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Loans

9 Months Ended

Sep. 30, 2019

Loan accounting framework

The accounting for a loan depends on management’s strategy for the loan, and on whether the loan was credit-impaired at the date of acquisition. The Firm accounts for loans based on the following categories:


•	Originated or purchased loans held-for-investment (i.e., “retained”), other than PCI loans


•	Loans held-for-sale


•	Loans at fair value


•	PCI loans held-for-investment

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a detailed discussion of loans, including accounting policies. Refer to Note 3 of this Form 10-Q for further information on the Firm’s elections of fair value accounting under the fair value option. Refer to Note 2 of this Form 10-Q for information on loans carried at fair value and classified as trading assets.

Loan portfolio

The Firm’s loan portfolio is divided into three portfolio segments, which are the same segments used by the Firm to determine the allowance for loan losses: Consumer, excluding credit card; Credit card; and Wholesale. Within each portfolio segment the Firm monitors and assesses the credit risk in the following classes of loans, based on the risk characteristics of each loan class.



Consumer, excluding credit card^(a)	Credit card	Wholesale^(f)
Residential real estate – excluding PCI • Residential mortgage^(b) • Home equity^(c) Other consumer loans^(d) • Auto • Consumer & Business Banking^(e) Residential real estate – PCI • Home equity • Prime mortgage • Subprime mortgage • Option ARMs	• Credit card loans	• Commercial and industrial • Real estate • Financial institutions • Governments & Agencies • Other^(g)


(a)	Includes loans held in CCB, scored prime mortgage and scored home equity loans held in AWM and prime mortgage loans held in Corporate.


(b)	Predominantly includes prime loans (including option ARMs).


(c)	Includes senior and junior lien home equity loans.


(d)	Includes certain business banking and auto dealer risk-rated loans that apply the wholesale methodology for determining the allowance for loan losses; these loans are managed by CCB, and therefore, for consistency in presentation, are included with the other consumer loan classes.


(e)	Predominantly includes Business Banking loans.


(f)	Includes loans held in CIB, CB, AWM and Corporate. Excludes scored prime mortgage and scored home equity loans held in AWM and prime mortgage loans held in Corporate. Classes are internally defined and may not align with regulatory definitions.


(g)	Includes loans to: individuals and individual entities (predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts), SPEs and Private education and civic organizations. Refer to Note 14 of JPMorgan Chase’s 2018 Form 10-K for more information on SPEs.

The following tables summarize the Firm’s loan balances by portfolio segment.



September 30, 2019	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
(in millions)	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
Retained	$	331,809	$	159,571	$	437,507	$	928,887	^(b)
Held-for-sale	4,821		—		5,750		10,571
At fair value	—		—		5,760		5,760
Total	$	336,630	$	159,571	$	449,017	$	945,218

December 31, 2018	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
(in millions)	Consumer, excluding credit card		Credit card^(a)		Wholesale		Total
Retained	$	373,637	$	156,616	$	439,162	$	969,415	^(b)
Held-for-sale	95		16		11,877		11,988
At fair value	—		—		3,151		3,151
Total	$	373,732	$	156,632	$	454,190	$	984,554


(a)	Includes accrued interest and fees net of an allowance for the uncollectible portion of accrued interest and fee income.


(b)	Loans (other than PCI loans and loans for which the fair value option has been elected) are presented net of unamortized discounts and premiums and net deferred loan fees or costs. These amounts were not material as of September 30, 2019, and December 31, 2018.

The following tables provide information about the carrying value of retained loans purchased, sold and reclassified to held-for-sale during the periods indicated. Reclassifications of loans to held-for sale are non-cash transactions. The Firm manages its exposure to credit risk on an ongoing basis. Selling loans is one way that the Firm reduces its credit exposures. Loans that were reclassified to held-for-sale and sold in a subsequent period are excluded from the sales line of this table.



	2019									2018
Three months ended September 30, (in millions)	Consumer, excluding credit card			Credit card		Wholesale		Total		Consumer, excluding credit card			Credit card		Wholesale		Total
Purchases	$	259	^(a)(b)	$	—	$	453	$	712	$	561	^(a)(b)	$	—	$	285	$	846
Sales	14,970			—		5,559		20,529		1,789			—		4,197		5,986
Retained loans reclassified to held-for-sale	3,889			—		359		4,248		—			—		666		666

	2019									2018
Nine months ended September 30, (in millions)	Consumer, excluding credit card			Credit card		Wholesale		Total		Consumer, excluding credit card			Credit card		Wholesale		Total
Purchases	$	1,044	^(a)(b)	$	—	$	1,041	$	2,085	$	2,164	^(a)(b)	$	—	$	1,915	$	4,079
Sales	30,484			—		16,404		46,888		4,661			—		12,829		17,490
Retained loans reclassified to held-for-sale	8,950			—		1,784		10,734		36			—		1,926		1,962

(a)

Purchases predominantly represent the Firm’s voluntary repurchase of certain delinquent loans from loan pools as permitted by Government National Mortgage Association (“Ginnie Mae”) guidelines. The Firm typically elects to repurchase these delinquent loans as it continues to service them and/or manage the foreclosure process in accordance with applicable requirements of Ginnie Mae, FHA, RHS, and/or VA.


(b)	Excludes purchases of retained loans sourced through the correspondent origination channel and underwritten in accordance with the Firm’s standards. Such purchases were $4.7 billion and $5.6 billion for the three months ended September 30, 2019 and 2018, respectively, and $12.2 billion and $14.5 billion for the nine months ended September 30, 2019 and 2018, respectively.

Gains and losses on sales of loans

Net gains on sales of loans (including adjustments to record loans held-for-sale at the lower of cost or fair value) recognized in noninterest revenue were $254 million and $433 million, for the three and nine months ended September 30, 2019, respectively. Gains and losses on sales of loans were not material for the three and nine months ended September 30, 2018. In addition, the sale of loans may also result in write downs, recoveries or changes in the allowance recognized in the provision for credit losses.

Consumer, excluding credit card loan portfolio

Consumer loans, excluding credit card loans, consist primarily of residential mortgages, home equity loans and lines of credit, auto loans and consumer and business banking loans, with a focus on serving the prime consumer credit market. The portfolio also includes home equity loans secured by junior liens, prime mortgage loans with an interest-only payment period and certain payment-option loans that may result in negative amortization.

The following table provides information about retained consumer loans, excluding credit card, by class.



(in millions)	September 30, 2019		December 31, 2018
Residential real estate – excluding PCI
Residential mortgage	$	197,456	$	231,078
Home equity	24,954		28,340
Other consumer loans
Auto	61,410		63,573
Consumer & Business Banking	26,699		26,612
Residential real estate – PCI
Home equity	7,753		8,963
Prime mortgage	4,164		4,690
Subprime mortgage	1,797		1,945
Option ARMs	7,576		8,436
Total retained loans	$	331,809	$	373,637

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on consumer credit quality indicators.

Residential real estate – excluding PCI loans

The following table provides information by class for retained residential real estate – excluding PCI loans.



Residential real estate – excluding PCI loans
(in millions, except ratios)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
(in millions, except ratios)	Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018
Loan delinquency^(a)
Current	$	196,354		$	225,899		$	24,398		$	27,611		$	220,752		$	253,510
30–149 days past due	691			2,763			355			453			1,046			3,216
150 or more days past due	411			2,416			201			276			612			2,692
Total retained loans	$	197,456		$	231,078		$	24,954		$	28,340		$	222,410		$	259,418
% of 30+ days past due to total retained loans^(b)	0.53		%	0.48		%	2.23		%	2.57		%	0.72		%	0.71		%
90 or more days past due and government guaranteed^(c)	$	40		$	2,541		$	—		$	—		$	40		$	2,541
Nonaccrual loans	1,629			1,765			1,208			1,323			2,837			3,088
Current estimated LTV ratios^(d)(e)
Greater than 125% and refreshed FICO scores:
Equal to or greater than 660	$	25		$	25		$	4		$	6		$	29		$	31
Less than 660	20			13			2			1			22			14
101% to 125% and refreshed FICO scores:
Equal to or greater than 660	22			37			68			111			90			148
Less than 660	35			53			23			38			58			91
80% to 100% and refreshed FICO scores:
Equal to or greater than 660	4,650			3,977			697			986			5,347			4,963
Less than 660	212			281			214			326			426			607
Less than 80% and refreshed FICO scores:
Equal to or greater than 660	185,438			212,505			20,394			22,632			205,832			235,137
Less than 660	6,035			6,457			2,842			3,355			8,877			9,812
No FICO/LTV available	952			813			710			885			1,662			1,698
U.S. government-guaranteed	67			6,917			—			—			67			6,917
Total retained loans	$	197,456		$	231,078		$	24,954		$	28,340		$	222,410		$	259,418
Geographic region^(f)
California	$	66,166		$	74,759		$	5,074		$	5,695		$	71,240		$	80,454
New York	25,442			28,847			5,074			5,769			30,516			34,616
Illinois	13,304			15,249			1,868			2,131			15,172			17,380
Texas	12,345			13,769			1,640			1,819			13,985			15,588
Florida	10,195			10,704			1,366			1,575			11,561			12,279
Washington	7,638			8,304			762			869			8,400			9,173
Colorado	7,577			8,140			458			521			8,035			8,661
New Jersey	5,749			7,302			1,447			1,642			7,196			8,944
Massachusetts	5,610			6,574			208			236			5,818			6,810
Arizona	3,862			4,434			986			1,158			4,848			5,592
All other^(g)	39,568			52,996			6,071			6,925			45,639			59,921
Total retained loans	$	197,456		$	231,078		$	24,954		$	28,340		$	222,410		$	259,418


(a)	Individual delinquency classifications include mortgage loans insured by U.S. government agencies as follows: current included $20 million and $2.8 billion; 30–149 days past due included $16 million and $2.1 billion; and 150 or more days past due included $31 million and $2.0 billion at September 30, 2019, and December 31, 2018, respectively.


(b)	At September 30, 2019, and December 31, 2018, residential mortgage loans excluded mortgage loans insured by U.S. government agencies of $47 million and $4.1 billion, respectively, that are 30 or more days past due. These amounts have been excluded based upon the government guarantee.

(c)

These balances, which are 90 days or more past due, were excluded from nonaccrual loans as the loans are guaranteed by U.S government agencies. Typically the principal balance of the loans is insured and interest is guaranteed at a specified reimbursement rate subject to meeting agreed-upon servicing guidelines. At September 30, 2019, and December 31, 2018, these balances included $38 million and $999 million, respectively, of loans that are no longer accruing interest based on the agreed-upon servicing guidelines. For the remaining balance, interest is being accrued at the guaranteed reimbursement rate. There were no loans that were not guaranteed by U.S. government agencies that are 90 or more days past due and still accruing interest at September 30, 2019, and December 31, 2018.

(d)

Represents the aggregate unpaid principal balance of loans divided by the estimated current property value. Current property values are estimated, at a minimum, quarterly, based on home valuation models using nationally recognized home price index valuation estimates incorporating actual data to the extent available and forecasted data where actual data is not available. These property values do not represent actual appraised loan level collateral values; as such, the resulting ratios are necessarily imprecise and should be viewed as estimates. Current estimated combined LTV for junior lien home equity loans considers all available lien positions, as well as unused lines, related to the property.


(e)	Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.


(f)	The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.


(g)	At September 30, 2019, and December 31, 2018, included mortgage loans insured by U.S. government agencies of $67 million and $6.9 billion, respectively. These amounts have been excluded from the geographic regions presented based upon the government guarantee.

Approximately 37% of the home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs. The following table provides the Firm’s delinquency statistics for junior lien home equity loans and lines of credit as of September 30, 2019, and December 31, 2018.



	Total loans				Total 30+ day delinquency rate
(in millions, except ratios)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018
(in millions, except ratios)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018
HELOCs:^(a)
Within the revolving period^(b)	$	5,625	$	5,608	0.37	%	0.25	%
Beyond the revolving period	9,283		11,286		2.47		2.80
HELOANs	827		1,030		2.42		2.82
Total	$	15,735	$	17,924	1.72	%	2.00	%


(a)	These HELOCs are predominantly revolving loans for a 10-year period, after which time the HELOC converts to a loan with a 20-year amortization period, but also include HELOCs that allow interest-only payments beyond the revolving period.


(b)	The Firm manages the risk of HELOCs during their revolving period by closing or reducing the undrawn line to the extent permitted by law when borrowers are experiencing financial difficulty.

HELOCs beyond the revolving period and HELOANs have higher delinquency rates than HELOCs within the revolving period. That is primarily because the fully-amortizing payment that is generally required for those products is higher than the minimum payment options available for HELOCs within the revolving period. The higher delinquency rates associated with amortizing HELOCs and HELOANs are factored into the Firm’s allowance for loan losses.

Impaired loans

The table below sets forth information about the Firm’s residential real estate impaired loans, excluding PCI loans. These loans are considered to be impaired as they have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2018 Form 10-K.



(in millions)	Residential mortgage				Home equity				Total residential real estate – excluding PCI
(in millions)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018
Impaired loans
With an allowance	$	2,958	$	3,381	$	1,062	$	1,142	$	4,020	$	4,523
Without an allowance^(a)	1,160		1,184		899		870		2,059		2,054
Total impaired loans^(b)(c)	$	4,118	$	4,565	$	1,961	$	2,012	$	6,079	$	6,577
Allowance for loan losses related to impaired loans	$	63	$	88	$	14	$	45	$	77	$	133
Unpaid principal balance of impaired loans^(d)	5,578		6,207		3,355		3,466		8,933		9,673
Impaired loans on nonaccrual status^(e)	1,376		1,459		981		955		2,357		2,414

(a)

Represents collateral-dependent residential real estate loans that are charged off to the fair value of the underlying collateral less cost to sell. The Firm reports, in accordance with regulatory guidance, residential real estate loans that have been discharged under Chapter 7 bankruptcy and not reaffirmed by the borrower (“Chapter 7 loans”) as collateral-dependent nonaccrual TDRs, regardless of their delinquency status. At September 30, 2019, Chapter 7 residential real estate loans included approximately 12% of residential mortgages and 7% of home equity that were 30 days or more past due.

(b)

At September 30, 2019, and December 31, 2018, $16 million and $4.1 billion, respectively, of loans modified subsequent to repurchase from Ginnie Mae in accordance with the standards of the appropriate government agency (i.e., FHA, VA, RHS) are not included in the table above. When such loans perform subsequent to modification in accordance with Ginnie Mae guidelines, they are generally sold back into Ginnie Mae loan pools. Modified loans that do not re-perform become subject to foreclosure.


(c)	Predominantly all impaired loans in the table above are in the U.S.


(d)	Represents the contractual amount of principal owed at September 30, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors including charge-offs, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.


(e)	At September 30, 2019 and December 31, 2018, nonaccrual loans included $1.9 billion and $2.0 billion, respectively, of TDRs for which the borrowers were less than 90 days past due. Refer to the Loan accounting framework in Note 12 of JPMorgan Chase’s 2018 Form 10-K for additional information about loans modified in a TDR that are on nonaccrual status.

The following tables present average impaired loans and the related interest income reported by the Firm.



Three months ended September 30, (in millions)	Average impaired loans				Interest income on impaired loans^(a)				Interest income on impaired loans on a cash basis^(a)
Three months ended September 30, (in millions)	2019		2018		2019		2018		2019		2018
Residential mortgage	$	4,200	$	4,872	$	55	$	61	$	17	$	19
Home equity	1,938		2,065		33		33		21		21
Total residential real estate – excluding PCI	$	6,138	$	6,937	$	88	$	94	$	38	$	40

Nine months ended September 30, (in millions)	Average impaired loans				Interest income on impaired loans^(a)				Interest income on impaired loans on a cash basis^(a)
Nine months ended September 30, (in millions)	2019		2018		2019		2018		2019		2018
Residential mortgage	$	4,390	$	5,242	$	171	$	197	$	52	$	58
Home equity	1,973		2,092		99		98		62		63
Total residential real estate – excluding PCI	$	6,363	$	7,334	$	270	$	295	$	114	$	121


(a)	Generally, interest income on loans modified in TDRs is recognized on a cash basis until the borrower has made a minimum of six payments under the new terms, unless the loan is deemed to be collateral-dependent.

Loan modifications

Modifications of residential real estate loans, excluding PCI loans, are generally accounted for and reported as TDRs. There were no additional commitments to lend to borrowers whose residential real estate loans, excluding PCI loans, have been modified in TDRs.

The following table presents new TDRs reported by the Firm.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2019		2018		2019		2018
Residential mortgage	$	50	$	67	$	181	$	314
Home equity	100		55		214		241
Total residential real estate – excluding PCI	$	150	$	122	$	395	$	555

Nature and extent of modifications

The U.S. Treasury’s Making Home Affordable programs, as well as the Firm’s proprietary modification programs, generally provide various concessions to financially troubled borrowers including, but not limited to, interest rate reductions, term or payment extensions and deferral of principal and/or interest payments that would otherwise have been required under the terms of the original agreement.

The following tables provide information about how residential real estate loans, excluding PCI loans, were modified under the Firm’s loss mitigation programs described above during the periods presented. These tables exclude Chapter 7 loans where the sole concession granted is the discharge of debt.



Three months ended September 30,									Total residential real estate – excluding PCI
	Residential mortgage				Home equity				Total residential real estate – excluding PCI
	2019		2018		2019		2018		2019		2018
Number of loans approved for a trial modification	365		513		854		586		1,219		1,099
Number of loans permanently modified	307		719		855		939		1,162		1,658
Concession granted:^(a)
Interest rate reduction	78	%	58	%	93	%	77	%	89	%	69	%
Term or payment extension	94		83		59		88		68		86
Principal and/or interest deferred	21		30		6		11		10		19
Principal forgiveness	7		9		4		7		5		8
Other^(b)	53		36		85		58		76		49

Nine months ended September 30,									Total residential real estate – excluding PCI
	Residential mortgage				Home equity				Total residential real estate – excluding PCI
	2019		2018		2019		2018		2019		2018
Number of loans approved for a trial modification	1,603		1,789		1,786		1,895		3,389		3,684
Number of loans permanently modified	1,178		2,374		2,778		4,005		3,956		6,379
Concession granted:^(a)
Interest rate reduction	65	%	36	%	83	%	57	%	78	%	49	%
Term or payment extension	91		49		64		62		72		57
Principal and/or interest deferred	26		47		7		22		13		31
Principal forgiveness	6		7		5		7		5		7
Other^(b)	44		40		71		58		63		52


(a)	Represents concessions granted in permanent modifications as a percentage of the number of loans permanently modified. The sum of the percentages exceeds 100% because predominantly all of the modifications include more than one type of concession. Concessions offered on trial modifications are generally consistent with those granted on permanent modifications.


(b)	Includes variable interest rate to fixed interest rate modifications and forbearances that meet the definition of a TDR for the three and nine months ended September 30, 2019 and 2018. Forbearances suspend or reduce monthly payments for a specific period of time to address a temporary hardship.

Financial effects of modifications and redefaults

The following tables provide information about the financial effects of the various concessions granted in modifications of residential real estate loans, excluding PCI loans, under the loss mitigation programs described above and about redefaults of certain loans modified in TDRs for the periods presented. The following tables present only the financial effects of permanent modifications and do not include temporary concessions offered through trial modifications. These tables also exclude Chapter 7 loans where the sole concession granted is the discharge of debt.



Three months ended September 30, (in millions, except weighted-average data)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
	2019			2018			2019			2018			2019			2018
Weighted-average interest rate of loans with interest rate reductions – before TDR	5.68		%	6.13		%	5.50		%	5.69		%	5.57		%	5.89		%
Weighted-average interest rate of loans with interest rate reductions – after TDR	3.99			4.23			3.30			3.83			3.58			4.01
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR	21			22			19			18			20			21
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR	39			39			39			39			39			39
Charge-offs recognized upon permanent modification	$	—		$	—		$	—		$	—		$	—		$	—
Principal deferred	5			7			1			2			6			9
Principal forgiven	1			3			1			1			2			4
Balance of loans that redefaulted within one year of permanent modification^(a)	$	36		$	27		$	17		$	19		$	53		$	46

Nine months ended September 30, (in millions, except weighted-average data)	Residential mortgage						Home equity						Total residential real estate – excluding PCI
	2019			2018			2019			2018			2019			2018
Weighted-average interest rate of loans with interest rate reductions – before TDR	6.08		%	5.45		%	5.56		%	5.34		%	5.77		%	5.39		%
Weighted-average interest rate of loans with interest rate reductions – after TDR	4.36			3.64			3.60			3.39			3.90			3.49
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – before TDR	21			24			20			18			20			22
Weighted-average remaining contractual term (in years) of loans with term or payment extensions – after TDR	39			38			40			39			39			38
Charge-offs recognized upon permanent modification	$	1		$	—		$	—		$	1		$	1		$	1
Principal deferred	13			17			4			7			17			24
Principal forgiven	3			9			3			5			6			14
Balance of loans that redefaulted within one year of permanent modification^(a)	$	87		$	69		$	45		$	49		$	132		$	118

(a)

Represents loans permanently modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The dollar amounts presented represent the balance of such loans at the end of the reporting period in which such loans defaulted. For residential real estate loans modified in TDRs, payment default is deemed to occur when the loan becomes two contractual payments past due. In the event that a modified loan redefaults, it is probable that the loan will ultimately be liquidated through foreclosure or another similar type of liquidation transaction. Redefaults of loans modified within the last 12 months may not be representative of ultimate redefault levels.

At September 30, 2019, the weighted-average estimated remaining lives of residential real estate loans, excluding PCI loans, permanently modified in TDRs were 10 years for residential mortgage and 9 years for home equity. The estimated remaining lives of these loans reflect estimated prepayments, both voluntary and involuntary (i.e., foreclosures and other forced liquidations).

Active and suspended foreclosure

At September 30, 2019, and December 31, 2018, the Firm had non-PCI residential real estate loans, excluding those insured by U.S. government agencies, with a carrying value of $546 million and $653 million, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

Other consumer loans

The table below provides information for other consumer retained loan classes, including auto and business banking loans.



(in millions, except ratios)	Auto						Consumer & Business Banking						Total other consumer
	Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018
Loan delinquency
Current	$	60,872		$	62,984		$	26,346		$	26,249		$	87,218		$	89,233
30–119 days past due	534			589			231			252			765			841
120 or more days past due	4			—			122			111			126			111
Total retained loans	$	61,410		$	63,573		$	26,699		$	26,612		$	88,109		$	90,185
% of 30+ days past due to total retained loans	0.88		%	0.93		%	1.32		%	1.36		%	1.01		%	1.06		%
Nonaccrual loans^(a)	112			128			268			245			380			373
Geographic region^(b)
California	$	8,016		$	8,330		$	5,744		$	5,520		$	13,760		$	13,850
Texas	6,644			6,531			3,042			2,993			9,686			9,524
New York	3,627			3,863			4,339			4,381			7,966			8,244
Illinois	3,438			3,716			1,737			2,046			5,175			5,762
Florida	3,280			3,256			1,565			1,502			4,845			4,758
Arizona	1,990			2,084			1,268			1,491			3,258			3,575
Ohio	1,900			1,973			1,189			1,305			3,089			3,278
New Jersey	1,920			1,981			805			723			2,725			2,704
Michigan	1,279			1,357			1,264			1,329			2,543			2,686
Louisiana	1,598			1,587			768			860			2,366			2,447
All other	27,718			28,895			4,978			4,462			32,696			33,357
Total retained loans	$	61,410		$	63,573		$	26,699		$	26,612		$	88,109		$	90,185
Loans by risk ratings^(c)
Noncriticized	$	13,823		$	15,749		$	18,738		$	18,743		$	32,561		$	34,492
Criticized performing	394			273			747			751			1,141			1,024
Criticized nonaccrual	—			—			218			191			218			191


(a)	There were no loans that were 90 or more days past due and still accruing interest at September 30, 2019, and December 31, 2018.


(b)	The geographic regions presented in this table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.


(c)	For risk-rated business banking and auto loans, the primary credit quality indicator is the risk rating of the loan, including whether the loans are considered to be criticized and/or nonaccrual.

Other consumer impaired loans and loan

modifications

The table below sets forth information about the Firm’s other consumer impaired loans, including risk-rated business banking and auto loans that have been placed on nonaccrual status, and loans that have been modified in TDRs.



(in millions)	September 30, 2019		December 31, 2018
Impaired loans
With an allowance	$	242	$	222
Without an allowance^(a)	20		29
Total impaired loans^(b)(c)	$	262	$	251
Allowance for loan losses related to impaired loans	$	68	$	63
Unpaid principal balance of impaired loans^(d)	357		355
Impaired loans on nonaccrual status	240		229


(a)	When discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged off and/or there have been interest payments received and applied to the loan balance.


(b)	Predominantly all other consumer impaired loans are in the U.S.

(c)

Other consumer average impaired loans were $254 million and $271 million for the three months ended September 30, 2019 and 2018, respectively, and $248 million and $281 million for the nine months ended September 30, 2019 and 2018, respectively. The related interest income on impaired loans, including those on a cash basis, was not material for the three and nine months ended September 30, 2019 and 2018.


(d)	Represents the contractual amount of principal owed at September 30, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs, interest payments received and applied to the principal balance, net deferred loan fees or costs, and unamortized discounts or premiums on purchased loans.

Loan modifications

Certain other consumer loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All of these TDRs are reported as impaired loans. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on other consumer loans modified in TDRs.

At September 30, 2019 and December 31, 2018, other consumer loans modified in TDRs were $77 million and $79 million, respectively. The impact of these modifications, as well as new TDRs, were not material to the Firm for the three and nine months ended September 30, 2019 and 2018. Additional commitments to lend to borrowers whose loans have been modified in TDRs as of September 30, 2019 and December 31, 2018 were not material. TDRs on nonaccrual status were $55 million and $57 million at September 30, 2019 and December 31, 2018, respectively.

Purchased credit-impaired loans

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a detailed discussion of PCI loans, including the related accounting policies.

Residential real estate – PCI loans

The table below sets forth information about the Firm’s consumer, excluding credit card, PCI loans.



(in millions, except ratios)	Home equity						Prime mortgage						Subprime mortgage						Option ARMs						Total PCI
(in millions, except ratios)	Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018
Carrying value^(a)	$	7,753		$	8,963		$	4,164		$	4,690		$	1,797		$	1,945		$	7,576		$	8,436		$	21,290		$	24,034
Loan delinquency (based on unpaid principal balance)
Current	$	7,543		$	8,624		$	3,759		$	4,226		$	1,915		$	2,033		$	6,876		$	7,592		$	20,093		$	22,475
30–149 days past due	234			278			241			259			247			286			362			398			1,084			1,221
150 or more days past due	165			242			183			223			99			123			350			457			797			1,045
Total loans	$	7,942		$	9,144		$	4,183		$	4,708		$	2,261		$	2,442		$	7,588		$	8,447		$	21,974		$	24,741
% of 30+ days past due to total loans	5.02		%	5.69		%	10.14		%	10.24		%	15.30		%	16.75		%	9.38		%	10.12		%	8.56		%	9.16		%
Current estimated LTV ratios (based on unpaid principal balance)^(b)(c)
Greater than 125% and refreshed FICO scores:
Equal to or greater than 660	$	13		$	17		$	2		$	1		$	—		$	—		$	3		$	3		$	18		$	21
Less than 660	10			13			6			7			7			9			5			7			28			36
101% to 125% and refreshed FICO scores:
Equal to or greater than 660	96			135			6			6			7			4			18			17			127			162
Less than 660	46			65			19			22			24			35			18			33			107			155
80% to 100% and refreshed FICO scores:
Equal to or greater than 660	643			805			58			75			52			54			102			119			855			1,053
Less than 660	271			388			71			112			109			161			128			190			579			851
Lower than 80% and refreshed FICO scores:
Equal to or greater than 660	5,031			5,548			2,559			2,689			809			739			4,932			5,111			13,331			14,087
Less than 660	1,613			1,908			1,283			1,568			1,155			1,327			2,093			2,622			6,144			7,425
No FICO/LTV available	219			265			179			228			98			113			289			345			785			951
Total unpaid principal balance	$	7,942		$	9,144		$	4,183		$	4,708		$	2,261		$	2,442		$	7,588		$	8,447		$	21,974		$	24,741
Geographic region (based on unpaid principal balance)^(d)
California	$	4,704		$	5,420		$	2,280		$	2,578		$	549		$	593		$	4,355		$	4,798		$	11,888		$	13,389
Florida	865			976			295			332			218			234			630			713			2,008			2,255
New York	469			525			338			365			249			268			452			502			1,508			1,660
Illinois	207			233			139			154			115			123			181			199			642			709
Washington	348			419			85			98			38			44			155			177			626			738
New Jersey	184			210			117			134			81			88			222			258			604			690
Massachusetts	56			65			103			113			69			73			216			240			444			491
Maryland	43			48			89			95			90			96			160			178			382			417
Virginia	47			54			82			91			35			37			190			211			354			393
Arizona	138			165			60			69			39			43			99			112			336			389
All other	881			1,029			595			679			778			843			928			1,059			3,182			3,610
Total unpaid principal balance	$	7,942		$	9,144		$	4,183		$	4,708		$	2,261		$	2,442		$	7,588		$	8,447		$	21,974		$	24,741


(a)	Carrying value includes the effect of fair value adjustments that were applied to the consumer PCI portfolio at the date of acquisition.

(b)


(c)	Refreshed FICO scores represent each borrower’s most recent credit score, which is obtained by the Firm on at least a quarterly basis.


(d)	The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.

Approximately 26% of the PCI home equity portfolio are senior lien loans; the remaining balance are junior lien HELOANs or HELOCs. The following table represents the Firm’s delinquency statistics for PCI junior lien home equity loans and lines of credit based on the unpaid principal balance as of September 30, 2019, and December 31, 2018.



	Total loans				Total 30+ day delinquency rate
(in millions, except ratios)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018
(in millions, except ratios)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018
HELOCs^(a)(b)	5,623		6,531		3.66	%	4.00	%
HELOANs	234		280		2.99		3.57
Total	$	5,857	$	6,811	3.64	%	3.98	%


(a)	In general, these HELOCs are revolving loans for a 10-year period, after which time the HELOC converts to an interest-only loan with a balloon payment at the end of the loan’s term. Substantially all HELOCs are beyond the revolving period.


(b)	Includes loans modified into fixed rate amortizing loans.

The table below presents the accretable yield activity for the Firm’s PCI consumer loans for the three and nine months ended September 30, 2019 and 2018, and represents the Firm’s estimate of gross interest income expected to be earned over the remaining life of the PCI loan portfolios. The table excludes the cost to fund the PCI portfolios, and therefore the accretable yield does not represent net interest income expected to be earned on these portfolios.



	Total PCI
(in millions, except ratios)	Three months ended September 30,						Nine months ended September 30,
(in millions, except ratios)	2019			2018			2019			2018
Beginning balance	$	7,699		$	8,722		$	8,422		$	11,159
Accretion into interest income	(272		)	(303		)	(841		)	(958		)
Changes in interest rates on variable-rate loans	(308		)	37			(402		)	(231		)
Other changes in expected cash flows^(a)	255			46			195			(1,468		)
Balance at September 30	$	7,374		$	8,502		$	7,374		$	8,502
Accretable yield percentage	5.27		%	4.95		%	5.32		%	4.88		%


(a)	Other changes in expected cash flows may vary from period to period as the Firm continues to refine its cash flow model, for example cash flows expected to be collected due to the impact of modifications and changes in prepayment assumptions.

Active and suspended foreclosure

At September 30, 2019, and December 31, 2018, the Firm had PCI residential real estate loans with an unpaid principal balance of $776 million and $964 million, respectively, that were not included in REO, but were in the process of active or suspended foreclosure.

Credit card loan portfolio

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on the credit card loan portfolio, including credit quality indicators.

The table below sets forth information about the Firm’s credit card loans.



(in millions, except ratios)	September 30, 2019			December 31, 2018
Loan delinquency
Current and less than 30 days past due and still accruing	$	156,629		$	153,746
30–89 days past due and still accruing	1,500			1,426
90 or more days past due and still accruing	1,442			1,444
Total retained loans	$	159,571		$	156,616
Loan delinquency ratios
% of 30+ days past due to total retained loans	1.84		%	1.83		%
% of 90+ days past due to total retained loans	0.90			0.92
Geographic region^(a)
California	$	24,313		$	23,757
Texas	15,790			15,085
New York	13,940			13,601
Florida	10,101			9,770
Illinois	9,125			8,938
New Jersey	6,821			6,739
Ohio	5,093			5,094
Pennsylvania	4,918			4,996
Colorado	4,543			4,309
Michigan	3,942			3,912
All other	60,985			60,415
Total retained loans	$	159,571		$	156,616
Percentage of portfolio based on carrying value with estimated refreshed FICO scores
Equal to or greater than 660	83.6		%	84.2		%
Less than 660	15.6			15.0
No FICO available	0.8			0.8


(a)	The geographic regions presented in the table are ordered based on the magnitude of the corresponding loan balances at September 30, 2019.

Credit card impaired loans and loan modifications

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a detailed discussion of impaired credit card loans, including credit card loan modifications.

The table below sets forth information about the Firm’s impaired credit card loans. All of these loans are considered to be impaired as they have been modified in TDRs.



(in millions)	September 30, 2019		December 31, 2018
Impaired credit card loans with an allowance^(a)(b)(c)	$	1,423	$	1,319
Allowance for loan losses related to impaired credit card loans	488		440


(a)	The carrying value and the unpaid principal balance are the same for credit card impaired loans.


(b)	There were no impaired loans without an allowance.


(c)	Predominantly all impaired credit card loans are in the U.S.

The following table presents average balances of impaired credit card loans and interest income recognized on those loans.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2019		2018		2019		2018
Average impaired credit card loans	$	1,406	$	1,267	$	1,371	$	1,245
Interest income on impaired credit card loans	18		17		53		48

Loan modifications

The Firm may offer one of a number of loan modification programs to credit card borrowers who are experiencing financial difficulty. Most of the credit card loans have been modified under long-term programs for borrowers who are experiencing financial difficulties. These modifications involve placing the customer on a fixed payment plan, generally for 60 months, and typically include reducing the interest rate on the credit card. Substantially all modifications are considered to be TDRs. New enrollments in these loan modification programs were $242 million and $215 million for the three months ended September 30, 2019 and 2018, respectively, and $717 million and $640 million for the nine months ended September 30, 2019 and 2018, respectively. For all periods disclosed, new enrollments were less than 1% of total retained credit card loans.

Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for additional information about credit card loan modifications.

Financial effects of modifications and redefaults

The following table provides information about the financial effects of the concessions granted on credit card loans modified in TDRs and redefaults for the periods presented.



(in millions, except weighted-average data)	Three months ended September 30,						Nine months ended September 30,
(in millions, except weighted-average data)	2019			2018			2019			2018
Weighted-average interest rate of loans – before TDR	19.18		%	18.25		%	19.23		%	17.82		%
Weighted-average interest rate of loans – after TDR	4.65			5.10			4.80			5.12
Loans that redefaulted within one year of modification^(a)	$	42		$	31		$	108		$	82


(a)	Represents loans modified in TDRs that experienced a payment default in the periods presented, and for which the payment default occurred within one year of the modification. The amounts presented represent the balance of such loans as of the end of the quarter in which they defaulted.

For credit card loans modified in TDRs, payment default is deemed to have occurred when the borrower misses two consecutive contractual payments. A substantial portion of these loans are expected to be charged-off in accordance with the Firm’s standard charge-off policy. Based on historical experience, the estimated weighted-average default rate for modified credit card loans was expected to be 34.30% and 33.38% as of September 30, 2019, and December 31, 2018, respectively.

Wholesale loan portfolio

Wholesale loans include loans made to a variety of clients, ranging from large corporate and institutional clients to high-net-worth individuals. The primary credit quality indicator for wholesale loans is the risk rating assigned to

each loan. Refer to Note 12 and Note 13 of JPMorgan Chase’s 2018 Form 10-K for further information on these risk ratings.

The table below provides information by class of receivable for the retained loans in the Wholesale portfolio segment.



	Commercial and industrial						Real estate						Financial institutions						Governments & Agencies						Other^(d)						Total retained loans
(in millions, except ratios)	Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018
Loans by risk ratings
Investment-grade	$	61,709		$	73,497		$	101,379		$	100,107		$	39,492		$	32,178		$	12,905		$	13,984		$	121,813		$	119,963		$	337,298		$	339,729
Noninvestment-grade:
Noncriticized	52,484			51,720			13,574			14,876			16,123			15,316			206			201			11,059			11,478			93,446			93,591
Criticized performing	3,743			3,738			808			620			202			150			—			2			540			182			5,293			4,692
Criticized nonaccrual	1,291			851			65			134			22			4			—			—			92			161			1,470			1,150
Total noninvestment- grade	57,518			56,309			14,447			15,630			16,347			15,470			206			203			11,691			11,821			100,209			99,433
Total retained loans	$	119,227		$	129,806		$	115,826		$	115,737		$	55,839		$	47,648		$	13,111		$	14,187		$	133,504		$	131,784		$	437,507		$	439,162
% of total criticized exposure to total retained loans	4.22		%	3.54		%	0.75		%	0.65		%	0.40		%	0.32		%	—		%	0.01		%	0.47		%	0.26		%	1.55		%	1.33		%
% of criticized nonaccrual to total retained loans	1.08			0.66			0.06			0.12			0.04			0.01			—			—			0.07			0.12			0.34			0.26

Loans by geographic distribution^(a)
Total non-U.S.	$	28,850		$	29,572		$	3,202		$	2,967		$	17,112		$	18,524		$	2,699		$	3,150		$	48,394		$	48,433		$	100,257		$	102,646
Total U.S.	90,377			100,234			112,624			112,770			38,727			29,124			10,412			11,037			85,110			83,351			337,250			336,516
Total retained loans	$	119,227		$	129,806		$	115,826		$	115,737		$	55,839		$	47,648		$	13,111		$	14,187		$	133,504		$	131,784		$	437,507		$	439,162


Loan delinquency^(b)
Current and less than 30 days past due and still accruing	$	117,621		$	128,678		$	115,733		$	115,533		$	55,764		$	47,622		$	13,097		$	14,165		$	132,844		$	130,918		$	435,059		$	436,916
30–89 days past due and still accruing	279			109			22			67			51			12			13			18			568			702			933			908
90 or more days past due and still accruing^(c)	36			168			6			3			2			10			1			4			—			3			45			188
Criticized nonaccrual	1,291			851			65			134			22			4			—			—			92			161			1,470			1,150
Total retained loans	$	119,227		$	129,806		$	115,826		$	115,737		$	55,839		$	47,648		$	13,111		$	14,187		$	133,504		$	131,784		$	437,507		$	439,162


(a)	The U.S. and non-U.S. distribution is determined based predominantly on the domicile of the borrower.


(b)	The credit quality of wholesale loans is assessed primarily through ongoing review and monitoring of an obligor’s ability to meet contractual obligations rather than relying on the past due status, which is generally a lagging indicator of credit quality. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for a further discussion.


(c)	Represents loans that are considered well-collateralized and therefore still accruing interest.


(d)	Other includes individuals and individual entities (predominantly consists of Wealth Management clients within AWM and includes exposure to personal investment companies and personal and testamentary trusts), SPEs and Private education and civic organizations. Refer to Note 14 of JPMorgan Chase’s 2018 Form 10-K for more information on SPEs.

The following table presents additional information on the real estate class of loans within the Wholesale portfolio for the periods indicated. Refer to Note 12 of JPMorgan Chase’s 2018 Form 10-K for further information on real estate loans.



(in millions, except ratios)	Multifamily						Other commercial						Total real estate loans
(in millions, except ratios)	Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018			Sep 30, 2019			Dec 31, 2018
Real estate retained loans	$	79,169		$	79,184		$	36,657		$	36,553		$	115,826		$	115,737
Criticized exposure	533			388			340			366			873			754
% of total criticized exposure to total real estate retained loans	0.67		%	0.49		%	0.93		%	1.00		%	0.75		%	0.65		%
Criticized nonaccrual	$	34		$	57		$	31		$	77		$	65		$	134
% of criticized nonaccrual loans to total real estate retained loans	0.04		%	0.07		%	0.08		%	0.21		%	0.06		%	0.12		%

Wholesale impaired retained loans and loan modifications

Wholesale impaired retained loans consist of loans that have been placed on nonaccrual status and/or that have been modified in a TDR. All impaired loans are evaluated for an asset-specific allowance as described in Note 13 of JPMorgan Chase’s 2018 Form 10-K.

The table below sets forth information about the Firm’s wholesale impaired retained loans.



(in millions)	Commercial and industrial				Real estate				Financial institutions				Governments & Agencies				Other				Total retained loans
(in millions)	Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018		Sep 30, 2019		Dec 31, 2018		Sep 30, 2019			Dec 31, 2018
Impaired loans
With an allowance	$	1,068	$	807	$	46	$	107	$	22	$	4	$	—	$	—	$	96	$	152	$	1,232		$	1,070
Without an allowance^(a)	279		140		21		27		—		—		—		—		4		13		304			180
Total impaired loans	$	1,347	$	947	$	67	$	134	$	22	$	4	$	—	$	—	$	100	$	165	$	1,536	^(c)	$	1,250	^(c)
Allowance for loan losses related to impaired loans	$	320	$	252	$	13	$	25	$	7	$	1	$	—	$	—	$	2	$	19	$	342		$	297
Unpaid principal balance of impaired loans^(b)	1,532		1,043		104		203		23		4		—		—		336		473		1,995			1,723


(a)	When the discounted cash flows, collateral value or market price equals or exceeds the recorded investment in the loan, the loan does not require an allowance. This typically occurs when the impaired loans have been partially charged-off and/or there have been interest payments received and applied to the loan balance.


(b)	Represents the contractual amount of principal owed at September 30, 2019, and December 31, 2018. The unpaid principal balance differs from the impaired loan balances due to various factors, including charge-offs; interest payments received and applied to the carrying value; net deferred loan fees or costs; and unamortized discount or premiums on purchased loans.


(c)	Based upon the domicile of the borrower, largely consists of loans in the U.S.

The following table presents the Firm’s average impaired retained loans for the periods indicated.



	Three months ended September 30,				Nine months ended September 30,
(in millions)	2019		2018		2019		2018
Commercial and industrial	$	1,073	$	838	$	1,082	$	1,095
Real estate	80		134		105		138
Financial institutions	9		45		11		76
Governments & Agencies	—		—		—		—
Other	123		202		207		214
Total^(a)	$	1,285	$	1,219	$	1,405	$	1,523


(a)	The related interest income on accruing impaired loans and interest income recognized on a cash basis were not material for the three and nine months ended September 30, 2019 and 2018.

Certain loan modifications are considered to be TDRs as they provide various concessions to borrowers who are experiencing financial difficulty. All TDRs are reported as impaired loans in the tables above. TDRs were $498 million and $576 million as of September 30, 2019, and December 31, 2018, respectively. The impact of these modifications, as well as new TDRs, were not material to the Firm for the three and nine months ended September 30, 2019 and 2018.