Net Investment in Finance Leases

The following table represents the components of the net investment in finance leases (in thousands):



	December 31, 2017			December 31, 2016
Future minimum lease payment receivable (1)	$	283,374		$	353,811
Estimated residual receivable	64,560			65,793
Gross finance lease receivables	347,934			419,604
Unearned income (2)	(52,043		)	(72,794		)
Net investment in finance leases (3)	$	295,891		$	346,810

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(1) At the inception of the lease, the Company records the total minimum lease payments net of executory costs, if any. The gross finance lease receivable is reduced as billed to the customer and reclassified to accounts receivable until paid. There were no executory costs included in gross finance lease receivables as of December 31, 2017 and 2016.

(2) The difference between the gross finance lease receivable and the fair value of the equipment at the lease inception is recorded as unearned income. Unearned income together with initial direct costs, are amortized to income over the lease term so as to produce a constant periodic rate of return. There were no unamortized initial direct costs as of December 31, 2017 and 2016.

(3) As of December 31, 2017 and 2016, approximately 46% and 43% of the Company's net investment in finance leases were with CMA CGM, respectively. As of December 31, 2017 and 2016, approximately 28% and 23% of the Company's net investment in finance leases were with Hapag Lloyd AG, respectively.

Contractual maturities of the Company’s gross finance lease receivables subsequent to December 31, 2017 are as follows (in thousands):



Years ending December 31,
2018	$	76,237
2019	70,776
2020	81,184
2021	46,372
2022	40,861
2023 and thereafter	32,504
Total	$	347,934

Note 8—Net Investment in Finance Leases (continued)

The Company evaluates potential losses in its finance lease portfolio by regularly reviewing the specific receivables in the portfolio and analyzing loss experience.

The Company maintains allowances, if necessary, for doubtful accounts and estimated losses resulting from the inability of its lessees to make required payments under finance leases. These allowances are based on, but not limited to, each lessee’s payment history, management’s current assessment of each lessee’s financial condition and the recoverability. The Company currently does not have an allowance on its gross finance lease receivables.