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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________________________________ 
FORM 10-Q
(Mark One)
ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31,September 30, 2017
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ________________
Commission file number 1-10667
______________________________________________ 
General Motors Financial Company, Inc.
(Exact name of registrant as specified in its charter)
State of Texas 75-2291093
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
801 Cherry Street, Suite 3500, Fort Worth, Texas 76102
(Address of principal executive offices, including Zip Code)
(817) 302-7000
(Registrant’s telephone number, including area code) 
Not applicable
(Former name, former address and former fiscal year, if changed since last report) 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  Q    No  o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter)during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  Q    No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated fileroAccelerated fileroNon-accelerated filer (Do not check if a smaller reporting company)ýSmaller reporting companyoEmerging growth companyo
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes o No o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o    No  Q 
As of April 27,October 23, 2017, there were 5055,050,000 shares of the registrant’s common stock, par value $1.00$0.0001 per share, outstanding. All of the registrant’s common stock is owned by General Motors Holdings LLC.



INDEX
 
  Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
       PART II
 
 


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GENERAL MOTORS FINANCIAL COMPANY, INC.

PART I
Item 1. Condensed Consolidated Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)millions, except per share amounts) (Unaudited)
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
ASSETS      
Cash and cash equivalents$2,694
 $3,201
$3,976
 $2,815
Finance receivables, net (Note 4; Note 8 VIEs)
46,910
 43,190
40,864
 33,475
Leased vehicles, net (Note 5; Note 8 VIEs)
37,302
 34,526
41,775
 34,342
Goodwill1,200
 1,196
1,201
 1,196
Equity in net assets of non-consolidated affiliates (Note 6)
998
 944
Property and equipment, net of accumulated depreciation of $147 and $127291
 279
Deferred income taxes284
 274
Equity in net assets of non-consolidated affiliate (Note 6)
1,119
 944
Related party receivables (Note 3)
617
 510
339
 347
Other assets (Note 8 VIEs)
4,244
 3,645
4,767
 3,695
Assets held for sale (Note 2)
12,094
 10,951
Total assets$94,540
 $87,765
$106,135
 $87,765
LIABILITIES AND SHAREHOLDER'S EQUITY   
LIABILITIES AND SHAREHOLDERS' EQUITY   
Liabilities      
Secured debt (Note 7; Note 8 VIEs)
$42,579
 $39,270
$40,775
 $35,087
Unsecured debt (Note 7)
37,370
 34,606
38,263
 29,476
Accounts payable and accrued expenses1,501
 1,474
Deferred income2,588
 2,365
3,066
 2,355
Deferred income taxes259
 220
Related party payables (Note 3)
448
 400
253
 320
Other liabilities803
 737
2,449
 2,141
Liabilities held for sale (Note 2)
10,858
 9,693
Total liabilities85,548
 79,072
95,664
 79,072
Commitments and contingencies (Note 10)

 

 
Shareholder's equity   
Common stock, $1.00 par value per share, 1,000 shares authorized and 505 shares issued
 
Shareholders' equity   
Common stock, $0.0001 par value per share, 10,000,000 shares authorized and 5,050,000 shares issued (Note 11)

 
Preferred stock, $0.01 par value per share, 250,000,000 shares authorized and 1,000,000 shares issued (Note 11)

 
Additional paid-in capital6,512
 6,505
7,514
 6,505
Accumulated other comprehensive loss (Note 13)
(1,148) (1,238)
Accumulated other comprehensive loss (Note 14)
(935) (1,238)
Retained earnings3,628
 3,426
3,892
 3,426
Total shareholder's equity8,992
 8,693
Total liabilities and shareholder's equity$94,540
 $87,765
Total shareholders' equity10,471
 8,693
Total liabilities and shareholders' equity$106,135
 $87,765
The accompanying notes are an integral part of these condensed consolidated financial statements.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions)(Unaudited)
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Revenue       
Finance charge income$837
 $721
 $2,401
 $2,110
Leased vehicle income2,244
 1,582
 6,282
 4,144
Other income80
 57
 216
 175
Total revenue3,161
 2,360
 8,899
 6,429
Costs and expenses       
Salaries and benefits224
 195
 621
 536
Other operating expenses122
 132
 388
 360
Total operating expenses346
 327
 1,009
 896
Leased vehicle expenses1,670
 1,197
 4,648
 3,148
Provision for loan losses204
 167
 573
 501
Interest expense672
 511
 1,903
 1,393
Total costs and expenses2,892
 2,202
 8,133
 5,938
Equity income (Note 6)
41
 36
 129
 109
Income from continuing operations before income taxes310
 194
 895
 600
Income tax provision (Note 12)
124
 60
 260
 185
Income from continuing operations186
 134
 635
 415
Income (loss) from discontinued operations, net of tax (Note 2)
16
 13
 (169) 85
Net income$202
 $147
 $466
 $500
        
Net income attributable to common shareholder$200
 $147
 $464
 $500
        

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(In millions) (Unaudited)
 Three Months Ended March 31,
 2017 2016
Revenue   
Finance charge income$862
 $818
Leased vehicle income1,942
 1,184
Other income75
 73
Total revenue2,879
 2,075
Costs and expenses   
Salaries and benefits229
 193
Other operating expenses163
 141
Total operating expenses392
 334
Leased vehicle expenses1,438
 893
Provision for loan losses217
 196
Interest expense619
 463
Total costs and expenses2,666
 1,886
Equity income (Note 6)
47
 36
Income before income taxes260
 225
Income tax provision (Note 11)
58
 61
Net income202
 164
Other comprehensive income, net of tax   
Unrealized (loss) income on cash flow hedges, net of income tax benefit of $3(4) 
Defined benefit plans, net of income tax
 (1)
Foreign currency translation adjustment, net of income tax expense of $4 and $094
 153
Other comprehensive income, net of tax90
 152
Comprehensive income$292
 $316
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Net income$202
 $147
 $466
 $500
Other comprehensive income (loss), net of tax       
Unrealized loss on cash flow hedges, net of income tax benefit of $2, $1, $10 and $3(3) (1) (14) (5)
Defined benefit plans, net of income tax
 
 (1) 
Foreign currency translation adjustment, net of income tax expense of $21, $0, $30 and $0120
 (10) 318
 60
Other comprehensive income (loss), net of tax117
 (11) 303
 55
Comprehensive income$319
 $136
 $769
 $555

The accompanying notes are an integral part of these condensed consolidated financial statements.


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GENERAL MOTORS FINANCIAL COMPANY, INC.


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions) (Unaudited)
Three Months Ended March 31,Nine Months Ended September 30,
2017 20162017 2016
Net cash provided by operating activities - continuing operations$4,795
 $3,566
Net cash provided by operating activities - discontinued operations243
 290
Net cash provided by operating activities$1,416
 $1,158
5,038
 3,856
Cash flows from investing activities      
Purchases of retail finance receivables, net(6,401) (4,165)(15,267) (10,408)
Principal collections and recoveries on retail finance receivables3,595
 3,271
9,410
 7,368
Net funding of commercial finance receivables(541) (1,024)(1,557) (1,145)
Purchases of leased vehicles, net(4,794) (5,158)(14,809) (14,939)
Proceeds from termination of leased vehicles1,082
 481
4,649
 1,799
Purchases of property and equipment(24) (20)
Other investing activities
 1
(65) (59)
Net cash used in investing activities - continuing operations(17,639) (17,384)
Net cash used in investing activities - discontinued operations(468) (949)
Net cash used in investing activities(7,083) (6,614)(18,107) (18,333)
Cash flows from financing activities      
Net change in debt (original maturities less than three months)(268) 757
(305) (301)
Borrowings and issuance of secured debt8,361
 7,054
26,731
 18,420
Payments on secured debt(4,805) (5,251)(20,905) (12,525)
Borrowings and issuance of unsecured debt2,968
 3,131
12,626
 10,358
Payments on unsecured debt(574) (241)(4,375) (2,345)
Debt issuance costs(27) (26)(131) (112)
Proceeds from issuance of preferred stock985
 
Net cash provided by financing activities - continuing operations14,626
 13,495
Net cash provided by financing activities - discontinued operations63
 601
Net cash provided by financing activities5,655
 5,424
14,689
 14,096
Net decrease in cash, cash equivalents and restricted cash(12) (32)
Net increase (decrease) in cash, cash equivalents and restricted cash1,620
 (381)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash37
 58
112
 22
Cash, cash equivalents and restricted cash at beginning of period5,302
 5,002
5,302
 5,002
Cash, cash equivalents and restricted cash at end of period$5,327
 $5,028
$7,034
 $4,643
Cash, cash equivalents and restricted cash from continuing operations at end of period$6,469
 $3,918
Cash, cash equivalents and restricted cash from discontinued operations at end of period$565
 $725
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet:
March 31, 2017September 30, 2017
Cash and cash equivalents$2,694
$3,976
Restricted cash included in other assets2,633
2,493
Total$5,327
$6,469
The accompanying notes are an integral part of these condensed consolidated financial statements.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Basis of Presentation The condensed consolidated financial statements include our accounts and the accounts of our consolidated subsidiaries, including certain special-purpose financing entities utilized in secured financing transactions, which are considered variable interest entities (VIEs). We consolidate certain operating entities that provide auto finance and financial services, which we do not control through a majority voting interest. We manage these entities and maintain a controlling financial interest in them and are exposed to the risks of ownership through contractual arrangements. The majority voting interests in these entities are indirectly wholly-owned by our parent, General Motors Company (GM). All intercompany transactions and balances have been eliminated in consolidation.
Our operations in Europe are presented as discontinued operations, and the related assets and liabilities are presented as held for sale in our condensed consolidated financial statements for all periods presented. Unless otherwise indicated, information in these notes to the condensed consolidated financial statements relates to continuing operations. Refer to Note 2 - "Discontinued Operations" for additional details regarding our planned disposal of these operations.
The interim period condensed consolidated financial statements, including the notes thereto, are condensed and do not include all disclosures required by generally accepted accounting principles (GAAP) in the United States of America. These interim period condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements that are included in our Annual Report on Form 10-K filed on February 7, 2017 (Form 10-K). Except as otherwise specified, dollar amounts presented within tables are stated in millions.
The condensed consolidated financial statements at March 31,September 30, 2017, and for the three and nine months ended March 31,September 30, 2017 and 2016, are unaudited and, in management’s opinion, include all adjustments, consistingwhich consist of normal recurring adjustments and transactions or events discretely impacting the interim periods, considered necessary for a fair presentationby management to fairly state our results of the results for such interim periods.operations. The results for interim periods are not necessarily indicative of results for a full year.
In August 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" (ASU 2017-12), which simplifies the application of hedge accounting and more closely aligns hedge accounting with companies' risk management strategies thereby making more hedging strategies eligible for hedge accounting. ASU 2017-12 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption permitted. ASU 2017-12 requires a cumulative-effect adjustment for certain items upon adoption. We are currently evaluating the impact the adoption of ASU 2017-12 will have on our consolidated financial statements.
Segment InformationWe are the wholly-owned captive finance subsidiary of General Motors Company (GM).GM. We offer substantially similar products and services throughout many different regions, subject to local regulations and market conditions. We evaluate our business in two operating segments. The North America Segment includes our operations in the U.S. and Canada. The International Segment includes our operations in all other countries.Brazil, Chile, Colombia, Mexico and Peru as well as our equity investment in SAIC-GMAC Automotive Finance Company Limited (SAIC-GMAC), a joint venture that conducts auto finance operations in China.
Note 2. Disposition of BusinessDiscontinued Operations
On March 5, 2017, General Motors Holdings LLC, a wholly-owned subsidiary of GM and our parent, entered into a Master Agreement (the Agreement) with Peugeot S.A. (PSA Group) pursuantPursuant to which PSA Group will acquire GM'sthe Agreement, Peugeot S.A. acquired on July 31, 2017 GM’s Opel and Vauxhall businesses and certain other assets in Europe (the Opel/Vauxhall Business) and will acquire, together with a financial partner, certain of our European financial subsidiaries and branches (European(collectively, our European Operations and, together with the Opel/Vauxhall Business, GM's European Business). The transfer of our European Operations is expected to close by the Transferred Business).end of the year subject to the receipt of the necessary regulatory approvals and satisfaction of other closing conditions.
The net consideration to be paid for our European Operations will be 0.8 times their book value at closing, whichclosing. Based on exchange rates at September 30, 2017, we estimate the net consideration will be approximately $1$1.1 billion, denominated in Euros.and we currently expect to recognize a disposal loss of approximately $500 million, subject to foreign currency fluctuations, which have had a favorable impact on the estimated loss. The purchase price is subject to certain adjustments as provided in the Agreement. During the nine months ended September 30, 2017, we recognized a portion of the disposal loss in accordance with ASC 360 - "Property, Plant and Equipment." We expect to recognize athe remainder of the disposal loss of approximately $700 million to $800 million at closing.
The transferthe closing of the Opel/Vauxhall Business is expected to close bytransaction.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The following table summarizes the endassets and liabilities held for sale:
 September 30, 2017 December 31, 2016
ASSETS   
Cash and cash equivalents$242
 $386
Finance receivables, net11,303
 9,715
Related party receivables
 163
Other assets549
 687
Total assets held for sale$12,094
 $10,951
LIABILITIES   
Secured debt$4,872
 $4,183
Unsecured debt5,469
 5,130
Related party payables
 80
Other liabilities517
 300
Total liabilities held for sale$10,858
 $9,693
The following table summarizes the results of 2017 andoperations for the transfer of our European Operations is expected to close as soon as practicable after the receipt of the necessary antitrust, financial and other regulatory approvals, which may be after the transfer of the Opel/Vauxhall Business, but not before. The transfer of our European Operations will not occur unless the transfer of the Opel/Vauxhall Business occurs.discontinued operations:
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Total revenue$148
 $138
 $422
 $436
Interest expense24
 30
 70
 112
Other expenses75
 74
 231
 205
Total costs and expenses99
 104
 301
 317
Income from discontinued operations before income taxes49
 34
 121
 119
Loss on sale of discontinued operations before income taxes38
 
 374
 
Income (loss) from discontinued operations before income taxes11
 34
 (253) 119
Income tax (benefit) provision(5) 21
 (84) 34
Income (loss) from discontinued operations, net of tax$16
 $13
 $(169) $85
Note 3. Related Party Transactions
We offer loan and lease finance products through GM-franchised dealers to customers purchasing new vehicles manufactured by GM and certain used vehicles manufactured by GM and make commercial loans directly to GM-franchised dealers and their affiliates. We also offer commercial loans to dealers that are consolidated by GM and those balances are included in our finance receivables, net.
Under subvention programs, GM makes cash payments to us for offering incentivized rates and structures on retail loan and lease finance products. In addition, GM makes payments to us to cover certain interest payments on commercial loans. We also provide funding under lines of credit to GM.
In March 2017, we executed an agreement to purchase certain program vehicles from Maven Drive LLC (Maven), a wholly-owned subsidiary of GM. We simultaneously leased these vehicles to Maven for use in their ride-sharing arrangements. We account for these leases as direct-financedirect-financing leases, which are included in our finance receivables, net.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


We have related party payables due to GM, primarily for commercial finance receivables originated but not yet funded. These payables typically settle within 30 days. The following tables present related party transactions:
Balance Sheet DataMarch 31, 2017 December 31, 2016
Commercial finance receivables, net due from dealers consolidated by GM(a)
$339
 $401
Direct-finance lease receivables from Maven(a)
$128
 $
Advances drawn on lines of credit due from GM(b)
$145
 $137
Subvention receivable(c)
$471
 $373
Commercial loan funding payable(d)
$438
 $389
Balance Sheet DataSeptember 30, 2017 December 31, 2016
Commercial finance receivables, net due from dealers consolidated by GM(a)
$349
 $347
Direct-financing lease receivables from Maven(a)
$96
 $
Subvention receivable(b)
$338
 $347
Commercial loan funding payable(c)
$251
 $320
Three Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
Income Statement Data2017 20162017 2016 2017 2016
Interest subvention earned on retail finance receivables and leases(e)
$111
 $103
Interest subvention earned on retail finance receivables(d)
$115
 $90
 $319
 $245
Interest subvention earned on commercial finance receivables(e)(d)
$40
 $40
$14
 $13
 $42
 $35
Leased vehicle subvention earned(f)(e)
$709
 $459
$786
 $591
 $2,246
 $1,588
_________________
(a)Included in finance receivables, net.
(b)Included in related party receivables. We received subvention payments from GM of $1.1 billion and $1.0 billion for the three months ended September 30, 2017 and 2016, and $3.3 billion and $3.2 billion for the nine months ended September 30, 2017 and 2016.
(c)Included in related party receivables. We received subvention payments from GM of $1.0 billion and $1.2 billion for the three months ended March 31, 2017 and 2016.payables.
(d)Included in related party payables.
(e)Included in finance charge income.
(f)(e)Included as a reduction to leased vehicle expenses.
Under our support agreement with GM (the Support Agreement), if our earning assets leverage ratio at the end of any calendar quarter exceeds the applicable threshold set in the Support Agreement, we may require GM to provide funding sufficient to bring our earning assets leverage ratio to within the applicable threshold. In determining our earning assets leverage ratio (net earning assets divided by adjusted equity) under the Support Agreement, net earning assets means our finance receivables, net, plus leased vehicles, net, and adjusted equity means our equity, net of goodwill and inclusive of outstanding junior subordinated debt, as each may be adjusted for derivative accounting from time to time. 
Additionally, the Support Agreement provides that GM will own all of our outstanding voting shares as long as we have any unsecured debt securities outstanding and that GM will use its commercially reasonable efforts to ensure that we will continue to be designated as a subsidiary borrower of up to $4.0 billion under GM’s corporate revolving credit facilities. We have the ability to borrow up to $1.0 billion under GM's three-year, $4.0 billion unsecured revolving credit facility and $3.0 billion under GM's five-year, $10.5 billion unsecured revolving credit facility, subject to available capacity. GM also agreed to certain provisions in the Support Agreement intended to ensure that we maintain adequate access to liquidity. Pursuant to these provisions, GM provided us with a $1.0 billion junior subordinated unsecured intercompany revolving credit facility (the Junior Subordinated Revolving Credit Facility).
We are included in GM's consolidated U.S. federal income tax returns. For taxable income we recognize in any period beginning on or after October 1, 2010, we are obligated to pay GM for our share of the consolidated U.S. federal and certain state tax liabilities. Amounts owed to GM for income taxes are accrued and recorded as a related party payable. At March 31,September 30, 2017 and December 31, 2016, there are no related party taxes payable to GM due to our taxable loss position.  

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Note 4. Finance Receivables
March 31, 2017 December 31, 2016
September 30, 2017 December 31, 2016
Retail finance receivables      
Retail finance receivables, collectively evaluated for impairment, net of fees(a)
$34,047
 $30,989
$30,147
 $24,480
Retail finance receivables, individually evaluated for impairment, net of fees1,957
 1,921
2,170
 1,920
Total retail finance receivables, net of fees(b)(a)
36,004
 32,910
32,317
 26,400
Less: allowance for loan losses - collective(568) (517)(571) (489)
Less: allowance for loan losses - specific(284) (276)(328) (276)
Total retail finance receivables, net35,152
 32,117
31,418
 25,635
Commercial finance receivables      
Commercial finance receivables, collectively evaluated for impairment, net of fees11,725
 11,053
9,468
 7,853
Commercial finance receivables, individually evaluated for impairment, net of fees87
 70
27
 27
Total commercial finance receivables, net of fees11,812
 11,123
9,495
 7,880
Less: allowance for loan losses - collective(46) (43)(46) (36)
Less: allowance for loan losses - specific(8) (7)(3) (4)
Total commercial finance receivables, net11,758
 11,073
9,446
 7,840
Total finance receivables, net$46,910
 $43,190
$40,864
 $33,475
Fair value of finance receivables$46,722
 $43,140
$40,957
 $33,528
________________
(a) Includes $1.6 billion and $1.3 billion of direct-finance leases at March 31, 2017 and December 31, 2016.
(b) Net of unearned income, unamortized premiums and discounts, and deferred fees and costs of $199$282 million and $191$178 million at March 31,September 30, 2017 and December 31, 2016.

We estimate 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 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 our cash flow model. A substantial majority of our commercial finance receivables have variable interest rates. The carrying amount, a Level 2 input, is considered to be a reasonable estimate of fair value.
Retail Finance ReceivablesThree Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
2017 20162017 2016 2017 2016
Allowance for retail loan losses beginning balance$793
 $735
$844
 $790
 $765
 $713
Provision for loan losses213
 197
204
 164
 563
 497
Charge-offs(307) (293)(286) (284) (856) (826)
Recoveries147
 150
135
 128
 420
 403
Foreign currency translation6
 7
2
 (2) 7
 9
Allowance for retail loan losses ending balance$852
 $796
$899
 $796
 $899
 $796


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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Retail Credit Quality Our retail finance receivables portfolio includes loans made to consumers and businesses to finance the purchase of vehicles for personal and commercial use. We use proprietary scoring systems in the underwriting process that measure the credit quality of the receivables using several factors, such as credit bureau information, consumer credit risk scores (e.g. FICO score or its equivalent), and contract characteristics. We also consider other factors, such as employment history, financial stability and capacity to pay. At the time of loan origination, substantially all of our International Segment customers have the equivalent of prime credit scores. In the North America, Segment, while we historically focused on consumers with lower than prime credit scores, we have expanded our prime lending programs. A summary of the credit risk profile by FICO score band or equivalent scores, determined at origination, of the retail finance receivables in the North America Segment is as follows:
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Amount Percent Amount PercentAmount Percent Amount Percent
Prime - FICO Score 680 and greater$10,062
 41.3% $7,923
 36.4%$12,332
 45.7% $7,923
 36.4%
Near-prime - FICO Score 620 to 6793,742
 15.4
 3,468
 15.9
4,194
 15.6
 3,468
 15.9
Sub-prime - FICO Score less than 62010,550
 43.3
 10,395
 47.7
10,443
 38.7
 10,395
 47.7
Balance at end of period$24,354
 100.0% $21,786
 100.0%$26,969
 100.0% $21,786
 100.0%
In addition, we review the credit quality of our retail finance receivables based on customer payment activity. A retail account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date such payment was contractually due. Retail finance receivables are collateralized by vehicle titles and, subject to local laws, we generally have the right to repossess the vehicle in the event the customer defaults on the payment terms of the contract. The following is a consolidated summary of the contractual amounts of delinquent retail finance receivables, which is not significantly different than the recorded investment for such receivables.
March 31, 2017 March 31, 2016September 30, 2017 September 30, 2016
Total Percent of Contractual Amount Due Total Percent of Contractual Amount DueAmount Percent of Contractual Amount Due Amount Percent of Contractual Amount Due
31 - 60 days$1,006
 2.8% $963
 3.1%$1,176
 3.6% $1,112
 4.4%
Greater than 60 days441
 1.2
 421
 1.4
521
 1.6
 491
 1.9
Total finance receivables more than 30 days delinquent1,447
 4.0
 1,384
 4.5
1,697
 5.2
 1,603
 6.3
In repossession51
 0.1
 48
 0.2
55
 0.2
 57
 0.2
Total finance receivables more than 30 days delinquent or in repossession$1,498
 4.1% $1,432
 4.7%$1,752
 5.4% $1,660
 6.5%
At March 31,September 30, 2017 and December 31, 2016, the accrual of finance charge income had been suspended on retail finance receivables with contractual amounts due of $711$797 million and $807$798 million.
Impaired Retail Finance Receivables - TDRs Retail finance receivables that become classified as troubled debt restructurings (TDRs) are separately assessed for impairment. A specific allowance is estimated based on the present value of the expected future cash flows of the receivable discounted at the loan's original effective interest rate. Accounts that become classified as TDRs because of a payment deferral accrue interest at the contractual rate and an additional fee is collected (where permitted) at each time of deferral and recorded as a reduction of accrued interest. No interest or fees are forgiven on a payment deferral to a customer; therefore, there are no additional financial effects of deferred loans becoming classified as TDRs. Accounts in the U.S. in Chapter 13 bankruptcy would have already been placed on non-accrual; therefore, there are no additional financial effects from these loans becoming classified as TDRs. Finance charge income from loans classified as TDRs is accounted for in the same manner as other accruing loans. Cash collections on these loans are allocated according to the same payment hierarchy methodology applied to loans that are not classified as TDRs.

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At March 31, 2017 and December 31, 2016, the outstanding balance of retail finance receivables in the International Segment determined to be TDRs was insignificant; therefore, the following information is presented with regard to the TDRs in the North America Segment only. The outstanding recorded investment for retail finance receivables that are considered to be TDRs and the related allowance is presented below:
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Outstanding recorded investment$1,957
 $1,920
$2,170
 $1,920
Less: allowance for loan losses(284) (276)(328) (276)
Outstanding recorded investment, net of allowance$1,673
 $1,644
$1,842
 $1,644
Unpaid principal balance$1,998
 $1,967
$2,210
 $1,967
Additional information about loans classified as TDRs is presented below:
Three Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
2017 20162017 2016 2017 2016
Average outstanding recorded investment$1,939
 $1,636
$2,091
 $1,785
 $2,045
 $1,725
Finance charge income recognized$60
 $51
$56
 $55
 $173
 $156
Number of loans classified as TDRs during the period16,474
 14,646
23,015
 18,548
 56,853
 49,327
Recorded investment of loans classified as TDRs during the period$287
 $254
$407
 $315
 $997
 $846
The unpaid principal balance, net of recoveries, of loans that were charged off during the reporting period and were within 12 months of being modified as a TDR were insignificant for the three and nine months ended March 31,September 30, 2017 and 2016.
Commercial Finance Receivables
Commercial Credit Quality We extend wholesale credit to dealersOur commercial finance receivables consist of dealer financings, primarily in the form of approved lines of credit to purchase new vehicles as well asfor inventory purchases. A proprietary model is used vehicles. Each commercial lending request is evaluated, taking into consideration the borrower's financial condition and the underlying collateral for the loan. We use proprietary models to assign each dealer a risk rating. These models use historical performance datarating to identify key factors about a dealer that we consider significant in predicting a dealer's ability to meet its financial obligations. We also consider numerous other financial and qualitative factors including, but not limited to, capitalization and leverage, liquidity and cash flow, profitability and credit history. 
We regularly review our models to confirm the continued business significance and statistical predictability of the factors and update the models to incorporate new factors or other information that improves statistical predictability. In addition, we verify the existence of the assets collateralizing the receivables by physical audits of vehicle inventories, which are performed with increased frequency for higher risk dealers (i.e., Groups III, IV, V and VI).each dealer. We perform periodic credit reviews of each dealership and adjust the dealership's risk rating, if necessary. Dealers in Group VI are subject to additional restrictions on funding, restrictions including suspension of lines of credit and liquidation of assets.
Performance of our commercial finance receivables is evaluated based on our internal dealer risk rating analysis, as payment for wholesale receivables is generally not required until the dealer has sold or leased the vehicle inventory. All receivables from the same dealer customer share the same risk rating. The following table summarizes the credit risk profile by dealer risk rating of commercial finance receivables: 
 March 31, 2017 December 31, 2016 September 30, 2017 December 31, 2016
 Amount Percent Amount Percent Amount Percent Amount Percent
Group I-Dealers with superior financial metrics$1,664
 14.1% $1,596
 14.3%-Dealers with superior financial metrics$1,547
 16.3% $1,389
 17.6%
Group II-Dealers with strong financial metrics3,804
 32.2
 3,445
 31.0
-Dealers with strong financial metrics3,565
 37.5
 2,661
 33.8
Group III-Dealers with fair financial metrics4,171
 35.3
 4,039
 36.3
-Dealers with fair financial metrics3,112
 32.8
 2,775
 35.2
Group IV-Dealers with weak financial metrics1,441
 12.2
 1,231
 11.1
-Dealers with weak financial metrics931
 9.8
 631
 8.0
Group V-Dealers warranting special mention due to potential weaknesses548
 4.6
 642
 5.8
-Dealers warranting special mention due to elevated risks238
 2.5
 334
 4.2
Group VI-Dealers with loans classified as substandard, doubtful or impaired184
 1.6
 170
 1.5
-Dealers with loans classified as substandard, doubtful or impaired102
 1.1
 90
 1.2
Balance at end of periodBalance at end of period$11,812
 100.0% $11,123
 100.0%Balance at end of period$9,495
 100.0% $7,880
 100.0%
At September 30, 2017 and December 31, 2016, substantially all of our commercial finance receivables were current with respect to payment status. Commercial finance receivables on non-accrual status were insignificant, and none were classified as TDRs. Activity in the allowance for commercial loan losses was insignificant for the three and nine months ended September 30, 2017 and 2016.

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At March 31, 2017 and December 31, 2016, substantially all of our commercial finance receivables were current with respect to payment status and none were classified as TDRs. Activity in the allowance for commercial loan losses was insignificant for the three months ended March 31, 2017 and 2016.
Note 5. Leased Vehicles
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Leased vehicles$53,000
 $48,581
$60,112
 $48,340
Manufacturer subvention(8,372) (7,706)(9,265) (7,686)
44,628
 40,875
50,847
 40,654
Less: accumulated depreciation(7,326) (6,349)(9,072) (6,312)
Leased vehicles, net$37,302
 $34,526
$41,775
 $34,342
The following table summarizes minimum rental payments due to us as lessor under operating leases:
 Years Ending December 31,
 2017 2018 2019 2020 2021
Minimum rental payments under operating leases$4,654
 $4,878
 $2,494
 $365
 $13
 Years Ending December 31,
 2017 2018 2019 2020 2021
Minimum rental payments under operating leases$1,800
 $6,256
 $3,861
 $1,182
 $110
Note 6. Equity in Net Assets of Non-consolidated AffiliatesAffiliate
We use the equity method to account for our equity interest in SAIC-GMAC, Automotive Finance Company Limited (SAIC-GMAC), a joint venture that conducts auto finance operations in China. The income of SAIC-GMAC is not consolidated into our financial statements; rather, our proportionate share of the earnings is reflected as equity income.
 Three Months Ended September 30, Nine Months Ended September 30,
Summarized Operating Data(a)
2017 2016 2017 2016
Finance charge income$261
 $229
 $775
 $700
Provision for loan losses$2
 $7
 $(9) $21
Interest expense$83
 $65
 $241
 $192
Income before income taxes$157
 $137
 $490
 $411
Net income$118
 $103
 $368
 $308
_________________
(a)This data represents that of the entire entity and not our 35% proportionate share.
There were no cash dividends received from SAIC-GMAC during the threenine months ended March 31,September 30, 2017. We received cash dividends from SAIC-GMAC of $27$129 million during the threenine months ended March 31,September 30, 2016. At MarchSeptember 30, 2017 and December 31, 20172016 we had undistributed earnings of $189$271 million and $142 million related to SAIC-GMAC.
Note 7. Debt
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Carrying Amount Fair Value Carrying Amount Fair ValueCarrying Amount Fair Value Carrying Amount Fair Value
Secured debt              
Revolving credit facilities$11,865
 $11,866
 $9,817
 $9,812
$4,751
 $4,769
 $8,503
 $8,498
Securitization notes payable30,714
 30,814
 29,453
 29,545
36,024
 36,120
 26,584
 26,664
Total secured debt$42,579
 $42,680
 $39,270
 $39,357
40,775
 40,889
 35,087
 35,162
Unsecured debt              
Senior notes$31,088
 $32,103
 $28,577
 $29,182
34,794
 35,927
 26,737
 27,304
Credit facilities3,453
 3,452
 3,354
 3,354
2,162
 2,174
 1,961
 1,961
Retail customer deposits1,913
 1,917
 1,895
 1,902
Other unsecured debt916
 918
 780
 782
1,307
 1,310
 778
 780
Total unsecured debt$37,370
 $38,390
 $34,606
 $35,220
38,263
 39,411
 29,476
 30,045
Total Secured and Unsecured debt$79,949
 $81,070
 $73,876
 $74,577
Total secured and unsecured debt$79,038
 $80,300
 $64,563
 $65,207
Fair value utilizing Level 2 inputs  $77,267
   $69,990
  $78,293
   $62,951
Fair value utilizing Level 3 inputs  $3,803
   $4,587
  $2,007
   $2,256


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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

The fair value of our debt measured utilizing Level 2 inputs was based on quoted market prices for identical instruments and if unavailable, quoted market prices of similar instruments. For debt that has termswith original maturity or revolving period of one yeareighteen months or less or has been priced within the last six months, the carrying amount or par value is considered to be a reasonable estimate of fair value. The fair value of our debt measured utilizing Level 3 inputs was based on the discounted future net cash flows expected to be settled using current risk-adjusted rates.

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Secured Debt Most of the secured debt was issued by VIEs and is repayable only from proceeds related to the underlying pledged assets. Refer to Note 8 - "Variable Interest Entities" for further discussion.
During the threenine months ended March 31,September 30, 2017, we entered into new credit facilities or renewed credit facilities with a total net additional borrowing capacity of $182 million,$1.7 billion, and we issued $18.8 billion in aggregate principal amount of securitization notes payable with an initial weighted average interest rate of $4.0 billion.2.09% and legal final maturity dates ranging from 2019 to 2025.
Unsecured Debt During the threenine months ended March 31,September 30, 2017, our top-tier holding companywe issued $2.5$10.6 billion in aggregate principal amount of senior notes comprising:with an initial weighted average interest rate of 2.87% and maturity dates ranging from 2019 to 2027.
 Amount Issued
3.45% Senior notes due January 2022$1,250
4.35% Senior notes due January 2027$750
Floating rate senior notes due January 2022$500
All of these notes are guaranteed solely by AmeriCredit Financial Services, Inc. (AFSI), our primary U.S. operating subsidiary.
Subsequent to March 31, 2017, our top-tier holding company issued $3.0 billionsubsidiary, and $407 million in senior notes comprised of $1.0 billion of 2.65% notes dueissued by subsidiaries in April 2020, $1.25 billion of 3.95% notes due in April 2024Canada and $750 million of floating rate notes due in April 2020. All of these notesMexico are also guaranteed solely by AFSI.
We accept deposits from retail banking customers in Germany. Following is summarized information for our deposits at March 31, 2017 and December 31, 2016:
 March 31, 2017 December 31, 2016
 Outstanding Balance Weighted Average Interest Rate Outstanding Balance Weighted Average Interest Rate
Overnight deposits$788
 0.40% $799
 0.50%
Term deposits - 12 months417
 0.84% 423
 0.93%
Term deposits - 24 months298
 1.24% 281
 1.26%
Term deposits - 36 months410
 1.47% 392
 1.48%
Total deposits$1,913
 0.86% $1,895
 0.91%
General Motors Financial Company, Inc.
Compliance with Debt Covenants Several of our revolving credit facilities require compliance with certain financial and operational covenants as well as regular reporting to lenders, including providing certain subsidiary financial statements. Certain of our secured debt agreements also contain various covenants, including maintaining portfolio performance ratios as well as limits on deferment levels. Our unsecured senior notes contain covenants including limitations on our ability to incur certain liens. At March 31,September 30, 2017, we were in compliance with theseour debt covenants.
Note 8. Variable Interest Entities
Securitizations and Credit Facilities
The following table summarizes the assets and liabilities related to our consolidated VIEs:
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Restricted cash(a)
$2,598
 $2,067
$2,291
 $1,780
Finance receivables, net of fees$30,370
 $29,661
$26,451
 $24,644
Lease related assets$23,154
 $19,341
$23,751
 $19,341
Secured debt$41,671
 $38,244
$40,188
 $34,185
_______________
(a) Included in other assets in the condensed consolidated balance sheets.
These amounts are related to securitization and credit facilities held by consolidated VIEs. Our continuing involvement with these VIEs consists of servicing assets held by the entities and holding residual interests in the entities. We have determined that we are the primary beneficiary of each VIE because we hold both (i) the power to direct the activities of the VIEs that most significantly impact the VIEs' economic performance and (ii) the obligation to absorb losses from and the right to receive benefits of the VIEs that could potentially be significant to the VIEs. We are not required, and do not currently intend, to provide any

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


additional financial support to these VIEs. Liabilities recognized as a result of consolidating these entities generally do not represent claims against us or our other subsidiaries and assets recognized generally are for the benefit of these entities operations and cannot be used to satisfy our or our subsidiariesother subsidiaries' obligations.
Other VIEsWe consolidate certain operating entities that provide auto finance and financial services, which we do not control through a majority voting interest. We manage these entities and maintain a controlling financial interest in them and are exposed to the risks of ownership through contractual arrangements. The majority voting interests in these entities are indirectly wholly-owned by our parent, GM. The amounts presented below are stated prior to intercompany eliminations and include amounts related to securitizations and credit facilities held by consolidated VIEs. The following table summarizes the assets and liabilities of these VIEs:
 March 31, 2017 December 31, 2016
Assets(a)
$4,312
 $4,251
Liabilities(b)
$3,604
 $3,559
_________________
(a)Comprised primarily of finance receivables, net of $3.6 billion and $3.5 billion at March 31, 2017 and December 31, 2016.
(b)Comprised primarily of debt of $3.0 billion and $3.0 billion at March 31, 2017 and December 31, 2016.
The following table summarizes the revenue and net income of these VIEs:
 Three Months Ended March 31,
 2017 2016
Total revenue$51
 $47
Net income$6
 $7

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Note 9. Derivative Financial Instruments and Hedging Activities
 March 31, 2017 December 31, 2016 September 30, 2017 December 31, 2016
Level Notional Fair Value Notional Fair ValueLevel Notional Fair Value Notional Fair Value
Derivatives designated as hedges                
Assets                
Fair value hedges                
Interest rate swaps2 $
 $
 $
 $
2 $3,500
 $20
 $
 $
Cash flow hedges                
Interest rate swaps2,3 3,597
 16
 3,542
 12
2,3 2,561
 12
 3,070
 12
Foreign currency swaps2 
 
 
 
2 1,356
 60
 
 
Total assets(a)
 $3,597
 $16
 $3,542
 $12
 $7,417
 $92
 $3,070
 $12
Liabilities                
Fair value hedges                
Interest rate swaps2 $8,950
 $317
 $7,700
 $276
2 $7,860
 $260
 $7,700
 $276
Cash flow hedges                
Interest rate swaps2,3 717
 1
 1,280
 3
2,3 
 
 500
 1
Foreign currency swaps2 802
 24
 791
 33
2 
 
 791
 33
Total liabilities(b)
 $10,469
 $342
 $9,771
 $312
 $7,860
 $260
 $8,991
 $310
Derivatives not designated as hedges                
Assets                
Interest rate swaps2,3 $15,455
 $74
 $8,667
 $55
2,3 $33,218
 $123
 $7,959
 $54
Interest rate caps and floors2 13,369
 33
 10,469
 26
2 16,810
 43
 9,698
 26
Foreign currency swaps2 617
 65
 1,576
 78
2 1,182
 85
 
 
Total assets(a)
 $29,441
 $172
 $20,712
 $159
 $51,210
 $251
 $17,657
 $80
Liabilities                
Interest rate swaps2,3 $14,225
 $55
 $8,337
 $36
2,3 $12,823
 $59
 $6,170
 $28
Interest rate caps and floors2 15,101
 33
 12,146
 26
2 18,467
 43
 12,146
 26
Foreign currency swaps2 1,412
 15
 119
 2
2 
 
 
 
Total liabilities(b)
 $30,738
 $103
 $20,602
 $64
 $31,290
 $102
 $18,316
 $54
 _________________
(a)Derivative assets are included in other assets in the condensed consolidated balance sheets.
(b)Derivative liabilities are included in other liabilities in the condensed consolidated balance sheets. Amounts accrued for interest payments in a net receivable position are included in other assets in the condensed consolidated balance sheets.

The fair value for Level 2 instruments was derived using the market approach based on observable market inputs including quoted prices of similar instruments and foreign exchange and interest rate forward curves. The fair value for Level 3 instruments was derived using the income approach based on a discounted cash flow model, in which expected cash flows are discounted using current risk-adjusted rates. The activity for interest rate swap agreements measured at fair value on a recurring basis using significant unobservable inputs (Level 3) was insignificant for the three and nine months ended March 31,September 30, 2017 and 2016.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


 Income (Losses) Recognized In Income
 Three Months Ended March 31,
 2017 2016
Fair value hedges   
Interest rate contracts(a)(b)
$11
 $(6)
Cash flow hedges   
Interest rate contracts(a)
(2) 
Foreign currency contracts(c)
6
 
Derivatives not designated as hedges   
Interest rate contracts(a)
(5) 
Foreign currency derivatives(c)(d)
(22) 69
Total$(12) $63
 Gains (Losses) Recognized In
Accumulated Other Comprehensive Loss
 Three Months Ended March 31,
 2017 2016
Cash flow hedges   
Interest rate contracts$2
 $
Foreign currency contracts(3) 
Total$(1) $
Gains (Losses) Reclassified From
Accumulated Other Comprehensive Loss Into Income
Income (Losses) Recognized In Income
Three Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
2017 20162017 2016 2017 2016
Fair value hedges       
Interest rate contracts(b)$9
 $6
 $38
 $26
Cash flow hedges          
Interest rate contracts(b)$1
 $
Foreign currency contracts(4) 
Interest rate contracts(a)
2
 (1) 1
 (2)
Foreign currency contracts(c)
44
 (1) 99
 (1)
Derivatives not designated as hedges       
Interest rate contracts(a)
16
 4
 7
 7
Foreign currency contracts(c)(d)
37
 
 72
 
Total$(3) $
$108
 $8
 $217
 $30
_________________
(a)Recognized in earnings as interest expense.
(b)Includes hedge ineffectiveness which reflects the net change in the fair value of interest rate contracts of $26 million and $2 million offset by the change in fair value of hedged debt attributable to the hedged risk of $27 million and $4 million for the three months ended March 31, 2017 and 2016.risk.
(c)Recognized in earnings as other operating expenses and interest expense.
(d)Activity is partially offset by translation activity (included in other operating expenses) related to foreign currency-denominated loans.
 
Gains (Losses) Recognized In
Accumulated Other Comprehensive Loss
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Cash flow hedges       
Interest rate contracts$
 $2
 $1
 $(2)
Foreign currency contracts24
 
 45
 
Total$24
 $2
 $46
 $(2)
 
Gains (Losses) Reclassified From
Accumulated Other Comprehensive Loss Into Income
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Cash flow hedges       
Interest rate contracts$(1) $1
 $
 $1
Foreign currency contracts(26) (4) (60) (4)
Total$(27) $(3) $(60) $(3)

Note 10. Commitments and Contingencies
Guarantees of Indebtedness The payments of principal and interest on senior notes issued by our top-tier holding company, our primary Canadian operating subsidiary and a European subsidiary are guaranteed by our primary U.S. operating subsidiary, AFSI. At March 31,September 30, 2017 and December 31, 2016, the par value of these senior notes was $31.5$37.3 billion and $29.0 billion. Refer to Note 1516 - "Guarantor Condensed Consolidating Financial Statements" for further discussion.
Legal Proceedings As a retail finance company, we are subject to various customer claims and litigation seeking damages and statutory penalties based upon, among other things, usury, disclosure inaccuracies, wrongful repossession, violations of bankruptcy stay provisions, certificate of title disputes, fraud, breach of contract, and discriminatory treatment of credit applicants. Some litigation against us could take the form of class action complaints by customers and certain legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. We establish reserves for legal claims when payments associated with the claims become probable and the payments can be reasonably estimated. Given the inherent difficulty of predicting the outcome of litigation and regulatory matters, it is generally very difficult to predict what the eventual

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


the eventual outcome will be, and when the matter will be resolved. The actual costs of resolving legal claims may be higher or lower than any amounts reserved for the claims. At March 31,September 30, 2017, we estimatedestimate our reasonably possible legal exposure for unfavorable outcomes ofis up to $112$73 million andexcluding $38 million related to the discontinued operations. We have accrued $37 million.$24 million excluding $10 million related to the discontinued operations.
In July 2014 and 2015, we were served with a subpoena by the U.S. Department of Justice directing us to produce certain documents relating to our and our subsidiaries’ and affiliates’ origination and securitization of sub-prime automobile loans since 2007 in connection with an investigation by the U.S. Department of Justice in contemplation of a civil proceeding for potential violations of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. Among other matters, the subpoena requests information relating to the underwriting criteria used to originate these automobile loans and the representations and warranties relating to those underwriting criteria that were made in connection with the securitization of the automobile loans. We have subsequently been served with additional investigative subpoenas to produce documents from various state attorneys general and other local governmental offices relating to our automobile loan and lease business and securitization of automobile loans and leases. These investigations are ongoing and could in the future result in the imposition of damages, fines or other civil or criminal claims and/or penalties. No assurance can be given that the ultimate outcome of the investigations or any resulting proceedings would not materially and adversely affect us or any of our subsidiaries and affiliates.
Other Administrative Tax Matters We accrue non-income tax liabilities for contingencies when management believes that a loss is probable and the amounts can be reasonably estimated, while contingent gains are recognized only when realized. In the event any losses are sustained in excess of accruals, they will be charged against income at that time.
In evaluating indirect tax matters, we take into consideration factors such as our historical experience with matters of similar nature, specific facts and circumstances, and the likelihood of prevailing. We reevaluate and update our accruals as matters progress over time. Where there is a reasonable possibility that losses exceeding amounts already recognized may be incurred, our estimate of the additional range of loss is up to $37$18 million excluding $18 million .related to the discontinued operations.
Note 11. Shareholders' Equity
On September 1, 2017, we executed a 10,000 to 1 stock split of each share of our previously authorized common stock, par value $1.00 per share. Each outstanding share was deemed automatically converted into 10,000 shares of common stock, par value $0.0001 per share.
In September 2017, we issued 1,000,000 shares, par value $0.01 per share, of Fixed-to-Floating Rate Cumulative Perpetual Preferred Stock, Series A, at a liquidation preference $1,000 per share, for net proceeds of $985 million.
For the first 10 years after issuance, holders of the preferred stock will be entitled to receive cash dividend payments at an annual rate of 5.750%, payable semi-annually in arrears on March 30 and September 30 of each year beginning on March 30, 2018. After 10 years, holders of the preferred stock will be entitled to receive cash dividend payments at a floating rate equal to the then applicable three-month U.S. dollar LIBOR plus a spread of 3.598% per annum, payable quarterly in arrears, on March 30, June 30, September 30 and December 30 of each year. Dividends on the preferred stock are cumulative whether or not we have earnings, whether or not there are funds legally available for the payment of the dividends and whether or not the dividends are authorized or declared.
The preferred stock does not have a maturity date. We may, at our option, redeem the shares of preferred stock, in whole or in part, at any time on or after September 30, 2027, at a price of $1,000 per share of preferred stock plus all accumulated and unpaid dividends.
Note 12. Income Taxes
For interim income tax reporting we estimate our annual effective tax rate and apply it to our year-to-date ordinary income. Tax jurisdictions with a projected or year-to-date loss for which a tax benefit cannot be realized are excluded from the annualized effective tax rate. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are reported in the interim period in which they occur.
During the three and nine months ended March 31,September 30, 2017, and 2016, income tax expense of $58$124 million and $61$260 million primarily resulted from tax expense attributable to entities included in our effective tax rate calculation. The decrease inDuring the three and nine months ended September 30, 2016, income tax expense is dueof $60 million and $185 million primarily resulted from tax expense attributable to an increaseentities included in U.S.our effective tax credits.rate calculation.
We are included in GM’s consolidated U.S. federal income tax return and for certain states’ income tax returns. Net operating losses and certain tax credits generated by us have been utilized by GM; however, income tax expense and deferred tax balances are presented in these financial statements as if we filed our own tax returns in each jurisdiction.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Note 12.13. Segment Reporting

We offer substantially similar products and services throughout many different regions, subject to local regulations and market conditions. We evaluate our business in two operating segments: the North America Segment and the International Segment. The North America Segment includes our operations in the U.S. and Canada. The International Segment includes our operations in all other countries.Brazil, Chile, Colombia, Mexico and Peru as well as our equity investment in SAIC-GMAC, a joint venture that conducts auto finance operations in China. Our chief operating decision maker evaluates the operating results and performance of our business based on these operating segments. The management of each segment is responsible for executing our strategies. As discussed in Note 2 - "Discontinued Operations," our European Operations are presented as discontinued operations and are excluded from our segment results for all periods presented. These operations were previously included in our International Segment. Key operating data for our operating segments were as follows:

 Three Months Ended September 30, 2017
 North
America
 International Total
Total revenue$2,868
 $293
 $3,161
Operating expenses265
 81
 346
Leased vehicle expenses1,662
 8
 1,670
Provision for loan losses177
 27
 204
Interest expense536
 136
 672
Equity income
 41
 41
Income from continuing operations before income taxes$228
 $82
 $310
 Three Months Ended September 30, 2016
 North
America
 International Total
Total revenue$2,092
 $268
 $2,360
Operating expenses240
 87
 327
Leased vehicle expenses1,194
 3
 1,197
Provision for loan losses147
 20
 167
Interest expense383
 128
 511
Equity income
 36
 36
Income from continuing operations before income taxes$128
 $66
 $194
 Nine Months Ended September 30, 2017
 North
America
 International Total
Total revenue$8,042
 $857
 $8,899
Operating expenses766
 243
 1,009
Leased vehicle expenses4,631
 17
 4,648
Provision for loan losses497
 76
 573
Interest expense1,488
 415
 1,903
Equity income
 129
 129
Income from continuing operations before income taxes$660
 $235
 $895

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


For segment reporting purposes only, interest expense related to the senior notes has been allocated based on targeted leverage for each segment. Interest expense in excess of the targeted overall leverage is reflected in the "Corporate" column below. In addition, the interest income on intercompany loans provided to the international operations is presented in the "Corporate" column as revenue. Key operating data for our operating segments were as follows:
Three Months Ended March 31, 2017Nine Months Ended September 30, 2016
North
America
 International Corporate Eliminations TotalNorth
America
 International Total
Total revenue$2,474
 $405
 $
 $
 $2,879
$5,666
 $763
 $6,429
Operating expenses248
 144
 
 
 392
656
 240
 896
Leased vehicle expenses1,426
 12
 
 
 1,438
3,143
 5
 3,148
Provision for loan losses187
 30
 
 
 217
449
 52
 501
Interest expense455
 164
 
 
 619
1,025
 368
 1,393
Equity income
 47
 
 
 47

 109
 109
Income before income taxes$158
 $102
 $
 $
 $260
Income from continuing operations before income taxes$393
 $207
 $600
 Three Months Ended March 31, 2016
 North
America
 International Corporate Eliminations Total
Total revenue$1,688
 $387
 $(1) $1
 $2,075
Operating expenses201
 133
 
 
 334
Leased vehicle expenses888
 5
 
 
 893
Provision for loan losses177
 19
 
 
 196
Interest expense305
 157
 
 1
 463
Equity income
 36
 
 
 36
Income (loss) before income taxes$117
 $109
 $(1) $
 $225
 September 30, 2017 December 31, 2016
 North
America
 International Total North
America
 International Total
Finance receivables, net$34,225
 $6,639
 $40,864
 $27,617
 $5,858
 $33,475
Leased vehicles, net$41,657
 $118
 $41,775
 $34,284
 $58
 $34,342
Total assets(a)
$84,971
 $21,164
 $106,135
 $68,656
 $19,109
 $87,765
________________
 March 31, 2017 December 31, 2016
 North
America
 International Total North
America
 International Total
Finance receivables, net$30,618
 $16,292
 $46,910
 $27,617
 $15,573
 $43,190
Leased vehicles, net$37,018
 $284
 $37,302
 $34,284
 $242
 $34,526
Total assets$74,793
 $19,747
 $94,540
 $68,656
 $19,109
 $87,765
(a) International Segment includes assets held for sale of $12.1 billion and $11.0 billion at September 30, 2017 and December 31, 2016.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


Note 13.14. Accumulated Other Comprehensive Loss
Three Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
2017 20162017 2016 2017 2016
Unrealized gain on cash flow hedge   
Unrealized gain (loss) on cash flow hedges       
Beginning balance$17
 $
$6
 $(4) $17
 $
Change in value of cash flow hedge, net of tax(4) 
Change in value of cash flow hedges, net of tax(3) (1) (14) (5)
Ending balance13
 
3
 (5) 3
 (5)
Defined benefit plans          
Beginning balance(20) (13)(21) (13) (20) (13)
Unrealized gain (loss) on subsidiary pension, net of tax
 (1)
 
 (1) 
Ending balance(20) (14)(21) (13) (21) (13)
Foreign currency translation adjustment          
Beginning balance(1,235) (1,091)(1,037) (1,021) (1,235) (1,091)
Translation gain, net of tax94
 153
Translation gain (loss), net of tax120
 (10) 318
 60
Ending balance(1,141) (938)(917) (1,031) (917) (1,031)
Total accumulated other comprehensive loss$(1,148) $(952)$(935) $(1,049) $(935) $(1,049)
Note 14.15. Regulatory Capital and other Regulatory Matters
We are required to comply with a wide variety of laws and regulations. Our International Segment includes the operationsCertain of certain stand-aloneour entities that operate in localinternational markets as either banks or regulated finance companies that are subject to regulatory restrictions. These regulatory restrictions, among other things, require that certain of these entities meet certain minimum capital requirements and may restrict dividend distributions and ownership of certain assets. We were in compliance with all regulatory capital requirements as most recently reported.
Total assets of our regulated international banks and finance companies were approximately $13.1$7.6 billion and $12.6$6.9 billion at March 31,September 30, 2017 and December 31, 2016.

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

Note 15.16. Guarantor Condensed Consolidating Financial Statements
The payment of principal and interest on senior notes issued by our top-tier holding company is currently guaranteed solely by AFSI (the Guarantor) and none of our other subsidiaries (the Non-Guarantor Subsidiaries). The Guarantor is a 100% owned consolidated subsidiary and is unconditionally liable for the obligations represented by the senior notes. The Guarantor’s guarantee may be released only upon customary circumstances, the terms of which vary by issuance. Customary circumstances include the sale or disposition of all of the Guarantor’s assets or capital stock, the achievement of investment grade rating of the senior notes and legal or covenant defeasance.
The condensed consolidating financial statements present consolidating financial data for (i) General Motors Financial Company, Inc. (on a parent-only basis), (ii) the Guarantor, (iii) the combined Non-Guarantor Subsidiaries and (iv) the parent company and our subsidiaries on a consolidated basis at March 31,September 30, 2017 and December 31, 2016, and for the three and nine months ended March 31,September 30, 2017 and 2016 (after the elimination of intercompany balances and transactions).
Investments in subsidiaries are accounted for by the parent company using the equity method for purposes of this presentation. Results of operations of subsidiaries are therefore reflected in the parent company's investment accounts and earnings. The principal elimination entries set forth below eliminate investments in subsidiaries and intercompany balances and transactions.




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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


CONDENSED CONSOLIDATING BALANCE SHEET
March 31, 2017
(Unaudited)
 
General
Motors
Financial
Company,
Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
ASSETS         
Cash and cash equivalents$
 $2,040
 $654
 $
 $2,694
Finance receivables, net
 7,516
 39,394
 
 46,910
Leased vehicles, net
 
 37,302
 
 37,302
Goodwill1,095
 
 105
 
 1,200
Equity in net assets of non-consolidated affiliates
 
 998
 
 998
Property and equipment, net
 163
 128
 
 291
Deferred income taxes613
 75
 284
 (688) 284
Related party receivables
 73
 544
 
 617
Other assets3
 746
 3,743
 (248) 4,244
Due from affiliates26,778
 15,992
 
 (42,770) 
Investment in affiliates9,401
 5,971
 
 (15,372) 
Total assets$37,890
 $32,576
 $83,152
 $(59,078) $94,540
LIABILITIES AND SHAREHOLDER'S EQUITY         
Liabilities         
Secured debt$
 $
 $42,827
 $(248) $42,579
Unsecured debt28,573
 
 8,797
 
 37,370
Accounts payable and accrued expenses261
 330
 910
 
 1,501
Deferred income
 
 2,588
 
 2,588
Deferred income taxes
 
 947
 (688) 259
Related party payables1
 
 447
 
 448
Other liabilities63
 476
 264
 
 803
Due to affiliates
 25,977
 16,793
 (42,770) 
Total liabilities28,898
 26,783
 73,573
 (43,706) 85,548
Shareholder's equity         
Common stock
 
 698
 (698) 
Additional paid-in capital6,512
 79
 4,652
 (4,731) 6,512
Accumulated other comprehensive loss(1,148) (157) (1,123) 1,280
 (1,148)
Retained earnings3,628
 5,871
 5,352
 (11,223) 3,628
Total shareholder's equity8,992
 5,793
 9,579
 (15,372) 8,992
Total liabilities and shareholder's equity$37,890
 $32,576
 $83,152
 $(59,078) $94,540













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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2016September 30, 2017
(Unaudited)
General
Motors
Financial
Company,
Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
ASSETS                  
Cash and cash equivalents$
 $2,284
 $917
 $
 $3,201
$
 $3,546
 $430
 $
 $3,976
Finance receivables, net
 4,969
 38,221
 
 43,190

 10,097
 30,767
 
 40,864
Leased vehicles, net
 
 34,526
 
 34,526

 
 41,775
 
 41,775
Goodwill1,095
 
 101
 
 1,196
1,095
 
 106
 
 1,201
Equity in net assets of non-consolidated affiliates
 
 944
 
 944
Property and equipment, net
 152
 127
 
 279
Deferred income taxes502
 89
 274
 (591) 274
Equity in net assets of non-consolidated affiliate
 
 1,119
 
 1,119
Related party receivables
 25
 485
 
 510

 38
 301
 
 339
Other assets4
 643
 3,167
 (169) 3,645
855
 1,230
 3,933
 (1,251) 4,767
Assets held for sale
 
 12,095
 (1) 12,094
Due from affiliates24,548
 16,065
 
 (40,613) 
32,762
 19,467
 
 (52,229) 
Investment in affiliates8,986
 6,445
 
 (15,431) 
10,177
 5,610
 
 (15,787) 
Total assets$35,135
 $30,672
 $78,762
 $(56,804) $87,765
$44,889
 $39,988
 $90,526
 $(69,268) $106,135
LIABILITIES AND SHAREHOLDER'S EQUITY         
LIABILITIES AND SHAREHOLDERS' EQUITY         
Liabilities                  
Secured debt$
 $
 $39,439
 $(169) $39,270
$
 $
 $41,177
 $(402) $40,775
Unsecured debt26,076
 
 8,530
 
 34,606
34,047
 
 4,216
 
 38,263
Accounts payable and accrued expenses302
 273
 899
 
 1,474
Deferred income
 
 2,365
 
 2,365

 
 3,066
 
 3,066
Deferred income taxes
 
 811
 (591) 220
Related party payables1
 
 399
 
 400
2
 
 251
 
 253
Other liabilities63
 417
 257
 
 737
369
 772
 2,157
 (849) 2,449
Liabilities held for sale
 
 10,864
 (6) 10,858
Due to affiliates
 24,437
 16,176
 (40,613) 

 32,576
 19,648
 (52,224) 
Total liabilities26,442
 25,127
 68,876
 (41,373) 79,072
34,418
 33,348
 81,379
 (53,481) 95,664
Shareholder's equity         
Shareholders' equity         
Common stock
 
 698
 (698) 

 
 698
 (698) 
Preferred stock
 
 
 
 
Additional paid-in capital6,505
 79
 5,345
 (5,424) 6,505
7,514
 79
 3,450
 (3,529) 7,514
Accumulated other comprehensive loss(1,238) (161) (1,223) 1,384
 (1,238)(935) (107) (874) 981
 (935)
Retained earnings3,426
 5,627
 5,066
 (10,693) 3,426
3,892
 6,668
 5,873
 (12,541) 3,892
Total shareholder's equity8,693
 5,545
 9,886
 (15,431) 8,693
Total liabilities and shareholder's equity$35,135
 $30,672
 $78,762
 $(56,804) $87,765
Total shareholders' equity10,471
 6,640
 9,147
 (15,787) 10,471
Total liabilities and shareholders' equity$44,889
 $39,988
 $90,526
 $(69,268) $106,135












18

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


CONDENSED CONSOLIDATING STATEMENT OF INCOMEBALANCE SHEET
Three Months Ended MarchDecember 31, 20172016
(Unaudited)
 General
Motors
Financial
Company,
Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $95
 $767
 $
 $862
Leased vehicle income
 
 1,942
 
 1,942
Other income
 273
 1
 (199) 75
Total revenue
 368
 2,710
 (199) 2,879
Costs and expenses         
Salaries and benefits
 163
 66
 
 229
Other operating expenses7
 44
 222
 (110) 163
Total operating expenses7
 207
 288
 (110) 392
Leased vehicle expenses
 
 1,438
 
 1,438
Provision for loan losses
 73
 144
 
 217
Interest expense235
 33
 440
 (89) 619
Total costs and expenses242
 313
 2,310
 (199) 2,666
Equity income315
 215
 47
 (530) 47
Income before income taxes73
 270
 447
 (530) 260
Income tax (benefit) provision(129) 26
 161
 
 58
Net income$202
 $244
 $286
 $(530) $202
          
Comprehensive income$292
 $248
 $386
 $(634) $292
 
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
ASSETS         
Cash and cash equivalents$
 $2,284
 $531
 $
 $2,815
Finance receivables, net
 4,969
 28,506
 
 33,475
Leased vehicles, net
 
 34,342
 
 34,342
Goodwill1,095
 
 101
 
 1,196
Equity in net assets of non-consolidated affiliate
 
 944
 
 944
Related party receivables
 25
 322
 
 347
Other assets506
 884
 3,065
 (760) 3,695
Assets held for sale
 
 10,959
 (8) 10,951
Due from affiliates24,548
 16,065
 
 (40,613) 
Investment in affiliates8,986
 6,445
 
 (15,431) 
Total assets$35,135
 $30,672
 $78,770
 $(56,812) $87,765
LIABILITIES AND SHAREHOLDER'S EQUITY         
Liabilities         
Secured debt$
 $
 $35,256
 $(169) $35,087
Unsecured debt26,076
 
 3,400
 
 29,476
Deferred income
 
 2,355
 
 2,355
Related party payables1
 
 319
 
 320
Other liabilities365
 690
 1,677
 (591) 2,141
Liabilities held for sale
 
 9,694
 (1) 9,693
Due to affiliates
 24,437
 16,183
 (40,620) 
Total liabilities26,442
 25,127
 68,884
 (41,381) 79,072
Shareholder's equity         
Common stock
 
 698
 (698) 
Additional paid-in capital6,505
 79
 5,345
 (5,424) 6,505
Accumulated other comprehensive loss(1,238) (161) (1,223) 1,384
 (1,238)
Retained earnings3,426
 5,627
 5,066
 (10,693) 3,426
Total shareholder's equity8,693
 5,545
 9,886
 (15,431) 8,693
Total liabilities and shareholder's equity$35,135
 $30,672
 $78,770
 $(56,812) $87,765







19

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


CONDENSED CONSOLIDATING STATEMENT OF INCOME
Three Months Ended March 31, 2016September 30, 2017
(Unaudited)
 General
Motors
Financial
Company,
Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $99
 $719
 $
 $818
Leased vehicle income
 
 1,184
 
 1,184
Other income(1) 205
 15
 (146) 73
Total revenue(1) 304
 1,918
 (146) 2,075
Costs and expenses         
Salaries and benefits
 135
 58
 
 193
Other operating expenses(4) 68
 170
 (93) 141
Total operating expenses(4) 203
 228
 (93) 334
Leased vehicle expenses
 
 893
 
 893
Provision for loan losses
 103
 93
 
 196
Interest expense176
 (30) 370
 (53) 463
Total costs and expenses172
 276
 1,584
 (146) 1,886
Equity income255
 168
 36
 (423) 36
Income before income taxes82
 196
 370
 (423) 225
Income tax (benefit) provision(82) 12
 131
 
 61
Net income$164
 $184
 $239
 $(423) $164
          
Comprehensive income$316
 $223
 $398
 $(621) $316



 General
Motors
Financial
Company, Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $146
 $691
 $
 $837
Leased vehicle income
 
 2,244
 
 2,244
Other income
 306
 
 (226) 80
Total revenue
 452
 2,935
 (226) 3,161
Costs and expenses         
Salaries and benefits
 182
 42
 
 224
Other operating expenses94
 (48) 203
 (127) 122
Total operating expenses94
 134
 245
 (127) 346
Leased vehicle expenses
 
 1,670
 
 1,670
Provision for loan losses
 196
 8
 
 204
Interest expense301
 1
 469
 (99) 672
Total costs and expenses395
 331
 2,392
 (226) 2,892
Equity income461
 306
 41
 (767) 41
Income from continuing operations before income taxes66
 427
 584
 (767) 310
Income tax (benefit) provision(136) 40
 220
 
 124
Income from continuing operations202
 387
 364
 (767) 186
Income (loss) from discontinued operations, net of tax
 (6) 22
 
 16
Net income202
 381
 386
 (767) 202
          
Net income attributable to common shareholder$200
 $381
 $386
 $(767) $200
          
Comprehensive income$319
 $411
 $525
 $(936) $319



20

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)


CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWSINCOME
Three Months Ended March 31, 2017September 30, 2016
(Unaudited)
 
General
Motors
Financial
Company,
Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
Net cash (used in) provided by operating activities$(273) $103
 $1,586
 $
 $1,416
Cash flows from investing activities         
Purchases of retail finance receivables, net
 (4,920) (3,850) 2,369
 (6,401)
Principal collections and recoveries on retail finance receivables
 450
 3,145
 
 3,595
Proceeds from transfer of retail finance receivables, net
 2,095
 274
 (2,369) 
Net funding of commercial finance receivables
 (194) (347) 
 (541)
Purchases of leased vehicles, net
 
 (4,794) 
 (4,794)
Proceeds from termination of leased vehicles
 
 1,082
 
 1,082
Purchases of property and equipment
 (19) (5) 
 (24)
Other investing activities
 (79) 

 79
 
Net change in due from affiliates(2,230) 80
 
 2,150
 
Net change in investment in affiliates
 694
 
 (694) 
Net cash used in investing activities(2,230) (1,893) (4,495) 1,535
 (7,083)
Cash flows from financing activities         
Net change in debt (original maturities less than three months)17
 
 (285) 
 (268)
Borrowings and issuance of secured debt
 
 8,440
 (79) 8,361
Payments on secured debt
 
 (4,805) 
 (4,805)
Borrowings and issuance of unsecured debt2,497
 
 471
 
 2,968
Payments on unsecured debt
 
 (574) 
 (574)
Debt issuance costs(11) 
 (16) 
 (27)
Net capital contributions
 
 (694) 694
 
Net change in due to affiliates
 1,546
 604
 (2,150) 
Net cash provided by financing activities2,503
 1,546
 3,141
 (1,535) 5,655
Net increase (decrease) in cash, cash equivalents and restricted cash
 (244) 232
 
 (12)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash
 
 37
 
 37
Cash, cash equivalents and restricted cash at beginning of period
 2,284
 3,018
 
 5,302
Cash, cash equivalents and restricted cash at end of period$
 $2,040
 $3,287
 $
 $5,327
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidating balance sheet:
 
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
Cash and cash equivalents$
 $2,040
 $654
 $
 $2,694
Restricted cash included in other assets
 
 2,633
 
 2,633
Total$
 $2,040
 $3,287
 $
 $5,327

 General
Motors
Financial
Company, Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $127
 $594
 $
 $721
Leased vehicle income
 
 1,582
 
 1,582
Other income
 213
 15
 (171) 57
Total revenue
 340
 2,191
 (171) 2,360
Costs and expenses         
Salaries and benefits
 157
 38
 
 195
Other operating expenses6
 54
 173
 (101) 132
Total operating expenses6
 211
 211
 (101) 327
Leased vehicle expenses
 
 1,197
 
 1,197
Provision for loan losses
 102
 65
 
 167
Interest expense171
 54
 356
 (70) 511
Total costs and expenses177
 367
 1,829
 (171) 2,202
Equity income267
 202
 36
 (469) 36
Income from continuing operations before income taxes90
 175
 398
 (469) 194
Income tax (benefit) provision(72) (17) 149
 
 60
Income from continuing operations162
 192
 249
 (469) 134
(Loss) income from discontinued operations, net of tax(15) 
 28
 
 13
Net income$147
 $192
 $277
 $(469) $147
          
Comprehensive income$136
 $183
 $270
 $(453) $136

21

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME
Nine Months Ended September 30, 2017
(Unaudited)
 General
Motors
Financial
Company, Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $375
 $2,026
 $
 $2,401
Leased vehicle income
 
 6,282
 
 6,282
Other income
 870
 (15) (639) 216
Total revenue
 1,245
 8,293
 (639) 8,899
Costs and expenses         
Salaries and benefits
 504
 117
 
 621
Other operating expenses200
 (43) 587
 (356) 388
Total operating expenses200
 461
 704
 (356) 1,009
Leased vehicle expenses
 
 4,648
 
 4,648
Provision for loan losses
 356
 217
 
 573
Interest expense883
 (28) 1,331
 (283) 1,903
Total costs and expenses1,083
 789
 6,900
 (639) 8,133
Equity income1,051
 797
 129
 (1,848) 129
(Loss) income from continuing operations before income taxes(32) 1,253
 1,522
 (1,848) 895
Income tax (benefit) provision(498) 199
 559
 
 260
Income from continuing operations466
 1,054
 963
 (1,848) 635
Income (loss) from discontinued operations, net of tax
 (13) (156) 
 (169)
Net income466
 1,041
 807
 (1,848) 466
          
Net income attributable to common shareholder$464
 $1,041
 $807
 $(1,848) $464
          
Comprehensive income$769
 $1,095
 $1,156
 $(2,251) $769

22

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME
Nine Months Ended September 30, 2016
(Unaudited)
 General
Motors
Financial
Company, Inc.
 Guarantor Non-
Guarantors
 Eliminations Consolidated
Revenue         
Finance charge income$
 $344
 $1,766
 $
 $2,110
Leased vehicle income
 
 4,144
 
 4,144
Other income(1) 628
 28
 (480) 175
Total revenue(1) 972
 5,938
 (480) 6,429
Costs and expenses         
Salaries and benefits
 432
 104
 
 536
Other operating expenses2
 175
 475
 (292) 360
Total operating expenses2
 607
 579
 (292) 896
Leased vehicle expenses
 
 3,148
 
 3,148
Provision for loan losses
 282
 219
 
 501
Interest expense612
 (67) 1,036
 (188) 1,393
Total costs and expenses614
 822
 4,982
 (480) 5,938
Equity income858
 538
 109
 (1,396) 109
Income from continuing operations before income taxes243
 688
 1,065
 (1,396) 600
Income tax (benefit) provision(272) 63
 394
 
 185
Income from continuing operations515
 625
 671
 (1,396) 415
(Loss) income from discontinued operations, net of tax(15) 
 100
 
 85
Net income$500
 $625
 $771
 $(1,396) $500
          
Comprehensive income$555
 $653
 $837
 $(1,490) $555

23

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
ThreeNine Months Ended March 31,September 30, 2017
(Unaudited)
 
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
Net cash (used in) provided by operating activities - continuing operations$(690) $616
 $4,869
 $
 $4,795
Net cash provided by (used in) operating activities - discontinued operations26
 (24) 241
 
 243
Net cash (used in) provided by operating activities(664) 592
 5,110
 
 5,038
Cash flows from investing activities         
Purchases of retail finance receivables, net
 (15,709) (11,312) 11,754
 (15,267)
Principal collections and recoveries on retail finance receivables
 1,875
 7,535
 
 9,410
Proceeds from transfer of retail finance receivables, net
 8,787
 2,967
 (11,754) 
Net funding of commercial finance receivables
 (429) (1,128) 
 (1,557)
Purchases of leased vehicles, net
 
 (14,809) 
 (14,809)
Proceeds from termination of leased vehicles
 
 4,649
 
 4,649
Other investing activities
 (288) (10) 233
 (65)
Net change in due from affiliates(8,213) (3,397) 
 11,610
 
Net change in investment in affiliates54
 1,686
 
 (1,740) 
Net cash used in investing activities - continuing operations(8,159) (7,475) (12,108) 10,103
 (17,639)
Net cash provided by (used in) investing activities - discontinued operations131
 
 (599) 
 (468)
Net cash used in investing activities(8,028) (7,475) (12,707) 10,103
 (18,107)
Cash flows from financing activities         
Net change in debt (original maturities less than three months)66
 
 (371) 
 (305)
Borrowings and issuance of secured debt
 
 26,964
 (233) 26,731
Payments on secured debt
 
 (20,905) 
 (20,905)
Borrowings and issuance of unsecured debt10,133
 
 2,493
 
 12,626
Payments on unsecured debt(2,450) 
 (1,925) 
 (4,375)
Debt issuance costs(42) 
 (89) 
 (131)
Proceeds from issuance of preferred stock985
 
 
 
 985
Net capital contributions
 
 (1,740) 1,740
 
Net change in due to affiliates
 8,145
 3,465
 (11,610) 
Net cash provided by financing activities - continuing operations8,692
 8,145
 7,892
 (10,103) 14,626
Net cash provided by financing activities - discontinued operations
 
 63
 
 63
Net cash provided by financing activities8,692
 8,145
 7,955
 (10,103) 14,689
Net increase in cash, cash equivalents and restricted cash
 1,262
 358
 
 1,620
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash
 
 112
 
 112
Cash, cash equivalents and restricted cash at beginning of period
 2,284
 3,018
 
 5,302
Cash, cash equivalents and restricted cash at end of period$
 $3,546
 $3,488
 $
 $7,034
Cash, cash equivalents and restricted cash from continuing operations at end of period$
 $3,546
 $2,923
 $
 $6,469
Cash, cash equivalents and restricted cash from discontinued operations at end of period$
 $
 $565
 $
 $565
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidating balance sheet:
 
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
Cash and cash equivalents$
 $3,546
 $430
 $
 $3,976
Restricted cash included in other assets
 
 2,493
 
 2,493
Total$
 $3,546
 $2,923
 $
 $6,469

24

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GENERAL MOTORS FINANCIAL COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Nine Months Ended September 30, 2016
(Unaudited) 
General
Motors
Financial
Company,
Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
General
Motors
Financial
Company, Inc.
 Guarantor 
Non-
Guarantors
 Eliminations Consolidated
Net cash (used in) provided by operating activities - continuing operations$(454) $(389) $4,409
 $
 $3,566
Net cash provided by operating activities - discontinued operations(15) 10
 295
 
 290
Net cash (used in) provided by operating activities$(144) $(537) $1,839
 $
 $1,158
(469) (379) 4,704
 
 3,856
Cash flows from investing activities                  
Purchases of retail finance receivables, net
 (4,466) (4,388) 4,689
 (4,165)
 (12,676) (10,047) 12,315
 (10,408)
Principal collections and recoveries on retail finance receivables
 359
 2,912
 
 3,271

 1,274
 6,094
 
 7,368
Proceeds from transfer of retail finance receivables, net
 2,866
 1,823
 (4,689) 

 8,232
 4,083
 (12,315) 
Net funding of commercial finance receivables
 (227) (797) 
 (1,024)
 (335) (810) 
 (1,145)
Purchases of leased vehicles, net
 
 (5,158) 
 (5,158)
 
 (14,939) 
 (14,939)
Proceeds from termination of leased vehicles
 
 481
 
 481

 
 1,799
 
 1,799
Purchases of property and equipment
 (15) (5) 
 (20)
Other investing activities
 (60) 1
 60
 1

 (219) (9) 169
 (59)
Net change in due from affiliates(2,587) (1,208) 
 3,795
 
(7,506) (6,621) 
 14,127
 
Net change in investment in affiliates
 336
 
 (336) 
24
 2,473
 
 (2,497) 
Net cash used in investing activities - continuing operations(7,482) (7,872) (13,829) 11,799
 (17,384)
Net cash used in investing activities - discontinued operations
 
 (949) 
 (949)
Net cash used in investing activities(2,587) (2,415) (5,131) 3,519
 (6,614)(7,482) (7,872) (14,778) 11,799
 (18,333)
Cash flows from financing activities                  
Net change in debt (original maturities less than three months)
 
 757
 
 757
1
 
 (302) 
 (301)
Borrowings and issuance of secured debt
 
 7,114
 (60) 7,054

 
 18,589
 (169) 18,420
Payments on secured debt
 
 (5,251) 
 (5,251)
 
 (12,525) 
 (12,525)
Borrowings and issuance of unsecured debt2,744
 
 387
 
 3,131
8,987
 
 1,371
 
 10,358
Payments on unsecured debt
 
 (241) 
 (241)(1,000) 
 (1,345) 
 (2,345)
Debt issuance costs(13) 
 (13) 
 (26)(37) 
 (75) 
 (112)
Net capital contributions
 
 (336) 336
 

 
 (2,497) 2,497
 
Net change in due to affiliates
 2,732
 1,063
 (3,795) 

 7,643
 6,484
 (14,127) 
Net cash provided by financing activities - continuing operations7,951
 7,643
 9,700
 (11,799) 13,495
Net cash provided by financing activities - discontinued operations
 
 601
 
 601
Net cash provided by financing activities2,731
 2,732
 3,480
 (3,519) 5,424
7,951
 7,643
 10,301
 (11,799) 14,096
Net increase (decrease) in cash, cash equivalents, and restricted cash
 (220) 188
 
 (32)
Net increase (decrease) in cash, cash equivalents and restricted cash
 (608) 227
 
 (381)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash
 
 58
 
 58

 
 22
 
 22
Cash, cash equivalents and restricted cash at beginning of period
 2,319
 2,683
 
 5,002

 2,319
 2,683
 
 5,002
Cash, cash equivalents and restricted cash at end of period$
 $2,099
 $2,929
 $
 $5,028
$
 $1,711
 $2,932
 $
 $4,643
Cash, cash equivalents and restricted cash from continuing operations at end of period$
 $1,711
 $2,207
 $
 $3,918
Cash, cash equivalents and restricted cash from discontinued operations at end of period$
 $
 $725
 $
 $725




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Table of Contents
GENERAL MOTORS FINANCIAL COMPANY, INC.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Basis of Presentation This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with the accompanying condensed consolidated financial statements and the audited consolidated financial statements and notes thereto included in our 2016 Form 10-K.

Our European Operations are presented as discontinued operations, and the assets and liabilities of our European Operations are presented as held for sale in our condensed consolidated financial statements for all periods presented. Unless otherwise indicated, information in this discussion and analysis relates to continuing operations. Refer to Note 2 - "Discontinued Operations" to our condensed consolidated financial statements for additional details regarding our planned disposal of these operations.
Forward-looking statements in this MD&A are not guarantees of future performance and may involve risks and uncertainties that could cause actual results to differ materially from those projected. Refer to the "Forward-Looking Statements" section of this MD&A and the "Risk Factors" section of our 2016 Form 10-K for a discussion of these risks and uncertainties. Except as otherwise specified, dollar amounts presented within tables are stated in millions.
Retail Our retail automobile finance programs in the North America SegmentU.S. include full-spectrum lending and leasing offered through GM-franchised dealers under the "GM Financial" brand. We also offer a sub-prime lending product through non-GM-franchised and select independent dealers under the "AmeriCredit" brand. Our sub-prime lending program is designed to serve customers who have limited access to automobile financing through banks and credit unions. We therefore generally charge higher rates than those charged by banks and credit unions and expect to sustain a higher level of credit losses than on prime lending. We finance new GM vehicles, moderately-priced new vehicles from other manufacturers, and later-model, low mileage used vehicles.
TheOur international retail lending and leasing programs in our International Segment focus on financing new GM vehicles and select used vehicles, predominantly for customers with prime credit scores.vehicles. We also offer finance and/or car-related insurance products through third parties, such as payment protection, insurance, gap, extended warranty and motor insurance.
We have expanded our leasing and prime lending programs through GM-franchised dealerships in the U.S.; therefore, leasing and prime lending have become a larger percentage of our originations and retail portfolio balance. We have been the exclusive subvented lease provider for GM in the U.S. since April 2015 and the exclusive subvented loan provider for GM in the U.S. since January 2016. We define prime lending as lending to customers with FICO scores or equivalents of 680 and greater, near-prime lending as lending to customers with FICO scores or equivalents of 620 to 679, and sub-prime lending as lending to customers with FICO scores or equivalents of less than 620. The following table presents our retail loan and lease originations in the North America Segment by FICO score band or equivalents:
 Three Months Ended March 31,
 2017 2016
 Amount Percentage Amount Percentage
Prime$8,253
 74.5% $6,347
 68.3%
Near-prime1,245
 11.2
 1,241
 13.3
Sub-prime1,579
 14.3
 1,712
 18.4
Total originations$11,077
 100.0% $9,300
 100.0%
The following table summarizes the residual value as well as the number of units included in leased vehicles, net by vehicle type (units in thousands):
 March 31, 2017 December 31, 2016
 Residual Value Units Percentage Residual Value Units Percentage
Cars$5,738
 455
 31.4% $5,341
 430
 32.2%
Trucks5,669
 239
 16.5
 5,236
 224
 16.8
CUVs11,437
 675
 46.5
 10,366
 606
 45.4
SUVs3,060
 82
 5.6
 2,791
 75
 5.6
Total$25,904
 1,451
 100.0% $23,734
 1,335
 100.0%
We expect used car prices to decline approximately 7% during 2017 as compared to 2016 and expect potential further moderation in 2018 due primarily to an increased supply of used vehicles. We are currently experiencing weaker residual values, especially in the crossover segment. We continue to expect pre-tax income to double from 2014 earnings of $815 million once full captive penetration levels are achieved.


23

Table of Contents
GENERAL MOTORS FINANCIAL COMPANY, INC.

 Nine Months Ended September 30,
 2017 2016
 Amount Percentage Amount Percentage
Prime - FICO Score 680 and greater$24,082
 74.2% $19,330
 69.6%
Near-prime - FICO Score 620 to 6793,783
 11.7
 3,606
 13.0
Sub-prime - FICO Score less than 6204,577
 14.1
 4,829
 17.4
Total originations$32,442
 100.0% $27,765
 100.0%
The following table summarizes additional information for operating leases (in thousands):
Three Months Ended March 31,Three Months Ended September 30, Nine Months Ended September 30,
2017 20162017 2016 2017 2016
Operating leases originated(a)
174
 187
174
 161
 530
 518
Operating leases terminated(b)
59
 26
98
 36
 242
 94
Operating lease vehicles returned(c)
38
 13
68
 17
 163
 44
Return rate(d)
64% 48%69% 47% 67% 47%
________________ 
(a)Operating leases originated represents the number of operating leases we purchase during a given period.
(b)Operating leases terminated represents the number of vehicles for which the lease has ended during a given period.
(c)Operating lease vehicles returned represents the number of vehicles returned to us for remarketing at the end of the lease term.
(d)Return rates are calculated as the number of operating leases returned divided by the number of operating leases terminated.

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Table of Contents
GENERAL MOTORS FINANCIAL COMPANY, INC.

Operating leases terminated and operating lease vehicles returned increased due to the growth and maturity of the leaseleased asset portfolio. Due to the current age and size of our lease portfolio, the current return rate is lower than we expect it to be in future periods as our lease portfolio grows and matures.
The following table summarizes the residual value and the number of units included in leased vehicles, net by vehicle type (units in thousands):
 September 30, 2017 December 31, 2016
 Residual Value Units 
Unit
Percentage
 Residual Value Units Unit
Percentage
Cars$5,968
 460
 28.6% $5,240
 420
 31.7%
Trucks6,722
 276
 17.1
 5,231
 224
 16.9
CUVs13,107
 782
 48.5
 10,349
 604
 45.7
SUVs3,456
 93
 5.8
 2,791
 75
 5.7
Total$29,253
 1,611
 100.0% $23,611
 1,323
 100.0%
Based on recent pricing trends for used vehicles in the secondary market, which have remained more favorable than previously expected, as well as the temporary impact from Hurricanes Harvey and Irma, we now expect used car prices to decline less than 7% during 2017 compared to 2016. We continue to expect an increased supply of used vehicles to pressure used car prices in 2018.
Commercial Our commercial lending programs are offered primarily to our GM-franchised dealer customers and their affiliates. Commercial lending products primarily include floorplan financing, also known as wholesale working capital financing, loans to purchase and/or inventory financing, which is lending to finance vehicle inventory, as well as dealer loans, which aredealership real estate and loans to finance improvements to dealership facilities, to provide working capital, and to purchase and/or finance dealership real estate.facilities. Other commercial products include financing for parts and accessories, dealer fleets and storage centers.
Financing We primarily finance our loan, lease and commercial origination volume through the use of our secured and unsecured credit facilities, through public and private securitization transactions where such markets are developed and through the issuance of unsecured debt in the public markets and by accepting deposits from retail banking customers in Germany.markets. Generally, we seek to fund our operations through local sources of funding to minimize currency and country risk, although we may issue debt globally in order to enhance funding source diversification and support financing needs for the U.S. As such, the mix of funding sources varies from country to country, based on the characteristics of our earning assets and the relative development of the capital markets in each country. Our operations in the U.S., Canada, Latin America and China are generally funded locally. Our European operations obtain most of their funding from local sources and also borrow funds from affiliated companies. We actively monitor the capital markets and seek to optimize our mix of funding sources and our cost of funds.
PSAPeugeot S.A. Transaction On March 5, 2017, GM throughGeneral Motors Holdings LLC, a wholly-owned subsidiary (the Seller),of GM and our parent, entered into a Master Agreement (the Agreement) with Peugeot S.A. (PSA Group) pursuantPursuant to which PSA Group will acquire GM'sthe Agreement, Peugeot S.A. acquired on July 31, 2017 GM’s Opel and Vauxhall businesses and certain other assets in Europe (the Opel/Vauxhall Business) and will acquire, together with a financial partner, certain of our European financial subsidiaries and branches (European(collectively, our European Operations and, together with the Opel/Vauxhall Business, the TransferredGM's European Business), as described in Note 2 - "Disposition of Business""Discontinued Operations" to our condensed consolidated financial statements.
The net consideration to be paid for our European Operations will be 0.8 times their book value at closing, whichclosing. Based on exchange rates at September 30, 2017, we estimate the net consideration will be approximately $1$1.1 billion, denominated in Euros.and we currently expect to recognize a disposal loss of approximately $500 million, subject to foreign currency fluctuations, which have had a favorable impact on the estimated loss. The purchase price is subject to certain adjustments as provided in the Agreement. During the nine months ended September 30, 2017, we recognized a portion of the disposal loss, in accordance with ASC 360 - "Property, Plant and Equipment." We expect to recognize athe remainder of the disposal loss of approximately $700 million to $800 million at closing.
The transferthe closing of the Transferred Business is subject totransaction.
At and during the satisfactionnine months ended September 30, 2017, the assets and liabilities of our European Operations have been presented as held for sale and its operations and cash flows have been presented as discontinued operations based on the progress towards satisfying the various closing conditions including receipt of necessary antitrust, financial and other regulatory approvals,to complete the reorganization of the Transferred Business, including pension plans in the United Kingdom, the completion of the contribution or sale by Adam Opel AG of its assets and liabilities to a subsidiary, the transfer of GMAC UK plc’s interest in SAIC-GMAC Automotive Finance Company Limited to us or an alternate entity designated by the Seller, unless either party elects to close without completion of the transfer, and the continued accuracy, subject to certain exceptions, at closing of certain of the Seller’s representations and warranties. There can be no assurance that all required governmental consents or clearances will be obtained or that the other closing conditions will be satisfied.transaction. The transfer of the Opel/Vauxhall Business is expected to close by the end of 2017 and the transfer of our European Operations is expected to close as soon as practicable afterby the end of the year subject to the receipt of the remaining necessary antitrust, financial and other regulatory approvals which may be afterand satisfaction of other closing conditions. Refer to Note 2 - "Discontinued Operations" to our condensed consolidated financial statements for more information related to the transfer of the Opel/Vauxhall Business, but not before. The transferassets and liabilities held for sale and discontinued operations of our European Operations will not occur unless the transfer of the Opel/Vauxhall Business occurs.

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Operations.
Our principal focus is on expanding our business in the U.S. to reach full captive penetration levels; therefore, we do not expect that the sale of our European Operations will have a material adverse effect on our consolidated results of operations, financial condition, liquidity or financing strategies, including the mix of secured and unsecured debt issuances. We also do not expect that the sale of our European Operations will result in a material increase in our ratio of total debt to total equity or our earning assets leverage ratio as calculated under our Support Agreement with GM. Due to the size of the prime retail loan portfolio held by our European Operations, we expect that, for a period of time following the sale, retail operating leasesleased vehicles will make up a greater

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percentage of our earning assets than they have historically. As our U.S. operations increase purchases of prime retail loans, we expect that our earning asset mix will return to more recent historical levels. We may makewill distribute 50% of the sales proceeds to GM as a special dividend over time to GMshortly following the completion of the sale.
We continue to expect pre-tax income to double from 2014 earnings of $815 million once full captive penetration levels are achieved on a consistent basis.
Results of Operations
In our tabular presentation of the changes in results between financial periods, we provide the following information:  (i) the amount of change excluding the impact of foreign currency translation (“FX”)(FX); (ii) the amount of the impact of foreign currency translation; and (iii) the total change. The amount of the impact of foreign currency translation is derived by translating current year results at the average of prior year exchange rates, and is driven by the change in the U.S. Dollar against the currencies used by our foreign operations. We believe the amount of change excluding the foreign currency translation impact facilitates a better comparison of results. In our discussion below, we discuss changes in relevant items excluding any foreign currency translation impact. Average balances are calculated using daily balances, where available. Otherwise average balances are calculated using monthly ending balances.
Three Months Ended March 31,September 30, 2017 compared to Three Months Ended March 31,September 30, 2016
Average Earning Assets
Three Months Ended March 31,        
2017 2016 2017 vs. 2016
Average Earning AssetsThree Months Ended September 30, 2017 vs. 2016
North America International Total North America International Total Change excluding FX FX Total change %2017 2016 Change excluding FX FX Total change %
Average retail finance receivables$22,698
 $11,395
 $34,093
 $18,622
 $10,963
 $29,585
 $4,837
 $(329) $4,508
 15.2 %$31,796
 $24,740
 $6,905
 $151
 $7,056
 28.5%
Average commercial finance receivables6,635
 4,533
 11,168
 4,109
 4,510
 8,619
 2,761
 (212) 2,549
 29.6 %9,617
 6,161
 3,397
 59
 3,456
 56.1%
Average finance receivables29,333
 15,928
 45,261
 22,731
 15,473
 38,204
 7,598
 (541) 7,057
 18.5 %41,413
 30,901
 10,302
 210
 10,512
 34.0%
Average leased vehicles, net35,687
 262
 35,949
 22,190
 97
 22,287
 13,627
 35
 13,662
 61.3 %40,789
 29,971
 10,736
 82
 10,818
 36.1%
Average earning assets$65,020
 $16,190
 $81,210
 $44,921
 $15,570
 $60,491
 $21,225
 $(506) $20,719
 34.3 %$82,202
 $60,872
 $21,038
 $292
 $21,330
 35.0%
                              
Retail finance receivables purchased$4,817
 $1,697
 $6,514
 $2,580
 $1,563
 $4,143
 $2,441
 $(70) $2,371
 57.2 %$4,686
 $4,159
 $495
 $32
 $527
 12.7%
Average new retail loan size (in dollars)$27,095
 $11,425
   $27,470
 $11,425
          
Leased vehicles purchased$6,260
 $53
 $6,313
 $6,720
 $32
 $6,752
 $(443) $4
 $(439) (6.5)%$6,557
 $6,129
 $411
 $17
 $428
 7.0%
Average new lease size (in dollars)$36,514
 $21,124
   $36,270
 $20,020
          
Average finance receivables increased in the North America Segment as a result of the continued increase of our share of GM's business in that segment.the U.S. The increase in average leased vehicles, net primarily resulted from our exclusive lease subvention arrangement in the U.S. with GM.
In the North America Segment, the average annual percentage rate for retail finance receivables purchased during the three months ended March 31, 2017 decreased to 6.5% from 7.7% during the prior period due primarily to the expansion of our prime lending program and our exclusive loan subvention arrangement in the U.S. with GM.

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Revenue
Three Months Ended March 31,        
2017 2016 2017 vs. 2016
RevenueThree Months Ended September 30, 2017 vs. 2016
North America International Total North America International Total Change excluding FX FX Total change %2017 2016 Change excluding FX FX Total change %
Finance charge income                              
Retail finance receivables$466
 $269
 $735
 $453
 $260
 $713
 $10
 $12
 $22
 3.1%$724
 $655
 $61
 $8
 $69
 10.5%
Commercial finance receivables$55
 $72
 $127
 $32
 $73
 $105
 $23
 $(1) $22
 21.0%$113
 $66
 $46
 $1
 $47
 71.2%
Leased vehicle income$1,926
 $16
 $1,942
 $1,178
 $6
 $1,184
 $754
 $4
 $758
 64.0%$2,244
 $1,582
 $655
 $7
 $662
 41.8%
Other income$27
 $48
 $75
 $25
 $48
 $73
 $
 $2
 $2
 2.7%$80
 $57
 $21
 $2
 $23
 40.4%
Equity income$41
 $36
 $5
 $
 $5
 13.9%
Effective yield - retail finance receivables8.3% 9.6% 8.7% 9.8% 9.5% 9.7%        9.0% 10.5%        
Effective yield - commercial finance receivables3.4% 6.4% 4.6% 3.1% 6.5% 4.9%        4.7% 4.3%        
In the North America Segment, financeFinance charge income on retail finance receivables increased slightly for the three months ended March 31, 2017, compared to the three months ended March 31, 2016, due to growth in the portfolio, substantially offset by a decrease in effective yield. The effective yield on our retail finance receivables decreased due primarily to a decrease in the average annual percentage rate on new originations in the U.S. to 5.2% for the three months ended September 30, 2017 from 6.2% for the three months ended September 30, 2016, as we have increased our lending to borrowers with prime lending.credit. The effective yield represents finance charges and fees recorded in earnings during the period as a percentage of average retail finance receivables. The effective yield, as a percentage of average retail finance receivables, is higher than the contractual rates of our auto finance contracts primarily because the effective yield includes, in addition to the contractual rates and fees, the impact of rate subvention provided by GM.

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Finance charge income on commercial finance receivables increased due to growth in the portfolio, and due to an increase in the effective yield resulting from rising benchmark interest rates.
The increase in leased vehicle income reflects the increase in the sizegrowth of the leased asset portfolio.
Costs and ExpensesEquity income in our China joint venture increased due primarily to growth in asset levels driven by increased retail penetration.
 Three Months Ended March 31,        
 2017 2016 2017 vs. 2016
 North America International Total North America International Total Change excluding FX FX Total change %
Operating expenses$248
 $144
 $392
 $201
 $133
 $334
 $58
 $
 $58
 17.4%
Leased vehicle expenses$1,426
 $12
 $1,438
 $888
 $5
 $893
 $542
 $3
 $545
 61.0%
Provision for loan losses$187
 $30
 $217
 $177
 $19
 $196
 $21
 $
 $21
 10.7%
Interest expense(a)
$455
 $164
 $619
 $305
 $158
 $463
 $145
 $11
 $156
 33.7%
Average debt outstanding$62,167
 $14,170
 $76,337
 $43,101
 $13,654
 $56,755
 $19,923
 $(341) $19,582
 34.5%
Effective rate of interest on debt3.0% 4.7% 3.3% 2.8% 4.7% 3.3%        
(a)
During 2016, amounts do not reflect allocation of senior note interest expense, and therefore do not agree with amounts presented in Note 12 - "Segment Reporting" in our condensed consolidated financial statements in this Form 10-Q.

Costs and ExpensesThree Months Ended September 30, 2017 vs. 2016
 2017 2016 Change excluding FX FX Total change %
Operating expenses$346
 $327
 $18
 $1
 $19
 5.8%
Leased vehicle expenses$1,670
 $1,197
 $469
 $4
 $473
 39.5%
Provision for loan losses$204
 $167
 $36
 $1
 $37
 22.2%
Interest expense$672
 $511
 $157
 $4
 $161
 31.5%
Average debt outstanding$78,953
 $56,902
 $21,823
 $228
 $22,051
 38.8%
Effective rate of interest on debt3.4% 3.6%        
Operating Expenses The increase in operating expenses relates to the growth in earning assets and investments to support the prime lending program and enhance lease origination and servicing capabilities in the North America Segment.U.S. Operating expenses as an annualized percentage of average earning assets decreased to 2.0%1.7% from 2.2%2.1% for the three months ended March 31,September 30, 2017, andcompared to the three months ended September 30, 2016, due primarily to efficiency gains achieved through higher earning asset levels.
Leased Vehicle Expenses Leased vehicle expenses, which are primarily comprised of depreciation of leased vehicles, increased due to the growth of the leased asset portfolio.
Provision for Loan Losses The provision for retail loan losses increased due primarily to the growth inof the retail finance receivables portfolio. As an annualized percentage of average retail finance receivables, the provision for retail loan losses decreased to 2.5% for the three months ended March 31,September 30, 2017 from 2.7%2.6% for the three months ended March 31,September 30, 2016, due primarily to a

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shift in the credit mix of the portfolio to a larger percentage of prime loans. The provision for commercial loan losses was insignificant for the three months ended March 31,September 30, 2017 and 2016.
Interest Expense Interest expense increased due primarily to an increase in the average debt outstanding resulting from growth in the loan and lease portfolios.
Taxes Our consolidated effective income tax rate was 27.2%46.1% and 32.3%38.0% of income before income taxes and equity income for the three months ended March 31,September 30, 2017 and 2016. The increase in the effective income tax rate is due primarily to differences in U.S. taxation of foreign earnings and a decrease in certain U.S. federal tax credits.
Other Comprehensive Income
Foreign Currency Translation Adjustment Foreign currency translation adjustments included in other comprehensive income (loss) were $120 million and $(10) million for the three months ended September 30, 2017 and 2016. Translation adjustments result from changes in the values of our international currency-denominated assets and liabilities as the value of the U.S. Dollar changes in relation to international currencies.

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Nine Months Ended September 30, 2017 compared to Nine Months Ended September 30, 2016
Average Earning AssetsNine Months Ended September 30, 2017 vs. 2016
 2017 2016 Change excluding FX FX Total change %
Average retail finance receivables$29,918
 $23,728
 $6,030
 $160
 $6,190
 26.1%
Average commercial finance receivables8,844
 5,731
 3,091
 22
 3,113
 54.3%
Average finance receivables38,762
 29,459
 9,121
 182
 9,303
 31.6%
Average leased vehicles, net38,282
 26,128
 12,131
 23
 12,154
 46.5%
Average earning assets$77,044
 $55,587
 $21,252
 $205
 $21,457
 38.6%
            
Retail finance receivables purchased$15,546
 $10,580
 $4,872
 $94
 $4,966
 46.9%
Leased vehicles purchased$19,581
 $19,327
 $242
 $12
 $254
 1.3%
Average finance receivables increased as a result of the continued increase of our share of GM's business. The increase in average leased vehicles, net primarily resulted from our exclusive lease subvention arrangement in the U.S. with GM.
RevenueNine Months Ended September 30, 2017 vs. 2016
 2017 2016 Change excluding FX FX Total change %
Finance charge income           
Retail finance receivables$2,098
 $1,924
 $140
 $34
 $174
 9.0%
Commercial finance receivables$303
 $186
 $113
 $4
 $117
 62.9%
Leased vehicle income$6,282
 $4,144
 $2,133
 $5
 $2,138
 51.6%
Other income$216
 $175
 $35
 $6
 $41
 23.4%
Equity income$129
 $109
 $24
 $(4) $20
 18.3%
Effective yield - retail finance receivables9.4% 10.8%        
Effective yield - commercial finance receivables4.6% 4.3%        
Finance charge income on retail finance receivables increased due to growth in the portfolio, substantially offset by a decrease in effective yield. The effective yield on our retail finance receivables decreased due primarily to a decrease in the average annual percentage rate on new originations in the U.S. to 5.9% for the nine months ended September 30, 2017 from 7.0% for the nine months ended September 30, 2016, as we have increased our lending to borrowers with prime credit. The effective yield represents finance charges and fees recorded in earnings during the period as a percentage of average retail finance receivables. The effective yield, as a percentage of average retail finance receivables, is higher than the contractual rates of our auto finance contracts primarily because the effective yield includes, in addition to the contractual rates and fees, the impact of rate subvention provided by GM.
Finance charge income on commercial finance receivables increased due to growth in the portfolio, and due to an increase in the effective yield resulting from rising benchmark interest rates.
The increase in leased vehicle income reflects the growth of the leased asset portfolio.
Equity income in our China joint venture increased due primarily to growth in asset levels driven by increased retail penetration.

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Costs and ExpensesNine Months Ended September 30, 2017 vs. 2016
 2017 2016 Change excluding FX FX Total change %
Operating expenses$1,009
 $896
 $103
 $10
 $113
 12.6%
Leased vehicle expenses$4,648
 $3,148
 $1,497
 $3
 $1,500
 47.6%
Provision for loan losses$573
 $501
 $70
 $2
 $72
 14.4%
Interest expense$1,903
 $1,393
 $489
 $21
 $510
 36.6%
Average debt outstanding$73,278
 $52,378
 $20,720
 $180
 $20,900
 39.9%
Effective rate of interest on debt3.5% 3.6%        
Operating Expenses The increase in operating expenses relates to the growth in earning assets and investments to support the prime lending program and enhance lease origination and servicing capabilities in the U.S. Operating expenses as an annualized percentage of average earning assets decreased to 1.8% from 2.2% for the nine months ended September 30, 2017, compared to the nine months ended September 30, 2016, due primarily to efficiency gains achieved through higher earning asset levels.
Leased Vehicle Expenses Leased vehicle expenses, which are primarily comprised of depreciation of leased vehicles, increased due to the growth of the leased asset portfolio.
Provision for Loan Losses The provision for retail loan losses increased due primarily to the growth of the retail finance receivables portfolio. As an annualized percentage of average retail finance receivables, the provision for retail loan losses decreased to 2.5% for the nine months ended September 30, 2017 from 2.8% for the nine months ended September 30, 2016, due primarily to a shift in the credit mix of the portfolio to a larger percentage of prime loans. The provision for commercial loan losses was insignificant for the nine months ended September 30, 2017 and 2016.
Interest Expense Interest expense increased due primarily to an increase in the average debt outstanding resulting from growth in the loan and lease portfolios.
Taxes Our consolidated effective income tax rate was 33.9% and 37.7% of income before income taxes and equity income for the nine months ended September 30, 2017 and 2016. The decrease in the effective income tax rate is due primarily to reduced tax expense attributable to entities included in our effective tax rate calculation and an increase in certain U.S. federal tax credits.
Other Comprehensive Income
Foreign Currency Translation Adjustment Foreign currency translation adjustments included in other comprehensive income were $94$318 million and $153$60 million for the threenine months ended March 31,September 30, 2017 and 2016. Most of the international operations use functional currencies other than the U.S. Dollar. Translation adjustments result from changes in the values of our international currency-denominated assets and liabilities as the value of the U.S. Dollar changes in relation to international currencies.
Credit Quality
Retail Finance ReceivablesMarch 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
North America International Total North America International Total
Retail finance receivables, net of fees$24,354
 $11,650
 $36,004
 $21,786
 $11,124
 $32,910
$32,317
 $26,400
Less: allowance for loan losses(718) (134) (852) (666) (127) (793)(899) (765)
Retail finance receivables, net$23,636
 $11,516
 $35,152
 $21,120
 $10,997
 $32,117
$31,418
 $25,635
Number of outstanding contracts1,199,487
 1,622,179
 2,821,666
 1,097,207
 1,611,276
 2,708,483
2,262,017
 2,011,818
Average amount of outstanding contracts (in dollars)(a)
$20,304
 $7,182
 $12,760
 $19,856
 $6,904
 $12,151
$14,287
 $13,122
Allowance for loan losses as a percentage of retail finance receivables, net of fees2.9% 1.2% 2.4% 3.1% 1.1% 2.4%2.8% 2.9%
_________________ 
(a)
Average amount of outstanding contracts consists of retail finance receivables, net of fees, divided by number of outstanding contracts.
At March 31,September 30, 2017, the allowance for loan losses for the North America Segment as a percentage of retail finance receivables, net of fees, decreased from the level at December 31, 2016 consistent with the improved credit mix in our portfolio resulting from our expansion of prime lending.
Delinquency The following is a summaryallowance for loan losses reflects our estimate of the contractual amounts of delinquent retail finance receivables,impact on credit losses resulting from hurricane activity during the three months ended September 30, 2017, which is not materially different than recorded investment that are (i) more than 30 days delinquent, but not yet in repossession and (ii) in repossession, but not yet charged off:
 March 31, 2017 March 31, 2016
 North America International Total Percent of Contractual Amount Due North America International Total Percent of Contractual Amount Due
31 - 60 days$883
 $123
 $1,006
 2.8% $841
 $122
 $963
 3.1%
Greater than 60 days313
 128
 441
 1.2
 312
 109
 421
 1.4
Total finance receivables more than 30 days delinquent1,196
 251
 1,447
 4.0
 1,153
 231
 1,384
 4.5
In repossession43
 8
 51
 0.1
 41
 7
 48
 0.2
Total finance receivables more than 30 days delinquent or in repossession$1,239
 $259
 $1,498
 4.1% $1,194
 $238
 $1,432
 4.7%
we expect to be minimal.

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Deferrals In accordance with our policies and guidelines in the North America Segment, we at times,may offer payment deferrals to retail customers, whereby the borrower is allowed to move up to two delinquent payments to the end of the loan generally by paying a fee (approximately the interest portion of the payment deferred, except where state law provides for a lesser amount). Our policies and guidelines limit the number and frequency of defermentsdeferrals that may be granted. Additionally, we generally limit the granting of defermentsdeferrals on new accounts until a requisite number of payments have been received. Contracts receiving a payment deferral as an average quarterly percentage of average retail finance receivables outstanding were 4.3% andincreased to 6.1% for the three months ended September 30, 2017 from 5.1% for the three months ended March 31,September 30, 2016 primarily due to deferrals granted on accounts of borrowers who were impacted by hurricane activity during the quarter. Contracts receiving a payment deferral as an average quarterly percentage of average retail finance receivables outstanding were 4.9% and 5.1% for the nine months ended September 30, 2017 and 2016. Deferrals in the International Segment arewere insignificant.
Delinquency and Troubled Debt Restructurings Refer to Note 4 - "Finance Receivables" to our condensed consolidated financial statements for further discussion of delinquent retail finance receivables and TDRs.
Net Charge-offs The following table presents charge-off data with respect to our retail finance receivables portfolio:
Three Months Ended March 31,
2017 2016 Three Months Ended September 30, Nine Months Ended September 30,
North America International Total North America International Total 2017 2016 2017 2016
Charge-offs$266
 $41
 $307
 $259
 $34
 $293
 $286
 $284
 $856
 $826
Less: recoveries(135) (12) (147) (139) (11) (150) (135) (128) (420) (403)
Net charge-offs$131
 $29
 $160
 $120
 $23
 $143
 $151
 $156
 $436
 $423
Net charge-offs as an annualized percentage(a)
2.3% 1.0% 1.9% 2.6% 0.8% 1.9% 1.9% 2.5% 1.9% 2.4%
Recovery percentage(b)
51.6%     54.1%     
_________________ 
(a)Net charge-offs as an annualized percentage is calculated as a percentage of average retail finance receivables.
(b)
Recovery percentage is a percentage of gross repossession charge-offs. Charge-offs for the International Segment primarily include the write-down of receivables to net realizable value. As a result, a calculation of recoveries as a percentage of gross charge-offs is not meaningful. The decrease in the recovery rate for North America reflects moderation in used car prices, due primarily to an increase in supply.
Net charge-offs as an annualized percentage of average retail finance receivables decreased during the three and nine months ended September 30, 2017 from the prior period, primarily due to the shift in the North America receivables portfolio toward prime credit quality and due to growth in the North America portfolio. The recovery rate as a percentage of gross repossession charge-offs in North America was 51.8% and 52.4% for the three and nine months ended September 30, 2017 and 52.3% and 53.8% for the three and nine months ended September 30, 2016.
Commercial Finance Receivables
March 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
North America International Total North America International Total
Commercial finance receivables, net of fees$7,016
 $4,796
 $11,812
 $6,527
 $4,596
 $11,123
$9,495
 $7,880
Less: allowance for loan losses(34) (20) (54) (30) (20) (50)(49) (40)
Total commercial finance receivables, net$6,982
 $4,776
 $11,758
 $6,497
 $4,576
 $11,073
$9,446
 $7,840
Number of dealers829
 2,138
 2,967
 792
 2,150
 2,942
1,502
 1,356
Average carrying amount per dealer$8
 $2
 $4
 $8
 $2
 $4
$6
 $6
Allowance for loan losses as a percentage of commercial finance receivables, net of fees0.5% 0.4% 0.5% 0.5% 0.4% 0.4%0.5% 0.5%
There were insignificant charge-offs of commercial finance receivables during the three and nine months ended March 31,September 30, 2017 and none during the three and nine months ended March 31,September 30, 2016. At March 31,September 30, 2017 and December 31, 2016, substantially all of our commercial finance receivables were current with respect to payment status and none were classified as TDRs. The inventory securing our commercial finance receivables is generally covered by insurance; therefore, we do not expect any significant impact to credit losses resulting from hurricane activity during the three months ended September 30, 2017.
Leased Vehicles At March 31,September 30, 2017 and 2016, 99.2% and 99.1% of our operating leases were current with respect to payment status. Our leased vehicles are generally insured; therefore, we do not expect any significant losses resulting from hurricane activity during the three months ended September 30, 2017.

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Liquidity and Capital Resources
General Our primary sources of cash are finance charge income, leasing income and proceeds from the sale of terminated leased vehicles, servicing fees, net distributions from secured debt facilities, including securitizations, secured and unsecured borrowings and collections and recoveries on finance receivables. Our primary uses of cash are purchases of retail finance receivables and leased vehicles, the funding of commercial finance receivables, repayment of secured and unsecured debt, funding credit enhancement requirements in connection with securitizations and secured credit facilities, operating expenses and interest costs.
In the North America Segment, ourOur purchase and funding of retail and commercial finance receivables and leased vehicles are financed initially utilizing cash and borrowings on our secured credit facilities. Subsequently, our strategy is towe typically obtain long-term financing for finance receivables and leased vehicles through securitization transactions and the issuance of unsecured debt.
In the International Segment, our purchase and funding of finance receivables are typically financed with borrowings on secured and unsecured credit facilities. In certain countries where the debt capital and securitization markets are sufficiently developed, such as in Germany and the U.K., we obtain long-term financing through securitization transactions. In addition, we raise unsecured debt in the international capital markets through the issuance of notes under our Euro medium term note program and accept deposits from retail banking customers in Germany.
Cash Flow During the threenine months ended March 31,September 30, 2017, net cash provided by operating activities increased due primarily to increased leasean increase in net leased vehicle income, resulting from growth in the leased vehicle portfolio, partially offset by increased interest expense and increased operating expenses.
During the threenine months ended March 31,September 30, 2017, net cash used in investing activities increased due to an increase in net purchases of retail finance receivables of $2.2$4.9 billion and an increase in net fundings of commercial finance receivables of $0.4 billion, partially offset by a decrease in purchases of leased vehicles of $364 million, a decrease in net fundings of commercial finance receivables of $483$130 million, increased collections and recoveries on retail finance receivables of $324 million,$2.0 billion, and an increase in proceeds received on terminated leases of $601 million.$2.9 billion.
During the threenine months ended March 31,September 30, 2017, net cash provided by financing activities increased due primarily to the issuance of preferred stock of $985 million and an increase in borrowings, net of repayments, of $231$146 million.
LiquidityMarch 31, 2017 December 31, 2016September 30, 2017 December 31, 2016
Cash and cash equivalents(a)
$2,694
 $3,201
$3,976
 $2,815
Borrowing capacity on unpledged eligible assets8,268
 9,506
12,661
 8,321
Borrowing capacity on committed unsecured lines of credit421
 445
132
 105
Borrowing capacity on the Junior Subordinated Revolving Credit Facility1,000
 1,000
1,000
 1,000
Available liquidity$12,383
 $14,152
$17,769
 $12,241
_________________
(a)
Includes $585$377 million and $839$454 million in unrestricted cash outside of the U.S. at March 31,September 30, 2017 and December 31, 2016. This cash is considered to be indefinitely invested based on specific plans for reinvestment of these earnings.
During the threenine months ended March 31,September 30, 2017, available liquidity decreasedincreased due primarily to increasedan increase in cash and additional capacity on new and renewed secured credit facility utilization due to asset growth, which lowers borrowing capacity.facilities, resulting from the issuance of secured and unsecured debt and preferred stock.
We have the ability to borrow up to $1.0 billion under GM's three-year, $4.0 billion unsecured revolving credit facility and up to $3.0 billion under GM's five-year, $10.5 billion unsecured revolving credit facility, subject to available capacity. Our borrowings under GM's facilities are limited by GM's ability to borrow the entire amount available under the facilities. Therefore, we may be able to borrow up to $4.0 billion in total or may be unable to borrow depending on GM's borrowing activity. If we do borrow under these facilities, we expect such borrowings would be short-term in nature and, except in extraordinary circumstances, would not be used to fund our operating activities in the ordinary course of business. Neither we, nor any of our subsidiaries, guarantee any obligations under these facilities and none of our assets secure these facilities. Liquidity available to us under the GM unsecured revolving credit facilities is not included in the table above. At March 31,September 30, 2017, we had no amounts borrowed under either of GM's unsecured revolving credit facilities.
Credit Facilities In the normal course of business, in addition to using our available cash, we utilize borrowings under our credit facilities, which may be secured and/or structured as securitizations, or may be unsecured, and we repay these borrowings as appropriate under our liquidity management strategy.

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At March 31,September 30, 2017, credit facilities consist of the following:
Facility Type Facility Amount Advances Outstanding Facility Amount Advances Outstanding
Revolving retail asset-secured facilities(a)
 $21,773
 $11,459
 $21,077
 $4,563
Revolving commercial asset-secured facilities(b)
 4,312
 406
 3,920
 188
Total secured 26,085
 11,865
 24,997
 4,751
Unsecured committed facilities(c)
 1,370
 949
 132
 
Unsecured uncommitted facilities(d)
 2,504
 2,504
 2,162
 2,162
Total unsecured 3,874
 3,453
 2,294
 2,162
Junior Subordinated Revolving Credit Facility 1,000
 
 1,000
 
Total $30,959
 $15,318
 $28,291
 $6,913
_________________
(a)Includes committed and uncommitted revolving credit facilities backed by retail finance receivables and leases. The financial institutions providing the uncommitted facilities are not contractually obligated to advance funds under them.  We had $270$158 million in advances outstanding and $720$831 million in unused borrowing capacity on these facilities at March 31,September 30, 2017.
(b)Includes revolving credit facilities backed by loans to dealers for floorplan financing.
(c)Does not include $4.0 billion in liquidity available to us under GM's unsecured revolving credit facilities.
(d)The financial institutions providing the uncommitted facilities are not contractually obligated to advance funds under them. We had $1.2$1.3 billion in unused borrowing capacity on these facilities at March 31,September 30, 2017.

Refer to Note 8 - "Debt" to our consolidated financial statements in our Form 10-K for further discussion of the terms of our revolving credit facilities.
Securitization Notes Payable We periodically finance our retail and commercial finance receivables and leases through public and private term securitization transactions, where the securitization markets are sufficiently developed. A summary of securitization notes payable is as follows:
Year of Transaction 
Maturity Date(a)
 
Original Note
Issuance
(b)
 Note Balance
At March 31, 2017
 
Maturity Date(a)
 
Original Note
Issuance
(b)
 Note Balance
At September 30, 2017
2012 February 2020-May 2020 $2,300
 $241
2013 July 2020-October 2021 $5,058
 874
 October 2020-October 2021 $4,058
 $523
2014 April 2019-September 2022 $10,005
 2,870
 July 2019-March 2022 $6,336
 1,685
2015 July 2019-December 2023 $14,348
 8,125
 July 2019-December 2023 $13,110
 5,553
2016 April 2018-November 2024 $17,786
 14,718
 April 2018-September 2024 $15,528
 10,652
2017 January 2020-February 2025 $4,003
 3,950
 August 2019-February 2025 $19,039
 17,686
Total active securitizations   30,778
   36,099
Debt issuance costs   (64)   (75)
Total   $30,714
   $36,024
_________________ 
(a)Maturity dates represent legal final maturity of issued notes. The notes are expected to be paid based on amortization of the finance receivables and leases pledged.
(b)At historical foreign currency exchange rates at the time of issuance.
Our securitizations utilize special purpose entities which are also VIEs that meet the requirements to be consolidated in our financial statements. Refer to Note 8 - "Variable Interest Entities" to our condensed consolidated financial statements in this Form 10-Q for further discussion.
Senior Notes Retail Customer Deposits and Other Unsecured Debt We periodically access the debt capital markets through the issuance of senior unsecured notes, predominantly from registered shelves in the U.S., Europe and Europe.Mexico. At March 31,September 30, 2017, the par value of our outstanding senior notes was $31.5$35.2 billion.
We issue other unsecured debt through commercial paper offerings and other non-bank funding sources primarily in the International Segment.sources. At March 31,September 30, 2017, we had $916 million$1.3 billion of this type of unsecured debt outstanding. We accept deposits
Support Agreement At September 30, 2017, our earning assets leverage ratio was 10.23, and the applicable threshold was 11.50.

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from retail banking customers in Germany. At March 31, 2017, the outstanding balance of these deposits was $1.9 billion, of which 41% were overnight deposits.
Support Agreement At March 31, 2017, our earning assets leverage ratio was 10.9, and the applicable ratio was 11.5.

Forward-Looking Statements
This report contains several "forward-looking statements." Forward-looking statements are those that use words such as "believe," "expect," "intend," "plan," "may," "likely," "should," "estimate," "continue," "future" or "anticipate" and other comparable expressions. These words indicate future events and trends. Forward-looking statements are our current views with respect to future events and financial performance. These forward-looking statements are subject to many assumptions, risks and uncertainties that could cause actual results to differ significantly from historical results or from those anticipated by us. The most significant risks are detailed from time to time in our filings and reports with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K for the year ended December 31, 2016. It is advisable not to place undue reliance on our forward-looking statements. We undertake no obligation to, and do not, publicly update or revise any forward-looking statements, except as required by federal securities laws, whether as a result of new information, future events or otherwise.
The following factors are among those that may cause actual results to differ materially from historical results or from the forward-looking statements:
GM's ability to sell new vehicles that we finance in the markets we serve in North America, Latin America, China and Europe, particularly in the U.K. where automobile sales may be negatively impacted due to the passage of the referendum to discontinue its membership in the European Union;serve;
the viability of GM-franchised dealers that are commercial loan customers;
the availability and cost of sources of financing;
our joint venture in China, which we cannot operate solely for our benefit and over which we have limited control;
the level of net charge-offs, delinquencies and prepayments on the loans and leases we originate;
the effect, interpretation or application of new or existing laws, regulations, court decisions and accounting pronouncements;
the prices at which used cars are sold in the wholesale auction markets;
vehicle return rates and the residual value performance on vehicles we lease;
interest rate fluctuations and certain related derivatives exposure;
foreign currency exchange rate fluctuations;
our financial condition and liquidity, as well as future cash flows and earnings;
changes in general economic and business conditions;
competition;
our ability to manage risks related to security breaches and other disruptions to our networks and systems;
changes in business strategy, including expansion of product lines and credit risk appetite, acquisitions and divestitures; and
risks and uncertainties associated with the consummation of the sale of the TransferredGM's European Business to the PSA Group,Peugeot S.A., including satisfaction of the closing conditions.
If one or more of these risks or uncertainties materialize, or if underlying assumptions prove incorrect, our actual results may vary materially from those expected, estimated or projected.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no significant changes in our exposure to market risk since December 31, 2016. Refer to Item 7A - "Quantitative and Qualitative Disclosures About Market Risk" in our 2016 Form 10-K.
Item 4. Controls and Procedures
Disclosure Controls and Procedures We maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and accumulated and communicated to our management, including our principal executive officer (CEO) and principal financial officer (CFO), as appropriate to allow timely decisions regarding required disclosure.
Our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) promulgated under the Exchange Act) at March 31,September 30, 2017. Based on this

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evaluation, required by paragraph (b) of Rule 13a-15 and/or 15d-15, our CEO and CFO concluded that our disclosure controls and procedures were effective as of March 31,September 30, 2017.

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Changes in Internal Control Over Financial Reporting There have not been any changes in our internal control over financial reporting during the three months ended March 31,September 30, 2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II
Item 1. Legal Proceedings
Refer to Note 10 -"Commitments and Contingencies" to our condensed consolidated financial statements for information relating to certain legal proceedings.
Item 1A. Risk Factors
We face a number of significant risks and uncertainties in connection with our operations. Our business, results of operations and financial condition could be materially adversely affected by these risks factors. There have been no material changes to the Risk Factors disclosed in our 2016 Form 10-K.


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Item 6. Exhibits
2.1*  Filed Herewith
     
3.1  Filed HerewithIncorporated by Reference
     
  Filed Herewith
     
  
Furnished with
this Report
     
101.INS XBRL Instance Document Filed Herewith
     
101.SCH XBRL Taxonomy Extension Schema Document Filed Herewith
     
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document Filed Herewith
     
101.DEF XBRL Taxonomy Extension Definition Linkbase Document Filed Herewith
     
101.LAB XBRL Taxonomy Extension Label Linkbase Document Filed Herewith
     
101.PRE XBRL Taxonomy Presentation Linkbase Document Filed Herewith
__________
*The Company agrees to furnish supplementally a copy of any omitted exhibit or schedule to the Securities and Exchange Commission upon request.
Instruments defining the rights of holders of certain issues of long-term debt of General Motors Financial Company, Inc. have not been filed as exhibits because the authorized principal amount of any one of such issues does not exceed 10% of the total assets of General Motors Financial Company, Inc. General Motors Financial Company, Inc. will furnish a copy of each such instrument to the SEC upon request.




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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
     General Motors Financial Company, Inc.
     (Registrant)
      
Date:April 28,October 24, 2017 By: 
/S/    CHRIS A. CHOATE        
     (Signature)
     Chris A. Choate
     Executive Vice President and
     Chief Financial Officer


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