Debt

The following table presents the components of notes payable at April 2, 2016 and January 2, 2016:



	April 2, 2016				January 2, 2016
(millions)	Principal amount		Effective interest rate (a)		Principal amount		Effective interest rate
U.S. commercial paper	$	230	0.71	%	$	899	0.45	%
Europe commercial paper	438		(0.03	)%	261		0.01	%
Bank borrowings	50				44
Total	$	718			$	1,204

(a) Negative effective interest rates on certain borrowings in Europe are the result of efforts by the European Central Bank to stimulate the economy in the eurozone.

In March 2016, the Company redeemed $475 million of its 7.45% U.S. Dollar Debentures due 2031. In connection with the debt redemption, the Company incurred $153 million of interest expense, consisting primarily of a premium on the tender offer and also including accelerated losses on pre-issuance interest rate hedges, acceleration of fees and debt discount on the redeemed debt and fees related to the tender offer.

In March 2016, the Company issued $750 million of ten-year 3.25% U.S. Dollar Notes and $650 million of thirty-year 4.5% U.S. Dollar Notes, resulting in aggregate net proceeds after debt discount of $1.382 billion. The proceeds from these Notes were used for general corporate purposes, which included repayment of a portion of the Company’s 7.45% U.S. Dollar Debentures due 2031 and a portion of its commercial paper borrowings. The Notes contain customary covenants that limit the ability of the Company and its restricted subsidiaries (as defined) to incur certain liens or enter into certain sale and lease-back transactions, as well as a change of control provision.

The effective interest rates on debt obligations resulting from the Company’s previous interest rate swaps as of April 2, 2016 were as follows: (a) seven-year 4.45% U.S. Dollar Notes due 2016 – 4.45%; (b) five-year 1.875% U.S. Dollar Notes due 2016 – 1.81%; (c) five-year 1.75% U.S. Dollar Notes due 2017 – 1.71%; (d) seven-year 3.25% U.S. Dollar Notes due 2018 – 2.52%; (e) ten-year 4.15% U.S. Dollar Notes due 2019 – 3.52%; (f) ten-year 4.00% U.S. Dollar Notes due 2020 – 2.98%; (g) ten-year 3.125% U.S. Dollar Notes due 2022 – 2.69%.