SunTrust 2014 Annual Report Download - page 129
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Notes to Consolidated Financial Statements, continued
106
(Dollars in millions) 2014 2013
High LTV residential mortgages:
Interest only LHFI with no MI 1, 2 $873 $1,128
Interest only LHFI with MI 13,180 4,403
Total interest only residential mortgages 4,053 5,531
Amortizing loans with no MI 27,368 6,918
Total high LTV residential mortgages $11,421 $12,449
1 Primarily with an initial 10 year interest only period.
2 Comprised of first liens with combined original LTV ratios in excess of 80% and/or
second liens.
Despite changes in underwriting guidelines that have
curtailed the origination of high LTV loans, the balances of such
loans have increased due to lending to high credit quality clients.
NOTE 7 - ALLOWANCE FOR CREDIT LOSSES
The allowance for credit losses consists of the ALLL and the reserve for unfunded commitments. Activity in the allowance for credit
losses is summarized in the table below:
Year Ended December 31
(Dollars in millions) 2014 2013 2012
Balance at beginning of period $2,094 $2,219 $2,505
Provision for loan losses 338 548 1,398
(Benefit)/provision for unfunded commitments 45 (3)
Loan charge-offs (607) (869) (1,907)
Loan recoveries 162 191 226
Balance at end of period $1,991 $2,094 $2,219
Components:
ALLL $1,937 $2,044 $2,174
Unfunded commitments reserve154 50 45
Allowance for credit losses $1,991 $2,094 $2,219
1 The unfunded commitments reserve is recorded in other liabilities in the Consolidated Balance Sheets.
Activity in the ALLL by loan segment for the years ended December 31 is presented in the tables below:
2014
(Dollars in millions) Commercial Residential Consumer Total
Balance at beginning of period $946 $930 $168 $2,044
Provision for loan losses 111 126 101 338
Loan charge-offs (128) (344) (135) (607)
Loan recoveries 57 65 40 162
Balance at end of period $986 $777 $174 $1,937
2013
(Dollars in millions) Commercial Residential Consumer Total
Balance at beginning of period $902 $1,131 $141 $2,174
Provision for loan losses 197 243 108 548
Loan charge-offs (219) (531) (119) (869)
Loan recoveries 66 87 38 191
Balance at end of period $946 $930 $168 $2,044