Long-Term Debt

Long-term debt consists of borrowings having an original maturity of one year or more. The following is a summary of the Company's long-term debt:



(Dollars in millions)	December 31, 2018		December 31, 2017
Debt issued by MUAH
Senior debt:
Floating rate senior notes due February 2018. These notes, which bore interest at 0.57% above 3-month LIBOR, had a rate of 1.97% at December 31, 2017	$	—	$	250
Fixed rate 1.625% notes due February 2018	—		450
Fixed rate 2.25% notes due February 2020	—		998
Fixed rate 3.50% notes due June 2022	398		398
Fixed rate 3.00% notes due February 2025	397		496
Senior debt due to MUFG Bank, Ltd:
Floating rate debt due March 2020. This note, which bore interest at 0.86% above 3-month LIBOR, had a rate of 2.45% at December 31, 2017	—		545
Floating rate debt due September 2020. This note, which bore interest at 0.85% above 3-month LIBOR, had a rate of 2.54% at December 31, 2017	—		3,500
Floating rate debt due December 2021. This note, which bears interest at 0.81% above 3-month LIBOR, had a rate of 3.58% at December 31, 2018	1,625		—
Floating rate debt due December 2022. This note, which bears interest at 0.90% above 3-month LIBOR, had a rate of 3.67% at December 31, 2018	3,250		—
Floating rate debt due December 2023. This note, which bears interest at 0.99% above 3-month LIBOR, had a rate of 3.76% at December 31, 2018	1,625		—
Floating rate debt due December 2023. This note, which bears interest at 0.76% above 3-month EURIBOR, had a rate of 0.76% at December 31, 2018 and at December 31, 2017	24		24
Subordinated debt due to MUFG Bank, Ltd:
Floating rate subordinated debt due December 2023. This note, which bore interest at 1.38% above 3-month LIBOR, had a rate of 3.07% at December 31, 2017	—		300
Junior subordinated debt payable to trusts:
Floating rate note due September 2036. This note had an interest rate of 4.49% at December 31, 2018 and 3.29% at December 31, 2017	36		36
Total debt issued by MUAH	7,355		6,997
Debt issued by MUB
Senior debt:
Fixed rate FHLB of San Francisco advances due between January 2019 and December 2023. These notes bear a combined weighted average rate of 2.66% at December 31, 2018 and 1.51% at December 31, 2017	9,100		1,500
Fixed rate 2.625% notes due September 2018	—		1,000
Fixed rate 2.25% notes due May 2019	498		497
Subordinated debt due to MUFG Bank, Ltd:
Floating rate subordinated debt due June 2023. This note, which bore interest at 1.20% above 3-month LIBOR, had a rate of 2.89% at December 31, 2017	—		750
Other	34		63
Total debt issued by MUB	9,632		3,810
Debt issued by other MUAH subsidiaries
Senior debt due to MUFG Bank, Ltd:
Various floating rate borrowings due between December 2020 and May 2021. These notes, which bear interest above 3-month LIBOR had a weighted average interest rate of 2.80% at December 31, 2018 and 1.78% at December 31, 2017	250		291
Various fixed rate borrowings due between February 2019 and May 2024 with a weighted average interest rate of 1.82% (between 0.14% and 2.44%) at December 31, 2018 and 2.12% (between 1.37% and 2.65%) at December 31, 2017	244		339
Subordinated debt due to Affiliate:
Floating rate borrowings due March 2019. These notes, which bear interest above 6-month LIBOR had an interest rate of 4.13% at December 31, 2018 and 2.95% (between 2.88% and 3.04%) at December 31, 2017	75		185



Non-recourse debt due to MUFG Bank, Ltd:
Various floating rate non-recourse borrowings due between February 2019 and December 2021. These notes, which bear interest above 1- or 3-month LIBOR had a weighted average interest rate of 4.09% (between 2.75% and 4.17%) at December 31, 2018 and 3.07% (between 1.49% and 5.58%) at December 31, 2017	53		79
Fixed rate non-recourse borrowings due between January 2019 and July 2023 which had an interest rate of 3.05% at December 31, 2018 and 3.27% at December 31, 2017	187		240
Other non-recourse debt:
Various floating rate non-recourse borrowings due between February 2019 and May 2019. These notes, which bear interest above 1- or 3-month LIBOR had a weighted average interest rate of 4.21% (between 4.17% and 4.48%) at December 31, 2018 and 2.88% (between 2.50% and 3.54%) at December 31, 2017	89		185
Fixed rate non-recourse borrowings due December 2026 which had an interest rate of 5.34% at December 31, 2018 and December 31, 2017	33		36
Total debt issued by other MUAH subsidiaries	931		1,355
Total long-term debt	$	17,918	$	12,162

Senior Debt

Certain of the debt issuances are repayable prior to maturity at the Company’s option at a redemption price equal to 100% of par plus accrued interest. MUAH senior debt was issued under a shelf registration statement with the SEC, which expired as of January 29, 2018. In the fourth quarter of 2018, the Company redeemed all of the $1.0 billion of the senior notes due 2020 and $100 million of the senior notes due 2025.

MUB senior debt is issued as part of MUB’s $12 billion bank note program under which MUB may issue, from time to time, senior unsecured debt obligations with maturities of more than one year from their respective dates of issue and subordinated debt obligations with maturities of five years or more from their respective dates of issue. At December 31, 2018 there is $5.9 billion available for issuance under the program. MUB does not have any firm commitments in place to sell notes under this program.

MUAH Senior Debt due to MUFG Bank, Ltd.

In December 2018, MUAH entered into a Master Internal Total Loss Absorbing Capacity Loan Agreement with MUFG Bank, Ltd., under which MUAH initially borrowed an aggregate of $6.5 billion to comply with the Federal Reserve’s TLAC rule (12 CFR Section 252.165). MUAH may prepay the notes, in whole or in part, two years prior to the stated maturities. The outstanding principal of the notes can be declared due and payable immediately, together with any accrued and unpaid interest, in the event of liquidation, insolvency or similar proceeding with respect to MUAH or all or substantially all of its property. Under certain circumstances, the Federal Reserve may issue a conversion order pursuant to the TLAC rule (12 CFR Section 252.163) that would result in the conversion of any then-outstanding note, in whole or in part, to MUAH equity issued to MUFG Bank, Ltd.

During the first quarter of 2017, MUAH borrowed $3.5 billion from MUFG Bank, Ltd. in the form of a senior loan. This loan and the $545 million loan outstanding at December 31, 2017 were repaid early in conjunction with the December 2018 TLAC borrowing.

Senior Debt due to MUFG Bank, Ltd. by other MUAH subsidiaries

MUAH’s subsidiaries also borrow on a long-term basis from MUFG Bank, Ltd. At December 31, 2018, $250 million of senior debt issued to MUFG Bank, Ltd. was floating rate and linked to customer deposits maintained at MUFG Bank, Ltd.’s New York Branch. An additional $244 million was fixed rate, amortizing funding tied to specific assets owned by MUAH’s subsidiaries.

FHLB Senior Debt

The Bank borrows periodically from the FHLB on a medium-term basis. The advances are secured by certain of the Bank's assets and bear either a fixed or a floating interest rate. The floating rates are tied to the three-month LIBOR plus a spread, reset every 90 days. As of December 31, 2018 and December 31, 2017, the Bank had $44.3 billion and $43.0 billion of pledged loans, respectively, as collateral for short-term and medium-term advances from the FHLB.

Subordinated Debt due to MUFG Bank, Ltd.

The terms and conditions of the subordinated debt due to MUFG Bank, Ltd. were equivalent to those which would apply in a similar transaction with a non-related party. The subordinated debt due to MUFG Bank, Ltd. was a junior obligation to MUAH’s and to the Bank's existing and future outstanding senior indebtedness, and qualified as Tier 2 capital under the federal banking agency risk-based capital guidelines. This debt was repaid early during 2018.

Subordinated Debt due to Affiliate

MUSA maintains subordinated funding provided by an affiliate. This subordinated debt is a junior obligation to MUSA’s existing and future outstanding senior indebtedness.

Non-recourse Debt

Non-recourse debt serves as funding for certain lease financings offered to customers. The lenders are secured by an interest in the underlying leased assets and have no recourse to the Company or its subsidiaries. Interest and principal on this debt is serviced entirely by the underlying assets and is not supported by the Company.