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Transactions with Related Parties
 12 Months Ended
Dec. 31, 2025
Related Party Transactions [Abstract]  
Transactions with Related Parties TRANSACTIONS WITH RELATED PARTIES
 
We have a Support Agreement with Caterpillar, which provides that Caterpillar will (1) remain, directly or indirectly, our sole owner; (2) cause us to maintain a tangible net worth of at least $20 million; and (3) ensure that we maintain a ratio of profit before income taxes and interest expense to interest expense (as defined by the Support Agreement) of not less than 1.15 to 1, calculated on an annual basis. Although this agreement can be modified or terminated by either party, any termination or any modification which would adversely affect holders of our debt requires the consent of holders of 66-2/3 percent in principal amount of outstanding debt of each series so affected. Any modification or termination which would adversely affect the lenders under the Credit Facility requires their consent. Caterpillar’s obligation under this agreement is not directly enforceable by any of our creditors and does not constitute a guarantee of any of our obligations. Cash dividends of $500 million, $625 million, and $425 million were paid to Caterpillar in 2025, 2024, and 2023, respectively.
 
Under our variable amount and term lending agreements and other notes receivable with Caterpillar, we may borrow up to $3.52 billion from Caterpillar and Caterpillar may borrow up to $2.29 billion from us. Most variable amount lending agreements are in effect for indefinite periods of time and may be changed or terminated by either party with 30 days notice. The term lending agreements have remaining maturities ranging up to nine years. Information concerning these agreements was as follows as of and for the years ending December 31: 
(Millions of dollars)202520242023
Payable to Caterpillar - borrowings $1,024 $10 $24 
Payable to Caterpillar - other 148 118 113 
Notes receivable from Caterpillar 663 559 527 
Other assets and receivables from Caterpillar(1)
163 85 39 
Interest expense28 1 1 
Interest income on Notes Receivable with Caterpillar(2)
26 23 21 
(1) Included in Other assets in the Consolidated Statements of Financial Position.
(2) Included in Other revenues, net in the Consolidated Statements of Profit.

We have agreements with Caterpillar to purchase certain trade receivables at a discount. In addition, we receive fee revenue from Caterpillar for our centralized activities benefiting the global factoring program. Cash flows related to our factoring programs with Caterpillar are included in Net changes in Caterpillar purchased receivables within investing activities in the Consolidated Statements of Cash Flows. Information pertaining to these purchases was as follows: 
(Millions of dollars)202520242023
Purchases made$55,656 $52,930 $53,382 
Revenue earned611 625 617 
Purchased Receivables as of December 31,5,500 4,283 3,949 

We participate in certain marketing programs offered in conjunction with Caterpillar and/or Caterpillar dealers that allow us to periodically offer financing to customers at interest rates that are below market rates. Under these marketing programs, Caterpillar and/or the dealer funds an amount at the outset of the transaction, which we then recognize as revenue over the term of the financing. During 2025, 2024, and 2023, relative to such programs, we received $667 million, $540 million, and $332 million, respectively.

At December 31, 2025 and 2024, $568 million and $473 million, respectively, of our portfolio was subject to guarantees by Caterpillar and affiliates.

We have finance receivable and operating lease agreements with Caterpillar related to end-user customer transactions. Information concerning these agreements was as follows as of and for the years ending December 31:
(Millions of dollars)202520242023
Finance receivables, net$272 $163 $109 
Equipment on operating leases, net97 115 46 
Revenue from Finance receivables and operating leases42 31 27 
Depreciation on equipment leased to others19 18 18 
Caterpillar provides defined benefit pension plans, defined contribution plans and other postretirement benefit plans to employees. We reimburse Caterpillar for these charges and other employee benefits paid by Caterpillar related to our employees. Further information about these plans is available in Caterpillar’s 2025 Annual Report on Form 10-K filed separately with the Securities and Exchange Commission.

Caterpillar provides operational and administrative support, which is integral to the conduct of our business. In 2025, 2024 and 2023, these operational and support charges for which we reimburse Caterpillar amounted to $58 million, $50 million and $50 million, respectively. In addition, we provide administrative support services to certain Caterpillar subsidiaries. Caterpillar reimburses us for these charges. During 2025, 2024 and 2023, these charges amounted to $18 million, $16 million and $15 million, respectively.

We join Caterpillar in the filing of a consolidated U.S. Federal income tax return and certain state income tax returns. In accordance with our tax sharing agreement with Caterpillar, we generally pay to or receive from Caterpillar our allocated share of income taxes or credits reflected in these consolidated filings. This amount is calculated on a separate return basis by taking taxable income times the applicable statutory tax rate and includes payment for certain tax attributes earned during the year.