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Loans

9 Months Ended

Sep. 30, 2019

NOTE 4—LOANS

Loan Portfolio Composition

Our loan portfolio consists of loans held for investment, including loans held in our consolidated trusts, and loans held for sale, and is divided into three portfolio segments: credit card, consumer banking and commercial banking. Credit card loans consist of domestic and international credit card loans. Consumer banking loans consist of auto and retail banking loans and in prior periods also consisted of home loans. Commercial banking loans primarily consist of commercial and multifamily real estate as well as commercial and industrial loans. We sold all of our consumer home loan portfolio and the related servicing during 2018. The information presented in this section excludes loans held for sale, which are carried at lower of cost or fair value.

Credit Quality

We closely monitor economic conditions and loan performance trends to manage and evaluate our exposure to credit risk. Trends in delinquency rates are an indicator, among other considerations, of credit risk within our loan portfolio. The level of nonperforming loans represents another indicator of the potential for future credit losses. Accordingly, key metrics we track and use in evaluating the credit quality of our loan portfolio include delinquency and nonperforming loan rates, as well as net charge-off rates and our internal risk ratings of commercial loans.

The table below presents the composition and an aging analysis of our loans held for investment as of September 30, 2019 and December 31, 2018. The delinquency aging includes all past due loans, both performing and nonperforming.

Table 4.1: Loan Portfolio Composition and Aging Analysis



	September 30, 2019
(Dollars in millions)	Current			30-59 Days			60-89 Days			> 90 Days			Total Delinquent Loans			PCI Loans			Total Loans
Credit Card:
Domestic credit card	$	100,784		$	1,175		$	832		$	1,873		$	3,880		$	0		$	104,664
International card businesses	8,683			128			81			125			334			0			9,017
Total credit card	109,467			1,303			913			1,998			4,214			0			113,681
Consumer Banking:
Auto	55,071			2,607			1,258			342			4,207			0			59,278
Retail banking	2,690			24			7			14			45			2			2,737
Total consumer banking	57,761			2,631			1,265			356			4,252			2			62,015
Commercial Banking:
Commercial and multifamily real estate	29,930			18			7			33			58			21			30,009
Commercial and industrial	43,404			57			79			100			236			10			43,650
Total commercial banking	73,334			75			86			133			294			31			73,659
Total loans⁽¹⁾	$	240,562		$	4,009		$	2,264		$	2,487		$	8,760		$	33		$	249,355
% of Total loans	96.5		%	1.6		%	0.9		%	1.0		%	3.5		%	0.0		%	100.0		%



	December 31, 2018
(Dollars in millions)	Current			30-59 Days			60-89 Days			> 90 Days			Total Delinquent Loans			PCI Loans			Total Loans
Credit Card:
Domestic credit card	$	103,014		$	1,270		$	954		$	2,111		$	4,335		$	1		$	107,350
International card businesses	8,678			127			78			128			333			0			9,011
Total credit card	111,692			1,397			1,032			2,239			4,668			1			116,361
Consumer Banking:
Auto	52,032			2,624			1,326			359			4,309			0			56,341
Retail banking	2,809			23			8			20			51			4			2,864
Total consumer banking	54,841			2,647			1,334			379			4,360			4			59,205
Commercial Banking:
Commercial and multifamily real estate	28,737			101			20			19			140			22			28,899
Commercial and industrial	40,704			135			43			101			279			108			41,091
Total commercial lending	69,441			236			63			120			419			130			69,990
Small-ticket commercial real estate	336			2			1			4			7			0			343
Total commercial banking	69,777			238			64			124			426			130			70,333
Total loans⁽¹⁾	$	236,310		$	4,282		$	2,430		$	2,742		$	9,454		$	135		$	245,899
% of Total loans	96.1		%	1.7		%	1.0		%	1.1		%	3.8		%	0.1		%	100.0		%

__________


⁽¹⁾	Loans, other than PCI loans, include unamortized premiums and discounts, and unamortized deferred fees and costs totaling $1.0 billion and $818 million as of September 30, 2019 and December 31, 2018, respectively.

We pledged loan collateral of $14.4 billion and $15.8 billion to secure a portion of our FHLB borrowing capacity of $19.2 billion and $19.3 billion as of September 30, 2019 and December 31, 2018, respectively. We also pledged loan collateral of $7.2 billion and $9.2 billion to secure our Federal Reserve Discount Window borrowing capacity of $5.8 billion and $7.6 billion as of September 30, 2019 and December 31, 2018, respectively. In addition to loans pledged, we securitized a portion of our credit card and auto loans. See “Note 6—Variable Interest Entities and Securitizations” for additional information.

The following table presents the outstanding balance of loans 90 days or more past due that continue to accrue interest and loans classified as nonperforming as of September 30, 2019 and December 31, 2018. Nonperforming loans generally include loans that have been placed on nonaccrual status. PCI loans are excluded from the table below. See “Note 1—Summary of Significant Accounting Policies” in our 2018 Form 10-K for additional information on our policies for nonperforming loans and accounting for PCI loans.

Table 4.2: 90+ Day Delinquent Loans Accruing Interest and Nonperforming Loans



	September 30, 2019				December 31, 2018
(Dollars in millions)	> 90 Days and Accruing		Nonperforming Loans		> 90 Days and Accruing		Nonperforming Loans
Credit Card:
Domestic credit card	$	1,873	N/A		$	2,111	N/A
International card businesses	119		$	23	122		$	22
Total credit card	1,992		23		2,233		22
Consumer Banking:
Auto	0		432		0		449
Retail banking	0		25		0		30
Total consumer banking	0		457		0		479



	September 30, 2019						December 31, 2018
(Dollars in millions)	> 90 Days and Accruing			Nonperforming Loans			> 90 Days and Accruing			Nonperforming Loans
Commercial Banking:
Commercial and multifamily real estate	$	31		$	36		$	0		$	83
Commercial and industrial	0			413			0			223
Total commercial lending	31			449			0			306
Small-ticket commercial real estate	0			0			0			6
Total commercial banking	31			449			0			312
Total	$	2,023		$	929		$	2,233		$	813
% of Total loans held for investment	0.8		%	0.4		%	0.9		%	0.3		%

Credit Card

Our credit card loan portfolio is highly diversified across millions of accounts and numerous geographies without significant individual exposure. We therefore generally manage credit risk based on portfolios with common risk characteristics. The risk in our credit card loan portfolio correlates to broad economic trends, such as unemployment rates and home values, as well as consumers’ financial condition, all of which can have a material effect on credit performance. The primary indicators we assess in monitoring the credit quality and risk of our credit card loan portfolio are delinquency and charge-off trends, including an analysis of loan migration between delinquency categories over time.

The table below displays the geographic profile of our credit card loan portfolio as of September 30, 2019 and December 31, 2018.

Table 4.3: Credit Card Risk Profile by Geographic Region



	September 30, 2019				December 31, 2018
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Domestic credit card:
California	$	11,297	9.9	%	$	11,591	10.0	%
Texas	8,078		7.1		8,173		7.0
New York	7,224		6.4		7,400		6.4
Florida	7,009		6.2		7,086		6.1
Illinois	4,574		4.0		4,761		4.1
Pennsylvania	4,382		3.9		4,575		3.9
Ohio	3,818		3.4		3,967		3.4
New Jersey	3,541		3.1		3,641		3.1
Michigan	3,415		3.0		3,544		3.0
Other	51,326		45.1		52,612		45.3
Total domestic credit card	104,664		92.1		107,350		92.3
International card businesses:
Canada	6,155		5.4		6,023		5.1
United Kingdom	2,862		2.5		2,988		2.6
Total international card businesses	9,017		7.9		9,011		7.7
Total credit card	$	113,681	100.0	%	$	116,361	100.0	%

The table below presents net charge-offs for the three and nine months ended September 30, 2019 and 2018.

Table 4.4: Credit Card Net Charge-Offs



	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019				2018
(Dollars in millions)	Amount		Rate⁽¹⁾		Amount		Rate⁽¹⁾		Amount		Rate⁽¹⁾		Amount		Rate⁽¹⁾
Net charge-offs:⁽¹⁾
Domestic credit card	$	1,065	4.12	%	$	1,094	4.35	%	$	3,599	4.67	%	$	3,581	4.78	%
International card businesses	86		3.78		43		1.92		236		3.54		193		2.85
Total credit card	$	1,151	4.09		$	1,137	4.15		$	3,835	4.58		$	3,774	4.62

__________

⁽¹⁾

Net charge-offs consist of the unpaid principal balance of loans held for investment that we determine to be uncollectible, net of recovered amounts. Net charge-off rate is calculated by dividing annualized net charge-offs by average loans held for investment for the period for each loan category. Net charge-offs and the net charge-off rates are impacted periodically by fluctuations in recoveries, including loan sales.

Consumer Banking

Our consumer banking loan portfolio consists of auto and retail banking loans. Similar to our credit card loan portfolio, the risk in our consumer banking loan portfolio correlates to broad economic trends, such as unemployment rates, gross domestic product and home values, as well as consumers’ financial condition, all of which can have a material effect on credit performance. Delinquency, nonperforming loans and charge-off trends are key indicators we assess in monitoring the credit quality and risk of our consumer banking loan portfolio.

The table below displays the geographic profile of our consumer banking loan portfolio as of September 30, 2019 and December 31, 2018.

Table 4.5: Consumer Banking Risk Profile by Geographic Region



	September 30, 2019				December 31, 2018
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Auto:
Texas	$	7,541	12.2	%	$	7,264	12.3	%
California	6,786		10.9		6,352		10.7
Florida	4,891		7.9		4,623		7.8
Georgia	2,712		4.4		2,665		4.5
Ohio	2,633		4.2		2,502		4.2
Pennsylvania	2,286		3.7		2,167		3.7
Illinois	2,210		3.6		2,171		3.7
Louisiana	2,104		3.4		2,174		3.7
Other	28,115		45.3		26,423		44.6
Total auto	59,278		95.6		56,341		95.2
Retail banking:
New York	799		1.3		837		1.4
Louisiana	729		1.2		772		1.3
Texas	604		0.9		647		1.1
New Jersey	194		0.3		201		0.3
Maryland	158		0.3		161		0.3
Virginia	126		0.2		137		0.2
Other	127		0.2		109		0.2
Total retail banking	2,737		4.4		2,864		4.8
Total consumer banking	$	62,015	100.0	%	$	59,205	100.0	%

The table below presents net charge-offs in our consumer banking loan portfolio for the three and nine months ended September 30, 2019 and 2018, as well as nonperforming loans as of September 30, 2019 and December 31, 2018.

Table 4.6: Consumer Banking Net Charge-Offs (Recoveries) and Nonperforming Loans



	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019				2018
(Dollars in millions)	Amount		Rate⁽¹⁾		Amount		Rate⁽¹⁾		Amount		Rate⁽¹⁾		Amount			Rate⁽¹⁾
Net charge-offs (recoveries):
Auto	$	234	1.60	%	$	243	1.73	%	$	592	1.38	%	$	633		1.53	%
Retail banking	17		2.55		19		2.62		52		2.51		51			2.18
Home loan	0		0.00		0		0.00		0		0.00		(1		)	(0.02	)
Total consumer banking	$	251	1.64		$	262	1.77		$	644	1.43		$	683		1.36



	September 30, 2019				December 31, 2018
(Dollars in millions)	Amount		Rate⁽²⁾		Amount		Rate⁽²⁾
Nonperforming loans:
Auto	$	432	0.73	%	$	449	0.80	%
Retail banking	25		0.91		30		1.04
Total consumer banking	$	457	0.74		$	479	0.81

__________


⁽¹⁾	Net charge-off (recovery) rates are calculated by dividing annualized net charge-offs (recoveries) by average loans held for investment for the period for each loan category.

⁽²⁾

Nonperforming loan rates are calculated based on nonperforming loans for each category divided by period-end total loans held for investment for each respective category.

Commercial Banking

We evaluate the credit risk of commercial loans using a risk rating system. We assign internal risk ratings to loans based on relevant information about the ability of the borrowers to repay their debt. In determining the risk rating of a particular loan, some of the factors considered are the borrower’s current financial condition, historical and projected future credit performance, prospects for support from financially responsible guarantors, the estimated realizable value of any collateral and current economic trends. The scale based on our internal risk rating system is as follows:


•	Noncriticized: Loans that have not been designated as criticized, frequently referred to as “pass” loans.


•	Criticized performing: Loans in which the financial condition of the obligor is stressed, affecting earnings, cash flows or collateral values. The borrower currently has adequate capacity to meet near-term obligations; however, the stress, left unabated, may result in deterioration of the repayment prospects at some future date.

•

Criticized nonperforming: Loans that are not adequately protected by the current net worth and paying capacity of the obligor or the collateral pledged, if any. Loans classified as criticized nonperforming have a well-defined weakness, or weaknesses, which jeopardize the full repayment of the debt. These loans are characterized by the distinct possibility that we will sustain a credit loss if the deficiencies are not corrected and are generally placed on nonaccrual status.

We use our internal risk rating system for regulatory reporting, determining the frequency of credit exposure reviews, and evaluating and determining the allowance for loan and lease losses for commercial loans. Generally, loans that are designated as criticized performing and criticized nonperforming are reviewed quarterly by management to determine if they are appropriately classified/rated and whether any impairment exists. Noncriticized loans are also generally reviewed, at least annually, to determine the appropriate risk rating. In addition, we evaluate the risk rating during the renewal process of any loan or if a loan becomes past due.

The following table presents the geographic concentration and internal risk ratings of our commercial loan portfolio as of September 30, 2019 and December 31, 2018.

Table 4.7: Commercial Banking Risk Profile by Geographic Region and Internal Risk Rating



	September 30, 2019
(Dollars in millions)	Commercial and Multifamily Real Estate		% of Total		Commercial and Industrial		% of Total		Total Commercial Banking		% of Total
Geographic concentration:⁽¹⁾
Northeast	$	16,301	54.3	%	$	8,403	19.3	%	$	24,704	33.5	%
Mid-Atlantic	3,080		10.3		5,572		12.8		8,652		11.7
South	4,437		14.8		15,386		35.2		19,823		26.9
Other	6,191		20.6		14,289		32.7		20,480		27.9
Total	$	30,009	100.0	%	$	43,650	100.0	%	$	73,659	100.0	%
Internal risk rating:⁽²⁾
Noncriticized	$	29,272	97.5	%	$	41,872	96.0	%	$	71,144	96.6	%
Criticized performing	680		2.3		1,355		3.1		2,035		2.8
Criticized nonperforming	36		0.1		413		0.9		449		0.6
PCI loans	21		0.1		10		0.0		31		0.0
Total	$	30,009	100.0	%	$	43,650	100.0	%	$	73,659	100.0	%



	December 31, 2018
(Dollars in millions)	Commercial and Multifamily Real Estate		% of Total		Commercial and Industrial		% of Total		Small-Ticket Commercial Real Estate		% of Total		Total Commercial Banking		% of Total
Geographic concentration:⁽¹⁾
Northeast	$	15,562	53.8	%	$	7,573	18.4	%	$	213	62.1	%	$	23,348	33.2	%
Mid-Atlantic	3,410		11.8		4,710		11.5		12		3.5		8,132		11.6
South	4,247		14.7		15,367		37.4		20		5.8		19,634		27.9
Other	5,680		19.7		13,441		32.7		98		28.6		19,219		27.3
Total	$	28,899	100.0	%	$	41,091	100.0	%	$	343	100.0	%	$	70,333	100.0	%
Internal risk rating:⁽²⁾
Noncriticized	$	28,239	97.7	%	$	39,468	96.1	%	$	336	98.0	%	$	68,043	96.8	%
Criticized performing	555		1.9		1,292		3.1		1		0.3		1,848		2.6
Criticized nonperforming	83		0.3		223		0.5		6		1.7		312		0.4
PCI loans	22		0.1		108		0.3		0		0.0		130		0.2
Total	$	28,899	100.0	%	$	41,091	100.0	%	$	343	100.0	%	$	70,333	100.0	%

__________


⁽¹⁾	Geographic concentration is generally determined by the location of the borrower’s business or the location of the collateral associated with the loan. Northeast consists of CT, MA, ME, NH, NJ, NY, PA and VT. Mid-Atlantic consists of DC, DE, MD, VA and WV. South consists of AL, AR, FL, GA, KY, LA, MO, MS, NC, SC, TN and TX.

⁽²⁾

Criticized exposures correspond to the “Special Mention,” “Substandard” and “Doubtful” asset categories defined by bank regulatory authorities.

Impaired Loans

The following table presents information on our impaired loans as of September 30, 2019 and December 31, 2018, and for the three and nine months ended September 30, 2019 and 2018. Impaired loans include loans modified in troubled debt restructurings (“TDRs”), all nonperforming commercial loans and nonperforming home loans with a specific impairment. Impaired loans without an allowance generally represent loans that have been charged down to the fair value of the underlying collateral for which we believe no additional losses have been incurred, or where the fair value of the underlying collateral meets or exceeds the loan’s amortized cost. PCI loans are excluded from the following table.

Table 4.8: Impaired Loans



	September 30, 2019
(Dollars in millions)	With an Allowance		Without an Allowance		Total Recorded Investment		Related Allowance		Net Recorded Investment		Unpaid Principal Balance
Credit Card:
Domestic credit card	$	625	$	0	$	625	$	115	$	510	$	615
International card businesses	190		0		190		82		108		185
Total credit card⁽¹⁾	815		0		815		197		618		800
Consumer Banking:
Auto	294		41		335		26		309		445
Retail banking	45		2		47		6		41		52
Total consumer banking	339		43		382		32		350		497
Commercial Banking:
Commercial and multifamily real estate	36		33		69		1		68		71
Commercial and industrial	516		141		657		97		560		779
Total commercial banking	552		174		726		98		628		850
Total	$	1,706	$	217	$	1,923	$	327	$	1,596	$	2,147



	December 31, 2018
(Dollars in millions)	With an Allowance		Without an Allowance		Total Recorded Investment		Related Allowance		Net Recorded Investment		Unpaid Principal Balance
Credit Card:
Domestic credit card	$	666	$	0	$	666	$	186	$	480	$	654
International card businesses	189		0		189		91		98		183
Total credit card⁽¹⁾	855		0		855		277		578		837
Consumer Banking:
Auto⁽²⁾	301		38		339		22		317		420
Retail banking	42		12		54		5		49		60
Total consumer banking	343		50		393		27		366		480
Commercial Banking:
Commercial and multifamily real estate	92		28		120		5		115		121
Commercial and industrial	301		169		470		29		441		593
Total commercial lending	393		197		590		34		556		714
Small-ticket commercial real estate	0		6		6		0		6		9
Total commercial banking	393		203		596		34		562		723
Total	$	1,591	$	253	$	1,844	$	338	$	1,506	$	2,040



	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019				2018
(Dollars in millions)	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
Credit Card:
Domestic credit card	$	628	$	14	$	659	$	15	$	645	$	43	$	653	$	47
International card businesses	192		4		186		3		193		11		182		9
Total credit card⁽¹⁾	820		18		845		18		838		54		835		56
Consumer Banking:
Auto⁽²⁾	334		10		366		11		338		29		411		35
Home loan	0		0		0		0		0		0		114		1
Retail banking	52		0		59		0		53		1		60		1
Total consumer banking	386		10		425		11		391		30		585		37
Commercial Banking:
Commercial and multifamily real estate	74		0		67		1		94		1		86		2
Commercial and industrial	605		3		583		6		562		11		658		16
Total commercial lending	679		3		650		7		656		12		744		18
Small-ticket commercial real estate	3		0		5		0		5		0		6		0
Total commercial banking	682		3		655		7		661		12		750		18
Total	$	1,888	$	31	$	1,925	$	36	$	1,890	$	96	$	2,170	$	111

__________


⁽¹⁾	The period-end and average recorded investments of credit card loans include finance charges and fees.

⁽²⁾

2018 amounts include certain TDRs that were recorded as other assets on our consolidated balance sheets.

Troubled Debt Restructurings

Total recorded TDRs were $1.6 billion as of both September 30, 2019 and December 31, 2018. TDRs classified as performing in our credit card and consumer banking loan portfolios totaled $1.1 billion and $1.2 billion as of September 30, 2019 and December 31, 2018, respectively. TDRs classified as performing in our commercial banking loan portfolio totaled $276 million and $282 million as of September 30, 2019 and December 31, 2018, respectively. Commitments to lend additional funds on loans modified in TDRs totaled $220 million and $256 million as of September 30, 2019 and December 31, 2018, respectively.

Loans Modified in TDRs

As part of our loan modification programs to borrowers experiencing financial difficulty, we may provide multiple concessions to minimize our economic loss and improve long-term loan performance and collectability. The following tables present the major modification types, recorded investment amounts and financial effects of loans modified in TDRs during the three and nine months ended September 30, 2019 and 2018.

Table 4.9: Troubled Debt Restructurings



	Total Loans Modified⁽¹⁾		Three Months Ended September 30, 2019
			Reduced Interest Rate				Term Extension			Balance Reduction
(Dollars in millions)			% of TDR Activity⁽²⁾		Average Rate Reduction		% of TDR Activity⁽²⁾		Average Term Extension (Months)	% of TDR Activity⁽²⁾		Gross Balance Reduction
Credit Card:
Domestic credit card	$	85	100	%	16.76	%	0	%	0	0	%	$	0
International card businesses	43		100		27.08		0		0	0		0
Total credit card	128		100		20.19		0		0	0		0
Consumer Banking:
Auto	66		42		3.51		89		8	1		1
Retail banking	1		9		9.30		0		0	0		0
Total consumer banking	67		42		3.53		88		8	1		1
Commercial Banking:
Commercial and industrial	51		9		1.00		15		14	0		0
Total commercial banking	51		9		1.00		15		14	0		0
Total	$	246	65		16.70		27		9	0		$	1



	Total Loans Modified⁽¹⁾		Nine Months Ended September 30, 2019
			Reduced Interest Rate				Term Extension			Balance Reduction
(Dollars in millions)			% of TDR Activity⁽²⁾		Average Rate Reduction		% of TDR Activity⁽²⁾		Average Term Extension (Months)	% of TDR Activity⁽²⁾		Gross Balance Reduction
Credit Card:
Domestic credit card	$	257	100	%	16.58	%	0	%	0	0	%	$	0
International card businesses	130		100		27.25		0		0	0		0
Total credit card	387		100		20.18		0		0	0		0
Consumer Banking:
Auto	190		41		3.70		90		8	1		1
Retail banking	7		10		10.73		54		3	34		0
Total consumer banking	197		40		3.76		89		7	2		1
Commercial Banking:
Commercial and multifamily real estate	34		100		0.00		0		0	0		0
Commercial and industrial	86		5		0.60		25		9	0		0
Total commercial lending	120		32		0.07		18		9	0		0
Small-ticket commercial real estate	1		0		0.00		0		0	0		0
Total commercial banking	121		32		0.07		18		9	0		0
Total	$	705	72		16.08		28		8	1		$	1



	Total Loans Modified⁽¹⁾		Three Months Ended September 30, 2018
			Reduced Interest Rate				Term Extension			Balance Reduction
(Dollars in millions)			% of TDR Activity⁽²⁾		Average Rate Reduction		% of TDR Activity⁽²⁾		Average Term Extension (Months)	% of TDR Activity⁽²⁾		Gross Balance Reduction
Credit Card:
Domestic credit card	$	105	100	%	16.01	%	0	%	0	0	%	$	0
International card businesses	46		100		26.95		0		0	0		0
Total credit card	151		100		19.35		0		0	0		0
Consumer Banking:
Auto⁽³⁾	47		51		3.88		85		9	1		0
Retail banking	0		100		10.45		5		12	0		0
Total consumer banking	47		52		3.93		85		9	1		0
Commercial Banking:
Commercial and multifamily real estate	22		0		0.00		61		3	0		0
Commercial and industrial	50		0		0.00		13		8	0		0
Total commercial lending	72		0		0.00		28		5	0		0
Small-ticket commercial real estate	1		0		0.00		0		0	0		0
Total commercial banking	73		0		0.00		28		5	0		0
Total	$	271	65		17.26		22		8	0		$	0



	Total Loans Modified⁽¹⁾		Nine Months Ended September 30, 2018
			Reduced Interest Rate				Term Extension			Balance Reduction
(Dollars in millions)			% of TDR Activity⁽²⁾		Average Rate Reduction		% of TDR Activity⁽²⁾		Average Term Extension (Months)	% of TDR Activity⁽²⁾		Gross Balance Reduction
Credit Card:
Domestic credit card	$	314	100	%	15.88	%	0	%	0	0	%	$	0
International card businesses	139		100		26.87		0		0	0		0
Total credit card	453		100		19.25		0		0	0		0
Consumer Banking:
Auto⁽³⁾	153		55		3.91		87		8	1		1
Home loan	6		28		1.78		83		214	0		0
Retail banking	6		14		11.09		48		6	0		0
Total consumer banking	165		53		3.94		86		15	1		1
Commercial Banking:
Commercial and multifamily real estate	41		0		0.00		79		5	0		0
Commercial and industrial	147		0		1.19		47		14	0		0
Total commercial lending	188		0		1.19		54		11	0		0
Small-ticket commercial real estate	3		0		0.00		0		0	0		0
Total commercial banking	191		0		1.19		53		11	0		0
Total	$	809	67		16.79		30		14	0		$	1

__________


⁽¹⁾	Represents the recorded investment of total loans modified in TDRs at the end of the quarter in which they were modified. As not every modification type is included in the table above, the total percentage of TDR activity may not add up to 100%. Some loans may receive more than one type of concession as part of the modification.


⁽²⁾	Due to multiple concessions granted to some troubled borrowers, percentages may total more than 100% for certain loan types.


⁽³⁾	Includes certain TDRs that are recorded as other assets on our consolidated balance sheets.

Subsequent Defaults of Completed TDR Modifications

The following table presents the type, number and recorded investment of loans modified in TDRs that experienced a default during the period and had completed a modification event in the twelve months prior to the default. A default occurs if the loan is either 90 days or more delinquent, has been charged off as of the end of the period presented or has been reclassified from accrual to nonaccrual status.

Table 4.10: TDRs—Subsequent Defaults



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
(Dollars in millions)	Number of Contracts	Amount		Number of Contracts	Amount		Number of Contracts	Amount		Number of Contracts	Amount
Credit Card:
Domestic credit card	10,619	$	22	13,983	$	29	36,227	$	77	44,528	$	93
International card businesses	17,104	26		15,104	25		51,995	82		44,397	78
Total credit card	27,723	48		29,087	54		88,222	159		88,925	171
Consumer Banking:
Auto	1,446	18		1,907	20		3,863	47		5,507	62
Home loan	0	0		0	0		0	0		3	1
Retail banking	6	0		12	2		18	1		21	2
Total consumer banking	1,452	18		1,919	22		3,881	48		5,531	65
Commercial Banking:
Commercial and multifamily real estate	0	0		1	3		0	0		1	3
Commercial and industrial	0	0		5	34		0	0		18	79
Total commercial lending	0	0		6	37		0	0		19	82
Total commercial banking	0	0		6	37		0	0		19	82
Total	29,175	$	66	31,012	$	113	92,103	$	207	94,475	$	318