Summary
Aflac Incorporated (AFL) has entered into a new 364-day senior unsecured revolving credit facility agreement for ¥50 billion, equivalent to approximately $630 million USD based on recent exchange rates. This facility, established on June 28, 2012, involves a syndicate of financial institutions led by Mizuho Corporate Bank, Ltd. The funds are primarily for general corporate purposes and can be used for a capital contingency plan for Aflac's Japanese operations. This new credit line provides Aflac with financial flexibility and contingency planning capabilities, particularly for its Japanese business. The agreement includes financial covenants related to net worth, statutory surplus, and debt-to-capitalization ratios, along with standard restrictions on liens and mergers. The facility is unsecured, meaning it does not require collateral, and Aflac's payment and performance obligations are guaranteed by its subsidiary, American Family Life Assurance Company of Columbus.
Key Highlights
- 1Aflac secured a ¥50 billion (approx. $630 million USD) 364-day senior unsecured revolving credit facility.
- 2The credit facility is for general corporate purposes, including a capital contingency plan for Japanese operations.
- 3The agreement involves a syndicate of financial institutions with Mizuho Corporate Bank, Ltd. as lead arranger.
- 4The Company's obligations are guaranteed by its subsidiary, American Family Life Assurance Company of Columbus.
- 5The facility contains financial covenants regarding minimum consolidated net worth, statutory surplus, and maximum debt to capitalization ratio.
- 6Customary covenants limit the ability to incur liens, merge, or misuse proceeds, with exceptions noted.
- 7The credit facility expires on June 27, 2013, but may be extended for another 364-day period upon mutual agreement.