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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549cfsc-20221231_g1.jpgFORM 10-K(Mark One)☒ANNUAL REPORT PURSUANT TO SECTION 13 OR15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31, 2022OR☐TRANSITION REPORT PURSUANT TO SECTION 13 OR15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from __________ to __________.Commission File No. 001-11241CATERPILLAR FINANCIAL SERVICES CORPORATION(Exact name of Registrant as specified in its charter)Delaware(State or other jurisdiction of incorporationor organization)37-1105865(I.R.S. Employer Identification No.)2120 West End Ave.,Nashville, Tennessee(Address of principal executive offices)37203-0001(Zip Code)Registrant’s telephone number, including area code:(615) 341-1000


Securities registered pursuant to Section 12(b) of the Act:Title of each classTrading Symbol(s)Name of each exchange on which registeredMedium-Term Notes, Series H,3.300% Notes Due 2024CAT/24New York Stock ExchangeSecurities registered pursuant to Section 12(g) of the Act:  None














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Yes








No








Yes








Yes











Large accelerated filer☐Accelerated filer☐Non-accelerated filer☒Smaller reporting company☐Emerging growth company☐




















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TABLE OF CONTENTSPagePart IItem 1.Business4Item 1A.Risk Factors7Item 1B.Unresolved Staff Comments14Item 2.Properties14Item 3.Legal Proceedings14Item 4.Mine Safety Disclosures14Part IIItem 5.Market for Registrant’s Common Equity, Related Stockholder Mattersand Issuer Purchases of Equity Securities14Item 6.[Reserved]Item 7.Management’s Discussion and Analysis of FinancialCondition and Results of Operations15Item 7A.Quantitative and Qualitative Disclosures About Market Risk27Item 8.Financial Statements and Supplementary Data27Item 9.Changes in and Disagreements With Accountants on Accounting andFinancial Disclosure27Item 9A.Controls and Procedures28Item 9B.Other Information28Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections28Part IIIItem 10.Directors, Executive Officers and Corporate Governance*Item 11.Executive Compensation*Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters*Item 13.Certain Relationships and Related Transactions, and Director Independence*Item 14.Principal Accounting Fees and Services29Part IVItem 15.Exhibits and Financial Statement Schedules29Item 16.Form 10-K Summary31
















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PART I



















Item 1.Business.












































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Item 1A.Risk Factors.



































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Item 1B.Unresolved Staff Comments.













Item 2.Properties.













Item 3.Legal Proceedings.













Item 4.Mine Safety Disclosures.













PART II







Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters andIssuer Purchases of Equity Securities.













Item 6.[Reserved]







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Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations.







































































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(Millions of dollars)20222021ChangeFinance receivable and operating lease fees (including late charges)$58$56$2Net gain (loss) on returned or repossessed equipment812655Interest income on Notes receivable from Caterpillar17143Miscellaneous other revenue, net20137Total Other revenue, net$176$109$67














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(Millions of dollars)20222021ChangeNew retail financing$10,211$11,867$(1,656)New operating lease activity1,1441,230(86)New wholesale financing47,74940,3937,356Total$59,104$53,490$5,614

















(Millions of dollars)20222021ChangeFinance receivables, net$26,441$27,177$(736)Equipment on operating leases, net2,9113,123(212)Total portfolio$29,352$30,300$(948)Retail loans, net$68$107$(39)Operating leases2123(2)Retail leases, net23194Total off-balance sheet managed assets$112$149$(37)Total managed portfolio$29,464$30,449$(985)




















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Three Months EndedDecember 31,20222021Revenues:Retail finance$326$294Operating lease217231Wholesale finance14177Other, net4041Total revenues724643Expenses:Interest189104Depreciation on equipment leased to others174185General, operating and administrative134146Provision for credit losses4710Other412Total expenses548457Other income (expense)(25)(7)Profit before income taxes151179Provision for income taxes3254Profit of consolidated companies119125Less:  Profit attributable to noncontrolling interests13Profit attributable to Caterpillar Financial Services Corporation$118$122











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(Millions of dollars)Three Months Ended December 31,20222021ChangeFinance receivable and operating lease fees (including late charges)$14$14$—Net gain (loss) on returned or repossessed equipment1418(4)Interest income on Notes receivable from Caterpillar44—Miscellaneous other revenue, net853Total Other revenue, net$40$41$(1)

















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(Millions of dollars)20222021Medium-term notes, net$20,672$22,246Commercial paper, net of unamortized discount5,4554,896Bank borrowings and other – long-term746348Bank borrowings and other – short-term234213Variable denomination floating rate demand notes265286Notes payable to Caterpillar2322Total outstanding borrowings$27,395$28,011











(Millions of dollars)2023$4,73120247,24820254,40820262,45220271,945Thereafter—Fair value adjustments(112)Total$20,672








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868

































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Item 7A.Quantitative and Qualitative Disclosures About Market Risk.























































Item 8.Financial Statements and Supplementary Data.













Item 9.Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
















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Item 9A.Controls and Procedures.




















































Item 9B.Other Information.



















Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.













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PART III







Item 14.Principal Accounting Fees and Services.





PricewaterhouseCoopers LLP Nashville, Tennessee 238














(Millions of dollars)20222021Audit fees(1)$7.0$7.4Audit-related fees(2)——Tax fees(3)0.10.1Total$7.1$7.5
















PART IV







Item 15.Exhibits and Financial Statement Schedules.


The following documents are filed as part of this report.1Financial Statements:·Report of Independent Registered Public Accounting Firm·Consolidated Statements of Profit·Consolidated Statements of Comprehensive Income·Consolidated Statements of Financial Position·Consolidated Statements of Changes in Shareholder’s Equity·Consolidated Statements of Cash Flows·Notes to Consolidated Financial Statements2Financial Statement Schedules:·All schedules are omitted because the required information is shown in the financial statements or the notes thereto or considered to be immaterial.3Exhibits:


3.1Certificate of Incorporation of the Company, as amended (incorporated by reference from Exhibit 3.1 to the Company’s Form 10 for the year ended December 31, 1984)3.2Bylaws of the Company, as amended (incorporated by reference from Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q, for the quarter ended June 30, 2005)4.1Indenture, dated as of April 15, 1985, between the Company and Morgan Guaranty Trust Company of New York, as Trustee (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-3)4.2First Supplemental Indenture, dated as of May 22, 1986, amending the Indenture dated as of April 15, 1985, between the Company and Morgan Guaranty Trust Company of New York, as Trustee (incorporated by reference from Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q, for the quarter ended June 20, 1986)4.3Second Supplemental Indenture, dated as of March 15, 1987, amending the Indenture dated as of April 15, 1985, between the Company and Morgan Guaranty Trust Company of New York, as Trustee (incorporated by reference from Exhibit 4.3 to the Company’s Current Report on Form 8-K, dated April 24, 1987)





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4.4Third Supplemental Indenture, dated as of October 2, 1989, amending the Indenture dated as of April 15, 1985, between the Company and Morgan Guaranty Trust Company of New York, as Trustee (incorporated by reference from Exhibit 4.3 to the Company’s Current Report on Form 8-K, dated October 16, 1989)4.5Fourth Supplemental Indenture, dated as of October 1, 1990, amending the Indenture dated April 15, 1985, between the Company and Morgan Guaranty Trust Company of New York, as Trustee (incorporated by reference from Exhibit 4.3 to the Company’s Current Report on Form 8-K, dated October 29, 1990)4.6Indenture, dated as of July 15, 1991, between the Company and Continental Bank, National Association, as Trustee (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form 8-K, dated July 25, 1991)4.7First Supplemental Indenture, dated as of October 1, 2005, amending the Indenture dated as of July 15, 1991, between the Company and U.S. Bank Trust National Association (as successor to the former Trustee) (incorporated by reference from Exhibit 4.3 to Amendment No. 5 to the Company’s Registration Statement on Form S-3 filed October 20, 2005)4.8Support Agreement, dated as of December 21, 1984, between the Company and Caterpillar (incorporated by reference from Exhibit 10.2 to the Company’s amended Form 10, for the year ended December 31, 1984)4.9First Amendment to the Support Agreement dated June 14, 1995, between the Company and Caterpillar (incorporated by reference from Exhibit 4 to the Company’s Current Report on Form 8-K, dated June 15, 1995)4.10Description of the registrant’s Medium-Term Notes, Series H, 3.300% Notes Due 2024 (incorporated by reference from Exhibit 4.10 to the Company’s Annual Report on Form 10-K, for the year ended December 31, 2019)The registrant hereby undertakes upon request to furnish the Commission with a copy of any instrument with respect to long-term debt where the total amount of securities authorized thereunder does not exceed 10% of the total assets of the registrant and its subsidiaries on a consolidated basis.10.1Amended and Restated Tax Sharing Agreement, dated as of May 31, 2018, between the Company and Caterpillar (incorporated by reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, for the quarter ended June 30, 2018)10.2Credit Agreement (2022364-Day Facility), datedasofSeptember1, 2022,by andamong Caterpillar Inc.,the Company, Caterpillar International Finance Designated Activity Companyand Caterpillar Finance Kabushiki Kaisha, certain financial institutions named therein, Citibank, N.A., as agent, Citibank Europe plc, UK Branch, as Local Currency Agent, and MUFG Bank, Ltd. as Japan Local Currency Agent (incorporated by reference from Exhibit 10.1 to the Company's Current Report on Form 8-K filed on September6, 2022)10.3Local Currency Addendumto the Credit Agreement (2022 364-Day Facility), dated as of September1, 2022, amongthe Company, Caterpillar International Finance Designated Activity Company, the Local Currency Banks named therein, Citibank, N.A., as Agent and Citibank Europe plc, UK Branch, as Local Currency Agent(incorporated by reference from Exhibit 10.2 to the Company's Current Report on Form 8-K filed September6, 2022)10.4Japan Local Currency Addendum to theCredit Agreement (2022 364-DayFacility), dated as of September 1, 2022, among the Company, Caterpillar Finance Kabushiki Kaisha, the Japan Local Currency Banks named therein, Citibank, N.A., as Agent and MUFG Bank, Ltd., as Local Currency Agent (incorporated by reference from Exhibit 10.3to the Company’s Current Report on Form 8-K filed on September 6, 2022)10.5ThirdAmended and Restated Credit Agreement (Three-Year Facility), dated as of September1, 2022, by and among the Company, CaterpillarInc., Caterpillar International Finance Designated Activity Company and Caterpillar Finance Kabushiki Kaisha, certain financial institutions named therein, Citibank, N.A., as Agent, Citibank Europe plc, UK Branch, as Local Currency Agent, and MUFG Bank, Ltd., as Japan Local Currency Agent (incorporated by reference from Exhibit 10.4 to the Company’s Current Report on Form 8-K filed September6, 2022)10.6Local Currency Addendum to theThirdAmended and Restated Credit Agreement (Three-Year Facility), dated as of September1, 2022, among the Company, Caterpillar International Finance Designated Activity Company, the Local Currency Banks named therein, Citibank, N.A., as Agentand Citibank Europe plc, UK Branch, as Local Currency Agent(incorporated by reference from Exhibit 10.5 to the Company’s Current Report on Form 8-K filed onJanuary 6, 2022)10.7Japan Local Currency Addendum to theThirdAmended and Restated Credit Agreement (Three-Year Facility), dated as of September1, 2022, among the Company, Caterpillar Finance Kabushiki Kaisha, the Japan Local Currency Banks named therein, Citibank, N.A., as Agentand MUFG Bank, Ltd., as Local Currency Agent(incorporated by reference from Exhibit 10.6 to the Company’s Current Report on Form 8-K filed on September6, 2022)





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10.8ThirdAmended and Restated Credit Agreement (Five-Year Facility), dated as of September1, 2022, by and among the Company, CaterpillarInc., Caterpillar International Finance Designated Activity Company and Caterpillar Finance Kabushiki Kaisha, certain financial institutions named therein, Citibank, N.A., as Agent, Citibank Europe plc, UK Branch, as Local Currency Agent, and MUFG Bank, Ltd., as Japan Local Currency Agent (incorporated by reference from Exhibit 10.7 to the Company’s Current Report on Form 8-K filed September6, 2022)10.9Local Currency Addendum to the Third Amended and Restated Credit Agreement (Five-Year Facility), dated as of September 1, 2022, among the Company, Caterpillar International Finance Designated Activity Company, the Local Currency Banks named therein, Citibank, N.A., as Agent and Citibank Europe plc, UK Branch, as Local Currency Agent (incorporated by reference from Exhibit 10.8to the Company’s Current Report on Form 8-K filed on January 6, 2022)10.10Japan Local Currency Addendum to the Third Amended and Restated Credit Agreement (Five-Year Facility), dated as of September 1, 2022, among the Company, Caterpillar Finance Kabushiki Kaisha, the Japan Local Currency Banks named therein, Citibank, N.A., as Agent and MUFG Bank, Ltd., as Local Currency Agent (incorporated by reference from Exhibit 10.9to the Company’s Current Report on Form 8-K filed on September 6, 2022)23Consent of Independent Registered Public Accounting Firm.31.1Certification of President, Director and Chief Executive Officer of Caterpillar Financial Services Corporation, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2Certification of Executive Vice President and Chief Financial Officer of Caterpillar Financial Services Corporation, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 200232Certification of President, Director and Chief Executive Officer of Caterpillar Financial Services Corporation, and Executive Vice President and Chief Financial Officer of Caterpillar Financial Services Corporation, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002101.INSInline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)101.SCHInline XBRL Taxonomy Extension Schema Document101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document101.LABInline XBRL Taxonomy Extension Label Linkbase Document101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document104Cover Page Interactive File (embedded within the Inline XBRL document and included in Exhibit 101)







Item 16.Form 10-K Summary
















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Caterpillar Financial Services CorporationFebruary 15, 2023/s/ James M, RooneyJames M. Rooney, Secretary











February 15, 2023/s/ David T. WaltonPresident, Director and Chief Executive OfficerDavid T. WaltonFebruary 15, 2023/s/ Andrew R.J. BonfieldDirectorAndrew R.J. BonfieldFebruary 15, 2023/s/ Kristen R. CoveyExecutive Vice President and Chief Financial Officer (Principal Financial Officer)Kristen R. CoveyFebruary 15, 2023/s/ Sumeet PuriController (Principal Accounting Officer)Sumeet Puri
















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202220212020Revenues:Retail finance$1,229$1,197$1,249Operating lease888942965Wholesale finance441314336Other, net176109—Total revenues2,7342,5622,550Expenses:Interest566455591Depreciation on equipment leased to others718755758General, operating and administrative531528433Provision for credit losses8170266Other243643Total expenses1,9201,8442,091Other income (expense)(83)(23)(25)Profit before income taxes731695434Provision for income taxes189178126Profit of consolidated companies542517308Less:  Profit attributable to noncontrolling interests71215Profit attributable to Caterpillar Financial Services Corporation$535$505$293













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202220212020Profit of consolidated companies$542$517$308Other comprehensive income (loss), net of tax (Note 9):Foreign currency translation(318)(209)236Derivative financial instruments333224Total Other comprehensive income (loss), net of tax(285)(177)260Comprehensive income (loss)257340568Less:  Comprehensive income (loss) attributable to noncontrolling interests(5)1425Comprehensive income (loss) attributable to Caterpillar Financial ServicesCorporation$262$326$543










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20222021Assets:Cash and cash equivalents$868$610Finance receivables, net of Allowance for credit losses of $346 and $33726,44127,177Notes receivable from Caterpillar482389Equipment on operating leases, net2,9113,123Other assets1,2551,088Total assets$31,957$32,387Liabilities and shareholder’s equity:Payable to dealers and others$163$163Payable to Caterpillar – borrowings and other12495Accrued expenses380233Short-term borrowings5,9545,395Current maturities of long-term debt5,2026,307Long-term debt16,21616,287Other liabilities955926Total liabilities28,99429,406Commitments and contingent liabilities (Note 10)Common stock - $1 par valueAuthorized:  2,000 shares; Issued andoutstanding:  one share (at paid-in amount)745745Additional paid-in capital22Retained earnings3,0572,797Accumulated other comprehensive income (loss)(1,047)(774)Noncontrolling interests206211Total shareholder’s equity2,9632,981Total liabilities and shareholder’s equity$31,957$32,387










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CommonstockAdditionalpaid-incapitalRetainedearningsAccumulatedothercomprehensiveincome (loss)NoncontrollinginterestsTotalBalance at December 31, 2019$745$2$3,162$(845)$172$3,236Profit of consolidated companies29315308Dividend paid to Caterpillar(300)(300)Foreign currency translation, net of tax22610236Derivative financial instruments, net of tax2424Adjustment to adopt new accounting guidance(1)(13)(13)Balance at December 31, 2020$745$2$3,142$(595)$197$3,491Profit of consolidated companies50512517Dividend paid to Caterpillar(850)(850)Foreign currency translation, net of tax(211)2(209)Derivative financial instruments, net of tax3232Balance at December 31, 2021$745$2$2,797$(774)$211$2,981Profit of consolidated companies5357542Dividend paid to Caterpillar(275)(275)Foreign currency translation, net of tax(306)(12)(318)Derivative financial instruments, net of tax3333Balance at December 31, 2022$745$2$3,057$(1,047)$206$2,963



















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202220212020Cash flows from operating activities:Profit of consolidated companies$542$517$308Adjustments for non-cash items:Depreciation and amortization732770772Accretion of Caterpillar purchased receivable revenue(417)(301)(308)Provision for credit losses8170266Other, net13090147Changes in assets and liabilities:Other assets1485939Payable to dealers and others383234Accrued expenses20(86)(83)Other payables with Caterpillar278(13)Other liabilities(46)30(14)Net cash provided by operating activities1,2551,1891,148Cash flows from investing activities:Expenditures for equipment on operating leases(1,121)(1,202)(1,086)Capital expenditures - excluding equipment on operating leases(18)(14)(14)Proceeds from disposals of equipment7561,041633Additions to finance receivables(14,217)(13,836)(13,525)Collections of finance receivables14,06113,34214,084Net changes in Caterpillar purchased receivables492(609)1,043Proceeds from sales of receivables575142Net change in variable lending to Caterpillar(2)13(12)Additions to other notes receivable from Caterpillar(139)(115)(75)Collections of other notes receivable from Caterpillar466927Settlements of undesignated derivatives(87)(3)(56)Other, net—11Net cash provided by (used for) investing activities(172)(1,262)1,062Cash flows from financing activities:Net change in variable lending from Caterpillar—(1,000)403Proceeds from debt issued (original maturities greater than three months)6,6746,4958,440Payments on debt issued (original maturities greater than three months)(7,703)(7,877)(8,211)Short-term borrowings, net (original maturities three months or less)5403,489(2,809)Dividend paid to Caterpillar(275)(850)(300)Net cash provided by (used for) financing activities(764)257(2,477)Effect of exchange rate changes on cash, cash equivalents and restricted cash(63)5(3)Increase (decrease) in cash, cash equivalents and restricted cash256189(270)Cash, cash equivalents and restricted cash at beginning of year(1)614425695Cash, cash equivalents and restricted cash at end of year(1)$870$614$425Cash paid for interest$544$472$613Cash paid for taxes, net$254$143$108All short-term investments, which consist primarily of highly liquid investments with original maturities of three months or less, are considered to be cash equivalents.(1)As of December 31, 2022, 2021 and 2020 restricted cash, which is included in Other assets in the Consolidated Statements of Financial Position, was $2 million, $4 million and $14 million, respectively. Restricted cash primarily includes cash related to syndication activities.










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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES























Basis of Presentation

















Finance Receivables





Finance receivables are generally classified as held for investment and recorded at amortized cost given that we have the intent and ability to hold them for the foreseeable future. Amortized cost is the principal balance outstanding plus accrued interest less write-downs, net of unamortized purchase discounts and deferred fees and costs.





Revenue Recognition











120

















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Other revenue includes: (1) late charges, (2) fee revenue, primarily commitment fees and fees on committed lines of credit or letters of credit, (3) gains and losses on sales of returned or repossessed equipment, (4) impairments on returned or repossessed equipment held for sale, (5) gains and losses on loan and lease sales and (6) other miscellaneous revenues. Other revenue items are recognized in accordance with relevant authoritative pronouncements.





Equipment on Operating Leases





We typically pay property taxes on operating leases directly to the taxing authorities and invoice the lessee for reimbursement. These property tax reimbursements are accounted for as variable lease payments and are included in Operating lease revenues in the Consolidated Statements of Profit. We individually assess our operating lease receivables for impairment. If collectability of a recorded operating lease receivable is not considered probable, we recognize a current-period adjustment against operating lease revenue.





Depreciation











Residual Values























Derivative Financial Instruments











Allowance for Credit Losses














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Income Taxes











We join Caterpillar in the filing of a consolidated U.S. Federal income tax return and certain state income tax returns. In accordance with our tax sharing agreement with Caterpillar, we generally pay to or receive from Caterpillar our allocated share of income taxes or credits reflected in these consolidated filings. This amount is calculated on a separate return basis by taking taxable income times the applicable statutory tax rate and includes payment for certain tax attributes earned during the year.





Foreign Currency Translation





The functional currency for most of our subsidiaries is the respective local currency. We include gains and losses resulting from the remeasurement of foreign currency amounts to the functional currency in Other income (expense) in the Consolidated Statements of Profit. We include gains and losses resulting from translating assets and liabilities from the functional currency to U.S. dollars in Accumulated other comprehensive income (loss) in the Consolidated Statements of Financial Position.





Estimates in Financial Statements


























ASUDescription2021-05Lessor – Variable lease payments





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FINANCE RECEIVABLES







(Millions of dollars)20222021Retail loans, net(1)$14,973$14,817Retail leases, net6,9657,818Caterpillar purchased receivables, net4,2974,462Wholesale loans, net(1)545406Wholesale leases, net711Total finance receivables26,78727,514Less: Allowance for credit losses(346)(337)Total finance receivables, net$26,441$27,177











(Millions of dollars)Amounts due inRetail loansRetail leasesCaterpillar purchased receivablesWholesale loansWholesale leasesTotal2023$6,521$2,865$4,334$343$3$14,06620243,8641,818—7415,75720252,7331,027—5613,81720261,518547—18—2,0832027545176—2—723Thereafter11740—1—158Total15,2986,4734,334494526,604Guaranteed residual value(1)12399—571469Unguaranteed residual value(1)2665—22671Unearned income(339)(572)(37)(8)(1)(957)Total$14,973$6,965$4,297$545$7$26,787

















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429 481 491






























































































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(Millions of dollars)December 31, 2022December 31, 2021Allowance for Credit Losses:CustomerDealerCaterpillarPurchased ReceivablesTotalCustomerDealerCaterpillar Purchased ReceivablesTotalBeginning Balance$251$82$4$337$431$44$4$479Write-offs(108)——(108)(256)——(256)Recoveries62——6251——51Provision for credit losses(1)75(17)—583038—68Other(3)——(3)(5)——(5)Ending Balance(2)$277$65$4$346$251$82$4$337Finance Receivables$20,353$2,137$4,297$26,787$20,842$2,210$4,462$27,514














30











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(Millions of dollars)December 31, 202220222021202020192018PriorRevolving Finance ReceivablesTotalFinanceReceivablesNorth AmericaCurrent$3,915$3,276$1,525$653$206$34$240$9,84931-60 days past due252618124149061-90 days past due915731—33891+ days past due111612643456EAMECurrent1,27095347728015568—3,20331-60 days past due1012711——3161-90 days past due8431———1691+ days past due62516411—53Asia/PacificCurrent1,174805393124375402,57831-60 days past due1012811——3261-90 days past due2542———1391+ days past due2664———18MiningCurrent87562722719394108802,20431-60 days past due—1—————161-90 days past due————————91+ days past due—————1—1Latin AmericaCurrent770400150692620—1,43531-60 days past due7842—1—2261-90 days past due2511———991+ days past due2131121——29Caterpillar Power FinanceCurrent8287146511816112567031-60 days past due————————61-90 days past due————————91+ days past due—————5—5Totals by Aging CategoryCurrent8,0866,1482,9181,37053639648519,93931-60 days past due5259371662417661-90 days past due21291571—37691+ days past due216045166104162Total$8,180$6,296$3,015$1,409$549$408$496$20,353








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(Millions of dollars)December 31, 202120212020201920182017PriorRevolving Finance ReceivablesTotalFinanceReceivablesNorth AmericaCurrent$4,792$2,596$1,426$630$182$32$182$9,84031-60 days past due2732201241510161-90 days past due78531153091+ days past due917121354565EAMECurrent1,49983657735214026—3,43031-60 days past due54311——1461-90 days past due3331———1091+ days past due31122—2—20Asia/PacificCurrent1,456943420119403363,01731-60 days past due1014102———3661-90 days past due3741———1591+ days past due210103———25MiningCurrent94435633219436161362,05931-60 days past due6——————661-90 days past due1———4——591+ days past due—18931—22Latin AmericaCurrent617299160701718—1,18131-60 days past due47331——1861-90 days past due3311———891+ days past due4997714—50Caterpillar Power FinanceCurrent1201521197018010410184631-60 days past due————————61-90 days past due————————91+ days past due—————44—44Totals by Aging CategoryCurrent9,4285,1823,0341,43559534435520,37331-60 days past due5257361861517561-90 days past due17211365156891+ days past due1848413415655226Total$9,515$5,308$3,124$1,493$621$411$370$20,842














62 78





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(Millions of dollars)December 31, 202231-60DaysPast Due61-90DaysPast Due91+DaysPast DueTotalPast DueCurrentTotal Finance ReceivablesNorth America$11$7$4$22$2,458$2,480EAME1—23812815Asia/Pacific62210555565Latin America921425406431Caterpillar Power Finance1——156Total$28$11$22$61$4,236$4,297





(Millions of dollars)December 31, 202131-60DaysPast Due61-90DaysPast Due91+DaysPast DueTotalPast DueCurrentTotal Finance ReceivablesNorth America$8$6$5$19$2,499$2,518EAME1—12844846Asia/Pacific——11620621Latin America11—2472474Caterpillar Power Finance————33Total$10$7$7$24$4,438$4,462








120








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(Millions of dollars)December 31, 2022December 31, 2021Amortized CostAmortized CostNon-accrual With an AllowanceNon-accrual Without an Allowance91+ Still AccruingNon-accrual With an AllowanceNon-accrual Without an Allowance91+ Still AccruingNorth America$52$4$11$47$9$12EAME43—101812Asia/Pacific11—719—7Mining—1—8114Latin America45——5241Caterpillar Power Finance511—4011—Total$156$16$28$184$26$36





17 12 12





62 78














no Finance receivables in the Customer portfolio segment modified as TDRs for the years ended December 31, were as follows:


(Dollars in millions)202220212020Pre-TDRAmortized CostPost-TDRAmortized CostPre-TDRAmortized CostPost-TDRAmortized CostPre-TDRAmortizedCostPost-TDRAmortized CostNorth America$6$6$6$6$13$13EAME1133——Asia/Pacific——441212Mining16161153535Latin America222212124545Caterpillar Power Finance20192622115115Total$65$64$62$52$220$220








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(Dollars in millions)202220212020Post-TDRAmortized CostPost-TDRAmortized CostPost-TDRAmortized CostNorth America$—$1$8EAME——10Asia/Pacific—62Mining5—10Latin America—151Caterpillar Power Finance—718Total$5$29$49








40 60







EQUIPMENT ON OPERATING LEASES








(Millions of dollars)20222021Equipment on operating leases, at cost$4,321$4,589Less: Accumulated depreciation(1,410)(1,466)Equipment on operating leases, net$2,911$3,123























3








(Millions of dollars)20232024202520262027ThereafterTotal$680$446$254$110$30$8$1,528





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OTHER ASSETS








(Millions of dollars)20222021Customer and other miscellaneous receivables$419$400Collateral held for resale, at net realizable value102168Deferred and refundable income taxes148126Property and equipment, net132133Other(1)454261Total Other assets$1,255$1,088










CREDIT COMMITMENTS








three 10.50 7.75





3.15 2.33


2.73 2.01


4.62 3.41





15.93 9.00





2.36 1 1.15 1





7.05 1 7.21 1 10 1





no








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3.49 979 559








2.38 1.75 ten years 23 482 22 389







SHORT-TERM BORROWINGS








(Millions of dollars)20222021BalanceWeighted Avg. RateBalanceWeighted Avg. RateCommercial paper, net$5,4554.2%$4,8960.1%Bank borrowings and other23411.4%2134.5%Variable denomination floating rate demand notes2653.4%2860.2%Total$5,954$5,395







LONG-TERM DEBT





6.01 5.21 800 5








(Millions of dollars)20222021BalanceWeighted Avg. RateBalanceWeighted Avg. RateMedium-term notes$20,8212.2%$22,2831.6%Unamortized discount and debt issuance costs(37)(40)Fair value adjustments(112)3Medium-term notes, net20,67222,246Bank borrowings and other7465.3%3484.1%Total$21,418$22,594








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(Millions of dollars)2023$5,20220247,39820254,51120262,46920271,948





14





900 900 900







DERIVATIVE FINANCIAL INSTRUMENTS AND RISK MANAGEMENT





























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(Millions of dollars)December 31, 2022December 31, 2021Assets1Liabilities2Assets1Liabilities2Designated derivativesForeign exchange contracts$305$(44)$142$(32)Interest rate contracts87(113)38(15)$392$(157)$180$(47)Undesignated derivativesForeign exchange contracts$25$(42)$28$(36)$25$(42)$28$(36)











13.18 13.85








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(Millions of dollars)Fair Value / Undesignated HedgesCash Flow HedgesGains (Losses)Recognized1Gains (Losses) Recognized in AOCIGains (Losses)Reclassified from AOCI2Year Ended December 31,202220212020202220212020202220212020Foreign exchange contracts$(111)$89$(112)$310$190$(130)$370$194$(132)Interest rate contracts(7)241511119(23)14(28)(52)$(118)$113$(97)$421$209$(153)$384$166$(184)














(Millions of dollars)Carry Value of the Hedged LiabilitiesCumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged LiabilitiesDecember 31, 2022December 31, 2021December 31, 2022December 31, 2021Current maturities of long-term debt$—$755$—$5Long-term debt2,0911,304(112)(2)Total$2,091$2,059$(112)$3





39




















(Millions of dollars)December 31, 2022December 31, 2021AssetsLiabilitiesAssetsLiabilitiesGross amounts recognized$417$(199)$208$(83)Financial instruments not offset(108)108(67)67Net amount$309$(91)$141$(16)








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417 208







ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)





Changes in Accumulated other comprehensive income (loss) included in the Consolidated Statements of Changes in Shareholder’s Equity consisted of the following:


(Millions of dollars)202220212020Foreign currency translationBalance at beginning of year$(762)$(551)$(777)Gains (losses) on foreign currency translation(276)(169)179Less: Tax provision/(benefit)3042(47)Net gains (losses) on foreign currency translation(306)(211)226Other comprehensive income (loss), net of tax(306)(211)226Balance at end of year$(1,068)$(762)$(551)Derivative financial instrumentsBalance at beginning of year$(12)$(44)$(68)Gains (losses) deferred421209(153)Less: Tax provision/(benefit)9724(33)Net gains (losses) deferred324185(120)(Gains) losses reclassified to earnings(384)(166)184Less: Tax (provision)/benefit(93)(13)40Net (gains) losses reclassified to earnings(291)(153)144Other comprehensive income (loss), net of tax333224Balance at end of year$21$(12)$(44)Total Accumulated other comprehensive income (loss) at end of year$(1,047)$(774)$(595)







COMMITMENTS AND CONTINGENT LIABILITIES
















1 26 36








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971 888 970 888








11.39
  888


















INCOME TAXES








(Millions of dollars)202220212020Taxes computed at U.S. statutory rates$15421.0%$14621.0%$9121.0%(Decreases) increases in taxes resulting from:State income tax, net of federal Tax40.5%30.4%(1)(0.2)%Non-U.S. subsidiaries taxed at other than the U.S. rate192.6%223.2%296.7%Valuation allowances152.1%50.7%102.3%Other, net(3)(0.4)%20.3%(3)(0.7)%Provision for income taxes$18925.8%$17825.6%$12629.1%











15 5 10





4





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(Millions of dollars)202220212020U.S.$439$288$99Non-U.S.292407335Total$731$695$434














(Millions of dollars)202220212020Current income tax provision:U.S.$116$101$46Non-U.S.9516280State (U.S.)551216268127Deferred income tax provision (benefit):U.S.(36)(56)(45)Non-U.S.8(33)46State (U.S.)1(1)(2)(27)(90)(1)Total Provision for income taxes$189$178$126











275 279





The amounts of deferred income taxes at December 31, included in the following lines in our Consolidated Statements of Financial Position were:





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(Millions of dollars)20222021Assets:Other assets$115$107Liabilities:Other liabilities(610)(592)Deferred income taxes, net$(495)$(485)








(Millions of dollars)20222021Deferred income tax assets:Allowance for credit losses$97$90Tax carryforwards9383Revenue timing differences2038Other, net2833238244Deferred income tax liabilities:Capital assets, including lease basis differences(461)(501)Deferred income tax on translation adjustment(219)(189)(680)(690)Valuation allowance for deferred income tax assets(53)(39)Deferred income taxes, net$(495)$(485)





73 5 1











363 41





51 1





As a result of improving profit before tax in one of our non-U.S. entities, we believe there is a reasonable possibility that a significant portion of the $23 million valuation allowance at December 31, 2022 recorded against the entity’s deferred tax assets may no longer be needed in 2023. Due to the uncertainty of inflation impacts on taxable income for one of our non-U.S. entities, we believe there is a reasonable possibility that we will need to record a valuation allowance in 2023 against some or all of the $36 million deferred tax asset at December 31, 2022. The potential amounts of the valuation allowance changes are dependent on each entity’s future taxable income.








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(Millions of dollars)202220212020Reconciliation of unrecognized income tax benefits(1):Balance at beginning of year$131$119$119Additions for income tax positions related to current year—2—Additions for income tax positions related to prior year—10—Reductions for income tax positions related to settlements(4)——Balance at end of year$127$131$119Amount that, if recognized, would impact the effective tax rate$127$131$119








1 1 1 2 1





We are subject to the continuous examination of our U.S. federal income tax returns by the IRS, and tax years 2017 to 2019 are currently under examination. In our major non-U.S. jurisdictions, tax years are typically subject to examination for three to ten years. Due to the uncertainty related to the timing and potential outcome of audits, we cannot estimate the range of reasonably possible change in unrecognized tax benefits in the next 12 months.







FAIR VALUE MEASUREMENTS









































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218 125














68 100























(Millions of dollars)20222021Carrying AmountFair ValueCarrying AmountFair ValueFair Value LevelsReferenceAssetsFinance receivables, net (excluding finance leases(1))$19,085$18,448$19,068$19,0473Note 2LiabilitiesLong-term debt$21,418$20,686$22,594$22,7972Note 7


7.36 8.11







TRANSACTIONS WITH RELATED PARTIES





275 850 300








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2.38 1.75


(Millions of dollars)202220212020Payable to Caterpillar - borrowings as of December 31,$23$22$1,022Payable to Caterpillar - other as of December 31,1017365Notes receivable from Caterpillar as of December 31,482389356Other receivables from Caterpillar as of December 31,(2)1337065Interest expense1—2Interest income on Notes Receivable with Caterpillar(1)171414














(Millions of dollars)202220212020Purchases made$47,158$40,140$32,937Revenue earned417301308Purchased Receivables as of December 31,4,2974,4623,646





339 351 353 143 147 24 25 22 17 17 15 448 568











52 52 46 13 12 10



















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SEGMENT AND GEOGRAPHIC INFORMATION


































































































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(Millions of dollars)2022External RevenuesProfitbefore income taxesInterestExpenseDepreciationon equipmentleased toothersProvisionforcreditlossesAssets atDecember 31, 2022CapitalexpendituresNorth America$1,512$550$263$503$25$15,229$862EAME285127955495,067117Asia/Pacific28313473563,9216Latin America284851361072,63625Mining294634214392,700120Caterpillar Power Finance5337152(15)704—Total Segments2,7118816087188130,2571,130Unallocated35(312)204——1,6289Timing(12)4———18—Methodology—158(246)——278—Inter-segment Eliminations(1)—————(224)—Total$2,734$731$566$718$81$31,957$1,1392021External RevenuesProfitbefore income taxesInterestExpenseDepreciationon equipmentleased toothersProvisionforcreditlossesAssets atDecember 31, 2021CapitalexpendituresNorth America$1,401$419$250$542$15$15,755$888EAME274732160305,19292Asia/Pacific34017084794,11710Latin America20224688522,40512Mining2899837136(15)2,672206Caterpillar Power Finance5241132(21)957—Total Segments2,5588254737557031,0981,208Unallocated15(295)179——1,4588Timing(11)6———15—Methodology—159(197)——18—Inter-segment Eliminations(1)—————(202)—Total$2,562$695$455$755$70$32,387$1,2162020External RevenuesProfitbefore income taxesInterestExpenseDepreciationon equipmentleased toothersProvisionforcreditlossesAssets atDecember 31, 2020CapitalexpendituresNorth America$1,401$312$322$538$69$14,749$864EAME271443762504,98137Asia/Pacific338145949384,5857Latin America201417011332,6217Mining2793353137272,575151Caterpillar Power Finance54(38)251501,30823Total Segments2,54453760175826730,8191,089Unallocated25(287)207—(1)1,57611Timing(19)(3)———12—Methodology—187(217)——(152)—Inter-segment Eliminations(1)—————(264)—Total$2,550$434$591$758$266$31,991$1,100








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(Millions of dollars)202220212020RevenuesInside U.S.$1,551$1,422$1,443All other1,1831,1401,107Total$2,734$2,562$2,550Equipment on operating leases, net and property  and equipment, net (included in Other assets)20222021Inside U.S.$2,036$2,179Inside Canada507545All other500532Total$3,043$3,256