Short-term Borrowings

3 Months Ended

Mar. 31, 2013

Short-term Borrowings

Short-term Borrowings

9. Short-term Borrowings

The Company enters into repurchase agreements in exchange for cash which it accounts for as secured borrowings.  The Company has pledged Available-for-Sale securities consisting of agency residential mortgage backed securities and commercial mortgage backed securities to collateralize its obligation under the repurchase agreements. The fair value of the securities pledged is recorded in investments and was $208 million and $518 million at March 31, 2013 and December 31, 2012, respectively. The amount of the Company’s liability including accrued interest as of March 31, 2013 and December 31, 2012 was $200 million and $501 million, respectively.  The weighted average annualized interest rate on the repurchase agreements held as of both March 31, 2013 and December 31, 2012 was 0.4%.

RiverSource Life Insurance Company is a member of the Federal Home Loan Bank (“FHLB”) of Des Moines which provides access to collateralized borrowings. The Company has pledged Available-for-Sale securities consisting of commercial mortgage backed securities to collateralize its obligation under these borrowings. The fair value of the securities pledged is recorded in investments and was $389 million at March 31, 2013. The amount of the Company’s liability including accrued interest as of March 31, 2013 was $300 million.  The weighted average annualized interest rate on the FHLB advances held as of March 31, 2013 was 0.3%.