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Allowance for Credit Losses and Reserve for Unfunded Lending Commitments (Tables)

12 Months Ended

Dec. 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 years ended December 31, 2024, 2023 and 2022.

Table 5.1: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity

						Year Ended December 31, 2024
(Dollars in millions)						Credit Card						Consumer Banking						Commercial Banking												Total
Allowance for credit losses:
Balance as of December 31, 2021						$	8,345					$	1,918					$	1,167											$	11,430
Charge-offs						(4,362)						(1,614)						(88)												(6,064)
Recoveries(1)						1,314						760						17												2,091
Net charge-offs						(3,048)						(854)						(71)												(3,973)
Provision for credit losses						4,265						1,173						362												5,800
Allowance build for credit losses						1,217						319						291												1,827
Other changes(2)						(17)						0						0												(17)
Balance as of December 31, 2022						9,545						2,237						1,458												13,240
Reserve for unfunded lending commitments:
Balance as of December 31, 2021						0						0						165												165
Provision for losses on unfunded lending commitments						0						0						53												53
Balance as of December 31, 2022						0						0						218												218
Combined allowance and reserve as of December 31, 2022						$	9,545					$	2,237					$	1,676											$	13,458

						Year Ended December 31, 2024
(Dollars in millions)						Credit Card						Consumer Banking						Commercial Banking												Total
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, 2023						9,482						2,237						1,458												13,177
Charge-offs						(7,787)						(2,327)						(588)												(10,702)
Recoveries(1)						1,315						963						10												2,288
Net charge-offs						(6,472)						(1,364)						(578)												(8,414)
Provision for credit losses						8,651						1,169						665												10,485
Allowance build for credit losses						2,179						(195)						87												2,071
Other changes(2)						48						0						0												48
Balance as of December 31, 2023						11,709						2,042						1,545												15,296
Reserve for unfunded lending commitments:
Balance as of December 31, 2022						0						0						218												218
Provision (benefit) for losses on unfunded lending commitments						0						0						(60)												(60)
Balance as of December 31, 2023						0						0						158												158
Combined allowance and reserve as of December 31, 2023						$	11,709					$	2,042					$	1,703											$	15,454
Allowance for credit losses:
Balance as of December 31, 2023						$	11,709					$	2,042					$	1,545											$	15,296
Charge-offs						(10,757)						(2,758)						(234)												(13,749)
Recoveries(1)						1,770						1,165						66												3,001
Net charge-offs						(8,987)						(1,593)						(168)												(10,748)
Provision for credit losses						10,272						1,435						23												11,730
Allowance build (release) for credit losses(4)						1,285						(158)						(145)												982
Other changes(2)						(20)						0						0												(20)
Balance as of December 31, 2024						12,974						1,884						1,400												16,258
Reserve for unfunded lending commitments:
Balance as of December 31, 2023						0						0						158												158
Provision (benefit) for losses on unfunded lending commitments						0						0						(15)												(15)
Balance as of December 31, 2024						0						0						143												143
Combined allowance and reserve as of December 31, 2024						$	12,974					$	1,884					$	1,543											$	16,401

________

(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 for the year ended December 31, 2024. Primarily represents foreign currency translation adjustments and the initial allowance for PCD loans for the years ended December 31, 2023 and 2022. The initial allowance of PCD loans was $32 million and $10 million for the years ended December 31, 2023 and 2022, respectively.

(3)Impact from the adoption of ASU No. 2022-02, Financial Instruments - Credit Losses (Topic 326): TDR and Vintage Disclosures as of January 1, 2023.

(4)The termination of our Walmart program agreement, effective May 21, 2024 (“Walmart Program Termination”), resulted in an allowance for credit losses build in Domestic Card of $826 million in the second quarter of 2024.

Credit Quality Indicator

The table below presents our credit card portfolio by delinquency status as of December 31, 2024 and 2023.

Table 4.3: Credit Card Delinquency Status

												December 31, 2024																		December 31, 2023
(Dollars in millions)												Revolving Loans						Revolving Loans Converted to Term						Total						Revolving Loans						Revolving Loans Converted to Term						Total
Credit Card:
Domestic credit card:
Current												$	148,112					$	453					$	148,565					$	140,521					$	339					$	140,860
30-59 days												1,944						29						1,973						1,940						28						1,968
60-89 days												1,483						20						1,503						1,454						17						1,471
Greater than 90 days												3,549						28						3,577						3,339						28						3,367
Total domestic credit card												155,088						530						155,618						147,254						412						147,666
International card businesses:
Current												6,533						37						6,570						6,521						31						6,552
30-59 days												102						5						107						112						4						116
60-89 days												69						3						72						72						4						76
Greater than 90 days												135						6						141						132						5						137
Total international card businesses												6,839						51						6,890						6,837						44						6,881
Total credit card												$	161,927					$	581					$	162,508					$	154,091					$	456					$	154,547

The table below presents our consumer banking portfolio of loans held for investment by credit quality indicator as of December 31, 2024 and 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

						December 31, 2024
						Term Loans by Vintage Year
(Dollars in millions)						2024						2023						2022						2021						2020						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Auto—At origination FICO scores:(1)
Greater than 660						$	17,057					$	8,333					$	8,194					$	5,621					$	1,482					$	394					$	41,081					$	0					$	0					$	41,081
621-660						5,584						3,492						2,906						1,986						667						235						14,870						0						0						14,870
620 or below						8,102						4,882						3,626						2,546						1,207						515						20,878						0						0						20,878
Total auto						30,743						16,707						14,726						10,153						3,356						1,144						76,829						0						0						76,829
Retail banking—Delinquency status:
Current						143						78						93						49						51						469						883						351						3						1,237
30-59 days						0						0						0						0						0						2						2						11						0						13
60-89 days						0						0						0						0						0						1						1						2						0						3
Greater than 90 days						0						0						0						0						1						7						8						1						1						10
Total retail banking						143						78						93						49						52						479						894						365						4						1,263
Total consumer banking						$	30,886					$	16,785					$	14,819					$	10,202					$	3,408					$	1,623					$	77,723					$	365					$	4					$	78,092

    

						December 31, 2023
						Term Loans by Vintage Year
(Dollars in millions)						2023						2022						2021						2020						2019						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
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
621-660						4,863						4,432						3,346						1,337						592						192						14,762						0						0						14,762
620 or below						6,647						5,539						4,283						2,349						1,131						401						20,350						0						0						20,350
Total auto						23,729						22,564						17,134						6,810						2,936						902						74,075						0						0						74,075
Retail banking—Delinquency status:
Current						98						157						57						65						117						468						962						363						4						1,329
30-59 days						1						0						1						1						0						1						4						11						0						15
60-89 days						0						0						0						0						0						1						1						2						0						3
Greater than 90 days						0						0						0						0						0						8						8						6						1						15
Total retail banking						99						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 December 31, 2024 and 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

						December 31, 2024
						Term Loans by Vintage Year
(Dollars in millions)						2024						2023						2022						2021						2020						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Internal risk rating:(1)
Commercial and multifamily real estate
Noncriticized						$	1,820					$	2,574					$	3,846					$	2,230					$	903					$	4,887					$	16,260					$	12,691					$	49					$	29,000
Criticized performing						71						89						1,072						35						110						922						2,299						93						2						2,394
Criticized nonperforming						23						0						46						103						86						249						507						2						0						509
Total commercial and multifamily real estate						1,914						2,663						4,964						2,368						1,099						6,058						19,066						12,786						51						31,903
Commercial and industrial
Noncriticized						5,694						6,092						9,952						5,009						2,730						6,239						35,716						15,449						266						51,431
Criticized performing						101						190						680						932						92						258						2,253						887						0						3,140
Criticized nonperforming						41						13						186						43						184						91						558						143						0						701
Total commercial and industrial						5,836						6,295						10,818						5,984						3,006						6,588						38,527						16,479						266						55,272
Total commercial banking						$	7,750					$	8,958					$	15,782					$	8,352					$	4,105					$	12,646					$	57,593					$	29,265					$	317					$	87,175

						December 31, 2023
						Term Loans by Vintage Year
(Dollars in millions)						2023						2022						2021						2020						2019						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
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 performing						148						1,494						706						284						463						904						3,999						133						0						4,132
Criticized nonperforming						65						26						124						0						47						163						425						0						0						425
Total commercial and multifamily real estate						3,281						6,185						3,603						1,303						2,614						4,737						21,723						12,698						25						34,446
Commercial and industrial
Noncriticized						6,909						11,935						6,994						3,566						2,359						5,117						36,880						14,822						167						51,869
Criticized performing						353						706						655						237						348						349						2,648						1,189						0						3,837
Criticized nonperforming						13						53						30						18						123						68						305						31						0						336
Total commercial and industrial						7,275						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 year ended December 31, 2024.

Table 5.2: Gross Charge-Offs by Vintage Year

						Year Ended December 31, 2024
						Term Loans by Vintage Year
(Dollars in millions)						2024						2023						2022						2021						2020												Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Credit Card
Domestic credit card						N/A						N/A						N/A						N/A						N/A												N/A						N/A						$	10,132					$	114					$	10,246
International card business						N/A						N/A						N/A						N/A						N/A												N/A						N/A						497						14						511
Total credit card						N/A						N/A						N/A						N/A						N/A												N/A						N/A						10,629						128						10,757
Consumer Banking
Auto						$	179					$	666					$	837					$	599					$	237											$	156					$	2,674					0						0						2,674
Retail banking						1						0						0						0						1												2						4						79						1						84
Total consumer banking						180						666						837						599						238												158						2,678						79						1						2,758
Commercial Banking
Commercial and multifamily real estate						0						0						4						31						9												82						126						0						0						126
Commercial and industrial						0						0						58						6						17												16						97						11						0						108
Total commercial banking						0						0						62						37						26												98						223						11						0						234
Total						$	180					$	666					$	899					$	636					$	264											$	256					$	2,901					$	10,719					$	129					$	13,749

Schedule of Loss Sharing Arrangement Impact

The table below summarizes the changes in the estimated reimbursements from these partners for the years ended December 31, 2024, 2023 and 2022.

Table 5.3: Summary of Credit Card Partnership Loss Sharing Arrangements Impacts

						Year Ended December 31,
(Dollars in millions)						2024(1)						2023						2022
Estimated reimbursements from partners, beginning of period						$	2,014					$	1,558					$	1,450
Amounts due from partners for charged off loans						(904)						(980)						(515)
Change in estimated partner reimbursements that (increased) decreased provision for credit losses						(100)						1,436						623
Estimated reimbursements from partners, end of period						$	1,010					$	2,014					$	1,558

________

(1) The Walmart Program Termination resulted in an allowance for credit losses build of $826 million in the second quarter of 2024.

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Schedule of loss sharing arrangement impact

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- Definition

Tabular disclosure of allowance for credit loss on financing receivable.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Topic 310
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 11B
-Publisher FASB
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-Name Accounting Standards Codification
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- Definition

Tabular disclosure of financing receivables by credit quality indicator. The credit quality indicator is a statistic about the credit quality of financing receivables. Examples include, but not limited to, consumer credit risk scores, credit-rating-agency ratings, an entity's internal credit risk grades, loan-to-value ratios, collateral, collection experience and other internal metrics.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef
-Topic 310
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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