EBay credit agreement $160 mln lower due to Lehman

SAN FRANCISCO, Oct 23  - EBay Inc's available line of credit in its $2.0 billion credit agreement shrunk by $160 million due to the recent bankruptcy of participating lender Lehman Brothers Commercial Bank, the online auctioneer said on Thursday in a regulatory filing.

Subsequently, the company drew down $1.0 billion under the revolving credit facility to be used for general corporate needs, including recent acquisitions.

"We are not aware of any lack of access to the remaining $840M under the line of credit; however, we can provide no assurance that access to the remaining available line of credit will not be impacted by adverse conditions in the financial markets," eBay said in its quarterly report for the period ended Sept. 30 filed with the U.S. Securities & Exchange Commission.

In a sign of the times, with the prospect of a recession now near certainty, EBay's quarterly report also contained a warning included in its "Risk Factors" about the possibility of an economic recession harming the business. The company's second-quarter report did not include such a warning.

"An economic downturn would likely reduce the volume of purchases on our Marketplaces platforms and the volume of transactions paid for using our PayPal payment service and adversely affect our business. In addition, an economic downturn would likely require us to increase our reserves for bad debt and PayPal transaction loss," the company said in the filing.

EBay has long characterized its business as resilient to downturns, given the deals that can be found on its auction site. But last week, the company acknowledged "a high degree of economic uncertainty and turmoil in the business market" that was hurting its business and it lowered its revenue and earnings outlook. (Reporting by Alexandria Sage)