Allowance for credit losses

For detailed discussion of the allowance for credit losses and the related accounting policies, see Note 15 of JPMorgan Chase’s 2015 Annual Report.

Allowance for credit losses and related information

The table below summarizes information about the allowances for loan losses, and lending-related commitments, and includes a breakdown of loans and lending-related commitments by impairment methodology.



	2016													2015
Three months ended March 31 (in millions)	Consumer, excluding credit card			Credit card				Wholesale			Total			Consumer, excluding credit card			Credit card				Wholesale			Total
Allowance for loan losses
Beginning balance at January 1,	$	5,806		$	3,434			$	4,315		$	13,555		7,050			$	3,439			$	3,696		$	14,185
Gross charge-offs	365			923				69			1,357			440			883				29			1,352
Gross recoveries	(145		)	(93		)		(9		)	(247		)	(176		)	(94		)		(30		)	(300		)
Net charge-offs/(recoveries)	220			830				60			1,110			264			789				(1		)	1,052
Write-offs of PCI loans^(a)	47			—				—			47			55			—				—			55
Provision for loan losses	221			830				545			1,596			141			789				58			988
Other	—			—				—			—			—			(5		)		4			(1		)
Ending balance at March 31,	$	5,760		$	3,434			$	4,800		$	13,994		$	6,872		$	3,434			$	3,759		$	14,065

Allowance for loan losses by impairment methodology
Asset-specific^(b)	$	371		$	427		^(c)	$	565		$	1,363		$	537		$	458		^(c)	$	115		$	1,110
Formula-based	2,694			3,007				4,235			9,936			3,065			2,976				3,644			9,685
PCI	2,695			—				—			2,695			3,270			—				—			3,270
Total allowance for loan losses	$	5,760		$	3,434			$	4,800		$	13,994		$	6,872		$	3,434			$	3,759		$	14,065

Loans by impairment methodology
Asset-specific	$	9,468		$	1,381			$	2,230		$	13,079		$	11,414		$	1,852			$	743		$	14,009
Formula-based	304,660			124,631				362,078			791,369			248,147			118,983				330,472			697,602
PCI	39,743			—				4			39,747			45,356			—				4			45,360
Total retained loans	$	353,871		$	126,012			$	364,312		$	844,195		$	304,917		$	120,835			$	331,219		$	756,971

Impaired collateral-dependent loans
Net charge-offs	$	21		$	—			$	1		$	22		$	16		$	—			$	1		$	17
Loans measured at fair value of collateral less cost to sell	2,514			—				384			2,898			2,912			—				269			3,181

Allowance for lending-related commitments
Beginning balance at January 1,	$	14		$	—			$	772		$	786		$	13		$	—			$	609		$	622
Provision for lending-related commitments	—			—				228			228			1			—				(30		)	(29		)
Ending balance at March 31,	$	14		$	—			$	1,000		$	1,014		$	14		$	—			$	579		$	593

Allowance for lending-related commitments by impairment methodology
Asset-specific	$	—		$	—			$	192		$	192		$	—		$	—			$	55		$	55
Formula-based	14			—				808			822			14			—				524			538
Total allowance for lending-related commitments	$	14		$	—			$	1,000		$	1,014		$	14		$	—			$	579		$	593

Lending-related commitments by impairment methodology
Asset-specific	$	—		$	—			$	722		$	722		$	—		$	—			$	131		$	131
Formula-based	60,744			532,224				366,744			959,712			60,151			533,511				355,373			949,035
Total lending-related commitments	$	60,744		$	532,224			$	367,466		$	960,434		$	60,151		$	533,511			$	355,504		$	949,166


(a)	Write-offs of PCI loans are recorded against the allowance for loan losses when actual losses for a pool exceed estimated losses that were recorded as purchase accounting adjustments at the time of acquisition. A write-off of a PCI loan is recognized when the underlying loan is removed from a pool (e.g., upon liquidation).


(b)	Includes risk-rated loans that have been placed on nonaccrual status and loans that have been modified in a TDR.


(c)	The asset-specific credit card allowance for loan losses is related to loans that have been modified in a TDR; such allowance is calculated based on the loans’ original contractual interest rates and does not consider any incremental penalty rates.