Cat Financial Financing Activities (Tables)

6 Months Ended

Jun. 30, 2021

Jun. 30, 2020

Allowance for credit losses and total finance receivables

An analysis of the allowance for credit losses was as follows:



(Millions of dollars)	Three Months Ended June 30, 2021						Three Months Ended June 30, 2020
Allowance for Credit Losses:	Customer		Dealer		Total		Customer		Dealer		Total
Beginning balance	$	393	$	44	$	437	$	408	$	45	$	453
Write-offs	(68)		—		(68)		(36)		—		(36)
Recoveries	14		—		14		6		—		6
Provision for credit losses	13		—		13		86		—		86
Other	2		—		2		3		—		3
Ending balance	$	354	$	44	$	398	$	467	$	45	$	512

	Six Months Ended June 30, 2021						Six Months Ended June 30, 2020
Allowance for Credit Losses:	Customer		Dealer		Total		Customer		Dealer		Total
Beginning balance	$	431	$	44	$	475	$	375	$	45	$	420
Adjustment to adopt new accounting guidance 1	—		—		—		12		—		12
Write-offs	(102)		—		(102)		(73)		—		(73)
Recoveries	24		—		24		13		—		13
Provision for credit losses	3		—		3		146		—		146
Other	(2)		—		(2)		(6)		—		(6)
Ending balance	$	354	$	44	$	398	$	467	$	45	$	512

Individually evaluated	$	183	$	39	$	222	$	184	$	39	$	223
Collectively evaluated	171		5		176		283		6		289
Ending Balance	$	354	$	44	$	398	$	467	$	45	$	512

Finance Receivables:
Individually evaluated	$	492	$	78	$	570	$	601	$	78	$	679
Collectively evaluated	19,356		2,585		21,941		17,869		3,305		21,174
Ending Balance	$	19,848	$	2,663	$	22,511	$	18,470	$	3,383	$	21,853
1 Adjustment to adopt new accounting guidance related to credit losses.

Financing Receivable Credit Quality Indicators

The tables below summarize the aging category of Cat Financial's amortized cost of finance receivables in the Customer portfolio segment by origination year:



(Millions of dollars)	June 30, 2021
	2021		2020		2019		2018		2017		Prior		Revolving Finance Receivables		Total Finance Receivables
North America
Current	$	2,469	$	3,224	$	1,931	$	957	$	325	$	111	$	117	$	9,134
31-60 days past due	12		37		25		19		8		3		—		104
61-90 days past due	4		7		5		5		2		2		—		25
91+ days past due	2		17		27		15		10		6		2		79


EAME
Current	952		1,275		669		329		126		38		—		3,389
31-60 days past due	6		10		15		2		1		1		—		35
61-90 days past due	—		7		4		2		—		—		—		13
91+ days past due	3		11		7		6		3		61		—		91


Asia/Pacific
Current	857		1,088		498		151		33		6		—		2,633
31-60 days past due	4		22		17		8		1		—		—		52
61-90 days past due	—		8		9		4		—		—		—		21
91+ days past due	—		12		8		8		1		—		—		29


Mining
Current	433		420		478		272		89		191		71		1,954
31-60 days past due	—		3		—		—		—		—		—		3
61-90 days past due	—		—		—		—		—		—		—		—
91+ days past due	—		1		2		4		2		—		—		9


Latin America
Current	315		452		233		93		30		19		—		1,142
31-60 days past due	1		14		6		3		1		—		—		25
61-90 days past due	—		3		2		1		—		—		—		6
91+ days past due	—		18		11		11		6		8		—		54


Caterpillar Power Finance
Current	27		215		132		82		209		180		109		954
31-60 days past due	—		—		—		—		—		—		—		—
61-90 days past due	—		—		—		—		—		2		—		2
91+ days past due	—		2		—		20		3		69		—		94

Total Customer	$	5,085	$	6,846	$	4,079	$	1,992	$	850	$	697	$	299	$	19,848



(Millions of dollars)	December 31, 2020
	2020		2019		2018		2017		2016		Prior		Revolving Finance Receivables		Total Finance Receivables
North America
Current	$	3,777	$	2,423	$	1,344	$	522	$	212	$	27	$	89	$	8,394
31-60 days past due	52		49		33		16		7		2		—		159
61-90 days past due	22		25		16		9		2		1		—		75
91+ days past due	14		35		31		20		9		4		2		115


EAME
Current	1,605		931		501		203		60		18		—		3,318
31-60 days past due	5		15		3		2		—		—		—		25
61-90 days past due	1		1		2		1		—		—		—		5
91+ days past due	7		7		12		4		39		43		—		112


Asia/Pacific
Current	1,375		745		321		61		10		3		—		2,515
31-60 days past due	12		22		13		6		—		—		—		53
61-90 days past due	7		11		7		1		—		—		—		26
91+ days past due	4		10		9		3		—		—		—		26


Mining
Current	490		571		287		152		92		151		137		1,880
31-60 days past due	5		—		5		1		—		—		—		11
61-90 days past due	—		—		—		—		—		—		—		—
91+ days past due	—		11		8		2		—		—		1		22


Latin America
Current	561		348		151		48		13		34		—		1,155
31-60 days past due	3		6		4		3		—		—		—		16
61-90 days past due	1		7		6		3		2		—		—		19
91+ days past due	2		14		11		24		5		4		—		60


Caterpillar Power Finance
Current	217		172		111		273		99		117		119		1,108
31-60 days past due	—		—		6		—		—		—		—		6
61-90 days past due	—		—		—		—		—		9		—		9
91+ days past due	2		—		20		3		25		79		—		129

Total Customer	$	8,162	$	5,403	$	2,901	$	1,357	$	575	$	492	$	348	$	19,238

Investment in finance receivables on non-accrual status

In Cat Financial's Customer portfolio segment, finance receivables which were on non-accrual status and finance receivables over 90 days past due and still accruing income were as follows:



	June 30, 2021						December 31, 2020
	Amortized Cost						Amortized Cost
(Millions of dollars)	Non-accrual With an Allowance		Non-accrual Without an Allowance		91+ Still Accruing		Non-accrual With an Allowance		Non-accrual Without an Allowance		91+ Still Accruing

North America	$	62	$	1	$	19	$	86	$	1	$	34
EAME	89		—		2		113		1		1
Asia/Pacific	19		1		11		13		—		13
Mining	9		1		—		21		1		—
Latin America	57		—		1		63		—		1
Caterpillar Power Finance	113		—		—		170		17		—
Total	$	349	$	3	$	33	$	466	$	20	$	49

There was $1 million of interest income recognized during the three months ended June 30, 2021 and 2020 for customer finance receivables on non-accrual status. There were $6 million and $5 million of interest income recognized during the six month ended June 30, 2021 and 2020, respectively, for customer finance receivables on non-accrual status.

Finance receivables modified as TDRs

Cat Financial’s finance receivables in the Customer portfolio segment modified as TDRs were as follows:



(Millions of dollars)	Three Months Ended June 30, 2021				Three Months Ended June 30, 2020
	Pre-TDR Amortized Cost		Post-TDR Amortized Cost		Pre-TDR Amortized Cost		Post-TDR Amortized Cost
Customer
North America	$	4	$	4	$	9	$	9

Asia/Pacific	—		—		8		8
Mining	—		—		17		17
Latin America	6		6		—		—
Caterpillar Power Finance	16		16		37		37
Total	$	26	$	26	$	71	$	71

	Six Months Ended June 30, 2021				Six Months Ended June 30, 2020
	Pre-TDR Amortized Cost		Post-TDR Amortized Cost		Pre-TDR Amortized Cost		Post-TDR Amortized Cost
North America	$	4	$	4	$	9	$	9

Asia/Pacific	—		—		8		8
Mining	11		5		17		17
Latin America	6		6		2		2
Caterpillar Power Finance	16		16		37		37
Total	$	37	$	31	$	73	$	73

The Post-TDR amortization costs in the Customer portfolio segment with a payment default (defined as 91+ days past due) which had been modified within twelve months prior to the default date, were as follows:



	Three Months Ended June 30				Six Months Ended June 30
Customer	2021		2020		2021		2020
North America	$	—	$	—	$	1	$	—
EAME	—		—		—		10
Asia/Pacific	2		—		6		—

Latin America	15		—		15		1
Caterpillar Power Finance	—		—		5		—
Total	$	17	$	—	$	27	$	11