NOTES PAYABLE

A summary of notes payable follows:



(In millions)	September 30, 2015				December 31, 2014
3.45% senior notes paid August 2015		$	0			$	300
2.65% senior notes due February 2017		652		⁽¹⁾		653		⁽¹⁾
8.50% senior notes due May 2019		0		⁽²⁾		850
2.40% senior notes due March 2020		550				0
4.00% senior notes due February 2022		350		⁽³⁾		350		⁽³⁾
3.625% senior notes due June 2023		700				700
3.625% senior notes due November 2024		749		⁽³⁾		749		⁽³⁾
3.25% senior notes due March 2025		448		⁽³⁾		0
6.90% senior notes due December 2039		397		⁽³⁾		397		⁽³⁾
6.45% senior notes due August 2040		448		⁽³⁾		448		⁽³⁾
5.50% subordinated debentures due September 2052		500				500
Yen-denominated Uridashi notes:
2.26% notes due September 2016 (principal amount 8 billion yen)		67				66
Yen-denominated Samurai notes:
1.84% notes due July 2016 (principal amount 15.8 billion yen)		132				131
Yen-denominated loans:
3.60% loan paid July 2015 (principal amount 10 billion yen)		0				83
3.00% loan paid August 2015 (principal amount 5 billion yen)		0				41
Capitalized lease obligations payable through 2022		16				14
Total notes payable		$	5,009			$	5,282

⁽¹⁾Principal amount plus an issuance premium that is being amortized over the life of the notes

⁽²⁾Redeemed in April 2015

⁽³⁾Principal amount net of an issuance discount that is being amortized over the life of the notes

In August 2015, we paid off $300 million of 3.45% fixed-rate senior notes upon their maturity. In August 2015, we paid off a 5.0 billion yen loan at its maturity date (a total of approximately $41 million using the exchange rate at the maturity date). In July 2015, we paid off a 10.0 billion yen loan at its maturity date (a total of approximately $81 million using the exchange rate at the maturity date).

In March 2015, the Parent Company issued two series of senior notes totaling $1.0 billion through a U.S. public debt offering. The first series, which totaled $550 million, bears interest at a fixed rate of 2.40% per annum, payable semi-annually, and has a five-year maturity. The second series, which totaled $450 million, bears interest at a fixed rate of 3.25% per annum, payable semi-annually, and has a ten-year maturity. We have entered into cross-currency swaps that convert the dollar-denominated principal and interest on the senior notes into yen-denominated obligations which results in lower nominal net interest rates on the debt. By entering into these cross-currency swaps, we economically converted our $550 million liability into a 67.0 billion yen liability and reduced the interest rate on this debt from 2.40% in dollars to .24% in yen, and we economically converted our $450 million liability into a 55.0 billion yen liability and reduced the interest rate on this debt from 3.25% in dollars to .82% in yen. In April 2015, the Parent Company used the proceeds from the March 2015 issuance of its fixed-rate senior notes to redeem $850 million of our 8.50% fixed-rate senior notes due May 2019 and to pay a portion of the corresponding $230 million make-whole premium due to the investors of these notes.

In September 2015, we amended and restated our 50.0 billion yen senior unsecured revolving credit facility agreement, due to expire in March 2018, pursuant to which the Parent Company and Aflac jointly entered into a new five-year senior unsecured revolving credit facility agreement with a syndicate of financial institutions that provides for borrowings of up to 55.0 billion yen or the equivalent of yen in U.S. dollars on a revolving basis. This credit agreement provides for borrowings in Japanese yen or the equivalent of Japanese yen in U.S. dollars on a revolving basis. Borrowings bear interest at a rate per annum equal to, at our option, either (a) a eurocurrency rate determined by reference to the London Interbank Offered Rate (LIBOR) for the interest period relevant to such borrowing adjusted for certain additional costs or (b) a base rate determined by reference to the highest of (1) the federal funds effective rate plus ½ of 1%, (2) the rate of interest for such day announced by Mizuho Bank, Ltd. as its prime rate and (3) the eurocurrency rate for an interest period of one month plus 1.00%, in each case plus an applicable margin. The applicable margin ranges between .79% and 1.275% for eurocurrency rate borrowings and 0.0% and .275% for base rate borrowings, depending on the Parent Company’s debt ratings as of the date of determination. In addition, the Parent Company and Aflac are required to pay a facility fee on the commitments ranging between .085% and .225%, also based on the Parent Company’s debt ratings as of the date of determination. Borrowings under the amended and restated credit facility may be used for general corporate purposes, including a capital contingency plan for the operations of the Parent Company and Aflac. The amended and restated credit facility requires compliance with certain financial covenants on a quarterly basis and will expire on the earlier of (a) September 18, 2020, or (b) the date the commitments are terminated pursuant to an event of default, as such term is defined in the credit agreement. As of September 30, 2015, we did not have any borrowings outstanding under our 55.0 billion yen revolving credit agreement.

In February 2015, the Parent Company and Aflac jointly entered into an uncommitted bilateral line of credit with a third party that provides for borrowings in the amount of $50 million. Borrowings will bear interest at the rate quoted by the bank and agreed upon at the time of making such loan and will have a three-month maturity period. There are no related facility fees, upfront expenses or financial covenant requirements. Borrowings under this credit agreement may be used for general corporate purposes. As of September 30, 2015, we did not have any borrowings outstanding under our $50 million credit agreement.

The Parent Company and Aflac have an uncommitted bilateral line of credit that provides for borrowings in the amount of $100 million. Borrowings will bear interest at the rate quoted by the bank and agreed upon at the time of making such loan and will have a three-month maturity period. There are no related facility fees, upfront expense or financial covenant requirements. Borrowings under this credit agreement may be used for general corporate purposes. Borrowings under the financing agreement will mature no later than three months after the last drawdown date of October 15, 2015. As of September 30, 2015, we did not have any borrowings outstanding under our $100 million credit agreement.

We were in compliance with all of the covenants of our notes payable and lines of credit at September 30, 2015. No events of default or defaults occurred during the nine-month period ended September 30, 2015.

For additional information, see Notes 4 and 9 of the Notes to the Consolidated Financial Statements in our annual report to shareholders for the year ended December 31, 2014.