HARVARD University, the world's richest college, is raising as much as US$2.5 billion from sales of taxable and non-taxable bonds to repay debt and terminate an interest-rate swap agreement.

Harvard sold US$1.5 billion in taxable bonds, according to data compiled by Bloomberg News, and the university plans an offering of US$1 billion in tax-exempt securities, Standard & Poor's said.

The long-term bonds, with maturities as long as 30 years, will replace commercial paper sold to finance the Cambridge, Massachusetts-based school's "very ambitious" capital plan, and end a swap, S&P said.

S&P, which is based in New York, rates Harvard AAA and said in a report that its only credit concern was if the school issued "significant additional debt" amid "a declining investment market."

John Longbrake, a Harvard spokesman, confirmed the school will sell at least US$600 million in tax-exempt securities.

The school is expanding its campus in neighboring Allston across the Charles River. Harvard's endowment decreased 22 percent, or US$8 billion, in the first four months of fiscal 2009, putting it on course for its worst performance in at least four decades.