v3.26.1
Finance Receivables
 3 Months Ended
Mar. 31, 2026
Receivables [Abstract]  
Finance Receivables Finance Receivables
A summary of finance receivables included in the Consolidated Statements of Financial Position was as follows:
(Millions of dollars)March 31,
2026		December 31,
2025
Retail loans(1)
$19,311 $19,218 
Retail finance leases6,639 6,870 
Caterpillar purchased receivables5,489 5,500 
Wholesale loans(1)
1,482 1,511 
Total finance receivables32,921 33,099 
Less: Allowance for credit losses(283)(284)
Total finance receivables, net$32,638 $32,815 
(1)    Includes failed sale leasebacks.

Finance leases
Leases classified as sales-type or direct financing are reported as finance leases. Revenues from finance leases were $120 million and $112 million for the three months ended March 31, 2026 and 2025, respectively, and are included in retail and wholesale finance revenues in the Consolidated Statements of Profit.

A.Allowance for credit losses 

Portfolio segments
A portfolio segment is the level at which we develop a systematic methodology for determining our allowance for credit losses. Our portfolio segments and related methods for estimating expected credit losses are as follows:

Customer
We provide loans and finance leases to end-user customers primarily for the purpose of financing new and used Caterpillar machinery, engines and equipment for commercial use. We also provide financing for power generation facilities that incorporate Caterpillar products. The average original term of our customer finance receivables portfolio was approximately 51 months with an average remaining term of approximately 28 months as of March 31, 2026.

We typically maintain a security interest in financed equipment and generally require physical damage insurance coverage on the financed equipment, both of which provide us with certain rights and protections. If our collection efforts fail to bring a defaulted account current, we generally can repossess the financed equipment, after satisfying local legal requirements, and sell it within the Caterpillar dealer network or through third-party auctions.

We estimate the allowance for credit losses related to our customer finance receivables based on loss forecast models utilizing probabilities of default and our estimated loss given default based on past loss experience adjusted for current conditions and reasonable and supportable forecasts capturing country and industry-specific economic factors.

During the three months ended March 31, 2026, our forecasts reflected a continuation of global market uncertainty and actions by global central banks aimed at balancing economic growth and managing inflation. We believe the economic forecasts employed represent reasonable and supportable forecasts, followed by a reversion to long-term trends.

Dealer
We provide financing to Caterpillar dealers on a secured and unsecured basis in the form of wholesale financing plans and retail loans. Our wholesale financing plans provide financing to dealers for their new Caterpillar equipment inventory and rental fleets. The retail loans to dealers are primarily for working capital.
    
We estimate the allowance for credit losses for dealer finance receivables based on historical loss rates with consideration of current economic conditions and reasonable and supportable forecasts.

In general, our Dealer portfolio segment has not historically experienced large increases or decreases in credit losses based on changes in economic conditions due to our close working relationships with the dealers and their financial strength. Therefore, we made no adjustments to historical loss rates during the three months ended March 31, 2026.
Caterpillar Purchased Receivables
We purchase receivables from Caterpillar, primarily related to the sale of equipment and parts to dealers. Caterpillar purchased receivables are non-interest-bearing short-term trade receivables that are purchased at a discount.

We estimate the allowance for credit losses for Caterpillar purchased receivables based on historical loss rates with consideration of current economic conditions and reasonable and supportable forecasts.

In general, our Caterpillar Purchased Receivables portfolio segment has not historically experienced large increases or decreases in credit losses based on changes in economic conditions due to the short-term maturities of the receivables, our close working relationships with the dealers and their financial strength. Therefore, we made no adjustments to historical loss rates during the three months ended March 31, 2026.

Classes of finance receivables
We further evaluate our portfolio segments by the class of finance receivables, which is defined as a level of information (below a portfolio segment) in which the finance receivables have the same initial measurement attribute and a similar method for assessing and monitoring credit risk. Our classes, which align with management reporting for credit losses, are as follows:

•North America - Finance receivables originated in the United States and Canada.
•EAME - Finance receivables originated in Europe, Africa, the Middle East and Eurasia.
•Asia/Pacific - Finance receivables originated in Australia, New Zealand, China, Japan, Southeast Asia and India.
•Latin America - Finance receivables originated in Mexico and Central and South American countries.
•Mining - Finance receivables originated worldwide related to large mining customers.
•Power - Finance receivables originated worldwide related to large power customers of Caterpillar electrical power generation, gas compression and co-generation systems and non-Caterpillar equipment that is powered by these systems.
An analysis of the allowance for credit losses was as follows:
(Millions of dollars)Three Months Ended March 31, 2026Three Months Ended March 31, 2025
CustomerDealerCaterpillar
Purchased
Receivables		TotalCustomerDealerCaterpillar
Purchased
Receivables		Total
Beginning Balance$273 $4 $7 $284 $258 $4 $5 $267 
Write-offs(42)— — (42)(30)— — (30)
Recoveries13 — — 13 10 — — 10 
Provision for credit losses(1)
29 — (1)28 33 — — 33 
Other— — — — 2 — — 2 
Ending Balance$273 $4 $6 $283 $273 $4 $5 $282 
Finance Receivables$24,448 $2,984 $5,489 $32,921 $22,701 $2,504 $4,477 $29,682 
(1)    Excludes provision for credit losses on unfunded commitments and other miscellaneous receivables.
Gross write-offs by origination year for our Customer portfolio segment were as follows:
(Millions of dollars)Three Months Ended March 31, 2026
20262025202420232022PriorRevolving Finance ReceivablesTotal
North America$— $3 $8 $6 $2 $2 $3 $24 
EAME— 1 1 1 — 1 — 4 
Asia/Pacific— 3 1 1 — — — 5 
Latin America— 1 2 1 1 — — 5 
Mining— 4 — — — — — 4 
Total$— $12 $12 $9 $3 $3 $3 $42 
Three Months Ended March 31, 2025
20252024202320222021PriorRevolving Finance ReceivablesTotal
North America$— $2 $5 $4 $2 $1 $2 $16 
EAME— 1 1 1 — — — 3 
Asia/Pacific— — 1 — 1 — — 2 
Latin America— — 1 1 — 1 — 3 
Mining— 3 1 1 — — — 5 
Power— — — — — 1 — 1 
Total$— $6 $9 $7 $3 $3 $2 $30 

B.Credit quality of finance receivables

At origination, we evaluate credit risk based on a variety of credit quality factors including prior payment experience, customer financial information, credit ratings, loan-to-value ratios, probabilities of default, industry trends, macroeconomic factors and other internal metrics. On an ongoing basis, we monitor credit quality based on past-due status as there is a meaningful correlation between the past-due status of customers and the risk of loss. In determining past-due status, we consider the entire finance receivable past due when any installment is over 30 days past due.
Customer
The aging analysis of our Customer portfolio segment by origination year was as follows:
(Millions of dollars)March 31, 2026
20262025202420232022PriorRevolving Finance ReceivablesTotal Finance Receivables
North America
Current$1,389 $5,117 $3,264 $1,582 $589 $219 $524 $12,684 
31-60 days past due2 34 33 24 11 4 3 111 
61-90 days past due— 11 10 6 5 1 2 35 
91+ days past due— 18 36 27 18 8 2 109 
EAME
Current283 1,381 829 528 261 113 — 3,395 
31-60 days past due1 14 11 8 3 2 — 39 
61-90 days past due— 8 7 5 3 2 — 25 
91+ days past due— 8 12 14 9 4 — 47 
Asia/Pacific
Current319 1,045 597 320 107 29 53 2,470 
31-60 days past due— 8 7 3 2 1 — 21 
61-90 days past due— 2 5 1 1 — — 9 
91+ days past due— 3 2 2 1 — — 8 
Latin America
Current228 867 440 181 77 12 4 1,809 
31-60 days past due— 7 7 4 2 — — 20 
61-90 days past due— 2 4 1 1 — — 8 
91+ days past due— 3 10 7 4 1 — 25 
Mining
Current257 904 737 440 244 132 22 2,736 
31-60 days past due— 1 — 1 — 1 — 3 
61-90 days past due— — 1 — — — — 1 
91+ days past due— — — — — — — — 
Power
Current75 243 271 152 54 22 76 893 
31-60 days past due— — — — — — — — 
61-90 days past due— — — — — — — — 
91+ days past due— — — — — — — — 
Totals by Aging Category
Current2,551 9,557 6,138 3,203 1,332 527 679 23,987 
31-60 days past due3 64 58 40 18 8 3 194 
61-90 days past due— 23 27 13 10 3 2 78 
91+ days past due— 32 60 50 32 13 2 189 
Total$2,554 $9,676 $6,283 $3,306 $1,392 $551 $686 $24,448 
(Millions of dollars)December 31, 2025
20252024202320222021PriorRevolving
Finance
Receivables		Total
Finance
Receivables
North America
Current$5,531 $3,634 $1,845 $743 $318 $20 $510 $12,601 
31-60 days past due30 42 28 18 6 1 4 129 
61-90 days past due11 14 10 5 3 — 2 45 
91+ days past due11 34 29 20 8 3 1 106 
EAME
Current1,560 938 614 316 114 44 — 3,586 
31-60 days past due5 12 6 6 2 — — 31 
61-90 days past due3 5 3 2 1 — — 14 
91+ days past due5 9 12 6 3 2 — 37 
Asia/Pacific
Current1,175 691 380 137 42 3 50 2,478 
31-60 days past due5 8 3 1 — — — 17 
61-90 days past due2 3 1 2 — — — 8 
91+ days past due1 1 2 2 — — — 6 
Latin America
Current984 511 212 96 15 1 4 1,823 
31-60 days past due3 6 5 3 — — — 17 
61-90 days past due2 2 2 1 — 1 — 8 
91+ days past due1 10 7 4 1 — — 23 
Mining
Current946 806 495 280 107 51 — 2,685 
31-60 days past due3 — — — — — — 3 
61-90 days past due— — — — — — — — 
91+ days past due1 1 8 — — — — 10 
Power
Current272 264 179 37 8 37 148 945 
31-60 days past due— — — — — — — — 
61-90 days past due— — — — — — — — 
91+ days past due— — — — — — — — 
Totals by Aging Category
Current10,468 6,844 3,725 1,609 604 156 712 24,118 
31-60 days past due46 68 42 28 8 1 4 197 
61-90 days past due18 24 16 10 4 1 2 75 
91+ days past due19 55 58 32 12 5 1 182 
Total$10,551 $6,991 $3,841 $1,679 $628 $163 $719 $24,572 

Dealer
As of March 31, 2026 and December 31, 2025, the total amortized cost of finance receivables within our Dealer portfolio segment was current.
Caterpillar Purchased Receivables
The aging analysis of our Caterpillar Purchased Receivables portfolio segment was as follows:
(Millions of dollars)March 31, 2026
 Current31-60
Days
Past Due		61-90
Days
Past Due		91+
Days
Past Due
Total Finance
Receivables
North America$3,270 $7 $5 $2 $3,284 
EAME1,127 1 — — 1,128 
Asia/Pacific705 3 — — 708 
Latin America353 1 — — 354 
Power13 2 — — 15 
Total$5,468 $14 $5 $2 $5,489 
December 31, 2025
Current31-60
Days
Past Due		61-90
Days
Past Due		91+
Days
Past Due		Total Finance
Receivables
North America$3,242 $9 $7 $5 $3,263 
EAME1,189 1 — — 1,190 
Asia/Pacific646 1 — — 647 
Latin America387 — — — 387 
Power11 2 — — 13 
Total$5,475 $13 $7 $5 $5,500 

Non-accrual finance receivables
In our 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:
(Millions of dollars)March 31, 2026December 31, 2025
Amortized CostAmortized Cost
Non-accrual91+ Still
Accruing		Non-accrual91+ Still
Accruing
North America$104 $14 $90 $20 
EAME44 6 35 5 
Asia/Pacific6 3 4 2 
Latin America25 — 24 1 
Mining3 — 10 — 
Total$182 $23 $163 $28 
    
There were no finance receivables in our Dealer portfolio segment on non-accrual status as of March 31, 2026 and December 31, 2025.

Modifications
We periodically modify the terms of our finance receivable agreements. Typically, the types of modifications granted are payment deferrals, interest only payment periods and/or term extensions. Many modifications we grant are for commercial reasons or for borrowers experiencing some form of short-term financial stress and may result in insignificant payment delays. We do not consider these borrowers to be experiencing financial difficulty. Modifications for borrowers we do consider to be experiencing financial difficulty typically result in payment deferrals and/or reduced payments for a period of four months or longer, term extension of six months or longer or a combination of both.

During the three months ended March 31, 2026 and 2025, there were no finance receivable modifications granted to borrowers experiencing financial difficulty in our Dealer or Caterpillar Purchased Receivables portfolio segments.
The ending amortized cost of finance receivables modified with borrowers experiencing financial difficulty in our Customer portfolio segment was as follows:
(Millions of dollars)Three Months Ended
March 31,
20262025
Amortized cost of finance receivables modified$11 $6 
Modifications as a percentage of Customer portfolio0.04 %0.03 %

The financial effects of term extensions and payment delays for borrowers experiencing financial difficulty were as follows:
(In months)Three Months Ended
March 31,
20262025
Weighted average extension to term of modified contracts137
Weighted average payment deferral and/or interest only periods68

After we modify a finance receivable, we continue to track its performance under its most recent modified terms. Defaults of loans modified in the prior twelve months were not significant during the three months ended March 31, 2026 and 2025.

The effect of most modifications made to finance receivables for borrowers experiencing financial difficulty is already included in the allowance for credit losses based on the methodologies used to estimate the allowance; therefore, a change to the allowance for credit losses is generally not recorded upon modification. On rare occasions when principal forgiveness is provided, the amount forgiven is written off against the allowance for credit losses.