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Borrowings | 3 Months Ended
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Mar. 31, 2017
Debt Disclosure [Abstract] |
Borrowings | Borrowings The Partnership borrows and enters into credit agreements for its general operating and investment purposes. The Partnership’s debt obligations consist of the following (Dollars in millions):
| As of March 31, 2017 |  | As of December 31, 2016
| Borrowing Outstanding |  | Carrying Value |  | Borrowing Outstanding |  | Carrying Value
Senior Credit Facility Term Loan Due 5/05/2020 | $ | 25.0 |  |  | $ | 24.7 |  |  | $ | 25.0 |  |  | $ | 24.7 |
CLO Term Loans (See below) | 34.1 |  |  | 34.1 |  |  | 33.8 |  |  | 33.8 |
Euro CLO Financing | 66.1 |  |  | 66.1 |  |  | — |  |  | — |
3.875% Senior Notes Due 2/01/2023 | 500.0 |  |  | 497.3 |  |  | 500.0 |  |  | 497.2 |
5.625% Senior Notes Due 3/30/2043 | 600.0 |  |  | 600.7 |  |  | 600.0 |  |  | 600.7 |
Promissory Note Due 1/01/2022 | 108.8 |  |  | 108.8 |  |  | 108.8 |  |  | 108.8 |
Total debt obligations | $ | 1,334.0 |  |  | $ | 1,331.7 |  |  | $ | 1,267.6 |  |  | $ | 1,265.2 |
Senior Credit Facility As of March 31, 2017, the senior credit facility included $25.0 million in a term loan and $750.0 million in a revolving credit facility. As of March 31, 2017, the term loan and revolving credit facility were scheduled to mature on May 5, 2020. Principal amounts outstanding under the term loan and revolving credit facility accrue interest, at the option of the borrowers, either (a) at an alternate base rate plus an applicable margin not to exceed 0.75%, or (b) at LIBOR plus an applicable margin not to exceed 1.75% (at March 31, 2017, the interest rate was 1.92%). There was no amount outstanding under the revolving credit facility at March 31, 2017. Interest expense under the senior credit facility was not significant for the three months ended March 31, 2017 and 2016. The fair value of the outstanding balances of the term loan and revolving credit facility at March 31, 2017 and December 31, 2016 approximated par value based on current market rates for similar debt instruments and are classified as Level III within the fair value hierarchy. On April 6, 2017, the Partnership borrowed $250.0 million against the $750.0 million revolving credit facility. CLO Term Loans For certain of our CLOs, the Partnership finances a portion of its investment in the CLOs through the proceeds received from term loans with financial institutions. The Partnership's outstanding CLO term loans consist of the following (Dollars in millions):
Formation Date |  | Borrowing Outstanding March 31, 2017 |  |  | Borrowing Outstanding December 31, 2016 |  |  | Maturity Date (2) |  | Interest Rate as of March 31, 2017 |
October 3, 2013 |  | $ | 13.5 |  | (1) |  | $ | 13.2 |  | (1) |  | September 28, 2018 |  | 1.75% | (3)
June 7, 2016 |  | 20.6 |  |  |  | 20.6 |  |  |  | July 15, 2027 |  | 2.82% | (4)
|  | $ | 34.1 |  |  |  | $ | 33.8 |  |  |  |  |  |  |
(1) Original borrowing of €12.6 million. (2) Maturity date is earlier of date indicated or the date that the CLO is dissolved. (3) Incurs interest at EURIBOR plus 1.75%. (4) Incurs interest at the weighted average rate of the underlying senior notes. Interest income on the underlying collateral approximated the amount of interest expense and was not significant for the three months ended March 31, 2017. The CLO term loans are secured by the Partnership's investments in the respective CLO, have a general unsecured interest in the Carlyle entity that manages the CLO, and do not have recourse to any other Carlyle entity. Interest expense on these term loans was not significant for the three months ended March 31, 2017 and 2016. The fair value of the outstanding balance of the CLO term loans at March 31, 2017 approximated par value based on current market rates for similar debt instruments. These CLO term loans are classified as Level III within the fair value hierarchy. In January 2017, the Partnership entered into a master credit agreement with a financial institution under which the financial institution expects to provide term loans to the Partnership for the purchase of eligible interests in CLOs. This master credit agreement is available to the Partnership to purchase up to $100 million of eligible interests in up to five CLOs. This agreement will terminate at the earlier of the last closing of the fifth CLO term loan under this agreement and January 2020. Any term loan to be issued under this master credit agreement will be secured by the Partnership’s investment in the respective CLO as well as any senior management fee and subordinated management fee payable by each CLO. Any term loan will bear interest at LIBOR plus a weighted average spread over LIBOR on the CLO notes and an applicable margin. Interest will be due quarterly. As of March 31, 2017, no term loans had been issued under this master credit agreement. European CLO Financing On February 28, 2017, a subsidiary of the Partnership entered into a financing agreement with several financial institutions under which these financial institutions provided a €61.8 million term loan ($66.1 million at March 31, 2017) to the Partnership. This term loan is secured by the Partnership’s investments in the retained notes in certain European CLOs that were formed in 2014 and 2015. This term loan will mature on the earlier of September 21, 2029 or the date that the certain European CLO retained notes have been redeemed. The Partnership may prepay the term loan in whole or in part at any time after the third anniversary of the date of issuance without penalty. Prepayment of the term loan within the first three years will incur a penalty based on the prepayment amount. Interest on this term loan accrues at EURIBOR plus applicable margins (2.33% at March 31, 2017). Interest expense on this term loan was not significant for the three months ended March 31, 2017. The fair value of the outstanding balance of the term loan at March 31, 2017 approximated par value based on current rates for similar debt instruments. This term loan is classified as Level III within the fair value hierarchy. 3.875% Senior Notes In January 2013, an indirect finance subsidiary of the Partnership issued $500.0 million in aggregate principal amount of 3.875% senior notes due February 1, 2023 at 99.966% of par. Interest is payable semi-annually on February 1 and August 1, beginning August 1, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 30 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date. Interest expense on the notes was $5.0 million for the three months ended March 31, 2017 and 2016. At March 31, 2017 and December 31, 2016, the fair value of the notes, including accrued interest, was approximately $511.7 million and $512.8 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy. 5.625% Senior Notes In March 2013, an indirect finance subsidiary of the Partnership issued $400.0 million in aggregate principal amount of 5.625% senior notes due March 30, 2043 at 99.583% of par. Interest is payable semi-annually on March 30 and September 30, beginning September 30, 2013. This subsidiary may redeem the senior notes in whole at any time or in part from time to time at a price equal to the greater of 100% of the principal amount of the notes being redeemed and the sum of the present values of the remaining scheduled payments of principal and interest on any notes being redeemed discounted to the redemption date on a semi-annual basis at the Treasury rate plus 40 basis points plus accrued and unpaid interest on the principal amounts being redeemed to the redemption date. In March 2014, an indirect finance subsidiary of the Partnership issued $200.0 million of 5.625% Senior Notes due March 30, 2043 at 104.315% of par. These notes were issued as additional 5.625% Senior Notes and are treated as a single class with the already outstanding $400.0 million aggregate principal amount of these senior notes. Interest expense on the notes was $8.4 million for the three months ended March 31, 2017 and 2016. At March 31, 2017 and December 31, 2016, the fair value of the notes, including accrued interest, was approximately $619.3 million and $603.1 million, respectively, based on indicative quotes. The notes are classified as Level II within the fair value hierarchy. Promissory Note On January 1, 2016, the Partnership issued a $120.0 million promissory note to BNRI as a result of a contingent consideration arrangement entered into in 2012 between the Partnership and BNRI as part of the Partnership's strategic investment in NGP (see Note 5). Interest on the promissory note accrues at the three month LIBOR plus 2.50% (3.65% at March 31, 2017). The Partnership may prepay the promissory note in whole or in part at any time without penalty. The promissory note is scheduled to mature on January 1, 2022. Interest expense on the promissory note was not significant for the three months ended March 31, 2017 and 2016. The fair value of the outstanding balance of the promissory note at March 31, 2017 approximated par value based on current market rates for similar debt instruments and is classified as Level III within the fair value hierarchy. In December 2016, the Partnership repurchased $11.2 million of the promissory note for a purchase price of approximately $9.0 million. Approximately $108.8 million of the promissory note is outstanding at March 31, 2017 and December 31, 2016. Debt Covenants The Partnership is subject to various financial covenants under its loan agreements including, among other items, maintenance of a minimum amount of management fee-earning assets. The Partnership is also subject to various non-financial covenants under its loan agreements and the indentures governing its senior notes. The Partnership was in compliance with all financial and non-financial covenants under its various loan agreements as of March 31, 2017. The consolidated real estate VIE was not in compliance with the debt covenants related to substantially all of its loans payable as of March 31, 2017 (see Note 16); such violations do not cause a default or event of default under the Partnership’s senior credit facility, CLO term loans, senior notes, or the loans payable of Consolidated Funds. Loans Payable of Consolidated Funds Loans payable of Consolidated Funds primarily represent amounts due to holders of debt securities issued by the CLOs. Several of the CLOs issued preferred shares representing the most subordinated interest, however these tranches are mandatorily redeemable upon the maturity dates of the senior secured loans payable, and as a result have been classified as liabilities and are included in loans payable of Consolidated Funds in the condensed consolidated balance sheets. As of March 31, 2017 and December 31, 2016, the following borrowings were outstanding, which includes preferred shares classified as liabilities (Dollars in millions):
| As of March 31, 2017
| Borrowing Outstanding |  | Fair Value |  | Weighted Average Interest Rate |  |  |  | Weighted Average Remaining Maturity in Years
Senior secured notes | $ | 3,371.0 |  |  | $ | 3,384.2 |  |  | 2.43 | % |  |  |  | 11.05
Subordinated notes, preferred shares and other | 224.1 |  |  | 203.3 |  |  | N/A |  |  | (a) |  | 8.94
Total | $ | 3,595.1 |  |  | $ | 3,587.5 |  |  |  |  |  |  |
| As of December 31, 2016
| Borrowing Outstanding |  | Fair Value |  | Weighted Average Interest Rate |  |  |  | Weighted Average Remaining Maturity in Years
Senior secured notes | $ | 3,681.0 |  |  | $ | 3,672.5 |  |  | 2.45 | % |  |  |  | 10.22
Subordinated notes, preferred shares and other | 195.6 |  |  | 193.8 |  |  | N/A |  |  | (a) |  | 9.26
Total | $ | 3,876.6 |  |  | $ | 3,866.3 |  |  |  |  |  |  |
(a) | The subordinated notes and preferred shares do not have contractual interest rates, but instead receive distributions from the excess cash flows of the CLOs.
Loans payable of the CLOs are collateralized by the assets held by the CLOs and the assets of one CLO may not be used to satisfy the liabilities of another. This collateral consisted of cash and cash equivalents, corporate loans, corporate bonds and other securities. As of March 31, 2017 and December 31, 2016, the fair value of the CLO assets was $4.3 billion and $4.7 billion, respectively.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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