Ameriprise 2013 Annual Report Download - page 155

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 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, 2013 and 2012, the Company had met the
specified levels.
On November 23, 2005, the Company issued $1.5 billion of unsecured senior notes including $800 million of 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.
The Company’s senior notes due 2015, 2019, 2020 and 2023 may be redeemed, in whole or in part, at any time prior to
maturity at a price equal to the greater of the principal amount and the present value of remaining scheduled payments,
discounted to the redemption date, plus accrued and unpaid interest. The Company’s senior notes due 2039 may be
redeemed, in whole or in part, on or after June 15, 2014 at a price equal to the principal amount, plus accrued and
unpaid interest to the redemption date.
The Company’s junior subordinated notes due 2066 may be redeemed, in whole or in part, on or after June 1, 2016 at a
price equal to the principal amount plus accrued and compounded interest, provided that if the notes are not redeemed in
whole, at least $50 million aggregate principal amount of notes (excluding notes held by the Company) remain outstanding
after the redemption. Otherwise, the Company’s junior subordinated notes due 2066 are redeemable in whole at any time,
subject to make whole provisions, which are equal to the principal amount plus the present value of interest payments
based on the terms of the note.
The Company’s junior subordinated notes due 2066 and credit facility contain various administrative, reporting, legal and
financial covenants. The Company was in compliance with all such covenants at both December 31, 2013 and 2012.
At December 31, 2013, future maturities of Ameriprise Financial long-term debt were as follows:
(in millions)
2014 $ —
2015 350
2016 —
2017 —
2018 —
Thereafter 2,294
Total future maturities $ 2,644
Short-term Borrowings
The Company enters into repurchase agreements in exchange for cash, which it accounts for as secured borrowings. The
Company has pledged Available-for-Sale securities consisting of agency residential mortgage backed securities and
commercial mortgage backed securities to collateralize its obligation under the repurchase agreements. The fair value of
the securities pledged is recorded in investments and was $52 million and $518 million at December 31, 2013 and
2012, respectively. The stated interest rate of the repurchase agreements is a weighted average annualized interest rate
on repurchase agreements held as of the balance sheet date.
The Company’s insurance subsidiary is a member of the FHLB of Des Moines which provides access to collateralized
borrowings. In 2013, the Company began to borrow short-term funds under these FHLB advances. The Company has
pledged Available-for-Sale securities consisting of commercial mortgage backed securities to collateralize its obligation
under these borrowings. The fair value of the securities pledged is recorded in investments and was $574 million at
December 31, 2013. The stated interest rate of the FHLB advances is a weighted average annualized interest rate on the
outstanding borrowings as of the balance sheet date.
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