XML 30 R13.htm IDEA: XBRL DOCUMENT v3.19.1
Lines of Credit
12 Months Ended
Dec. 31, 2018
Debt Disclosure [Abstract]  
Lines of Credit

NOTE 7 – LINES OF CREDIT

The following table shows the composition of the Partnership's aggregate bank lines of credit in place as of December 31, 2018 and 2017:

 

 

 

2018

 

 

2017

 

2018 Credit Facility

 

$

500

 

 

$

 

2013 Credit Facility

 

 

 

 

 

400

 

Uncommitted secured credit facilities

 

 

290

 

 

 

290

 

Total bank lines of credit

 

$

790

 

 

$

690

 

 

In November 2013, the Partnership entered into a $400 committed unsecured revolving line of credit ("2013 Credit Facility"), which had a November 2018 expiration date.  In September 2018, the Partnership entered into a new $500 committed revolving line of credit ("2018 Credit Facility"), which replaced the 2013 Credit Facility.  In accordance with the terms of the 2018 Credit Facility, the Partnership is required to maintain a leverage ratio of no more than 35% and minimum Partnership capital, net of reserve for anticipated withdrawals and Partnership loans, of at least $1,884.  In addition, Edward Jones is required to maintain a minimum tangible net worth of at least $1,344 and minimum regulatory capital of at least 6% of aggregate debit items as calculated under the alternative method.  The Partnership has the ability to draw on various types of loans. The associated interest rate depends on the type of loan, duration of the loan, whether the loan is secured or unsecured and the amount of leverage. Rates include the federal funds rate plus the applicable rate, eurodollar rate plus the applicable rate, and the Alternative Base Rate ("ABR") plus the applicable rate.                

The 2018 Credit Facility is intended to provide short-term liquidity to the Partnership should the need arise.  As of December 31, 2018, the Partnership was in compliance with all covenants related to the 2018 Credit Facility.  There were no amounts outstanding on the 2018 Credit Facility as of December 31, 2018. In addition, the Partnership did not have any draws on the 2018 Credit Facility during the year ended December 31, 2018 other than an intraday draw in December 2018 for the purpose of testing draw procedures.

In addition, the Partnership has uncommitted lines of credit that are subject to change at the discretion of the banks.  Based on credit market conditions and the uncommitted nature of these credit facilities, it is possible that these lines of credit could decrease or not be available in the future.  In addition, to the extent these banks provide financing to partners for capital contributions, financing available to the Partnership may be reduced.  Actual borrowing availability on the uncommitted secured lines is based on client margin securities and firm-owned securities, which would serve as collateral on loans in the event the Partnership borrowed against these lines.   

There were no amounts outstanding on the 2013 Credit Facility or the uncommitted lines of credit as of December 31, 2018 and 2017.  In addition, the Partnership did not have any draws against these lines of credit during the years ended December 31, 2018, 2017 and 2016, respectively, other than overnight draws made on the 2013 Credit Facility in September 2017 and October 2016 and on the uncommitted facility in September 2018, April 2018, September 2017, April 2017 and November 2016. All were made for the purpose of periodically testing draw procedures.