The company experienced broad-based improvement in overall asset quality during the quarter. Non-performing and business services criticized loans decreased compared to the prior quarter. Net charge-offs improved sequentially, totaling $101M, or 42 basis points of average loans. Net charge-offs are expected to be towards the upper end of the 40 to 50 basis point range attributable to a few large credits within areas previously identified as under stress. However, these expected losses are reflected within the allowance for credit losses as of quarter-end. The allowance for credit loss ratio decreased 1 basis point to 1.78% of total loans, while the allowance as a percentage of nonperforming loans increased to 204%.
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