XML 41 R30.htm IDEA: XBRL DOCUMENT v3.3.1.900
Finance Receivables (Tables)
 12 Months Ended
Dec. 31, 2015
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]  
Finance Receivables Portfolio
The finance receivables portfolio consists of the following (in millions):
 
December 31, 2015
 
December 31, 2014
 
North
America
 
International
 
Total
 
North
America
 
International
 
Total
Retail
 
 
 
 
 
 
 
 
 
 
 
Retail finance receivables, collectively evaluated for impairment, net of fees(a)
$
16,536

 
$
10,976

 
$
27,512

 
$
12,127

 
$
12,262

 
$
24,389

Retail finance receivables, individually evaluated for impairment, net of fees
1,612

 
—

 
1,612

 
1,234

 
—

 
1,234

Total retail finance receivables(b)
18,148

 
10,976

 
29,124

 
13,361

 
12,262

 
25,623

Less: allowance for loan losses - collective
(398
)
 
(117
)
 
(515
)
 
(405
)
 
(78
)
 
(483
)
Less: allowance for loan losses - specific
(220
)
 


 
(220
)
 
(172
)
 
—

 
(172
)
Total retail finance receivables, net
17,530

 
10,859

 
28,389

 
12,784

 
12,184

 
24,968

Commercial
 
 
 
 
 
 
 
 
 
 
 
Commercial finance receivables, collectively evaluated for impairment, net of fees
4,043

 
4,314

 
8,357

 
3,180

 
4,803

 
7,983

Commercial finance receivables, individually evaluated for impairment, net of fees
8

 
74

 
82

 
—

 
89

 
89

Total commercial finance receivables
4,051

 
4,388

 
8,439

 
3,180

 
4,892

 
8,072

Less: allowance for loan losses - collective
(23
)
 
(15
)
 
(38
)
 
(21
)
 
(14
)
 
(35
)
Less: allowance for loan losses - specific
—

 
(9
)
 
(9
)
 
—

 
(5
)
 
(5
)
Total commercial finance receivables, net
4,028

 
4,364

 
8,392

 
3,159

 
4,873

 
8,032

Total finance receivables, net
$
21,558

 
$
15,223

 
$
36,781

 
$
15,943

 
$
17,057

 
$
33,000


________________
(a)
Amounts reported in the International Segment include $1.1 billion and $1.0 billion of direct-financing leases at December 31, 2015 and 2014.
(b)
Net of unamortized premiums and discounts, and deferred fees and costs of $179 million and $245 million at December 31, 2015 and 2014.
Summary of Finance Receivables
Following is a summary of activity in our retail finance receivables portfolio (in millions): 
 
 
Years ended December 31,
 
 
2015
 
2014
 
2013
 
 
North America
 
International
 
Total
 
North America
 
International
 
Total
 
North America
 
International
 
Total
Beginning balance
 
$
13,361

 
$
12,262

 
$
25,623

 
$
11,388

 
$
11,742

 
$
23,130

 
$
10,789

 
$
—

 
$
10,789

Acquisition
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
10,310

 
10,310

Purchases
 
10,931

 
6,606

 
17,537

 
6,808

 
8,277

 
15,085

 
5,126

 
4,471

 
9,597

Principal collections and other
 
(5,272
)
 
(5,696
)
 
(10,968
)
 
(4,054
)
 
(6,180
)
 
(10,234
)
 
(3,943
)
 
(3,086
)
 
(7,029
)
Charge-offs
 
(859
)
 
(137
)
 
(996
)
 
(776
)
 
(138
)
 
(914
)
 
(584
)
 
(54
)
 
(638
)
Foreign currency translation
 
(13
)
 
(2,059
)
 
(2,072
)
 
(5
)
 
(1,439
)
 
(1,444
)
 
—

 
101

 
101

Ending balance
 
$
18,148

 
$
10,976

 
$
29,124

 
$
13,361

 
$
12,262

 
$
25,623

 
$
11,388

 
$
11,742

 
$
23,130
Allowance for Credit Losses on Financing Receivables
A summary of the activity in the allowance for retail loan losses is as follows (in millions):
 
 
Years ended December 31,
 
 
2015
 
2014
 
2013
 
 
North America
 
International
 
Total
 
North America
 
International
 
Total
 
North America
 
International
 
Total
Beginning balance
 
$
577

 
$
78

 
$
655

 
$
468

 
$
29

 
$
497

 
$
345

 
$
—

 
$
345

Provision for loan losses
 
461

 
151

 
612

 
468

 
145

 
613

 
380

 
52

 
432

Charge-offs
 
(859
)
 
(137
)
 
(996
)
 
(776
)
 
(138
)
 
(914
)
 
(584
)
 
(54
)
 
(638
)
Recoveries
 
439

 
47

 
486

 
417

 
53

 
470

 
327

 
29

 
356

Foreign currency translation
 
—

 
(22
)
 
(22
)
 
—

 
(11
)
 
(11
)
 
—

 
2

 
2

Ending balance
 
$
618

 
$
117

 
$
735

 
$
577

 
$
78

 
$
655

 
$
468

 
$
29

 
$
497
Financing Receivable Credit Quality Indicators
A summary of the credit risk profile by FICO score band or equivalent scores, determined at origination, of the retail finance receivables in the North America Segment is as follows (dollars in millions):
 
December 31, 2015
 
December 31, 2014
 
Amount
 
Percent
 
Amount
 
Percent
Prime - FICO Score 680 and greater
$
4,418

 
24.4
%
 
$
596

 
4.4
%
Near-prime - FICO Score 620 to 679
2,890

 
15.9
%
 
1,691

 
12.7
%
Sub-prime - FICO Score less than 620
10,840

 
59.7
%
 
11,074

 
82.9
%
Balance at end of period
$
18,148

 
100.0
%
 
$
13,361

 
100.0
%
Past Due Financing Receivables
The following is a summary of the contractual amounts of retail finance receivables, which is not significantly different than recorded investment, that are (i) more than 30 days delinquent, but not yet in repossession, and (ii) in repossession, but not yet charged off (dollars in millions): 
 
December 31, 2015
 
December 31, 2014
 
North America
 
International
 
Total
 
Percent of Contractual Amount Due
 
North America
 
International
 
Total
 
Percent of Contractual Amount Due
31 - 60 days
$
1,150

 
$
87

 
$
1,237

 
4.2
%
 
$
994

 
$
89

 
$
1,083

 
4.2
%
Greater than 60 days
389

 
92

 
481

 
1.6

 
328

 
104

 
432

 
1.7

 
1,539

 
179

 
1,718

 
5.8

 
1,322

 
193

 
1,515

 
5.9

In repossession
42

 
4

 
46

 
0.2

 
36

 
4

 
40

 
0.2

 
$
1,581

 
$
183

 
$
1,764

 
6.0
%
 
$
1,358

 
$
197

 
$
1,555

 
6.1
%
Troubled Debt Restructurings on Financing Receivables
The outstanding recorded investment for retail finance receivables that are considered to be TDRs and the related allowance is presented below (in millions):
 
December 31, 2015
 
December 31, 2014
Outstanding recorded investment
$
1,612

 
$
1,234

Less: allowance for loan losses
(220
)
 
(172
)
Outstanding recorded investment, net of allowance
$
1,392

 
$
1,062

Unpaid principal balance
$
1,642

 
$
1,255

Additional information about loans classified as TDRs is presented below (in millions, except for number of loans):
 
Years Ended December 31,
 
2015
 
2014
 
2013
Average outstanding recorded investment
$
1,455

 
$
996

 
$
487

Finance income recognized
$
164

 
$
123

 
$
70

Number of loans classified as TDRs during the period
58,012

 
49,490

 
38,196

Recorded investment of loans classified as TDRs during the period
$
982

 
$
794

 
$
643
Activity in Commercial Finance Receivables Portfolio
Following is a summary of activity in our commercial finance receivables portfolio (in millions): 
 
 
Years ended December 31,
 
 
2015
 
2014
 
2013
 
 
North America
 
International
 
Total
 
North America
 
International
 
Total
 
North America
 
International
 
Total
Beginning balance
 
$
3,180

 
$
4,892

 
$
8,072

 
$
1,975

 
$
4,725

 
$
6,700

 
$
560

 
$
—

 
$
560

Acquisition
 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
4,834

 
4,834

Net funding (collections)
 
933

 
51

 
984

 
1,228

 
661

 
1,889

 
1,424

 
(246
)
 
1,178

Charge-offs
 
(2
)
 
(1
)
 
(3
)
 
—

 
—

 
—

 
(2
)
 
(3
)
 
(5
)
Foreign currency translation
 
(60
)
 
(554
)
 
(614
)
 
(23
)
 
(494
)
 
(517
)
 
(7
)
 
140

 
133

Ending balance
 
$
4,051

 
$
4,388

 
$
8,439

 
$
3,180

 
$
4,892

 
$
8,072

 
$
1,975

 
$
4,725

 
$
6,700
Credit Risk Profile of Commercial Financing Receivables
A summary of the credit risk profile by dealer grouping of the commercial finance receivables is as follows (in millions): 
 
 
 
December 31, 2015
 
December 31, 2014
Group I
-
Dealers with superior financial metrics
$
1,299

 
$
1,062

Group II
-
Dealers with strong financial metrics
2,648

 
2,090

Group III
-
Dealers with fair financial metrics
2,703

 
2,856

Group IV
-
Dealers with weak financial metrics
1,100

 
1,250

Group V
-
Dealers warranting special mention due to potential weaknesses
505

 
559

Group VI
-
Dealers with loans classified as substandard, doubtful or impaired
184

 
255

Balance at end of period
$
8,439

 
$
8,072