KeyBank 2015 Annual Report Download - page 106

Figure 38. Allocation of the Allowance for Loan and Lease Losses
2015 2014 2013
December 31,
dollars in millions
Total
Allowance
Percent of
Allowance
to Total
Allowance
Percent of
Loan Type
to Total
Loans
Total
Allowance
Percent of
Allowance
to Total
Allowance
Percent of
Loan Type
to Total
Loans
Total
Allowance
Percent of
Allowance
to Total
Allowance
Percent of
Loan Type
to Total
Loans
Commercial, financial and agricultural $ 450 56.5 % 52.2 % $ 391 49.2 % 48.8 % $ 362 42.7 % 45.8 %
Commercial real estate:
Commercial mortgage 134 16.8 13.3 148 18.7 14.0 165 19.4 14.2
Construction 25 3.2 1.7 28 3.5 1.9 32 3.8 2.0
Total commercial real estate loans 159 20.0 15.0 176 22.2 15.9 197 23.2 16.2
Commercial lease financing 47 5.9 6.7 56 7.1 7.4 62 7.3 8.4
Total commercial loans 656 82.4 73.9 623 78.5 72.1 621 73.2 70.4
Real estate — residential mortgage 18 2.3 3.7 23 2.9 3.9 37 4.4 4.0
Home equity:
Key Community Bank 55 6.9 16.9 66 8.3 18.1 84 9.9 19.0
Other 2.3 .4 5 .6 .5 11 1.3 .6
Total home equity loans 57 7.2 17.3 71 8.9 18.6 95 11.2 19.6
Consumer other — Key Community Bank 20 2.5 2.7 22 2.8 2.7 29 3.4 2.7
Credit cards 32 4.0 1.3 33 4.1 1.3 34 4.0 1.3
Consumer other:
Marine 12 1.5 1.0 21 2.7 1.3 29 3.4 1.9
Other 1.1 .1 1 .1 .1 3 .4 .1
Total consumer other 13 1.6 1.1 22 2.8 1.4 32 3.8 2.0
Total consumer loans 140 17.6 26.1 171 21.5 27.9 227 26.8 29.6
Total (a) $ 796 100.0 % 100.0 % $ 794 100.0 % 100.0 % $ 848 100.0 % 100.0 %
2012 2011
Total
Allowance
Percent of
Allowance
to Total
Allowance
Percent of
Loan Type
to Total
Loans
Total
Allowance
Percent of
Allowance
to Total
Allowance
Percent of
Loan Type
to Total
Loans
Commercial, financial and agricultural $ 327 36.8 % 44.0 % $ 334 33.2 % 39.1 %
Commercial real estate:
Commercial mortgage 198 22.3 14.6 272 27.1 16.2
Construction 41 4.6 1.9 63 6.3 2.7
Total commercial real estate loans 239 26.9 16.5 335 33.4 18.9
Commercial lease financing 55 6.2 9.3 78 7.8 12.2
Total commercial loans 621 69.9 69.8 747 74.4 70.2
Real estate — residential mortgage 30 3.4 4.1 37 3.7 3.9
Home equity:
Key Community Bank 105 11.8 18.6 103 10.2 18.6
Other 25 2.8 .8 29 2.9 1.1
Total home equity loans 130 14.6 19.4 132 13.1 19.7
Consumer other — Key Community Bank 38 4.3 2.5 41 4.1 2.4
Credit cards 26 2.9 1.4 — — —
Consumer other:
Marine 39 4.4 2.6 46 4.6 3.5
Other 4 .5 .2 1 .1 .3
Total consumer other 43 4.9 2.8 47 4.7 3.8
Total consumer loans 267 30.1 30.2 257 25.6 29.8
Total (a) $ 888 100.0 % 100.0 % $ 1,004 100.0 % 100.0 %
(a) Excludes allocations of the ALLL related to the discontinued operations of the education lending business in the amount of $28 million
at December 31, 2015, $29 million at December 31, 2014, $39 million at December 31, 2013, $55 million at December 31, 2012, and
$104 million at December 31, 2011.
Our provision for credit losses was $166 million for 2015, compared to $57 million for 2014. The increase in our
provision is due to the growth in our loan portfolio over the past twelve months as well as lower recoveries in
2015 compared to 2014. We continue to reduce our exposure in our higher-risk businesses, including the
residential properties portion of our construction loan portfolio, Marine/RV financing, and other selected leasing
portfolios through the sale of certain loans, payments from borrowers, or net loan charge-offs.
Asset quality on our oil and gas loan portfolio, which represents approximately 2% of total loans at
December 31, 2015, performed in-line with our expectations in 2015. Nonperforming loans in this sector
increased to .54% of our total oil and gas loan portfolio at December 31, 2015, up from .09% at December 31,
2014. In 2015, net loan charge-offs in this sector were .81% of our total oil and gas loan portfolio as a result of
commodity price declines that began in 2014. Our reserve for credit losses allocated to our oil and gas loan
exposure was 6% of the total oil and gas loan portfolio at December 31, 2015, and reflected the estimated impact
of current oil prices at that date.
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