(17)	Notes payable and other borrowings

Notes payable and other borrowings are summarized below (in millions). The weighted average interest rates and maturity date ranges shown in the following tables are based on borrowings as of December 31, 2018.

 

		Weighted Average Interest Rate				December 31,
						2018				2017
Insurance and other:
Berkshire Hathaway Inc. (“Berkshire”):
U.S. Dollar denominated borrowings due 2019-2047			3.1%			$	9,065			$	10,603
Euro denominated borrowings due 2020-2035			1.1%				7,806				8,164
Berkshire Hathaway Finance Corporation (“BHFC”) due 2019-2048			3.4%				10,650				12,926
Subsidiary borrowings due 2019-2045			4.0%				5,597				6,884
Short-term subsidiary borrowings			4.3%				1,857				1,832
						$	34,975			$	40,409

The carrying value of Berkshire’s Euro denominated senior notes reflects the Euro/U.S. Dollar exchange rate as of the balance sheet date. The gains or losses arising from the changes in the Euro/U.S. Dollar exchange rate during the period are recorded in earnings as a component of selling, general and administrative expenses. Changes in the Euro/U.S. Dollar exchange rate resulted in pre-tax gains of $366 million in 2018, losses of $990 million in 2017 and gains of $264 million in 2016. The carrying values of the Euro denominated senior notes reflected corresponding decreases with respect to the gains and increases with respect to the losses in those periods.

 

Borrowings of BHFC, a wholly owned finance subsidiary of Berkshire, consist of senior unsecured notes used to fund manufactured housing loans originated or acquired and equipment held for lease of certain finance subsidiaries. In August 2018, BHFC issued $2.35 billion of 4.2% senior notes due in 2048. During 2018, BHFC repaid $4.6 billion of maturing senior notes. During January 2019, BHFC issued $1.25 billion of 4.25% senior notes due in 2049 and repaid $950 million of maturing notes. Such borrowings are fully and unconditionally guaranteed by Berkshire. In addition to BHFC’s borrowings, Berkshire guaranteed approximately $1.7 billion of other subsidiary borrowings at December 31, 2018. Generally, Berkshire’s guarantee of a subsidiary’s debt obligation is an absolute, unconditional and irrevocable guarantee for the full and prompt payment when due of all payment obligations.

 

		Weighted Average Interest Rate				December 31,
						2018				2017
Railroad, utilities and energy:
Berkshire Hathaway Energy Company (“BHE”) and subsidiaries:
BHE senior unsecured debt due 2020-2049			4.6	%		$	8,577			$	6,452
Subsidiary and other debt due 2019-2064			4.7	%			28,196				28,739
Short-term debt			3.1	%			2,516				4,488
Burlington Northern Santa Fe and subsidiaries due 2019-2097			4.7	%			23,226				22,499
						$	62,515			$	62,178

BHE subsidiary debt represents amounts issued pursuant to separate financing agreements. Substantially all of the assets of certain BHE subsidiaries are, or may be, pledged or encumbered to support or otherwise secure debt. These borrowing arrangements generally contain various covenants, including covenants which pertain to leverage ratios, interest coverage ratios and/or debt service coverage ratios. During 2018, BHE and its subsidiaries issued approximately $5.5 billion of long-term debt. The debt issued in 2018 has maturity dates ranging from 2020 to 2049 and a weighted average interest rate of 3.6%. Proceeds from these debt issuances were used to repay debt, to fund capital expenditures and for general corporate purposes.

BNSF’s borrowings are primarily senior unsecured debentures. In 2018, BNSF issued $1.5 billion of senior unsecured debentures due in 2048. These debentures have a weighted average interest rate of 4.1%. As of December 31, 2018, BNSF, BHE and their subsidiaries were in compliance with all applicable debt covenants. Berkshire does not guarantee any debt, borrowings or lines of credit of BNSF, BHE or their subsidiaries.

As of December 31, 2018, our subsidiaries had unused lines of credit and commercial paper capacity aggregating approximately $7.3 billion to support short-term borrowing programs and provide additional liquidity. Such unused lines of credit included approximately $6.1 billion related to BHE and its subsidiaries.

Debt principal repayments expected during each of the next five years are as follows (in millions).

 

		2019				2020				2021				2022				2023
Insurance and other			$    6,760				$  2,811				$  3,261				$  1,616				$  5,371
Railroad, utilities and energy			5,452				2,778				2,260				3,346				4,066
			$  12,212				$  5,589				$  5,521				$  4,962				$  9,437