Finance Receivables (Tables)

3 Months Ended

Mar. 31, 2020

Receivables [Abstract]

Capital Leases Net Investment In Direct Financing Leases

Net investments in direct financing leases is summarized as follows (in thousands):

	March 31, 2020			December 31, 2019
Lease payments receivable	$	655,174		$	686,149
Unguaranteed residual value	798,929			828,206
	1,454,103			1,514,355
Less: unearned income	(588,847		)	(617,806		)
Less: allowance for credit losses (a)	(20,311		)	—
	$	844,945		$	896,549

__________

(a)

In accordance with ASU 2016-13 (Note 2), we applied changes in loss reserves through a cumulative-effect adjustment to retained earnings totaling $14.8 million. In addition, during the three months ended March 31, 2020, we recorded an allowance for credit losses of $5.5 million due to changes in expected economic conditions, which was included within Other gains and (losses) in our consolidated statements of income.

Finance Receivables Credit Quality Indicators

A summary of our finance receivables by internal credit quality rating, excluding our deferred acquisition fees receivable, is as follows (dollars in thousands):

	Number of Tenants / Obligors at		Carrying Value at
Internal Credit Quality Indicator	March 31, 2020	December 31, 2019	March 31, 2020		December 31, 2019
1 – 3	21	28	$	652,628	$	798,108
4	15	8	249,365		146,178
5	—	—	—		—
			$	901,993	$	944,286