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LENDING ACTIVITIES (Tables)
 9 Months Ended
Sep. 30, 2013
LENDING ACTIVITIES  
Composition of Mortgages and other loans receivable

 

 

 
  


   
  
   
(in millions)
  

September 30, 2013

   December 31, 2012
  
   

Commercial mortgages*

  
$
14,741
 
 $ 13,788  

Life insurance policy loans

  
 
2,844
 
   2,952  

Commercial loans, other loans and notes receivable

  
 
2,520
 
   3,147
   

Total mortgage and other loans receivable

  
 
20,105
 
   19,887  

Allowance for losses

  
 
(398
)
   (405 )
   

Mortgage and other loans receivable, net

  
$
19,707
 
 $ 19,482
   

*     Commercial mortgages primarily represent loans for office, retail and industrial properties, with exposures in California and New York representing the largest geographic concentrations (aggregating approximately 18 percent and 17 percent at September 30, 2013, respectively, and approximately 22 percent and 15 percent at December 31, 2012, respectively).
Schedule of credit quality indicators for the commercial mortgage loans

 

 

   
 
   Number
of
Loans
   Class    
   Percent
of
Total $
  
September 30, 2013
(dollars in millions)
    
  
  Apartments
   Offices
   Retail
   Industrial
   Hotel
   Others
   Total(c)
  
   

Credit Quality Indicator:

                                                        

In good standing

     974   $ 2,313   $ 4,605   $ 2,920   $ 1,583   $ 1,339   $ 1,570   $ 14,330     97 %

Restructured(a)

     9     54     207     7     –     –     88     356     3  

90 days or less delinquent

     –     –     –     –     –     –     –     –     –  

>90 days delinquent or in process of foreclosure

     9     –     55     –     –     –     –     55     –
   

Total(b)

     992   $ 2,367   $ 4,867   $ 2,927   $ 1,583   $ 1,339   $ 1,658   $ 14,741     100 %
   

Valuation allowance

         $ 10   $ 109   $ 8   $ 20   $ 3   $ 53   $ 203     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 8 to the Consolidated Financial Statements in the 2012 Annual Report.

(b)  Does not reflect valuation allowances.

(c)  Approximately 99 percent of the commercial mortgages held at such respective dates were current as to payments of principal and interest.

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

 

 

 
  


   
    
    
  
   
 
   2013   2012  
Nine Months Ended September 30,
(in millions)
  

Commercial
Mortgages

  

Other
Loans

  

Total

   Commercial
Mortgages
   Other
Loans
   Total
  
   

Allowance, beginning of year

  
$
159
 
$
246
 
$
405
 
 $ 305   $ 435   $ 740  

Loans charged off

  
 
(5
)
 
(37
)
 
(42
)
   (12 )   (6 )   (18 )

Recoveries of loans previously charged off

  
 
3
 
 
6
 
 
9
 
   6     –     6
   

Net charge-offs

  
 
(2
)
 
(31
)
 
(33
)
   (6 )   (6 )   (12 )

Provision for loan losses

  
 
47
 
 
(16
)
 
31
 
   (106 )   33     (73 )

Other

  
 
(1
)
 
(4
)
 
(5
)
   –     –     –  

Activity of discontinued operations

  
 
–
 
 
–
 
 
–
 
   –     (167 )   (167 )
   

Allowance, end of period

  
$
203
*
$
195
 
$
398
 
 $ 193*   $ 295   $ 488
   

*     Of the total allowance at the end of the period, $102 million and $38 million relates to individually assessed credit losses on $267 million and $332 million of commercial mortgage loans at September 30, 2013 and 2012, respectively.