Corporate Debt

12 Months Ended

Dec. 31, 2018

NOTE 14—CORPORATE DEBT

The following table presents the significant components of corporate debt (dollars in millions):



	Face Value		Discount			Net
December 31, 2018
Interest-bearing notes:
2.95% Senior Notes, due 2022	$	600	$	(4	)	$	596
3.80% Senior Notes, due 2027	400		(3		)	397
4.50% Senior Notes, due 2028	420		(4		)	416
Total corporate debt	$	1,420	$	(11	)	$	1,409



December 31, 2017
Interest-bearing notes:
2.95% Senior Notes, due 2022	$	600	$	(5	)	$	595
3.80% Senior Notes, due 2027	400		(4		)	396
Total corporate debt	$	1,000	$	(9	)	$	991

Issuance of Corporate Debt

2018 Issuances

During the year ended December 31, 2018, the Company issued $420 million in aggregate principal amount of Senior Notes due 2028. The Senior Notes bear interest at an annual rate of 4.50% and will mature on June 20, 2028. The Senior Notes are our general unsecured senior obligations and rank equally in right of payment with all of our existing and future unsubordinated indebtedness. The Senior Notes effectively rank junior to our secured indebtedness, if any, to the extent of the collateral securing such indebtedness, and are structurally subordinated to all liabilities of our subsidiaries. The Senior Notes are not guaranteed by the subsidiaries.

The Company used the proceeds from the issuance of the Senior Notes for the redemption of the TRUPs issued by ETB Holdings, a subsidiary of E*TRADE Financial. For additional information about TRUPs, see Note 13—Other Borrowings and Note 21—Commitments, Contingencies and Other Regulatory Matters.

2017 Issuances

During the year ended December 31, 2017, the Company issued $1 billion in aggregate principal amount of Senior Notes in two tranches. The first tranche of $600 million aggregate principal amount of Senior Notes due 2022 bears interest at an annual rate of 2.95% and will mature on August 24, 2022. The second tranche of $400 million aggregate principal amount of Senior Notes due 2027 bears interest at an annual rate of 3.80% and will mature on August 24, 2027 (together with the first tranche, the “Notes”). The Notes are the Company's general unsecured senior obligations and rank equally with the Company's other unsecured senior indebtedness. The Notes effectively rank junior to secured indebtedness, if any, to the

extent of the collateral securing such indebtedness and all liabilities of the Company's subsidiaries. The Notes are not guaranteed by the subsidiaries.

The net proceeds from the issuance of the Notes were used, along with existing corporate cash, to redeem all $540 million aggregate principal amount of the outstanding 5.375% Senior Notes due 2022 and all $460 million aggregate principal amount of the outstanding 4.625% Senior Notes due 2023, including associated redemption premiums, accrued interest, and related fees and expenses. In connection with the redemption, the Company recognized a loss on early extinguishment of debt of $58 million.

Credit Facility

In 2017, the Company entered into a $300 million unsecured committed revolving credit facility with certain lenders which will mature on June 23, 2020. The Company has the ability to borrow against the credit facility for working capital and general corporate purposes. The credit facility has terms which include financial maintenance covenants, with which the Company was in compliance at December 31, 2018. At December 31, 2018, there was no outstanding balance under this revolving credit facility.

Ranking of Debt Seniority

All of the Company’s notes rank equal in right of payment with all of the Company’s existing and future unsubordinated indebtedness and rank senior in right of payment to all its existing and future subordinated indebtedness. However, the notes rank effectively junior to the Company's secured indebtedness to the extent of the collateral securing such indebtedness.