Fifth Third Bank 2014 Annual Report Download - page 62

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
60 Fifth Third Bancorp
value ascribed in the assessment of charge-offs and specific reserves.
In addition, the Bancorp applies incremental valuation adjustments
to older appraisals that relate to collateral dependent loans, which
can currently be up to 20-30% of the appraised value based on the
type of collateral. These incremental valuation adjustments generally
reflect the age of the most recent appraisal as well as collateral type.
Trends in collateral values, such as home price indices and recent
asset dispositions, are monitored in order to determine whether
changes to the appraisal adjustments are warranted. Other factors
such as local market conditions or location may also be considered
as necessary.
The Bancorp assesses all real estate and non-real estate
collateral securing a loan and considers all cross collateralized loans
in the calculation of the LTV ratio. The following tables provide
detail on the most recent LTV ratios for commercial mortgage loans
greater than $1 million, excluding impaired commercial mortgage
loans individually evaluated. The Bancorp does not typically
aggregate the LTV ratios for commercial mortgage loans less than
$1 million.
TABLE 34: COMMERCIAL MORTGAGE LOANS OUTSTANDING BY LTV, LOANS GREATER THAN $1 MILLION
A
s of December 31, 2014 ($ in millions) LTV > 100% LTV 80-100% LTV 80%
Commercial mortgage owner-occupied loans $148 248 1,982
Commercial mortgage nonowner-occupied loans 243 333 2,423
Total $391 581 4,405
TABLE 35: COMMERCIAL MORTGAGE LOANS OUTSTANDING BY LTV, LOANS GREATER THAN $1 MILLION
A
s of December 31, 2013 ($ in millions) LTV > 100% LTV 80-100% LTV 80%
Commercial mortgage owner-occupied loans $240 345 2,152
Commercial mortgage nonowner-occupied loans 274 353 1,798
Total $514 698 3,950