Borrowings

Notes Payable and Short-Term Borrowings

Notes payable and short-term borrowings, including the current portion of long-term debt, were as follows:



	As of October 31,
	2018				2017
	Amount Outstanding		Weighted-Average Interest Rate		Amount Outstanding		Weighted-Average Interest Rate
	Dollars in millions
Current portion of long-term debt	$	1,196	2.2	%	$	3,005	3.2	%
FS Commercial paper	392		(0.2	)%	401		(0.1	)%
Notes payable to banks, lines of credit and other⁽¹⁾	417		2.5	%	444		1.8	%
Total notes payable and short-term borrowings	$	2,005			$	3,850


(1)	Notes payable to banks, lines of credit and other includes $361 million and $390 million at October 31, 2018 and 2017, respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries.

Long-Term Debt



	As of October 31,
	2018			2017
	In millions
Hewlett Packard Enterprise Senior Notes
$2,650 issued at discount to par at a price of 99.872% in October 2015 at 2.85%, due October 5, 2018, interest payable semi-annually on April 5 and October 5 of each year	$	—		$	2,648
$250 issued at par in October 2015 at three-month USD LIBOR plus 1.93%, due October 5, 2018, interest payable quarterly on January 5, April 5, July 5 and October 5 of each year	—			250
$1,100 issued at discount to par at a price of 99.994% in September 2017 at 2.10%, due October 4, 2019, interest payable semi-annually on April 4 and October 4 of each year	1,100			1,100
$3,000 issued at discount to par at a price of 99.972% in October 2015 at 3.6%, due October 15, 2020, interest payable semi-annually on April 15 and October 15 of each year	3,000			3,000
$500 issued at discount to par at a price of 99.861% in September 2018 at 3.5%, due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year	499			—
$800 issued at par in September 2018 at three-month USD LIBOR plus 0.72% due October 5, 2021, interest payable semi-annually on April 5 and October 5 of each year	800			—
$1,350 issued at discount to par at a price of 99.802% in October 2015 at 4.4%, due October 15, 2022, interest payable semi-annually on April 15 and October 15 of each year	1,348			1,348
$2,500 issued at discount to par at a price of 99.725% in October 2015 at 4.9%, due October 15, 2025, interest payable semi-annually on April 15 and October 15 of each year	2,495			2,495
$750 issued at discount to par at a price of 99.942% in October 2015 at 6.2%, due October 15, 2035, interest payable semi-annually on April 15 and October 15 of each year	750			750
$1,500 issued at discount to par at a price of 99.932% in October 2015 at 6.35%, due October 15, 2045, interest payable semi-annually on April 15 and October 15 of each year	1,499			1,499
Other, including capital lease obligations, at 0.00%-4.91%, due in calendar years 2018-2030⁽¹⁾	236			286
Fair value adjustment related to hedged debt	(353		)	(142		)
Unamortized debt issuance costs	(42		)	(47		)
Less: current portion	(1,196		)	(3,005		)
Total long-term debt	$	10,136		$	10,182

(1)

Other, including capital lease obligations includes $131 million and $160 million as of October 31, 2018 and 2017, respectively, of borrowing- and funding-related activity associated with FS and its subsidiaries that are collateralized by receivables and underlying assets associated with the related capital and operating leases. For both the periods presented, the carrying amount of the assets approximated the carrying amount of the borrowings.

Interest expense on borrowings recognized in the Consolidated Statements of Earnings was as follows:



		Fiscal years ended October 31,
Expense	Location	2018		2017		2016
		In millions
Financing interest	Financing interest	$	278	$	265	$	249
Interest expense	Interest and other, net	353		334		298
Total interest expense		$	631	$	599	$	547

Hewlett Packard Enterprise Senior Notes

On September 19, 2018, the Company completed its offering of $1.3 billion of Senior Notes due October 5, 2021. The issuance consisted of $800 million floating rate Notes at three month USD LIBOR plus 0.72%, and $500 million fixed rate Notes at 3.50%. The net proceeds from this offering were used to fund the repayment of the $1.05 billion outstanding principal amount of the 2.85% Notes and the $250 million outstanding principal amount of the floating rate Notes that both were due in October 2018, and for general corporate purposes.

On June 29, 2018, the Company redeemed $1.6 billion of its $2.65 billion Senior Notes with an original maturity date of October 5, 2018. These notes were fully hedged with interest rate swaps. As part of the transaction, HPE terminated and settled a proportional amount of the hedges, as well as allocated a proportional amount of unamortized discount and debt issuance costs to the retired debt. These costs, along with the redemption price of $1.6 billion resulted in an immaterial loss.

On September 20, 2017, Hewlett Packard Enterprise completed its offering of $1.1 billion of new 2.100% registered Notes due October 4, 2019. The Company used the net proceeds to fund the repayment of the remaining $750 million outstanding principal amount of its 2.450% Notes due October 5, 2017 and the repayment of the $350 million outstanding principal amount of its floating rate Notes due October 5, 2017.

On April 28, 2017, the Company used a portion of the $3.0 billion cash dividend received from Everett to redeem $1.5 billion face value of the 2.450% Senior Notes with an original maturity date of October 5, 2017. A proportional amount of unamortized discount and debt issuance costs were allocated to the retired debt. These costs, along with the redemption price of $1.5 billion resulted in an immaterial loss.

On December 30, 2016, Hewlett Packard Enterprise exchanged new registered Notes for all of the outstanding $14.6 billion of unregistered Senior Notes. The terms of the new registered Notes in the exchange offer were substantially identical to the terms of the previously unregistered Senior Notes, except that the new Notes were registered under the Securities Act, and certain transfer restrictions, registration rights and additional interest provisions relating to the outstanding Senior Notes do not apply to the new Notes.

As disclosed in Note 14, "Financial Instruments", the Company uses interest rate swaps to mitigate the exposure of its debt portfolio to changes in fair value resulting from changes in interest rates by achieving a primarily U.S. dollar LIBOR-based floating interest rate. As of October 31, 2018, the Company had entered into interest rate swaps to reduce the exposure of $6.9 billion of aggregate principal amount of fixed rate Senior Notes to changes in fair value resulting from changes in interest rates by achieving LIBOR-based floating interest rate. Interest rates on long-term debt in the table above have not been adjusted to reflect the impact of any interest rate swaps.

Commercial Paper

Hewlett Packard Enterprise's Board of Directors has authorized the issuance of up to $4.0 billion in aggregate principal amount of commercial paper by Hewlett Packard Enterprise. Hewlett Packard Enterprise's subsidiaries are authorized to issue up to an additional $500 million in aggregate principal amount of commercial paper. Hewlett Packard Enterprise maintains two commercial paper programs, and a wholly-owned subsidiary maintains a third program. Hewlett Packard Enterprise's U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $4.0 billion. Hewlett Packard Enterprise's euro commercial paper program provides for the issuance of commercial paper outside of the U.S. denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $4.0 billion authorized by Hewlett Packard Enterprise's Board of Directors. The Hewlett Packard Enterprise subsidiary's euro Commercial Paper/Certificate of Deposit Program provides for the issuance of commercial paper in various currencies of up to a maximum aggregate principal amount of $500 million. As of October 31, 2018 and 2017, no borrowings were outstanding under Hewlett Packard Enterprise’s two commercial paper programs, and $392 million and $401 million, respectively, were outstanding under the subsidiary’s program.

Revolving Credit Facility

On November 1, 2015, the Company entered into a revolving credit facility (the "Credit Agreement"), together with the lenders named therein, JPMorgan Chase Bank, N.A. ("JPMorgan"), as co-administrative agent and administrative processing agent, and Citibank, N.A., as co-administrative agent, providing for a senior, unsecured revolving credit facility with aggregate lending commitments of $4.0 billion. Loans under the revolving credit facility may be used for general corporate purposes. Commitments under the Credit Agreement are available for a period of five years, which period may be extended, subject to satisfaction of certain conditions, by up to two, one-year periods. Commitment Fees, interest rates and other terms of borrowing under the credit facility vary based on Hewlett Packard Enterprise's external credit rating. As of October 31, 2018 and 2017, no borrowings were outstanding under the Credit Agreement.

Future Maturities of Long-term Debt

As of October 31, 2018, aggregate future maturities of the Company's long-term debt at face value (excluding a fair value adjustment related to hedged debt of $353 million and a net discount on debt issuance of $9 million), including capital lease obligations were as follows:



Fiscal year	In millions
2019	$	1,201
2020	3,021
2021	1,344
2022	1,363
2023	16
Thereafter	4,791
Total	$	11,736