Notes Receivable

9 Months Ended

Sep. 30, 2013

6:NOTES RECEIVABLE

Presented in the following table are details of CMS Energy’s and Consumers’ current and non‑current notes receivable:



In Millions
	September 30, 2013			December 31, 2012
CMS Energy, including Consumers
Current
EnerBank notes receivable, net of allowance for loan losses		$	58		$	40
Other			26			1
Non-current
EnerBank notes receivable, net of allowance for loan losses			539			504
Other			-			16
Total notes receivable		$	623		$	561
Consumers
Current
Other		$	25		$	-
Non-current
Other			-			16
Total notes receivable		$	25		$	16

EnerBank notes receivable are unsecured consumer installment loans for financing home improvements.

The allowance for loan losses is a valuation allowance to reflect estimated credit losses. The allowance is increased by the provision for loan losses and decreased by loan charge-offs net of recoveries. Management estimates the allowance balance required by taking into consideration historical loan loss experience, the nature and volume of the portfolio, economic conditions, and other factors. Loan losses are charged against the allowance when the loss is confirmed, but no later than the point at which a loan becomes 120 days past due.

Presented in the following table are the changes in the allowance for loan losses:



In Millions
	Three Months Ended						Nine Months Ended
September 30	2013			2012			2013			2012
Balance at beginning of period		$	5		$	5		$	5		$	5
Charge-offs			(1)			(2)			(4)			(4)
Recoveries			-			1			1			1
Provision for loan losses			1			1			3			3
Balance at end of period		$	5		$	5		$	5		$	5

Loans that are 30 days or more past due are considered delinquent. The balance of EnerBank’s delinquent consumer loans was $3 million at September 30, 2013 and at December 31, 2012.

At September 30, 2013 and December 31, 2012, $1 million of EnerBank’s loans had been modified as troubled debt restructurings.

Consumers Energy Company [Member]

Notes Receivable