalent basis, related primarily to certain community development investments.
•
Provision for income taxes-FTE – is calculated using a blended income tax rate for each segment and includes reversals of the tax adjustments and credits described above. The difference between the calculated provision for income taxes at the segment level and the consolidated provision for income taxes is reported as reconciling items.
The segment’s financial performance is comprised of direct financial results and allocations for various corporate functions that provide management an enhanced view of the segment’s financial performance. Internal allocations include the following:
•
Operational costs – expenses are charged to segments based on an activity-based costing process, which also allocates residual expenses to the segments. Generally, recoveries of these costs are reported in Corporate Other.
•
Support and overhead costs – expenses not directly attributable to a specific segment are allocated based on various drivers (number of equivalent employees, number of PCs/laptops, net revenue, etc.). Recoveries for these allocations are reported in Corporate Other.
The application and development of management reporting methodologies is an active process and undergoes periodic enhancements. The implementation of these enhancements to the internal management reporting methodology may materially affect the results disclosed for each segment, with no impact on consolidated results. If significant changes to management reporting methodologies take place, the impact of these changes is quantified and prior period information is revised, when practicable.

 
Three Months Ended September 30, 2018
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$75,414

 

$70,485

 

$96

 

$—

 

$145,995

Average consumer and commercial deposits
111,930

 
47,773

 
212

 
(567
)
 
159,348

Average total assets
86,112

 
84,766

 
35,612

 
905

 
207,395

Average total liabilities
112,879

 
54,284

 
16,481

 
(524
)
 
183,120

Average total equity
—

 
—

 
—

 
24,275

 
24,275

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$1,079

 

$550

 

($49
)
 

($68
)
 

$1,512

FTE adjustment
—

 
22

 
1

 
(1
)
 
22

Net interest income-FTE 1
1,079

 
572

 
(48
)
 
(69
)
 
1,534

Provision for credit losses 2
36

 
25

 
—

 
—

 
61

Net interest income after provision for credit losses-FTE
1,043

 
547

 
(48
)
 
(69
)
 
1,473

Total noninterest income
445

 
373

 
10

 
(46
)
 
782

Total noninterest expense
994

 
433

 
(38
)
 
(5
)
 
1,384

Income before provision for income taxes-FTE
494

 
487

 
—

 
(110
)
 
871

Provision for income taxes-FTE 3
113

 
115

 
(52
)
 
(59
)
 
117

Net income including income attributable to noncontrolling interest
381

 
372

 
52

 
(51
)
 
754

Net income attributable to noncontrolling interest
—

 
—

 
2

 
—

 
2

Net income

$381

 

$372

 

$50

 

($51
)
 

$752

1 Presented on a matched maturity funds transfer price basis for the segments.
2 Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.
3 Includes regular provision for income taxes as well as FTE income and tax credit adjustment reversals.


 
 Three Months Ended September 30, 2017 1, 2
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$74,742

 

$68,568

 

$1,399

 

($3
)
 

$144,706

Average consumer and commercial deposits
109,774

 
49,515

 
189

 
(59
)
 
159,419

Average total assets
84,345

 
82,573

 
36,286

 
2,534

 
205,738

Average total liabilities
110,713

 
55,054

 
15,406

 
(8
)
 
181,165

Average total equity
—

 
—

 
—

 
24,573

 
24,573

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$999

 

$511

 

($5
)
 

($75
)
 

$1,430

FTE adjustment
—

 
36

 
1

 
—

 
37

Net interest income-FTE 3
999

 
547

 
(4
)
 
(75
)
 
1,467

Provision/(benefit) for credit losses 4
140

 
(19
)
 
—

 
(1
)
 
120

Net interest income after provision/(benefit) for credit losses-FTE
859

 
566

 
(4
)
 
(74
)
 
1,347

Total noninterest income
482

 
397

 
19

 
(52
)
 
846

Total noninterest expense
927

 
421

 
48

 
(5
)
 
1,391

Income before provision for income taxes-FTE
414

 
542

 
(33
)
 
(121
)
 
802

Provision for income taxes-FTE 5
150

 
201

 
(18
)
 
(71
)
 
262

Net income including income attributable to noncontrolling interest
264

 
341

 
(15
)
 
(50
)
 
540

Net income attributable to noncontrolling interest
—

 
—

 
2

 
—

 
2

Net income

$264

 

$341

 

($17
)
 

($50
)
 

$538

1 
During the second quarter of 2018, certain of the Company's business banking clients were transferred from the Wholesale business segment to the Consumer business segment. For all periods prior to the second quarter of 2018, the corresponding financial results have been transferred to the Consumer business segment for comparability purposes.
2 
During the fourth quarter of 2017, the Company sold PAC, the results of which were previously reported within the Wholesale business segment. For all periods prior to January 1, 2018, PAC's financial results, including the gain on sale, have been transferred to Corporate Other for enhanced comparability of the Wholesale business segment excluding PAC.
3 
Presented on a matched maturity funds transfer price basis for the segments.
4 
Provision/(benefit) for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision/(benefit) attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.
5 
Includes regular provision for income taxes as well as FTE income and tax credit adjustment reversals.

 
Nine Months Ended September 30, 2018
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$75,122

 

$69,155

 

$93

 

($2
)
 

$144,368

Average consumer and commercial deposits
111,025

 
48,259

 
205

 
(330
)
 
159,159

Average total assets
85,124

 
83,001

 
35,563

 
1,682

 
205,370

Average total liabilities
111,928

 
54,383

 
15,038

 
(303
)
 
181,046

Average total equity
—

 
—

 
—

 
24,324

 
24,324

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$3,144

 

$1,605

 

($120
)
 

($189
)
 

$4,440

FTE adjustment
—

 
63

 
2

 
—

 
65

Net interest income-FTE 1
3,144

 
1,668

 
(118
)
 
(189
)
 
4,505

Provision for credit losses 2
101

 
19

 
—

 
1

 
121

Net interest income after provision for credit losses-FTE
3,043

 
1,649

 
(118
)
 
(190
)
 
4,384

Total noninterest income
1,349

 
1,124

 
50

 
(115
)
 
2,408

Total noninterest expense
2,995

 
1,307

 
(95
)
 
(16
)
 
4,191

Income before provision for income taxes-FTE
1,397

 
1,466

 
27

 
(289
)
 
2,601

Provision for income taxes-FTE 3
316

 
346

 
(29
)
 
(156
)
 
477

Net income including income attributable to noncontrolling interest
1,081

 
1,120

 
56

 
(133
)
 
2,124

Less: Net income attributable to noncontrolling interest
—

 
—

 
7

 
—

 
7

Net income

$1,081

 

$1,120

 

$49

 

($133
)
 

$2,117

1 Presented on a matched maturity funds transfer price basis for the segments.
2 Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.
3 Includes regular provision for income taxes as well as FTE income and tax credit adjustment reversals.


 
 Nine Months Ended September 30, 2017 1, 2
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$73,613

 

$69,303

 

$1,362

 

($2
)
 

$144,276

Average consumer and commercial deposits
109,301

 
49,724

 
149

 
(29
)
 
159,145

Average total assets
83,310

 
82,916

 
35,903

 
2,704

 
204,833

Average total liabilities
110,264

 
55,322

 
15,110

 
6

 
180,702

Average total equity
—

 
—

 
—

 
24,131

 
24,131

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$2,915

 

$1,490

 

$29

 

($235
)
 

$4,199

FTE adjustment
—

 
105

 
2

 
—

 
107

Net interest income-FTE 3
2,915

 
1,595

 
31

 
(235
)
 
4,306

Provision for credit losses 4
310

 
19

 
—

 
1

 
330

Net interest income after provision for credit losses-FTE
2,605

 
1,576

 
31

 
(236
)
 
3,976

Total noninterest income
1,427

 
1,169

 
59

 
(135
)
 
2,520

Total noninterest expense
2,939

 
1,284

 
34

 
(14
)
 
4,243

Income before provision for income taxes-FTE
1,093

 
1,461

 
56

 
(357
)
 
2,253

Provision for income taxes-FTE 5
395

 
544

 
(11
)
 
(215
)
 
713

Net income including income attributable to noncontrolling interest
698

 
917

 
67

 
(142
)
 
1,540

Less: Net income attributable to noncontrolling interest
—

 
—

 
7

 
—

 
7

Net income

$698

 

$917

 

$60

 

($142
)
 

$1,533


1 
During the second quarter of 2018, certain of the Company's business banking clients were transferred from the Wholesale business segment to the Consumer business segment. For all periods prior to the second quarter of 2018, the corresponding financial results have been transferred to the Consumer business segment for comparability purposes.
2 
During the fourth quarter of 2017, the Company sold PAC, the results of which were previously reported within the Wholesale business segment. For all periods prior to January 1, 2018, PAC's financial results, including the gain on sale, have been transferred to Corporate Other for enhanced comparability of the Wholesale business segment excluding PAC.
3 
Presented on a matched maturity funds transfer price basis for the segments.
4 
Provision for credit losses represents net charge-offs by segment combined with an allocation to the segments for the provision attributable to quarterly changes in the ALLL and unfunded commitment reserve balances.
5 
Includes regular provision for income taxes as well as FTE income and tax credit adjustment reversals.