Ameriprise 2013 Annual Report Download - page 154

accumulated investment certificate reserves prior to maturity dates. Cash surrender values on certificates allowing for no
surrender charge are equal to certificate reserves. The Company generally invests the proceeds from investment certificates
in fixed and variable rate securities.
Certain investment certificate products have returns tied to the performance of equity markets. The Company guarantees
the principal for purchasers who hold the certificate for the full 52-week term and purchasers may participate in increases
in the stock market based on the S&P 500 Index, up to a maximum return. Purchasers can choose 100% participation in
the market index up to the cap or 25% participation plus fixed interest with a combined total up to the cap. Current first
term certificates have maximum returns of 1.0% to 2.0%. The equity component of these certificates is considered an
embedded derivative and is accounted for separately. See Note 16 for additional information about derivative instruments
used to economically hedge the equity price risk related to the Company’s stock market certificates.
Brokerage Deposits
Brokerage deposits are amounts payable to brokerage customers related to free credit balances, funds deposited by
customers and funds accruing to customers as a result of trades or contracts. The Company pays interest on certain
customer credit balances and the interest is included in banking and deposit interest expense.
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,
2013 2012 2013 2012
(in millions)
Long-term debt:
Senior notes due 2015 $ 366(1) $ 750(1) 5.7% 5.7%
Senior notes due 2019 327(1) 347(1) 7.3 7.3
Senior notes due 2020 783(1) 812(1) 5.3 5.3
Senior notes due 2023 750 — 4.0 —
Senior notes due 2039 200 200 7.8 7.8
Junior subordinated notes due 2066 294 294 7.5 7.5
Total long-term debt 2,720 2,403
Short-term borrowings:
Federal Home Loan Bank (‘‘FHLB’’) advances 450 — 0.3 —
Repurchase agreements 50 501 0.3 0.4
Total short-term borrowings 500 501
Total $ 3,220 $ 2,904
(1) Amounts include adjustments for fair value hedges on the Company’s long-term debt. See Note 16 for information on the Company’s
fair value hedges.
Long-Term Debt
The amounts included in the table above are net of any unamortized discount and premium associated with issuing these
notes.
On November 13, 2013, the Company issued $150 million of unsecured senior notes due October 15, 2023, and
incurred debt issuance costs of $1 million. These notes form part of the series of senior notes due 2023 along with other
notes of this series issued on September 6, 2013. Interest payments are due semi-annually in arrears on April 15 and
October 15, commencing April 15, 2014.
In October 2013, the Company issued a notice of redemption for $350 million of its senior notes due November 2015.
The notes were redeemed pursuant to the terms of the indenture at the principal value plus an aggregate premium and
accrued interest to the redemption date. The redemption date of the notes was November 4, 2013. The Company
recorded a net pretax loss of $19 million on the redemption of the notes in the fourth quarter of 2013.
On September 6, 2013, the Company issued $600 million of unsecured senior notes due October 15, 2023, and incurred
debt issuance costs of $5 million. Interest payments are due semi-annually in arrears on April 15 and October 15,
commencing April 15, 2014.
On March 11, 2010, the Company issued $750 million 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.
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