LOANS |
LOANS Citigroup loans are reported in two categories—consumer and corporate. These categories are classified primarily according to the segment and subsegment that manage the loans. Consumer Loans Consumer loans represent loans and leases managed primarily by GCB and Corporate/Other. The following table provides Citi’s consumer loans by loan type: | | | | | | | | | December 31, | In millions of dollars | 2017 | 2016 | In U.S. offices | | | Mortgage and real estate(1) | $ | 65,467 |
| $ | 72,957 |
| Installment, revolving credit and other | 3,398 |
| 3,395 |
| Cards | 139,006 |
| 132,654 |
| Commercial and industrial | 7,840 |
| 7,159 |
| | $ | 215,711 |
| $ | 216,165 |
| In offices outside the U.S. | | | Mortgage and real estate(1) | $ | 44,081 |
| $ | 42,803 |
| Installment, revolving credit and other | 26,556 |
| 24,887 |
| Cards | 26,257 |
| 23,783 |
| Commercial and industrial | 20,238 |
| 16,568 |
| Lease financing | 76 |
| 81 |
| | $ | 117,208 |
| $ | 108,122 |
| Total consumer loans | $ | 332,919 |
| $ | 324,287 |
| Net unearned income | $ | 737 |
| $ | 776 |
| Consumer loans, net of unearned income | $ | 333,656 |
| $ | 325,063 |
|
| | (1) | Loans secured primarily by real estate. |
Citigroup has established a risk management process to monitor, evaluate and manage the principal risks associated with its consumer loan portfolio. Credit quality indicators that are actively monitored include delinquency status, consumer credit scores (FICO) and loan to value (LTV) ratios, each as discussed in more detail below. Included in the loan table above are lending products whose terms may give rise to greater credit issues. Credit cards with below-market introductory interest rates and interest-only loans are examples of such products. These products are closely managed using credit techniques that are intended to mitigate their higher inherent risk. During the years ended December 31, 2017 and 2016, the Company sold and/or reclassified to held-for-sale, $4.9 billion and $9.7 billion, respectively, of consumer loans.
Delinquency Status Delinquency status is monitored and considered a key indicator of credit quality of consumer loans. Principally, the U.S. residential first mortgage loans use the Mortgage Bankers Association (MBA) method of reporting delinquencies, which considers a loan delinquent if a monthly payment has not been received by the end of the day immediately preceding the loan’s next due date. All other loans use a method of reporting delinquencies that considers a loan delinquent if a monthly payment has not been received by the close of business on the loan’s next due date. As a general policy, residential first mortgages, home equity loans and installment loans are classified as non-accrual when loan payments are 90 days contractually past due. Credit cards and unsecured revolving loans generally accrue interest until payments are 180 days past due. Home equity loans in regulated bank entities are classified as non-accrual if the related residential first mortgage is 90 days or more past due. Mortgage loans, other than Federal Housing Administration (FHA)-insured loans, are classified as non-accrual within 60 days of notification that the borrower has filed for bankruptcy. Commercial market loans are placed on a cash (non-accrual) basis when it is determined, based on actual experience and a forward-looking assessment of the collectability of the loan in full, that the payment of interest or principal is doubtful or when interest or principal is 90 days past due. The policy for re-aging modified U.S. consumer loans to current status varies by product. Generally, one of the conditions to qualify for these modifications is that a minimum number of payments (typically ranging from one to three) be made. Upon modification, the loan is re-aged to current status. However, re-aging practices for certain open-ended consumer loans, such as credit cards, are governed by Federal Financial Institutions Examination Council (FFIEC) guidelines. For open-ended consumer loans subject to FFIEC guidelines, one of the conditions for a loan to be re-aged to current status is that at least three consecutive minimum monthly payments, or the equivalent amount, must be received. In addition, under FFIEC guidelines, the number of times that such a loan can be re-aged is subject to limitations (generally once in 12 months and twice in five years). Furthermore, FHA and Department of Veterans Affairs (VA) loans are modified under those respective agencies’ guidelines and payments are not always required in order to re-age a modified loan to current.
Consumer Loan Delinquency and Non-Accrual Details at December 31, 2017 | | | | | | | | | | | | | | | | | | | | | | | In millions of dollars | Total current(1)(2) | 30–89 days past due(3) | ≥ 90 days past due(3) | Past due government guaranteed(4) | Total loans(2) | Total non-accrual | 90 days past due and accruing | In North America offices | | | | | | | | Residential first mortgages(5) | $ | 47,366 |
| $ | 505 |
| $ | 280 |
| $ | 1,225 |
| $ | 49,376 |
| $ | 665 |
| $ | 941 |
| Home equity loans(6)(7) | 14,268 |
| 207 |
| 352 |
| — |
| 14,827 |
| 750 |
| — |
| Credit cards | 136,588 |
| 1,528 |
| 1,613 |
| — |
| 139,729 |
| — |
| 1,596 |
| Installment and other | 3,395 |
| 45 |
| 16 |
| — |
| 3,456 |
| 22 |
| 1 |
| Commercial market loans | 9,395 |
| 51 |
| 65 |
| — |
| 9,511 |
| 213 |
| 15 |
| Total | $ | 211,012 |
| $ | 2,336 |
| $ | 2,326 |
| $ | 1,225 |
| $ | 216,899 |
| $ | 1,650 |
| $ | 2,553 |
| In offices outside North America | | | | | | | | Residential first mortgages(5) | $ | 37,062 |
| $ | 209 |
| $ | 148 |
| $ | — |
| $ | 37,419 |
| $ | 400 |
| $ | — |
| Credit cards | 24,934 |
| 427 |
| 366 |
| — |
| 25,727 |
| 323 |
| 259 |
| Installment and other | 25,634 |
| 275 |
| 123 |
| — |
| 26,032 |
| 157 |
| — |
| Commercial market loans | 27,449 |
| 57 |
| 72 |
| — |
| 27,578 |
| 160 |
| — |
| Total | $ | 115,079 |
| $ | 968 |
| $ | 709 |
| $ | — |
| $ | 116,756 |
| $ | 1,040 |
| $ | 259 |
| Total GCB and Corporate/Other—consumer | $ | 326,091 |
| $ | 3,304 |
| $ | 3,035 |
| $ | 1,225 |
| $ | 333,655 |
| $ | 2,690 |
| $ | 2,812 |
| Other(8) | 1 |
| — |
| — |
| — |
| 1 |
| — |
| — |
| Total Citigroup | $ | 326,092 |
| $ | 3,304 |
| $ | 3,035 |
| $ | 1,225 |
| $ | 333,656 |
| $ | 2,690 |
| $ | 2,812 |
|
| | (1) | Loans less than 30 days past due are presented as current. |
| | (2) | Includes $25 million of residential first mortgages recorded at fair value. |
| | (3) | Excludes loans guaranteed by U.S. government-sponsored entities. |
| | (4) | Consists of residential first mortgages that are guaranteed by U.S. government-sponsored entities that are 30–89 days past due of $0.2 billion and 90 days or more past due of $1.0 billion. |
| | (5) | Includes approximately $0.1 billion of residential first mortgage loans in process of foreclosure. |
| | (6) | Includes approximately $0.1 billion of home equity loans in process of foreclosure. |
| | (7) | Fixed-rate home equity loans and loans extended under home equity lines of credit, which are typically in junior lien positions. |
| | (8) | Represents loans classified as consumer loans on the Consolidated Balance Sheet that are not included in GCB or Corporate/Other consumer credit metrics. |
Consumer Loan Delinquency and Non-Accrual Details at December 31, 2016 | | | | | | | | | | | | | | | | | | | | | | | In millions of dollars | Total current(1)(2) | 30–89 days past due(3) | ≥ 90 days past due(3) | Past due government guaranteed(4) | Total loans(2) | Total non-accrual | 90 days past due and accruing | In North America offices | | | | | | | | Residential first mortgages(5) | $ | 50,766 |
| $ | 522 |
| $ | 371 |
| $ | 1,474 |
| $ | 53,133 |
| $ | 848 |
| $ | 1,227 |
| Home equity loans(6)(7) | 18,767 |
| 249 |
| 438 |
| — |
| 19,454 |
| 914 |
| — |
| Credit cards | 130,327 |
| 1,465 |
| 1,509 |
| — |
| 133,301 |
| — |
| 1,509 |
| Installment and other | 4,486 |
| 106 |
| 38 |
| — |
| 4,630 |
| 70 |
| 2 |
| Commercial market loans | 8,876 |
| 23 |
| 74 |
| — |
| 8,973 |
| 328 |
| 14 |
| Total | $ | 213,222 |
| $ | 2,365 |
| $ | 2,430 |
| $ | 1,474 |
| $ | 219,491 |
| $ | 2,160 |
| $ | 2,752 |
| In offices outside North America | | | | | | | | Residential first mortgages(5) | $ | 35,862 |
| $ | 206 |
| $ | 135 |
| $ | — |
| $ | 36,203 |
| $ | 360 |
| $ | — |
| Credit cards | 22,363 |
| 368 |
| 324 |
| — |
| 23,055 |
| 258 |
| 239 |
| Installment and other | 22,683 |
| 264 |
| 126 |
| — |
| 23,073 |
| 163 |
| — |
| Commercial market loans | 23,054 |
| 72 |
| 112 |
| — |
| 23,238 |
| 217 |
| — |
| Total | $ | 103,962 |
| $ | 910 |
| $ | 697 |
| $ | — |
| $ | 105,569 |
| $ | 998 |
| $ | 239 |
| Total GCB and Corporate/Other—consumer | $ | 317,184 |
| $ | 3,275 |
| $ | 3,127 |
| $ | 1,474 |
| $ | 325,060 |
| $ | 3,158 |
| $ | 2,991 |
| Other(9) | 3 |
| — |
| — |
| — |
| 3 |
| — |
| — |
| Total Citigroup | $ | 317,187 |
| $ | 3,275 |
| $ | 3,127 |
| $ | 1,474 |
| $ | 325,063 |
| $ | 3,158 |
| $ | 2,991 |
|
| | (1) | Loans less than 30 days past due are presented as current. |
| | (2) | Includes $29 million of residential first mortgages recorded at fair value. |
| | (3) | Excludes loans guaranteed by U.S. government-sponsored entities. |
| | (4) | Consists of residential first mortgages that are guaranteed by U.S. government-sponsored entities that are 30–89 days past due of $0.2 billion and 90 days or more past due of $1.3 billion. |
| | (5) | Includes approximately $0.1 billion of residential first mortgage loans in process of foreclosure. |
| | (6) | Includes approximately $0.1 billion of home equity loans in process of foreclosure. |
| | (7) | Fixed-rate home equity loans and loans extended under home equity lines of credit, which are typically in junior lien positions. |
| | (8) | Represents loans classified as consumer loans on the Consolidated Balance Sheet that are not included in the Corporate/Other consumer credit metrics. |
Consumer Credit Scores (FICO) In the U.S., independent credit agencies rate an individual’s risk for assuming debt based on the individual’s credit history and assign every consumer a “FICO” (Fair Isaac Corporation) credit score. These scores are continually updated by the agencies based upon an individual’s credit actions (e.g., taking out a loan or missed or late payments). The following tables provide details on the FICO scores for Citi’s U.S. consumer loan portfolio based on end-of-period receivables (commercial market loans are excluded from the table since they are business based and FICO scores are not a primary driver in their credit evaluation). FICO scores are updated monthly for substantially all of the portfolio or, otherwise, on a quarterly basis for the remaining portfolio.
| | | | | | | | | | | FICO score distribution in U.S. portfolio(1)(2) | December 31, 2017 | In millions of dollars | Less than 620 | ≥ 620 but less than 660 | Equal to or greater than 660 | Residential first mortgages | $ | 2,100 |
| $ | 1,932 |
| $ | 42,265 |
| Home equity loans | 1,379 |
| 1,081 |
| 11,976 |
| Credit cards | 9,079 |
| 11,651 |
| 115,577 |
| Installment and other | 276 |
| 250 |
| 2,485 |
| Total | $ | 12,834 |
| $ | 14,914 |
| $ | 172,303 |
|
| | | | | | | | | | | FICO score distribution in U.S. portfolio(1)(2) | December 31, 2016 |
In millions of dollars | Less than 620 | ≥ 620 but less than 660 | Equal to or greater than 660 | Residential first mortgages | $ | 2,744 |
| $ | 2,422 |
| $ | 44,279 |
| Home equity loans | 1,750 |
| 1,418 |
| 14,743 |
| Credit cards | 8,310 |
| 11,320 |
| 110,522 |
| Installment and other | 284 |
| 271 |
| 2,601 |
| Total | $ | 13,088 |
| $ | 15,431 |
| $ | 172,145 |
|
| | (1) | Excludes loans guaranteed by U.S. government entities, loans subject to long-term standby commitments (LTSCs) with U.S. government-sponsored entities and loans recorded at fair value. |
| | (2) | Excludes balances where FICO was not available. Such amounts are not material. |
Loan to Value (LTV) Ratios LTV ratios (loan balance divided by appraised value) are calculated at origination and updated by applying market price data. The following tables provide details on the LTV ratios for Citi’s U.S. consumer mortgage portfolios. LTV ratios are updated monthly using the most recent Core Logic Home Price Index data available for substantially all of the portfolio applied at the Metropolitan Statistical Area level, if available, or the state level if not. The remainder of the portfolio is updated in a similar manner using the Federal Housing Finance Agency indices. | | | | | | | | | | | LTV distribution in U.S. portfolio(1)(2) | December 31, 2017 | In millions of dollars | Less than or equal to 80% | > 80% but less than or equal to 100% | Greater than 100% | Residential first mortgages | $ | 43,626 |
| $ | 2,578 |
| $ | 247 |
| Home equity loans | 11,403 |
| 2,147 |
| 800 |
| Total | $ | 55,029 |
| $ | 4,725 |
| $ | 1,047 |
|
| | | | | | | | | | | LTV distribution in U.S. portfolio(1)(2) | December 31, 2016 | In millions of dollars | Less than or equal to 80% | > 80% but less than or equal to 100% | Greater than 100% | Residential first mortgages | $ | 45,849 |
| $ | 3,467 |
| $ | 324 |
| Home equity loans | 12,869 |
| 3,653 |
| 1,305 |
| Total | $ | 58,718 |
| $ | 7,120 |
| $ | 1,629 |
|
| | (1) | Excludes loans guaranteed by U.S. government entities, loans subject to LTSCs with U.S. government-sponsored entities and loans recorded at fair value. |
| | (2) | Excludes balances where LTV was not available. Such amounts are not material. |
Impaired Consumer Loans A loan is considered impaired when Citi believes it is probable that all amounts due according to the original contractual terms of the loan will not be collected. Impaired consumer loans include non-accrual commercial market loans, as well as smaller-balance homogeneous loans whose terms have been modified due to the borrower’s financial difficulties and where Citi has granted a concession to the borrower. These modifications may include interest rate reductions and/or principal forgiveness. Impaired consumer loans exclude smaller-balance homogeneous loans that have not been modified and are carried on a non-accrual basis. The following tables present information about impaired consumer loans and interest income recognized on impaired consumer loans:
| | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2017 | In millions of dollars | Recorded investment(1)(2) | Unpaid principal balance | Related specific allowance(3) | Average carrying value(4) | Interest income recognized(5) | Mortgage and real estate | | | | | | Residential first mortgages | $ | 2,877 |
| $ | 3,121 |
| $ | 278 |
| $ | 3,155 |
| $ | 119 |
| Home equity loans | 1,151 |
| 1,590 |
| 216 |
| 1,181 |
| 28 |
| Credit cards | 1,787 |
| 1,819 |
| 614 |
| 1,803 |
| 150 |
| Installment and other | | | | | | Individual installment and other | 431 |
| 460 |
| 175 |
| 415 |
| 25 |
| Commercial market loans | 334 |
| 541 |
| 51 |
| 429 |
| 20 |
| Total | $ | 6,580 |
| $ | 7,531 |
| $ | 1,334 |
| $ | 6,983 |
| $ | 342 |
|
| | (1) | Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount and direct write-downs and includes accrued interest only on credit card loans. |
| | (2) | $607 million of residential first mortgages, $370 million of home equity loans and $10 million of commercial market loans do not have a specific allowance. |
(3) Included in the Allowance for loan losses. (4) Average carrying value represents the average recorded investment ending balance for the last four quarters and does not include the related specific allowance. (5) Includes amounts recognized on both an accrual and cash basis.
| | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2016 | In millions of dollars | Recorded investment(1)(2) | Unpaid principal balance | Related specific allowance(3) | Average carrying value(4) | Interest income recognized(5)(6) | Mortgage and real estate | | | | |
| Residential first mortgages | $ | 3,786 |
| $ | 4,157 |
| $ | 540 |
| $ | 4,632 |
| $ | 170 |
| Home equity loans | 1,298 |
| 1,824 |
| 189 |
| 1,326 |
| 35 |
| Credit cards | 1,747 |
| 1,781 |
| 566 |
| 1,831 |
| 158 |
| Installment and other | | | | | | Individual installment and other | 455 |
| 481 |
| 215 |
| 475 |
| 27 |
| Commercial market loans | 513 |
| 744 |
| 98 |
| 538 |
| 12 |
| Total | $ | 7,799 |
| $ | 8,987 |
| $ | 1,608 |
| $ | 8,802 |
| $ | 402 |
|
| | (1) | Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount and direct write-downs and includes accrued interest only on credit card loans. |
| | (2) | $740 million of residential first mortgages, $406 million of home equity loans and $97 million of commercial market loans do not have a specific allowance. |
| | (3) | Included in the Allowance for loan losses. |
| | (4) | Average carrying value represents the average recorded investment ending balance for the last four quarters and does not include the related specific allowance. |
(5) Includes amounts recognized on both an accrual and cash basis. (6) Interest income recognized for the year ended December 31, 2015 was $728 million.
Consumer Troubled Debt Restructurings
| | | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2017 | In millions of dollars except number of loans modified | Number of loans modified | Post- modification recorded investment(1)(2) | Deferred principal(3) | Contingent principal forgiveness(4) | Principal forgiveness(5) | Average interest rate reduction | North America | | | | | | | Residential first mortgages | 4,063 |
| $ | 580 |
| $ | 6 |
| $ | — |
| $ | 2 |
| 1 | % | Home equity loans | 2,807 |
| 247 |
| 16 |
| — |
| 1 |
| 1 |
| Credit cards | 230,042 |
| 880 |
| — |
| — |
| — |
| 17 |
| Installment and other revolving | 1,088 |
| 8 |
| — |
| — |
| — |
| 5 |
| Commercial banking(6) | 112 |
| 117 |
| — |
| — |
| — |
| — |
| Total(8) | 238,112 |
| $ | 1,832 |
| $ | 22 |
| $ | — |
| $ | 3 |
| | International | | | | | | | Residential first mortgages | 4,477 |
| $ | 123 |
| $ | — |
| $ | — |
| $ | — |
| — | % | Credit cards | 115,941 |
| 399 |
| — |
| — |
| 7 |
| 11 |
| Installment and other revolving | 44,880 |
| 254 |
| — |
| — |
| 11 |
| 9 |
| Commercial banking(6) | 370 |
| 50 |
| — |
| — |
| — |
| — |
| Total(8) | 165,668 |
| $ | 826 |
| $ | — |
| $ | — |
| $ | 18 |
| |
|
| | | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2016 | In millions of dollars except number of loans modified | Number of loans modified | Post- modification recorded investment(1)(7) | Deferred principal(3) | Contingent principal forgiveness(4) | Principal forgiveness(5) | Average interest rate reduction | North America | | | | | | | Residential first mortgages | 5,023 |
| $ | 726 |
| $ | 6 |
| $ | — |
| $ | 3 |
| 1 | % | Home equity loans | 4,100 |
| 200 |
| 6 |
| — |
| 1 |
| 2 |
| Credit cards | 196,004 |
| 762 |
| — |
| — |
| — |
| 17 |
| Installment and other revolving | 5,649 |
| 47 |
| — |
| — |
| — |
| 14 |
| Commercial banking(6) | 132 |
| 91 |
| — |
| — |
| — |
| — |
| Total(8) | 210,908 |
| $ | 1,826 |
| $ | 12 |
| $ | — |
| $ | 4 |
| | International | | | | | | | Residential first mortgages | 2,722 |
| $ | 80 |
| $ | — |
| $ | — |
| $ | — |
| — | % | Credit cards | 137,466 |
| 385 |
| — |
| — |
| 9 |
| 12 |
| Installment and other revolving | 60,094 |
| 276 |
| — |
| — |
| 7 |
| 7 |
| Commercial banking(6) | 162 |
| 109 |
| — |
| — |
| — |
| — |
| Total(8) | 200,444 |
| $ | 850 |
| $ | — |
| $ | — |
| $ | 16 |
| |
| | (1) | Post-modification balances include past due amounts that are capitalized at the modification date. |
| | (2) | Post-modification balances in North America include $53 million of residential first mortgages and $21 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the year ended December 31, 2017. These amounts include $36 million of residential first mortgages and $18 million of home equity loans that were newly classified as TDRs during 2017, based on previously received OCC guidance. |
| | (3) | Represents portion of contractual loan principal that is non-interest bearing, but still due from the borrower. Such deferred principal is charged off at the time of permanent modification to the extent that the related loan balance exceeds the underlying collateral value. |
| | (4) | Represents portion of contractual loan principal that is non-interest bearing and, depending upon borrower performance, eligible for forgiveness. |
| | (5) | Represents portion of contractual loan principal that was forgiven at the time of permanent modification. |
(6) Commercial banking loans are generally borrower-specific modifications and incorporate changes in the amount and/or timing of principal and/or interest. (7) Post-modification balances in North America include $74 million of residential first mortgages and $22 million of home equity loans to borrowers who have gone through Chapter 7 bankruptcy in the year ended December 31, 2016. These amounts include $48 million of residential first mortgages and $20 million of home equity loans that were newly classified as TDRs during 2016, based on previously received OCC guidance. (8) The above tables reflect activity for loans outstanding as of the end of the reporting period that were considered TDRs.
The following table presents consumer TDRs that defaulted, for which the payment default occurred within one year of a permanent modification. Default is defined as 60 days past due, except for classifiably managed commercial banking loans, where default is defined as 90 days past due. | | | | | | | | In millions of dollars | 2017 | 2016 | North America | | | Residential first mortgages | $ | 253 |
| $ | 229 |
| Home equity loans | 46 |
| 25 |
| Credit cards | 221 |
| 188 |
| Installment and other revolving | 2 |
| 9 |
| Commercial banking | 2 |
| 15 |
| Total | $ | 524 |
| $ | 466 |
| International | | | Residential first mortgages | $ | 11 |
| $ | 11 |
| Credit cards | 185 |
| 148 |
| Installment and other revolving | 96 |
| 90 |
| Commercial banking | 1 |
| 37 |
| Total | $ | 293 |
| $ | 286 |
|
Corporate Loans Corporate loans represent loans and leases managed by ICG. The following table presents information by corporate loan type: | | | | | | | | In millions of dollars | December 31, 2017 | December 31, 2016 | In U.S. offices | | | Commercial and industrial | $ | 51,319 |
| $ | 49,586 |
| Financial institutions | 39,128 |
| 35,517 |
| Mortgage and real estate(1) | 44,683 |
| 38,691 |
| Installment, revolving credit and other | 33,181 |
| 34,501 |
| Lease financing | 1,470 |
| 1,518 |
| | $ | 169,781 |
| $ | 159,813 |
| In offices outside the U.S. | | | Commercial and industrial | $ | 93,750 |
| $ | 81,882 |
| Financial institutions | 35,273 |
| 26,886 |
| Mortgage and real estate(1) | 7,309 |
| 5,363 |
| Installment, revolving credit and other | 22,638 |
| 19,965 |
| Lease financing | 190 |
| 251 |
| Governments and official institutions | 5,200 |
| 5,850 |
| | $ | 164,360 |
| $ | 140,197 |
| Total corporate loans | $ | 334,141 |
| $ | 300,010 |
| Net unearned income | $ | (763 | ) | $ | (704 | ) | Corporate loans, net of unearned income | $ | 333,378 |
| $ | 299,306 |
|
| | (1) | Loans secured primarily by real estate. |
The Company sold and/or reclassified to held-for-sale $1.0 billion and $4.2 billion of corporate loans during the years ended December 31, 2017 and 2016, respectively. The Company did not have significant purchases of corporate loans classified as held-for-investment for the years ended December 31, 2017 or 2016.
Delinquency Status Citi generally does not manage corporate loans on a delinquency basis. Corporate loans are identified as impaired and placed on a cash (non-accrual) basis when it is determined, based on actual experience and a forward-looking assessment of the collectability of the loan in full, that the payment of interest or principal is doubtful or when interest or principal is 90 days past due, except when the loan is well collateralized and in the process of collection. Any interest accrued on impaired corporate loans and leases is reversed at 90 days and charged against current earnings, and interest is thereafter included in earnings only to the extent actually received in cash. When there is doubt regarding the ultimate collectability of principal, all cash receipts are thereafter applied to reduce the recorded investment in the loan. While corporate loans are generally managed based on their internally assigned risk rating (see further discussion below), the following tables present delinquency information by corporate loan type. Corporate Loan Delinquency and Non-Accrual Details at December 31, 2017 | | | | | | | | | | | | | | | | | | | | In millions of dollars | 30–89 days past due and accruing(1) | ≥ 90 days past due and accruing(1) | Total past due and accruing | Total non-accrual(2) | Total current(3) | Total loans (4) | Commercial and industrial | $ | 249 |
| $ | 13 |
| $ | 262 |
| $ | 1,506 |
| $ | 139,554 |
| $ | 141,322 |
| Financial institutions | 93 |
| 15 |
| 108 |
| 92 |
| 73,557 |
| 73,757 |
| Mortgage and real estate | 147 |
| 59 |
| 206 |
| 195 |
| 51,563 |
| 51,964 |
| Leases | 68 |
| 8 |
| 76 |
| 46 |
| 1,533 |
| 1,655 |
| Other | 70 |
| 13 |
| 83 |
| 103 |
| 60,145 |
| 60,331 |
| Loans at fair value |
|
|
|
|
|
|
|
|
|
| 4,349 |
| Total | $ | 627 |
| $ | 108 |
| $ | 735 |
| $ | 1,942 |
| $ | 326,352 |
| $ | 333,378 |
|
Corporate Loan Delinquency and Non-Accrual Details at December 31, 2016 | | | | | | | | | | | | | | | | | | | | In millions of dollars | 30–89 days past due and accruing(1) | ≥ 90 days past due and accruing(1) | Total past due and accruing | Total non-accrual(2) | Total current(3) | Total loans (4) | Commercial and industrial | $ | 143 |
| $ | 52 |
| $ | 195 |
| $ | 1,909 |
| $ | 127,012 |
| $ | 129,116 |
| Financial institutions | 119 |
| 2 |
| 121 |
| 185 |
| 61,254 |
| 61,560 |
| Mortgage and real estate | 148 |
| 137 |
| 285 |
| 139 |
| 43,607 |
| 44,031 |
| Leases | 27 |
| 8 |
| 35 |
| 56 |
| 1,678 |
| 1,769 |
| Other | 349 |
| 12 |
| 361 |
| 132 |
| 58,880 |
| 59,373 |
| Loans at fair value |
|
|
|
|
|
|
|
|
|
| 3,457 |
| Total | $ | 786 |
| $ | 211 |
| $ | 997 |
| $ | 2,421 |
| $ | 292,431 |
| $ | 299,306 |
|
| | (1) | Corporate loans that are 90 days past due are generally classified as non-accrual. Corporate loans are considered past due when principal or interest is contractually due but unpaid. |
| | (2) | Non-accrual loans generally include those loans that are ≥ 90 days past due or those loans for which Citi believes, based on actual experience and a forward-looking assessment of the collectability of the loan in full, that the payment of interest or principal is doubtful. |
| | (3) | Loans less than 30 days past due are presented as current. |
| | (4) | Total loans include loans at fair value, which are not included in the various delinquency columns. |
Citigroup has a risk management process to monitor, evaluate and manage the principal risks associated with its corporate loan portfolio. As part of its risk management process, Citi assigns numeric risk ratings to its corporate loan facilities based on quantitative and qualitative assessments of the obligor and facility. These risk ratings are reviewed at least annually or more often if material events related to the obligor or facility warrant. Factors considered in assigning the risk ratings include financial condition of the obligor, qualitative assessment of management and strategy, amount and sources of repayment, amount and type of collateral and guarantee arrangements, amount and type of any contingencies associated with the obligor and the obligor’s industry and geography. The obligor risk ratings are defined by ranges of default probabilities. The facility risk ratings are defined by ranges of loss norms, which are the product of the probability of default and the loss given default. The investment grade rating categories are similar to the category BBB-/Baa3 and above as defined by S&P and Moody’s. Loans classified according to the bank regulatory definitions as special mention, substandard and doubtful will have risk ratings within the non-investment grade categories.
Corporate Loans Credit Quality Indicators | | | | | | | | | Recorded investment in loans(1) | In millions of dollars | December 31, 2017 | December 31, 2016 | Investment grade(2) | | | Commercial and industrial | $ | 101,313 |
| $ | 87,201 |
| Financial institutions | 60,404 |
| 50,597 |
| Mortgage and real estate | 23,213 |
| 18,718 |
| Leases | 1,090 |
| 1,303 |
| Other | 56,306 |
| 52,828 |
| Total investment grade | $ | 242,326 |
| $ | 210,647 |
| Non-investment grade(2) | | | Accrual | | | Commercial and industrial | $ | 38,503 |
| $ | 39,874 |
| Financial institutions | 13,261 |
| 10,873 |
| Mortgage and real estate | 2,881 |
| 1,821 |
| Leases | 518 |
| 410 |
| Other | 3,924 |
| 6,450 |
| Non-accrual | | | Commercial and industrial | 1,506 |
| 1,909 |
| Financial institutions | 92 |
| 185 |
| Mortgage and real estate | 195 |
| 139 |
| Leases | 46 |
| 56 |
| Other | 103 |
| 132 |
| Total non-investment grade | $ | 61,029 |
| $ | 61,849 |
| Private bank loans managed on a delinquency basis(2) | $ | 25,674 |
| $ | 23,353 |
| Loans at fair value | 4,349 |
| 3,457 |
| Corporate loans, net of unearned income | $ | 333,378 |
| $ | 299,306 |
|
| | (1) | Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount, less any direct write-downs. |
| | (2) | Held-for-investment loans are accounted for on an amortized cost basis. |
Impaired collateral-dependent loans and leases, where repayment is expected to be provided solely by the sale of the underlying collateral and there are no other available and reliable sources of repayment, are written down to the lower of cost or collateral value, less cost to sell. Cash-basis loans are returned to an accrual status when all contractual principal and interest amounts are reasonably assured of repayment and there is a sustained period of repayment performance, generally six months, in accordance with the contractual terms of the loan. The following tables present non-accrual loan information by corporate loan type and interest income recognized on non-accrual corporate loans: Non-Accrual Corporate Loans | | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2017 | In millions of dollars | Recorded investment(1) | Unpaid principal balance | Related specific allowance | Average carrying value(2) | Interest income recognized(3) | Non-accrual corporate loans | | | | | | Commercial and industrial | $ | 1,506 |
| $ | 1,775 |
| $ | 368 |
| $ | 1,547 |
| $ | 23 |
| Financial institutions | 92 |
| 102 |
| 41 |
| 212 |
| 1 |
| Mortgage and real estate | 195 |
| 324 |
| 11 |
| 183 |
| 10 |
| Lease financing | 46 |
| 46 |
| 4 |
| 59 |
| — |
| Other | 103 |
| 212 |
| 2 |
| 108 |
| 1 |
| Total non-accrual corporate loans | $ | 1,942 |
| $ | 2,459 |
| $ | 426 |
| $ | 2,109 |
| $ | 35 |
|
| | | | | | | | | | | | | | | | | | At and for the year ended December 31, 2016 | In millions of dollars | Recorded investment(1) | Unpaid principal balance | Related specific allowance | Average carrying value(2) | Interest income recognized(3) | Non-accrual corporate loans | | | | | | Commercial and industrial | $ | 1,909 |
| $ | 2,259 |
| $ | 362 |
| $ | 1,919 |
| $ | 25 |
| Financial institutions | 185 |
| 192 |
| 16 |
| 183 |
| 3 |
| Mortgage and real estate | 139 |
| 250 |
| 10 |
| 174 |
| 6 |
| Lease financing | 56 |
| 56 |
| 4 |
| 44 |
| — |
| Other | 132 |
| 197 |
| — |
| 87 |
| 6 |
| Total non-accrual corporate loans | $ | 2,421 |
| $ | 2,954 |
| $ | 392 |
| $ | 2,407 |
| $ | 40 |
|
| | | | | | | | | | | | | | | December 31, 2017 | December 31, 2016 | In millions of dollars | Recorded investment(1) | Related specific allowance | Recorded investment(1) | Related specific allowance | Non-accrual corporate loans with valuation allowances | | | | | Commercial and industrial | $ | 1,017 |
| $ | 368 |
| $ | 1,343 |
| $ | 362 |
| Financial institutions | 88 |
| 41 |
| 45 |
| 16 |
| Mortgage and real estate | 51 |
| 11 |
| 41 |
| 10 |
| Lease financing | 46 |
| 4 |
| 55 |
| 4 |
| Other | 13 |
| 2 |
| 1 |
| — |
| Total non-accrual corporate loans with specific allowance | $ | 1,215 |
| $ | 426 |
| $ | 1,485 |
| $ | 392 |
| Non-accrual corporate loans without specific allowance | | | | | Commercial and industrial | $ | 489 |
| |
| $ | 566 |
| |
| Financial institutions | 4 |
| |
| 140 |
| |
| Mortgage and real estate | 144 |
| |
| 98 |
| |
| Lease financing | — |
| |
| 1 |
| |
| Other | 90 |
| |
| 131 |
| |
| Total non-accrual corporate loans without specific allowance | $ | 727 |
| N/A |
| $ | 936 |
| N/A |
|
| | (1) | Recorded investment in a loan includes net deferred loan fees and costs, unamortized premium or discount, less any direct write-downs. |
| | (2) | Average carrying value represents the average recorded investment balance and does not include related specific allowance. |
| | (3) | Interest income recognized for the year ended December 31, 2015 was $11 million. |
N/A Not applicable
Corporate Troubled Debt Restructurings
The following table presents corporate TDR activity at and for the year ended December 31, 2017: | | | | | | | | | | | | | | In millions of dollars | Carrying Value | TDRs involving changes in the amount and/or timing of principal payments(1) | TDRs involving changes in the amount and/or timing of interest payments(2) | TDRs involving changes in the amount and/or timing of both principal and interest payments | Commercial and industrial | $ | 509 |
| $ | 131 |
| $ | 7 |
| $ | 371 |
| Financial institutions | 15 |
| — |
| — |
| 15 |
| Mortgage and real estate | 36 |
| — |
| — |
| 36 |
| Total | $ | 560 |
| $ | 131 |
| $ | 7 |
| $ | 422 |
|
The following table presents corporate TDR activity at and for the year ended December 31, 2016: | | | | | | | | | | | | | | In millions of dollars | Carrying Value | TDRs involving changes in the amount and/or timing of principal payments(1) | TDRs involving changes in the amount and/or timing of interest payments(2) | TDRs involving changes in the amount and/or timing of both principal and interest payments | Commercial and industrial | $ | 338 |
| $ | 176 |
| $ | 34 |
| $ | 128 |
| Financial institutions | 10 |
| 10 |
| — |
| — |
| Mortgage and real estate | 15 |
| 6 |
| — |
| 9 |
| Other | 142 |
| — |
| 142 |
| — |
| Total | $ | 505 |
| $ | 192 |
| $ | 176 |
| $ | 137 |
|
| | (1) | TDRs involving changes in the amount or timing of principal payments may involve principal forgiveness or deferral of periodic and/or final principal payments. Because forgiveness of principal is rare for corporate loans, modifications typically have little to no impact on the loans’ projected cash flows and thus little to no impact on the allowance established for the loans. Charge-offs for amounts deemed uncollectable may be recorded at the time of the restructuring or may have already been recorded in prior periods such that no charge-off is required at the time of the modification. |
| | (2) | TDRs involving changes in the amount or timing of interest payments may involve a below-market interest rate. |
The following table presents total corporate loans modified in a TDR as well as those TDRs that defaulted and for which the payment default occurred within one year of a permanent modification. Default is defined as 60 days past due, except for classifiably managed commercial banking loans, where default is defined as 90 days past due. | | | | | | | | | | | | | | In millions of dollars | TDR balances at December 31, 2017 | TDR loans in payment default during the year ended December 31, 2017 | TDR balances at December 31, 2016 | TDR loans in payment default during the year ended December 31, 2016 | Commercial and industrial | $ | 617 |
| $ | 72 |
| $ | 408 |
| $ | 7 |
| Financial institutions | 48 |
| — |
| 9 |
| — |
| Mortgage and real estate | 101 |
| — |
| 87 |
| 8 |
| Lease financing | 7 |
| — |
| — |
| — |
| Other | 45 |
| — |
| 228 |
| — |
| Total(1) | $ | 818 |
| $ | 72 |
| $ | 732 |
| $ | 15 |
|
| | (1) | The above tables reflect activity for loans outstanding as of the end of the reporting period that were considered TDRs. |
|