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

12 Months Ended

Dec. 31, 2025

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 segment for the years ended December 31, 2025, 2024 and 2023. Our allowance for credit losses increased by $7.2 billion to $23.4 billion as of December 31, 2025 from 2024.

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

(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(1)						(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(2)						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 (release) for credit losses						2,179						(195)						87												2,071
Other changes(3)						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

(Dollars in millions)						Credit Card						Consumer Banking						Commercial Banking												Total
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(2)						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						1,285						(158)						(145)												982
Other changes(3)						(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
Allowance for credit losses:
Balance as of December 31, 2024						$	12,974					$	1,884					$	1,400											$	16,258
Charge-offs(4)						(15,216)						(2,662)						(288)												(18,166)
Recoveries(2)						3,645						1,368						51												5,064
Net charge-offs						(11,571)						(1,294)						(237)												(13,102)
Initial allowance for purchased credit deteriorated loans						2,870						0						0												2,870
Benefit from expected recoveries of charged off loans(5)						(3,305)						0						0												(3,305)
Provision for credit losses(6)						19,066						1,302						288												20,656
Allowance build for credit losses						7,060						8						51												7,119
Other changes(3)						32						0						0												32
Balance as of December 31, 2025						20,066						1,892						1,451												23,409
Reserve for unfunded lending commitments:
Balance as of December 31, 2024						0						0						143												143
Provision (benefit) for losses on unfunded lending commitments						0						0						(1)												(1)
Balance as of December 31, 2025						0						0						142												142
Combined allowance and reserve as of December 31, 2025						$	20,066					$	1,892					$	1,593											$	23,551

_________

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

(2)Third-party collection expenses of $730 million, $366 million and $353 million for the years ended December 31, 2025, 2024 and 2023, respectively, are included in other non-interest expense.

(3)Primarily represents foreign currency translation adjustments for the year ended December 31, 2025 and 2024. Primarily represents foreign currency translation adjustments and the initial allowance for PCD loans for the year ended December 31, 2023. The initial allowance of PCD loans was $32 million for the year ended December 31, 2023.

(4)Charge-offs exclude $19.4 billion of Discover loans acquired in the second quarter of 2025 that were fully charged-off, with expected recoveries of $3.3 billion included as a benefit to the allowance for credit losses.

(5)Represents contractual rights to collect on recoveries of acquired Discover loans that are charged off.

(6)The provision for credit losses includes the initial allowance for credit losses of $8.8 billion for non-PCD loans acquired in the Transaction.

Credit Quality Indicator

The tables below present our Credit Card segment by delinquency status as of December 31, 2025 and 2024.

Table 4.3: Domestic and International Credit Card Delinquency Status

												December 31, 2025																		December 31, 2024
(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												$	250,332					$	1,600					$	251,932					$	148,112					$	453					$	148,565
30-59 days												2,925						90						3,015						1,944						29						1,973
60-89 days												2,233						75						2,308						1,483						20						1,503
Greater than 90 days												5,016						132						5,148						3,549						28						3,577
Total domestic credit card												$	260,506					$	1,897					$	262,403					$	155,088					$	530					$	155,618
International card businesses:
Current												7,260						44						7,304						6,533						37						6,570
30-59 days												112						5						117						102						5						107
60-89 days												80						3						83						69						3						72
Greater than 90 days												158						6						164						135						6						141
Total international card businesses												$	7,610					$	58					$	7,668					$	6,839					$	51					$	6,890

Table 4.4: Personal Loans Delinquency Status

						December 31, 2025
						Term Loans by Vintage Year
(Dollars in millions)						2025						2024						2023						2022						2021						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Personal loans—Delinquency status:
Current						$	4,050					$	2,727					$	1,614					$	658					$	208					$	68					$	9,325					$	0					$	0					$	9,325
30-59 days						14						22						22						10						3						1						72						0						0						72
60-89 days						8						17						16						8						3						1						53						0						0						53
Greater than 90 days						5						16						17						8						2						1						49						0						0						49
Total personal loans						$	4,077					$	2,782					$	1,669					$	684					$	216					$	71					$	9,499					$	0					$	0					$	9,499

The table below presents loans held for investment in our Consumer Banking segment loans held for investment by credit quality indicator as of December 31, 2025 and 2024. 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 4.5: Consumer Banking Portfolio by Vintage Year

						December 31, 2025
						Term Loans by Vintage Year
(Dollars in millions)						2025						2024						2023						2022						2021						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Auto—At origination FICO scores:(1)
Greater than 660						$	17,601					$	11,622					$	5,209					$	4,634					$	2,706					$	512					$	42,284					$	0					$	0					$	42,284
621-660						6,691						4,002						2,258						1,683						988						263						15,885						0						0						15,885
620 or below						12,319						5,947						3,213						2,115						1,290						547						25,431						0						0						25,431
Total auto						36,611						21,571						10,680						8,432						4,984						1,322						83,600						0						0						83,600
Retail banking—Delinquency status:
Current						103						126						69						78						40						411						827						341						3						1,171
30-59 days						1						0						0						0						0						1						2						10						0						12
60-89 days						0						0						0						0						0						1						1						1						0						2
Greater than 90 days						0						0						0						0						0						2						2						3						0						5
Total retail banking						104						126						69						78						40						415						832						355						3						1,190
Total consumer banking						$	36,715					$	21,697					$	10,749					$	8,510					$	5,024					$	1,737					$	84,432					$	355					$	3					$	84,790

    

						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

__________

(1)Amounts represent period-end loans held for investment in each credit score category. Auto loan 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 loans held for investment for our Commercial Banking segment by internal risk ratings as of December 31, 2025 and 2024. The internal risk rating status includes all past due loans, both performing and nonperforming.

Table 4.6: Commercial Banking Portfolio by Internal Risk Ratings

						December 31, 2025
						Term Loans by Vintage Year
(Dollars in millions)						2025						2024						2023						2022						2021						Prior						Total Term Loans						Revolving Loans						Revolving Loans Converted to Term						Total
Internal risk rating:(1)
Commercial and multifamily real estate
Noncriticized						$	2,288					$	1,516					$	2,034					$	3,178					$	1,357					$	4,573					$	14,946					$	16,352					$	140					$	31,438
Criticized performing						0						172						145						428						109						975						1,829						29						2						1,860
Criticized nonperforming						10						17						0						0						76						217						320						0						0						320
Total commercial and multifamily real estate						2,298						1,705						2,179						3,606						1,542						5,765						17,095						16,381						142						33,618
Commercial and industrial
Noncriticized						8,077						5,391						4,623						7,531						3,284						6,667						35,573						16,643						219						52,435
Criticized performing						3						162						185						391						726						309						1,776						541						0						2,317
Criticized nonperforming						12						71						12						158						246						196						695						162						35						892
Total commercial and industrial						8,092						5,624						4,820						8,080						4,256						7,172						38,044						17,346						254						55,644
Total commercial banking						$	10,390					$	7,329					$	6,999					$	11,686					$	5,798					$	12,937					$	55,139					$	33,727					$	396					$	89,262

						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

__________

(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, 2025.

Table 5.2: Gross Charge-Offs by Vintage Year

						Year Ended December 31, 2025
						Term Loans by Vintage Year
(Dollars in millions)						2025						2024						2023						2022						2021												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						$	14,084					$	282					$	14,366
Personal loans						$	20					$	102					$	110					$	52					$	17											$	4					$	305					N/A						N/A						305
International card business						N/A						N/A						N/A						N/A						N/A												N/A						N/A						529						16						545
Total credit card						20						102						110						52						17												4						305						14,613						298						15,216
Consumer Banking
Auto						229						714						600						550						330												159						2,582						0						0						2,582
Retail banking						0						0						0						0						0												1						1						79						0						80
Total consumer banking						229						714						600						550						330												160						2,583						79						0						2,662
Commercial Banking
Commercial and multifamily real estate						0						0						0						2						2												26						30						0						0						30
Commercial and industrial						0						0						0						130						26												42						198						60						0						258
Total commercial banking						0						0						0						132						28												68						228						60						0						288
Total						$	249					$	816					$	710					$	734					$	375											$	232					$	3,116					$	14,752					$	298					$	18,166

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, 2025, 2024 and 2023.

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

						Year Ended December 31,
(Dollars in millions)						2025						2024						2023
Estimated reimbursements from partners, beginning of period						$	1,010					$	2,014					$	1,558
Amounts due from partners for charged off loans						(657)						(904)						(980)
Change in estimated partner reimbursements that (increased) decreased provision for credit losses						750						(100)						1,436
Estimated reimbursements from partners, end of period						$	1,103					$	1,010					$	2,014

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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://www.xbrl.org/2009/role/commonPracticeRef
-Topic 326
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479319/326-20-50-13

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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://www.xbrl.org/2009/role/commonPracticeRef
-Topic 326
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479319/326-20-50-5

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