Debt

9 Months Ended

Dec. 31, 2023

Debt Disclosure [Abstract]

Debt

Debt

The Company issues debt in various currencies with both floating and fixed interest rates. Outstanding debt net of discounts and fees, weighted average contractual interest rates and range of contractual interest rates were as follows:

					Weighted average contractual interest rate (1)				Contractual interest rate ranges
	December 31, 2023		March 31, 2023		December 31, 2023		March 31, 2023		December 31, 2023	March 31, 2023
	(U.S. dollars in millions)
Unsecured debt:
Commercial paper	$	6,144	$	6,375	5.73	%	5.18	%	5.10 - 5.80%	4.30 - 5.93%
Bank loans	2,023		1,894		6.18	%	5.66	%	5.82 - 6.62%	5.38 - 6.14%
Public MTN program	27,735		21,962		3.26	%	1.99	%	0.30 - 6.14%	0.30 - 5.43%
Other debt	3,280		3,176		3.60	%	3.15	%	1.34 - 6.39%	1.34 - 5.88%
Total unsecured debt	39,182		33,407
Secured debt	8,722		6,927		4.24	%	2.42	%	0.27 - 5.98%	0.20 - 5.50%
Total debt	$	47,904	$	40,334

_______________________

(1)Weighted average contractual interest rates for commercial paper are bond equivalent yields. Contractual interest rates approximate effective yields.

As of December 31, 2023, the outstanding principal balance of long-term debt with floating interest rates totaled $6.5 billion, long-term debt with fixed interest rates totaled $34.1 billion, and short-term debt with floating or fixed interest rates totaled $7.3 billion. As of March 31, 2023, the outstanding principal balance of long-term debt with floating interest rates totaled $4.1 billion, long-term debt with fixed interest rates totaled $29.5 billion, and short-term debt with floating or fixed interest rates totaled $6.7 billion.

Commercial Paper

As of December 31, 2023 and March 31, 2023, the Company had commercial paper programs that provide the Company with available funds of up to $8.9 billion and $8.8 billion, respectively at prevailing market interest rates for terms up to one year. The commercial paper programs are supported by the Keep Well Agreements with HMC described in Note 6.

Outstanding commercial paper averaged $6.7 billion and $3.4 billion during the nine months ended December 31, 2023 and 2022, respectively. The maximum balance outstanding at any month-end during the nine months ended December 31, 2023 and 2022 was $7.2 billion and $5.3 billion, respectively.

Bank Loans

Outstanding bank loans at December 31, 2023 were long-term, with floating interest rates, and denominated in U.S. dollars or Canadian dollars. Outstanding bank loans have prepayment options. No outstanding bank loans as of December 31, 2023 were supported by the Keep Well Agreements with HMC described in Note 6. Outstanding bank loans contain certain covenants, including limitations on liens, mergers, consolidations and asset sales.

Public MTN Program

In August 2022, AHFC renewed its Public MTN program by filing a registration statement with the SEC under which it may issue from time to time up to $30.0 billion aggregate principal amount of Public MTNs pursuant to the Public MTN program. The aggregate principal amount of MTNs offered under this program may be increased from time to time. Notes outstanding under the Public MTN program as of December 31, 2023 were short-term and long-term, with either fixed or floating interest rates, and denominated in U.S. dollars, Euro or Sterling. Notes under this program are issued pursuant to an indenture which contains certain covenants, including negative pledge provisions and limitations on mergers, consolidations and asset sales.

Other Debt

The outstanding balances as of December 31, 2023 consisted of private placement debt issued by HCFI which are long-term, with either fixed or floating interest rates, and denominated in Canadian dollars. Private placement debt is supported by the Keep Well Agreement with HMC described in Note 6. The notes are issued pursuant to the terms of an indenture which contain certain covenants, including negative pledge provisions.

Secured Debt

The Company issues notes through financing transactions that are secured by assets held by issuing SPEs. Notes outstanding as of December 31, 2023 were long-term and short-term with either fixed or floating interest rates, and denominated in U.S. dollars or Canadian dollars. Repayment of the notes is dependent on the performance of the underlying retail loans. Refer to Note 9 for additional information on the Company’s secured financing transactions.

Credit Agreements

Syndicated Bank Credit Facilities

AHFC maintains a $7.0 billion syndicated bank credit facility that includes a $3.5 billion credit agreement, which expires on February 23, 2024, a $2.1 billion credit agreement, which expires on February 25, 2026, and a $1.4 billion credit agreement, which expires on February 25, 2028. As of December 31, 2023, no amounts were drawn upon under the AHFC credit agreements. AHFC intends to renew or replace these credit agreements prior to or on their respective expiration dates.

HCFI maintains a $1.5 billion syndicated bank credit facility that includes a $755 million credit agreement, which expires on March 25, 2024 and a $755 million credit agreement, which expires on March 25, 2027. As of December 31, 2023, no amounts were drawn upon under the HCFI credit agreements. HCFI intends to renew or replace the credit agreements prior to or on the expiration dates.

The credit agreements contain customary covenants, including limitations on liens, mergers, consolidations and asset sales and affiliate transactions. Loans, if any, under the credit agreements will be supported by the Keep Well Agreement described in Note 6.

Other Credit Agreements

AHFC maintains other committed lines of credit that allow the Company access to an additional $1.0 billion in unsecured funding with two banks. The credit agreements contain customary covenants, including limitations on liens, mergers, consolidations and asset sales. As of December 31, 2023, no amounts were drawn upon under these agreements. These agreements expire in September 2024. The Company intends to renew or replace these credit agreements prior to or on their respective expiration dates.