Ameriprise 2011 Annual Report Download - page 148

13. Debt
The balances and the stated interest rates of outstanding debt of Ameriprise Financial were as follows:
Outstanding Balance Stated Interest Rate
December 31, December 31,
2011 2010 2011 2010
(in millions)
Senior notes due 2015 $ 753(1) $ 728(1) 5.7% 5.7%
Senior notes due 2019 341(1) 312(1) 7.3 7.3
Senior notes due 2020 805(1) 763(1) 5.3 5.3
Senior notes due 2039 200 200 7.8 7.8
Junior subordinated notes due 2066 294 308 7.5 7.5
Municipal bond inverse floater certificates due 2021 — 6 — 0.3
Total long-term debt 2,393 2,317
Short-term borrowings 504 397 0.3 0.3
Total $ 2,897 $ 2,714
(1) Amounts include adjustments for fair value hedges on the Company’s long-term debt and any unamortized discounts. See Note 15
for information on the Company’s fair value hedges.
Long-term debt
On November 23, 2005, the Company issued $1.5 billion of unsecured senior notes including five-year notes which
matured November 15, 2010 and 10-year notes which mature November 15, 2015, and incurred debt issuance costs of
$7 million. Interest payments are due semi-annually on May 15 and November 15.
In November 2010, the Company retired $340 million of its senior notes due 2010. In July 2009, the Company
purchased $450 million aggregate principal amount of its senior notes due 2010, pursuant to a cash tender offer. The
tender offer consideration per $1,000 principal amount of these notes accepted for purchase was $1,000, with an early
tender payment of $30. Payments for these notes pursuant to the tender offer included accrued and unpaid interest from
the last interest payment date to, but not including, the settlement date. The Company also purchased $10 million of
these notes in the second quarter of 2009 in open market transactions.
On June 8, 2009, the Company issued $300 million of unsecured senior notes which mature June 28, 2019, and
incurred debt issuance costs of $3 million. Interest payments are due semi-annually in arrears on June 28 and
December 28.
On March 11, 2010, the Company issued $750 million aggregate principal amount of unsecured senior notes which
mature March 15, 2020, and incurred debt issuance costs of $6 million. Interest payments are due semi-annually in
arrears on March 15 and September 15.
On June 3, 2009, the Company issued $200 million of unsecured senior notes which mature June 15, 2039, and
incurred debt issuance costs of $6 million. Interest payments are due quarterly in arrears on March 15, June 15,
September 15 and December 15.
On May 26, 2006, the Company issued $500 million of unsecured junior subordinated notes, which mature June 1,
2066, and incurred debt issuance costs of $6 million. For the initial 10-year period, the junior notes carry a fixed interest
rate of 7.5% payable semi-annually in arrears on June 1 and December 1. From June 1, 2016 until the maturity date,
interest on the junior notes will accrue at an annual rate equal to the three-month LIBOR plus a margin equal to 290.5
basis points, payable quarterly in arrears. The Company has the option to defer interest payments, subject to certain
limitations. In addition, interest payments are mandatorily deferred if the Company does not meet specified capital
adequacy, net income or shareholders’ equity levels. As of December 31, 2011 and 2010, the Company had met the
specified levels.
In 2011, 2010 and 2009, the Company extinguished $14 million, $14 million and $135 million, respectively, of its junior
notes in open market transactions and recognized gains (losses) of nil, $(1) million and $58 million, respectively, in other
revenues.
During the first quarter of 2011, the Company extinguished $6 million of its municipal bond inverse floater certificates
funded through the call of a $10 million portfolio of municipal bonds.
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