Debt

12 Months Ended

Sep. 30, 2021

The disclosures below include details of the Company’s debt, excluding that of CIPs. See Note 11 – Consolidated Investment Products for information related to the debt of these entities.

Debt consisted of the following:


(in millions)	2021		Effective Interest Rate		2020		Effective Interest Rate
as of September 30,
Notes issued by Franklin Resources, Inc.
$300 million 2.800% senior notes due September 2022	$	299.9	2.93	%	$	299.8	2.93	%
$400 million 2.850% senior notes due March 2025	399.7		2.97	%	399.7		2.97	%
$850 million 1.600% senior notes due October 2030	846.3		1.74	%	—		N/A
$350 million 2.950% senior notes due August 2051	347.8		3.00	%	—		N/A
Total notes issued by Franklin Resources, Inc.	1,893.7				699.5
Notes issued by Legg Mason (a subsidiary of Franklin)
$250 million 3.950% senior notes due July 2024	266.5		1.53	%	272.4		1.53	%
$450 million 4.750% senior notes due March 2026	509.6		1.80	%	523.0		1.80	%
$550 million 5.625% senior notes due January 2044	742.2		3.38	%	747.5		3.38	%
$250 million 6.375% junior notes due March 2056	—		N/A		260.7		6.08	%
$500 million 5.450% junior notes due September 2056	—		N/A		516.1		5.25	%
Total notes issued by Legg Mason	1,518.3				2,319.7
Debt issuance costs	(12.6)				(2.1)
Total	$	3,399.4			$	3,017.1

On September 15, 2021, the Company redeemed all of the outstanding $500.0 million 5.450% junior notes due in September 2056 issued by Legg Mason at the principal amount plus accrued and unpaid interest of $6.8 million.

On August 12, 2021, the Company completed its offering and sale of $350.0 million in aggregate principal amount of 2.950% senior unsecured unsubordinated notes due August 2051. The Company incurred $4.1 million of debt issuance costs and the notes were issued at a discount of $2.2 million.

On March 15, 2021, the Company redeemed all of the outstanding $250.0 million 6.375% junior notes due in March 2056 issued by Legg Mason at the principal amount plus accrued and unpaid interest of $4.0 million.

On October 19, 2020, the Company completed its offering and sale of $750.0 million in aggregate principal amount of 1.600% senior unsecured unsubordinated notes due October 2030 (“1.600% Senior Notes”). On August 12, 2021, the Company issued an additional $100.0 million in aggregate principal of 1.600% Senior Notes. The Company incurred $7.7 million in debt issuance costs in total and the notes were issued at an aggregate discount of $3.9 million.

At September 30, 2021, Franklin’s outstanding senior unsecured unsubordinated notes had an aggregate principal amount due of $1,900.0 million. The notes have fixed interest rates with interest payable semi-annually.

At September 30, 2021, Legg Mason’s outstanding senior unsecured unsubordinated notes had an aggregate principal amount due of $1,250.0 million. The notes have fixed interest rates with interest payable semi-annually. Effective August 2, 2021, Franklin has agreed to unconditionally and irrevocably guarantee all of the outstanding notes issued by Legg Mason.

The Franklin and Legg Mason senior notes contain an optional redemption feature that allows the Company to redeem each series of notes prior to maturity in whole or in part at any time, at a make-whole redemption price. The indentures governing the senior notes contain limitations on the Company’s ability and the ability of its subsidiaries to pledge voting stock or profit participating equity interests in its subsidiaries to secure other debt without similarly securing the notes equally and ratably. In addition, the indentures include requirements that must be met if the Company consolidates or merges with, or sells all or substantially all of its assets to, another entity. The Company was in compliance with all debt covenants at September 30, 2021.

At September 30, 2021, the Company had $500.0 million of short-term commercial paper available for issuance under an uncommitted private placement program which has been inactive since 2012.