Allowance for Credit Losses (Tables)

12 Months Ended

Dec. 31, 2020

Weighted Average of Forecasted Key Macroeconomic Variables Used in Estimating Lifetime ECL

The following table presents the forecasted key macroeconomic variables in our Central scenarios used for estimating lifetime ECL at December 31, 2020 and January 1, 2020:


	For the Quarter Ended
	June 30, 2021			December 31, 2021
Unemployment rate (quarterly average):
Forecast at December 31, 2020	6.8	%		6.2	%
Forecast at January 1, 2020	3.9			4.0
GDP growth rate (year-over-year):
Forecast at December 31, 2020	9.2		(1)	5.3
Forecast at January 1, 2020	1.9			2.0

(1)Represents the change in forecasted GDP for the quarter ended June 30, 2021 relative to the GDP for the quarter ended June 30, 2020. The GDP year-over-year growth rate for the quarter ended June 30, 2020 was a decline of 9.0 percent.

Summary of Allowance for Credit Losses and Liability for Off-balance Sheet Credit Exposures

The following table summarizes our allowance for credit losses and the liability for off-balance sheet credit exposures:


	December 31, 2020		January 1, 2020		December 31, 2019
	(in millions)
Allowance for credit losses:
Loans	$	1,015	$	467	$	637
Securities held-to-maturity(1)	2		2		—
Other financial assets measured at amortized cost(2)	2		3		—
Securities available-for-sale(1)	1		3		—
Total allowance for credit losses	$	1,020	$	475	$	637

Liability for off-balance sheet credit exposures	$	237	$	158	$	104

(1)See Note 5, "Securities," for additional information regarding the allowance for credit losses associated with our security portfolios.

(2)Primarily includes accrued interest receivables and customer acceptances.

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 on loans by product or line of business during the years ended December 31, 2020, 2019 and 2018:


	Commercial Loans								Consumer Loans
	Real Estate, including Construction		Business and Corporate Banking		Global Banking		Other Comm'l		Residential Mortgages		Home Equity Mortgages		Credit Cards		Other Consumer		Total Loans
	(in millions)


















Year Ended December 31, 2020
Allowance for credit losses – beginning of period	$	153	$	239	$	106	$	9	$	12	$	6	$	105	$	7	$	637
Cumulative effect adjustment to initially apply new accounting guidance for measuring credit losses	(112)		(60)		51		(5)		(86)		7		32		3		(170)
Allowance for credit losses – beginning of period, adjusted	41		179		157		4		(74)		13		137		10		467
Provision charged (credited) to income	116		274		149		2		55		6		107		27		736
Charge-offs	(12)		(90)		(20)		—		(2)		(3)		(90)		(11)		(228)
Recoveries	—		12		1		1		12		6		7		1		40
Net (charge-offs) recoveries	(12)		(78)		(19)		1		10		3		(83)		(10)		(188)

Allowance for credit losses – end of period	$	145	$	375	$	287	$	7	$	(9)	$	22	$	161	$	27	$	1,015

Year Ended December 31, 2019
Allowance for credit losses – beginning of period	$	116	$	219	$	108	$	15	$	13	$	7	$	58	$	5	$	541
Provision charged (credited) to income	37		62		1		(6)		(3)		(2)		101		5		195
Charge-offs	—		(45)		(3)		—		(8)		(4)		(60)		(5)		(125)
Recoveries	—		3		—		—		10		5		6		2		26
Net (charge-offs) recoveries	—		(42)		(3)		—		2		1		(54)		(3)		(99)

Allowance for credit losses – end of period	$	153	$	239	$	106	$	9	$	12	$	6	$	105	$	7	$	637










Year Ended December 31, 2018
Allowance for credit losses – beginning of period	$	82	$	244	$	264	$	18	$	25	$	11	$	32	$	5	$	681
Provision charged (credited) to income	34		(31)		(109)		(3)		(18)		(3)		55		2		(73)
Charge-offs	—		(41)		(48)		—		(7)		(7)		(35)		(4)		(142)
Recoveries	—		47		1		—		13		6		6		2		75
Net (charge-offs) recoveries	—		6		(47)		—		6		(1)		(29)		(2)		$	(67)

Allowance for credit losses – end of period	$	116	$	219	$	108	$	15	$	13	$	7	$	58	$	5	$	541

Summary of Changes in the Liability for Off-balance Sheet Credit Exposures

The following table summarizes the changes in the liability for off-balance sheet credit exposures during the years ended December 31, 2020, 2019 and 2018:



Year Ended December 31,	2020		2019		2018
	(in millions)
Balance at beginning of period	$	104	$	96	$	106
Cumulative effect adjustment to initially apply new accounting guidance for measuring credit losses	54		—		—
Balance at beginning of period, adjusted	158		96		106
Provision charged (credited) to income	79		8		(10)
Balance at end of period	$	237	$	104	$	96

Summary of Accrued Interest Receivables

The following table summarizes accrued interest receivables associated with financial assets carried at amortized cost and securities available-for-sale along with the related allowance for credit losses, which are reported net in other assets on the consolidated balance sheet. These accrued interest receivables are excluded from the amortized cost basis disclosures presented elsewhere in these financial statements, including Note 5, "Securities," and Note 6, "Loans."


	December 31, 2020
	(in millions)
Accrued interest receivables:
Loans	$	140
Securities held-to-maturity	23
Other financial assets measured at amortized cost	1
Securities available-for-sale	100
Total accrued interest receivables	264
Allowance for credit losses	2
Accrued interest receivables, net	$	262