Voya 2014 Annual Report Download - page 185

Term Loan Agreement
The proceeds of the Term Loan Agreement were used to replace financing that was internally funded. Voya
Financial, Inc. paid interest at a variable rate based on its credit rating and was required to make principal
payments totaling 20.0% of the original borrowing amount over the first 12 months and 30.0% over the second
twelve months with remaining amounts due by April 20, 2014.
During February 2013, we made payments totaling $850.0 million on the Syndicated Bank Term Loan from
the proceeds of the 2018 Notes. On May 21, 2013, we used the proceeds of the 2053 Notes for the repayment of
the final outstanding borrowings of $392.5 million under the Term Loan Agreement. This action, together with
the satisfaction of certain other requirements, caused the requirement to maintain liquidity of $500.0 million at
all times to terminate.
Amended and Restated Credit Agreement
On February 14, 2014, Voya Financial, Inc. revised the terms of its Revolving Credit Agreement by entering
into the Amended and Restated Revolving Credit Agreement (the “Amended and Restated Credit Agreement”)
with a syndicate of banks. The Amended and Restated Credit Agreement modifies the original agreement by 1)
extending the term of the agreement to February 14, 2018; 2) reducing the total amount of LOCs that may be
issued from $3.5 billion to $3.0 billion and 3) reducing the current cost of LOC issuance fees. ING Bank, an
affiliate, acted as Joint Lead Arranger, Joint Book Manager and Documentation Agent and received $0.7 million
for its services and participation in the syndicate.
As of December 31, 2014, there were no amounts outstanding as revolving credit borrowings. As of
December 31, 2014, $1.5 billion of LOCs were outstanding under the Revolving Credit Agreement. Of this total,
LOCs issued by ING Bank amount to $73.3 million.
Credit Facilities and Subsidiary Credit Support Arrangements
We use credit facilities primarily to provide collateral required under our affiliated reinsurance transactions
as well as certain third-party reinsurance arrangements to which our Arizona captive is a party. We also issue
guarantees and enter into financing arrangements in connection with our affiliated reinsurance transactions.
These arrangements are primarily designed to facilitate the financing of statutory reserve requirements.
Regulation XXX and AG38 require insurers to hold significantly higher levels of reserves on term products and
UL insurance products with secondary guarantees, respectively, than are generally thought to be sufficient. By
re-insuring business to our captive reinsurance subsidiaries and our Arizona captive, we are able to use
alternative sources of collateral to fund the statutory reserve requirements and are generally able to secure longer
term financing on a more capital efficient basis.
Effective January 1, 2009, we entered into a master asset purchase agreement (the “MPA”) with Scottish Re
Group Limited, Scottish Holdings, Inc., Scottish Re (U.S.), Inc. (“SRUS”), Scottish Re Life (Bermuda) Limited
(“Scottish Bermuda”) and Scottish Re (Dublin) Limited (collectively, “Scottish Re”) and Hannover Life
Reassurance Company of America (“Hannover US”) and Hannover Re (Ireland) Limited (“HLRI”) (collectively,
“Hannover Re”). Pursuant to the MPA, we recaptured individual life reinsurance business which had previously
been reinsured to Scottish Re and immediately ceded 100.0% of such business to Hannover Re on a modified
coinsurance, funds withheld and coinsurance basis, which resulted in no gain or loss. We will remain obligated to
maintain collateral for the statutory reserve requirements associated with Statutory Regulations XXX and AG38
on the business transferred from us to Hannover Re for the duration of such reserve requirements or until the
underlying reinsurance contracts are novated to Hannover Re or Hannover Re puts into place its own collateral
for such reserve requirements. Hannover Re reimburses us for a portion of our fees for these credit facilities. We
refer to this block as the Hannover Re block and its results are reported as part of the Closed Block Other
segment.
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