The following table presents our recorded investment in loans and leases, by segment and class, as of the dates indicated:

Aggregate short-duration advances to our clients included in the institutional segment were $3.84 billion and $2.63 billion at June 30, 2011 and December 31, 2010, respectively. These advances, which we provide in support of clients' investment activities associated with securities settlement, fluctuate based on the volume of securities transactions, and are largely short-term in nature.

The following tables present our recorded investment in each class of loans and leases by credit quality indicator as of the dates indicated:


	Institutional								Commercial Real Estate
June 30, 2011 (In millions)	Investment Funds		Commercial and Financial		Purchased Receivables		Lease Financing		Property Development		Other Acquired Credit- Impaired		Other		Total Loans and Leases
Investment grade	$	8,145	$	836	$	1,685	$	1,150	$	1	$	4	$	39	$	11,860
Speculative		106		173		—		174		375		47		108		983
Doubtful		—		—		—		—		76		13		—		89

Total	$	8,251	$	1,009	$	1,685	$	1,324	$	452	$	64	$	147	$	12,932


	Institutional								Commercial Real Estate
December 31, 2010 (In millions)	Investment Funds		Commercial and Financial		Purchased Receivables		Lease Financing		Property Development		Property Development Acquired- Credit Impaired		Other Acquired Credit- Impaired		Other		Total Loans and Leases
Investment grade	$	6,674	$	579	$	2,199	$	1,279	$	3			$	3	$	49	$	10,786
Speculative		120		101		—		191		362				47		108		929
Substandard		—		50		—		—		—				—		—		50
Doubtful		—		—		—		—		86	$	42		49		15		192

Total	$	6,794	$	730	$	2,199	$	1,470	$	451	$	42	$	99	$	172	$	11,957

Loans and leases are grouped in the tables presented above into the rating categories that align with our internal risk-rating framework. Management considers the ratings to be current as of June 30, 2011. We use an internal risk-rating system to assess the risk of credit loss for each loan or lease. This risk-rating process incorporates the use of risk-rating tools in conjunction with management judgment. Qualitative and quantitative inputs are captured in a systematic manner, and following a formal review and approval process, an internal credit rating based on our credit scale is assigned. In assessing the risk rating assigned to each individual loan or lease, among the factors considered are the borrower's debt capacity, collateral coverage, payment history and delinquency experience, financial flexibility and earnings strength, the expected amounts and sources of repayment, the level and nature of contingencies, if any, and the industry and geography in which the borrower operates. These factors are based on an evaluation of historical and current information, and involve subjective assessment and interpretation. Credit counterparties are evaluated and risk-rated on an individual basis at least annually.

In March 2011, we completed foreclosure on an acquired commercial real estate, or CRE, loan with a recorded investment of $42 million, and took possession of the underlying collateral, which consisted of undeveloped land. The loan was part of the portfolio acquired in 2008 pursuant to indemnified repurchase agreements with an affiliate of Lehman as a result of the Lehman Brothers bankruptcy. The property is recorded in other assets as other real estate owned in our consolidated statement of condition at its fair value of $22 million. The fair value of the property is net of estimated costs to sell it. When we took possession of the collateral, we charged off our recorded investment in the loan and the related allowance for loan losses of $19 million, and as a result this foreclosure had no impact on our consolidated statement of income.

The following table presents our recorded investment in loans and leases and the related allowance for loan losses, disaggregated based on our impairment methodology, as of the dates indicated:

The following table presents our recorded investment in impaired loans and leases for the dates or periods indicated:


	As of June 30, 2011						Three Months Ended June 30, 2011				Six Months Ended June 30, 2011				As of December 31, 2010
(In millions)	Recorded Investment		Unpaid Principal Balance		Related Allowance⁽¹⁾		Average Recorded Investment		Interest Revenue Recognized		Average Recorded Investment		Interest Revenue Recognized		Recorded Investment		Unpaid Principal Balance		Related Allowance⁽¹⁾
With no related allowance recorded:
CRE—property development	$	201	$	231			$	201	$	4	$	203	$	8	$	209	$	240
CRE—property development—acquired credit-impaired		—		34				—		—		—		—		—		34
CRE—other—acquired credit-impaired		16		48				16		—		16		—		16		47
CRE—other		2		3				2		—		8		1		27		29

With an allowance recorded:
CRE—property development		74		114	$	24		79		—		79		—		79		113	$	24
CRE—property development—acquired credit-impaired		—		—		—		—		—		10		—		42		47		19
CRE—other—acquired credit - impaired		48		84		8		75		1		75		1		83		100		26
CRE—other		7		9		—		7		—		7		—		7		9		—

Total CRE	$	348	$	523	$	32	$	380	$	5	$	398	$	10	$	463	$	619	$	69

⁽¹⁾	As of June 30, 2011 and December 31, 2010, we maintained an additional allowance for loan losses of $22 million and $31 million respectively, associated with loans and leases that were not impaired.

As of June 30, 2011, we held an aggregate of approximately $284 million of CRE loans which were modified in troubled debt restructurings, compared to $307 million as of December 31, 2010. No impairment loss was recognized upon restructuring of the loans, as the discounted cash flows of the modified loans exceeded the carrying amount of the original loans as of the modification date.

No institutional loans or leases were 90 days or more contractually past-due as of June 30, 2011 or December 31, 2010. Although a portion of the CRE loans was 90 days or more contractually past-due as of June 30, 2011 and December 31, 2010, we do not report them as past-due loans pursuant to specialized GAAP.

The following table presents the components of our recorded investment in loans and leases on non-accrual status as of the dates indicated:

The loans presented in the table above were placed on non-accrual status by management because the yield associated with those loans was deemed to be non-accretable, based on the expected future collection of principal and interest from the loans. The acquired credit-impaired property development loan presented in the table was foreclosed upon in March 2011, as described previously in this note.

The following tables present activity in the allowance for loan losses for the periods indicated:

The charge-offs recorded in 2011 were mainly related to the previously described foreclosure on an acquired credit-impaired loan, and an acquired credit-impaired loan whose underlying collateral had deteriorated in value. The majority of the provision for loan losses recorded in 2010 resulted from a revaluation of the collateral supporting a CRE loan.

Loans and leases are reviewed on a regular basis, and any provisions for loan losses that are recorded reflect management's estimate of the amount necessary to maintain the allowance for loan losses at a level considered appropriate to absorb estimated probable credit losses inherent in the loan and lease portfolio. With respect to CRE loans, management also considers its expectations with respect to future cash flows from those loans and the value of available collateral. These expectations are based, among other things, on an assessment of economic conditions, including conditions in the commercial real estate market and other factors.