XML 33 R20.htm IDEA: XBRL DOCUMENT v3.20.2
Business Segment Information
 6 Months Ended
Jun. 30, 2020
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block] BUSINESS SEGMENT INFORMATION
The Corporation has strategically aligned its operations into three major business segments: the Commercial Bank, the Retail Bank and Wealth Management. These business segments are differentiated based on the type of customer and the related products and services provided. In addition to the three major business segments, the Finance Division is also reported as a segment. Business segment results are produced by the Corporation’s internal management accounting system. This system measures financial results based on the internal business unit structure of the Corporation. The performance of the business segments is not comparable with the Corporation's consolidated results and is not necessarily comparable with similar information for any other financial institution. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. The management accounting system assigns balance sheet and income statement items to each business segment using certain methodologies, which are regularly reviewed and refined. From time to time, the Corporation may make reclassifications among the segments to more appropriately reflect management's current view of the segments, and methodologies may be modified as the management accounting system is enhanced and changes occur in the organizational structure and/or product lines. For comparability purposes, amounts in all periods are based on business unit structure and methodologies in effect at June 30, 2020.
The following discussion provides information about the activities of each business segment. A discussion of the financial results and the factors impacting performance can be found in the section entitled "Business Segments" in the financial review.
The Commercial Bank meets the needs of small and middle market businesses, multinational corporations and governmental entities by offering various products and services including commercial loans and lines of credit, deposits, cash management, capital market products, international trade finance, letters of credit, foreign exchange management services and loan syndication services.
The Retail Bank includes a full range of personal financial services, consisting of consumer lending, consumer deposit gathering and mortgage loan origination. This business segment offers a variety of consumer products including deposit accounts, installment loans, credit cards, student loans, home equity lines of credit and residential mortgage loans.
Wealth Management offers products and services consisting of fiduciary services, private banking, retirement services, investment management and advisory services, investment banking and brokerage services. This business segment also offers the sale of annuity products, as well as life, disability and long-term care insurance products.
The Finance segment includes the Corporation’s securities portfolio and asset and liability management activities. This segment is responsible for managing the Corporation’s funding, liquidity and capital needs, performing interest sensitivity analysis and executing various strategies to manage the Corporation’s exposure to liquidity, interest rate risk and foreign exchange risk.
The Other category includes the income and expense impact of equity and cash, tax benefits not assigned to specific business segments, charges of an unusual or infrequent nature that are not reflective of the normal operations of the business segments and miscellaneous other expenses of a corporate nature.
For further information on the methodologies which form the basis for these results refer to Note 22 to the consolidated financial statements in the Corporation's 2019 Annual Report.
Business segment financial results are as follows:
Commercial
Bank		Retail
Bank		Wealth ManagementFinanceOtherTotal
(dollar amounts in millions)
Three Months Ended June 30, 2020
Earnings summary:
Net interest income (expense)$402  $120  $40  $(95) $4  $471  
Provision for credit losses117  5  16  —  —  138  
Noninterest income144  24  66  11  2  247  
Noninterest expenses207  155  73  1  4  440  
Provision (benefit) for income taxes47  (4) 3  (20) 1  27  
Net income (loss)$175  $(12) $14  $(65) $1  $113  
Net credit-related charge-offs$48  $1  $1  $—  $—  $50  
Selected average balances:
Assets $47,392  $3,306  $5,191  $14,500  $11,255  $81,644  
Loans 45,914  2,479  5,077  —  28  53,498  
Deposits36,318  22,647  4,217  950  150  64,282  
Statistical data:
Return on average assets (a)1.49 %(0.21)%1.00 %n/mn/m0.55 %
Efficiency ratio (b)37.67  107.15  69.86  n/mn/m61.14  
Three Months Ended June 30, 2019
Earnings summary:
Net interest income (expense)$420  $146  $46  $(23) $14  $603  
Provision for credit losses52  1  (5) —  (4) 44  
Noninterest income136  33  68  13  —  250  
Noninterest expenses195  147  67  —  15  424  
Provision (benefit) for income taxes71  7  13  (4) —  87  
Net income (loss)$238  $24  $39  $(6) $3  $298  
Net credit-related charge-offs (recoveries)$35  $—  $(2) $—  $—  $33  
Selected average balances:
Assets$45,321  $2,839  $5,071  $13,907  $4,114  $71,252  
Loans43,932  2,107  4,930  —  (6) 50,963  
Deposits28,251  20,649  3,740  2,174  181  54,995  
Statistical data:
Return on average assets (a)2.11 %0.44 %3.10 %n/mn/m1.68 %
Efficiency ratio (b)34.98  82.26  58.99  n/mn/m49.65  
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities and a derivative contract tied to the conversion rate of Visa Class B shares.
n/m – not meaningful
Commercial BankRetail BankWealth ManagementFinanceOtherTotal
(dollar amounts in millions)
Six Months Ended June 30, 2020
Earnings summary:
Net interest income (expense)$782  $245  $81  $(139) $15  $984  
Provision for credit losses513  8  28  —  —  549  
Noninterest income271  52  136  25  —  484  
Noninterest expenses401  304  145  1  14  865  
Provision (benefit) for income taxes27  (4) 9  (28) 2  6  
Net income (loss)$112  $(11) $35  $(87) $(1) $48  
Net credit-related charge-offs$131  $2  $1  $—  $—  $134  
Selected average balances:
Assets $45,823  $3,085  $5,134  $14,393  $9,019  $77,454  
Loans 44,253  2,277  5,007  —  14  51,551  
Deposits33,274  21,921  4,120  1,043  166  60,524  
Statistical data:
Return on average assets (a)0.49 %(0.10)%1.34 %n/mn/m0.12 %
Efficiency ratio (b)38.05  101.41  67.00  n/mn/m58.80  
Six Months Ended June 30, 2019
Earnings summary:
Net interest income (expense)$832  $292  $93  $(37) $29  $1,209  
Provision for credit losses46  (3) (10) —  (2) 31  
Noninterest income272  64  132  17  3  488  
Noninterest expenses393  292  139  1  32  857  
Provision (benefit) for income taxes153  16  23  (8) (12) 172  
Net income (loss)$512  $51  $73  $(13) $14  $637  
Net credit-related charge-offs (recoveries)$47  $—  $(3) $—  $—  $44  
Selected average balances:
Assets$44,619  $2,826  $5,121  $13,747  $4,202  $70,515  
Loans43,241  2,105  4,983  —  (6) 50,323  
Deposits28,356  20,560  3,770  1,655  157  54,498  
Statistical data:
Return on average assets (a)2.31 %0.49 %2.88 %n/mn/m1.82 %
Efficiency ratio (b)35.61  81.80  61.67  n/mn/m50.23  
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities and a derivative contract tied to the conversion rate of Visa Class B shares.
n/m – not meaningful

The Corporation operates in three primary markets - Texas, California and Michigan, as well as in Arizona and Florida, with select businesses operating in several other states and in Canada and Mexico. The Corporation produces market segment results for the Corporation’s three primary geographic markets as well as Other Markets. Other Markets includes Florida, Arizona, the International Finance division and businesses with a national perspective. The Finance & Other category includes the Finance segment and the Other category as previously described. Market segment results are provided as supplemental information to the business segment results and may not meet all operating segment criteria as set forth in GAAP. For comparability purposes, amounts in all periods are based on market segments and methodologies in effect at June 30, 2020.
A discussion of the financial results and the factors impacting performance can be found in the section entitled "Market Segments" in the financial review.
Market segment financial results are as follows:
MichiganCaliforniaTexasOther
Markets		Finance
& Other		Total
(dollar amounts in millions)
Three Months Ended June 30, 2020
Earnings summary:
Net interest income (expense)$159  $176  $116  $111  $(91) $471  
Provision for credit losses40  51  31  16  —  138  
Noninterest income64  36  30  104  13  247  
Noninterest expenses139  103  91  102  5  440  
Provision (benefit) for income taxes8  13  4  21  (19) 27  
Net income (loss)$36  $45  $20  $76  $(64) $113  
Net credit-related charge-offs$—  $4  $46  $—  $—  $50  
Selected average balances:
Assets $13,643  $18,948  $11,597  $11,732  $25,724  $81,644  
Loans 13,014  18,663  11,184  10,640  (3) 53,498  
Deposits23,460  18,463  10,209  11,050  1,100  64,282  
Statistical data:
Return on average assets (a)0.59 %0.93 %0.68 %2.53 %n/m0.55 %
Efficiency ratio (b)62.08  48.61  61.88  47.41  n/m61.14  
Three Months Ended June 30, 2019
Earnings summary:
Net interest income (expense)$186  $208  $124  $94  $(9) $603  
Provision for credit losses(10) (4) 49  13  (4) 44  
Noninterest income72  40  34  91  13  250  
Noninterest expenses134  99  84  92  15  424  
Provision (benefit) for income taxes30  39  6  16  (4) 87  
Net income (loss)$104  $114  $19  $64  $(3) $298  
Net credit-related charge-offs$—  $7  $26  $—  $—  $33  
Selected average balances:
Assets$13,239  $19,108  $11,342  $9,542  $18,021  $71,252  
Loans12,704  18,806  10,684  8,775  (6) 50,963  
Deposits19,816  16,314  8,668  7,842  2,355  54,995  
Statistical data:
Return on average assets (a)2.01 %2.38 %0.69 %2.75 %n/m1.68 %
Efficiency ratio (b)52.04  40.07  52.86  49.36  n/m49.65  
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities and a derivative contract tied to the conversion rate of Visa Class B shares.
n/m – not meaningful.
MichiganCaliforniaTexasOther MarketsFinance & OtherTotal
(dollar amounts in millions)
Six Months Ended June 30, 2020
Earnings summary:
Net interest income (expense)$322  $358  $231  $197  $(124) $984  
Provision for credit losses64  102  321  62  —  549  
Noninterest income136  72  60  191  25  484  
Noninterest expenses279  201  175  195  15  865  
Provision (benefit) for income taxes23  30  (46) 25  (26) 6  
Net income (loss)$92  $97  $(159) $106  $(88) $48  
Net credit-related charge-offs$3  $15  $116  $—  $—  $134  
Selected average balances:
Assets $13,269  $18,664  $11,371  $10,754  $23,396  $77,454  
Loans 12,601  18,346  10,870  9,735  (1) 51,551  
Deposits22,104  17,965  9,705  9,541  1,209  60,524  
Statistical data:
Return on average assets (a)0.81 %1.02 %(2.82)%1.99 %n/m0.12 %
Efficiency ratio (b)60.46  46.77  60.07  50.25  n/m58.80  
Six Months Ended June 30, 2019
Earnings summary:
Net interest income (expense)$373  $411  $248  $185  $(8) $1,209  
Provision for credit losses(5) (5) 38  5  (2) 31  
Noninterest income144  80  66  178  20  488  
Noninterest expenses273  199  169  183  33  857  
Provision (benefit) for income taxes56  76  25  35  (20) 172  
Net income$193  $221  $82  $140  $1  $637  
Net credit-related charge-offs (recoveries)$4  $4  $39  $(3) $—  $44  
Selected average balances:
Assets$13,157  $19,020  $11,128  $9,261  $17,949  $70,515  
Loans12,631  18,730  10,474  8,494  (6) 50,323  
Deposits19,854  16,276  8,682  7,874  1,812  54,498  
Statistical data:
Return on average assets (a)1.89 %2.35 %1.47 %3.06 %n/m1.82 %
Efficiency ratio (b)52.85  40.49  53.74  50.30  n/m50.23  
(a)Return on average assets is calculated based on the greater of average assets or average liabilities and attributed equity.
(b)Noninterest expenses as a percentage of the sum of net interest income and noninterest income excluding net gains (losses) from securities and a derivative contract tied to the conversion rate of Visa Class B shares.
n/m – not meaningful.