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Derivative Financial Instruments
3 Months Ended
May 04, 2013
Derivative Financial Instruments  
Derivative Financial Instruments

5. Derivative Financial Instruments

 

Historically our derivative instruments have primarily consisted of interest rate swaps used to mitigate interest rate risk. We have counterparty credit risk with large global financial institutions resulting from our derivative instruments. We monitor this concentration of counterparty credit risk on an ongoing basis. See Note 3 for a description of the fair value measurement of our derivative instruments and their classification on the Consolidated Statements of Financial Position.

 

As of May 4, 2013 and April 28, 2012, one swap was designated as a fair value hedge for accounting purposes, and no ineffectiveness was recognized during the three months ended May 4, 2013 or April 28, 2012.

 

Periodic payments, valuation adjustments and amortization of gains or losses on our derivative contracts had the following effect on our Consolidated Statements of Operations:

 

Derivative Contracts - Effect on Results of Operations

 

Three Months Ended

 

(millions)

 

 

 

May 4,

 

April 28,

 

Type of Contract

 

Classification of Income/(Expense)

 

2013

 

2012

 

Interest rate swaps

 

Net interest expense

 

  $

8

 

$

10

 

 

The amount remaining on unamortized hedged debt valuation gains from terminated or de-designated interest rate swaps that will be amortized into earnings over the remaining lives of the underlying debt totaled $69 million, $75 million and $102 million, at May 4, 2013, February 2, 2013 and April 28, 2012, respectively.