Short-Term Borrowings

9 Months Ended

Sep. 30, 2015

Debt Disclosure [Abstract]

Short-Term Borrowings

Short-Term Borrowings

Short-term borrowings represent Jefferies bank loans that are payable on demand and generally bear interest at a spread over the federal funds rate.  Unsecured bank loans are typically overnight loans used to finance trading assets or clearing related balances, but are not part of Jefferies systemic funding model.  At September 30, 2015 and December 31, 2014, $12.0 million and $12.0 million, respectively, was outstanding.  At September 30, 2015, the interest rate on short-term borrowings outstanding is 0.68% per annum.

On April 23, 2015, Jefferies entered into a committed revolving credit facility (“Intraday Credit Facility”) with the Bank of New York Mellon under which, the Bank of New York Mellon has agreed to make revolving intraday credit advances for an aggregate committed amount of $500.0 million in U.S. dollars. The term of the Intraday Credit Facility is six months after the closing date, but can be extended for an additional six months upon our request and at the lender's discretion. The Intraday Credit Facility contains a financial covenant, which includes a minimum regulatory net capital requirement. Interest is based on the higher of the Federal funds effective rate plus 0.5% or the prime rate. At September 30, 2015, Jefferies was in compliance with debt covenants under the Intraday Credit Facility.