PNC Bank 2013 Annual Report Download - page 245

N ONPERFORMING A SSETS AND R ELATED I NFORMATION
December 31 – dollars in millions 2013 2012 2011 2010 2009
Nonperforming loans
Commercial $ 457 $ 590 $ 899 $1,253 $1,806
Commercial real estate 518 807 1,345 1,835 2,140
Equipment lease financing 5 13 22 77 130
Total commercial lending 980 1,410 2,266 3,165 4,076
Consumer lending (a)
Home equity (b) (c) 1,139 951 529 448 356
Residential real estate (b) 904 845 726 818 1,203
Credit card (d) 4 5 8
Other consumer (b) 61 43 31 35 36
Total consumer lending (e) 2,108 1,844 1,294 1,301 1,595
Total nonperforming loans (f) 3,088 3,254 3,560 4,466 5,671
OREO and foreclosed assets
Other real estate owned (OREO) (g) 360 507 561 589 484
Foreclosed and other assets 9 33 35 68 49
Total OREO and foreclosed assets 369 540 596 657 533
Total nonperforming assets $3,457 $3,794 $4,156 $5,123 $6,204
Nonperforming loans to total loans 1.58% 1.75% 2.24% 2.97% 3.60%
Nonperforming assets to total loans, OREO and foreclosed assets 1.76 2.04 2.60 3.39 3.92
Nonperforming assets to total assets 1.08 1.24 1.53 1.94 2.30
Interest on nonperforming loans
Computed on original terms $ 163 $ 212 $ 278 $ 329 $ 302
Recognized prior to nonperforming status 30 30 47 53 90
Past due loans
Accruing loans past due 90 days or more (h) $1,491 $2,351 $2,973 $2,709 $2,698
As a percentage of total loans .76% 1.26% 1.87% 1.80% 1.71%
Past due loans held for sale
Accruing loans held for sale past due 90 days or more (i) $ 4 $ 38 $ 49 $ 65 $ 72
As a percentage of total loans held for sale .18% 1.03% 1.67% 1.86% 2.84%
(a) Excludes most consumer loans and lines of credit, not secured by residential real estate, which are charged off after 120 to 180 days past due and are not placed on nonperforming
status.
(b) Pursuant to alignment with interagency supervisory guidance on practices for loans and lines of credit related to consumer lending in the first quarter of 2013, nonperforming home
equity loans increased $214 million, nonperforming residential mortgage loans increased $187 million and nonperforming other consumer loans increased $25 million. Charge-offs
were taken on these loans where the fair value less costs to sell the collateral was less than the recorded investment of the loan and were $134 million.
(c) In the first quarter of 2012, we adopted a policy stating that Home equity loans past due 90 days or more would be placed on nonaccrual status. Prior policy required that these loans
be past due 180 days before being placed on nonaccrual status.
(d) Effective in the second quarter 2011, the commercial nonaccrual policy was applied to certain small business credit card balances. This change resulted in loans being placed on
nonaccrual status when they become 90 days or more past due. We continue to charge off these loans at 180 days past due.
(e) Pursuant to regulatory guidance, issued in the third quarter of 2012, nonperforming consumer loans, primarily home equity and residential mortgage, increased $288 million in 2012
related to changes in treatment of certain loans classified as TDRs, net of charge-offs, resulting from bankruptcy where no formal reaffirmation was provided by the borrower and
therefore a concession has been granted based upon discharge from personal liability. Charge-offs have been taken where the fair value less costs to sell the collateral was less than the
recorded investment of the loan and were $128.1 million.
(f) Includes TDRs of $1,511 million at December 31, 2013, $1,589 million at December 31, 2012, $1,141 million at December 31, 2011, $784 million at December 31, 2010 and $440
million at December 31, 2009, respectively. Nonperforming loans exclude certain government insured or guaranteed loans, loans held for sale, loans accounted for under the fair value
option and purchased impaired loans.
(g) OREO excludes $245 million, $380 million, $280 million, $178 million and $112 million at December 31, 2013, December 31, 2012, December 31, 2011, December 31, 2010 and
December 31, 2009, respectively, related to residential real estate that was acquired by us upon foreclosure of serviced loans because they are insured by the Federal Housing
Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA).
(h) Amounts include certain government insured or guaranteed consumer loans totaling $995 million, $2,236 million, $2,474 million, $2,167 million and $1,814 million at December 31,
2013, December 31, 2012, December 31, 2011, December 31, 2010 and December 31, 2009, respectively. Past due loan amounts exclude purchased impaired loans as they are
considered current loans due to the accretion of interest income.
(i) Amounts include certain government insured or guaranteed consumer loans held for sale totaling $4 million, zero, $15 million, $22 million and $27 million at December 31,
2013, December 31, 2012, December 31, 2011, December 31, 2010 and December 31, 2009, respectively.
The PNC Financial Services Group, Inc. – Form 10-K 227