GM Financial Receivables



	December 31, 2016									December 31, 2015
	Retail			Commercial			Total			Retail			Commercial			Total
Finance receivables, collectively evaluated for impairment, net of fees	$	30,989		$	10,652		$	41,641		$	27,512		$	8,127		$	35,639
Finance receivables, individually evaluated for impairment, net of fees	1,921			70			1,991			1,612			82			1,694
GM Financial receivables	32,910			10,722			43,632			29,124			8,209			37,333
Less: allowance for loan losses	(793		)	(50		)	(843		)	(735		)	(47		)	(782		)
GM Financial receivables, net	$	32,117		$	10,672		$	42,789		$	28,389		$	8,162		$	36,551

Fair value of GM Financial receivables							$	42,739								$	36,707

GM Financial estimates the fair value of retail finance receivables using observable and unobservable Level 3 inputs within a cash flow model. The inputs reflect assumptions regarding expected prepayments, deferrals, delinquencies, recoveries and charge-offs of the loans within the portfolio. The cash flow model produces an estimated amortization schedule of the finance receivables. The projected cash flows are then discounted using current risk-adjusted rates to derive the fair value of the portfolio. Macroeconomic factors could affect the credit performance of the portfolio and therefore could potentially affect the assumptions used in GM Financial's cash flow model. A substantial majority of GM Financial's commercial finance receivables have variable interest rates and maturities of one year or less. Therefore, the carrying amount, a level 2 input, is considered to be a reasonable estimate of fair value.



	Years Ended December 31,
	2016			2015			2014
Allowance for loan losses at beginning of period	$	782		$	695		$	548
Provision for loan losses	669			624			604
Charge-offs	(1,173		)	(999		)	(914		)
Recoveries	561			487			470
Effect of foreign currency	4			(25		)	(13		)
Allowance for loan losses at end of period	$	843		$	782		$	695

The allowance for loan losses on retail and commercial finance receivables included a collective allowance of $560 million, $553 million and $518 million and a specific allowance of $283 million, $229 million and $177 million at December 31, 2016, 2015 and 2014.

Retail Finance Receivables GM Financial uses proprietary scoring systems in its underwriting process that measure the credit quality of retail finance receivables using several factors, such as credit bureau information, consumer credit risk scores (e.g. FICO scores or its equivalent) and contract characteristics. In addition to GM Financial's proprietary scoring systems GM Financial considers other individual consumer factors such as employment history, financial stability and capacity to pay. Subsequent to origination GM Financial reviews the credit quality of retail finance receivables based on customer payment activity. In North America, while we historically focused on consumers with lower than prime credit scores, we have expanded our prime lending programs. At December 31, 2016 and 2015, 48% and 60% of the retail finance receivables in North America were from consumers with sub-prime credit scores, which are defined as FICO scores or its equivalent of less than 620 at the time of loan origination. At the time of loan origination, substantially all of GM Financial's international consumers have the equivalent of prime credit scores.

GM Financial purchases retail finance contracts from automobile dealers without recourse, and accordingly, the dealer has no liability to GM Financial if the consumer defaults on the contract. Finance receivables are collateralized by vehicle titles and GM Financial has the right to repossess the vehicle in the event the consumer defaults on the payment terms of the contract.

An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date such payment was contractually due. At December 31, 2016 and 2015 the accrual of finance charge income had been suspended on delinquent retail finance receivables with contractual amounts due of $807 million and $778 million. The following table summarizes the contractual amount of delinquent retail finance receivables, which is not significantly different than the recorded investment of the retail finance receivables:



	December 31, 2016				December 31, 2015
	Amount		Percent of Contractual Amount Due		Amount		Percent of Contractual Amount Due
31-to-60 days delinquent	$	1,235	3.7	%	$	1,237	4.2	%
Greater-than-60 days delinquent	542		1.7	%	481		1.6	%
Total finance receivables more than 30 days delinquent	1,777		5.4	%	1,718		5.8	%
In repossession	51		0.1	%	46		0.2	%
Total finance receivables more than 30 days delinquent or in repossession	$	1,828	5.5	%	$	1,764	6.0	%

At December 31, 2016 and 2015 retail finance receivables classified as TDRs and individually evaluated for impairment were $1.9 billion and $1.6 billion and the allowance for loan losses included $276 million and $220 million of specific allowances on these receivables.

Commercial Finance Receivables GM Financial's commercial finance receivables consist of dealer financings, primarily for inventory purchases. A proprietary model is used to assign a risk rating to each dealer. A credit review of each dealer is performed at least annually, and if necessary, the dealer's risk rating is adjusted on the basis of the review. Dealers in Group VI are subject to additional restrictions on funding, up to suspension of lines of credit and liquidation of assets. At December 31, 2016 and 2015 the commercial finance receivables on non-accrual status were insignificant. The following table summarizes the credit risk profile by dealer grouping of the commercial finance receivables:



		December 31, 2016		December 31, 2015
Group I	– Dealers with superior financial metrics	$	1,576	$	1,298
Group II	– Dealers with strong financial metrics	3,299		2,573
Group III	– Dealers with fair financial metrics	3,842		2,597
Group IV	– Dealers with weak financial metrics	1,201		1,058
Group V	– Dealers warranting special mention due to potential weaknesses	636		501
Group VI	– Dealers with loans classified as substandard, doubtful or impaired	168		182
		$	10,722	$	8,209