Ameriprise Financial, Inc. (AMP, Financial) has announced the entry into a Fifth Amended and Restated Credit Agreement, enhancing its financial flexibility with a substantial unsecured revolving credit facility. The agreement, effective November 25, 2024, involves key financial institutions including Wells Fargo Bank, National Association as Administrative Agent, and other prominent banks as co-syndication and co-documentation agents.
The Restated Credit Agreement supersedes the previous fourth amended agreement from June 11, 2021, and provides Ameriprise Financial with an aggregate principal commitment amount of up to $1 billion. The company retains the option to increase this amount to $1.250 billion, contingent upon meeting specific conditions. This facility is designed to support Ameriprise's working capital and general corporate purposes, allowing for borrowing in multiple currencies including Dollars, Euros, and Yen.
Interest rates under this facility are tied to market rates plus a margin that varies with the company's senior unsecured long-term debt rating. Additionally, Ameriprise will incur a quarterly facility fee on the total commitments, regardless of usage.
The agreement includes customary financial covenants, requiring Ameriprise to maintain an interest coverage ratio above 4.00 to 1.00 and a consolidated leverage ratio not exceeding 3.25 to 1.00, with provisions for temporary adjustments following significant acquisitions. The facility is set to expire on November 23, 2029, with potential extensions available.
This strategic financial arrangement underscores Ameriprise Financial's commitment to maintaining robust liquidity and operational flexibility, positioning the company for continued growth and stability in the financial services sector.
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