Long-Term Debt

The carrying value of long-term debt consisted of the following (in millions):


	June 30,		December 31,
	2011		2010
Direct obligations of AFG:
9-7/8% Senior Notes due June 2019	$	350	$	350
7% Senior Notes due September 2050		132		132
7-1/8% Senior Debentures due February 2034		115		115
Other		3		3

		600		600

Subsidiaries:
Obligations of AAG Holding (guaranteed by AFG):
7-1/2% Senior Debentures due November 2033		112		112
7-1/4% Senior Debentures due January 2034		86		86
Notes payable secured by real estate due 2011 through 2016		65		65
Secured borrowings ($17 and $18 guaranteed by AFG)		35		41
National Interstate bank credit facility		22		20
American Premier 10-7/8% Subordinated Notes		—		8

		320		332

Payable to Subsidiary Trusts:
AAG Holding Variable Rate Subordinated Debentures due May 2033		20		20


	$	940	$	952

		Scheduled principal payments on debt for the balance of 2011 and the subsequent five years were as follows: 2011 – $6 million; 2012 – $34 million; 2013 – $20 million; 2014 – $2 million; 2015 – $14 million and 2016 – $45 million.

		As shown below (in millions), the majority of AFG’s long-term debt is unsecured obligations of the holding company and its subsidiaries:


	June 30,		December 31,
	2011		2010
Unsecured obligations	$	840	$	846
Obligations secured by real estate		65		65
Other secured borrowings		35		41

	$	940	$	952

		AFG can borrow up to $500 million under its revolving credit facility which expires in August 2013. Amounts borrowed under this agreement bear interest at rates ranging from 1.75% to 3.00% (currently 2%) over LIBOR based on AFG’s credit rating. No amounts were borrowed under this facility at June 30, 2011.

		In May 2011, American Premier paid $8 million to redeem its outstanding 10-7/8% Subordinated Notes at maturity.

		In June 2010, National Interstate borrowed $30 million under its bank credit facility in connection with the July acquisition of Vanliner. In September 2010, AFG issued $132 million of 7% Senior Notes due in 2050.