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AMERICAN EXPRESS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
LONG-TERM DEBT
The Company’s long-term debt outstanding, defined as debt with original maturities of one year or greater, as of December 31 was as follows:
2013 2012
(Millions, except percentages)
Maturity
Dates
Outstanding
Balance(a)
Year-End
Stated Rate
on Debt(b)
Year-End
Effective
Interest
Rate with
Swaps(b)(c)
Outstanding
Balance(a)
Year-End
Stated Rate
on Debt(b)
Year-End
Effective
Interest
Rate with
Swaps(b)(c)
American Express Company
(Parent Company only)
Fixed Rate Senior Notes 2014-2042 $ 8,784 5.43% 4.60% $ 8,848 5.78% 4.95%
Floating Rate Senior Notes 2018 850 0.84 — —— —
Subordinated Debentures(d) 2036 749 6.80 — 749 6.80 —
American Express Credit Corporation
Fixed Rate Senior Notes 2014-2018 14,875 3.13 2.03 17,163 4.20 2.39
Floating Rate Senior Notes 2014-2016 2,855 1.14 — 2,203 1.59 —
Borrowings under Bank Credit Facilities 2015-2016 4,012 4.18 — 4,672 4.87 —
American Express Centurion Bank
Fixed Rate Senior Notes 2015-2017 2,102 4.12 3.32 2,120 4.12 3.32
Floating Rate Senior Notes 2015-2018 675 0.67 — 550 0.76 —
American Express Bank, FSB
Fixed Rate Senior Notes 2017 999 6.00 — 2,764 5.68 3.68
Floating Rate Senior Notes 2017 300 0.47 — 300 0.51 —
American Express Charge Trust II
Floating Rate Senior Notes 2016-2018 4,200 0.49 — 3,000 0.49 —
Floating Rate Subordinated Notes 2016-2018 87 0.80 — —— —
American Express Lending Trust
Fixed Rate Senior Notes 2015-2016 2,600 0.72 — 2,100 0.65 —
Floating Rate Senior Notes 2014-2018 10,685 0.81 — 12,810 0.90 —
Fixed Rate Subordinated Notes 2015 300 1.08 — 300 1.08 —
Floating Rate Subordinated Notes 2014-2018 847 0.81 — 1,091 0.93 —
Other
Fixed Rate Instruments(e) 2014-2030 239 3.95 — 123 5.94 —
Floating Rate Borrowings 2014-2016 276 0.62 —% 292 0.65 —%
Unamortized Underwriting Fees (105) (112)
Total Long-Term Debt $ 55,330 2.56% $ 58,973 3.04%
(a) The outstanding balances include (i) unamortized discount and premium, (ii) the impact of movements in exchange rates on foreign currency denominated debt and
(iii) the impact of fair value hedge accounting on certain fixed-rate notes that have been swapped to floating rate through the use of interest rate swaps. Under fair
value hedge accounting, the outstanding balances on these fixed-rate notes are adjusted to reflect the impact of changes in fair value due to changes in interest rates.
Refer to Note 12 for more details on the Company’s treatment of fair value hedges.
(b) For floating-rate debt issuances, the stated and effective interest rates are based on the floating rates in effect as of December 31, 2013 and 2012, respectively.
(c) Effective interest rates are only presented when swaps are in place to hedge the underlying debt.
(d) The maturity date will automatically be extended to September 1, 2066, except in the case of either (i) a prior redemption or (ii) a default. See further discussion on
this page.
(e) Includes $109 million and $118 million as of December 31, 2013 and 2012, respectively, related to capitalized lease transactions.
As of December 31, 2013 and 2012, the Parent Company had $750
million principal outstanding of Subordinated Debentures that accrue
interest at an annual rate of 6.8 percent until September 1, 2016, and at
an annual rate of three-month LIBOR plus 2.23 percent thereafter. At
the Company’s option, the Subordinated Debentures are redeemable
for cash after September 1, 2016 at 100 percent of the principal
amount plus any accrued but unpaid interest. If the Company fails to
achieve specified performance measures, it will be required to issue
common shares and apply the net proceeds to make interest payments
on the Subordinated Debentures. No dividends on the Company’s
common or preferred shares could be paid until such interest
payments are made. The Company would fail to meet these specific
performance measures if (i) the Company’s tangible common equity is
less than 4 percent of total adjusted assets for the most recent quarter
or (ii) if the trailing two quarters’ consolidated net income is equal to
or less than zero and tangible common equity as of the trigger
determination date, and as of the end of the quarter end six months
prior, has in each case declined by 10 percent or more from tangible
common equity as of the end of the quarter 18 months prior to the
trigger determination date. The Company met the specified
performance measures in 2013.
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