Reserves for Losses

6 Months Ended

Jun. 30, 2019

Reserves for Losses [Abstract]

Reserves for Losses

3. Reserves for Losses

Reserves for losses relating to Card Member receivables and Card Member loans represent management’s best estimate of the probable inherent losses in Credco’s outstanding portfolio of receivables and loans, as of the balance sheet date. Management’s evaluation process requires certain estimates and judgments.

Changes in Card Member Receivables Reserve for Losses

The following table presents changes in the Card Member receivables reserve for losses for the six months endedJune 30:

(Millions)		2019		2018
Balance, January 1		$	167	$	145
	Provisions		108		119
	Other credits(a)		13		32
	Net write-offs(b)		(111)		(119)
	Other debits(c)		(5)		(20)
Balance, June 30		$	172	$	157

• Primarily reserve balances related to new groups of, and participation interests in, Card Member receivables purchased from affiliates, totaling $2.7 billion and $5.5 billion for the six months endedJune 30, 2019 and 2018, respectively.
• Net of recoveries of $64 million and $55 million for the six months endedJune 30, 2019 and 2018, respectively.
• Primarily reserve balances related to participation interests in Card Member receivables sold to an affiliate. Participation interests in Card Member receivables sold totaled $1.1billion and $3.4 billion for the six months endedJune 30,2019 and 2018, respectively.

Changes in Card Member Loans Reserve for Losses

The following table presents changes in the Card Member loans reserve for losses for the six months endedJune 30:

(Millions)		2019		2018
Balance, January 1		$	5	$	5
	Provisions		6		3
	Net write-offs(a)		(4)		(3)
Balance, June 30		$	7	$	5

Net of recoveries of $1.0 millionforboththe six months endedJune 30, 2019 and 2018.