61-90 days past due........ - - - - - - - - 91+ days past due.......... - 11 8 2 - - 1 22 Latin America Current................ 561 348 151 48 13 34 - 1,155 31-60 days past due........ 3 6 4 3 - - - 16 61-90 days past due........ 1 7 6 3 2 - - 19 91+ days past due.......... 2 14 11 24 5 4 - 60 Caterpillar Power Finance Current................ 217 172 111 273 99 117 119 1,108 31-60 days past due........ - - 6 - - - - 6 61-90 days past due........ - - - - - 9 - 9 91+ days past due.......... 2 - 20 3 25 79 - 129 Total Customer USD 8,162 USD 5,403 USD 2,901 USD 1,357 USD 575 USD 492 USD 348 USD 19,238
Finance receivables in the Customer portfolio segment are substantially secured by collateral, primarily in the form of Caterpillar and other machinery. For those contracts where the borrower is experiencing financial difficulty, repayment of the outstanding amounts is generally expected to be provided through the operation or repossession and sale of the machinery.
Dealer
As of March 31, 2021, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current, with the exception of USD78 million that was 91+ days past due in Latin America, all of which was originated in 2017. As of December 31, 2020, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current, with the exception of USD81 million that was 91+ days past due in Latin America. Of these past due receivables, USD78 million were originated in 2017 and USD3 million were originated prior to 2016.
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Non-accrual finance receivables
Recognition of income is suspended and the finance receivable is placed on non-accrual status when management determines that collection of future income is not probable. Contracts on non-accrual status are generally more than 120 days past due or have been restructured in a troubled debt restructuring (TDR). Recognition is resumed and previously suspended income is recognized when the finance receivable becomes current and collection of remaining amounts is considered probable. Payments received while the finance receivable is on non-accrual status are applied to interest and principal in accordance with the contractual terms. Interest earned but uncollected prior to the receivable being placed on non-accrual status is written off through Provision for credit losses when, in the judgment of management, it is considered uncollectible.
In Cat Financial's 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:
March 31, 2021 December 31, 2020
Amortized Cost Amortized Cost
Non-accrual Non-accrual 91+ Still Non-accrual Non-accrual 91+ Still (Millions of dollars) With an Without an Accruing With an Without an Accruing Allowance Allowance Allowance Allowance North America......... USD USD 27 EAME............. 3 Asia/Pacific......... 2 - - 1 1 USD 86 1 1 - 1 - USD 34 76 109 20 7 57 147 USD 14 USD Mining............. 11 113 13 21 63 170 17 1 13 - 1 1 Latin America........ 2 Caterpillar Power Finance Total ................USD 416 USD 15 USD 47 USD 466 USD 20 USD 49
There was USD3 million and less than USD1 million of interest income recognized during the three months ended March 31, 2021 and 2020, respectively, for customer finance receivables on non-accrual status.
As of March 31, 2021 and December 31, 2020, finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status were USD78 million and USD81 million, respectively, all of which was in Latin America. There were no finance receivables in Cat Financial's Dealer portfolio segment more than 90 days past due and still accruing income as of March 31, 2021 and December 31, 2020 and no interest income was recognized on dealer finance receivables on non-accrual status during the three months ended March 31, 2021 and 2020.
Troubled debt restructurings
A restructuring of a finance receivable constitutes a TDR when the lender grants a concession it would not otherwise consider to a borrower experiencing financial difficulties. Concessions granted may include extended contract maturities, inclusion of interest only periods, below market interest rates, payment deferrals and reduction of principal and/or accrued interest. We individually evaluate TDR contracts and establish an allowance based on the present value of expected future cash flows discounted at the receivable's effective interest rate, the fair value of the collateral for collateral-dependent receivables or the observable market price of the receivable.
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There were no finance receivables modified as TDRs during the three months ended March 31, 2021 and 2020 for the Dealer portfolio segment. Cat Financial's finance receivables in the Customer portfolio segment modified as TDRs were as follows:
(Millions of dollars) Three Months Ended Three Months Ended March 31, 2020 March 31, 2021
Pre-TDR Post-TDR Pre-TDR Post-TDR Amortized Amortized Amortized Amortized
Cost Cost Cost Cost
Mining................................... USD 11 USD 5 USD - USD Latin America.............................. 2 2 Total..................................... USD 11 USD 5 USD 2 USD 2
TDRs in the Customer portfolio segment with a payment default (defined as 91+ days past due) which had been modified within twelve months prior to the default date, were as follows:
(Millions of dollars) Three Months Ended Three Months Ended March 31, 2020 March 31, 2021 Post-TDR Post-TDR Amortized Cost Amortized Cost North America................................ USD 1 USD - EAME...................................... - 10 Asia Pacific.................................. 4 - Latin America................................. - 1 Caterpillar Power Finance......................... 5 - Total....................................... USD 10 USD 11
18. Fair value disclosures
A. Fair value measurements
The guidance on fair value measurements defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. This guidance also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. In accordance with this guidance, fair value measurements are classified under the following hierarchy: ? Level 1 - Quoted prices for identical instruments in active markets. ? Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar
instruments in markets that are not active; and model-derived valuations in which all significant inputs or
significant value-drivers are observable in active markets. ? Level 3 - Model-derived valuations in which one or more significant inputs or significant value-drivers are
unobservable.
When available, we use quoted market prices to determine fair value, and we classify such measurements within Level 1. In some cases where market prices are not available, we make use of observable market based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon valuations in which one or more significant inputs are unobservable, including internally developed models that use, where possible, current market-based parameters such as interest rates, yield curves and currency rates. These measurements are classified within Level 3.
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We classify fair value measurements according to the lowest level input or value-driver that is significant to the valuation. We may therefore classify a measurement within Level 3 even though there may be significant inputs that are readily observable.
Fair value measurement includes the consideration of nonperformance risk. Nonperformance risk refers to the risk that an obligation (either by a counterparty or Caterpillar) will not be fulfilled. For financial assets traded in an active market (Level 1 and certain Level 2), the nonperformance risk is included in the market price. For certain other financial assets and liabilities (certain Level 2 and Level 3), our fair value calculations have been adjusted accordingly.
Investments in debt and equity securities
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