Note 13 GECS Financing Receivables (investment in time sales, loans and financing leases) December 31 (In millions) 1995 1994 _____________________________________________________________ Time sales and loans Consumer services $33,430 $25,906 Specialized financing 18,230 17,988 Mid-market financing 8,795 5,916 Equipment management 1,371 1,516 Specialty insurance 189 - _____________________________________________________________ 62,015 51,326 Deferred income (2,424) (1,305) _____________________________________________________________ Time sales and loans - net 59,591 50,021 Investment in financing leases Direct financing leases 33,291 25,916 Leveraged leases 2,909 2,482 _____________________________________________________________ Investment in financing leases 36,200 28,398 _____________________________________________________________ 95,791 78,419 Less allowance for losses (2,519) (2,062) _____________________________________________________________ $93,272 $76,357 Time sales and loans represents transactions in a variety of forms, including time sales, revolving charge and credit, mortgages, installment loans, intermediate-term loans and revolving loans secured by business assets. The portfolio includes time sales and loans carried at the principal amount on which finance charges are billed periodically, and time sales and loans carried at gross book value, which includes finance charges. At year-end 1995 and 1994, specialized financing and consumer services loans included $13,405 million and $13,282 million, respectively, for commercial real estate loans. Note 16 contains information on airline loans and leases. At December 31, 1995, contractual maturities for time sales and loans were $24,543 million in 1996; $11,933 million in 1997; $6,635 million in 1998; $5,052 million in 1999; $4,424 million in 2000; and $9,428 million thereafter - aggregating $62,015 million. Experience has shown that a substantial portion of receivables will be paid prior to contractual maturity. Accordingly, the maturities of time sales and loans are not to be regarded as forecasts of future cash collections. Investment in financing leases consists of direct financing and leveraged leases of aircraft, railroad rolling stock, autos, other transportation equipment, data processing equipment and medical equipment, as well as other manufacturing, power generation, mining and commercial equipment and facilities. As the sole owner of assets under direct financing leases and as the equity participant in leveraged leases, GECS is taxed on total lease payments received and is entitled to tax deductions based on the cost of leased assets and tax deductions for interest paid to third-party participants. GECS generally is entitled to any residual value of leased assets. Investment in direct financing and leveraged leases represents unpaid rentals and estimated unguarantied residual values of leased equipment, less related deferred income. GECS has no general obligation for principal and interest on notes and other instruments representing third-party participation related to leveraged leases; such notes and other instruments have not been included in liabilities but have been offset against the related rentals receivable. GECS' share of rentals receivable on leveraged leases is subordinate to the share of other participants who also have security interests in the leased equipment.

Net investment in financing leases

                                    Total financing leases     Direct financing leases     Leveraged leases
                                    
December 31 (In millions)             1995          1994         1995          1994       1995          1994
____________________________________________________________________________________________________________                                      
                                      
Total minimum lease
  payments receivable             $ 50,059       $39,968      $37,434       $30,338    $12,625       $ 9,630
Less principal and interest on
  third-party nonrecourse debt      (9,329)       (7,103)           -             -     (9,329)       (7,103)
____________________________________________________________________________________________________________

  Net rentals receivable            40,730        32,865       37,434        30,338      3,296         2,527
Estimated unguarantied residual
  value of leased assets             5,768         4,889        4,630         3,767      1,138         1,122
Less deferred income               (10,298)       (9,356)      (8,773)       (8,189)    (1,525)       (1,167)
____________________________________________________________________________________________________________

Investment in financing leases
  (as shown above)                  36,200        28,398       33,291        25,916      2,909         2,482
Less amounts to arrive at 
  net investment
  Allowance for losses                (745)         (570)        (669)         (471)       (76)          (99)
  Deferred taxes arising from
    financing leases                (5,746)       (5,075)      (2,959)       (2,470)    (2,787)       (2,605)
____________________________________________________________________________________________________________

Net investment in
  financing leases             $ 29,709       $22,753      $29,663       $22,975    $    46       $  (222)

At December 31, 1995, contractual maturities for rentals receivable under financing leases were $8,780 million in 1996; $10,418 million in 1997; $6,837 million in 1998; $3,631 million in 1999; $2,126 million in 2000; and $8,938 million thereafter - aggregating $40,730 million. As with time sales and loans, experience has shown that a portion of receivables will be paid prior to contractual maturity, and these amounts should not be regarded as forecasts of future cash flows. Nonearning consumer receivables, primarily private-label credit card receivables, amounted to $671 million and $422 million at December 31, 1995 and 1994, respectively. A majority of these receivables were subject to various loss-sharing arrangements that provide full or partial recourse to the originating private-label entity. Nonearning and reduced-earning receivables other than consumer receivables were $464 million and $346 million at year-end 1995 and 1994, respectively. On January 1, 1995, GE adopted Statement of Financial Accounting Standards (SFAS) No. 114, Accounting by Creditors for Impairment of a Loan, and the related SFAS No. 118, Accounting by Creditors for Impairment of a Loan - Income Recognition and Disclosures. These Statements do not apply to, among other things, leases or large groups of smaller-balance, homogeneous loans, and therefore are principally relevant to GECS' commercial loans. There was no effect of adopting the Statements on 1995 results of operations or financial position because the allowance for losses established under the previous accounting policy continued to be appropriate following the accounting change. The Statements require disclosures of impaired loans - loans for which it is probable that the lender will be unable to collect all amounts due according to original contractual terms of the loan agreement, based on current information and events. At December 31, 1995, loans that required disclosure as impaired amounted to $867 million, principally commercial real estate loans. For $647 million of such loans, the required allowance for losses was $285 million. The remaining $220 million of loans represents the recorded investment in loans that are fully recoverable, but only because the recorded investment had been reduced through charge-offs or deferral of income recognition. These loans must be disclosed under the Statements' technical definition of "impaired" because GECS will be unable to collect all amounts due according to original contractual terms of the loan agreement. Under the Statements, such loans do not require an allowance for losses. GECS' average investment in impaired loans requiring disclosure under the Statements was $1,037 million during 1995, with revenue of $49 million recognized, principally on the cash basis.

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