- Caterpillar (CAT) has been forced to accept delayed payments or ease terms on many of the loans and leases it made to buyers of its marine engines in Europe, blaming a glut of commercial vessels and low cargo rates due to Europe's sluggish economy.
- CAT's 10-Q filing last week revealed $436M of "impaired" loans and leases in its power-systems segment, up 52% Y/Y, concentrated among marine-engine customers in Europe.
- Overall, CAT says its financing arm continues to "perform well" - its allowance for credit losses was $422M, or 1.46% of net finance receivables, as of June 30, vs. $393M, or 1.47%, a year earlier.
Ship engine loans are Caterpillar weak spot
Aug 8 2013, 17:35 ET