Long-term debt JPMorgan Chase issues long-term debt denominated in various currencies, although predominantly U.S. dollars, with both fixed and variable interest rates. Included in senior and subordinated debt below are various equity-linked or other indexed instruments, which the Firm has elected to measure at fair value. Changes in fair value are recorded in principal transactions revenue in the Consolidated Statements of Income. The following table is a summary of long-term debt carrying values (including unamortized original issue discount, valuation adjustments and fair value adjustments, where applicable) by remaining contractual maturity as of December 31, 2013. | | | | | | | | | | | | | | | | | | | | | | By remaining maturity at December 31, | | 2013 | | 2012 |
| (in millions, except rates) | | Under 1 year |
| | 1-5 years |
| | After 5 years |
| | Total |
| | Total |
| Parent company | | |
| | | | | | | | |
| Senior debt: | Fixed rate | $ | 11,100 |
| | $ | 49,241 |
| | $ | 40,733 |
| | $ | 101,074 |
| | $ | 99,716 |
| | Variable rate | 12,411 |
| | 22,790 |
| | 5,829 |
| | 41,030 |
| | 38,765 |
| | Interest rates(a) | 0.38-6.25% |
| | 0.35-7.25% |
| | 0.19-6.40% |
| | 0.19-7.25% |
| | 0.26-7.25% |
| Subordinated debt: | Fixed rate | $ | 2,904 |
| | $ | 4,966 |
| | $ | 7,328 |
| | $ | 15,198 |
| | $ | 16,312 |
| | Variable rate | — |
| | 4,557 |
| | 9 |
| | 4,566 |
| | 3,440 |
| | Interest rates(a) | 1.92-5.13% |
| | 0.63-6.13% |
| | 3.38-8.53% |
| | 0.63-8.53% |
| | 0.61-8.53% |
| | Subtotal | $ | 26,415 |
| | $ | 81,554 |
| | $ | 53,899 |
| | $ | 161,868 |
| | $ | 158,233 |
| Subsidiaries | | |
| | |
| | |
| | |
| | |
| Federal Home Loan Banks ("FHLB") advances: | Fixed rate | $ | 1,029 |
| | $ | 2,022 |
| | $ | 185 |
| | $ | 3,236 |
| | $ | 4,712 |
| | Variable rate | 11,050 |
| | 39,590 |
| | 8,000 |
| | 58,640 |
| | 37,333 |
| | Interest rates(a) | 0.20-1.54% |
| | 0.16-2.04% |
| | 0.36-0.43% |
| | 0.16-2.04% |
| | 0.30-2.04% |
| Senior debt: | Fixed rate | $ | 347 |
| | $ | 1,655 |
| | $ | 3,426 |
| | $ | 5,428 |
| | $ | 6,761 |
| | Variable rate | 6,593 |
| | 14,117 |
| | 2,748 |
| | 23,458 |
| | 21,607 |
| | Interest rates(a) | 0.12-3.75% |
| | 0.21-8.00% |
| | 7.28 | % | | 0.12-8.00% |
| | 0.16-7.28% |
| Subordinated debt: | Fixed rate | $ | — |
| | $ | 5,445 |
| | $ | 1,841 |
| | $ | 7,286 |
| | $ | 7,513 |
| | Variable rate | — |
| | 2,528 |
| | — |
| | 2,528 |
| | 2,466 |
| | Interest rates(a) | — | % | | 0.57-6.00% |
| | 4.38-8.25% |
| | 0.57-8.25% |
| | 0.64-8.25% |
| | Subtotal | $ | 19,019 |
| | $ | 65,357 |
| | $ | 16,200 |
| | $ | 100,576 |
| | $ | 80,392 |
| Junior subordinated debt: | Fixed rate | $ | — |
| | $ | — |
| | $ | 2,176 |
| | $ | 2,176 |
| | $ | 7,131 |
| | Variable rate | — |
| | — |
| | 3,269 |
| | 3,269 |
| | 3,268 |
| | Interest rates(a) | — | % | | — | % | | 0.74-8.75% |
| | 0.74-8.75% |
| | 0.81-8.75% |
| | Subtotal | $ | — |
| | $ | — |
| | $ | 5,445 |
| | $ | 5,445 |
| | $ | 10,399 |
| Total long-term debt(b)(c)(d) | | $ | 45,434 |
| | $ | 146,911 |
| | $ | 75,544 |
| | $ | 267,889 |
| (f)(g) | $ | 249,024 |
| Long-term beneficial interests: | | |
| | |
| | |
| | |
| | |
| | Fixed rate | $ | 353 |
| | $ | 7,537 |
| | $ | 3,068 |
| | $ | 10,958 |
| | $ | 10,393 |
| | Variable rate | 3,438 |
| | 13,056 |
| | 4,378 |
| | 20,872 |
| | 24,579 |
| | Interest rates | 0.19-5.63% |
| | 0.19-5.35% |
| | 0.04-15.93% |
| | 0.04-15.93% |
| | 0.23-13.91% |
| Total long-term beneficial interests(e) | | $ | 3,791 |
| | $ | 20,593 |
| | $ | 7,446 |
| | $ | 31,830 |
| | $ | 34,972 |
|
| | (a) | The interest rates shown are the range of contractual rates in effect at year-end, including non-U.S. dollar fixed- and variable-rate issuances, which excludes the effects of the associated derivative instruments used in hedge accounting relationships, if applicable. The use of these derivative instruments modifies the Firm’s exposure to the contractual interest rates disclosed in the table above. Including the effects of the hedge accounting derivatives, the range of modified rates in effect at December 31, 2013, for total long-term debt was (0.18)% to 8.00%, versus the contractual range of 0.12% to 8.75% presented in the table above. The interest rate ranges shown exclude structured notes accounted for at fair value. |
| | (b) | Included long-term debt of $68.4 billion and $48.0 billion secured by assets totaling $131.3 billion and $112.8 billion at December 31, 2013 and 2012, respectively. The amount of long-term debt secured by assets does not include amounts related to hybrid instruments. |
| | (c) | Included $28.9 billion and $30.8 billion of long-term debt accounted for at fair value at December 31, 2013 and 2012, respectively. |
| | (d) | Included $2.7 billion and $1.6 billion of outstanding zero-coupon notes at December 31, 2013 and 2012, respectively. The aggregate principal amount of these notes at their respective maturities is $4.5 billion and $3.0 billion, respectively. |
| | (e) | Included on the Consolidated Balance Sheets in beneficial interests issued by consolidated VIEs. Also included $2.0 billion and $1.2 billion of outstanding structured notes accounted for at fair value at December 31, 2013 and 2012, respectively. Excluded short-term commercial paper and other short-term beneficial interests of $17.8 billion and $28.2 billion at December 31, 2013 and 2012, respectively. |
| | (f) | At December 31, 2013, long-term debt in the aggregate of $24.6 billion was redeemable at the option of JPMorgan Chase, in whole or in part, prior to maturity, based on the terms specified in the respective notes. |
| | (g) | The aggregate carrying values of debt that matures in each of the five years subsequent to 2013 is $45.4 billion in 2014, $43.3 billion in 2015, $36.3 billion in 2016, $32.5 billion in 2017 and $34.8 billion in 2018. |
The weighted-average contractual interest rates for total long-term debt excluding structured notes accounted for at fair value were 2.56% and 3.09% as of December 31, 2013 and 2012, respectively. In order to modify exposure to interest rate and currency exchange rate movements, JPMorgan Chase utilizes derivative instruments, primarily interest rate and cross-currency interest rate swaps, in conjunction with some of its debt issues. The use of these instruments modifies the Firm’s interest expense on the associated debt. The modified weighted-average interest rates for total long-term debt, including the effects of related derivative instruments, were 1.54% and 2.33% as of December 31, 2013 and 2012, respectively. The Parent Company has guaranteed certain long-term debt of its subsidiaries, including both long-term debt and structured notes sold as part of the Firm’s market-making activities. These guarantees rank on parity with all of the Firm’s other unsecured and unsubordinated indebtedness. Guaranteed liabilities were $478 million and $1.7 billion at December 31, 2013 and 2012, respectively. The Firm’s unsecured debt does not contain requirements that would call for an acceleration of payments, maturities or changes in the structure of the existing debt, provide any limitations on future borrowings or require additional collateral, based on unfavorable changes in the Firm’s credit ratings, financial ratios, earnings or stock price. Junior subordinated deferrable interest debentures held by trusts that issued guaranteed capital debt securities On May 8, 2013, the Firm redeemed approximately $5.0 billion , or 100% of the liquidation amount, of the following eight series of guaranteed capital debt securities (“trust preferred securities”): JPMorgan Chase Capital X, XI, XII, XIV, XVI, XIX and XXIV, and BANK ONE Capital VI. Other income for the year ended December 31, 2013, reflected a modest loss related to the redemption of trust preferred securities. On July 12, 2012, the Firm redeemed $9.0 billion, or 100% of the liquidation amount, of the following nine series of trust preferred securities: JPMorgan Chase Capital XV, XVII, XVIII, XX, XXII, XXV, XXVI, XXVII and XXVIII. Other income for the year ended December 31, 2012, reflected $888 million of pretax extinguishment gains related to adjustments applied to the cost basis of the redeemed trust preferred securities during the period they were in a qualified hedge accounting relationship. At December 31, 2013, the Firm had outstanding 9 wholly owned Delaware statutory business trusts (“issuer trusts”) that had issued guaranteed capital debt securities. The junior subordinated deferrable interest debentures issued by the Firm to the issuer trusts, totaling $5.4 billion and $10.4 billion at December 31, 2013 and 2012, respectively, were reflected on the Firm’s Consolidated Balance Sheets in long-term debt, and in the table on the preceding page under the caption “Junior subordinated debt” (i.e., trust preferred securities). The Firm also records the common capital securities issued by the issuer trusts in other assets in its Consolidated Balance Sheets at December 31, 2013 and 2012. The debentures issued to the issuer trusts by the Firm, less the common capital securities of the issuer trusts, qualified as Tier 1 capital as of December 31, 2013 and 2012.
The following is a summary of the outstanding trust preferred securities, including unamortized original issue discount, issued by each trust, and the junior subordinated deferrable interest debenture issued to each trust, as of December 31, 2013. | | | | | | | | | | | | | | | | | | | | December 31, 2013 (in millions) | | Amount of trust preferred securities issued by trust(a) | | Principal amount of debenture issued to trust(b) | | Issue date | | Stated maturity of trust preferred securities and debentures | | Earliest redemption date | | Interest rate of trust preferred securities and debentures | | Interest payment/distribution dates | Bank One Capital III | | $ | 474 |
| | $ | 675 |
| | 2000 | | 2030 | | Any time | | 8.75% | | Semiannually | Chase Capital II | | 482 |
| | 498 |
| | 1997 | | 2027 | | Any time | | LIBOR + 0.50% | | Quarterly | Chase Capital III | | 296 |
| | 305 |
| | 1997 | | 2027 | | Any time | | LIBOR + 0.55% | | Quarterly | Chase Capital VI | | 241 |
| | 249 |
| | 1998 | | 2028 | | Any time | | LIBOR + 0.625% | | Quarterly | First Chicago NBD Capital I | | 249 |
| | 257 |
| | 1997 | | 2027 | | Any time | | LIBOR + 0.55% | | Quarterly | JPMorgan Chase Capital XIII | | 465 |
| | 480 |
| | 2004 | | 2034 | | 2014 | | LIBOR + 0.95% | | Quarterly | JPMorgan Chase Capital XXI | | 836 |
| | 837 |
| | 2007 | | 2037 | | Any time | | LIBOR + 0.95% | | Quarterly | JPMorgan Chase Capital XXIII | | 643 |
| | 644 |
| | 2007 | | 2047 | | Any time | | LIBOR + 1.00% | | Quarterly | JPMorgan Chase Capital XXIX | | 1,500 |
| | 1,500 |
| | 2010 | | 2040 | | 2015 | | 6.70% | | Quarterly | Total | | $ | 5,186 |
| | $ | 5,445 |
| | | | | | | | | | |
| | (a) | Represents the amount of trust preferred securities issued to the public by each trust, including unamortized original issue discount. |
| | (b) | Represents the principal amount of JPMorgan Chase debentures issued to each trust, including unamortized original-issue discount. The principal amount of debentures issued to the trusts includes the impact of hedging and purchase accounting fair value adjustments that were recorded on the Firm’s Consolidated Financial Statements. |
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