US Bank 2012 Annual Report Download - page 104

The following table provides a summary of TDR loans that defaulted (fully or partially charged-off or became 90 days or more
past due) for the years ended December 31, that were modified as TDRs within 12 months previous to default.
(Dollars in Millions)
Number
of Loans
Amount
Defaulted
2012
Commercial ............................................................................................................. 859 $ 48
Commercial real estate .................................................................................................. 111 232
Residential mortgages ................................................................................................... 1,073 146
Credit card .............................................................................................................. 9,774 54
Other retail .............................................................................................................. 1,818 56
Total loans, excluding GNMA and covered loans ..................................................................... 13,635 536
Loans purchased from GNMA mortgage pools .......................................................................... 1,245 177
Covered loans ........................................................................................................... 68 97
Total loans ............................................................................................................ 14,948 $810
2011
Commercial ............................................................................................................. 665 $ 26
Commercial real estate .................................................................................................. 64 67
Residential mortgages ................................................................................................... 623 127
Credit card .............................................................................................................. 7,108 36
Other retail .............................................................................................................. 557 13
Total loans, excluding GNMA and covered loans ..................................................................... 9,017 269
Loans purchased from GNMA mortgage pools .......................................................................... 857 124
Covered loans ........................................................................................................... 11 26
Total loans ............................................................................................................ 9,885 $419
In addition to the defaults in the table above, for the year
ended December 31, 2012, the Company had an estimated
789 residential mortgage loans, home equity and second
mortgage loans, and loans purchased from GNMA mortgage
pools with aggregate outstanding balances of $121 million
where borrowers did not successfully complete the trial period
arrangement and therefore are no longer eligible for a
permanent modification under the applicable modification
program.
Covered Assets Covered assets represent loans and other assets acquired from the FDIC, subject to loss sharing agreements, and
include expected reimbursements from the FDIC. The carrying amount of the covered assets at December 31, consisted of
purchased impaired loans, purchased nonimpaired loans, and other assets as shown in the following table:
2012 2011
(Dollars in Millions)
Purchased
Impaired
Loans
Purchased
Nonimpaired
Loans
Other
Assets Total
Purchased
Impaired
Loans
Purchased
Nonimpaired
Loans
Other
Assets Total
Commercial loans .......................... $ – $ 143 $ – $ 143 $ 68 $ 137 $ – $ 205
Commercial real estate loans .............. 1,323 2,695 – 4,018 1,956 4,037 – 5,993
Residential mortgage loans ................ 3,978 1,109 – 5,087 3,830 1,360 – 5,190
Credit card loans ........................... – 5 – 5 – 6 – 6
Other retail loans ........................... – 775 – 775 – 867 – 867
Losses reimbursable by the FDIC (a) ....... – – 1,280 1,280 – – 2,526 2,526
Covered loans ........................... 5,301 4,727 1,280 11,308 5,854 6,407 2,526 14,787
Foreclosed real estate ...................... – – 197 197 – – 274 274
Total covered assets .................... $5,301 $4,727 $1,477 $11,505 $5,854 $6,407 $2,800 $15,061
(a) Relates to loss sharing agreements with remaining terms from 2 to 7 years.
At December 31, 2012, $82 million of the purchased
impaired loans included in covered loans were classified as
nonperforming assets, compared with $189 million at
December 31, 2011, because the expected cash flows are
primarily based on the liquidation of underlying collateral and
the timing and amount of the cash flows could not be
reasonably estimated. Interest income is recognized on other
purchased impaired loans through accretion of the difference
between the carrying amount of those loans and their
expected cash flows. The initial determination of the fair value
of the purchased loans includes the impact of expected credit
losses and, therefore, no allowance for credit losses is
recorded at the purchase date. To the extent credit
deterioration occurs after the date of acquisition, the
Company records an allowance for credit losses.
100 U.S. BANCORP