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Loans and Leases (Tables)
 6 Months Ended
Jun. 30, 2018
Loans and Leases Receivable Disclosure [Abstract]  
Net Loans
The following table presents our recorded investment in loans and leases, by segment, as of the dates indicated:
(In millions)
June 30, 2018
 
December 31, 2017
Domestic:
 
 
 
Commercial and financial:
 
 
 
Loans to investment funds
$
13,359

 
$
13,618

Senior secured bank loans
3,053

 
2,923

Loans to municipalities
1,773

 
2,105

Other
42

 
50

Commercial real estate
285

 
98

Lease financing
78

 
267

Total domestic
18,590

 
19,061

Non-U.S.:
 
 
 
Commercial and financial:
 
 
 
Loans to investment funds
4,535

 
3,213

Senior secured bank loans
646

 
624

Lease financing
353

 
396

Total non-U.S.
5,534

 
4,233

Total loans and leases
24,124

 
23,294

Allowance for loan and lease losses
(55
)
 
(54
)
Loans and leases, net of allowance
$
24,069

 
$
23,240
Recorded Investment in Each Class of Total Loans and Leases by Credit Quality Indicator
The following tables present our recorded investment in each class of loans and leases by credit quality indicator as of the dates indicated:
June 30, 2018
Commercial and Financial
 
Commercial Real Estate
 
Lease
Financing
 
Total Loans and Leases
(In millions)
Investment grade(1)
$
18,182

 
$
285

 
$
430

 
$
18,897

Speculative(2)
5,227

 
—

 
—

 
5,227

Total(4)
$
23,409

 
$
285

 
$
430

 
$
24,124

December 31, 2017
Commercial and Financial
 
Commercial Real Estate
 
Lease
Financing
 
Total Loans and Leases
(In millions)
Investment grade(1)
$
17,866

 
$
98

 
$
663

 
$
18,627

Speculative(2)
4,638

 
—

 
—

 
4,638

Special mention(3)
29

 
—

 
—

 
29

Total(4)
$
22,533

 
$
98

 
$
663

 
$
23,294

 
 
 
 

(1) Investment-grade loans and leases consist of counterparties with strong credit quality and low expected credit risk and probability of default. Ratings apply to counterparties with a strong capacity to support the timely repayment of any financial commitment.
(2) Speculative loans and leases consist of counterparties that face ongoing uncertainties or exposure to business, financial, or economic downturns. However, these counterparties may have financial flexibility or access to financial alternatives, which allow for financial commitments to be met.
(3) Special mention loans and leases consist of counterparties with potential weakness that, if uncorrected, may result in deterioration of repayment prospects.
(4) For those portfolios where there are a small number of loans each with a large balance, we review each loan annually for indicators of impairment. For those loans where no such indicators are identified, the loans are collectively evaluated for impairment. As of June 30, 2018 and December 31, 2017, there were no indicators of impairment.
Schedule of Activity in the Allowance for Loan Losses
The following table presents activity in the allowance for loan and lease losses for the periods indicated:
 
Three Months Ended June 30,
(In millions)
2018
 
2017
Allowance for loan and lease losses(1):
 
 
Beginning balance
$
54

 
$
51

Provision for loan and lease losses
2

 
3

Charge-offs
(1
)
 
—

Ending balance
$
55

 
$
54

 
 
 
 
 
Six Months Ended June 30,
(In millions)
2018
 
2017
Allowance for loan and lease losses(1):
 
 
Beginning balance
$
54

 
$
53

Provision for loan and lease losses
2

 
1

Charge-offs
(1
)
 
—

Ending balance
$
55

 
$
54

 
 
 
 
(1) The provisions and charge-offs for loans and leases were attributable to exposure to senior secured loans to non-investment grade borrowers, purchased in connection with our participation in syndicated loans.