Debt

12 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Debt

Debt

The disclosures below include details of the Company’s debt, excluding that of CIPs. See Note 10 – Consolidated Investment Products for information related to the debt of these entities.

Debt consisted of the following:

(in millions)	2022		Effective Interest Rate		2021		Effective Interest Rate
as of September 30,
Debt of Franklin Resources, Inc.
$300 million 2.800% senior notes due September 2022	$	—	N/A		$	299.9	2.93	%
$400 million 2.850% senior notes due March 2025	399.8		2.97	%	399.7		2.97	%
$850 million 1.600% senior notes due October 2030	846.7		1.74	%	846.3		1.74	%
$350 million 2.950% senior notes due August 2051	347.9		3.00	%	347.8		3.00	%
$300 million term loan due September 2025	300.0		3.50	%	—		N/A
Total debt of Franklin Resources, Inc.	1,894.4				1,893.7
Debt of Legg Mason (a subsidiary of Franklin)
$250 million 3.950% senior notes due July 2024	260.6		1.53	%	266.5		1.53	%
$450 million 4.750% senior notes due March 2026	496.2		1.80	%	509.6		1.80	%
$550 million 5.625% senior notes due January 2044	736.3		3.38	%	742.2		3.38	%
Total debt of Legg Mason	1,493.1				1,518.3
Debt issuance costs	(11.1)				(12.6)
Total	$	3,376.4			$	3,399.4

On September 15, 2022, the Company repaid all of the outstanding $300.0 million 2.800% senior notes due in September 2022 issued by Franklin Resources, Inc. at the principal amount plus accrued and unpaid interest of $4.2 million.

On September 8, 2022, the Company entered into a term loan credit agreement with several financial institutions to establish a 3-year term loan with an aggregate commitment of $300.0 million.

On January 10, 2022, the Company entered into a bi-lateral credit agreement with Bank of America, N.A. to establish a 364-day revolving credit facility with an aggregate commitment of $500.0 million. On September 8, 2022, the Company amended and restated the credit facility to, among other things, extend its maturity to September 7, 2023. As of September 30, 2022, there were no amounts outstanding.

At September 30, 2022, the Company had $500.0 million of short-term commercial paper available for issuance under an uncommitted private placement program which has been inactive since 2012.

At September 30, 2022, Franklin’s outstanding senior unsecured unsubordinated notes had an aggregate principal amount due of $1,600.0 million. The notes have fixed interest rates with interest payable semi-annually.

At September 30, 2022, Legg Mason’s outstanding senior unsecured unsubordinated notes had an aggregate principal amount due of $1,250.0 million. The notes have fixed interest rates with interest payable semi-annually. Effective August 2, 2021, Franklin agreed to unconditionally and irrevocably guarantee all of the outstanding notes issued by Legg Mason.

The Franklin and Legg Mason senior notes contain an optional redemption feature that allows the Company to redeem each series of notes prior to maturity in whole or in part at any time, at a make-whole redemption price. The indentures governing the senior notes contain limitations on the Company’s ability and the ability of its subsidiaries to pledge voting stock or profit participating equity interests in its subsidiaries to secure other debt without similarly securing the notes equally and ratably. In addition, the indentures include requirements that must be met if the Company consolidates or merges with, or sells all or substantially all of its assets to, another entity. The 364-day revolving credit facility and term loan credit agreement contain a financial performance covenant requiring that the Company maintains a consolidated net leverage ratio, measured as of the last day of each fiscal quarter, of no greater than 3.00 to 1.00. The Company was in compliance with all covenants at September 30, 2022.