Wells Fargo 2011 Annual Report Download - page 146

Download and view the complete annual report

Please find page 146 of the 2011 Wells Fargo 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.

Page out of 240

  • 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
  • 229
  • 230
  • 231
  • 232
  • 233
  • 234
  • 235
  • 236
  • 237
  • 238
  • 239
  • 240

Note 6: Loans and Allowance for Credit Losses (continued)
The allowance for credit losses consists of the allowance for loan losses and the allowance for unfunded credit commitments.
Changes in the allowance for credit losses were:
Year ended December 31,
(in millions)
2011
2010
2009
2008
2007
Balance, beginning of year
$
23,463
25,031
21,711
5,518
3,964
Provision for credit losses
7,899
15,753
21,668
15,979
4,939
Interest income on certain impaired loans (1)
(332)
(266)
-
-
-
Loan charge-offs:
Commercial:
Commercial and industrial
(1,598)
(2,775)
(3,365)
(1,653)
(629)
Real estate mortgage
(636)
(1,151)
(670)
(29)
(6)
Real estate construction
(351)
(1,189)
(1,063)
(178)
(14)
Lease financing
(38)
(120)
(229)
(65)
(33)
Foreign
(173)
(198)
(237)
(245)
(265)
Total commercial
(2,796)
(5,433)
(5,564)
(2,170)
(947)
Consumer:
Real estate 1-4 family first mortgage
(3,883)
(4,900)
(3,318)
(540)
(109)
Real estate 1-4 family junior lien mortgage
(3,763)
(4,934)
(4,812)
(2,204)
(648)
Credit card
(1,449)
(2,396)
(2,708)
(1,563)
(832)
Other revolving credit and installment
(1,724)
(2,437)
(3,423)
(2,300)
(1,913)
Total consumer
(10,819)
(14,667)
(14,261)
(6,607)
(3,502)
Total loan charge-offs
(13,615)
(20,100)
(19,825)
(8,777)
(4,449)
Loan recoveries:
Commercial:
Commercial and industrial
419
427
254
114
119
Real estate mortgage
143
68
33
5
8
Real estate construction
146
110
16
3
2
Lease financing
24
20
20
13
17
Foreign
45
53
40
49
65
Total commercial
777
678
363
184
211
Consumer:
Real estate 1-4 family first mortgage
405
522
185
37
22
Real estate 1-4 family junior lien mortgage
218
211
174
89
53
Credit card
251
218
180
147
120
Other revolving credit and installment
665
718
755
481
504
Total consumer
1,539
1,669
1,294
754
699
Total loan recoveries
2,316
2,347
1,657
938
910
Net loan charge-offs (2)
(11,299)
(17,753)
(18,168)
(7,839)
(3,539)
Allowances related to business combinations/other (3)
(63)
698
(180)
8,053
154
Balance, end of year
$
19,668
23,463
25,031
21,711
5,518
Components:
Allowance for loan losses
$
19,372
23,022
24,516
21,013
5,307
Allowance for unfunded credit commitments
296
441
515
698
211
Allowance for credit losses (4)
$
19,668
23,463
25,031
21,711
5,518
Net loan charge-offs as a percentage of average total loans (2)
1.49
%
2.30
2.21
1.97
1.03
Allowance for loan losses as a percentage of total loans (4)
2.52
3.04
3.13
2.43
1.39
Allowance for credit losses as a percentage of total loans (4)
2.56
3.10
3.20
2.51
1.44
(1) Certain impaired loans with an allowance calculated by discounting expected cash flows using the loan’s effective interest rate over the remaining life of the loan recognize
reductions in allowance as interest income.
(2) For PCI loans, charge-offs are only recorded to the extent that losses exceed the purchase accounting estimates.
(3) Includes $693 million for the year ended December 31, 2010, related to the adoption of consolidation accounting guidance on January 1, 2010.
(4) The allowance for credit losses includes $231 million, $298 million and $333 million at December 31, 2011, 2010 and 2009, respectively, related to PCI loans acquired from
Wachovia. Loans acquired from Wachovia are included in total loans net of related purchase accounting net write-downs.
144