Document and Entity Information
Document and Entity Information | 3 Months Ended |
Jan. 31, 2021shares | |
Document and Entity Information | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Transition Report | false |
Document Period End Date | Jan. 31, 2021 |
Entity File Number | 1-6458 |
Entity Registrant Name | DEERE JOHN CAPITAL CORP |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 36-2386361 |
Entity Address, Address Line One | 10587 Double R Boulevard, Suite 100 |
Entity Address, City or Town | Reno |
Entity Address, State or Province | NV |
Entity Address, Postal Zip Code | 89521 |
City Area Code | 775 |
Local Phone Number | 786-5527 |
Title of 12(b) Security | 2.75% Senior Notes Due 2022 |
Trading Symbol | DE22B |
Security Exchange Name | NYSE |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 2,500 |
Current Fiscal Year End Date | --10-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | Q1 |
Entity Central Index Key | 0000027673 |
Amendment Flag | false |
Statement of Consolidated Incom
Statement of Consolidated Income - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Revenues | ||
Finance income earned on retail notes | $ 237.3 | $ 234.8 |
Revolving charge account income | 72.9 | 80.7 |
Finance income earned on wholesale receivables | 73.3 | 110.3 |
Lease revenues | 263.6 | 274.9 |
Other income | 9.9 | 17.9 |
Total revenues | 657 | 718.6 |
Expenses | ||
Interest expense | 134 | 219.8 |
Operating expenses: | ||
Administrative and operating expenses | 92.5 | 123.5 |
Fees paid to John Deere | 31.5 | 24.9 |
Provision (credit) for credit losses | (0.6) | 12.1 |
Depreciation of equipment on operating leases | 194.8 | 213.5 |
Total operating expenses | 318.2 | 374 |
Total expenses | 452.2 | 593.8 |
Income of consolidated group before income taxes | 204.8 | 124.8 |
Provision for income taxes | 39 | 26.1 |
Income of consolidated group | 165.8 | 98.7 |
Equity in income of unconsolidated affiliate | 0.9 | 0.7 |
Net income | 166.7 | 99.4 |
Less: Net income attributable to noncontrolling interests | 0.2 | |
Net income attributable to the Company | $ 166.7 | $ 99.2 |
Statement of Consolidated Compr
Statement of Consolidated Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Statement of Consolidated Comprehensive Income | ||
Net income | $ 166.7 | $ 99.4 |
Other comprehensive income (loss), net of income taxes | ||
Cumulative translation adjustment | 35.7 | (4.8) |
Unrealized gain (loss) on derivatives | 3 | (0.3) |
Unrealized gain (loss) on debt securities | 0.1 | (0.4) |
Other comprehensive income (loss), net of income taxes | 38.8 | (5.5) |
Comprehensive income of consolidated group | 205.5 | 93.9 |
Less: Comprehensive income attributable to noncontrolling interests | 0.2 | |
Comprehensive income attributable to the Company | $ 205.5 | $ 93.7 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Assets | |||
Cash and cash equivalents | $ 622.5 | $ 674.6 | $ 642.6 |
Marketable securities | 2.2 | 2.2 | 2.3 |
Receivables: | |||
Total receivables | 33,489.3 | 33,557.3 | 31,722.9 |
Allowance for credit losses | (149.5) | (129.1) | (103.1) |
Total receivables - net | 33,339.8 | 33,428.2 | 31,619.8 |
Other receivables | 100.4 | 88.1 | 94.6 |
Receivables from John Deere | 487.7 | 583.2 | 408.7 |
Equipment on operating leases - net | 5,032.6 | 5,297.8 | 5,525.7 |
Notes receivable from John Deere | 300 | 350 | 282.5 |
Investment in unconsolidated affiliate | 20.9 | 19.3 | 17 |
Deferred income taxes | 31.1 | 27.1 | 34 |
Other assets | 388.7 | 386.7 | 447.1 |
Total Assets | 40,325.9 | 40,857.2 | 39,074.3 |
Short-term borrowings: | |||
Commercial paper and other notes payable | 314.1 | 187.5 | 1,241.7 |
Securitization borrowings | 3,951.5 | 4,656.2 | 4,373.9 |
John Deere | 5,227.4 | 5,249.5 | 1,395.5 |
Current maturities of long-term borrowings | 5,686.8 | 5,741.6 | 5,577.6 |
Total short-term borrowings | 15,179.8 | 15,834.8 | 12,588.7 |
Other payables to John Deere | 43.9 | 30.1 | 36.6 |
Accounts payable and accrued expenses | 805.2 | 922.3 | 857.5 |
Deposits withheld from dealers and merchants | 126.9 | 114.8 | 128.5 |
Deferred income taxes | 330.1 | 345.9 | 503.8 |
Long-term borrowings | 19,497.5 | 19,311.1 | 20,861.9 |
Total liabilities | 35,983.4 | 36,559 | 34,977 |
Commitments and contingencies (Note 8) | |||
Stockholder's equity: | |||
Common stock, without par value (issued and outstanding - 2,500 shares owned by John Deere Financial Services, Inc.) | 1,482.8 | 1,482.8 | 1,482.8 |
Retained earnings | 2,897.1 | 2,891.6 | 2,715.8 |
Accumulated other comprehensive loss | (39) | (77.8) | (102.9) |
Total Company stockholder's equity | 4,340.9 | 4,296.6 | 4,095.7 |
Noncontrolling interests | 1.6 | 1.6 | 1.6 |
Total stockholder's equity | 4,342.5 | 4,298.2 | 4,097.3 |
Total Liabilities and Stockholder's Equity | 40,325.9 | 40,857.2 | 39,074.3 |
Retail notes | Unrestricted | |||
Receivables: | |||
Total receivables | 18,364.6 | 17,158 | 14,791.5 |
Retail notes | Securitized | |||
Receivables: | |||
Total receivables | 3,928 | 4,689.2 | 4,443.7 |
Revolving charge accounts | |||
Receivables: | |||
Total receivables | 2,621.7 | 3,827.4 | 2,673.2 |
Allowance for credit losses | (24.3) | (42.3) | (39.3) |
Wholesale Receivables | |||
Receivables: | |||
Total receivables | 7,835.5 | 7,093.3 | 9,146.3 |
Allowance for credit losses | (9.5) | (9.9) | (9.9) |
Financing Leases | |||
Receivables: | |||
Total receivables | $ 739.5 | $ 789.4 | $ 668.2 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - shares | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Consolidated Balance Sheet | |||
Common stock, issued shares | 2,500 | 2,500 | 2,500 |
Common stock, outstanding shares | 2,500 | 2,500 | 2,500 |
Statement of Consolidated Cash
Statement of Consolidated Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Cash Flows from Operating Activities: | ||
Net income | $ 166.7 | $ 99.4 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Provision (credit) for credit losses | (0.6) | 12.1 |
Provision for depreciation and amortization | 199.8 | 217.2 |
Credit for deferred income taxes | (13.9) | (24.1) |
Undistributed earnings of unconsolidated affiliate | (0.9) | (0.7) |
Change in accounts payable and accrued expenses | (58.6) | (17.7) |
Change in accrued income taxes payable/receivable | (32.7) | 5.5 |
Other | 40.9 | 50.3 |
Net cash provided by operating activities | 300.7 | 342 |
Cash Flows from Investing Activities: | ||
Cost of receivables acquired (excluding wholesale) | (5,041.8) | (4,151.3) |
Collections of receivables (excluding wholesale) | 5,898.2 | 5,593.2 |
Increase in wholesale receivables - net | (632.5) | (452) |
Cost of equipment on operating leases acquired | (305.9) | (543.4) |
Proceeds from sales of equipment on operating leases | 356.3 | 332.6 |
Cost of notes receivable acquired from John Deere | (33) | (22.3) |
Collections of notes receivable from John Deere | 91.6 | 31.2 |
Other | (5.2) | (12.7) |
Net cash provided by investing activities | 327.7 | 775.3 |
Cash Flows from Financing Activities: | ||
Increase (decrease) in commercial paper and other notes payable - net | 126.7 | (219.6) |
Increase (decrease) in securitization borrowings - net | (705.8) | 95.9 |
Decrease in payable to John Deere - net | (123.6) | (445.4) |
Proceeds from issuance of long-term borrowings | 1,523.1 | 1,105 |
Payments of long-term borrowings | (1,367.7) | (1,501.3) |
Dividends paid | (135) | (125) |
Debt issuance costs | (9.1) | (7.5) |
Net cash used for financing activities | (691.4) | (1,097.9) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 6.7 | (1.2) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (56.3) | 18.2 |
Cash, cash equivalents, and restricted cash at beginning of period | 769.4 | 710.9 |
Cash, cash equivalents, and restricted cash at end of period | $ 713.1 | $ 729.1 |
Statement of Consolidated Cas_2
Statement of Consolidated Cash Flows (Parenthetical) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 | Nov. 03, 2019 |
Statement of Consolidated Cash Flows | ||||
Restricted cash | $ 90.6 | $ 94.8 | $ 86.5 | $ 78.3 |
Statement of Changes in Consoli
Statement of Changes in Consolidated Stockholder's Equity - USD ($) $ in Millions | Common Stock | Retained EarningsCumulative Effect from Adoption | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-Controlling Interests | Cumulative Effect from Adoption | Total |
Balance at Nov. 03, 2019 | $ 1,482.8 | $ 2,741.6 | $ (97.4) | $ 1.4 | $ 4,128.4 | ||
Increase (Decrease) in Stockholder's Equity | |||||||
Net income | 99.2 | 0.2 | 99.4 | ||||
Other comprehensive income (loss) | (5.5) | (5.5) | |||||
Dividends declared | (125) | (125) | |||||
Balance at Feb. 02, 2020 | 1,482.8 | 2,715.8 | (102.9) | 1.6 | 4,097.3 | ||
Balance (ASU 2016-13) at Nov. 01, 2020 | $ (26.2) | $ (26.2) | |||||
Balance at Nov. 01, 2020 | 1,482.8 | 2,891.6 | (77.8) | 1.6 | 4,298.2 | ||
Increase (Decrease) in Stockholder's Equity | |||||||
Net income | 166.7 | 166.7 | |||||
Other comprehensive income (loss) | 38.8 | 38.8 | |||||
Dividends declared | (135) | (135) | |||||
Balance at Jan. 31, 2021 | $ 1,482.8 | $ 2,897.1 | $ (39) | $ 1.6 | $ 4,342.5 |
Organization and Consolidation
Organization and Consolidation | 3 Months Ended |
Jan. 31, 2021 | |
Organization and Consolidation | |
Organization and Consolidation | (1) Organization and Consolidation John Deere Capital Corporation (Capital Corporation) and its subsidiaries are collectively called the Company. John Deere Financial Services, Inc. (JDFS), a wholly-owned finance holding subsidiary of Deere & Company, owns all of the outstanding common stock of Capital Corporation. The Company provides and administers financing for retail purchases of new equipment manufactured by Deere & Company’s production and precision agriculture operations, small agriculture and turf operations, and construction and forestry operations and used equipment taken in trade for this equipment. The Company generally purchases retail installment sales and loan contracts (retail notes) from Deere & Company and its wholly-owned subsidiaries (collectively called John Deere). John Deere generally acquires these retail notes through John Deere retail dealers. The Company also purchases and finances a limited amount of non-Deere retail notes. The Company also finances and services revolving charge accounts, in most cases acquired from and offered through merchants in the agriculture and turf and construction and forestry markets (revolving charge accounts). The Company also provides wholesale financing for inventories of John Deere agriculture and turf and construction and forestry equipment for dealers of those products (wholesale receivables). In addition, the Company leases John Deere equipment and a limited amount of non-Deere equipment to retail customers (financing and operating leases). The Company also offers credit enhanced international export financing to select customers and dealers, which generally involves John Deere products. Retail notes, revolving charge accounts, wholesale receivables, and financing leases are collectively called “Receivables.” Receivables and equipment on operating leases are collectively called “Receivables and Leases.” The Company generally secures its Receivables, other than certain revolving charge accounts, by retaining as collateral a security interest in the goods associated with those Receivables or with the use of other collateral. Beginning in fiscal year 2021, John Deere implemented a new strategy, operating model, and reporting structure. With this change, John Deere’s agriculture and turf operations were divided into two new segments: production and precision agriculture and small agriculture and turf. There were no changes to John Deere’s construction and forestry or financial services segments. Receivables and Leases managed by the Company continue to be evaluated by market (agriculture and turf and construction and forestry). References to agriculture and turf include both production and precision agriculture and small agriculture and turf. The Company has prepared its interim consolidated financial statements, without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the U.S. have been condensed or omitted as permitted by such rules and regulations. All adjustments, consisting of normal recurring adjustments, have been included. Management believes that the disclosures are adequate to present fairly the financial position, results of operations, and cash flows at the dates and for the periods presented. It is suggested that these interim consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto appearing in the Company’s latest annual report on Form 10-K. Results for interim periods are not necessarily indicative of those to be expected for the fiscal year. The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts and related disclosures. The COVID-19 (COVID) pandemic has resulted in uncertainties in the Company’s business, which may result in actual outcomes differing from those estimates. The Company uses a 52/53 week fiscal year with quarters ending on the last Sunday in the reporting period. The first quarter ends for fiscal year 2021 and 2020 were January 31, 2021 and February 2, 2020, respectively. Both periods contained 13 weeks. |
New Accounting Standards
New Accounting Standards | 12 Months Ended |
Oct. 31, 2021 | |
New Accounting Standards | |
New Accounting Standards | (2) New Accounting Standards New Accounting Standards Adopted In the first quarter of 2021, the Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments, which establishes Accounting Standards Codification (ASC) 326, Financial Instruments – Credit Losses. This ASU was adopted using a modified-retrospective The Company holds deposits from dealers (dealer deposits), which are recorded in deposits withheld from dealers and merchants, to absorb certain credit losses. Prior to adopting this ASU, the allowance for credit losses was estimated on probable credit losses incurred after consideration of recoveries from dealer deposits. The ASU considers dealer deposits and certain credit insurance contracts as freestanding credit enhancements. As a result, after adoption, credit losses recovered from dealer deposits and certain credit insurance contracts are presented in other income and no longer as part of the allowance for credit losses or the provision for credit losses. The ASU also modified the treatment of the estimated write-off on delinquent receivables by no longer including the estimated benefit of charges to the dealer deposits in the write-off amount (see Note 4). This change increases the estimated write-offs on delinquent financing receivables with the benefit of credit losses recovered from dealer deposits presented in other income. This benefit, in both situations, is recorded when the dealer deposits are charged and no longer based on estimated recoveries. The effects of adopting the ASU on the consolidated balance sheet were as follows (in millions of dollars): November 1 Cumulative Effect November 2 2020 from Adoption 2020 Assets Allowance for credit losses $ (129.1) $ (19.7) $ (148.8) Deferred income taxes 27.1 .7 27.8 Liabilities Accounts payable and accrued expenses $ 922.3 $ (.5) $ 921.8 Deposits withheld from dealers and merchants 114.8 13.5 128.3 Deferred income taxes 345.9 (5.8) 340.1 Stockholder’s equity Retained earnings $ 2,891.6 $ (26.2) $ 2,865.4 Note 4 contains additional disclosures as well as the Company’s updated allowance for credit losses accounting policy. The Company also adopted the following standards in 2021, none of which had a material effect on the Company’s consolidated financial statements: Accounting Standards Updates No. 2018-15 Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which amends ASC 350-40, Intangibles – Goodwill and Other – Internal-Use Software No. 2019-04 Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments No. 2021-01 Reference Rate Reform (Topic 848): Scope New Accounting Standards to be Adopted The Company will adopt the following standards in future periods, none of which are expected to have a material effect on the Company’s consolidated financial statements: Accounting Standards Updates No. 2019-12 Simplifying the Accounting for Income Taxes, which amends ASC 740, Income Taxes No. 2020-08 Codification Improvements to Subtopic 310-20, Receivables – Nonrefundable Fees and Other Costs |
Other Comprehensive Income Item
Other Comprehensive Income Items | 3 Months Ended |
Jan. 31, 2021 | |
Other Comprehensive Income Items | |
Other Comprehensive Income Items | (3) Other Comprehensive Income Items The after-tax changes in accumulated other comprehensive income (loss) were as follows (in millions of dollars): Unrealized Unrealized Accumulated Cumulative Gain (Loss) Gain (Loss) Other Translation on on Comprehensive Adjustment Derivatives Debt Securities Income (Loss) Balance November 3, 2019 $ (88.4) $ (7.0) $ (2.0) $ (97.4) Other comprehensive income (loss) items before reclassification (4.8) (1.2) (.4) (6.4) Amounts reclassified from accumulated other comprehensive income .9 .9 Net current period other comprehensive income (loss) (4.8) (.3) (.4) (5.5) Balance February 2, 2020 $ (93.2) $ (7.3) $ (2.4) $ (102.9) Balance November 1, 2020 $ (69.5) $ (6.7) $ (1.6) $ (77.8) Other comprehensive income (loss) items before reclassification 35.7 (.4) .1 35.4 Amounts reclassified from accumulated other comprehensive income 3.4 3.4 Net current period other comprehensive income (loss) 35.7 3.0 .1 38.8 Balance January 31, 2021 $ (33.8) $ (3.7) $ (1.5) $ (39.0) Amounts recorded in and reclassifications out of other comprehensive income (loss), and the income tax effects were as follows (in millions of dollars): Before Tax After Tax (Expense) Tax Three Months Ended January 31, 2021 Amount Credit Amount Cumulative translation adjustment $ 35.7 $ 35.7 Unrealized gain (loss) on derivatives: Unrealized hedging gain (loss) (.5) $ .1 (.4) Reclassification of realized (gain) loss to: Interest rate contracts – Interest expense 4.3 (.9) 3.4 Net unrealized gain (loss) on derivatives 3.8 (.8) 3.0 Unrealized gain (loss) on debt securities: Unrealized holding gain (loss) .1 .1 Total other comprehensive income (loss) $ 39.6 $ (.8) $ 38.8 Three Months Ended February 2, 2020 Cumulative translation adjustment $ (4.8) $ (4.8) Unrealized gain (loss) on derivatives: Unrealized hedging gain (loss) (1.6) $ .4 (1.2) Reclassification of realized (gain) loss to: Interest rate contracts – Interest expense 1.2 (.3) .9 Net unrealized gain (loss) on derivatives (.4) .1 (.3) Unrealized gain (loss) on debt securities: Unrealized holding gain (loss) (.9) .5 (.4) Total other comprehensive income (loss) $ (6.1) $ .6 $ (5.5) |
Receivables
Receivables | 3 Months Ended |
Jan. 31, 2021 | |
Receivables | |
Receivables | (4) Receivables Credit Quality The Company monitors the credit quality of Receivables based on delinquency status. Past due balances of Receivables still accruing finance income represent the total balance held (principal plus accrued interest) with any payment amounts 30 days or more past the contractual payment due date. Non-performing Receivables represent loans for which the Company has ceased accruing finance income. Generally, when retail notes, revolving charge accounts financing lease Receivable balances are written off to the allowance for credit losses when, in the judgment of management, they are considered uncollectible. Generally, when retail notes and financing lease Due to the economic effects of COVID, the Company provided short-term relief to dealers and retail customers during 2020, and to a much lesser extent in 2021. The relief was provided in regional programs and on a case-by-case basis with customers that were generally current in their payment obligations. Receivables granted relief represented approximately 4 percent of the Receivables balance at January 31, 2021. The majority of Receivables granted short-term relief during 2020 are beyond the deferral period and have either resumed making payments or are reported as delinquent based on the modified payment schedule. The credit quality analysis of retail notes, financing leases, and revolving charge accounts (collectively, Customer Receivables) at January 31, 2021 was as follows (in millions of dollars): Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Charge Accounts Total Customer Receivables: Agriculture and turf Current $ 2,233.8 $ 8,126.9 $ 4,264.4 $ 2,338.4 $ 1,137.2 $ 464.9 $ 2,498.1 $ 21,063.7 30-59 days past due 2.7 50.0 35.1 24.4 10.8 6.0 26.3 155.3 60-89 days past due .1 13.8 11.7 8.4 3.7 2.8 4.2 44.7 90+ days past due .8 .2 .1 .2 1.3 Non-performing .3 34.4 52.5 40.2 21.6 24.0 6.5 179.5 Construction and forestry Current 582.3 1,723.8 974.0 447.5 123.4 30.1 81.8 3,962.9 30-59 days past due 3.7 46.8 27.9 14.5 4.7 1.2 2.9 101.7 60-89 days past due .4 12.8 15.1 6.5 2.1 .6 1.2 38.7 90+ days past due 8.6 4.9 13.5 Non-performing 23.5 28.8 22.4 11.0 6.1 .7 92.5 Total Customer Receivables $ 2,823.3 $ 10,040.6 $ 5,415.2 $ 2,902.5 $ 1,314.6 $ 535.9 $ 2,621.7 $ 25,653.8 The credit quality analysis of Customer Receivables at November 1, 2020 and February 2, 2020 was as follows (in millions of dollars): November 1, 2020 February 2, 2020 Retail Notes & Financing Leases Revolving Charge Accounts Total Retail Notes & Financing Leases Revolving Charge Accounts Total Customer Receivables: Agriculture and turf Current $ 18,341.2 $ 3,710.3 $ 22,051.5 $ 15,959.9 $ 2,516.8 $ 18,476.7 30-59 days past due 111.4 11.5 122.9 131.9 51.4 183.3 60-89 days past due 47.6 3.5 51.1 57.2 14.1 71.3 90+ days past due 2.0 2.0 3.4 3.4 Non-performing 172.7 5.4 178.1 199.6 5.6 205.2 Construction and forestry Current 3,759.5 92.3 3,851.8 3,310.1 78.8 3,388.9 30-59 days past due 82.0 2.4 84.4 91.0 4.1 95.1 60-89 days past due 38.8 1.1 39.9 36.5 1.4 37.9 90+ days past due 1.9 1.9 Non-performing 79.5 .9 80.4 113.8 1.0 114.8 Total Customer Receivables $ 22,636.6 $ 3,827.4 $ 26,464.0 $ 19,903.4 $ 2,673.2 $ 22,576.6 The credit quality analysis of wholesale receivables at January 31, 2021 was as follows (in millions of dollars): Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Total Wholesale receivables: Agriculture and turf Current $ 78.5 $ 216.5 $ 61.5 $ 17.8 $ 7.5 $ 1.3 $ 6,092.5 $ 6,475.6 30-59 days past due 7.2 7.2 60-89 days past due .2 3.0 3.2 90+ days past due 2.2 2.2 Non-performing 4.1 4.1 Construction and forestry Current 2.6 7.9 5.4 .6 1,323.3 1,339.8 30-59 days past due 3.0 3.0 60-89 days past due .4 .4 90+ days past due Non-performing Total wholesale receivables $ 81.1 $ 224.6 $ 66.9 $ 18.4 $ 7.5 $ 1.3 $ 7,435.7 $ 7,835.5 The credit quality analysis of wholesale receivables at November 1, 2020 and February 2, 2020 was as follows (in millions of dollars): November 1, 2020 February 2, 2020 Wholesale receivables: Agriculture and turf Current $ 5,693.7 $ 7,219.4 30-59 days past due 3.9 7.6 60-89 days past due 4.4 2.3 90+ days past due 1.1 1.5 Non-performing 4.0 9.9 Construction and forestry Current 1,385.9 1,899.6 30-59 days past due .3 3.8 60-89 days past due .1 90+ days past due .3 Non-performing 1.8 Total wholesale receivables $ 7,093.3 $ 9,146.3 Allowance for Credit Losses The allowance for credit losses is an estimate of the credit losses expected over the life of the Company’s Receivable portfolio. The Company measures expected credit losses on a collective basis when similar risk characteristics exist. Risk characteristics considered by the Company include product category, market, geography, credit risk, and remaining duration. Receivables that do not share risk characteristics with other receivables in the portfolio are evaluated on an individual basis. The Company utilizes loss forecast models, which are selected based on the size and credit risk of the underlying pool of receivables, to estimate expected credit losses. Transition matrix models are used for large and complex Customer Receivable pools, while weighted average remaining maturity (WARM) models are used for smaller and less complex Customer Receivable pools. Transition matrix models, which are used for the majority of the Customer Receivables, estimate credit losses using historical delinquency and default information to assign probabilities that a loan will pay as contractually scheduled or become delinquent and advance through the various delinquency stages. The model simulates the runoff of the portfolio, month-by-month, over the life of the loans until the balances are fully repaid or default, using roll rates applied to the outstanding portfolio. The roll rates are applied based on the delinquency status of the customer accounts and are further segmented based on the credit risk and remaining duration of the underlying receivables. Estimated recovery rates are applied to the balance at default to calculate the expected credit losses. The modeled expected credit losses are adjusted based on reasonable and supportable forecasts, which may include economic indicators such as commodity prices, industry equipment sales, unemployment rates, and housing starts. The WARM models apply historical average annual loss rates, adjusted for current and forecasted economic conditions, to the projected portfolio runoff. Expected credit losses on wholesale receivables are based on historical loss rates, adjusted for current economic conditions and reasonable and supportable forecasts. Management reviews each model’s output quarterly, and qualitative adjustments are incorporated as necessary. Recoveries from freestanding credit enhancements, such as dealer deposits, are not included in the estimate of expected credit losses. Recoveries from dealer deposits are recognized in other income on the statement of consolidated income when the dealer’s withholding account is charged. During the three months ended January 31, 2021, $.9 million was recorded in other income related to recoveries from credit enhancements. Prior to the adoption of ASU No. 2016-13, the allowance for credit losses was estimated on probable credit losses incurred after consideration of expected recoveries from credit enhancements. An analysis of the allowance for credit losses and investment in Receivables during 2021 was as follows (in millions of dollars): Three Months Ended January 31, 2021 Retail Notes Revolving & Financing Charge Wholesale Total Leases Accounts Receivables Receivables Allowance: Beginning of period balance $ 76.9 $ 42.3 $ 9.9 $ 129.1 ASU No. 2016-13 adoption* 32.5 (12.2) (.6) 19.7 Provision (credit) for credit losses** 6.7 (9.7) (3.0) Write-offs (4.1) (5.3) (9.4) Recoveries 2.8 9.2 12.0 Translation adjustments .9 .2 1.1 End of period balance $ 115.7 $ 24.3 $ 9.5 $ 149.5 Receivables: End of period balance $ 23,032.1 $ 2,621.7 $ 7,835.5 $ 33,489.3 * ** The allowance for credit losses on Receivables increased $20.4 million in the first quarter of 2021, primarily related to the adoption of ASU No. 2016-13. Following the adoption of the new credit loss standard, the allowance for credit losses on retail notes and financing leases increased slightly, while the allowance on revolving charge accounts decreased, reflecting better than expected payment performance on certain agriculture revolving accounts in the U.S due to improved conditions in the agriculture market. An analysis of the allowance for credit losses and investment in Receivables during 2020 was as follows (in millions of dollars): Three Months Ended February 2, 2020 Retail Notes Revolving & Financing Charge Wholesale Total Leases Accounts Receivables Receivables Allowance: Beginning of period balance $ 53.7 $ 39.3 $ 7.6 $ 100.6 Provision (credit) for credit losses 13.4 (1.1) (.2) 12.1 Write-offs (13.9) (6.4) (.8) (21.1) Recoveries .7 7.5 .8 9.0 Translation adjustments 2.5 2.5 End of period balance $ 53.9 $ 39.3 $ 9.9 $ 103.1 Receivables: End of period balance $ 19,903.4 $ 2,673.2 $ 9,146.3 $ 31,722.9 Troubled Debt Restructurings A troubled debt restructuring is generally the modification of debt in which a creditor grants a concession it would not otherwise consider to a debtor that is experiencing financial difficulties. These modifications may include a reduction of the stated interest rate, an extension of the maturity dates, a reduction of the face amount or maturity amount of the debt, or a reduction of accrued interest. During the first three months of 2021, the Company identified 95 Receivable contracts, primarily retail notes, as troubled debt restructurings with aggregate balances of $5.5 million pre-modification and $5.4 million post-modification. During the first three months of 2020, there were 73 Receivable contracts, primarily retail notes, with aggregate balances of $2.2 million pre-modification and $2.0 million post-modification. The short-term relief related to COVID mentioned on page 11 did not meet the definition of a troubled debt restructuring. During these same periods, there were no significant troubled debt restructurings that subsequently defaulted and were written off. At January 31, 2021, the Company had no commitments to lend additional funds to borrowers whose accounts were modified in troubled debt restructurings. |
Securitization of Receivables
Securitization of Receivables | 3 Months Ended |
Jan. 31, 2021 | |
Securitization of Receivables | |
Securitization of Receivables | (5) Securitization of Receivables The Company, as a part of its overall funding strategy, periodically transfers certain Receivables (retail notes) into variable interest entities (VIEs) that are special purpose entities (SPEs), or non-VIE banking operations, as part of its asset-backed securities programs (securitizations). The structure of these transactions is such that the transfer of the retail notes does not meet the accounting criteria for sales of receivables, and is, therefore, accounted for as a secured borrowing. SPEs utilized in securitizations of retail notes differ from other entities included in the Company’s consolidated statements because the assets they hold are legally isolated. Use of the assets held by the SPEs or the non-VIEs is restricted by terms of the documents governing the securitization transactions. In these securitizations, the retail notes are transferred to certain SPEs or to non-VIE banking operations, which in turn issue debt to investors. The debt securities issued to the third-party investors result in secured borrowings, which are recorded as “Securitization borrowings” on the consolidated balance sheet. The securitized retail notes are recorded as “Retail notes securitized” on the consolidated balance sheet. The total restricted assets on the consolidated balance sheet related to these securitizations include the retail notes securitized less an allowance for credit losses, and other assets primarily representing restricted cash. Restricted cash results from contractual requirements in securitized borrowing arrangements and serves as a credit enhancement. The restricted cash is used to satisfy payment deficiencies, if any, in the required payments on secured borrowings. The balance of restricted cash is contractually stipulated and is either a fixed amount as determined by the initial balance of the retail notes securitized or a fixed percentage of the outstanding balance of the retail notes securitized. The restriction is removed either after all secured borrowing payments are made or proportionally as these receivables are collected and borrowing obligations reduced. For those securitizations in which retail notes are transferred into SPEs, the SPEs supporting the secured borrowings are consolidated unless the Company does not have both the power to direct the activities that most significantly impact the SPEs’ economic performance and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the SPEs. No additional support to these SPEs beyond what was previously contractually required has been provided during the reporting periods. In certain securitizations, the Company consolidates the SPEs since it has both the power to direct the activities that most significantly impact the SPEs’ economic performance through its role as servicer of all the Receivables held by the SPEs and the obligation through variable interests in the SPEs to absorb losses or receive benefits that could potentially be significant to the SPEs. The restricted assets (retail notes securitized, allowance for credit losses, and other assets) of the consolidated SPEs totaled $2,424.7 million, $2,897.5 million, and $2,490.1 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The liabilities (securitization borrowings and accrued interest) of these SPEs totaled $2,403.4 million, $2,856.2 million, and $2,442.1 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The credit holders of these SPEs do not have legal recourse to the Company’s general credit. In certain securitizations, the Company transfers retail notes to non-VIE banking operations, which are not consolidated since the Company does not have a controlling interest in the entities. The Company’s carrying values and interests related to the securitizations with the unconsolidated non-VIEs were restricted assets (retail notes securitized, allowance for credit losses, and other assets) of $463.0 million, $549.7 million, and $596.6 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The liabilities (securitization borrowings and accrued interest) were $453.5 million, $528.1 million, and $567.3 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. In certain securitizations, the Company transfers retail notes into bank-sponsored, multi-seller, commercial paper conduits, which are SPEs that are not consolidated. The Company does not service a significant portion of the conduits’ receivables, and therefore, does not have the power to direct the activities that most significantly impact the conduits’ economic performance. These conduits provide a funding source to the Company (as well as other transferors into the conduit) as they fund the retail notes through the issuance of commercial paper. The Company’s carrying values and variable interest related to these conduits were restricted assets (retail notes securitized, allowance for credit losses, and other assets) of $1,120.0 million, $1,327.3 million, and $1,440.5 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The liabilities (securitization borrowings and accrued interest) related to these conduits were $1,097.0 million, $1,275.1 million, and $1,369.7 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The Company’s carrying amount of the liabilities to the unconsolidated conduits, compared to the maximum exposure to loss related to these conduits, which would only be incurred in the event of a complete loss on the restricted assets was as follows (in millions of dollars): January 31 2021 Carrying value of liabilities $ 1,097.0 Maximum exposure to loss 1,120.0 The total assets of unconsolidated VIEs related to securitizations were approximately $37 billion at January 31, 2021. The components of consolidated restricted assets related to secured borrowings in securitization transactions were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Retail notes securitized $ 3,928.0 $ 4,689.2 $ 4,443.7 Allowance for credit losses (14.7) (12.6) (7.9) Other assets 94.4 97.9 91.4 Total restricted securitized assets $ 4,007.7 $ 4,774.5 $ 4,527.2 The components of consolidated secured borrowings and other liabilities related to securitizations were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Securitization borrowings $ 3,951.5 $ 4,656.2 $ 4,373.9 Accrued interest on borrowings 2.4 3.2 5.2 Total liabilities related to restricted securitized assets $ 3,953.9 $ 4,659.4 $ 4,379.1 The secured borrowings related to these restricted securitized retail notes are obligations that are payable as the retail notes are liquidated. Repayment of the secured borrowings depends primarily on cash flows generated by the restricted assets. Due to the Company’s short-term credit rating, cash collections from these restricted assets are not required to be placed into a segregated collection account until immediately prior to the time payment is required to the secured creditors. At January 31, 2021, the maximum remaining term of all restricted securitized retail notes was approximately six years. |
Leases
Leases | 3 Months Ended |
Jan. 31, 2021 | |
Leases | |
Leases | (6) Leases The Company leases John Deere equipment and a limited amount of non-Deere equipment to retail customers through sales-type, direct financing, and operating leases. Sales-type and direct financing leases are reported in financing leases on the consolidated balance sheet. Operating leases are reported in equipment on operating leases – net on the consolidated balance sheet. Lease revenues earned by the Company were as follows (in millions of dollars): Three Months Ended January 31, 2021 February 2, 2020 Sales-type and direct financing lease revenues $ 11.8 $ 11.6 Operating lease revenues 246.6 258.5 Variable lease revenues* 5.2 4.8 Total lease revenues $ 263.6 $ 274.9 * The cost of equipment on operating leases by product category was as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Agriculture and turf $ 5,023.7 $ 5,210.4 $ 5,145.3 Construction and forestry 1,518.8 1,595.3 1,784.4 Total 6,542.5 6,805.7 6,929.7 Accumulated depreciation (1,509.9) (1,507.9) (1,404.0) Equipment on operating leases - net $ 5,032.6 $ 5,297.8 $ 5,525.7 Operating lease assets are recorded at cost and depreciated to their estimated residual value on a straight-line method over the terms of the leases. The Company reviews residual value estimates during the lease term and tests the carrying value of its operating lease assets for impairment when events or circumstances necessitate. The depreciation is adjusted on a straight-line basis over the remaining lease term if residual value estimates decline. There were no impairment losses on operating leases recorded during the three months ended January 31, 2021 or February 2, 2020. The total operating lease residual values at January 31, 2021, November 1, 2020, and February 2, 2020 were $3,706.8 million, $3,826.3 million, and $3,892.4 million, respectively. Certain operating leases are subject to residual value guarantees. The total residual value guarantees were $162.5 million, $141.0 million, and $60.7 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. The increase in residual value guarantees is primarily due to guarantees provided by John Deere dealers, which generally provide a first-loss residual value guarantee on operating lease originations effective January 2020. The Company discusses with lessees and dealers options to purchase the equipment or extend the lease prior to operating lease maturity. Equipment returned to the Company upon termination of leases is remarketed by the Company. The matured operating lease inventory balances at January 31, 2021, November 1, 2020, and February 2, 2020 were $72.6 million, $64.5 million, and $127.4 million, respectively. Matured operating lease inventory is reported in other assets on the consolidated balance sheet. Due to the economic effects of COVID, the Company provided short-term relief to lessees during 2020, and to a much lesser extent in 2021. The relief was provided in regional programs and on a case-by-case basis with customers that were generally current in their payment obligations. The operating leases granted relief represented approximately 3 percent of the Company’s operating lease portfolio at January 31, 2021. |
Notes Receivable from John Deer
Notes Receivable from John Deere | 3 Months Ended |
Jan. 31, 2021 | |
Notes Receivable from John Deere | |
Notes Receivable from John Deere | (7) Notes Receivable from John Deere The Company makes loans to affiliated companies. The Company receives interest from John Deere at competitive market interest rates. The lending agreements mature over the next seven years. Interest earned from John Deere was $3.3 million in the first three months of 2021, compared with $4.4 million for the same period last year. The Company had notes receivable from John Deere with the following affiliated companies as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Limited Liability Company John Deere Financial $ 89.4 $ 132.5 $ 115.3 Banco John Deere S.A. 210.6 217.5 167.2 Total Notes Receivable from John Deere $ 300.0 $ 350.0 $ 282.5 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Jan. 31, 2021 | |
Commitments and Contingencies | |
Commitments and Contingencies | (8) Commitments and Contingencies At January 31, 2021, John Deere Financial Inc., the John Deere finance subsidiary in Canada, had $1,987.8 million of medium-term notes outstanding, and a fair value liability of $56.5 million for derivatives outstanding, prior to considering applicable netting provisions, with a notional amount of $3,367.6 million that were guaranteed by Capital Corporation. The weighted average interest rate on the medium-term notes at January 31, 2021 was 2.4 percent with a maximum remaining maturity of approximately seven years. Capital Corporation has a variable interest in John Deere Canada Funding Inc. (JDCFI), a wholly-owned subsidiary of John Deere Financial Inc., which was created as a VIE to issue debt in public markets to fund the operations of affiliated companies in Canada. Capital Corporation has a variable interest in JDCFI because it provides guarantees for all debt issued by JDCFI, however it does not consolidate JDCFI because it does not have the power to direct the activities that most significantly impact JDCFI’s economic performance. Capital Corporation has no carrying value of assets or liabilities related to JDCFI. Its maximum exposure to loss is the amount of the debt issued by JDCFI and guaranteed by Capital Corporation, which was $1,130.3 million at January 31, 2021. The weighted average interest rate on the debt at January 31, 2021 was 2.5 percent with a maximum remaining maturity of approximately three years. No additional support beyond what was previously contractually required has been provided to JDCFI during the reporting periods. The Company has commitments to extend credit to customers and John Deere dealers through lines of credit and other pre-approved credit arrangements. The Company applies the same credit policies and approval process for these commitments to extend credit as it does for its Receivables. Collateral is not required for these commitments, but if credit is extended, collateral may be required upon funding. The amount of unused commitments to extend credit to John Deere dealers was $9.6 billion at January 31, 2021. The amount of unused commitments to extend credit to customers was $29.2 billion at January 31, 2021. A significant portion of these commitments is not expected to be fully drawn upon; therefore, the total commitment amounts likely do not represent a future cash requirement. The Company generally has the right to unconditionally cancel, alter, or amend the terms of these commitments at any time. Over 95 percent of the unused commitments to extend credit to customers relate to revolving charge accounts. At January 31, 2021, Capital Corporation had $227.6 million in unused loan commitments, which are unconditionally cancellable, denominated in rubles to Limited Liability Company John Deere Financial, the John Deere finance subsidiary in Russia. At January 31, 2021, the Company had restricted other assets associated with borrowings related to securitizations (see Note 5). Excluding the securitization programs, the remaining balance of restricted other assets was not material as of January 31, 2021. The Company is subject to various unresolved legal actions which arise in the normal course of its business, the most prevalent of which relate to retail credit matters. The Company believes the reasonably possible range of losses for these unresolved legal actions would not have a material effect on its consolidated financial statements. |
Income Taxes
Income Taxes | 3 Months Ended |
Jan. 31, 2021 | |
Income Taxes | |
Income Taxes | (9) Income Taxes The Company’s unrecognized tax benefits at January 31, 2021 were $27.7 million, compared to $33.3 million at November 1, 2020. The liability at January 31, 2021, November 1, 2020, and February 2, 2020 consisted of approximately $16.6 million, $17.2 million, and $14.6 million, respectively, which would affect the effective tax rate if the tax benefits were recognized. The remaining liability was related to tax positions for which there are offsetting tax receivables, or the uncertainty was only related to timing. The Company expects that any reasonably possible change in the amounts of unrecognized tax benefits in the next 12 months would not be material. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Jan. 31, 2021 | |
Fair Value Measurements | |
Fair Value Measurements | (10) Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To determine fair value, the Company uses various methods including market and income approaches. The Company utilizes valuation models and techniques that maximize the use of observable inputs. The models are industry-standard models that consider various assumptions including time values and yield curves as well as other economic measures. These valuation techniques are consistently applied. Level 1 measurements consist of quoted prices in active markets for identical assets or liabilities. Level 2 measurements include significant other observable inputs such as quoted prices for similar assets or liabilities in active markets; identical assets or liabilities in inactive markets; observable inputs such as interest rates and yield curves; and other market-corroborated inputs. Level 3 measurements include significant unobservable inputs. The fair values of financial instruments that do not approximate the carrying values were as follows (in millions of dollars): January 31, 2021 November 1, 2020 February 2, 2020 Carrying Fair Carrying Fair Carrying Fair Value Value * Value Value * Value Value * Receivables financed – net $ 29,426.5 $ 29,666.0 $ 28,751.6 $ 28,931.7 $ 27,184.0 $ 27,221.8 Retail notes securitized – net 3,913.3 4,001.7 4,676.6 4,772.9 4,435.8 4,463.9 Securitization borrowings 3,951.5 3,985.8 4,656.2 4,697.6 4,373.9 4,403.3 Current maturities of long-term borrowings 5,686.8 5,752.7 5,741.6 5,801.1 5,577.6 5,597.5 Long-term borrowings 19,497.5 19,992.3 19,311.1 19,784.4 20,861.9 21,236.0 * Fair value measurements above were Level 3 for all Receivables and Level 2 for all borrowings. Fair values of Receivables that were issued long-term were based on the discounted values of their related cash flows at interest rates currently being offered by the Company for similar Receivables. The fair values of the remaining Receivables approximated the carrying amounts. Fair values of long-term borrowings and short-term securitization borrowings were based on current market quotes for identical or similar borrowings and credit risk, or on the discounted values of their related cash flows at current market interest rates. Certain long-term borrowings have been swapped to current variable interest rates. The carrying values of these long-term borrowings include adjustments related to fair value hedges. Assets and liabilities measured at fair value as Level 2 measurements on a recurring basis were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Marketable securities International debt securities $ 2.2 $ 2.2 $ 2.3 Receivables from John Deere Derivatives: Interest rate contracts 484.3 575.5 408.3 Cross-currency interest rate contracts 3.4 7.7 .4 Other assets Derivatives: Foreign exchange contracts 1.2 3.8 13.4 Total assets * $ 491.1 $ 589.2 $ 424.4 Other payables to John Deere Derivatives: Interest rate contracts $ 42.1 $ 29.4 $ 33.1 Cross-currency interest rate contracts 1.8 .7 3.5 Accounts payable and accrued expenses Derivatives: Foreign exchange contracts 3.0 .9 2.1 Total liabilities $ 46.9 $ 31.0 $ 38.7 * Excluded from this table are the Company’s cash equivalents, which were carried at cost that approximates fair value. The cash equivalents consist primarily of time deposits and money market funds. The international debt securities mature over the next ten years. At January 31, 2021, the amortized cost basis and fair value of these available-for-sale debt securities were $4.7 million and $2.2 million, respectively. Fair value, nonrecurring Level 3 measurements from impairments were as follows (in millions of dollars): Fair Value * Losses Three Months Ended January 31 November 1 February 2 January 31 February 2 2021 2020 2020 2021 2020 Equipment on operating leases – net $ 340.3 Other assets 56.5 Total $ 396.8 * Receivables with specific allowances were not significant. The following is a description of the valuation methodologies the Company uses to measure certain financial instruments on the consolidated balance sheet at fair value: Marketable securities Derivatives – Receivables – Equipment on operating leases - net Other assets |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Jan. 31, 2021 | |
Derivative Instruments | |
Derivative Instruments | (11) Derivative Instruments It is the Company’s policy that derivative transactions are executed only to manage exposures arising in the normal course of business and not for the purpose of creating speculative positions or trading. The Company manages the relationship of the types and amounts of its funding sources to its Receivable and Lease portfolios in an effort to diminish risk due to interest rate and foreign currency fluctuations, while responding to favorable financing opportunities. The Company also has foreign currency exposures at some of its foreign and domestic operations related to financing in currencies other than the functional currencies. All derivatives are recorded at fair value on the consolidated balance sheet. Cash collateral received or paid is not offset against the derivative fair values on the consolidated balance sheet. Each derivative is designated as a cash flow hedge, a fair value hedge, or remains undesignated. All designated hedges are formally documented as to the relationship with the hedged item as well as the risk-management strategy. Both at inception and on an ongoing basis the hedging instrument is assessed as to its effectiveness. If and when a derivative is determined not to be highly effective as a hedge, the underlying hedged transaction is no longer likely to occur, the hedge designation is removed, or the derivative is terminated, hedge accounting is discontinued. Cash Flow Hedges Certain interest rate contracts (swaps) were designated as hedges of future cash flows from borrowings. The total notional amounts of the receive-variable/pay-fixed interest rate contracts at January 31, 2021, November 1, 2020, and February 2, 2020 were $2,350.0 million, $1,550.0 million, and $2,900.0 million, respectively. Fair value gains or losses on these cash flow hedges were recorded in other comprehensive income (OCI) and subsequently reclassified into interest expense in the same periods during which the hedged transactions impact earnings. These amounts offset the effects of interest rate changes on the related borrowings. The cash flows from these contracts were recorded in operating activities in the statement of consolidated cash flows. The amount of loss recorded in OCI at January 31, 2021 that is expected to be reclassified to interest expense in the next twelve months if interest rates remain unchanged is approximately $3.6 million after-tax. No gains or losses were reclassified from OCI to earnings based on the probability that the original forecasted transaction would not occur. Fair Value Hedges Certain interest rate contracts (swaps) were designated as fair value hedges of borrowings. The total notional amounts of the receive-fixed/pay-variable interest rate contracts at January 31, 2021, November 1, 2020, and February 2, 2020 were $7,592.0 million, $6,525.7 million, and $8,743.0 million, respectively. The fair value gains or losses on these contracts were generally offset by fair value gains or losses on the hedged items (fixed-rate borrowings) with both items recorded in interest expense. The amounts recorded in the consolidated balance sheet related to borrowings designated in fair value hedging relationships were as follows (in millions of dollars): Cumulative Increase (Decrease) of Fair Value Hedging Adjustments Included in the Carrying Amount Carrying Active Amount of Hedging Discontinued January 31, 2021 Hedged Item Relationships Relationships Total Current maturities of long-term borrowings $ 1.3 $ 1.3 $ 1.3 Long-term borrowings 8,120.1 $ 423.8 137.3 561.1 November 1, 2020 Current maturities of long-term borrowings $ 2.5 $ 2.5 $ 2.5 Long-term borrowings 7,149.8 $ 530.0 121.6 651.6 February 2, 2020 Current maturities of long-term borrowings $ (5.2) $ (5.2) $ (5.2) Long-term borrowings 9,061.3 $ 372.6 (21.0) 351.6 Derivatives Not designated as Hedging Instruments The Company has certain interest rate contracts (swaps and caps), foreign exchange contracts (futures, forwards, and swaps), and cross-currency interest rate contracts (swaps), which were not formally designated as hedges. These derivatives were held as economic hedges for underlying interest rate or foreign currency exposures primarily for certain borrowings. The total notional amounts of the interest rate swaps at January 31, 2021, November 1, 2020, and February 2, 2020 were $2,527.7 million, $2,336.6 million, and $2,342.2 million, the foreign exchange contracts were $113.0 million, $172.6 million, and $1,365.1 million, and the cross-currency interest rate contracts were $144.7 million, $111.5 million, and $100.0 million, respectively. To facilitate borrowings through securitization of retail notes, interest rate caps were sold with notional amounts of $1,743.9 million, $1,961.4 million, and $1,963.2 million at January 31, 2021, November 1, 2020, and February 2, 2020, respectively. Interest rate caps were also purchased with notional amounts of $1,743.9 million, $1,961.4 million, and $1,963.2 million at the same dates. The fair value gains or losses from the interest rate contracts were recognized currently in interest expense and the gains or losses from foreign exchange contracts in administrative and operating expenses, generally offsetting over time the expenses on the exposures being hedged. The cash flows from these non-designated contracts were recorded in operating activities in the statement of consolidated cash flows. Fair values of derivative instruments in the consolidated balance sheet were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Receivables from John Deere Designated as hedging instruments: Interest rate contracts $ 474.3 $ 565.2 $ 402.0 Not designated as hedging instruments: Interest rate contracts 10.0 10.3 6.3 Cross-currency interest rate contracts 3.4 7.7 .4 Total not designated 13.4 18.0 6.7 Other Assets Not designated as hedging instruments: Foreign exchange contracts 1.2 3.8 13.4 Total not designated 1.2 3.8 13.4 Total derivative assets $ 488.9 $ 587.0 $ 422.1 Other Payables to John Deere Designated as hedging instruments: Interest rate contracts $ 27.7 $ 12.7 $ 16.5 Not designated as hedging instruments: Interest rate contracts 14.4 16.7 16.6 Cross-currency interest rate contracts 1.8 .7 3.5 Total not designated 16.2 17.4 20.1 Accounts Payable and Accrued Expenses Not designated as hedging instruments: Foreign exchange contracts 3.0 .9 2.1 Total derivative liabilities $ 46.9 $ 31.0 $ 38.7 The classification and gains (losses) including accrued interest expense related to derivative instruments on the statement of consolidated income consisted of the following (in millions of dollars): Three Months Ended January 31 February 2 2021 2020 Fair Value Hedges Interest rate contracts - Interest expense $ (52.3) $ 91.1 Cash Flow Hedges Recognized in OCI Interest rate contracts - OCI (pretax) (.5) (1.6) Reclassified from OCI Interest rate contracts - Interest expense (4.3) (1.2) Not Designated as Hedges Interest rate contracts - Interest expense * $ (2.5) $ 2.0 Foreign exchange contracts - Administrative and operating expenses * (12.6) 3.7 Total not designated $ (15.1) $ 5.7 * Includes interest and foreign exchange gains (losses) from cross-currency interest rate contracts. Included in the table above are interest expense and administrative and operating expense amounts the Company incurred on derivatives transacted with John Deere. The amounts the Company recognized on these affiliate party transactions for the three months ended January 31, 2021 and February 2, 2020 were a loss of $63.8 million and a gain of $89.8 million, respectively. Counterparty Risk and Collateral Derivative instruments are subject to significant concentrations of credit risk to the banking sector. The Company manages individual unrelated external counterparty exposure by setting limits that consider the credit rating of the unrelated external counterparty, the credit default swap spread of the counterparty, and other financial commitments and exposures between the Company and the unrelated external counterparty banks. All interest rate derivatives are transacted under International Swaps and Derivatives Association (ISDA) documentation. Each master agreement executed with an unrelated external counterparty permits the net settlement of amounts owed in the event of default or termination. The Company’s outstanding derivatives have been transacted with both unrelated external counterparties and with John Deere. For derivatives transacted with John Deere, the Company utilizes a centralized hedging structure in which John Deere enters into a derivative transaction with an unrelated external counterparty and simultaneously enters into a derivative transaction with the Company. Except for collateral provisions, the terms of the transaction between the Company and John Deere are identical to the terms of the transaction between John Deere and its unrelated external counterparty. Certain of the Company’s derivative agreements executed directly with unrelated external counterparties contain credit support provisions that may require the Company to post collateral based on the size of the net liability positions and credit ratings. At January 31, 2021, November 1, 2020, and February 2, 2020, there were no aggregate liability positions for derivatives with credit-risk-related contingent features. In accordance with these agreements, no collateral was posted at January 31, 2021, November 1, 2020, or February 2, 2020. In addition, the Company paid $2.6 million of collateral either in cash or pledged securities that was outstanding at both January 31, 2021 and November 1, 2020 to participate in an international futures market to hedge currency exposure, which is not included in the table on the subsequent page. The Company also has ISDA agreements with John Deere that permit the net settlement of amounts owed between counterparties in the event of early termination. In addition, the Company has a loss sharing agreement with John Deere in which it has agreed to absorb any losses and expenses John Deere incurs if an unrelated external counterparty fails to meet its obligations on a derivative transaction that John Deere entered into to manage exposures of the Company. The loss sharing agreement did not increase the maximum amount of loss that the Company would incur, after considering collateral received and netting arrangements, as of January 31, 2021, November 1, 2020, and February 2, 2020. Derivatives are recorded without offsetting for netting arrangements or collateral. The impact on the derivative assets and liabilities for external derivatives and those with John Deere related to netting arrangements and any collateral received or paid were as follows (in millions of dollars): January 31, 2021 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 1.2 $ 1.2 John Deere 487.7 $ (37.9) 449.8 Liabilities External 3.0 3.0 John Deere 43.9 (37.9) 6.0 November 1, 2020 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 3.8 $ (.7) $ 3.1 John Deere 583.2 (23.5) 559.7 Liabilities External .9 (.7) .2 John Deere 30.1 (23.5) 6.6 February 2, 2020 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 13.4 $ (.9) $ 12.5 John Deere 408.7 (31.6) 377.1 Liabilities External 2.1 (.9) 1.2 John Deere 36.6 (31.6) 5.0 |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 3 Months Ended |
Jan. 31, 2021 | |
Pension and Other Postretirement Benefits | |
Pension and Other Postretirement Benefits | (12) Pension and Other Postretirement Benefits The Company is a participating employer in certain Deere & Company sponsored defined benefit pension plans for employees in the U.S. and certain defined benefit pension plans outside the U.S. These pension plans provide for benefits that are based primarily on years of service and employee compensation. Pension expense is actuarially determined based on the Company’s employees included in the plan. The Company’s pension expense was not significant for the three month periods ending January 31, 2021 and February 2, 2020. The accumulated benefit obligation and plan net assets for the employees of the Company are not determined separately from Deere & Company. The Company provides defined benefit health care and life insurance plans for certain retired employees in the U.S. as a participating employer in Deere & Company’s sponsored plans. Health care and life insurance benefits expense is actuarially determined based on the Company’s employees included in the plans and amounted to $1.6 million for the first three months of 2021, compared with $5.1 million for the same period last year. The decrease from the prior year is primarily due to a $3.3 million curtailment loss in the first three months of 2020 related to voluntary employee-separation programs (see Note 13). Further disclosure for these plans is included in Deere & Company’s Form 10-Q for the quarter ended January 31, 2021. |
Employee-Separation Programs
Employee-Separation Programs | 3 Months Ended |
Jan. 31, 2021 | |
Employee-Separation Programs | |
Employee-Separation Programs | (13) Employee-Separation Programs During the first quarter of 2020, the Company incurred voluntary employee-separation program expenses of $7.7 million, as part of its efforts to create a more efficient organization structure and reduce operating costs. The program provided for cash payments based on years of service. The expenses were recorded primarily in the period in which the employees irrevocably accepted the separation offer. Included in the total pretax expense noted above was a non-cash charge of $3.3 million resulting from a curtailment in certain OPEB plans (see Note 12). The expenses were recorded in administrative and operating expenses |
Organization and Consolidation
Organization and Consolidation (Policies) | 3 Months Ended |
Jan. 31, 2021 | |
Organization and Consolidation | |
Use of Estimates in Financial Statements | The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts and related disclosures. The COVID-19 (COVID) pandemic has resulted in uncertainties in the Company’s business, which may result in actual outcomes differing from those estimates. |
Fiscal Year | The Company uses a 52/53 week fiscal year with quarters ending on the last Sunday in the reporting period. The first quarter ends for fiscal year 2021 and 2020 were January 31, 2021 and February 2, 2020, respectively. Both periods contained 13 weeks. |
Receivables - Non-Performing, Policy | The Company monitors the credit quality of Receivables based on delinquency status. Past due balances of Receivables still accruing finance income represent the total balance held (principal plus accrued interest) with any payment amounts 30 days or more past the contractual payment due date. Non-performing Receivables represent loans for which the Company has ceased accruing finance income. Generally, when retail notes, revolving charge accounts financing lease |
Allowance for Credit Losses, Policy | The allowance for credit losses is an estimate of the credit losses expected over the life of the Company’s Receivable portfolio. The Company measures expected credit losses on a collective basis when similar risk characteristics exist. Risk characteristics considered by the Company include product category, market, geography, credit risk, and remaining duration. Receivables that do not share risk characteristics with other receivables in the portfolio are evaluated on an individual basis. The Company utilizes loss forecast models, which are selected based on the size and credit risk of the underlying pool of receivables, to estimate expected credit losses. Transition matrix models are used for large and complex Customer Receivable pools, while weighted average remaining maturity (WARM) models are used for smaller and less complex Customer Receivable pools. Transition matrix models, which are used for the majority of the Customer Receivables, estimate credit losses using historical delinquency and default information to assign probabilities that a loan will pay as contractually scheduled or become delinquent and advance through the various delinquency stages. The model simulates the runoff of the portfolio, month-by-month, over the life of the loans until the balances are fully repaid or default, using roll rates applied to the outstanding portfolio. The roll rates are applied based on the delinquency status of the customer accounts and are further segmented based on the credit risk and remaining duration of the underlying receivables. Estimated recovery rates are applied to the balance at default to calculate the expected credit losses. The modeled expected credit losses are adjusted based on reasonable and supportable forecasts, which may include economic indicators such as commodity prices, industry equipment sales, unemployment rates, and housing starts. The WARM models apply historical average annual loss rates, adjusted for current and forecasted economic conditions, to the projected portfolio runoff. Expected credit losses on wholesale receivables are based on historical loss rates, adjusted for current economic conditions and reasonable and supportable forecasts. Management reviews each model’s output quarterly, and qualitative adjustments are incorporated as necessary. |
Troubled Debt Restructuring, Policy | A troubled debt restructuring is generally the modification of debt in which a creditor grants a concession it would not otherwise consider to a debtor that is experiencing financial difficulties. These modifications may include a reduction of the stated interest rate, an extension of the maturity dates, a reduction of the face amount or maturity amount of the debt, or a reduction of accrued interest. During the first three months of 2021, the Company identified 95 Receivable contracts, primarily retail notes, as troubled debt restructurings with aggregate balances of $5.5 million pre-modification and $5.4 million post-modification. During the first three months of 2020, there were 73 Receivable contracts, primarily retail notes, with aggregate balances of $2.2 million pre-modification and $2.0 million post-modification. The short-term relief related to COVID mentioned on page 11 did not meet the definition of a troubled debt restructuring. During these same periods, there were no significant troubled debt restructurings that subsequently defaulted and were written off. At January 31, 2021, the Company had no commitments to lend additional funds to borrowers whose accounts were modified in troubled debt restructurings. |
Fair Value of Financial Instruments, Policy | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To determine fair value, the Company uses various methods including market and income approaches. The Company utilizes valuation models and techniques that maximize the use of observable inputs. The models are industry-standard models that consider various assumptions including time values and yield curves as well as other economic measures. These valuation techniques are consistently applied. |
Derivative Financial Instruments | It is the Company’s policy that derivative transactions are executed only to manage exposures arising in the normal course of business and not for the purpose of creating speculative positions or trading. The Company manages the relationship of the types and amounts of its funding sources to its Receivable and Lease portfolios in an effort to diminish risk due to interest rate and foreign currency fluctuations, while responding to favorable financing opportunities. The Company also has foreign currency exposures at some of its foreign and domestic operations related to financing in currencies other than the functional currencies. All derivatives are recorded at fair value on the consolidated balance sheet. Cash collateral received or paid is not offset against the derivative fair values on the consolidated balance sheet. Each derivative is designated as a cash flow hedge, a fair value hedge, or remains undesignated. All designated hedges are formally documented as to the relationship with the hedged item as well as the risk-management strategy. Both at inception and on an ongoing basis the hedging instrument is assessed as to its effectiveness. If and when a derivative is determined not to be highly effective as a hedge, the underlying hedged transaction is no longer likely to occur, the hedge designation is removed, or the derivative is terminated, hedge accounting is discontinued. |
New Accounting Standards (Table
New Accounting Standards (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
New Accounting Standards | |
Schedule of Affected Lines on the Consolidated Balance Sheet from Initially Applying the New Measurement of Credit Losses on Financial Instruments Guidance | The effects of adopting the ASU on the consolidated balance sheet were as follows (in millions of dollars): November 1 Cumulative Effect November 2 2020 from Adoption 2020 Assets Allowance for credit losses $ (129.1) $ (19.7) $ (148.8) Deferred income taxes 27.1 .7 27.8 Liabilities Accounts payable and accrued expenses $ 922.3 $ (.5) $ 921.8 Deposits withheld from dealers and merchants 114.8 13.5 128.3 Deferred income taxes 345.9 (5.8) 340.1 Stockholder’s equity Retained earnings $ 2,891.6 $ (26.2) $ 2,865.4 |
Other Comprehensive Income It_2
Other Comprehensive Income Items (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Other Comprehensive Income Items | |
Schedule of After-Tax Changes in Accumulated Other Comprehensive Income (Loss) | The after-tax changes in accumulated other comprehensive income (loss) were as follows (in millions of dollars): Unrealized Unrealized Accumulated Cumulative Gain (Loss) Gain (Loss) Other Translation on on Comprehensive Adjustment Derivatives Debt Securities Income (Loss) Balance November 3, 2019 $ (88.4) $ (7.0) $ (2.0) $ (97.4) Other comprehensive income (loss) items before reclassification (4.8) (1.2) (.4) (6.4) Amounts reclassified from accumulated other comprehensive income .9 .9 Net current period other comprehensive income (loss) (4.8) (.3) (.4) (5.5) Balance February 2, 2020 $ (93.2) $ (7.3) $ (2.4) $ (102.9) Balance November 1, 2020 $ (69.5) $ (6.7) $ (1.6) $ (77.8) Other comprehensive income (loss) items before reclassification 35.7 (.4) .1 35.4 Amounts reclassified from accumulated other comprehensive income 3.4 3.4 Net current period other comprehensive income (loss) 35.7 3.0 .1 38.8 Balance January 31, 2021 $ (33.8) $ (3.7) $ (1.5) $ (39.0) |
Schedule of Amounts Recorded in and Reclassifications out of Other Comprehensive Income (Loss) and the Income Tax Effects | Amounts recorded in and reclassifications out of other comprehensive income (loss), and the income tax effects were as follows (in millions of dollars): Before Tax After Tax (Expense) Tax Three Months Ended January 31, 2021 Amount Credit Amount Cumulative translation adjustment $ 35.7 $ 35.7 Unrealized gain (loss) on derivatives: Unrealized hedging gain (loss) (.5) $ .1 (.4) Reclassification of realized (gain) loss to: Interest rate contracts – Interest expense 4.3 (.9) 3.4 Net unrealized gain (loss) on derivatives 3.8 (.8) 3.0 Unrealized gain (loss) on debt securities: Unrealized holding gain (loss) .1 .1 Total other comprehensive income (loss) $ 39.6 $ (.8) $ 38.8 Three Months Ended February 2, 2020 Cumulative translation adjustment $ (4.8) $ (4.8) Unrealized gain (loss) on derivatives: Unrealized hedging gain (loss) (1.6) $ .4 (1.2) Reclassification of realized (gain) loss to: Interest rate contracts – Interest expense 1.2 (.3) .9 Net unrealized gain (loss) on derivatives (.4) .1 (.3) Unrealized gain (loss) on debt securities: Unrealized holding gain (loss) (.9) .5 (.4) Total other comprehensive income (loss) $ (6.1) $ .6 $ (5.5) |
Receivables (Tables)
Receivables (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Receivables | |
Analysis of the Allowance for Credit Losses and Investment in Receivables | An analysis of the allowance for credit losses and investment in Receivables during 2021 was as follows (in millions of dollars): Three Months Ended January 31, 2021 Retail Notes Revolving & Financing Charge Wholesale Total Leases Accounts Receivables Receivables Allowance: Beginning of period balance $ 76.9 $ 42.3 $ 9.9 $ 129.1 ASU No. 2016-13 adoption* 32.5 (12.2) (.6) 19.7 Provision (credit) for credit losses** 6.7 (9.7) (3.0) Write-offs (4.1) (5.3) (9.4) Recoveries 2.8 9.2 12.0 Translation adjustments .9 .2 1.1 End of period balance $ 115.7 $ 24.3 $ 9.5 $ 149.5 Receivables: End of period balance $ 23,032.1 $ 2,621.7 $ 7,835.5 $ 33,489.3 * ** |
Customer Receivables | |
Receivables | |
Credit Quality Analysis | The credit quality analysis of retail notes, financing leases, and revolving charge accounts (collectively, Customer Receivables) at January 31, 2021 was as follows (in millions of dollars): Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Charge Accounts Total Customer Receivables: Agriculture and turf Current $ 2,233.8 $ 8,126.9 $ 4,264.4 $ 2,338.4 $ 1,137.2 $ 464.9 $ 2,498.1 $ 21,063.7 30-59 days past due 2.7 50.0 35.1 24.4 10.8 6.0 26.3 155.3 60-89 days past due .1 13.8 11.7 8.4 3.7 2.8 4.2 44.7 90+ days past due .8 .2 .1 .2 1.3 Non-performing .3 34.4 52.5 40.2 21.6 24.0 6.5 179.5 Construction and forestry Current 582.3 1,723.8 974.0 447.5 123.4 30.1 81.8 3,962.9 30-59 days past due 3.7 46.8 27.9 14.5 4.7 1.2 2.9 101.7 60-89 days past due .4 12.8 15.1 6.5 2.1 .6 1.2 38.7 90+ days past due 8.6 4.9 13.5 Non-performing 23.5 28.8 22.4 11.0 6.1 .7 92.5 Total Customer Receivables $ 2,823.3 $ 10,040.6 $ 5,415.2 $ 2,902.5 $ 1,314.6 $ 535.9 $ 2,621.7 $ 25,653.8 |
Age Credit Quality Analysis | Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Charge Accounts Total Customer Receivables: Agriculture and turf Current $ 2,233.8 $ 8,126.9 $ 4,264.4 $ 2,338.4 $ 1,137.2 $ 464.9 $ 2,498.1 $ 21,063.7 30-59 days past due 2.7 50.0 35.1 24.4 10.8 6.0 26.3 155.3 60-89 days past due .1 13.8 11.7 8.4 3.7 2.8 4.2 44.7 90+ days past due .8 .2 .1 .2 1.3 Non-performing .3 34.4 52.5 40.2 21.6 24.0 6.5 179.5 Construction and forestry Current 582.3 1,723.8 974.0 447.5 123.4 30.1 81.8 3,962.9 30-59 days past due 3.7 46.8 27.9 14.5 4.7 1.2 2.9 101.7 60-89 days past due .4 12.8 15.1 6.5 2.1 .6 1.2 38.7 90+ days past due 8.6 4.9 13.5 Non-performing 23.5 28.8 22.4 11.0 6.1 .7 92.5 Total Customer Receivables $ 2,823.3 $ 10,040.6 $ 5,415.2 $ 2,902.5 $ 1,314.6 $ 535.9 $ 2,621.7 $ 25,653.8 |
Wholesale Receivables | |
Receivables | |
Credit Quality Analysis | The credit quality analysis of wholesale receivables at January 31, 2021 was as follows (in millions of dollars): Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Total Wholesale receivables: Agriculture and turf Current $ 78.5 $ 216.5 $ 61.5 $ 17.8 $ 7.5 $ 1.3 $ 6,092.5 $ 6,475.6 30-59 days past due 7.2 7.2 60-89 days past due .2 3.0 3.2 90+ days past due 2.2 2.2 Non-performing 4.1 4.1 Construction and forestry Current 2.6 7.9 5.4 .6 1,323.3 1,339.8 30-59 days past due 3.0 3.0 60-89 days past due .4 .4 90+ days past due Non-performing Total wholesale receivables $ 81.1 $ 224.6 $ 66.9 $ 18.4 $ 7.5 $ 1.3 $ 7,435.7 $ 7,835.5 |
Age Credit Quality Analysis | Year of Origination 2021 2020 2019 2018 2017 Prior Revolving Total Wholesale receivables: Agriculture and turf Current $ 78.5 $ 216.5 $ 61.5 $ 17.8 $ 7.5 $ 1.3 $ 6,092.5 $ 6,475.6 30-59 days past due 7.2 7.2 60-89 days past due .2 3.0 3.2 90+ days past due 2.2 2.2 Non-performing 4.1 4.1 Construction and forestry Current 2.6 7.9 5.4 .6 1,323.3 1,339.8 30-59 days past due 3.0 3.0 60-89 days past due .4 .4 90+ days past due Non-performing Total wholesale receivables $ 81.1 $ 224.6 $ 66.9 $ 18.4 $ 7.5 $ 1.3 $ 7,435.7 $ 7,835.5 |
Securitization of Receivables (
Securitization of Receivables (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Securitization of Receivables | |
Unconsolidated Conduits, Carrying Amount of Liabilities Compared to Maximum Exposure to Loss | The Company’s carrying amount of the liabilities to the unconsolidated conduits, compared to the maximum exposure to loss related to these conduits, which would only be incurred in the event of a complete loss on the restricted assets was as follows (in millions of dollars): January 31 2021 Carrying value of liabilities $ 1,097.0 Maximum exposure to loss 1,120.0 |
Components of Consolidated Restricted Assets, Secured Borrowings and Other Liabilities Related to Securitization Transactions | The components of consolidated restricted assets related to secured borrowings in securitization transactions were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Retail notes securitized $ 3,928.0 $ 4,689.2 $ 4,443.7 Allowance for credit losses (14.7) (12.6) (7.9) Other assets 94.4 97.9 91.4 Total restricted securitized assets $ 4,007.7 $ 4,774.5 $ 4,527.2 The components of consolidated secured borrowings and other liabilities related to securitizations were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Securitization borrowings $ 3,951.5 $ 4,656.2 $ 4,373.9 Accrued interest on borrowings 2.4 3.2 5.2 Total liabilities related to restricted securitized assets $ 3,953.9 $ 4,659.4 $ 4,379.1 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Leases | |
Schedule of Lease Revenues Earned | Lease revenues earned by the Company were as follows (in millions of dollars): Three Months Ended January 31, 2021 February 2, 2020 Sales-type and direct financing lease revenues $ 11.8 $ 11.6 Operating lease revenues 246.6 258.5 Variable lease revenues* 5.2 4.8 Total lease revenues $ 263.6 $ 274.9 * |
Schedule of Cost of Equipment on Operating Leases by Product Category | The cost of equipment on operating leases by product category was as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Agriculture and turf $ 5,023.7 $ 5,210.4 $ 5,145.3 Construction and forestry 1,518.8 1,595.3 1,784.4 Total 6,542.5 6,805.7 6,929.7 Accumulated depreciation (1,509.9) (1,507.9) (1,404.0) Equipment on operating leases - net $ 5,032.6 $ 5,297.8 $ 5,525.7 |
Notes Receivable from John De_2
Notes Receivable from John Deere (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Notes Receivable from John Deere | |
Notes Receivable from John Deere | The Company had notes receivable from John Deere with the following affiliated companies as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Limited Liability Company John Deere Financial $ 89.4 $ 132.5 $ 115.3 Banco John Deere S.A. 210.6 217.5 167.2 Total Notes Receivable from John Deere $ 300.0 $ 350.0 $ 282.5 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Fair Value Measurements | |
Fair Value of Financial Instruments | The fair values of financial instruments that do not approximate the carrying values were as follows (in millions of dollars): January 31, 2021 November 1, 2020 February 2, 2020 Carrying Fair Carrying Fair Carrying Fair Value Value * Value Value * Value Value * Receivables financed – net $ 29,426.5 $ 29,666.0 $ 28,751.6 $ 28,931.7 $ 27,184.0 $ 27,221.8 Retail notes securitized – net 3,913.3 4,001.7 4,676.6 4,772.9 4,435.8 4,463.9 Securitization borrowings 3,951.5 3,985.8 4,656.2 4,697.6 4,373.9 4,403.3 Current maturities of long-term borrowings 5,686.8 5,752.7 5,741.6 5,801.1 5,577.6 5,597.5 Long-term borrowings 19,497.5 19,992.3 19,311.1 19,784.4 20,861.9 21,236.0 * Fair value measurements above were Level 3 for all Receivables and Level 2 for all borrowings. |
Assets and Liabilities Measured at Fair Value as Level 2 Measurements on a Recurring Basis | Assets and liabilities measured at fair value as Level 2 measurements on a recurring basis were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Marketable securities International debt securities $ 2.2 $ 2.2 $ 2.3 Receivables from John Deere Derivatives: Interest rate contracts 484.3 575.5 408.3 Cross-currency interest rate contracts 3.4 7.7 .4 Other assets Derivatives: Foreign exchange contracts 1.2 3.8 13.4 Total assets * $ 491.1 $ 589.2 $ 424.4 Other payables to John Deere Derivatives: Interest rate contracts $ 42.1 $ 29.4 $ 33.1 Cross-currency interest rate contracts 1.8 .7 3.5 Accounts payable and accrued expenses Derivatives: Foreign exchange contracts 3.0 .9 2.1 Total liabilities $ 46.9 $ 31.0 $ 38.7 * Excluded from this table are the Company’s cash equivalents, which were carried at cost that approximates fair value. The cash equivalents consist primarily of time deposits and money market funds. |
Fair Value, Nonrecurring Level 3 Measurements from Impairments | Fair value, nonrecurring Level 3 measurements from impairments were as follows (in millions of dollars): Fair Value * Losses Three Months Ended January 31 November 1 February 2 January 31 February 2 2021 2020 2020 2021 2020 Equipment on operating leases – net $ 340.3 Other assets 56.5 Total $ 396.8 * Receivables with specific allowances were not significant. |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Jan. 31, 2021 | |
Derivative Instruments | |
Amounts Recorded in the Consolidated Balance Sheet Related to Borrowings Designated in Fair Value Hedging Relationships | The amounts recorded in the consolidated balance sheet related to borrowings designated in fair value hedging relationships were as follows (in millions of dollars): Cumulative Increase (Decrease) of Fair Value Hedging Adjustments Included in the Carrying Amount Carrying Active Amount of Hedging Discontinued January 31, 2021 Hedged Item Relationships Relationships Total Current maturities of long-term borrowings $ 1.3 $ 1.3 $ 1.3 Long-term borrowings 8,120.1 $ 423.8 137.3 561.1 November 1, 2020 Current maturities of long-term borrowings $ 2.5 $ 2.5 $ 2.5 Long-term borrowings 7,149.8 $ 530.0 121.6 651.6 February 2, 2020 Current maturities of long-term borrowings $ (5.2) $ (5.2) $ (5.2) Long-term borrowings 9,061.3 $ 372.6 (21.0) 351.6 |
Fair Value of Derivative Instruments in Consolidated Balance Sheet | Fair values of derivative instruments in the consolidated balance sheet were as follows (in millions of dollars): January 31 November 1 February 2 2021 2020 2020 Receivables from John Deere Designated as hedging instruments: Interest rate contracts $ 474.3 $ 565.2 $ 402.0 Not designated as hedging instruments: Interest rate contracts 10.0 10.3 6.3 Cross-currency interest rate contracts 3.4 7.7 .4 Total not designated 13.4 18.0 6.7 Other Assets Not designated as hedging instruments: Foreign exchange contracts 1.2 3.8 13.4 Total not designated 1.2 3.8 13.4 Total derivative assets $ 488.9 $ 587.0 $ 422.1 Other Payables to John Deere Designated as hedging instruments: Interest rate contracts $ 27.7 $ 12.7 $ 16.5 Not designated as hedging instruments: Interest rate contracts 14.4 16.7 16.6 Cross-currency interest rate contracts 1.8 .7 3.5 Total not designated 16.2 17.4 20.1 Accounts Payable and Accrued Expenses Not designated as hedging instruments: Foreign exchange contracts 3.0 .9 2.1 Total derivative liabilities $ 46.9 $ 31.0 $ 38.7 |
Gains (Losses) Related to Derivative Instruments on Statement of Consolidated Income | The classification and gains (losses) including accrued interest expense related to derivative instruments on the statement of consolidated income consisted of the following (in millions of dollars): Three Months Ended January 31 February 2 2021 2020 Fair Value Hedges Interest rate contracts - Interest expense $ (52.3) $ 91.1 Cash Flow Hedges Recognized in OCI Interest rate contracts - OCI (pretax) (.5) (1.6) Reclassified from OCI Interest rate contracts - Interest expense (4.3) (1.2) Not Designated as Hedges Interest rate contracts - Interest expense * $ (2.5) $ 2.0 Foreign exchange contracts - Administrative and operating expenses * (12.6) 3.7 Total not designated $ (15.1) $ 5.7 * Includes interest and foreign exchange gains (losses) from cross-currency interest rate contracts. |
Impact on Derivative Assets and Liabilities for External Derivatives and those with John Deere Related to Netting Arrangements and Collateral | Derivatives are recorded without offsetting for netting arrangements or collateral. The impact on the derivative assets and liabilities for external derivatives and those with John Deere related to netting arrangements and any collateral received or paid were as follows (in millions of dollars): January 31, 2021 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 1.2 $ 1.2 John Deere 487.7 $ (37.9) 449.8 Liabilities External 3.0 3.0 John Deere 43.9 (37.9) 6.0 November 1, 2020 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 3.8 $ (.7) $ 3.1 John Deere 583.2 (23.5) 559.7 Liabilities External .9 (.7) .2 John Deere 30.1 (23.5) 6.6 February 2, 2020 Derivatives: Gross Amounts Netting Collateral Net Assets External $ 13.4 $ (.9) $ 12.5 John Deere 408.7 (31.6) 377.1 Liabilities External 2.1 (.9) 1.2 John Deere 36.6 (31.6) 5.0 |
Organization and Consolidatio_2
Organization and Consolidation (Details) | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Organization and Consolidation | ||
Fiscal period duration | 91 days | 91 days |
New Accounting Standards (Detai
New Accounting Standards (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Jan. 31, 2021 | Nov. 02, 2020 | Nov. 01, 2020 | Feb. 02, 2020 | Nov. 03, 2019 | |
Assets | |||||
Allowance for credit losses | $ (149.5) | $ (148.8) | $ (129.1) | $ (103.1) | $ (100.6) |
Deferred income taxes | 31.1 | 27.8 | 27.1 | 34 | |
Liabilities | |||||
Accounts payable and accrued expenses | 805.2 | 921.8 | 922.3 | 857.5 | |
Deposits withheld from dealers and merchants | 126.9 | 128.3 | 114.8 | 128.5 | |
Deferred income taxes | 330.1 | 340.1 | 345.9 | 503.8 | |
Retained earnings | $ 2,897.1 | $ 2,865.4 | 2,891.6 | $ 2,715.8 | |
ASU 2016-13 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||
Change in Accounting Principle, Accounting Standards Update, Transition Option Elected [Fixed List] | jdcc:AccountingStandardsUpdate201613CumulativeEffectPeriodOfAdoptionMember | ||||
ASU 2016-13 | Cumulative Effect from Adoption | |||||
Assets | |||||
Allowance for credit losses | (19.7) | ||||
Deferred income taxes | 0.7 | ||||
Liabilities | |||||
Accounts payable and accrued expenses | (0.5) | ||||
Deposits withheld from dealers and merchants | 13.5 | ||||
Deferred income taxes | (5.8) | ||||
Retained earnings | $ (26.2) | ||||
ASU 2018-15 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||
ASU 2019-04 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||
ASU 2021-01 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||
ASU 2019-12 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | false | ||||
ASU 2020-08 | |||||
New accounting standards | |||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | false |
Other Comprehensive Income It_3
Other Comprehensive Income Items - After-Tax Changes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
After-tax changes in accumulated other comprehensive income (loss) | ||
Balance | $ 4,296.6 | |
Net current period other comprehensive income (loss) | 38.8 | $ (5.5) |
Balance | 4,340.9 | 4,095.7 |
Accumulated Other Comprehensive Income (Loss) | ||
After-tax changes in accumulated other comprehensive income (loss) | ||
Balance | (77.8) | (97.4) |
Other comprehensive income (loss) items before reclassification | 35.4 | (6.4) |
Amounts reclassified from accumulated other comprehensive income | 3.4 | 0.9 |
Net current period other comprehensive income (loss) | 38.8 | (5.5) |
Balance | (39) | (102.9) |
Cumulative Translation Adjustment | ||
After-tax changes in accumulated other comprehensive income (loss) | ||
Balance | (69.5) | (88.4) |
Other comprehensive income (loss) items before reclassification | 35.7 | (4.8) |
Net current period other comprehensive income (loss) | 35.7 | (4.8) |
Balance | (33.8) | (93.2) |
Unrealized Gain (Loss) on Derivatives | ||
After-tax changes in accumulated other comprehensive income (loss) | ||
Balance | (6.7) | (7) |
Other comprehensive income (loss) items before reclassification | (0.4) | (1.2) |
Amounts reclassified from accumulated other comprehensive income | 3.4 | 0.9 |
Net current period other comprehensive income (loss) | 3 | (0.3) |
Balance | (3.7) | (7.3) |
Unrealized Gain (Loss) on Debt Securities | ||
After-tax changes in accumulated other comprehensive income (loss) | ||
Balance | (1.6) | (2) |
Other comprehensive income (loss) items before reclassification | 0.1 | (0.4) |
Net current period other comprehensive income (loss) | 0.1 | (0.4) |
Balance | $ (1.5) | $ (2.4) |
Other Comprehensive Income It_4
Other Comprehensive Income Items - Amounts Recorded in and Reclassifications out of (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Other comprehensive income (loss), before tax | ||
Interest expense | $ (134) | $ (219.8) |
Administrative and operating expenses | (92.5) | (123.5) |
Total other comprehensive income (loss), before tax | 39.6 | (6.1) |
Other comprehensive income (loss), tax (expense) credit | ||
Total other comprehensive income (loss), tax (expense) credit | (0.8) | 0.6 |
Other comprehensive income (loss), after tax | ||
Other comprehensive income (loss), net of income taxes | 38.8 | (5.5) |
Cumulative Translation Adjustment | ||
Other comprehensive income (loss), before tax | ||
Total other comprehensive income (loss), before tax | 35.7 | (4.8) |
Other comprehensive income (loss), after tax | ||
Other comprehensive income (loss), net of income taxes | 35.7 | (4.8) |
Unrealized Gain (Loss) on Derivatives | ||
Other comprehensive income (loss), before tax | ||
Other comprehensive income (loss) before reclassification, before tax | (0.5) | (1.6) |
Total other comprehensive income (loss), before tax | 3.8 | (0.4) |
Other comprehensive income (loss), tax (expense) credit | ||
Other comprehensive income (loss) before reclassification, tax (expense) credit | 0.1 | 0.4 |
Total other comprehensive income (loss), tax (expense) credit | (0.8) | 0.1 |
Other comprehensive income (loss), after tax | ||
Other comprehensive income (loss) before reclassification, after tax | (0.4) | (1.2) |
Other comprehensive income (loss), net of income taxes | 3 | (0.3) |
Unrealized Gain (Loss) on Derivatives | Interest rate contracts | Reclassifications of gains (losses) out of accumulated other comprehensive income | ||
Other comprehensive income (loss), before tax | ||
Interest expense | 4.3 | 1.2 |
Other comprehensive income (loss), tax (expense) credit | ||
Reclassification of realized (gain) loss, tax expense (credit) | (0.9) | (0.3) |
Other comprehensive income (loss), after tax | ||
Reclassification of realized (gain) loss, after tax | 3.4 | 0.9 |
Unrealized Gain (Loss) on Debt Securities | ||
Other comprehensive income (loss), before tax | ||
Other comprehensive income (loss) before reclassification, before tax | 0.1 | |
Total other comprehensive income (loss), before tax | (0.9) | |
Other comprehensive income (loss), tax (expense) credit | ||
Total other comprehensive income (loss), tax (expense) credit | 0.5 | |
Other comprehensive income (loss), after tax | ||
Other comprehensive income (loss) before reclassification, after tax | $ 0.1 | |
Other comprehensive income (loss), net of income taxes | $ (0.4) |
Receivables - Financing Receiva
Receivables - Financing Receivables Past Due (Details) | 3 Months Ended |
Jan. 31, 2021 | |
Receivable, Past Due | |
Minimum number of days for a receivable to be considered past due | 30 days |
COVID-19 | |
Receivable, Past Due | |
Percentage of financing receivables granted relief (as a percent) | 4.00% |
Retail notes | |
Receivable, Past Due | |
Generally the number of days for a financing receivable to be considered non-performing | 90 days |
Generally the number of days before a receivable is delinquent and the estimated uncollectible amount is written off | 120 days |
Revolving charge accounts | |
Receivable, Past Due | |
Generally the number of days for a financing receivable to be considered non-performing | 90 days |
Generally the number of days before a receivable is delinquent and the estimated uncollectible amount is written off | 120 days |
Wholesale Receivables | |
Receivable, Past Due | |
Generally the number of days for a financing receivable to be considered non-performing | 60 days |
Generally the number of days before a receivable is delinquent and the estimated uncollectible amount is written off | 60 days |
Financing Leases | |
Receivable, Past Due | |
Generally the number of days for a financing receivable to be considered non-performing | 90 days |
Generally the number of days before a receivable is delinquent and the estimated uncollectible amount is written off | 120 days |
Receivables - Customer Receivab
Receivables - Customer Receivables Credit Quality Analysis (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Credit Quality Analysis | |||
Total Receivables | $ 33,489.3 | $ 33,557.3 | $ 31,722.9 |
Customer Receivables | |||
Credit Quality Analysis | |||
2021 | 2,823.3 | ||
2020 | 10,040.6 | ||
2019 | 5,415.2 | ||
2018 | 2,902.5 | ||
2017 | 1,314.6 | ||
Prior | 535.9 | ||
Revolving | 2,621.7 | ||
Total Receivables | 25,653.8 | $ 26,464 | $ 22,576.6 |
Customer Receivables | Agriculture and turf | 30-59 Days Past Due | |||
Credit Quality Analysis | |||
2021 | 2.7 | ||
2020 | 50 | ||
2019 | 35.1 | ||
2018 | 24.4 | ||
2017 | 10.8 | ||
Prior | 6 | ||
Revolving | 26.3 | ||
Total Receivables | 155.3 | ||
Customer Receivables | Agriculture and turf | 60-89 Days Past Due | |||
Credit Quality Analysis | |||
2021 | 0.1 | ||
2020 | 13.8 | ||
2019 | 11.7 | ||
2018 | 8.4 | ||
2017 | 3.7 | ||
Prior | 2.8 | ||
Revolving | 4.2 | ||
Total Receivables | 44.7 | ||
Customer Receivables | Agriculture and turf | 90 Days or Greater Past Due | |||
Credit Quality Analysis | |||
2019 | 0.8 | ||
2018 | 0.2 | ||
2017 | 0.1 | ||
Prior | 0.2 | ||
Total Receivables | 1.3 | ||
Customer Receivables | Agriculture and turf | Current | |||
Credit Quality Analysis | |||
2021 | 2,233.8 | ||
2020 | 8,126.9 | ||
2019 | 4,264.4 | ||
2018 | 2,338.4 | ||
2017 | 1,137.2 | ||
Prior | 464.9 | ||
Revolving | 2,498.1 | ||
Total Receivables | 21,063.7 | ||
Customer Receivables | Agriculture and turf | Non-performing | |||
Credit Quality Analysis | |||
2021 | 0.3 | ||
2020 | 34.4 | ||
2019 | 52.5 | ||
2018 | 40.2 | ||
2017 | 21.6 | ||
Prior | 24 | ||
Revolving | 6.5 | ||
Total Receivables | 179.5 | ||
Customer Receivables | Construction and forestry | 30-59 Days Past Due | |||
Credit Quality Analysis | |||
2021 | 3.7 | ||
2020 | 46.8 | ||
2019 | 27.9 | ||
2018 | 14.5 | ||
2017 | 4.7 | ||
Prior | 1.2 | ||
Revolving | 2.9 | ||
Total Receivables | 101.7 | ||
Customer Receivables | Construction and forestry | 60-89 Days Past Due | |||
Credit Quality Analysis | |||
2021 | 0.4 | ||
2020 | 12.8 | ||
2019 | 15.1 | ||
2018 | 6.5 | ||
2017 | 2.1 | ||
Prior | 0.6 | ||
Revolving | 1.2 | ||
Total Receivables | 38.7 | ||
Customer Receivables | Construction and forestry | 90 Days or Greater Past Due | |||
Credit Quality Analysis | |||
2020 | 8.6 | ||
2019 | 4.9 | ||
Total Receivables | 13.5 | ||
Customer Receivables | Construction and forestry | Current | |||
Credit Quality Analysis | |||
2021 | 582.3 | ||
2020 | 1,723.8 | ||
2019 | 974 | ||
2018 | 447.5 | ||
2017 | 123.4 | ||
Prior | 30.1 | ||
Revolving | 81.8 | ||
Total Receivables | 3,962.9 | ||
Customer Receivables | Construction and forestry | Non-performing | |||
Credit Quality Analysis | |||
2020 | 23.5 | ||
2019 | 28.8 | ||
2018 | 22.4 | ||
2017 | 11 | ||
Prior | 6.1 | ||
Revolving | 0.7 | ||
Total Receivables | $ 92.5 |
Receivables - Customer Receiv_2
Receivables - Customer Receivables Age Credit Quality Analysis (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Age Credit Quality Analysis | |||
Total Receivables | $ 33,489.3 | $ 33,557.3 | $ 31,722.9 |
Customer Receivables | |||
Age Credit Quality Analysis | |||
Total Receivables | 25,653.8 | 26,464 | 22,576.6 |
Customer Receivables | Agriculture and turf | |||
Age Credit Quality Analysis | |||
Current | 22,051.5 | 18,476.7 | |
Non-performing | 178.1 | 205.2 | |
Customer Receivables | Agriculture and turf | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 122.9 | 183.3 | |
Total Receivables | 155.3 | ||
Customer Receivables | Agriculture and turf | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 51.1 | 71.3 | |
Total Receivables | 44.7 | ||
Customer Receivables | Agriculture and turf | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | 2 | 3.4 | |
Total Receivables | 1.3 | ||
Customer Receivables | Construction and forestry | |||
Age Credit Quality Analysis | |||
Current | 3,851.8 | 3,388.9 | |
Non-performing | 80.4 | 114.8 | |
Customer Receivables | Construction and forestry | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 84.4 | 95.1 | |
Total Receivables | 101.7 | ||
Customer Receivables | Construction and forestry | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 39.9 | 37.9 | |
Total Receivables | 38.7 | ||
Customer Receivables | Construction and forestry | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | 1.9 | ||
Total Receivables | 13.5 | ||
Retail Notes and Financing Leases | |||
Age Credit Quality Analysis | |||
Total Receivables | 23,032.1 | 22,636.6 | 19,903.4 |
Retail Notes and Financing Leases | Agriculture and turf | |||
Age Credit Quality Analysis | |||
Current | 18,341.2 | 15,959.9 | |
Non-performing | 172.7 | 199.6 | |
Retail Notes and Financing Leases | Agriculture and turf | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 111.4 | 131.9 | |
Retail Notes and Financing Leases | Agriculture and turf | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 47.6 | 57.2 | |
Retail Notes and Financing Leases | Agriculture and turf | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | 2 | 3.4 | |
Retail Notes and Financing Leases | Construction and forestry | |||
Age Credit Quality Analysis | |||
Current | 3,759.5 | 3,310.1 | |
Non-performing | 79.5 | 113.8 | |
Retail Notes and Financing Leases | Construction and forestry | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 82 | 91 | |
Retail Notes and Financing Leases | Construction and forestry | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 38.8 | 36.5 | |
Retail Notes and Financing Leases | Construction and forestry | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | 1.9 | ||
Revolving charge accounts | |||
Age Credit Quality Analysis | |||
Total Receivables | $ 2,621.7 | 3,827.4 | 2,673.2 |
Revolving charge accounts | Agriculture and turf | |||
Age Credit Quality Analysis | |||
Current | 3,710.3 | 2,516.8 | |
Non-performing | 5.4 | 5.6 | |
Revolving charge accounts | Agriculture and turf | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 11.5 | 51.4 | |
Revolving charge accounts | Agriculture and turf | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 3.5 | 14.1 | |
Revolving charge accounts | Construction and forestry | |||
Age Credit Quality Analysis | |||
Current | 92.3 | 78.8 | |
Non-performing | 0.9 | 1 | |
Revolving charge accounts | Construction and forestry | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 2.4 | 4.1 | |
Revolving charge accounts | Construction and forestry | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | $ 1.1 | $ 1.4 |
Receivables - Wholesale Receiva
Receivables - Wholesale Receivables Credit Quality Analysis (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Credit Quality Analysis | |||
Total Receivables | $ 33,489.3 | $ 33,557.3 | $ 31,722.9 |
Wholesale Receivables | |||
Credit Quality Analysis | |||
2021 | 81.1 | ||
2020 | 224.6 | ||
2019 | 66.9 | ||
2018 | 18.4 | ||
2017 | 7.5 | ||
Prior | 1.3 | ||
Revolving | 7,435.7 | ||
Total Receivables | 7,835.5 | $ 7,093.3 | $ 9,146.3 |
Wholesale Receivables | Agriculture and turf | 30-59 Days Past Due | |||
Credit Quality Analysis | |||
Revolving | 7.2 | ||
Total Receivables | 7.2 | ||
Wholesale Receivables | Agriculture and turf | 60-89 Days Past Due | |||
Credit Quality Analysis | |||
2020 | 0.2 | ||
Revolving | 3 | ||
Total Receivables | 3.2 | ||
Wholesale Receivables | Agriculture and turf | 90 Days or Greater Past Due | |||
Credit Quality Analysis | |||
Revolving | 2.2 | ||
Total Receivables | 2.2 | ||
Wholesale Receivables | Agriculture and turf | Current | |||
Credit Quality Analysis | |||
2021 | 78.5 | ||
2020 | 216.5 | ||
2019 | 61.5 | ||
2018 | 17.8 | ||
2017 | 7.5 | ||
Prior | 1.3 | ||
Revolving | 6,092.5 | ||
Total Receivables | 6,475.6 | ||
Wholesale Receivables | Agriculture and turf | Non-performing | |||
Credit Quality Analysis | |||
Revolving | 4.1 | ||
Total Receivables | 4.1 | ||
Wholesale Receivables | Construction and forestry | 30-59 Days Past Due | |||
Credit Quality Analysis | |||
Revolving | 3 | ||
Total Receivables | 3 | ||
Wholesale Receivables | Construction and forestry | 60-89 Days Past Due | |||
Credit Quality Analysis | |||
Revolving | 0.4 | ||
Total Receivables | 0.4 | ||
Wholesale Receivables | Construction and forestry | Current | |||
Credit Quality Analysis | |||
2021 | 2.6 | ||
2020 | 7.9 | ||
2019 | 5.4 | ||
2018 | 0.6 | ||
Revolving | 1,323.3 | ||
Total Receivables | $ 1,339.8 |
Receivables - Wholesale Recei_2
Receivables - Wholesale Receivables Age Credit Quality Analysis (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Age Credit Quality Analysis | |||
Total Receivables | $ 33,489.3 | $ 33,557.3 | $ 31,722.9 |
Wholesale Receivables | |||
Age Credit Quality Analysis | |||
Total Receivables | 7,835.5 | 7,093.3 | 9,146.3 |
Wholesale Receivables | Agriculture and turf | |||
Age Credit Quality Analysis | |||
Current | 5,693.7 | 7,219.4 | |
Non-performing | 4 | 9.9 | |
Wholesale Receivables | Agriculture and turf | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 3.9 | 7.6 | |
Total Receivables | 7.2 | ||
Wholesale Receivables | Agriculture and turf | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 4.4 | 2.3 | |
Total Receivables | 3.2 | ||
Wholesale Receivables | Agriculture and turf | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | 1.1 | 1.5 | |
Total Receivables | 2.2 | ||
Wholesale Receivables | Construction and forestry | |||
Age Credit Quality Analysis | |||
Current | 1,385.9 | 1,899.6 | |
Non-performing | 1.8 | ||
Wholesale Receivables | Construction and forestry | 30-59 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | $ 0.3 | 3.8 | |
Total Receivables | 3 | ||
Wholesale Receivables | Construction and forestry | 60-89 Days Past Due | |||
Age Credit Quality Analysis | |||
Past due | 0.1 | ||
Total Receivables | $ 0.4 | ||
Wholesale Receivables | Construction and forestry | 90 Days or Greater Past Due | |||
Age Credit Quality Analysis | |||
Past due | $ 0.3 |
Receivables - Allowance for Cre
Receivables - Allowance for Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Nov. 01, 2020 | |
Receivable, Allowance for Credit Losses | |||
Recoveries from credit enhancements | $ 0.9 | ||
Allowance: | |||
Beginning of period balance | 129.1 | $ 100.6 | |
Provision (credit) for credit losses | (3) | 12.1 | |
Write-offs | (9.4) | (21.1) | |
Recoveries | 12 | 9 | |
Translation adjustments | 1.1 | 2.5 | |
End of period balance | 149.5 | 103.1 | |
Receivables: | |||
End of period balance | 33,489.3 | 31,722.9 | $ 33,557.3 |
Increase in allowance for credit losses | 20.4 | ||
Cumulative Effect from Adoption | ASU 2016-13 | |||
Allowance: | |||
Beginning of period balance | 19.7 | ||
Unfunded Commitments | |||
Allowance: | |||
Provision (credit) for credit losses | 2.4 | ||
Customer Receivables | |||
Receivables: | |||
End of period balance | 25,653.8 | 22,576.6 | 26,464 |
Retail Notes and Financing Leases | |||
Allowance: | |||
Beginning of period balance | 76.9 | 53.7 | |
Provision (credit) for credit losses | 6.7 | 13.4 | |
Write-offs | (4.1) | (13.9) | |
Recoveries | 2.8 | 0.7 | |
Translation adjustments | 0.9 | ||
End of period balance | 115.7 | 53.9 | |
Receivables: | |||
End of period balance | 23,032.1 | 19,903.4 | 22,636.6 |
Retail Notes and Financing Leases | Cumulative Effect from Adoption | ASU 2016-13 | |||
Allowance: | |||
Beginning of period balance | 32.5 | ||
Revolving charge accounts | |||
Allowance: | |||
Beginning of period balance | 42.3 | 39.3 | |
Provision (credit) for credit losses | (9.7) | (1.1) | |
Write-offs | (5.3) | (6.4) | |
Recoveries | 9.2 | 7.5 | |
End of period balance | 24.3 | 39.3 | |
Receivables: | |||
End of period balance | 2,621.7 | 2,673.2 | 3,827.4 |
Revolving charge accounts | Cumulative Effect from Adoption | ASU 2016-13 | |||
Allowance: | |||
Beginning of period balance | (12.2) | ||
Wholesale Receivables | |||
Allowance: | |||
Beginning of period balance | 9.9 | 7.6 | |
Provision (credit) for credit losses | (0.2) | ||
Write-offs | (0.8) | ||
Recoveries | 0.8 | ||
Translation adjustments | 0.2 | 2.5 | |
End of period balance | 9.5 | 9.9 | |
Receivables: | |||
End of period balance | 7,835.5 | $ 9,146.3 | $ 7,093.3 |
Wholesale Receivables | Cumulative Effect from Adoption | ASU 2016-13 | |||
Allowance: | |||
Beginning of period balance | $ (0.6) |
Receivables - Troubled Debt Res
Receivables - Troubled Debt Restructurings (Details) $ in Millions | 3 Months Ended | |
Jan. 31, 2021USD ($)item | Feb. 02, 2020USD ($)item | |
Receivables Related to Troubled Debt Restructurings | ||
Receivable contracts in troubled debt restructuring, number | item | 95 | 73 |
Receivables in troubled debt restructurings, aggregate balances, pre-modification | $ 5.5 | $ 2.2 |
Receivables in troubled debt restructurings, aggregate balances, post-modification | 5.4 | 2 |
Receivable contracts in troubled debt restructuring, subsequently defaulted | 0 | $ 0 |
Commitments to lend additional funds to borrowers whose accounts were modified in troubled debt restructurings | $ 0 |
Securitization of Receivables_2
Securitization of Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 | |
Securitization of Receivables | |||
Unconsolidated conduits, carrying value of liabilities | $ 35,983.4 | $ 36,559 | $ 34,977 |
Retail notes securitized | 3,928 | 4,689.2 | 4,443.7 |
Allowance for credit losses - securitization transactions | (14.7) | (12.6) | (7.9) |
Other assets - securitization transactions | 94.4 | 97.9 | 91.4 |
Total restricted securitized assets - securitization transactions | 4,007.7 | 4,774.5 | 4,527.2 |
Securitization borrowings | 3,951.5 | 4,656.2 | 4,373.9 |
Accrued interest on borrowings - securitization transactions | 2.4 | 3.2 | 5.2 |
Total liabilities related to restricted securitized assets - securitization transactions | $ 3,953.9 | 4,659.4 | 4,379.1 |
Maximum remaining term of all restricted receivables | 6 years | ||
VIE-Primary Beneficiary | |||
Securitization of Receivables | |||
Total restricted securitized assets - securitization transactions | $ 2,424.7 | 2,897.5 | 2,490.1 |
Total liabilities related to restricted securitized assets - securitization transactions | 2,403.4 | 2,856.2 | 2,442.1 |
Non-VIE Banking Operation | |||
Securitization of Receivables | |||
Total restricted securitized assets - securitization transactions | 463 | 549.7 | 596.6 |
Total liabilities related to restricted securitized assets - securitization transactions | 453.5 | 528.1 | 567.3 |
VIE-Not Primary Beneficiary | |||
Securitization of Receivables | |||
Unconsolidated conduits, carrying value of liabilities | 1,097 | ||
Unconsolidated conduits, maximum exposure to loss | 1,120 | ||
Total assets | 37,000 | ||
Total restricted securitized assets - securitization transactions | 1,120 | 1,327.3 | 1,440.5 |
Total liabilities related to restricted securitized assets - securitization transactions | $ 1,097 | $ 1,275.1 | $ 1,369.7 |
Leases - Lease Revenues (Detail
Leases - Lease Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Lessor | ||
Sales-type and direct finance lease revenues | $ 11.8 | $ 11.6 |
Operating lease revenues | 246.6 | 258.5 |
Variable lease revenues | 5.2 | 4.8 |
Total lease revenues | $ 263.6 | $ 274.9 |
Leases - Cost of Equipment on O
Leases - Cost of Equipment on Operating Leases (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Nov. 01, 2020 | |
Cost of Equipment on Operating Leases | |||
Equipment on operating leases - gross | $ 6,542.5 | $ 6,929.7 | $ 6,805.7 |
Accumulated depreciation | (1,509.9) | (1,404) | (1,507.9) |
Equipment on operating leases - net | 5,032.6 | 5,525.7 | 5,297.8 |
Impairment losses on operating leases | 0 | 0 | |
Operating lease residual value | 3,706.8 | 3,892.4 | 3,826.3 |
Operating lease residual value guarantees | 162.5 | 60.7 | 141 |
Matured operating lease inventory | 72.6 | 127.4 | 64.5 |
Agriculture and turf equipment | |||
Cost of Equipment on Operating Leases | |||
Equipment on operating leases - gross | 5,023.7 | 5,145.3 | 5,210.4 |
Construction and forestry | |||
Cost of Equipment on Operating Leases | |||
Equipment on operating leases - gross | $ 1,518.8 | $ 1,784.4 | $ 1,595.3 |
Leases - Short-term Relief to L
Leases - Short-term Relief to Lessees (Details) | Jan. 31, 2021 |
COVID-19 | |
Lessor | |
Percentage of operating lease portfolio granted relief | 3.00% |
Notes Receivable from John De_3
Notes Receivable from John Deere (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Nov. 01, 2020 | |
John Deere | |||
Notes Receivable from John Deere | |||
Maximum remaining term for related party notes receivable | 7 years | ||
Interest earned | $ 3.3 | $ 4.4 | |
Notes receivable from John Deere | 300 | 282.5 | $ 350 |
Limited Liability Company John Deere Financial | |||
Notes Receivable from John Deere | |||
Notes receivable from John Deere | 89.4 | 115.3 | 132.5 |
Banco John Deere S.A. | |||
Notes Receivable from John Deere | |||
Notes receivable from John Deere | $ 210.6 | $ 167.2 | $ 217.5 |
Commitments and Contingencies -
Commitments and Contingencies - Guarantees (Details) $ in Millions | 3 Months Ended |
Jan. 31, 2021USD ($) | |
John Deere Financial Inc. | Guarantees of debt and derivatives | Medium-term notes | |
Guarantee Obligations | |
Guarantee obligations maximum exposure | $ 1,987.8 |
Weighted average interest rate (as a percent) | 2.40% |
Maximum remaining maturity | 7 years |
John Deere Financial Inc. | Guarantees of debt and derivatives | Derivative Instruments | |
Guarantee Obligations | |
Guarantee obligations maximum exposure | $ 56.5 |
Notional amount | 3,367.6 |
John Deere Canada Funding Inc. (JDCFI) | VIE-Not Primary Beneficiary | |
Guarantee Obligations | |
Carrying value of assets or liabilities related to JDCFI | 0 |
John Deere Canada Funding Inc. (JDCFI) | VIE-Not Primary Beneficiary | Guarantees of debt and derivatives | |
Guarantee Obligations | |
Guarantee obligations maximum exposure | $ 1,130.3 |
Weighted average interest rate (as a percent) | 2.50% |
Maximum remaining maturity | 3 years |
Commitments and Contingencies_2
Commitments and Contingencies - Commitments (Details) $ in Millions | Jan. 31, 2021USD ($) |
Limited Liability Company John Deere Financial | |
Commitments | |
Unused commitments | $ 227.6 |
John Deere dealers | |
Commitments | |
Unused commitments | 9,600 |
Customers | |
Commitments | |
Unused commitments | $ 29,200 |
Minimum percentage of unused commitments to extend credit to customers that relate to revolving charge accounts | 95.00% |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Unrecognized Tax Benefits | |||
Unrecognized tax benefits | $ 27.7 | $ 33.3 | |
Unrecognized tax benefits affecting effective tax rate if recognized | $ 16.6 | $ 17.2 | $ 14.6 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Fair Values of Financial Instruments | |||
Securitization borrowings | $ 3,951.5 | $ 4,656.2 | $ 4,373.9 |
Current maturities of long-term borrowings | 5,686.8 | 5,741.6 | 5,577.6 |
Long-term borrowings | 19,497.5 | 19,311.1 | 20,861.9 |
Level 3 | |||
Fair Values of Financial Instruments | |||
Receivables financed - net | 29,666 | 28,931.7 | 27,221.8 |
Retail notes securitized - net | 4,001.7 | 4,772.9 | 4,463.9 |
Level 2 | |||
Fair Values of Financial Instruments | |||
Securitization borrowings | 3,985.8 | 4,697.6 | 4,403.3 |
Current maturities of long-term borrowings | 5,752.7 | 5,801.1 | 5,597.5 |
Long-term borrowings | 19,992.3 | 19,784.4 | 21,236 |
Carrying Value | |||
Fair Values of Financial Instruments | |||
Receivables financed - net | 29,426.5 | 28,751.6 | 27,184 |
Retail notes securitized - net | 3,913.3 | 4,676.6 | 4,435.8 |
Securitization borrowings | 3,951.5 | 4,656.2 | 4,373.9 |
Current maturities of long-term borrowings | 5,686.8 | 5,741.6 | 5,577.6 |
Long-term borrowings | $ 19,497.5 | $ 19,311.1 | $ 20,861.9 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities - Recurring (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Marketable securities | $ 2.2 | $ 2.2 | $ 2.3 |
Derivative assets | 488.9 | 587 | 422.1 |
Derivative liabilities | 46.9 | 31 | 38.7 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Total assets | 491.1 | 589.2 | 424.4 |
Total liabilities | 46.9 | 31 | 38.7 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Interest rate contracts | Receivables from John Deere | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative assets | 484.3 | 575.5 | 408.3 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Interest rate contracts | Other payables to John Deere | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative liabilities | 42.1 | 29.4 | 33.1 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Foreign exchange contracts | Other Assets | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative assets | 1.2 | 3.8 | 13.4 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Foreign exchange contracts | Accounts payable and accrued expenses | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative liabilities | 3 | 0.9 | 2.1 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Cross-currency interest rate contracts | Receivables from John Deere | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative assets | 3.4 | 7.7 | 0.4 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | Cross-currency interest rate contracts | Other payables to John Deere | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Derivative liabilities | 1.8 | 0.7 | 3.5 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Level 2 | International Debt Securities | Marketable Securities | |||
Assets and Liabilities Measured at Fair Value on Recurring and Nonrecurring Basis | |||
Marketable securities | $ 2.2 | $ 2.2 | $ 2.3 |
Fair Value Measurements - Contr
Fair Value Measurements - Contractual Maturities of Debt Securities (Details) $ in Millions | Jan. 31, 2021USD ($) |
Contractual Maturities of Debt Securities, Amortized Cost | |
Amortized cost basis | $ 4.7 |
Contractual Maturities of Debt Securities, Fair Value | |
Fair value | $ 2.2 |
Fair Value Measurements - Nonre
Fair Value Measurements - Nonrecurring, Level 3 Measurements (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Feb. 02, 2020 | Nov. 01, 2020 | |
Fair Value, Nonrecurring Level 3 Measurements from Impairments | |||
Equipment on operating leases - net | $ 5,032.6 | $ 5,525.7 | $ 5,297.8 |
Losses, Equipment on operating leases - net | $ 0 | $ 0 | |
Fair Value, Nonrecurring Measurements | Level 3 | |||
Fair Value, Nonrecurring Level 3 Measurements from Impairments | |||
Equipment on operating leases - net | 340.3 | ||
Other assets | 56.5 | ||
Total assets | $ 396.8 |
Derivative Instruments - Cash F
Derivative Instruments - Cash Flow Hedges (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 | |
Cash Flow Hedges | |||
Cash flow hedge loss recorded in OCI to be reclassified within twelve months | $ (3.6) | ||
Gains or losses reclassified from OCI to earnings | 0 | ||
Interest rate contracts | Cash flow hedges | Designated as Hedging Instruments | |||
Cash Flow Hedges | |||
Notional amounts | $ 2,350 | $ 1,550 | $ 2,900 |
Derivative Instruments - Fair V
Derivative Instruments - Fair Value Hedges (Details) - Interest rate contracts - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Fair Value Hedges | Designated as Hedging Instruments | |||
Fair Value Hedges | |||
Notional amounts | $ 7,592 | $ 6,525.7 | $ 8,743 |
Current Maturities of Long-term Borrowings | |||
Borrowings Designated in Fair Value Hedging Relationships | |||
Carrying Amount of Hedged Item | 1.3 | 2.5 | |
Carrying Amount of Hedged Item | (5.2) | ||
Discontinued Relationships | 1.3 | 2.5 | (5.2) |
Total | 1.3 | 2.5 | (5.2) |
Long-term Borrowings | |||
Borrowings Designated in Fair Value Hedging Relationships | |||
Carrying Amount of Hedged Item | 8,120.1 | 7,149.8 | 9,061.3 |
Active Hedging Relationships | 423.8 | 530 | 372.6 |
Discontinued Relationships | 137.3 | 121.6 | (21) |
Total | $ 561.1 | $ 651.6 | $ 351.6 |
Derivative Instruments - Not De
Derivative Instruments - Not Designated as Hedging Instruments (Details) - Not Designated as Hedging Instruments - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Interest rate contracts | |||
Derivatives Not Designated as Hedging Instruments | |||
Notional amounts | $ 2,527.7 | $ 2,336.6 | $ 2,342.2 |
Interest rate caps | Sold | |||
Derivatives Not Designated as Hedging Instruments | |||
Notional amounts | 1,743.9 | 1,961.4 | 1,963.2 |
Interest rate caps | Purchased | |||
Derivatives Not Designated as Hedging Instruments | |||
Notional amounts | 1,743.9 | 1,961.4 | 1,963.2 |
Foreign exchange contracts | |||
Derivatives Not Designated as Hedging Instruments | |||
Notional amounts | 113 | 172.6 | 1,365.1 |
Cross-currency interest rate contracts | |||
Derivatives Not Designated as Hedging Instruments | |||
Notional amounts | $ 144.7 | $ 111.5 | $ 100 |
Derivative Instruments - Fair_2
Derivative Instruments - Fair Value (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Fair Value of Derivative Instruments | |||
Total derivative assets | $ 488.9 | $ 587 | $ 422.1 |
Total derivative liabilities | 46.9 | 31 | 38.7 |
Designated as Hedging Instruments | Interest rate contracts | Receivables from John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 474.3 | 565.2 | 402 |
Designated as Hedging Instruments | Interest rate contracts | Other payables to John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative liabilities | 27.7 | 12.7 | 16.5 |
Not Designated as Hedging Instruments | Receivables from John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 13.4 | 18 | 6.7 |
Not Designated as Hedging Instruments | Other Assets | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 1.2 | 3.8 | 13.4 |
Not Designated as Hedging Instruments | Other payables to John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative liabilities | 16.2 | 17.4 | 20.1 |
Not Designated as Hedging Instruments | Interest rate contracts | Receivables from John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 10 | 10.3 | 6.3 |
Not Designated as Hedging Instruments | Interest rate contracts | Other payables to John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative liabilities | 14.4 | 16.7 | 16.6 |
Not Designated as Hedging Instruments | Foreign exchange contracts | Other Assets | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 1.2 | 3.8 | 13.4 |
Not Designated as Hedging Instruments | Foreign exchange contracts | Accounts payable and accrued expenses | |||
Fair Value of Derivative Instruments | |||
Total derivative liabilities | 3 | 0.9 | 2.1 |
Not Designated as Hedging Instruments | Cross-currency interest rate contracts | Receivables from John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative assets | 3.4 | 7.7 | 0.4 |
Not Designated as Hedging Instruments | Cross-currency interest rate contracts | Other payables to John Deere | |||
Fair Value of Derivative Instruments | |||
Total derivative liabilities | $ 1.8 | $ 0.7 | $ 3.5 |
Derivative Instruments - Gains
Derivative Instruments - Gains (Losses) on Statement of Consolidated Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Classification and gains (losses) including accrued interest expense related to derivative instruments | ||
Not designated as hedges, gains (losses) | $ (15.1) | $ 5.7 |
John Deere | ||
Classification and gains (losses) including accrued interest expense related to derivative instruments | ||
Gain (loss) on derivative transactions with affiliate party | (63.8) | 89.8 |
Interest rate contracts | ||
Classification and gains (losses) including accrued interest expense related to derivative instruments | ||
Cash flow hedges, recognized in OCI | (0.5) | (1.6) |
Interest rate contracts | Interest expense | ||
Classification and gains (losses) including accrued interest expense related to derivative instruments | ||
Fair value hedges, gains (losses) | (52.3) | 91.1 |
Cash flow hedges, reclassified from OCI | (4.3) | (1.2) |
Not designated as hedges, gains (losses) | (2.5) | 2 |
Foreign exchange contracts | Administrative and operating expenses | ||
Classification and gains (losses) including accrued interest expense related to derivative instruments | ||
Not designated as hedges, gains (losses) | $ (12.6) | $ 3.7 |
Derivative Instruments - Counte
Derivative Instruments - Counterparty Risk and Collateral (Details) - USD ($) $ in Millions | Jan. 31, 2021 | Nov. 01, 2020 | Feb. 02, 2020 |
Counterparty Risk and Collateral | |||
Cash collateral paid | $ 0 | $ 0 | $ 0 |
Derivative assets | |||
Gross Amounts Recognized | 488.9 | 587 | 422.1 |
Derivative liabilities | |||
Gross Amounts Recognized | 46.9 | 31 | 38.7 |
Cash Collateral Paid | 0 | 0 | 0 |
John Deere | |||
Derivative assets | |||
Gross Amounts Recognized | 487.7 | 583.2 | 408.7 |
Netting Arrangements | (37.9) | (23.5) | (31.6) |
Net Amount | 449.8 | 559.7 | 377.1 |
Derivative liabilities | |||
Gross Amounts Recognized | 43.9 | 30.1 | 36.6 |
Netting Arrangements | (37.9) | (23.5) | (31.6) |
Net Amount | 6 | 6.6 | 5 |
External | |||
Derivative assets | |||
Gross Amounts Recognized | 1.2 | 3.8 | 13.4 |
Netting Arrangements | (0.7) | (0.9) | |
Net Amount | 1.2 | 3.1 | 12.5 |
Derivative liabilities | |||
Gross Amounts Recognized | 3 | 0.9 | 2.1 |
Netting Arrangements | (0.7) | (0.9) | |
Net Amount | 3 | 0.2 | 1.2 |
Derivative Instruments | |||
Counterparty Risk and Collateral | |||
Aggregate liability positions for derivatives with credit risk related contingent features | 0 | 0 | 0 |
Derivative Instruments | John Deere | |||
Counterparty Risk and Collateral | |||
Increase in maximum loss if derivative counterparties fail to meet obligations - loss sharing agreement | 0 | 0 | $ 0 |
International Futures Market | |||
Counterparty Risk and Collateral | |||
Collateral to participate in an international futures market | $ 2.6 | $ 2.6 |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits - Defined Benefit Plan (Details) - Health Care and Life Insurance - USD ($) $ in Millions | 3 Months Ended | |
Jan. 31, 2021 | Feb. 02, 2020 | |
Defined Benefit Plan Disclosure | ||
Expenses related to defined benefit plans | $ 1.6 | $ 5.1 |
2020 Employee-Separation Programs | ||
Defined Benefit Plan Disclosure | ||
Curtailments | $ 3.3 |
Employee-Separation Programs (D
Employee-Separation Programs (Details) - 2020 Employee-Separation Programs $ in Millions | 3 Months Ended |
Feb. 02, 2020USD ($) | |
Employee Separation Programs | |
Total employee separation programs' expenses, pretax | $ 7.7 |
Health Care and Life Insurance | |
Employee Separation Programs | |
Curtailment expense | $ 3.3 |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Curtailment Gain (Loss), Statement of Income or Comprehensive Income [Extensible List] | Selling, General and Administrative Expense |