Significant Credit Concentrations

12 Months Ended

Dec. 31, 2017

Concentration Risk Disclosure [Abstract]

Significant Credit Concentrations

Note 12–Significant Credit Concentrations

Concentrations of credit risk exist when changes in economic, industry or geographic factors similarly affect groups of counterparties whose aggregate credit exposure is material in relation to Credco’s total credit exposure. Credco’s primary credit exposure, Card Member receivables and loans and loans to affiliates and other, is diversified among its affiliated companies with Card Members that operate in diverse industries, economic sectors and geographic regions.

The following table details Credco’s maximum credit exposure of the on-balance sheet assets by category, as of December 31:

(Billions)			2017		2016
On-balance sheet:
	Loans to affiliates and other	$	15	$	11
	Institutions(a)		13		11
	Individuals(b)		7		7
	Financial Services(c)		1		2
	Due from affiliates		-		1
Total on-balance sheet		$	36	$	32

• Primarily reflects Card Member receivables from other corporate institutions, which are governed by institutional credit risk management.
• Primarily reflects Card Member receivables and loans, which are governed by individual credit risk management.
• Represents banks, broker-dealers, insurance companies and savings and loan associations.

As of December 31, 2017 and 2016, Credco’s most significant concentration of credit risk was with Loans to affiliates and Corporate institutions, including Card Member receivables. Credco purchased Card Member receivables and loans from TRS and certain of its subsidiaries. TRS generally advances these amounts on an unsecured basis. However, TRS reviews each potential customer’s credit application and evaluates the applicant’s financial history and ability and willingness to repay. TRS also considers, on behalf of Credco, credit performance by customer tenure, industry and geographic location in managing credit exposure.

The following table details Credco’s Card Member receivables and loans exposure in the United States and outside the United States as of December 31:

(Billions)		2017		2016
United States	$	15	$	14
Outside the United States		6		5
Total	$	21	$	19