STI 2018 Annual Report

Notes to Consolidated Financial Statements, continued 115 NOTE 8 - ALLOWANCE FOR CREDIT LOSSES The allowance for credit losses consists of the ALLL and the unfunded commitments reserve. Activity in the allowance for credit losses by loan segment is presented in the following tables: Year Ended December 31, 2018 (Dollars in millions) Commercial Consumer Total ALLL, beginning of period $1,101 $634 $1,735 Provision for loan losses 86 132 218 Loan charge-offs (131) (322) (453) Loan recoveries 24 91 115 ALLL, end of period 1,080 535 1,615 Unfunded commitments reserve, beginning of period 1 79 — 79 Benefit for unfunded commitments (10) — (10) Unfunded commitments reserve, end of period 1 69 — 69 Allowance for credit losses, end of period $1,149 $535 $1,684 1 The unfunded commitments reserve is recorded in Other liabilities in the Consolidated Balance Sheets. Year Ended December 31, 2017 (Dollars in millions) Commercial Consumer Total ALLL, beginning of period $1,124 $585 $1,709 Provision for loan losses 108 289 397 Loan charge-offs (167) (324) (491) Loan recoveries 40 84 124 Other 1 (4) — (4) ALLL, end of period 1,101 634 1,735 Unfunded commitments reserve, beginning of period 2 67 — 67 Provision for unfunded commitments 12 — 12 Unfunded commitments reserve, end of period 2 79 — 79 Allowance for credit losses, end of period $1,180 $634 $1,814 1 Related to loans disposed in connection with the sale of PAC. For additional information regarding the sale of PAC, see Note 3, "Acquisitions/Dispositions." 2 The unfunded commitments reserve is recorded in Other liabilities in the Consolidated Balance Sheets. Year Ended December 31, 2016 (Dollars in millions) Commercial Consumer Total ALLL, beginning of period $1,047 $705 $1,752 Provision for loan losses 329 111 440 Loan charge-offs (287) (304) (591) Loan recoveries 35 73 108 ALLL, end of period 1,124 585 1,709 Unfunded commitments reserve, beginning of period 1 63 — 63 Provision for unfunded commitments 4 — 4 Unfunded commitments reserve, end of period 1 67 — 67 Allowance for credit losses, end of period $1,191 $585 $1,776 1 The unfunded commitments reserve is recorded in Other liabilities in the Consolidated Balance Sheets. As discussed in Note 1, “Significant Accounting Policies,” the ALLL is composed of both specific allowances for certain nonaccrual loans and TDRs, and general allowances for groups of loans with similar risk characteristics. No allowance is required for loans measured at fair value. Additionally, the Company records an immaterial allowance for loan products that are insured by federal agencies or guaranteed by GSEs, as there is nominal risk of principal loss.