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This excerpt taken from the C 8-K filed Apr 17, 2009. Credit costs of $10.3 billion,
up 76%, consisted of $7.3 billion in net credit losses, a $2.7 billion net loan
loss reserve build, and $332 million of policyholder benefits and claims. Net credit losses increased $3.6 billion,
primarily driven by Consumer Banking and Cards in North America, and Securities
and Banking. The incremental net loan
loss reserve build of $754 million was mainly driven by Global Cards and
Securities and Banking. The total allowance
for loans, leases and unfunded lending commitments was $32.7 billion.
· These excerpts taken from the C 10-K filed Feb 27, 2009. Credit Costs We believe that credit costs are expected to increase during 2009.
A detailed review and outlook for each of our business segments, as of December 31, 2008, are included in the discussions that follow, and the risks are more fully discussed on pages 29 to 38.
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Table of Contents
Credit Costs We believe that credit costs are expected to increase during 2009.
A detailed review and outlook for each of our business segments, as of December 31, 2008, are included in the discussions that follow, and the risks are more fully discussed on pages 29 to 38.
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Table of Contents
This excerpt taken from the C 8-K filed Oct 16, 2008. Credit costs were $9.1 billion,
up 86%. Credit costs primarily consisted of $4.9 billion in net credit losses
and a $3.9 billion net charge to increase loan loss reserves. Net credit losses
increased $2.5 billion, primarily driven by Consumer Banking and Cards in North
America. The incremental net charge to increase loan loss reserves of $1.7
billion was mainly due to Consumer Banking and Cards in North America, and
Securities and Banking.
· This excerpt taken from the C 8-K filed Jul 18, 2008. Credit Costs
· In North America, credit costs increased $345 million, driven by higher net credit losses, up 51%, and a $111 million incremental net charge to increase loan loss reserves. Higher credit costs reflected a weakening of leading credit indicators, trends in the macro-economic environment, including the housing market downturn, higher fuel costs, rising unemployment trends, and higher bankruptcy filings, as well as the continued acceleration in the rate at which delinquent customers advanced to write-off. The managed net credit loss ratio increased 202 basis points to 6.53%.
· In EMEA, credit costs increased 61%, primarily driven by higher net credit losses, up $84 million. The increase in net credit losses was primarily driven by the impact of the Egg acquisition and higher business volumes.
· In Latin America, credit costs increased 60%, as net credit losses more than doubled. Higher net credit losses were driven by higher business volumes and an increase in losses and past due accounts in Mexico and Brazil. The net credit loss ratio increased 457 basis points to 11.41%.
· In Asia, credit costs increased 76%, reflecting higher business volumes, a 28% increase in net credit losses, primarily driven by India, and a $49 million incremental net charge to increase loan loss reserves.
· This excerpt taken from the C 8-K filed Jan 15, 2008. Credit costs increased $5.41 billion, primarily
driven by an increase in net credit losses of $1.56 billion and a net charge of
$3.85 billion to increase loan loss reserves.
· U.S. consumer credit costs increased $4.1 billion, comprised of $689 million in higher net credit losses and a net charge of $3.31 billion to increase loan loss reserves. The $3.31 billion net charge compares to a net reserve release of $127 million in the prior-year period. The increase in credit costs primarily reflected a weakening of leading credit indicators, including increased delinquencies on 1st and 2nd mortgages, unsecured personal loans, credit cards, and auto loans. Credit costs increased also due to trends in the U.S. macro-economic environment, including the housing market downturn, and portfolio growth. · International consumer credit costs increased $374 million, comprised of $257 million of higher net credit losses and a net charge of $217 million to increase loan loss reserves. The $217 million net charge compares to a net charge of $100 million in the prior-year period. The increase in credit costs primarily reflected portfolio growth, the impact of recent acquisitions, and an increase in net credit loss ratios in consumer finance. The credit environment in international consumer remained generally stable. · Markets & banking credit costs increased $905 million, driven by higher net credit losses, including $535 million of net credit losses on loans with sub-prime related direct exposure. Credit costs also include a $284 million net charge to increase loan loss and unfunded lending commitment reserves reflecting a slight weakening in overall portfolio credit quality, as well as loan loss reserves for specific counterparties. The loan loss reserves for specific counterparties includes $169 million for sub-prime related direct exposures. · This excerpt taken from the C 8-K filed Oct 15, 2007. Credit costs increased $2.98 billion, primarily
driven by an increase in net credit losses of $780 million and a net charge of
$2.24 billion to increase loan loss reserves.
· In U.S. consumer, higher credit costs reflected an increase in net credit losses of $278 million and a net charge of $1.30 billion to increase loan loss reserves. The $1.30 billion net charge compares to a net reserve release of $197 million in the prior-year period. The increase in credit costs primarily reflected a weakening of leading credit indicators, including increased delinquencies on mortgages and unsecured personal loans, as well as trends in the U.S. macro-economic environment, portfolio growth, and a change in estimate of loan losses inherent in the portfolio but not yet visible in delinquencies (“a change in estimate of loan losses”). · In international consumer, higher credit costs reflected an increase in net credit losses of $460 million and a net charge of $717 million to increase loan loss reserves. The $717 million net charge compares to a net charge of $101 million in the prior-year period. The increase in credit costs primarily reflected the impact of recent acquisitions, portfolio growth, and a change in estimate of loan losses. · Markets & banking credit costs increased $98 million, primarily reflecting higher net credit losses and a $123 million net charge to increase loan loss reserves for specific counterparties. Credit costs reflected a slight weakening in portfolio credit quality. · This excerpt taken from the C 8-K filed Apr 16, 2007. Credit costs increased $1.26 billion, primarily
driven by an increase in net credit losses of $509 million and a net charge of
$597 million to increase loan loss reserves.
The $597 million net charge compares to a net reserve release of $154 million
in the prior-year period.
· In U.S. consumer, higher credit costs reflected an increase in net credit losses of $164 million and a net charge of $182 million to increase loan loss reserves. The $182 million net charge compares to a net reserve release of $196 million in the prior year period. Credit costs increased primarily in U.S. consumer lending and U.S. retail distribution, reflecting portfolio growth, an increase in delinquencies in second mortgages, and a change in estimate of loan losses inherent in the portfolio. · In international consumer, higher credit reflected an increase in net credit losses of $331 million, and a net charge to increase loan loss reserves of $112 million. Higher credit costs primarily reflected portfolio growth, including target market expansion in Mexico cards and the integration of Credicard in Brazil, increased net credit losses in Japan consumer finance, and a change in estimate of loan losses inherent in the portfolio. The international consumer credit environment was generally stable. · Markets & banking credit costs increased primarily due to a net charge of $286 million to increase loan loss reserves due to portfolio growth, which includes higher commitments to leveraged transactions and an increase in average loan tenor. The $286 million net charge compares to a $33 million net charge to increase reserves in the prior-year period. The global corporate credit environment remained stable. · | EXCERPTS ON THIS PAGE:
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