NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORP /DC/NRUC
NATIONAL RURAL UTILITIES COOPERATIVE FINANCE CORP /DC/ Debt Disclosure
NOTE 7—LONG-TERM DEBT | ||
The following table displays, by debt product type, long-term debt outstanding, and the weighted-average interest rate and maturity date as of May 31, 2023 and 2022. Long-term debt outstanding totaled $23,947 million and accounted for 77% of total debt outstanding as of May 31, 2023, compared with $21,545 million and 75% of total debt outstanding as of May 31, 2022. Long-term debt with fixed- and variable-interest rate accounted for 93% and 7%, respectively, of our total long-term debt outstanding as of May 31, 2023, compared with 90% and 10%, respectively, of our total long-term debt outstanding as of May 31, 2022.
Table 7.1: Long-Term Debt—Debt Product Types and Weighted-Average Interest Rates
| May 31, | ||||||||||||||||||||||||||||||||||||||
| 2023 | 2022 | |||||||||||||||||||||||||||||||||||||
| (Dollars in thousands) | Amount | Weighted- Average Interest Rate | Maturity Date | Amount | Weighted- Average Interest Rate | Maturity Date | ||||||||||||||||||||||||||||||||
| Secured long-term debt: | ||||||||||||||||||||||||||||||||||||||
| Collateral trust bonds | $ | 7,792,711 | 3.46 | % | 2023-2049 | $ | 7,097,711 | 3.17 | % | 2023-2049 | ||||||||||||||||||||||||||||
| Unamortized discount, net | (178,832) | (216,608) | ||||||||||||||||||||||||||||||||||||
| Debt issuance costs | (35,906) | (32,613) | ||||||||||||||||||||||||||||||||||||
| Total collateral trust bonds | 7,577,973 | 6,848,490 | ||||||||||||||||||||||||||||||||||||
| Guaranteed Underwriter Program notes payable | 6,720,643 | 3.09 | 2025-2053 | 6,105,473 | 2.69 | 2025-2052 | ||||||||||||||||||||||||||||||||
| Farmer Mac notes payable | 3,149,898 | 3.92 | 2023-2049 | 3,094,679 | 2.33 | 2022-2049 | ||||||||||||||||||||||||||||||||
| Other secured notes payable | 1,098 | 3.06 | 2023 | 2,755 | 3.10 | 2022-2023 | ||||||||||||||||||||||||||||||||
| Debt issuance costs | (2) | (9) | ||||||||||||||||||||||||||||||||||||
| Total other secured notes payable | 1,096 | 2,746 | ||||||||||||||||||||||||||||||||||||
| Total secured notes payable | 9,871,637 | 9,202,898 | ||||||||||||||||||||||||||||||||||||
| Total secured long-term debt | 17,449,610 | 3.40 | 16,051,388 | 2.83 | ||||||||||||||||||||||||||||||||||
| Unsecured long-term debt: | ||||||||||||||||||||||||||||||||||||||
| Medium-term notes sold through dealers | 6,152,726 | 3.52 | 2023-2037 | 5,263,496 | 2.20 | 2022-2032 | ||||||||||||||||||||||||||||||||
| Medium-term notes sold to members | 365,260 | 3.98 | 2023-2037 | 250,397 | 2.70 | 2022-2037 | ||||||||||||||||||||||||||||||||
| Medium-term notes sold through dealers and to members | 6,517,986 | 3.55 | 5,513,893 | 2.22 | ||||||||||||||||||||||||||||||||||
| Unamortized premium (discount), net | 4 | (2,086) | ||||||||||||||||||||||||||||||||||||
| Debt issuance costs | (21,122) | (19,723) | ||||||||||||||||||||||||||||||||||||
| Total unsecured medium-term notes | 6,496,868 | 5,492,084 | ||||||||||||||||||||||||||||||||||||
| Unsecured notes payable | 71 | — | 2023 | 1,979 | — | 2022-2023 | ||||||||||||||||||||||||||||||||
| Unamortized discount | (1) | (10) | ||||||||||||||||||||||||||||||||||||
Debt issuance costs | — | (1) | ||||||||||||||||||||||||||||||||||||
| Total unsecured notes payable | 70 | 1,968 | ||||||||||||||||||||||||||||||||||||
| Total unsecured long-term debt | 6,496,938 | 3.55 | 5,494,052 | 2.22 | ||||||||||||||||||||||||||||||||||
| Total long-term debt | $ | 23,946,548 | 3.44 | $ | 21,545,440 | 2.68 | ||||||||||||||||||||||||||||||||
The following table presents the principal amount of long-term debt maturing in each of the five fiscal years subsequent to May 31, 2023 and thereafter.
Table 7.2: Long-Term Debt—Maturities and Weighted-Average Interest Rates
| (Dollars in thousands) | Maturity Amount | Weighted-Average Interest Rate | ||||||||||||
| 2024 | $ | 2,277,050 | 3.00 | % | ||||||||||
| 2025 | 2,286,088 | 2.73 | ||||||||||||
| 2026 | 3,527,228 | 3.77 | ||||||||||||
| 2027 | 1,631,434 | 2.11 | ||||||||||||
| 2028 | 2,156,615 | 3.74 | ||||||||||||
| Thereafter | 12,303,992 | 3.68 | ||||||||||||
| Total | $ | 24,182,407 | 3.44 | |||||||||||
Secured Debt
Long-term secured debt of $17,450 million and $16,051 million as of May 31, 2023 and 2022, respectively, represented 73% and 75% of total long-term debt outstanding as of each respective date. We discuss below our long-term secured debt types and the activity during fiscal year 2023. We were in compliance with all covenants and conditions under our secured debt indentures as of May 31, 2023 and 2022. We are required to pledge eligible mortgage notes in an amount at least equal to the outstanding balance of our secured debt. See “Note 4—Loans” for information on pledged collateral under our secured debt agreements.
Collateral Trust Bonds
Collateral trust bonds represent secured obligations sold to investors in the capital markets. Collateral trust bonds are secured by the pledge of mortgage notes or eligible securities in an amount at least equal to the principal balance of the bonds outstanding. We issued aggregate principal amount of collateral trust bonds totaling $1,050 million with an average fixed interest rate of 5.17% and an average term of 10 years during fiscal year 2023.
Guaranteed Underwriter Program Notes Payable
We borrowed $800 million and repaid $185 million of notes payable outstanding under the Guaranteed Underwriter Program during fiscal year 2023. We had up to $1,025 million available for access under the Guaranteed Underwriter Program as of May 31, 2023. On December 15, 2022, we closed on a $750 million committed loan facility (“Series T”) from the Federal Financing Bank under the Guaranteed Underwriter Program. Pursuant to this facility, we may borrow any time before July 15, 2027. Each advance is subject to quarterly amortization and a final maturity not longer than 30 years from the date of the advance.
The notes outstanding under the Guaranteed Underwriter Program contain a provision that if during any portion of the fiscal year, our senior secured credit ratings do not have at least two of the following ratings: (i) A3 or higher from Moody’s, (ii) A- or higher from S&P, (iii) A- or higher from Fitch or (iv) an equivalent rating from a successor rating agency to any of the above rating agencies, we may not make cash patronage capital distributions in excess of 5% of total patronage capital. We are required to pledge eligible distribution system or power supply system loans as collateral in an amount at least equal to the total principal amount of notes outstanding under the Guaranteed Underwriter Program.
Farmer Mac Notes Payable
We have a revolving note purchase agreement with Farmer Mac, under which we can borrow up to $6,000 million from Farmer Mac, at any time, subject to market conditions through June 30, 2027. The agreement has successive automatic one-year renewals beginning June 30, 2026, unless Farmer Mac provides 425 days’ written notice of non-renewal. Pursuant to this revolving note purchase agreement, we can borrow, repay and re-borrow funds at any time through maturity, as market conditions permit, provided that the outstanding principal amount at any time does not exceed the total available under the agreement. Each borrowing under the revolving note purchase agreement is evidenced by a pricing agreement setting forth the interest rate, maturity date and other related terms as we may negotiate with Farmer Mac at the time of each such borrowing. We may select a fixed rate or variable rate at the time of each advance with a maturity as determined in the applicable pricing agreement. The amount outstanding under this agreement included $3,150 million of long-term debt as of May 31, 2023. We borrowed and repaid $500 million in short-term notes payable and borrowed $550 million in long-term notes payable under the note purchase agreement with Farmer Mac during fiscal year 2023. The amount available for borrowing totaled $2,850 million as of May 31, 2023.
Unsecured Debt
Long-term unsecured debt of $6,497 million and $5,494 million as of May 31, 2023 and 2022, respectively, represented 27% and 25% of total long-term debt outstanding as of each respective date. The increase in long-term unsecured debt of $1,003 million for fiscal year 2023 was primarily attributable to dealer medium-term notes issuance, as described below, partially offset by dealer medium-term notes repayments.
Medium-Term Notes
Medium-term notes represent unsecured obligations that may be issued through dealers in the capital markets or directly to our members. We issued aggregate principal amount of dealer medium-term notes totaling $1,700 million with an average fixed interest rate of 4.87% and an average term of four years during the year ended May 31, 2023. Subsequent to the year ended May 31, 2023, we issued $400 million aggregate principal amount of dealer medium-term notes at a fixed rate of 5.05% due on September 15, 2028.Free Sentinel
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2023 | Aug 2, 2023 | Showing above |
| 2022 | Aug 8, 2022 | |
| 2020 | Aug 5, 2020 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.