Allowance for Credit Losses

9 Months Ended

Sep. 30, 2011

Loans, Allowance for Credit Losses And Loans Held for Sale [Abstract]

7. Allowance for Credit Losses

An analysis of the allowance for credit losses is presented in the following table:


	Three Months						Nine Months
	Ended						Ended
	September 30,						September 30,
	2011			2010			2011			2010

	(in millions)

Balance at beginning of period	$	746		$	1,166		$	852		$	1,602
Provision for credit losses		78			10			171			(7	)
Charge-offs		(74	)		(172	)		(300	)		(620	)
Recoveries		29			8			56			35
Allowance on loans transferred to held for sale		(30	)		(33	)		(30	)		(33	)
Other		-			-			-			2

Balance at end of period	$	749		$	979		$	749		$	979

The following tables summarize the changes in the allowance for credit losses by product during the three and nine months ended September 30, 2011 and 2010 and the related loan balance by product at September 30, 2011 and December 31, 2010:


	Commercial												Consumer
				Business									Residential
				Banking									Mortgage,
	Construction			and Middle									Excl Home			Home
	and Other			Market			Large			Other			Equity			Equity			Credit			Auto			Other
	Real Estate			Enterprises			Corporate			Comm’l			Mortgages			Mortgages			Card			Finance			Consumer			Total

	(in millions)

Three Months Ended September 30, 2011:
Allowance for credit losses – beginning of period	$	229		$	96		$	110		$	21		$	162		$	62		$	44		$	-		$	22		$	746
Provision charged to income		(9	)		(6	)		28			(15	)		53			8			12			-			7			78
Charge offs		(3	)		(9	)		-			-			(24	)		(15	)		(16	)		-			(7	)		(74	)
Recoveries		-			2			-			22			1			-			3			-			1			29

Net charge offs		(3	)		(7	)		-			22			(23	)		(15	)		(13	)		-			(6	)		(45	)
Allowance on loans transferred to held for sale		-			-			-			(10	)		(4	)		(6	)		(6	)		-			(4	)		(30	)
Other		-			-			-			-			-			-			-			-			-			-

Allowance for credit losses – end of period	$	217		$	83		$	138		$	18		$	188		$	49		$	37		$	-		$	19		$	749

Ending balance: collectively evaluated for impairment	$	114		$	68		$	31		$	14		$	102		$	45		$	30		$	-		$	19		$	423
Ending balance: individually evaluated for impairment(1)		103			15			107			4			86			4			7			-			-			326

Total allowance for credit losses	$	217		$	83		$	138		$	18		$	188		$	49		$	37		$	-		$	19		$	749

Loans:
Collectively evaluated for impairment	$	7,066		$	9,597		$	11,017		$	2,779		$	12,653		$	2,604		$	766		$	-		$	740		$	47,222
Individually evaluated for impairment		707			155			147			144			506			14			22			-			-			1,695
Loans carried at fair value less cost to sell		-			-			-			-			683			-			-			-			-			683

Total loans	$	7,773		$	9,752		$	11,164		$	2,923		$	13,842		$	2,618		$	788		$	-		$	740		$	49,600

Three Months Ended September 30, 2010:
Allowance for credit losses – beginning of period	$	292		$	151		$	168		$	66		$	244		$	104		$	73		$	33		$	35		$	1,166
Provision charged to income		47			6			(31	)		(14	)		(23	)		9			14			-			2			10
Charge offs		(29	)		(22	)		(6	)		(2	)		(46	)		(32	)		(26	)		-			(9	)		(172	)
Recoveries		-			3			-			1			1			-			2			-			1			8

Net charge offs		(29	)		(19	)		(6	)		(1	)		(45	)		(32	)		(24	)		-			(8	)		(164	)
Allowance on loans transferred to held for sale		-			-			-			-			-			-			-			(33	)		-			(33	)
Other		-			-			-			-			-			-			-			-			-			-

Allowance for credit losses – end of period	$	310		$	138		$	131		$	51		$	176		$	81		$	63		$	-		$	29		$	979

Ending balance: collectively evaluated for impairment	$	165		$	119		$	60		$	17		$	125		$	78		$	54		$	-		$	29		$	647
Ending balance: individually evaluated for impairment⁽¹⁾		145			19			71			34			51			3			9			-			-			332

Total allowance for credit losses	$	310		$	138		$	131		$	51		$	176		$	81		$	63		$	-		$	29		$	979

Loans:
Collectively evaluated for impairment	$	7,647		$	7,551		$	11,139		$	2,333		$	12,528		$	3,884		$	1,188		$	-		$	1,125		$	47,395
Individually evaluated for impairment		821			124			89			140			344			8			25			-			-			1,551
Loans carried at fair value less cost to sell		-			-			-			-			753			-			-			-			-			753

Total loans	$	8,468		$	7,675		$	11,228		$	2,473		$	13,625		$	3,892		$	1,213		$	-		$	1,125		$	49,699


	Commercial												Consumer
				Business									Residential
				Banking									Mortgage,
	Construction			and Middle									Excl Home			Home
	and Other			Market			Large			Other			Equity			Equity			Credit			Auto			Other
	Real Estate			Enterprises			Corporate			Comm’l			Mortgages			Mortgages			Card			Finance			Consumer			Total

	(In millions)

Nine Months Ended September 30, 2011:
Allowance for credit losses – beginning of period	$	243		$	132		$	116		$	32		$	167		$	77		$	58		$	-		$	27		$	852
Provision charged to income		13			(15	)		22			(25	)		99			31			31			-			15			171
Charge offs		(46	)		(42	)		-			(2	)		(78	)		(53	)		(56	)		-			(23	)		(300	)
Recoveries		7			8			-			23			4			-			10			-			4			56

Net charge offs		(39	)		(34	)		-			21			(74	)		(53	)		(46	)		-			(19	)		(244	)
Allowance on loans transferred to held for sale		-			-			-			(10	)		(4	)		(6	)		(6	)		-			(4	)		(30	)
Other		-			-			-						-			-			-			-			-			-

Allowance for credit losses – end of period	$	217		$	83		$	138		$	18		$	188		$	49		$	37		$	-		$	19		$	749

Nine Months Ended September 30, 2010:
Allowance for credit losses – beginning of period	$	303		$	184		$	301		$	119		$	347		$	185		$	80		$	36		$	47		$	1,602
Provision charged to income		92			12			(148	)		(19	)		(32	)		(6	)		52			35			7			(7	)
Charge offs		(91	)		(72	)		(24	)		(52	)		(141	)		(98	)		(76	)		(37	)		(29	)		(620	)
Recoveries		6			14			2			1			2			-			7			(1	)		4			35

Net charge offs		(85	)		(58	)		(22	)		(51	)		(139	)		(98	)		(69	)		(38	)		(25	)		(585	)
Allowance on loans transferred to held for sale		-			-			-			-			-			-			-			(33	)		-			(33	)
Other		-			-			-			2			-			-			-			-			-			2

Allowance for credit losses – end of period	$	310		$	138		$	131		$	51		$	176		$	81		$	63		$	-		$	29		$	979


⁽¹⁾		For consumer 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.