December 31 (In millions)				2005			2004
Loans, net of deferred income				$	227,923		$	220,593
Investment in financing leases, net of deferred income					64,309			67,754
					292,232			288,347
Less allowance for losses (note 14)					(4,593	)		(5,648	)
Financing receivables — net				$	287,639		$	282,699

Included in the above are the financing receivables of consolidated, liquidating securitization entities as follows:

December 31 (In millions)				2005			2004
Loans, net of deferred income				$	15,868		$	20,728
Investment in financing leases, net of deferred income					769			2,125
					16,637			22,853
Less allowance for losses					(22	)		(5	)
Financing receivables — net				$	16,615		$	22,848

Details of financing receivables — net follow.

December 31 (In millions)				2005			2004
Commercial Finance
Equipment and leasing				$	70,851		$	64,540
Commercial and industrial					41,402			39,481
Real estate					19,555			20,470
					131,808			124,491
Consumer Finance
Non-U.S. residential mortgages					46,205			42,201
Non-U.S. installment and revolving credit					31,849			33,889
Non-U.S. auto					22,803			23,517
U.S. installment and revolving credit					21,963			21,385
Other					7,286			6,771
					130,106			127,763
Infrastructure (a)					19,124			20,991
Other (b)					11,194			15,102
					292,232			288,347
Less allowance for losses					(4,593	)		(5,648	)
Total				$	287,639		$	282,699

(a)	Included loans and financing leases of $11,192 million and $13,562 million at December 31, 2005 and 2004, respectively, related to commercial aircraft at Aviation Financial Services and loans and financing leases of $5,419 million and $4,659 million at December 31, 2005 and 2004, respectively, related to Energy Financial Services.
(b)	Included loans and financing leases of $10,160 million and $13,759 million at December 31, 2005 and 2004, respectively, related to certain consolidated, liquidating securitization entities.

GECS financing receivables include both loans and financing leases. Loans represent transactions in a variety of forms, including revolving charge and credit, mortgages, installment loans, intermediate-term loans and revolving loans secured by business assets. The portfolio includes loans carried at the principal amount on which finance charges are billed periodically, and loans carried at gross book value, which includes finance charges.

Investment in financing leases consists of direct financing and leveraged leases of aircraft, railroad rolling stock, autos, other transportation equipment, data processing equipment, medical equipment, commercial real estate and other manufacturing, power generation, 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 is generally entitled to any residual value of leased assets.

Investment in direct financing and leveraged leases represents net unpaid rentals and estimated unguaranteed 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. The 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 (a)						Leveraged leases (b)
December 31 (In millions)		2005			2004			2005			2004			2005			2004
Total minimum lease payments receivable	$	86,436		$	91,840		$	60,594		$	63,733		$	25,842		$	28,107
Less principal and interest on third-party nonrecourse debt		(19,061	)		(20,992	)		—			—			(19,061	)		(20,992	)
Net rentals receivable		67,375			70,848			60,594			63,733			6,781			7,115
Estimated unguaranteed residual value of leased assets		9,379			10,323			6,260			6,898			3,119			3,425
Less deferred income		(12,445	)		(13,417	)		(9,305	)		(9,966	)		(3,140	)		(3,451	)
Investment in financing leases, net of deferred income		64,309			67,754			57,549			60,665			6,760			7,089
Less amounts to arrive at net investment
Allowance for losses		(525	)		(1,090	)		(380	)		(903	)		(145	)		(187	)
Deferred taxes		(8,037	)		(9,767	)		(3,495	)		(5,099	)		(4,542	)		(4,668	)
Net investment in financing leases	$	55,747		$	56,897		$	53,674		$	54,663		$	2,073		$	2,234

(a)	Included $475 million and $489 million of initial direct costs on direct financing leases at December 31, 2005 and 2004, respectively.
(b)	Included pre-tax income of $248 million and $340 million and income tax of $96 million and $131 million during 2005 and 2004, respectively. Net investment credits recognized during 2005 and 2004 were inconsequential.

Contractual maturities

(In millions)				Total loans			Net rentals receivable
Due in
2006				$	74,232		$	17,812
2007					30,610			14,320
2008					23,696			10,756
2009					13,812			7,261
2010					14,306			4,164
2011 and later					71,267			13,062
Total				$	227,923		$	67,375

We expect actual maturities to differ from contractual maturities.

Individually “impaired” loans are defined by GAAP as larger balance or restructured 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. An analysis of impaired loans follows.

December 31 (In millions)				2005			2004
Loans requiring allowance for losses				$	1,479		$	1,689
Loans expected to be fully recoverable					451			520
				$	1,930		$	2,209
Allowance for losses				$	627		$	749
Average investment during year					2,118			2,403
Interest income earned while impaired (a)					46			26

(a)	Recognized principally on cash basis.

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