US Bank 2011 Annual Report Download - page 99

NOTE 13 Long-Term Debt
Long-term debt (debt with original maturities of more than one year) at December 31 consisted of the following:
(Dollars in Millions) Rate Type Rate (a) Maturity Date 2011 2010
U.S. Bancorp (Parent Company)
Subordinated notes............................................ Fixed 7.500% 2026 $ 199 $ 199
Fixed 3.442% 2016 500 –
Convertible senior debentures ................................. Floating –% 2035 10 10
Floating –% 2036 10 64
Floating –% 2037 21 21
Medium-term notes ............................................ Fixed 1.125%-4.200% 2012-2021 10,530 8,280
Floating .694% 2012 500 500
Junior subordinated debentures ............................... Fixed 6.300%-6.625% 2039-2067 2,691 3,985
Capitalized lease obligations, mortgage indebtedness and
other (b) ..................................................... 132 (22)
Subtotal ..................................................... 14,593 13,037
Subsidiaries
Subordinated notes............................................ Fixed 6.375% 2011 – 1,500
Fixed 6.300% 2014 963 963
Fixed 4.950% 2014 1,000 1,000
Fixed 4.800% 2015 500 500
Fixed 4.375% 2017 1,169 1,348
Fixed 3.778% 2020 500 500
Floating .681% 2014 414 550
Federal Home Loan Bank advances ........................... Fixed .500%-8.250% 2012-2026 3,710 4,101
Floating .392%-1.204% 2012-2017 4,332 4,332
Bank notes .................................................... Fixed 5.920% 2012 99 125
Floating .191%-.640% 2012-2048 1,146 1,157
Capitalized lease obligations, mortgage indebtedness and
other (b) ..................................................... 3,527 2,424
Subtotal ..................................................... 17,360 18,500
Total ........................................................ $31,953 $31,537
(a) Weighted-average interest rates of medium-term notes, Federal Home Loan Bank advances and bank notes were 2.43 percent, 2.31 percent and 1.01 percent, respectively.
(b) Other includes consolidated community development and tax-advantaged investment VIEs, debt issuance fees, and unrealized gains and losses and deferred amounts relating to derivative
instruments.
Convertible senior debentures issued by the Company
pay interest on a quarterly basis until a specified period of
time (five or nine years prior to the applicable maturity date).
After this date, the Company will not pay interest on the
debentures prior to maturity. On the maturity date or on any
earlier redemption date, the holder will receive the original
principal plus accrued interest. The debentures are convertible
at any time on or prior to the maturity date. If the convertible
senior debentures are converted, holders of the debentures will
generally receive cash up to the accreted principal amount of
the debentures plus, if the market price of the Company's
stock exceeds the conversion price in effect on the date of
conversion, a number of shares of the Company's common
stock, or an equivalent amount of cash at the Company's
option, as determined in accordance with specified terms. The
convertible senior debentures are callable by the Company
and putable by the investors at a price equal to 100 percent of
the accreted principal amount plus accrued and unpaid
interest. During 2011, investors elected to put debentures with
a principal amount of $54 million back to the Company. At
December 31, 2011, the weighted average conversion price
per share for all convertible issuances was $38.66.
During 2010, the Company retired $575 million of 5.54
percent fixed-rate junior subordinated debentures issued to a
wholly-owned unconsolidated trust, formed for the purpose of
issuing redeemable Income Trust Securities ("ITS") to third
party investors. During 2011, the same wholly-owned
unconsolidated trust sold the remaining $676 million of junior
subordinated debentures to investors to generate cash
proceeds to purchase the Company's Series A Non-
Cumulative Perpetual Preferred Stock ("Series A Preferred
Stock"). As part of this sale, a consolidated subsidiary of the
Company purchased $176 million of the junior subordinated
debentures, which effectively retired the debt. The Company
classifies the remaining $500 million as subordinated notes in
long-term debt. In addition, during 2011, the Company
elected to redeem $618 million of junior subordinated
debentures issued to four other wholly-owned unconsolidated
trusts that had interest payable at fixed rates ranging from
5.75 percent to 10.20 percent. Refer to Note 14, "Junior
Subordinated Debentures" for further information on the
nature and terms of junior subordinated debentures. There
were no issuances of junior subordinated debentures in 2011
or 2010.
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