XML 30 R17.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Long-Term Debt | 9 Months Ended
--- | ---
Sep. 30, 2016
Debt Disclosure [Abstract] |
Long-Term Debt | Long-Term Debt Long-term debt consisted of the following (in millions):
| September 30, 2016 |  | December 31, 2015
| Principal |  | Discount and Issue Costs |  | Carrying Value |  | Principal |  | Discount and Issue Costs |  | Carrying Value
Direct Senior Obligations of AFG: |  |  |  |  |  |  |  |  |  |  |
9-7/8% Senior Notes due June 2019 | $ | 350 |  |  | $ | (1 | ) |  | $ | 349 |  |  | $ | 350 |  |  | $ | (1 | ) |  | $ | 349 |
3-1/2% Senior Notes due August 2026 | 300 |  |  | (4 | ) |  | 296 |  |  | — |  |  | — |  |  | — |
6-3/8% Senior Notes due June 2042 | 230 |  |  | (7 | ) |  | 223 |  |  | 230 |  |  | (7 | ) |  | 223 |
5-3/4% Senior Notes due August 2042 | 125 |  |  | (4 | ) |  | 121 |  |  | 125 |  |  | (4 | ) |  | 121 |
Other | 3 |  |  | — |  |  | 3 |  |  | 3 |  |  | — |  |  | 3 |
| 1,008 |  |  | (16 | ) |  | 992 |  |  | 708 |  |  | (12 | ) |  | 696 |
Direct Subordinated Obligations of AFG: |  |  |  |  |  |  |  |  |  |  |
6-1/4% Subordinated Debentures due September 2054 | 150 |  |  | (5 | ) |  | 145 |  |  | 150 |  |  | (5 | ) |  | 145 |
6% Subordinated Debentures due November 2055 | 150 |  |  | (5 | ) |  | 145 |  |  | 150 |  |  | (5 | ) |  | 145 |
| 300 |  |  | (10 | ) |  | 290 |  |  | 300 |  |  | (10 | ) |  | 290 |
Subsidiaries: |  |  |  |  |  |  |  |  |  |  |
National Interstate bank credit facility | 18 |  |  | — |  |  | 18 |  |  | 12 |  |  | — |  |  | 12 |
| $ | 1,326 |  |  | $ | (26 | ) |  | $ | 1,300 |  |  | $ | 1,020 |  |  | $ | (22 | ) |  | $ | 998 |
To achieve a desired balance between fixed and variable rate debt, AFG entered into an interest rate swap in June 2015, which effectively converts its 9-7/8% Senior Notes to a floating rate of three-month LIBOR plus 8.099% (8.9493% at September 30, 2016 and 8.6110% at December 31, 2015). The fair value of the interest rate swap (asset of $6 million and $2 million at September 30, 2016 and December 31, 2015, respectively) and the offsetting adjustment to the carrying value of the notes are both included in the carrying value of the 9-7/8% Senior Notes in the table above. Scheduled principal payments on debt for the balance of 2016, the subsequent five years and thereafter were as follows: 2016 — $18 million; 2017 — none; 2018 — none; 2019 — $350 million; 2020 — none; 2021 — none and thereafter — $958 million. As shown below (principal amount, in millions), the majority of AFG’s long-term debt is unsecured obligations of the holding company and its subsidiaries:
| September 30, 2016 |  | December 31, 2015
Senior unsecured obligations | $ | 1,026 |  |  | $ | 720 |
Subordinated unsecured obligations | 300 |  |  | 300 |
| $ | 1,326 |  |  | $ | 1,020 |
In August 2016, AFG issued $300 million in 3-1/2% Senior Notes due in 2026 at a price of 99.608%. The net proceeds of the offering will be used to fund a portion of the proposed acquisition of all shares of National Interstate Corporation common stock that are not currently owned by AFG (discussed in Note B — “Acquisition and Sale of Businesses”). In June 2016, AFG replaced its existing credit facility with a new five-year, $500 million revolving credit facility which expires in June 2021. Amounts borrowed under this agreement bear interest at rates ranging from 1.00% to 1.875% (currently 1.375%) over LIBOR based on AFG’s credit rating. No amounts were borrowed under this facility at September 30, 2016 or AFG’s previous credit facility at December 31, 2015. National Interstate can borrow up to $100 million under its unsecured credit agreement, which expires in November 2017. At September 30, 2016, there was $18 million outstanding under this agreement, including $6 million borrowed in September 2016. If the National Interstate merger (discussed in Note B — “Acquisition and Sale of Businesses”) is consummated following the November 10, 2016 NATL shareholders’ meeting, the entire amount outstanding under this agreement will be repaid and the credit agreement will be terminated. This expected repayment is reflected in the scheduled principal payments information presented above.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
Name: | us-gaap_LongTermDebtTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration