Commercial Paper

During the first quarter of 2012, we made the decision to wind-down our commercial paper program. As a result, during the second quarter of 2012, we ceased new commercial paper issuance and completed the wind-down of the program by December 31, 2012.

The following table shows the outstanding commercial paper balances.



	Commercial Paper
	(in millions)
December 31, 2012:
Balance	$	—
Highest aggregate month-end balance	4,660
Average borrowings	1,647
Weighted-average interest rate:
At year-end	—		%
Paid during year	.3
December 31, 2011:
Balance	$	4,026
Highest aggregate month-end balance	4,304
Average borrowings	3,815
Weighted-average interest rate:
At year-end	.3		%
Paid during year	.2
December 31, 2010:
Balance	$	3,157
Highest aggregate month-end balance	4,864
Average borrowings	3,732
Weighted-average interest rate:
At year-end	.3		%
Paid during year	.3

Interest expense for commercial paper totaled $5 million, $9 million and $11 million in 2012, 2011 and 2010, respectively.

We maintain various bank credit agreements which primarily serve to support commercial paper borrowings. We have commercial paper back-up lines of credit totaling $2.1 billion at December 31, 2012 compared to $6.0 billion at December 31, 2011, which includes $100 million and $2.0 billion in commercial paper back-up lines with HSBC affiliates at December 31, 2012 and 2011, respectively. See Note 18, “Related Party Transactions,” for further discussion of the lines with HSBC affiliates.

Our third party back-up line agreements contain a financial covenant which requires us to maintain a minimum tangible common equity to tangible assets ratio of 6.75 percent. Additionally, we are required to maintain a minimum of $5.0 billion of debt extended to us from affiliates. At December 31, 2012, we were in compliance with all applicable financial covenants.

Annual commitment fee expenses to support availability of these lines during 2012, 2011 and 2010 totaled $27 million, $19 million and $33 million, respectively, and included $20 million, $10 million and $16 million, respectively, for the HSBC lines.