19 – Allowance for Credit Losses


The allowance for credit losses consists of an allowance for loan losses and an allowance for off-balance sheet positions.

The following table presents a breakdown of the movements in the Group’s allowance for loan losses for the periods specified.

 

2010

2009

2008

in € m.

Individually assessed

Collectively assessed

Total

Individually assessed

Collectively assessed

Total

Individually assessed

Collectively assessed

Total

Allowance, beginning of year

2,029

1,314

3,343

977

961

1,938

930

775

1,705

Provision for loan losses

562

751

1,313

1,789

808

2,597

382

702

1,084

Net charge-offs:

(896)

(404)

(1,300)

(637)

(419)

(1,056)

(301)

(477)

(778)

Charge-offs

(934)

(509)

(1,443)

(670)

(552)

(1,222)

(364)

(626)

(990)

Recoveries

38

104

143

33

133

166

63

149

212

Changes in the group of consolidated companies

Exchange rate changes/other

(52)

(8)

(60)

(101)

(36)

(137)

(34)

(39)

(74)

Allowance, end of year

1,643

1,653

3,296

2,029

1,314

3,343

977

961

1,938

The following table presents the activity in the Group’s allowance for off-balance sheet positions, which consists of contingent liabilities and lending-related commitments.

 

2010

2009

2008

in € m.

Individually assessed

Collectively assessed

Total

Individually assessed

Collectively assessed

Total

Individually assessed

Collectively assessed

Total

Allowance, beginning of year

83

124

207

98

112

210

101

118

219

Provision for off-balance sheet positions

(18)

(21)

(39)

21

12

33

(2)

(6)

(8)

Usage

(45)

(45)

Changes in the group of consolidated companies

42

42

Exchange rate changes/other

1

7

8

10

10

(1)

(1)

Allowance, end of year

108

110

218

83

124

207

98

112

210

In 2010 we recorded changes in the group of consolidated companies for off-balance sheet allowances following the consolidation of acquisitions amounting to € 34 million for Postbank Group and € 8 million for Sal. Oppenheim/BHF-BANK.

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