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Allowance for Credit Losses (Tables)
 12 Months Ended
Dec. 31, 2016
Receivables [Abstract]  
Summary of Changes in the Allowance for Credit Losses and the Related Loan Balance by Product
The following table summarizes the changes in the allowance for credit losses by product and the related loan balance by product during the years ended December 31, 2016, 2015 and 2014:
 
Commercial
 
Consumer
 
 
 
Construction
and Other
Real Estate
 
Business
and Corporate Banking(1)
 
Global
Banking(1)
 
Other
Comm'l
 
Residential
Mortgages
 
Home
Equity
Mortgages
 
Credit
Cards
 
Other
Consumer
 
Total
 
(in millions)
Year Ended December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses – beginning of period
$
86

 
$
407

 
$
267

 
$
19

 
$
68

 
$
24

 
$
32

 
$
9

 
$
912

Provision charged (credited) to income(2)
—

 
10

 
348

 
(6
)
 
(9
)
 
(1
)
 
26

 
4

 
372

Charge-offs(2)(3)
(1
)
 
(110
)
 
(107
)
 
—

 
(45
)
 
(8
)
 
(30
)
 
(8
)
 
(309
)
Recoveries
7

 
10

 
—

 
—

 
12

 
5

 
6

 
2

 
42

Net (charge-offs) recoveries
6

 
(100
)
 
(107
)
 
—

 
(33
)
 
(3
)
 
(24
)
 
(6
)
 
(267
)
Allowance for credit losses – end of period
$
92

 
$
317

 
$
508

 
$
13

 
$
26

 
$
20

 
$
34

 
$
7

 
$
1,017

Ending balance: collectively evaluated for impairment
$
91

 
$
262

 
$
257

 
$
12

 
$
17

 
$
19

 
$
33

 
$
7

 
$
698

Ending balance: individually evaluated for impairment
1

 
55

 
251

 
1

 
9

 
1

 
1

 
—

 
319

Total allowance for credit losses
$
92

 
$
317

 
$
508

 
$
13

 
$
26

 
$
20

 
$
34

 
$
7

 
$
1,017

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collectively evaluated for impairment(4)
$
10,847

 
$
13,738

 
$
26,094

 
$
2,484

 
$
16,165

 
$
1,335

 
$
683

 
$
382

 
$
71,728

Individually evaluated for impairment(5)
43

 
342

 
661

 
7

 
60

 
3

 
5

 
—

 
1,121

Loans carried at lower of amortized cost or fair value less cost to sell
—

 
—

 
—

 
—

 
956

 
70

 
—

 
—

 
1,026

Total loans
$
10,890

 
$
14,080

 
$
26,755

 
$
2,491

 
$
17,181

 
$
1,408

 
$
688

 
$
382

 
$
73,875

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Year Ended December 31, 2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses – beginning of period
$
89

 
$
251

 
$
131

 
$
21

 
$
107

 
$
32

 
$
39

 
$
10

 
$
680

Provision charged (credited) to income
2

 
215

 
136

 
(2
)
 
(15
)
 
(4
)
 
20

 
9

 
361

Charge-offs
(10
)
 
(69
)
 
—

 
(1
)
 
(35
)
 
(8
)
 
(32
)
 
(12
)
 
(167
)
Recoveries
5

 
10

 
—

 
1

 
11

 
4

 
5

 
2

 
38

Net (charge-offs) recoveries
(5
)
 
(59
)
 
—

 
—

 
(24
)
 
(4
)
 
(27
)
 
(10
)
 
(129
)
Allowance for credit losses – end of period
$
86

 
$
407

 
$
267

 
$
19

 
$
68

 
$
24

 
$
32

 
$
9

 
$
912

Ending balance: collectively evaluated for impairment
$
85

 
$
355

 
$
267

 
$
18

 
$
35

 
$
23

 
$
31

 
$
9

 
$
823

Ending balance: individually evaluated for impairment
1

 
52

 
—

 
1

 
33

 
1

 
1

 
—

 
89

Total allowance for credit losses
$
86

 
$
407

 
$
267

 
$
19

 
$
68

 
$
24

 
$
32

 
$
9

 
$
912

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collectively evaluated for impairment(4)
$
9,890

 
$
14,148

 
$
34,601

 
$
3,361

 
$
16,112

 
$
1,523

 
$
694

 
$
407

 
$
80,736

Individually evaluated for impairment(5)
110

 
217

 
119

 
7

 
197

 
5

 
5

 
—

 
660

Loans carried at lower of amortized cost or fair value less cost to sell
—

 
—

 
—

 
—

 
1,449

 
72

 
—

 
—

 
1,521

Total loans
$
10,000

 
$
14,365

 
$
34,720

 
$
3,368

 
$
17,758

 
$
1,600

 
$
699

 
$
407

 
$
82,917

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial
 
Consumer
 
 
 
Construction
and Other
Real Estate
 
Business
and Corporate Banking(1)
 
Global
Banking(1)
 
Other
Comm'l
 
Residential
Mortgages
 
Home
Equity
Mortgages
 
Credit
Cards
 
Other
Consumer
 
Total
 
(in millions)
Year Ended December 31, 2014
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allowance for credit losses – beginning of period
$
108

 
$
105

 
$
75

 
$
20

 
$
186

 
$
49

 
$
50

 
$
13

 
$
606

Provision charged (credited) to income
2

 
157

 
64

 
(7
)
 
(40
)
 
(14
)
 
23

 
3

 
188

Charge-offs
(24
)
 
(19
)
 
(8
)
 
(1
)
 
(55
)
 
(13
)
 
(41
)
 
(8
)
 
(169
)
Recoveries
3

 
8

 
—

 
9

 
16

 
10

 
7

 
2

 
55

Net (charge-offs) recoveries
(21
)
 
(11
)
 
(8
)
 
8

 
(39
)
 
(3
)
 
(34
)
 
(6
)
 
$
(114
)
Allowance for credit losses – end of period
$
89

 
$
251

 
$
131

 
$
21

 
$
107

 
$
32

 
$
39

 
$
10

 
$
680

Ending balance: collectively evaluated for impairment
$
84

 
$
227

 
$
131

 
$
20

 
$
64

 
$
30

 
$
37

 
$
10

 
$
603

Ending balance: individually evaluated for impairment
5

 
24

 
—

 
1

 
43

 
2

 
2

 
—

 
77

Total allowance for credit losses
$
89

 
$
251

 
$
131

 
$
21

 
$
107

 
$
32

 
$
39

 
$
10

 
$
680

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Collectively evaluated for impairment(4)
$
10,103

 
$
13,788

 
$
30,328

 
$
3,573

 
$
14,926

 
$
1,709

 
$
714

 
$
489

 
$
75,630

Individually evaluated for impairment(5)
197

 
90

 
—

 
8

 
224

 
5

 
6

 
—

 
530

Loans carried at lower of amortized cost or fair value less cost to sell
—

 
—

 
—

 
—

 
1,511

 
70

 
—

 
—

 
1,581

Total loans
$
10,300

 
$
13,878

 
$
30,328

 
$
3,581

 
$
16,661

 
$
1,784

 
$
720

 
$
489

 
$
77,741

 
(1) 
During the fourth quarter of 2016, we transferred certain customer relationships from CMB to GB&M as discussed further in Note 22, "Business Segments," in the accompanying consolidated financial statements. As a result, we reclassified $4.8 billion, $3.9 billion and $3.4 billion of loans and $27 million, $24 million and $7 million of allowance for credit losses from business and corporate banking to global banking at December 31, 2015, 2014 and 2013, respectively, to conform with the current year presentation.
(2) 
The provision for credit losses and charge-offs for residential mortgage loans during 2016 includes $11 million related to the lower of amortized cost or fair value adjustment attributable to credit factors for loans transferred to held for sale. See Note 7, "Loans Held for Sale," for additional information.
(3) 
For collateral dependent loans that are transferred to held for sale, the existing allowance for credit losses at the time of transfer are recognized as a charge-off. We transferred to held for sale certain residential mortgage loans during 2016 and, accordingly, we recognized the existing allowance for credit losses on these loans as additional charge-offs totaling $22 million during 2016.
(4) 
Global banking includes loans to HSBC affiliates totaling $3,274 million, $4,815 million and 4,821 million at December 31, 2016, 2015 and 2014, respectively, for which we do not carry an associated allowance for credit losses.
(5) 
For consumer loans and certain small business loans, these amounts represent TDR Loans for which we evaluate reserves using a discounted cash flow methodology. Each loan is individually identified as a TDR Loan and then grouped together with other TDR Loans with similar characteristics. The discounted cash flow analysis is then applied to these groups of TDR Loans. Loans individually evaluated for impairment exclude TDR Loans that are carried at the lower of amortized cost or fair value of the collateral less cost to sell which totaled $672 million, $881 million and $763 million at December 31, 2016, 2015 and 2014, respectively.