Ford 2003 Annual Report Download - page 83

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2003 ANNUAL REPORT 81
NOTES TO FINANCIAL STATEMENTS
NOTE 8. FINANCE RECEIVABLES — FINANCIAL SERVICES SECTOR
Net finance receivables at December 31 were as follows (in millions):
2003 2002
Retail $ 80,973 $ 71,479
Wholesale 22,910 16,827
Other finance receivables 9,115 11,054
Total finance receivables 112,998 99,360
Allowance for credit losses (2,436) (2,667)
Other 331 314
Net finance and other receivables $110,893 $ 97,007
Finance receivables that originated outside the U.S. were $45.7 billion and $42.0 billion at December 31, 2003 and 2002,
respectively. Other finance receivables consisted primarily of real estate, commercial and other collateralized loans and
accrued interest. Included in wholesale and other finance receivables at December 31, 2003 and 2002 were $2.9 billion and
$2.5 billion, respectively, of accounts receivable purchased by certain Financial Services sector operations from Automotive
sector operations.
Future maturities, exclusive of the effects of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, of total
finance receivables including minimum lease rentals are as follows (in billions): 2004 — $61.9; 2005 — $22.9; 2006 — $12.6;
thereafter — $12.0. Experience indicates that a substantial portion of the portfolio generally is repaid before the contractual
maturity dates.
Finance receivables subject to fair value at December 31, 2003 and 2002 were $102.9 billion and $88.3 billion, respectively.
The fair value of these finance receivables at December 31, 2003 and 2002 was $103.9 billion and $89.9 billion, respectively.
Included in retail receivables above are investments in direct financing leases. The net investment at December 31 was as
follows (in millions):
2003 2002
Total minimum lease rentals to be received $ 5,532 $ 5,660
Less: Unearned income (972) (1,048)
Loan origination costs 42 37
Estimated residual values 4,017 3,689
Less: Allowance for credit losses (139) (77)
Net investment in direct financing leases $ 8,480 $ 8,261
The investment in direct financing leases relates to the leasing of vehicles, various types of transportation and other equipment
and facilities. Future maturities of minimum lease rentals, as included above, are as follows (in billions): 2004 — $2.1; 2005 —
$1.7; 2006 — $1.2; thereafter — $0.5.
The Financial Services sector sold receivables in off-balance sheet securitizations and whole-loan transactions and retained
servicing rights. In off-balance sheet securitizations, we retain interests in the sold receivables, and with respect to subordinated
retained interests, we have credit risk. At December 31, 2003, outstanding sold receivables were as follows (in billions):
2003
Ford Credit — outstanding sold receivables
Off-balance sheet securitizations $ 49.4
Whole-loan sale transactions 7.3
Total $ 56.7
FIN73_104 3/21/04 1:07 AM Page 81