Derivatives and Hedging Activities |
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Derivatives and Hedging Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives and Hedging Activities | 22. DERIVATIVES AND HEDGING ACTIVITIES On February 1, 2019, the Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of its 2018 Term Loan. The Company swapped $1.2 billion of notional value receiving interest at one month LIBOR plus 200 basis points for a fixed rate of 4.495% per annum settled monthly. On May 23, 2019, the Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a four year interest rate swap on a portion of its 2018 Term Loan. The Company swapped $750.0 million of notional value receiving interest at one month LIBOR plus 200 basis points for a fixed rate of 4.08% per annum settled monthly. On December 3, 2019, the Company, through its wholly owned subsidiary, SBA Senior Finance II, LLC, entered into a series of interest rate swaps on a portion of its 2018 Term Loan, effectively replacing both existing interest rate swaps. As a result, the Company has swapped $1.95 billion of notional value receiving interest at one month LIBOR plus 175 basis points for a fixed rate of 3.78% per annum settled monthly through the maturity date of the 2018 Term Loan. On this date, the Company designated this swap as a cash flow hedge and recorded an initial fair value of $60.5 million. As of December 31, 2019, the Company believes that the hedge remains highly effective; therefore, subsequent changes in the fair value are recorded in Accumulated other comprehensive loss, net. For interest rate swaps de-designated as cash flow hedges, the Company recognized the fair value on the date of de-designation in Accumulated other comprehensive loss, net on the Consolidated Balance Sheets and then reclassified those amounts into Non-cash interest expense on the Consolidated Statements of Operations over the remaining terms of the initial interest rate swap agreements. On a quarterly basis, the Company re-evaluates the fair value of the interest rate swaps using Level 2 inputs, and any changes in the fair value are recorded as gains or losses on the interest rate swap in Non-cash interest expense. The disclosures below provide additional information about the effects of these interest rate swaps on the Consolidated Balance Sheets, Consolidated Statements of Operations, and Consolidated Statements of Comprehensive Income. The cash flows associated with all of these activities are reported in Net cash provided by operating activities on the Consolidated Statements of Cash Flows. The table below outlines the effects of the Company’s interest rate swaps on the Consolidated Balance Sheets at December 31, 2019 and 2018.
The table below outlines the effects of the Company’s derivatives on the Consolidated Statements of Operations for the fiscal years ended December 31, 2019, 2018, and 2017.
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