Notes payable and other borrowings

9 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Notes payable and other borrowings

Note 17. Notes payable and other borrowings

Notes payable and other borrowings of our insurance and other businesses are summarized below (in millions). The weighted average interest rates and maturity date ranges are based on borrowings as of September 30, 2023.

	Weighted Average Interest Rate			September 30, 2023		December 31, 2022
Insurance and other:
Berkshire Hathaway Inc. (“Berkshire”):
U.S. Dollar denominated due 2025-2047		3.5	%	$	3,737	$	6,231
Euro denominated due 2024-2041		1.1	%		5,884		7,344
Japanese Yen denominated due 2024-2060		0.7	%		7,585		7,818
Berkshire Hathaway Finance Corporation (“BHFC”):
U.S. Dollar denominated due 2027-2052		3.6	%		14,462		14,458
Great Britain Pound denominated due 2039-2059		2.5	%		2,099		2,078
Euro denominated due 2030-2034		1.8	%		1,316		1,332
Other subsidiary borrowings due 2023-2051		4.6	%		4,951		5,967
Subsidiary short-term borrowings		7.1	%		907		1,310
				$	40,941	$	46,538

Notes to Consolidated Financial Statements (Continued)

Note 17. Notes payable and other borrowings (Continued)

In the first nine months of 2023, Berkshire repaid approximately $4.3 billion of maturing senior notes. In April 2023, Berkshire issued ¥164.4 billion (approximately $1.2 billion) of senior notes. Borrowings of BHFC, a wholly owned finance subsidiary of Berkshire, consist of senior unsecured notes used to fund manufactured housing loans originated or acquired and equipment held for lease of certain subsidiaries. BHFC borrowings are fully and unconditionally guaranteed by Berkshire. Berkshire also guarantees certain debt of other subsidiaries, aggregating approximately $2.7 billion at September 30, 2023. Generally, Berkshire’s guarantee of a subsidiary’s debt obligation is an absolute, unconditional and irrevocable guarantee for the full and prompt payment when due of all payment obligations.

The carrying values of Berkshire and BHFC non-U.S. Dollar denominated senior notes (€6.85 billion, £1.75 billion and ¥1,137 billion par at September 30, 2023) reflect the applicable exchange rates as of each balance sheet date. The effects of changes in foreign currency exchange rates during the period are recorded in earnings as a component of selling, general and administrative expenses. Changes in the exchange rates produced pre-tax gains of $582 million in the third quarter and $1.1 billion in the first nine months of 2023 as compared to pre-tax gains of $1.2 billion in the third quarter and $3.3 billion in the first nine months of 2022.

Notes payable and other borrowings of our railroad, utilities and energy businesses are summarized below (in millions). The weighted average interest rates and maturity date ranges are based on borrowings as of September 30, 2023.

	Weighted Average Interest Rate			September 30, 2023		December 31, 2022
Railroad, utilities and energy:
Berkshire Hathaway Energy Company (“BHE”) and subsidiaries:
BHE senior unsecured debt due 2023-2053		4.4	%	$	13,600	$	13,996
Subsidiary and other debt due 2023-2064		4.4	%		39,119		37,639
Short-term borrowings		5.9	%		1,617		1,119
Pilot Travel Centers (“PTC”) and subsidiaries due 2023-2028		7.2	%		5,999		—
Burlington Northern Santa Fe (“BNSF”) and subsidiaries due 2023-2097		4.6	%		23,505		23,452
				$	83,840	$	76,206

BHE subsidiary debt represents amounts issued pursuant to separate financing agreements. Substantially all of the assets of certain BHE subsidiaries are, or may be, pledged or encumbered to support or otherwise secure such debt. These borrowing arrangements generally contain various covenants, including covenants which pertain to leverage ratios, interest coverage ratios and/or debt service coverage ratios. In the first nine months of 2023, BHE subsidiaries issued $3.5 billion of term debt ($2.3 billion in the third quarter) with a weighted average interest rate of 5.7% and maturity dates ranging from 2034 to 2054. During the first nine months of 2023, BHE and its subsidiaries repaid approximately $2.3 billion of term debt.

PTC’s borrowings primarily represent secured syndicated loans. BNSF’s borrowings are primarily senior unsecured debentures. During the first nine months of 2023, BNSF issued $1.6 billion of 5.2% debentures due in 2054 and repaid approximately $1.5 billion of term debt. As of September 30, 2023, BHE, BNSF and PTC and their subsidiaries were in compliance with all applicable debt covenants. Berkshire does not guarantee any debt, borrowings or lines of credit of BHE, BNSF, PTC or their subsidiaries.

Our subsidiaries have unused lines of credit and commercial paper capacity to support short-term borrowing programs and provide additional liquidity. Unused lines of credit were approximately $12.4 billion at September 30, 2023, which included approximately $9.3 billion related to BHE and its subsidiaries.