Long-Term Debt

12 Months Ended

Dec. 31, 2019

Long-term Debt, Unclassified [Abstract]

Debt Disclosure [Text Block]

LONG-TERM DEBT

Long-term debt is summarized as follows:

	December 31,
(In millions)	2019		2018
Subordinated notes	$	572	$	87
Senior notes	1,147		637
Finance lease obligations	4		—
Total	$	1,723	$	724

The preceding carrying values represent the par value of the debt adjusted for any unamortized premium or discount, unamortized debt issuance costs, and basis adjustments for interest rate swaps designated as fair value hedges.

During 2019, the Bank issued $500 million of subordinated notes with a coupon rate of 3.25% and $500 million of senior notes with a coupon rate of 3.35% (see the subsequent Subordinated Notes and Senior Notes schedules). The Bank subsequently entered into receive-fixed interest rate swaps on the notes. For more information on derivatives designated as qualifying hedges, see Note 7 - Derivative Instruments and Hedging Activities.

Subordinated Notes

Subordinated notes issued by the Bank consist of the following at December 31, 2019:

(Dollar amounts in millions)	Subordinated notes
Coupon rate	Balance		Par amount		Maturity
6.95%	$	87	$	88	September 2028
3.25%	485		500		October 2029
Total	$	572	$	588

The 6.95% subordinated notes are unsecured and interest is payable quarterly. The earliest possible redemption date on the 6.95% subordinated notes is September 15, 2023, after which the interest rate changes to an annual floating rate equal to 3mL+3.89%. The 3.25% subordinated notes are unsecured, interest is payable semi-annually, and the earliest possible redemption date is July 29, 2029.

Senior Notes

Senior notes issued by the Bank consist of the following at December 31, 2019:

(Dollar amounts in millions)	Senior notes
Coupon rate	Balance		Par amount		Maturity
4.50%	$	131	$	136	June 2023
3.50%	509		500		August 2021
3.35%	507		500		March 2022
Total	$	1,147	$	1,136

These notes are unsecured and interest is payable semi-annually. The notes were issued under a shelf registration filed with the Securities and Exchange Commission (“SEC”). The notes are not redeemable prior to maturity.

Maturities of Long-term Debt

Maturities of long-term debt are as follows for the years succeeding December 31, 2019:

(In millions)
2020	$	—
2021	499
2022	498
2023	131
2024	—
Thereafter	585
Total	$	1,713

These maturities do not include the basis adjustments for interest rate swaps designated as fair value hedges.