Allowance for Credit Losses (Tables)

3 Months Ended

Mar. 31, 2021

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 March 31, 2021 and December 31, 2020:


	For the Quarter Ended
	June 30, 2021			December 31, 2021		June 30, 2022		December 31, 2022
Unemployment rate (quarterly average):
Forecast at March 31, 2021	6.0	%		5.5	%	4.9	%	4.4	%
Forecast at December 31, 2020	6.8			6.2		5.9		5.4
GDP growth rate (year-over-year):
Forecast at March 31, 2021	11.0		(1)	4.3		3.7		3.0
Forecast at December 31, 2020	9.2		(1)	5.3		3.1		1.8

(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:


	March 31, 2021		December 31, 2020
	(in millions)
Allowance for credit losses:
Loans	$	853	$	1,015
Securities held-to-maturity(1)	2		2
Other financial assets measured at amortized cost(2)	2		2
Securities available-for-sale(1)	1		1
Total allowance for credit losses	$	858	$	1,020

Liability for off-balance sheet credit exposures	$	155	$	237

(1)See Note 4, "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 three months ended March 31, 2021 and 2020:


	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)


















Three Months Ended March 31, 2021
Allowance for credit losses – beginning of period	$	145	$	375	$	287	$	7	$	(9)	$	22	$	161	$	27	$	1,015


Provision charged (credited) to income	(25)		(53)		(65)		—		(2)		(3)		(1)		4		(145)
Charge-offs	—		(2)		—		—		(1)		—		(18)		(4)		(25)
Recoveries	—		1		—		—		3		2		2		—		8
Net (charge-offs) recoveries	—		(1)		—		—		2		2		(16)		(4)		(17)

Allowance for credit losses – end of period	$	120	$	321	$	222	$	7	$	(9)	$	21	$	144	$	27	$	853

Three Months Ended March 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(1)	(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	51		213		110		1		30		3		95		9		512
Charge-offs	—		(12)		(19)		—		1		(2)		(22)		(2)		(56)
Recoveries	—		2		—		—		2		2		2		—		8
Net (charge-offs) recoveries	—		(10)		(19)		—		3		—		(20)		(2)		(48)

Allowance for credit losses – end of period	$	92	$	382	$	248	$	5	$	(41)	$	16	$	212	$	17	$	931

(1)See Note 2, "Summary of Significant Accounting Policies and New Accounting Pronouncements," in our 2020 Form 10-K for additional discussion.

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 three months ended March 31, 2021 and 2020:



Three Months Ended March 31,	2021		2020
	(in millions)
Balance at beginning of period	$	237	$	104
Cumulative effect adjustment to initially apply new accounting guidance for measuring credit losses(1)	—		54
Balance at beginning of period, adjusted	237		158
Provision charged (credited) to income	(82)		213
Balance at end of period	$	155	$	371

(1)See Note 2, "Summary of Significant Accounting Policies and New Accounting Pronouncements," in our 2020 Form 10-K for additional discussion

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 4, "Securities," and Note 5, "Loans."


	March 31, 2021		December 31, 2020
	(in millions)
Accrued interest receivables:
Loans	$	137	$	140
Securities held-to-maturity	20		23
Other financial assets measured at amortized cost	1		1
Securities available-for-sale	90		100
Total accrued interest receivables	248		264
Allowance for credit losses	2		2
Accrued interest receivables, net	$	246	$	262