LONG-TERM DEBT
The following schedule presents the components of our long-term debt:
December 31,
(In millions)20252024
Subordinated notes$969 $946 
Senior notes499 — 
Finance lease obligations
Total$1,472 $950 
Long-term debt carrying values include the par value of the debt, adjusted for unamortized premiums or discounts, unamortized debt issuance costs, and fair value hedge basis adjustments. The increase in long-term debt from the prior year was primarily due to the issuance of $500 million in 4.70% Fixed-to-Floating Senior Notes with a maturity date of August 18, 2028, during the third quarter of 2025.
During the fourth quarter of 2024, we entered into a receive-fixed interest rate swap designated as a hedge of the $500 million subordinated notes maturing in November 2035. In 2023, we terminated a receive-fixed interest rate swap that had been designated as a hedge of the $500 million subordinated notes maturing in October 2029. The
remaining unamortized hedge basis adjustment from the terminated hedging relationship continues to be amortized into earnings through the contractual maturity of the hedged notes. The carrying values include any unamortized hedge basis adjustments. For additional information on derivatives designated as qualifying hedges, see Note 7.
Subordinated Notes
The following schedule presents our subordinated notes outstanding at December 31, 2025:
(Dollar amounts in millions)Subordinated notes
Coupon rateCarrying valuePar amountMaturity dateEarliest redemption dateInterest terms
3.25%$466 $500 October 2029July 2029
3.25% fixed; interest payable semi‑annually
6.82%503 500 November 2035November 2034
6.82% fixed-to-floating: interest payable semi‑annually during fixed period; converts in Nov. 2034 to compounded SOFR + 2.83% payable quarterly
Total$969 $1,000 
Senior Notes
The following schedule presents our senior notes outstanding at December 31, 2025:
(Dollar amounts in millions)Senior notes
Coupon rateCarrying valuePar amountMaturity dateEarliest redemption dateInterest terms
4.70%$499 $500 August 2028August 2027
4.70% fixed-to-floating: interest payable semi‑annually during fixed period; converts in Aug. 2027 to compounded SOFR + 1.16% payable quarterly
On February 4, 2026, we issued $500 million of 4.48% Fixed-to-Floating Senior Notes, maturing on February 9, 2029. These notes are unsecured, with interest payable semi-annually during the fixed-rate period; the earliest redemption date for these notes is February 9, 2028, after which the interest rate changes to an annual floating rate equal to compounded SOFR + 1.06%, payable quarterly.
Maturities of Long-term Debt
The following schedule presents the carrying value of our long-term debt by maturity for each of the next five years:
(In millions)20262027202820292030ThereafterTotal
Subordinated notes$— $— $— $466 $— $503 $969 
Senior notes— — 499 — — — 499 
Finance lease obligations— — — — — 
Total$— $— $499 $466 $— $507 $1,472 

Historical Timeline

Fiscal YearFiled
2025Feb 24, 2026Showing above
2024Feb 25, 2025
2023Feb 23, 2024
2022Feb 23, 2023
2021Feb 25, 2022
2020Feb 25, 2021
2019Feb 26, 2020
2018Feb 26, 2019
2017Mar 1, 2018
2016Feb 28, 2017
2015Feb 29, 2016

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.