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

3 Months Ended

Mar. 31, 2016

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



(Dollars in millions)	March 31, 2016		December 31, 2015
Revolving credit agreement	$	1,035	$	967
Other short-term bank loans	130		214
Total short-term borrowings	1,165		1,181
Current portion of long-term debt	47		401
Short-term borrowings and current portion of long-term debt	$	1,212	$	1,582

Revolving Credit Agreement

At March 31, 2016, we had a $2.0 billion unsecured revolving credit agreement (the “Credit Agreement”) that matures on July 13, 2017. The Credit Agreement can be used for a combination of borrowings, including support for our issuances of letters of credit.

The Credit Agreement was amended on February 1, 2016 to adjust its current amount to $2.0 billion from $2.25 billion as well as to adjust its requirement regarding our debt-to-capitalization ratio. The amended Credit Agreement requires that we maintain a debt-to-total capitalization ratio of less than 70% for the quarters ended March 31, 2016 and June 30, 2016 and less than 60% thereafter. We were in compliance with this covenant at March 31, 2016. At March 31, 2016, we had $949 million available under the Credit Agreement, and there were $16 million in outstanding letters of credit under the Credit Agreement. On May 4, 2016, we entered into an amended and restated credit agreement. See Note 17 – Subsequent Event for additional information.

Other Short-Term Borrowings and Other Debt Activity

We have short-term borrowings with various domestic and international institutions pursuant to uncommitted credit facilities. At March 31, 2016, we had $130 million in short-term borrowings under these arrangements, including overdraft facility borrowings and $30 million borrowed under a credit agreement that matures June 20, 2016. In the first quarter of 2016, we repaid $150 million borrowed under a credit agreement that matured on March 20, 2016. The borrowings under the credit agreement had a LIBOR-based weighted average interest rate of 2.22% as of March 31, 2016. In addition, we had $597 million of letters of credit under various uncommitted facilities and $151 million of surety bonds, primarily performance bonds, issued by financial sureties against an indemnification from us at March 31, 2016.

At March 31, 2016, the current portion of long-term debt was primarily related to our capital leases. Our 5.5% senior note, with a principal balance of $350 million was repaid in February 2016.