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Business Segment Reporting
 12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Business Segment Reporting NOTE 22 - 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 10, "Goodwill and Other Intangible Assets."
The following is a description of the segments and their primary businesses at December 31, 2018.

The Consumer segment is made up of four primary businesses:
•
Consumer Banking provides services to individual consumers 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 business banking 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 simplified the Company's organizational structure, allowing 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 16, “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 on a regional delivery basis to privately held developers, operators, and investors in commercial real estate properties through its National Banking Division. 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. Real Estate Corporate and Investment Banking targets relationships with REITs and homebuilders, both publicly-traded and privately owned. 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, enterprise risk, 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 3, "Acquisitions/Dispositions," 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.


 
Year Ended December 31, 2018
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$75,427

 

$70,200

 

$89

 

($2
)
 

$145,714

Average consumer and commercial deposits
111,235

 
48,675

 
216

 
(358
)
 
159,768

Average total assets
85,509

 
84,413

 
35,630

 
1,725

 
207,277

Average total liabilities
112,173

 
55,098

 
16,100

 
(304
)
 
183,067

Average total equity
—

 
—

 
—

 
24,210

 
24,210

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$4,235

 

$2,184

 

($190
)
 

($242
)
 

$5,987

FTE adjustment
—

 
86

 
2

 
—

 
88

Net interest income-FTE 1
4,235

 
2,270

 
(188
)
 
(242
)
 
6,075

Provision for credit losses 2
148

 
60

 
—

 
—

 
208

Net interest income after provision for credit losses-FTE
4,087

 
2,210

 
(188
)
 
(242
)
 
5,867

Total noninterest income
1,804

 
1,534

 
57

 
(169
)
 
3,226

Total noninterest expense
4,017

 
1,720

 
(42
)
 
(22
)
 
5,673

Income before provision for income taxes-FTE
1,874

 
2,024

 
(89
)
 
(389
)
 
3,420

Provision for income taxes-FTE 3
424

 
479

 
(61
)
 
(206
)
 
636

Net income including income attributable to noncontrolling interest
1,450

 
1,545

 
(28
)
 
(183
)
 
2,784

Less: Net income attributable to noncontrolling interest
—

 
—

 
9

 
—

 
9

Net income

$1,450

 

$1,545

 

($37
)
 

($183
)
 

$2,775

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.


 
 Year Ended December 31, 2017 1, 2
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$73,578

 

$69,394

 

$1,247

 

($3
)
 

$144,216

Average consumer and commercial deposits
109,298

 
50,155

 
160

 
(64
)
 
159,549

Average total assets
83,278

 
83,091

 
35,931

 
2,631

 
204,931

Average total liabilities
110,271

 
55,762

 
14,626

 
(29
)
 
180,630

Average total equity
—

 
—

 
—

 
24,301

 
24,301

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$3,906

 

$2,029

 

$14

 

($316
)
 

$5,633

FTE adjustment
—

 
142

 
3

 
—

 
145

Net interest income-FTE 3
3,906

 
2,171

 
17

 
(316
)
 
5,778

Provision for credit losses 4
366

 
39

 
4

 
—

 
409

Net interest income after provision for credit losses-FTE
3,540

 
2,132

 
13

 
(316
)
 
5,369

Total noninterest income
1,905

 
1,573

 
73

 
(197
)
 
3,354

Total noninterest expense
3,982

 
1,727

 
74

 
(19
)
 
5,764

Income before provision for income taxes-FTE
1,463

 
1,978

 
12

 
(494
)
 
2,959

Provision for income taxes-FTE 5
529

 
736

 
(292
)
 
(296
)
 
677

Net income including income attributable to noncontrolling interest
934

 
1,242

 
304

 
(198
)
 
2,282

Less: Net income attributable to noncontrolling interest
—

 
—

 
9

 
—

 
9

Net income

$934

 

$1,242

 

$295

 

($198
)
 

$2,273


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.

 
 Year Ended December 31, 2016 1, 2
(Dollars in millions)
Consumer
 
Wholesale
 
Corporate Other
 
Reconciling
Items
 
Consolidated
Balance Sheets:
 
 
 
 
 
 
 
 
 
Average LHFI

$70,455

 

$69,287

 

$1,379

 

($3
)
 

$141,118

Average consumer and commercial deposits
105,365

 
48,782

 
115

 
(73
)
 
154,189

Average total assets
79,971

 
83,168

 
33,425

 
2,440

 
199,004

Average total liabilities
106,374

 
54,457

 
14,179

 
(74
)
 
174,936

Average total equity
—

 
—

 
—

 
24,068

 
24,068

Statements of Income:
 
 
 
 
 
 
 
 
 
Net interest income

$3,636

 

$1,812

 

$160

 

($387
)
 

$5,221

FTE adjustment
—

 
136

 
2

 
—

 
138

Net interest income-FTE 3
3,636

 
1,948

 
162

 
(387
)
 
5,359

Provision for credit losses 4
159

 
282

 
3

 
—

 
444

Net interest income after provision for credit losses-FTE
3,477

 
1,666

 
159

 
(387
)
 
4,915

Total noninterest income
2,067

 
1,325

 
137

 
(146
)
 
3,383

Total noninterest expense
3,938

 
1,507

 
38

 
(15
)
 
5,468

Income before provision for income taxes-FTE
1,606

 
1,484

 
258

 
(518
)
 
2,830

Provision for income taxes-FTE 5
592

 
555

 
70

 
(274
)
 
943

Net income including income attributable to noncontrolling interest
1,014

 
929

 
188

 
(244
)
 
1,887

Less: Net income attributable to noncontrolling interest
—

 
—

 
9

 
—

 
9

Net income

$1,014

 

$929

 

$179

 

($244
)
 

$1,878

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.