PRUDENTIAL FINANCIAL INC
For the period ended Mar 31, 2024. Filed May 2, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed May 2, 2024
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15. Short-Term and Long-Term Debt
- SHORT-TERM AND LONG-TERM DEBT
Short-term Debt
The table below presents the Company’s short-term debt as of the dates indicated:
| March 31, 2024 | December 31, 2023 | |
|---|---|---|
| ($ in millions) | ||
| Commercial paper: | ||
| Prudential Financial | $25 | $25 |
| Prudential Funding, LLC | 480 | 510 |
| Subtotal commercial paper | 505 | 535 |
| Current portion of long-term debt: | ||
| Mortgage debt | 80 | 83 |
| Surplus notes subject to set-off arrangements(1) | 2,000 | 2,000 |
| Subtotal current portion of long-term debt | 2,080 | 2,083 |
| Subtotal | 2,585 | 2,618 |
| Less: assets under set-off arrangements(1) | 2,000 | 2,000 |
| Total short-term debt(2) | $585 | $618 |
| Supplemental short-term debt information: | ||
| Portion of commercial paper borrowings due overnight | $125 | $110 |
| Daily average commercial paper outstanding for the quarter ended | $1,461 | $1,334 |
| Weighted average maturity of outstanding commercial paper, in days | 28 | 49 |
| Weighted average interest rate on outstanding commercial paper | 5.51% | 5.50% |
(1)The surplus notes have corresponding assets where rights to set-off exist, thereby reducing the amount of surplus notes included in short-term debt.
(2)Includes Prudential Financial debt of $25 million at both March 31, 2024 and December 31, 2023.
Prudential Financial and certain subsidiaries have access to external sources of liquidity, including membership in the FHLBNY, a funding agreement facility with the Federal Agricultural Mortgage Company (“Farmer Mac”), commercial paper programs and contingent financing facilities in the form of facility agreements. The Company also maintains syndicated, unsecured committed credit facilities as an alternative source of liquidity. At March 31, 2024, no amounts were drawn on these syndicated, unsecured committed credit facilities. For additional information regarding these sources of liquidity, see Note 18 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Long-term Debt
The table below presents the Company’s long-term debt as of the dates indicated:
| March 31, 2024 | December 31, 2023 | |
|---|---|---|
| (in millions) | ||
| Fixed-rate obligations: | ||
| Surplus notes | $347 | $346 |
| Surplus notes subject to set-off arrangements(1)(2) | 11,002 | 9,790 |
| Senior notes | 10,111 | 10,112 |
| Floating-rate obligations: | ||
| Line of credit | 255 | 255 |
| Surplus notes subject to set-off arrangements(1) | 580 | 580 |
| Mortgage debt(3) | 73 | 75 |
| Junior subordinated notes(4) | 8,582 | 8,094 |
| Subtotal | 30,950 | 29,252 |
| Less: assets under set-off arrangements(1) | 11,582 | 10,370 |
| Total long-term debt(5) | $19,368 | $18,882 |
(1)The surplus notes have corresponding assets where rights to set-off exist, thereby reducing the amount of surplus notes included in long-term debt.
(2)Amount includes $6.2 billion of surplus notes used to finance Guideline AXXX reserves for business reinsured to Somerset Re in March 2024. See Note 12 for additional information.
(3)Includes $25 million and $27 million of debt denominated in foreign currency at March 31, 2024 and December 31, 2023, respectively.
(4)Includes Prudential Financial debt of $8,541 million and $8,050 million at March 31, 2024, and December 31, 2023, respectively. Also includes subsidiary debt of $41 million and $44 million denominated in foreign currency at March 31, 2024, and December 31, 2023, respectively.
(5)Includes Prudential Financial debt of $18,652 million and $18,162 million at March 31, 2024 and December 31, 2023, respectively.
At March 31, 2024 and December 31, 2023, the Company was in compliance with all debt covenants related to the borrowings in the table above.
Junior Subordinated Notes
In March 2024, the Company issued $1.0 billion in aggregate principal amount of 6.50% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due in March 2054, and also redeemed, in full, $0.5 billion in aggregate principal amount of 5.20% Fixed-to-Floating Rate Junior Subordinated Notes due in 2044.
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