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LENDING ACTIVITIES (Tables)

3 Months Ended

Mar. 31, 2017

Composition of Mortgages and other loans receivable

	March 31,			December 31,
(in millions)		2017		2016
Commercial mortgages^*	$	25,995	$	25,042
Residential mortgages		4,401		3,828
Life insurance policy loans		2,324		2,367
Commercial loans, other loans and notes receivable		1,447		2,300
Total mortgage and other loans receivable		34,167		33,537
Allowance for credit losses		(289)		(297)
Mortgage and other loans receivable, net	$	33,878	$	33,240

* Commercial mortgages primarily represent loans for offices, apartments and retail properties, with exposures in New York and California representing the largest geographic concentrations (aggregating approximately 23 percent and 12 percent, respectively, at March 31, 2017, and 24 percent and 12 percent, respectively, at December 31, 2016).

Schedule of debt service coverage ratio and loan-to-value ratio for the commercial mortgage loans

	Debt Service Coverage Ratios^(a)
(in millions)		>1.20X		1.00X - 1.20X		<1.00X		Total
March 31, 2017
Loan-to-Value Ratios^(b)
Less than 65%	$	15,636	$	1,309	$	230	$	17,175
65% to 75%		5,842		656		62		6,560
76% to 80%		881		133		82		1,096
Greater than 80%		496		538		130		1,164
Total commercial mortgages	$	22,855	$	2,636	$	504	$	25,995

December 31, 2016
Loan-to-Value Ratios^(b)
Less than 65%	$	13,998	$	1,694	$	232	$	15,924
65% to 75%		5,946		575		62		6,583
76% to 80%		1,246		174		47		1,467
Greater than 80%		471		392		205		1,068
Total commercial mortgages	$	21,661	$	2,835	$	546	$	25,042

(a) The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest.

(b) The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan.

Schedule of credit quality indicators for the commercial mortgage loans

	Number															Percent
	of	Class														of
(dollars in millions)	Loans	Apartments			Offices		Retail	Industrial			Hotel		Others		Total^(c)	Total $
March 31, 2017
Credit Quality Performance Indicator:
In good standing	790	$	6,305	$	8,109	$	4,993	$	2,196	$	2,261	$	1,963	$	25,827	99	%
Restructured^(a)	4		-		134		18		-		16		-		168	1
90 days or less delinquent	-		-		-		-		-		-		-		-	-
>90 days delinquent or in
process of foreclosure	-		-		-		-		-		-		-		-	-
Total^(b)	794	$	6,305	$	8,243	$	5,011	$	2,196	$	2,277	$	1,963	$	25,995	100	%
Allowance for credit losses:
Specific		$	-	$	5	$	1	$	-	$	1	$	-	$	7	-	%
General			44		72		46		9		13		16		200	1
Total allowance for credit losses		$	44	$	77	$	47	$	9	$	14	$	16	$	207	1	%

December 31, 2016
Credit Quality Performance Indicator:
In good standing	784	$	6,005	$	7,830	$	5,179	$	1,898	$	2,373	$	1,589	$	24,874	99	%
Restructured^(a)	4		-		134		18		-		16		-		168	1
90 days or less delinquent	-		-		-		-		-		-		-		-	-
>90 days delinquent or in
process of foreclosure	-		-		-		-		-		-		-		-	-
Total^(b)	788	$	6,005	$	7,964	$	5,197	$	1,898	$	2,389	$	1,589	$	25,042	100	%
Allowance for credit losses:
Specific		$	-	$	3	$	1	$	6	$	1	$	-	$	11	-	%
General			35		72		41		7		13		15		183	1
Total allowance for credit losses		$	35	$	75	$	42	$	13	$	14	$	15	$	194	1	%

(a) Loans that have been modified in troubled debt restructurings and are performing according to their restructured terms. For additional discussion of troubled debt restructurings, see Note 7 to the Consolidated Financial Statements in the 2016 Annual Report.

(b) Does not reflect allowance for credit losses.

(c) 100 percent of the commercial mortgages held at such respective dates were current as to payments of principal and interest. There were no significant amounts of nonperforming commercial mortgages (defined as those loans where payment of contractual principal or interest is more than 90 days past due) during any of the periods presented.

Schedule of changes in the allowance for losses on Mortgage and other loans receivable

	2017						2016
Three Months Ended March 31,		Commercial		Other				Commercial		Other
(in millions)		Mortgages		Loans		Total		Mortgages		Loans		Total
Allowance, beginning of year	$	194	$	103	$	297	$	171	$	137	$	308
Loans charged off		-		-		-		(11)		-		(11)
Recoveries of loans previously charged off		-		-		-		11		-		11
Net charge-offs		-		-		-		-		-		-
Provision for loan losses		13		(21)		(8)		(5)		(26)		(31)
Other		-		-		-		-		-		-
Allowance, end of period	$	207 ^*	$	82	$	289	$	166 ^*	$	111	$	277

* Of the total allowance, $7 million and $12 million relate to individually assessed credit losses on $266 million and $298 million of commercial mortgages at March 31, 2017 and 2016, respectively.