Short-term Borrowings and Current Portion of Long-term Debt

12 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

Short-term Borrowings and Current Portion of Long-term Debt

Short-term Borrowings and Current Portion of Long-term Debt

Our short-term borrowings and current portion of long-term debt consists of the followings:

	December 31,
(Dollars in millions)	2014			2013
Commercial paper program	$	245		$	292
Revolving credit facility	—			772
364-day term loan facility	175			300
Other short-term bank loans	257			216
Total short-term borrowings	677			1,580
Current portion of long-term debt	50			73
Short-term borrowings and current portion of long-term debt	$	727		$	1,653
Weighted average interest rate on short-term borrowings outstanding at end of year	1.4		%	1.7		%

Revolving Credit Facility

We maintain a $2.25 billion unsecured, revolving credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, scheduled to mature July 13, 2016. The Credit Agreement can be used for a combination of borrowings, support for our $2.25 billion commercial paper program and issuances of letters of credit. This agreement requires that we maintain a debt-to-total capitalization ratio of less than 60%. We were in compliance with this covenant at December 31, 2014. At December 31, 2014, our outstanding commercial paper had a weighted average interest rate of 0.9%, and there were $30 million in outstanding letters of credit under the Credit Agreement.

364-Day Term Loan Facility

We have a $400 million, 364-day term loan facility with a syndicate of banks. The facility will mature on April 9, 2015. Proceeds from the 364-day term loan facility were used to refinance our previous 364-day term loan facility. The facility has substantially similar terms and conditions to our previously existing $300 million, 364-day term loan facility and also includes the same debt-to-capitalization requirement that is contained in our Credit Agreement, with which we are in compliance. At December 31, 2014, our borrowings under our 364-day term loan facility had an interest rate of 1.9%. As of December 31, 2014, $225 million was repaid, leaving an outstanding balance of $175 million.

Other Short-Term Borrowings

We have short-term borrowings with various domestic and international institutions pursuant to uncommitted facilities. At December 31, 2014, we had $257 million in short-term borrowings under these arrangements with a weighted average interest rate of 1.6%, including $180 million borrowed under a credit agreement entered into in March 2014 that matures on March 20, 2016, with a Libor-based interest rate of 1.3% as of December 31, 2014. In addition, we had $568 million of letters of credit under various uncommitted facilities and $278 million of surety bonds, primarily performance bonds, issued by financial sureties against an indemnification from us at December 31, 2014.

The carrying value of our short-term borrowings approximates their fair value as of December 31, 2014. The current portion of long-term debt at December 31, 2014, is primarily related to our capital leases.