Bank of America 2013 Annual Report Download - page 105

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Table 64 Allowance for Credit Losses (continued)
(Dollars in millions) 2013 2012
Loan and allowance ratios:
Loans and leases outstanding at December 31 (5) $ 918,191 $ 898,817
Allowance for loan and lease losses as a percentage of total loans and leases and outstanding at December 31 (5) 1.90%2.69%
Consumer allowance for loan and lease losses as a percentage of total consumer loans and leases outstanding at December 31 (6) 2.53 3.81
Commercial allowance for loan and lease losses as a percentage of total commercial loans and leases outstanding at December 31 (7) 1.03 0.90
Average loans and leases outstanding (5) $ 909,127 $ 890,337
Net charge-offs as a percentage of average loans and leases outstanding (5, 8) 0.87%1.67%
Net charge-offs and PCI write-offs as a percentage of average loans and leases outstanding (5) 1.13 1.99
Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at December 31 (5, 9) 102 107
Ratio of the allowance for loan and lease losses at December 31 to net charge-offs (8) 2.21 1.62
Ratio of the allowance for loan and lease losses at December 31 to net charge-offs and PCI write-offs 1.70 1.36
Amounts included in the allowance for loan and lease losses that are excluded from nonperforming loans and leases at December 31 (10) $ 7,680 $ 12,021
Allowance for loan and lease losses as a percentage of total nonperforming loans and leases, excluding amounts included in the
allowance for loan and lease losses that are excluded from nonperforming loans and leases at December 31 (10) 57%54%
Loan and allowance ratios excluding PCI loans and the related valuation allowance: (11)
Allowance for loan and lease losses as a percentage of total loans and leases outstanding at December 31 (5) 1.67%2.14%
Consumer allowance for loan and lease losses as a percentage of total consumer loans and leases outstanding at December 31 (6) 2.17 2.95
Net charge-offs as a percentage of average loans and leases outstanding (5) 0.90 1.73
Allowance for loan and lease losses as a percentage of total nonperforming loans and leases at December 31 (5, 9) 87 82
Ratio of the allowance for loan and lease losses at December 31 to net charge-offs 1.89 1.25
(5) Outstanding loan and lease balances and ratios do not include loans accounted for under the fair value option, which were $10.0 billion and $9.0 billion at December 31, 2013 and 2012. Average
loans accounted for under the fair value option were $9.5 billion and $8.4 billion in 2013 and 2012.
(6) Excludes consumer loans accounted for under the fair value option of $2.2 billion and $1.0 billion at December 31, 2013 and 2012.
(7) Excludes commercial loans accounted for under the fair value option of $7.9 billion and $8.0 billion at December 31, 2013 and 2012.
(8) Net charge-offs exclude $2.3 billion and $2.8 billion of write-offs in the PCI loan portfolio in 2013 and 2012. These write-offs decreased the PCI valuation allowance included as part of the allowance
for loan and lease losses. For more information on PCI write-offs, see Consumer Portfolio Credit Risk Management – Purchased Credit-impaired Loan Portfolio on page 81.
(9) For more information on our definition of nonperforming loans, see pages 85 and 92.
(10) Primarily includes amounts allocated to U.S. credit card and unsecured consumer lending portfolios in CBB, PCI loans and the non-U.S. credit card portfolio in All Other.
(11) For more information on the PCI loan portfolio and the valuation allowance for PCI loans, see Note 4 – Outstanding Loans and Leases and Note 5 – Allowance for Credit Losses to the Consolidated
Financial Statements.
For reporting purposes, we allocate the allowance for credit losses across products. However, the allowance is generally available
to absorb any credit losses without restriction. Table 65 presents our allocation by product type.
Table 65 Allocation of the Allowance for Credit Losses by Product Type
December 31, 2013 December 31, 2012
(Dollars in millions) Amount
Percent of
Total
Percent of
Loans and
Leases
Outstanding (1) Amount
Percent of
Tota l
Percent of
Loans and
Leases
Outstanding (1)
Allowance for loan and lease losses
Residential mortgage $ 4,084 23.43% 1.65%$ 7,088 29.31% 2.80%
Home equity 4,434 25.44 4.73 7,845 32.45 7.26
U.S. credit card 3,930 22.55 4.26 4,718 19.51 4.97
Non-U.S. credit card 459 2.63 3.98 600 2.48 5.13
Direct/Indirect consumer 417 2.39 0.51 718 2.97 0.86
Other consumer 99 0.58 5.02 104 0.43 6.40
Total consumer 13,423 77.02 2.53 21,073 87.15 3.81
U.S. commercial (2) 2,394 13.74 1.06 1,885 7.80 0.90
Commercial real estate 917 5.26 1.91 846 3.50 2.19
Commercial lease financing 118 0.68 0.47 78 0.32 0.33
Non-U.S. commercial 576 3.30 0.64 297 1.23 0.40
Total commercial (3) 4,005 22.98 1.03 3,106 12.85 0.90
Allowance for loan and lease losses 17,428 100.00% 1.90 24,179 100.00% 2.69
Reserve for unfunded lending commitments 484 513
Allowance for credit losses (4) $ 17,912 $ 24,692
(1) Ratios are calculated as allowance for loan and lease losses as a percentage of loans and leases outstanding excluding loans accounted for under the fair value option. Consumer loans accounted
for under the fair value option included residential mortgage loans of $2.0 billion and $1.0 billion and home equity loans of $147 million and $0 at December 31, 2013 and 2012. Commercial loans
accounted for under the fair value option included U.S. commercial loans of $1.5 billion and $2.3 billion and non-U.S. commercial loans of $6.4 billion and $5.7 billion at December 31, 2013 and
2012.
(2) Includes allowance for loan and lease losses for U.S. small business commercial loans of $462 million and $642 million at December 31, 2013 and 2012.
(3) Includes allowance for loan and lease losses for impaired commercial loans of $277 million and $475 million at December 31, 2013 and 2012.
(4) Includes $2.5 billion and $5.5 billion of valuation allowance included as part of the allowance for credit losses related to PCI loans at December 31, 2013 and 2012.