v3.25.2
Loans and Allowance for Credit Losses
 6 Months Ended
Jun. 30, 2025
Receivables [Abstract]  
Loans and Allowance for Credit Losses
NOTE 4Loans and Allowance for Credit Losses
The composition of the loan portfolio, by class and underlying specific portfolio type, was as follows:
June 30, 2025December 31, 2024
(Dollars in Millions)AmountPercent of Total AmountPercent of Total
Commercial
Commercial$143,135 37.7 %$135,254 35.6 %
Lease financing4,281 1.1 4,230 1.1 
Total commercial147,416 38.8 139,484 36.7 
Commercial Real Estate
Commercial mortgages38,144 10.0 38,619 10.2 
Construction and development10,037 2.7 10,240 2.7 
Total commercial real estate48,181 12.7 48,859 12.9 
Residential Mortgages
Residential mortgages108,913 28.6 112,806 29.7 
Home equity loans, first liens5,562 1.5 6,007 1.6 
Total residential mortgages114,475 30.1 118,813 31.3 
Credit Card30,023 7.9 30,350 8.0 
Other Retail
Retail leasing3,816 1.0 4,040 1.0 
Home equity and second mortgages13,761 3.6 13,565 3.6 
Revolving credit4,062 1.1 3,747 1.0 
Installment14,220 3.7 14,373 3.8 
Automobile4,289 1.1 6,601 1.7 
Total other retail40,148 10.5 42,326 11.1 
Total loans$380,243 100.0 %$379,832 100.0 %
The Company had loans of $128.8 billion at June 30, 2025, and $127.6 billion at December 31, 2024, pledged at the FHLB, and loans of $90.3 billion at June 30, 2025, and $85.1 billion at December 31, 2024, pledged at the Federal Reserve Bank.
Originated loans are reported at the principal amount outstanding, net of unearned interest and deferred fees and costs, and any partial charge-offs recorded. Purchased loans are recorded at fair value at the date of purchase. Net unearned interest and deferred fees and costs on originated loans and unamortized premiums and discounts on purchased loans amounted to $2.1 billion and $2.5 billion at June 30, 2025 and December 31, 2024, respectively. The Company evaluates purchased loans for more-than-insignificant deterioration at the date of purchase in accordance with applicable authoritative accounting guidance. Purchased loans that have experienced more-than-insignificant deterioration from origination are considered purchased credit deteriorated loans. All other purchased loans are considered non-purchased credit deteriorated loans.
Allowance for Credit Losses The allowance for credit losses is established for current expected credit losses on the Company’s loan and lease portfolio, including unfunded credit commitments. The allowance considers expected losses for the remaining lives of the applicable assets, inclusive of expected recoveries. The allowance for credit losses is increased through provisions charged to earnings and reduced by net charge-offs. Management evaluates the appropriateness of the allowance for credit losses on a quarterly basis.
Multiple economic scenarios are considered over a three-year reasonable and supportable forecast period, which includes increasing consideration of historical loss experience over years two and three. These economic scenarios are constructed with interrelated projections of multiple economic variables, and loss estimates are produced that consider the historical correlation of those economic variables with credit losses. After the forecast period, the Company fully reverts to long-term historical loss experience, adjusted for prepayments and characteristics of the current loan and lease portfolio, to estimate losses over the remaining life of the portfolio. The economic scenarios are updated at least quarterly and are designed to provide a range of reasonable estimates, both better and worse than current expectations. Scenarios are weighted based on the Company’s expectation of economic conditions for the foreseeable future and reflect significant judgment and consideration of economic forecast uncertainty. Final loss estimates also consider factors affecting credit losses not reflected in the scenarios, due to the unique aspects of current conditions and expectations. These factors may include, but are not limited to, loan servicing practices, regulatory guidance, and/or fiscal and monetary policy actions.
The allowance recorded for credit losses utilizes forward-looking expected loss models to consider a variety of factors affecting lifetime credit losses. These factors include, but are not limited to, macroeconomic variables such as unemployment rates, real
estate prices, gross domestic product levels, inflation, interest rates and corporate bonds spreads, as well as loan and borrower characteristics, such as internal risk ratings on commercial loans and consumer credit scores, delinquency status, collateral type and available valuation information, consideration of end-of-term losses on lease residuals, and the remaining term of the loan, adjusted for expected prepayments. For each loan portfolio, including those loans modified under various loan modification programs, model estimates are adjusted as necessary to consider any relevant changes in portfolio composition, lending policies, underwriting standards, risk management practices, economic conditions or other factors that would affect the accuracy of the model. Expected credit loss estimates also include consideration of expected cash recoveries on loans previously charged-off or expected recoveries on collateral dependent loans where recovery is expected through sale of the collateral at fair value less selling costs. Where loans do not exhibit similar risk characteristics, an individual analysis is performed to consider expected credit losses. For loans and leases that do not share similar risk characteristics with a pool of loans, the Company establishes individually assessed reserves. Reserves for individual commercial nonperforming loans greater than $5 million in the commercial lending segment are analyzed utilizing expected cash flows discounted using the original effective interest rate, the observable market price of the loan, or the fair value of the collateral, less selling costs, for collateral-dependent loans as appropriate. For smaller commercial loans collectively evaluated for impairment, historical loss experience is also incorporated into the allowance methodology applied to this category of loans.
The Company’s methodology for determining the appropriate allowance for credit losses also considers the imprecision inherent in the methodologies used and allocated to the various loan portfolios. As a result, amounts determined under the methodologies described above are adjusted by management to consider the potential impact of other qualitative factors not captured in the quantitative model adjustments which include, but are not limited to, the following: model imprecision, imprecision in economic scenario assumptions, and emerging risks related to either changes in the environment that are affecting specific portfolios, or changes in portfolio concentrations over time that may affect model performance. The consideration of these items results in adjustments to allowance amounts included in the Company’s allowance for credit losses for each loan portfolio.
The Company also assesses the credit risk associated with off-balance sheet loan commitments, letters of credit, investment securities and derivatives. Credit risk associated with derivatives is reflected in the fair values recorded for those positions. The liability for off-balance sheet credit exposure related to loan commitments and other credit guarantees is included in other liabilities. Because business processes and credit risks associated with unfunded credit commitments are essentially the same as for loans, the Company utilizes similar processes to estimate its liability for unfunded credit commitments.
The results of the analysis are evaluated quarterly to confirm the estimates are appropriate for each specific loan portfolio, as well as the entire loan portfolio, as the entire allowance for credit losses is available for the entire loan portfolio.
Activity in the allowance for credit losses by portfolio class was as follows:
Three Months Ended June 30
(Dollars in Millions)		Commercial
Commercial Real Estate
Residential Mortgages
Credit Card
Other Retail
Total Loans
2025
Balance at beginning of period$2,212 $1,432 $789 $2,644 $838 $7,915 
Add
Provision for credit losses155 9 (33)338 32 501 
Deduct
Loans charged-off155 74 4 373 77 683 
Less recoveries of loans charged-off(27)(17)(5)(56)(24)(129)
Net loan charge-offs (recoveries)128 57 (1)317 53 554 
Balance at end of period$2,239 $1,384 $757 $2,665 $817 $7,862 
2024
Balance at beginning of period$2,159 $1,629 $843 $2,425 $848 $7,904 
Add
Provision for credit losses164 3 (11)388 24 568 
Deduct
Loans charged-off180 38 3 358 73 652 
Less recoveries of loans charged-off(37)(2)(7)(43)(25)(114)
Net loan charge-offs (recoveries)143 36 (4)315 48 538 
Balance at end of period$2,180 $1,596 $836 $2,498 $824 $7,934 
Six Months Ended June 30
(Dollars in Millions)		Commercial
Commercial Real Estate
Residential Mortgages
Credit Card
Other Retail
Total Loans
2025
Balance at beginning of period$2,175 $1,508 $783 $2,640 $819 $7,925 
Add
Provision for credit losses355 (71)(27)667 114 1,038 
Deduct
Loans charged-off342 99 8 759 165 1,373 
Less recoveries of loans charged-off(51)(46)(9)(117)(49)(272)
Net loan charge-offs (recoveries)291 53 (1)642 116 1,101 
Balance at end of period$2,239 $1,384 $757 $2,665 $817 $7,862 
2024
Balance at beginning of period$2,119 $1,620 $827 $2,403 $870 $7,839 
Add
Provision for credit losses320 33 5 706 57 1,121 
Deduct
Loans charged-off319 72 7 695 154 1,247 
Less recoveries of loans charged-off(60)(15)(11)(84)(51)(221)
Net loan charge-offs (recoveries)259 57 (4)611 103 1,026 
Balance at end of period$2,180 $1,596 $836 $2,498 $824 $7,934 
The decrease in the allowance for credit losses at June 30, 2025, compared with December 31, 2024, was primarily driven by the impact of loan portfolio sales during the second quarter of 2025, along with improved credit quality and portfolio mix.
The following table provides a summary of loans charged-off by portfolio class and year of origination:
Three Months Ended June 30
(Dollars in Millions)		CommercialCommercial
Real Estate		Residential Mortgages
Credit Card(a)
Other RetailTotal Loans
2025
Originated in 2025$10 $— $— $— $— $10 
Originated in 202427 25 — — 12 64 
Originated in 20239 7 — — 14 30 
Originated in 20227 35 1 — 11 54 
Originated in 20215 — 1 — 10 16 
Originated prior to 202116 1 2 — 8 27 
Revolving81 6 — 373 22 482 
Total charge-offs$155 $74 $4 $373 $77 $683 
2024
Originated in 2024$3 $36 $— $— $— $39 
Originated in 202326 2 — — 11 39 
Originated in 202266 — 1 — 14 81 
Originated in 20217 — — — 10 17 
Originated in 20202 — — — 5 7 
Originated prior to 202011 — 2 — 8 21 
Revolving65 — — 358 25 448 
Total charge-offs$180 $38 $3 $358 $73 $652 
Six Months Ended June 30
(Dollars in Millions)		CommercialCommercial Real EstateResidential Mortgages
Credit Card(a)
Other RetailTotal Loans
2025
Originated in 2025$20 $— $— $— $— $20 
Originated in 202458 31 — — 23 112 
Originated in 202338 21 — — 29 88 
Originated in 202239 39 1 — 24 103 
Originated in 20219 1 1 — 25 36 
Originated prior to 202125 1 6 — 17 49 
Revolving153 6 — 759 47 965 
Total charge-offs$342 $99 $8 $759 $165 $1,373 
2024
Originated in 2024$3 $41 $— $— $2 $46 
Originated in 202352 6 — — 21 79 
Originated in 202284 24 1 — 28 137 
Originated in 202115 — — — 21 36 
Originated in 20206 — — — 13 19 
Originated prior to 202021 1 6 — 19 47 
Revolving138 — — 695 50 883 
Total charge-offs$319 $72 $7 $695 $154 $1,247 
Note: Year of origination is based on the origination date of a loan, or for existing loans the date when the maturity date, pricing or commitment amount is amended. Predominantly all current year and near term loan origination years for gross charge-offs relate to existing loans that have had recent maturity date, pricing or commitment amount amendments.
(a)Predominantly all credit card loans are considered revolving loans. Includes an immaterial amount of charge-offs related to revolving converted to term loans.
Credit Quality The credit quality of the Company’s loan portfolios is assessed as a function of net credit losses, levels of nonperforming assets and delinquencies, and credit quality ratings as defined by the Company.
For all loan portfolio classes, loans are considered past due based on the number of days delinquent except for monthly amortizing loans which are classified delinquent based upon the number of contractually required payments not made (for example, two missed payments is considered 30 days delinquent). When a loan is placed on nonaccrual status, unpaid accrued interest is reversed, reducing interest income in the current period.
Commercial lending segment loans are generally placed on nonaccrual status when the collection of principal and interest has become 90 days past due or is otherwise considered doubtful. Commercial lending segment loans are generally fully charged down if unsecured by collateral or partially charged down to the fair value of the collateral securing the loan, less costs to sell, when the loan is placed on nonaccrual.
Consumer lending segment loans are generally charged-off at a specific number of days or payments past due. Residential mortgages and other retail loans secured by 1-4 family properties are generally charged down to the fair value of the collateral securing the loan, less costs to sell, at 180 days past due. Residential mortgage loans and lines in a first lien position are placed on nonaccrual status in instances where a partial charge-off occurs unless the loan is well secured and in the process of collection. Residential mortgage loans and lines in a junior lien position secured by 1-4 family properties are placed on nonaccrual status at 120 days past due or when they are behind a first lien that has become 180 days or greater past due or placed on nonaccrual status. Any secured consumer lending segment loan whose borrower has had debt discharged through bankruptcy, for which the loan amount exceeds the fair value of the collateral, is charged down to the fair value of the related collateral and the remaining balance is placed on nonaccrual status. Credit card loans continue to accrue interest until the account is charged-off. Credit cards are charged-off at 180 days past due. Other retail loans not secured by 1-4 family properties are charged-off at 120 days past due, and revolving consumer lines are charged-off at 180 days past due. Similar to credit cards, other retail loans are generally not placed on nonaccrual status because of the relative short period of time to charge-off. Certain retail customers having financial difficulties may have the terms of their credit card and other loan agreements modified to require only principal payments and, as such, are reported as nonaccrual.
For all loan classes, interest payments received on nonaccrual loans are generally recorded as a reduction to a loan’s carrying amount while a loan is on nonaccrual and are recognized as interest income upon payoff of the loan. However, interest income may be recognized for interest payments if the remaining carrying amount of the loan is believed to be collectible. In certain circumstances, loans in any class may be restored to accrual status, such as when a loan has demonstrated sustained repayment performance or no amounts are past due and prospects for future payment are no longer in doubt; or when the loan becomes well secured and is in the process of collection. Loans where there has been a partial charge-off may be returned to accrual status if all principal and interest (including amounts previously charged-off) is expected to be collected and the loan is current.
The following table provides a summary of loans by portfolio class, including the delinquency status of those that continue to accrue interest, and those that are nonperforming:
Accruing
(Dollars in Millions)Current
30-89 Days
Past Due
90 Days or
More Past Due
Nonperforming(b)
Total
June 30, 2025
Commercial$146,424 $325 $92 $575 $147,416 
Commercial real estate47,172 113 133 763 48,181 
Residential mortgages(a)
113,841 171 318 145 114,475 
Credit card29,280 371 372 — 30,023 
Other retail39,770 173 51 154 40,148 
Total loans$376,487 $1,153 $966 $1,637 $380,243 
December 31, 2024
Commercial$138,362 $356 $96 $670 $139,484 
Commercial real estate47,948 78 9 824 48,859 
Residential mortgages(a)
118,267 188 206 152 118,813 
Credit card29,487 428 435 — 30,350 
Other retail41,886 229 64 147 42,326 
Total loans$375,950 $1,279 $810 $1,793 $379,832 
(a)At June 30, 2025, $558 million of loans 30–89 days past due and $2.2 billion of loans 90 days or more past due purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose repayments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, were classified as current, compared with $660 million and $2.3 billion at December 31, 2024, respectively.
(b)Substantially all nonperforming loans at June 30, 2025 and December 31, 2024, had an associated allowance for credit losses. The Company recognized interest income on nonperforming loans of $6 million and $6 million for the three months ended June 30, 2025 and 2024, respectively, and $10 million and $11 million for the six months ended June 30, 2025 and 2024, respectively
The amount of foreclosed residential real estate held by the Company, and included in OREO, was $21 million at both June 30, 2025 and December 31, 2024. These amounts excluded $55 million and $46 million at June 30, 2025 and December 31, 2024, respectively, of foreclosed residential real estate related to mortgage loans whose payments are primarily insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs. In addition, the amount of residential mortgage loans secured by residential real estate in the process of foreclosure at June 30, 2025 and December 31, 2024, was $553 million and $576 million, respectively, of which $340 million and $354 million, respectively, related to loans purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose repayments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs.
The Company classifies its loan portfolio classes using internal credit quality ratings on a quarterly basis. These ratings include pass, special mention and classified, and are an important part of the Company’s overall credit risk management process and evaluation of the allowance for credit losses. Loans with a pass rating represent those loans not classified on the Company’s rating scale for problem credits, as minimal credit risk has been identified. Special mention loans are those loans that have a potential weakness deserving management’s close attention. Classified loans are those loans where a well-defined weakness has been identified that may put full collection of contractual cash flows at risk. It is possible that others, given the same information, may reach different reasonable conclusions regarding the credit quality rating classification of specific loans.
The following table provides a summary of loans by portfolio class and the Company’s internal credit quality rating:
June 30, 2025December 31, 2024
CriticizedCriticized
(Dollars in Millions)Pass
Special
Mention
Classified(a)
Total
Criticized
TotalPass
Special
Mention
Classified(a)
Total
Criticized
Total
Commercial
Originated in 2025$36,672 $252 $290 $542 $37,214 $— $— $— $— $— 
Originated in 202441,949 311 868 1,179 43,128 57,578 503 1,034 1,537 59,115 
Originated in 202311,973 128 455 583 12,556 19,128 173 564 737 19,865 
Originated in 202214,692 39 426 465 15,157 19,718 231 370 601 20,319 
Originated in 20213,710 5 34 39 3,749 4,677 60 92 152 4,829 
Originated prior to 20214,963 119 200 319 5,282 6,812 76 143 219 7,031 
Revolving(b)
29,454 413 463 876 30,330 27,344 169 812 981 28,325 
Total commercial143,413 1,267 2,736 4,003 147,416 135,257 1,212 3,015 4,227 139,484 
Commercial real estate
Originated in 20256,934 191 580 771 7,705 — — — — — 
Originated in 20247,722 121 907 1,028 8,750 9,652 261 1,772 2,033 11,685 
Originated in 20234,470 65 641 706 5,176 5,213 42 760 802 6,015 
Originated in 20227,465 313 880 1,193 8,658 9,047 661 913 1,574 10,621 
Originated in 20215,388 62 166 228 5,616 6,515 100 196 296 6,811 
Originated prior to 20219,461 250 585 835 10,296 10,822 148 608 756 11,578 
Revolving1,931 6 38 44 1,975 2,078 — 68 68 2,146 
Revolving converted to term5 — — — 5 3 — — — 3 
Total commercial real estate43,376 1,008 3,797 4,805 48,181 43,330 1,212 4,317 5,529 48,859 
Residential mortgages(c)
Originated in 20255,085 — — — 5,085 — — — — — 
Originated in 20249,200 — 8 8 9,208 10,291 — — — 10,291 
Originated in 20238,342 — 22 22 8,364 8,764 — 11 11 8,775 
Originated in 202225,243 — 62 62 25,305 28,484 — 43 43 28,527 
Originated in 202131,776 — 68 68 31,844 34,694 — 35 35 34,729 
Originated prior to 202134,359 — 310 310 34,669 36,211 — 280 280 36,491 
Total residential mortgages114,005 — 470 470 114,475 118,444 — 369 369 118,813 
Credit card(d)
29,651 — 372 372 30,023 29,915 — 435 435 30,350 
Other retail
Originated in 20253,050 — 1 1 3,051 — — — — — 
Originated in 20245,769 — 8 8 5,777 7,398 — 3 3 7,401 
Originated in 20233,273 — 10 10 3,283 3,966 — 9 9 3,975 
Originated in 20223,283 — 11 11 3,294 4,085 — 11 11 4,096 
Originated in 20215,018 — 10 10 5,028 6,537 — 14 14 6,551 
Originated prior to 20214,624 — 19 19 4,643 5,543 — 21 21 5,564 
Revolving14,151 — 114 114 14,265 13,846 — 120 120 13,966 
Revolving converted to term767 — 40 40 807 731 — 42 42 773 
Total other retail39,935 — 213 213 40,148 42,106 — 220 220 42,326 
Total loans$370,380 $2,275 $7,588 $9,863 $380,243 $369,052 $2,424 $8,356 $10,780 $379,832 
Total outstanding commitments$789,563 $3,118 $9,644 $12,762 $802,325 $778,155 $3,875 $10,441 $14,316 $792,471 
Note: Year of origination is based on the origination date of a loan, or for existing loans the date when the maturity date, pricing or commitment amount is amended. Predominately all current year and nearer term loan origination years for criticized loans relate to existing loans that have had recent maturity date, pricing or commitment amount amendments.
(a)Classified rating on consumer loans primarily based on delinquency status.
(b)Includes an immaterial amount of revolving converted to term loans.
(c)At June 30, 2025, $2.2 billion of GNMA loans 90 days or more past due and $1.4 billion of modified GNMA loans whose repayments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs were classified with a pass rating, compared with $2.3 billion and $1.4 billion at December 31, 2024, respectively.
(d)Predominately all credit card loans are considered revolving loans. Includes an immaterial amount of revolving converted to term loans.
Loan Modifications In certain circumstances, the Company may modify the terms of a loan to maximize the collection of amounts due when a borrower is experiencing financial difficulties or is expected to experience difficulties in the near-term. The Company recognizes interest on modified loans if full collection of contractual principal and interest is expected. The effects of modifications on credit loss expectations, such as improved payment capacity, longer expected lives and other factors, are considered when measuring the allowance for credit losses. Modification performance, including redefault rates and how these compare to historical losses, are also considered. Modifications generally do not result in significant changes to the Company’s allowance for credit losses.
The following table provides a summary of period-end balances of loans modified during the periods presented, by portfolio class and modification granted:
Three Months Ended June 30
(Dollars in Millions)
Interest Rate
Reduction
Payment
Delay
Term
Extension
Multiple Modifications(a)
Total
Modifications
Percent of
Class Total
2025
Commercial$24 $— $158 $69 $251 .2 %
Commercial real estate— — 283 — 283 .6 
Residential mortgages(b)
— 77 3 12 92 .1 
Credit card123 — — — 123 .4 
Other retail2 4 25 3 34 .1 
Total loans, excluding loans purchased from GNMA mortgage pools149 81 469 84 783 .2 
Loans purchased from GNMA mortgage pools(b)
— 375138172685.6 
Total loans$149 $456 $607 $256 $1,468 .4 %
2024
Commercial$23 $— $253 $— $276 .2 %
Commercial real estate78 — 391 7 476 .9 
Residential mortgages(b)
— 9 7 6 22 — 
Credit card116 — — — 116 .4 
Other retail2 — 33 1 36 .1 
Total loans, excluding loans purchased from GNMA mortgage pools219 9 684 14 926 .2 
Loans purchased from GNMA mortgage pools(b)
— 474 109 122 705 .6 
Total loans$219 $483 $793 $136 $1,631 .4 %
Six Months Ended June 30
(Dollars in Millions)		Interest Rate ReductionPayment DelayTerm Extension
Multiple Modifications(a)
Total ModificationsPercent of Class Total
2025
Commercial$46 $2 $260 $87 $395 .3 %
Commercial real estate— — 451 2 453 .9 
Residential mortgages(b)
— 293 5 17 315 .3 
Credit card241 3 — — 244 .8 
Other retail4 5 50 7 66 .2 
Total loans, excluding loans purchased from GNMA mortgage pools291 303 766 113 1,473 .4 
Loans purchased from GNMA mortgage pools(b)
— 696 233 284 1,213 1.1 
Total loans$291 $999 $999 $397 $2,686 .7 %
2024
Commercial$44 $— $452 $— $496 .4 %
Commercial real estate78 — 629 7 714 1.4 
Residential mortgages(b)
— 28 12 9 49 — 
Credit card228 — — — 228 .8 
Other retail4 1 69 1 75 .2 
Total loans, excluding loans purchased from GNMA mortgage pools354 29 1,162 17 1,562 .4 
Loans purchased from GNMA mortgage pools(b)
1 908 173 204 1,286 1.1 
Total loans$355 $937 $1,335 $221 $2,848 .8 %
(a)Includes $97 million of total loans receiving a payment delay and term extension, $134 million of total loans receiving an interest rate reduction and term extension and $25 million of total loans receiving an interest rate reduction, payment delay and term extension for the three months ended June 30, 2025, compared with $111 million, $17 million and $8 million for the three months ended June 30, 2024, respectively. Includes $166 million of total loans receiving a payment delay and term extension, $191 million of total loans receiving an interest rate reduction and term extension and $40 million of total loans receiving an interest rate reduction, payment delay and term extension for the six months ended June 30, 2025, compared with $189 million, $20 million and $12 million for the six months ended June 30, 2024, respectively.
(b)Percent of class total amounts expressed as a percent of total residential mortgage loan balances.
Loan modifications included in the table above exclude trial period arrangements offered to customers and secured loans to consumer borrowers that have had debt discharged through bankruptcy where the borrower has not reaffirmed the debt during the periods presented. At June 30, 2025 the balance of loans modified in trial period arrangements was $173 million, while the balance of secured loans to consumer borrowers that have had debt discharged through bankruptcy was not material.
The following table summarizes the effects of loan modifications made to borrowers on loans modified:
Three Months Ended June 30
Weighted-Average
Interest Rate
Reduction
Weighted-Average
Months of Term
Extension
2025
Commercial(a)
5.4 %14
Commercial real estate— 4
Residential mortgages1.3 95
Credit card16.0 —
Other retail4.6 12
Loans purchased from GNMA mortgage pools.4 100
2024
Commercial(a)
20.6 %5
Commercial real estate2.2 8
Residential mortgages.5 86
Credit card16.3 —
Other retail7.6 5
Loans purchased from GNMA mortgage pools.5 119
Six Months Ended June 30Weighted-Average Interest Rate ReductionWeighted-Average Months of Term Extension
2025
Commercial(a)
7.7 %12
Commercial real estate2.1 5
Residential mortgages1.4 94
Credit card16.1 —
Other retail5.0 19
Loans purchased from GNMA mortgage pools.4 99
2024
Commercial(a)
20.0 %7
Commercial real estate2.2 9
Residential mortgages.7 85
Credit card16.3 —
Other retail8.4 4
Loans purchased from GNMA mortgage pools.5 116
Note: The weighted-average payment deferral for all portfolio classes was less than $1 million for the three and six months ended June 30, 2025 and 2024. Forbearance payments are required to be paid at the end of the original term loan.
(a)The weighted-average interest rate reduction was primarily driven by commercial cards.
For the commercial lending segment, modifications generally result in the Company working with borrowers on a case-by-case basis. Commercial and commercial real estate modifications generally include extensions of the maturity date and may be accompanied by an increase or decrease to the interest rate. In addition, the Company may work with the borrower in identifying other changes that mitigate loss to the Company, which may include additional collateral or guarantees to support the loan. To a lesser extent, the Company may provide an interest rate reduction.
Modifications for the consumer lending segment are generally part of programs the Company has initiated. The Company modifies residential mortgage loans under Federal Housing Administration, United States Department of Veterans Affairs, or its own internal programs. Under these programs, the Company offers qualifying homeowners the opportunity to permanently modify their loan and achieve more affordable monthly payments. These modifications may include adjustments to interest rates, conversion of adjustable rates to fixed rates, extension of maturity dates or deferrals of payments, capitalization of accrued interest and/or outstanding advances, or in limited situations, partial forgiveness of loan principal. In some instances, participation in residential mortgage loan modification programs requires the customer to complete a short-term trial period. A permanent loan modification is
contingent on the customer successfully completing the trial period arrangement, and the loan documents are not modified until that time.
Credit card and other retail loan modifications are generally part of distinct modification programs providing customers experiencing financial difficulty with modifications whereby balances may be amortized up to 60 months, and generally include waiver of fees and reduced interest rates.
Loans that receive a forbearance plan generally remain in default until they are no longer delinquent as the result of the payment of all past due amounts or the borrower receiving a term extension or modification. Therefore, loans only receiving forbearance plans are not included in the table below.
The following table provides a summary of loan balances as of June 30, which were modified during the prior twelve months, by portfolio class and delinquency status:
(Dollars in Millions)  Current
30-89 Days
Past Due
90 Days or
More Past Due
Total
2025
Commercial$556 $38 $108 $702 
Commercial real estate799 — 111 910 
Residential mortgages(a)
1,433 5 8 1,446 
Credit card316 64 35 415 
Other retail96 13 6 115 
Total loans$3,200 $120 $268 $3,588 
2024
Commercial$628 $17 $117 $762 
Commercial real estate847 — 419 1,266 
Residential mortgages(a)
1,585 6 13 1,604 
Credit card293 64 34 391 
Other retail122 17 6 145 
Total loans$3,475 $104 $589 $4,168 
(a)At June 30, 2025, $413 million of loans 30-89 days past due and $239 million of loans 90 days or more past due purchased and that could be purchased from GNMA mortgage pools under delinquent loan repurchase options whose payments are insured by the Federal Housing Administration or guaranteed by the United States Department of Veterans Affairs, were classified as current, compared with $462 million and $196 million at June 30, 2024 respectively.
The following table provides a summary of loans that defaulted (fully or partially charged-off or became 90 days or more past due) that were modified within twelve months prior to default:
Three Months Ended June 30
(Dollars in Millions)		Interest Rate ReductionPayment DelayTerm Extension
Multiple Modifications(a)
2025
Commercial$9 $— $1 $— 
Commercial real estate36 — — — 
Residential mortgages— — — 3 
Credit card34 — — — 
Other retail— — 5 — 
Total loans, excluding loans purchased from GNMA mortgage pools79 — 6 3 
Loans purchased from GNMA mortgage pools— 61 29 50 
Total loans$79 $61 $35 $53 
2024
Commercial$7 $— $— $— 
Commercial real estate— — 24 — 
Residential mortgages— 9 1 1 
Credit card30 — — — 
Other retail1 — 5 — 
Total loans, excluding loans purchased from GNMA mortgage pools38 9 30 1 
Loans purchased from GNMA mortgage pools— 58 24 29 
Total loans$38 $67 $54 $30 
Six Months Ended June 30
(Dollars in Millions)		Interest Rate Reduction
Payment Delay
Term Extension
Multiple Modifications(a)
2025
Commercial$19 $— $21 $— 
Commercial real estate36 — — — 
Residential mortgages— — — 3 
Credit card69 — — — 
Other retail1 — 10 — 
Total loans, excluding loans purchased from GNMA mortgage pools125 — 31 3 
Loans purchased from GNMA mortgage pools— 100 44 89 
Total loans$125 $100 $75 $92 
2024
Commercial$13 $— $— $— 
Commercial real estate— — 24 — 
Residential mortgages— 13 4 3 
Credit card59 — — — 
Other retail1 1 10 — 
Total loans, excluding loans purchased from GNMA mortgage pools73 14 38 3 
Loans purchased from GNMA mortgage pools— 96 43 57 
Total loans$73 $110 $81 $60 
(a)Includes $29 million of total loans receiving a payment delay and term extension, $20 million of total loans receiving an interest rate reduction and term extension, and $4 million of total loans receiving an interest rate reduction, payment delay and term extension for the three months ended June 30, 2025, compared with $29 million of total loans receiving a payment delay and term extension and $1 million of total loans receiving an interest rate reduction and term extension for the three months ended June 30, 2024. Includes $54 million of total loans receiving a payment delay and term extension, $33 million of total loans receiving an interest rate reduction and term extension, and $5 million of total loans receiving an interest rate reduction, payment delay and term extension for the six months ended June 30, 2025, compared with $58 million, $1 million and $1 million for the six months ended June 30, 2024, respectively.
As of June 30, 2025 the Company had $438 million of commitments to lend additional funds to borrowers whose terms of their outstanding owed balances have been modified.