Charles Schwab 2010 Annual Report Download - page 84
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THE CHARLES SCHWAB CORPORATION
Notes to Consolidated Financial Statements
(Tabular Amounts in Millions, Except Per Share Data, Option Price Amounts, Ratios, or as Noted)
Annual maturities on long-term debt outstanding at December 31, 2010, are as follows:
CSC has authorization from its Board of Directors to issue unsecured commercial paper notes (Commercial Paper Notes) not to
exceed $1.5 billion. Management has set a current limit for the commercial paper program of $800 million. The maturities of the
Commercial Paper Notes may vary, but are not to exceed 270 days from the date of issue. The commercial paper is not redeemable
prior to maturity and cannot be voluntarily prepaid. The proceeds of the commercial paper program are to be used for general
corporate purposes. There were no Commercial Paper Notes outstanding at December 31, 2010 or 2009.
CSC maintains an $800 million committed, unsecured credit facility with a group of twelve banks, which is scheduled to expire in
June 2011. This facility replaced a similar facility that expired in June 2010. The funds under this facility are available for general
corporate purposes, including repayment of the Commercial Paper Notes discussed above. The financial covenants under this facility
require Schwab to maintain a minimum net capital ratio, as defined, Schwab Bank to be well capitalized, as defined, and CSC to
maintain a minimum level of stockholders’ equity. At December 31, 2010, the minimum level of stockholders’ equity required under
this facility was $4.4 billion. There were no borrowings outstanding under this facility at December 31, 2010 or 2009.
To manage short-term liquidity, Schwab maintains uncommitted, unsecured bank credit lines with a group of seven banks totaling
$829 million at December 31, 2010. CSC has access to $704 million of these credit lines. There were no borrowings outstanding
under these lines at December 31, 2010 or 2009.
To partially satisfy the margin requirement of client option transactions with the Options Clearing Corporation (OCC), Schwab has
unsecured standby LOCs with seven banks in favor of the OCC aggregating $445 million at December 31, 2010. In connection with
its securities lending activities, Schwab is required to provide collateral to certain brokerage clients. Schwab satisfies the collateral
requirements by arranging LOCs, in favor of these brokerage clients, which are issued by multiple banks. At December 31, 2010, the
aggregate face amount of these LOCs totaled $37 million. There were no borrowings outstanding under any of these LOCs at
December 31, 2010 or 2009.
-65 -
2011
$ 6
2012
6
2013
6
2014
756
2015
7
Thereafter
1,228
Total maturities
2,009
Unamortized discount, net
(3)
Total lon
g
-term debt
$ 2,006