SunTrust 2012 Annual Report Download - page 66
Download and view the complete annual report
Please find page 66 of the 2012 SunTrust annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1 -
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56 -
57 -
58 -
59 -
60 -
61 -
62 -
63 -
64 -
65 -
66 -
67 -
68 -
69 -
70 -
71 -
72 -
73 -
74 -
75 -
76 -
77
-
78
-
79
-
80
-
81
-
82
-
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94
-
95
-
96
-
97
-
98
-
99
-
100
-
101
-
102
-
103
-
104
-
105
-
106
-
107
-
108
-
109
-
110
-
111
-
112
-
113
-
114
-
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139
-
140
-
141
-
142
-
143
-
144
-
145
-
146
-
147
-
148
-
149
-
150
-
151
-
152
-
153
-
154
-
155
-
156
-
157
-
158
-
159
-
160
-
161
-
162
-
163
-
164
-
165
-
166
-
167
-
168
-
169
-
170
-
171
-
172
-
173
-
174
-
175
-
176
-
177
-
178
-
179
-
180
-
181
-
182
-
183
-
184
-
185
-
186
-
187
-
188
-
189
-
190
-
191
-
192
-
193
-
194
-
195
-
196
-
197
-
198
-
199
-
200
-
201
-
202
-
203
-
204
-
205
-
206
-
207
-
208
-
209
-
210
-
211
-
212
-
213
-
214
-
215
-
216
-
217
-
218
-
219
-
220
-
221
-
222
-
223
-
224
-
225
-
226
-
227
-
228
 |
 |
50
Charge-offs
Net charge-offs declined by $359 million, or 18%, compared with 2011. Included in 2012 net charge-offs were $226 million
in net charge-offs associated with sales of nonperforming residential mortgage and commercial real estate loans, which were
completed primarily in the second half of 2012, as well as the recognition of $65 million in incremental charge-offs related
to our second lien policy change and $79 million related to our policy change for loans discharged in Chapter 7 bankruptcy.
Prior to our second lien policy change, we charged-off second lien loans at 180 days past due. During the year we implemented
a change in credit policy to recognize the charge-off at 120 days past due. Additionally, we changed our policy with respect
to residential loans discharged in Chapter 7 bankruptcy that had have not been reaffirmed by the borrower even when the
borrower was current on their contractually due payments. This change in policy was in response to recent regulatory guidance.
These increases to charge-offs were offset by improvements in credit quality driving lower net charge-offs. Net charge-offs
have trended favorably for the last several quarters, and we expect that overall trend to continue in the coming quarters. The
ratio of net charge-offs to average loans was 1.37% during 2012, a reduction of 38 basis points from 2011. Refer to Note 1,
"Significant Accounting Policies," to the Consolidated Financial Statements in this Form 10-K for additional policy
information.
Provision for Credit Losses
The total provision for credit losses includes the provision for loan losses, as well as the provision for unfunded commitments.
The provision for loan losses is the result of a detailed analysis performed to estimate an appropriate and adequate ALLL. As
of December 31, 2012, the provision for loan losses was down $125 million, or 8%, compared to December 31, 2011. The
change in the provision for loan losses was largely attributable to improvements in credit quality trends and lower net charge-
offs during 2012.