Non-current and current receivables recognized in Volvo's customer financing operations.

Sources of uncertainty in the estimates

Non-current customer-financing receivables
Allocation of non-current customer-financing receivables 2011 2010
Installment credits 17,457 15,673
Financial leasing 22,454 19,620
Other receivables 707 732
Total 40,618 36,025

The effective interest rate for non-current customer-financing receivables was 6.98 % as per December 31, 2011.

Non-current customer-financing receivables maturities
Current customer-financing receivables
Allocation of current customer-financing receivables 2011 2010
Installment credits 11,079 11,988
Financial leasing 11,425 10,860
Dealer financing 13,820 12,598
Other receivables 1,757 1,217
Total 38,081 36,663

The effective interest rate for current customer-financing receivables was 6.44% as per December 31, 2011.

Credit risk in the customer-financing operations
 
Customer-financing receivables 2011 2010
Customer-financing receivables gross 79,849 74,013
Valuation allowance for doubtful customer-financing receivables (1,150) (1,325)
   Whereof specific reserve (374) (530)
   Whereof other reserve (776) (795)
Customer-financing receivables, net 78,699 72,688
Customer financing receivables (days/ MSEK) 2011   2010
payments due Not due 1-30 31-90 >90 Total   Not due 1-30 31-90 >90 Total
Overdue amount - 391 230 648 1,269   490 405 805 1,700
Valuation allowance for doubtful customer financing receivables (99) (63) (40) (172) (374)   (91) (56) (74) (308) (530)
Customer financing receivables, net book value (99) 328 190 476 895   (91) 434 331 497 1,170
                       
The table above presents overdue payments within the customer financing operations in relation to specific reserves. It is not unusual for a receivable to be settled a couple of days after its due date, which impacts the age interval of one to 30 days. 
Change of valuation allowances for doubtful customer-financing receivables 2011 2010
Balance sheet, December 31, preceding year 1,325 1,513
New valuation allowance charged to income 910 1,586
Reversal of valuation allowance charged to income  (250) (207)
Utilization of valuation allowance related to actual losses (821) (1,451)
Translation differences (14) (116)
Balance sheet, December 31 1,150 1,325
The total contractual amount to which the overdue payments pertain are presented in the table below. In order to provide for occurred but not yet identified customer-financing receivables overdue, there are additional reserves of 776 (795). The remaining exposure is secured by liens on the purchased equipment, and, in certain circumstances, other credit enhancements such as personal guarantees, credit insurance, liens on other property owned by the borrower etc.

Collateral taken in possession that meet the recognition criteria amounted to 412 (594) at December 31, 2011.
   
 Customer financing receivables 2011   2010
 total exposure Not due 1-30 31-90 >90 Total   Not due 1-30 31-90 >90 Total
Customer financing receivables 70,085 6,828 1,971 965 79,849   63,153 6,425 2,369 2,066 74,013

Concentration of credit risk
Customer concentration
The ten largest customers in Customer Finance account for 5.6 % (5.8) of the total asset portfolio. The rest of the portfolio is pertinent to a large number of customers. This way the credit risk is spread across both many markets and among many customers.

Concentration by geographical market
The adjacent table shows the concentration of the customer-financing portfolio divided into geographical markets.

Geographic market, percentage of customer-financing portfolio (%).

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Volvo’s overriding description of all Group credit risks in Note 4, Financial-risk management.

Volvo Financial Services’ trend during the year.