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Allowance for Credit Losses and Reserve for Unfunded Lending Commitments (Tables)
 3 Months Ended
Mar. 31, 2024
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]  
Allowance for Credit Losses on Financing Receivables
The table below summarizes changes in the allowance for credit losses and reserve for unfunded lending commitments by portfolio segment for the three months ended March 31, 2024 and 2023. Our allowance for credit losses increased by $84 million to $15.4 billion as of March 31, 2024 from December 31, 2023.
Table 5.1: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity
Three Months Ended March 31, 2024
(Dollars in millions)Credit CardConsumer BankingCommercial BankingTotal
Allowance for credit losses:
Balance as of December 31, 2023$11,709 $2,042 $1,545 $15,296 
Charge-offs
(2,574)(660)(39)(3,273)
Recoveries(1)
367 280 10 657 
Net charge-offs(2,207)(380)(29)(2,616)
Provision for credit losses
2,259 426 22 2,707 
Allowance build (release) for credit losses52 46 (7)91 
Other changes(2)
(7)0 0 (7)
Balance as of March 31, 202411,754 2,088 1,538 15,380 
Reserve for unfunded lending commitments:
Balance as of December 31, 20230 0 158 158 
Provision (benefit) for losses on unfunded lending commitments0 0 (24)(24)
Balance as of March 31, 20240 0 134 134 
Combined allowance and reserve as of March 31, 2024$11,754 $2,088 $1,672 $15,514 
Three Months Ended March 31, 2023
(Dollars in millions)Credit CardConsumer BankingCommercial BankingTotal
Allowance for credit losses:
Balance as of December 31, 2022$9,545 $2,237 $1,458 $13,240 
Cumulative effects of accounting standards adoption(3)
(63)0 0 (63)
Balance as of January 1, 20239,482 2,237 1,458 13,177 
Charge-offs
(1,688)(531)(24)(2,243)
Recoveries(1)
319 224 3 546 
Net charge-offs(1,369)(307)(21)(1,697)
Provision for credit losses2,261 275 266 2,802 
Allowance build (release) for credit losses892 (32)245 1,105 
Other changes(4)
36 0 0 36 
Balance as of March 31, 202310,410 2,205 1,703 14,318 
Reserve for unfunded lending commitments:
Balance as of December 31, 20220 0 218 218 
Provision (benefit) for losses on unfunded lending commitments0 0 (7)(7)
Balance as of March 31, 20230 0 211 211 
Combined allowance and reserve as of March 31, 2023$10,410 $2,205 $1,914 $14,529 
________
(1)The amount and timing of recoveries are impacted by our collection strategies, which are based on customer behavior and risk profile and include direct customer communications, repossession of collateral, the periodic sale of charged off loans as well as additional strategies, such as litigation.
(2)Primarily represents foreign currency translation adjustments.
(3)Impact from the adoption of ASU No. 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings (“TDR”) and Vintage Disclosures as of January 1, 2023.
(4)Primarily represents the initial allowance for purchased credit-deteriorated (“PCD”) loans. The initial allowance of PCD loans was $32 million for the three months ended March 31, 2023.
Credit Quality Indicator
The table below presents our credit card portfolio by delinquency status as of March 31, 2024 and December 31, 2023.
Table 4.3: Credit Card Delinquency Status
March 31, 2024December 31, 2023
(Dollars in millions)Revolving LoansRevolving Loans Converted to TermTotalRevolving LoansRevolving Loans Converted to TermTotal
Credit Card:
Domestic credit card:
Current
$137,043 $373 $137,416 $140,521 $339 $140,860 
30-59 days
1,709 26 1,735 1,940 28 1,968 
60-89 days
1,352 19 1,371 1,454 17 1,471 
Greater than 90 days
3,313 26 3,339 3,339 28 3,367 
Total domestic credit card143,417 444 143,861 147,254 412 147,666 
International card businesses:
Current
6,368 33 6,401 6,521 31 6,552 
30-59 days
108 5 113 112 4 116 
60-89 days
71 4 75 72 4 76 
Greater than 90 days
139 5 144 132 5 137 
Total international card businesses6,686 47 6,733 6,837 44 6,881 
Total credit card$150,103 $491 $150,594 $154,091 $456 $154,547 
The table below presents our consumer banking portfolio of loans held for investment by credit quality indicator as of March 31, 2024 and December 31, 2023. We present our auto loan portfolio by Fair Isaac Corporation (“FICO”) scores at origination and our retail banking loan portfolio by delinquency status, which includes all past due loans, both performing and nonperforming.
Table 4.4: Consumer Banking Portfolio by Vintage Year
March 31, 2024
Term Loans by Vintage Year
(Dollars in millions)20242023202220212020PriorTotal Term LoansRevolving LoansRevolving Loans Converted to TermTotal
Auto—At origination FICO scores:(1)
Greater than 660$4,180 $11,141 $11,433 $8,457 $2,654 $1,132 $38,997 $0 $0 $38,997 
621-6601,367 4,526 4,030 2,974 1,148 600 14,645 0 0 14,645 
620 or below1,865 6,228 5,036 3,807 2,024 1,199 20,159 0 0 20,159 
Total auto7,412 21,895 20,499 15,238 5,826 2,931 73,801 0 0 73,801 
Retail banking—Delinquency status:
Current69 77 92 56 62 554 910 355 4 1,269 
30-59 days0 0 0 1 0 2 3 8 0 11 
60-89 days0 0 0 0 0 1 1 2 0 3 
Greater than 90 days0 0 0 0 1 7 8 5 2 15 
Total retail banking69 77 92 57 63 564 922 370 6 1,298 
Total consumer banking$7,481 $21,972 $20,591 $15,295 $5,889 $3,495 $74,723 $370 $6 $75,099 
December 31, 2023
Term Loans by Vintage Year
(Dollars in millions)20232022202120202019PriorTotal Term LoansRevolving LoansRevolving Loans Converted to TermTotal
Auto—At origination FICO scores:(1)
Greater than 660$12,219 $12,593 $9,505 $3,124 $1,213 $309 $38,963 $0 $0 $38,963 
621-6604,863 4,432 3,346 1,337 592 192 14,762 0 0 14,762 
620 or below6,647 5,539 4,283 2,349 1,131 401 20,350 0 0 20,350 
Total auto23,729 22,564 17,134 6,810 2,936 902 74,075 0 0 74,075 
Retail banking—Delinquency status:
Current98 157 57 65 117 468 962 363 4 1,329 
30-59 days1 0 1 1 0 1 4 11 0 15 
60-89 days0 0 0 0 0 1 1 2 0 3 
Greater than 90 days0 0 0 0 0 8 8 6 1 15 
Total retail banking99 157 58 66 117 478 975 382 5 1,362 
Total consumer banking$23,828 $22,721 $17,192 $6,876 $3,053 $1,380 $75,050 $382 $5 $75,437 
__________
(1)Amounts represent period-end loans held for investment in each credit score category. Auto credit scores generally represent average FICO scores obtained from three credit bureaus at the time of application and are not refreshed thereafter. Balances for which no credit score is available or the credit score is invalid are included in the 620 or below category.
The following table presents our commercial banking portfolio of loans held for investment by internal risk ratings as of March 31, 2024 and December 31, 2023. The internal risk rating status includes all past due loans, both performing and nonperforming.
Table 4.5: Commercial Banking Portfolio by Internal Risk Ratings
March 31, 2024
Term Loans by Vintage Year
(Dollars in millions)20242023202220212020PriorTotal Term LoansRevolving LoansRevolving Loans Converted to TermTotal
Internal risk rating:(1)
Commercial and multifamily real estate
Noncriticized$646 $2,794 $4,392 $2,573 $994 $5,280 $16,679 $13,046 $25 $29,750 
Criticized performing53 59 1,501 685 220 1,331 3,849 130 2 3,981 
Criticized nonperforming12 60 45 118 0 299 534 7 0 541 
Total commercial and multifamily real estate711 2,913 5,938 3,376 1,214 6,910 21,062 13,183 27 34,272 
Commercial and industrial
Noncriticized1,037 6,784 11,627 6,701 3,341 7,339 36,829 14,096 129 51,054 
Criticized performing42 328 638 672 126 437 2,243 1,284 1 3,528 
Criticized nonperforming0 12 96 41 178 221 548 59 0 607 
Total commercial and industrial1,079 7,124 12,361 7,414 3,645 7,997 39,620 15,439 130 55,189 
Total commercial banking$1,790 $10,037 $18,299 $10,790 $4,859 $14,907 $60,682 $28,622 $157 $89,461 
December 31, 2023
Term Loans by Vintage Year
(Dollars in millions)20232022202120202019PriorTotal Term LoansRevolving LoansRevolving Loans Converted to TermTotal
Internal risk rating:(1)
Commercial and multifamily real estate
Noncriticized$3,068 $4,665 $2,773 $1,019 $2,104 $3,670 $17,299 $12,565 $25 $29,889 
Criticized performing148 1,494 706 284 463 904 3,999 133 0 4,132 
Criticized nonperforming65 26 124 0 47 163 425 0 0 425 
Total commercial and multifamily real estate3,281 6,185 3,603 1,303 2,614 4,737 21,723 12,698 25 34,446 
Commercial and industrial
Noncriticized6,909 11,935 6,994 3,566 2,359 5,117 36,880 14,822 167 51,869 
Criticized performing353 706 655 237 348 349 2,648 1,189 0 3,837 
Criticized nonperforming13 53 30 18 123 68 305 31 0 336 
Total commercial and industrial7,275 12,694 7,679 3,821 2,830 5,534 39,833 16,042 167 56,042 
Total commercial banking$10,556 $18,879 $11,282 $5,124 $5,444 $10,271 $61,556 $28,740 $192 $90,488 
__________
(1)Criticized exposures correspond to the “Special Mention,” “Substandard” and “Doubtful” asset categories defined by bank regulatory authorities.
The table below presents gross charge-offs for loans held for investment by vintage year during the three months ended March 31, 2024.
Table 5.2: Gross Charge-Offs by Vintage Year
Three Months Ended March 31, 2024
Term Loans by Vintage Year
(Dollars in millions)20242023202220212020PriorTotal Term LoansRevolving LoansRevolving Loans Converted to TermTotal
Credit Card
Domestic credit cardN/AN/AN/AN/AN/AN/AN/A$2,422 $30 $2,452 
International card businessN/AN/AN/AN/AN/AN/AN/A119 3 122 
Total credit cardN/AN/AN/AN/AN/AN/AN/A2,541 33 2,574 
Consumer Banking
Auto$4 $138 $218 $163 $68 $51 $642 0 0 642 
Retail banking0 0 0 0 0 0 0 18 0 18 
Total consumer banking4 138 218 163 68 51 642 18 0 660 
Commercial Banking
Commercial and multifamily real estate0 0 0 0 0 27 27 0 0 27 
Commercial and industrial0 0 0 4 8 0 12 0 0 12 
Total commercial banking0 0 0 4 8 27 39 0 0 39 
Total$4 $138 $218 $167 $76 $78 $681 $2,559 $33 $3,273 
Schedule of Loss Sharing Arrangement Impact
The table below summarizes the changes in the estimated reimbursements from these partners for the three months ended March 31, 2024 and 2023.
Table 5.3: Summary of Credit Card Partnership Loss Sharing Arrangements Impacts
Three Months Ended March 31,
(Dollars in millions)20242023
Estimated reimbursements from partners, beginning of period$2,014 $1,558 
Amounts due from partners for charged off loans(324)(201)
Change in estimated partner reimbursements that decreased provision for credit losses
385 484 
Estimated reimbursements from partners, end of period$2,075 $1,841