Company: CFG-PE
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0000759944-25-000070
Chunk: 6

Company: CITIZENS FINANCIAL GROUP INC/RI
Filing Date: 2025-05-01
Form: 10-Q
Item: Part I, Item 8
Chunk 6
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 the ACL reserve methodology during the three months ended March 31, 2025.

Citizens Financial Group, Inc. | 42

The following table presents a summary of changes in the ACL for the three months ended March 31, 2025:Three Months Ended March 31, 2025(dollars in millions)CommercialRetailTotalAllowance for loan and lease losses, beginning of period$1,140 $921 $2,061 Charge-offs(85)(149)(234)Recoveries4 30 34 Net charge-offs(81)(119)(200)Provision expense (benefit) for loans and leases89 64 153 Allowance for loan and lease losses, end of period1,148 866 2,014 Allowance for unfunded lending commitments, beginning of period155 43 198 Provision expense (benefit) for unfunded lending commitments9 (9)— Allowance for unfunded lending commitments, end of period164 34 198 Total allowance for credit losses, end of period$1,312 $900 $2,212 During the three months ended March 31, 2025, net charge-offs of $200 million and a provision for expected credit losses of $153 million resulted in a decrease of $47 million to the ACL.During the first quarter of 2025, the Company entered into an agreement to sell $1.9 billion of Non-Core education loans and subsequently reclassified these loans to LHFS. Upon reclassification to LHFS, a $25 million charge-off was recognized. This transaction will settle ratably each quarter throughout 2025, with $200 million settled during the first quarter.As of March 31, 2025, the Company’s ACL economic forecast over a two-year reasonable and supportable period reflects a mild recession inclusive of uncertainties related to the implementation of tariffs and protectionist trade policies, inflationary pressures and geopolitical tensions. This forecast projects peak unemployment of approximately 5.1%, consistent with December 31, 2024, and a start-to-trough real GDP decline of approximately 0.5% and 0.4% at March 31, 2025 and December 31, 2024, respectively, and is generally applied to the retail and commercial and industrial portfolios. More severe economic scenarios are applied within the CRE portfolio, such as general office, with peak unemployment of approximately 9.3%