Direct financing and leveraged assets, residual value of leased assets

  
Corporate LoansCorporate loans represent loans and leases managed by ICG. The following table presents information by corporate loan type:  


|  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |
| In millions of dollars | December 31,2021 | December 31,2020 |
| In North America offices(1) |   |   |
| Commercial and industrial | $ | 51,999  |  | $ | 57,731  |  |
| Financial institutions | 66,936  |  | 55,809  |  |
| Mortgage and real estate(2) | 63,357  |  | 60,675  |  |
| Installment and other | 29,143  |  | 26,744  |  |
| Lease financing | 413  |  | 673  |  |
| Total | $ | 211,848  |  | $ | 201,632  |  |
| In offices outside North America(1) |   |   |
| Commercial and industrial | $ | 103,167  |  | $ | 104,072  |  |
| Financial institutions | 32,203  |  | 32,334  |  |
| Mortgage and real estate(2) | 10,412  |  | 11,371  |  |
| Installment and other | 34,436  |  | 33,759  |  |
| Lease financing | 42  |  | 65  |  |
| Governments and official institutions | 4,423  |  | 3,811  |  |
| Total | $ | 184,683  |  | $ | 185,412  |  |
| Corporate loans, net of unearned income(3) | $ | 396,531  |  | $ | 387,044  |  |

  
(1)North America includes the U.S., Canada and Puerto Rico. Mexico is included in offices outside North America. The classification between offices in North America and outside North America is based on the domicile of the booking unit. The difference between the domicile of the booking unit and the domicile of the managing unit is not material.(2)Loans secured primarily by real estate.(3)Corporate loans are net of unearned income of ($799) million and ($844) million at December 31, 2021 and 2020, respectively. Unearned income on corporate loans primarily represents interest received in advance, but not yet earned, on loans originated on a discounted basis.  
The Company sold and/or reclassified to held-for-sale $5.9 billion and $2.2 billion of corporate loans during the years ended December 31, 2021 and 2020, respectively. The Company did not have significant purchases of corporate loans classified as held-for-investment for the years ended December 31, 2021 or 2020.Lease financing Citi is a lessor in the power, railcars, shipping and aircraft sectors, where the Company has executed operating, direct financing and leveraged leases. Citi’s $0.5 billion of lease financing receivables, as of December 31, 2021, is composed of approximately equal balances of direct financing lease receivables and net investments in leveraged leases. Citi uses the interest rate implicit in the lease to determine the present value of its lease financing receivables. Interest income on direct financing and leveraged leases during the year ended December 31, 2021 was not material.The Company’s leases have an average remaining maturity of approximately three and a half years. In certain cases, Citi obtains residual value insurance from third parties and/or the lessee to manage the risk associated with the residual value of the leased assets. The receivable related to the residual value of the leased assets is $0.2 billion as of December 31, 2021, while the amount covered by residual value guarantees is nil.The Company’s operating leases, where Citi is a lessor, are not significant to the Consolidated Financial Statements.  
Delinquency StatusCiti generally does not manage corporate loans on a delinquency basis. Corporate loans are identified as impaired and placed on a cash (non-accrual) basis when it is determined, based on actual experience and a forward-looking assessment of the collectability of the loan in full, that the payment of interest or principal is doubtful or when interest or principal is 90 days past due, except when the loan is well collateralized and in the process of collection. Any interest accrued on impaired corporate loans and leases is reversed at 90 days and charged against current earnings, and interest is thereafter included in earnings only to the extent actually received in cash. When there is doubt regarding the ultimate collectability of principal, all cash receipts are thereafter applied to reduce the recorded investment in the loan. While corporate loans are generally managed based on their internally assigned risk rating (see further discussion below), the following tables present delinquency information by corporate loan type. 213
