It
En19. Loans and borrowings
| 31 December 2016 | 31 December 2015 | |||||
|---|---|---|---|---|---|---|
| Non-current | Current | Total | Non-current | Current | Total | |
| Bonds | 2,660 | 603 | 3,263 | 3,243 | 82 | 3,325 |
| Bank loans and borrowings | 238 | 58 | 296 | 278 | 51 | 329 |
| Related parties loans and borrowings (Note 32) | - | 1,664 | 1,664 | - | 2,983 | 2,983 |
| Other loans and borrowings | 33 | 46 | 79 | - | - | - |
| 2,931 | 2,371 | 5,302 | 3,521 | 3,116 | 6,637 | |
Bonds
Below are the bonded loans in place and listed on the Luxembourg Stock Exchange:
| Year of issue | Maturity | Currency | Outstanding nominal amount (mil.) | Annual coupon | Type of offer | |
|---|---|---|---|---|---|---|
| 2003 | 2018 | € | 500 | 5,750% | (1) | European institutional |
| 2005 | 2025 | € | 500 | 4,875% | European institutional | |
| 2009 | 2019 | GBP | 319 | 8,000% | (2) (3) | European institutional |
| 2009 | 2022 | € | 555 | 5,250% | (3) | European institutional |
| 2012 | 2017 | € | 521 | 4,375% | (3) | European institutional |
| 2013 | 2021 | € | 739 | 4,500% | (3) | European institutional |
(1) Rate derivative transactions were made on these bonds and led the effective cost of the loan to a fixed rate better than the coupon and corresponding to an average of some 5.6%.
(2)The proceeds of the issue were translated into euros and the exchange-rate risk arising from the transaction was fully hedged.
(3) Nominal amounts decreased compared to the value of the original issues following the buy-back transactions.
The main clauses that regulate the Group’s payables are reported in the section “Financial Transactions” of the Report on Operations. Changes in loans and borrowings are as follows:
| 1 January 2016 | Issues | Repayments/Payment of coupons | Effect from mergers/demergers | Other net increase/(decrease) | Exchange differences and other movements | 31 December 2016 | |
|---|---|---|---|---|---|---|---|
| Bonds | 3,325 | - | (173) | - | 173 | (62) | 3,263 |
| Bank loans and borrowings | 329 | - | (48) | 59 | (44) | - | 296 |
| Related-parties loans and borrowings | 2,983 | - | - | (1,048) | (271) | - | 1,664 |
| Other loans and borrowings | - | - | - | 93 | (14) | - | 79 |
| 6,637 | - | (221) | (896) | (156) | (62) | 5,302 |
| 1 January 2015 | Issues | Repayments/Payment of coupons | Effect from mergers/demergers | Other net increase/ (decrease) | Exchange differences and other movements | 31 December 2015 | |
|---|---|---|---|---|---|---|---|
| Bonds | 2,130 | - | (655) | - | 1,813 | 37 | 3,325 |
| Bank loans and borrowings | 374 | - | (45) | - | - | - | 329 |
| Related-parties loans and borrowings | 4,523 | - | - | - | (1,540) | - | 2,983 |
| Other loans and borrowings | - | - | - | - | - | - | - |
| 7,027 | - | (700) | - | 273 | 37 | 6,637 |
Bank loans and borrowings
The item mainly includes the 12-year loan signed with the European Investment Bank (EIB) in 2009 (€mil. 280 at 31 December 2016 compared to €mil. 327 at 31 December 2015) to finance development in the Aeronautics segment. As provided in the loan agreement, €mil. 300 of the loan was originally used at a fixed rate of 3.45% and for €mil. 200 at a floating rate equal to the 6-month Euribor plus a margin of 79.4 basis points. The fixed-rate tranche is repaid in 11 annual instalments with a fixed principal repayment component, while the floating-rate tranche is repaid in 21 6-month instalments, also with a fixed principal repayment component. During the year €mil. 47 was repaid, as in 2015.
Related-party loans and borrowings
Loans and borrowings decrease as a result of the write-off of the Parent Company’s payables to the companies and business units merged.
Other borrowings
The item includes the residual balance of subsidised loans, related to programmes and projects of the companies and business units merged.
Exposure to changes in interest rates of the financial liabilities is as follows:
31 December 2016
| Bonds | Bank loans and borrowings | Related-party loans and borrowings | Other loans and borrowings | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| floating | fixed | floating | fixed | floating | fixed | floating | fixed | floating | fixed | |
| Within 1 year | - | 603 | 28 | 30 | 1,664 | - | 46 | - | 1,738 | 633 |
| 2 to 5 years | - | 1,608 | 82 | 109 | - | - | 28 | 1 | 110 | 1,718 |
| Beyond 5 years | - | 1,052 | 20 | 27 | - | - | 4 | - | 24 | 1,079 |
| Total | - | 3,263 | 130 | 166 | 1,664 | - | 78 | 1 | 1,872 | 3,430 |
31 December 2015
| Bonds | Bank loans and borrowings | Related-partiy loans and borrowings | Other loans and borrowings | Totale | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| floating | fixed | floating | fixed | floating | fixed | floating | fixed | floating | fixed | |
| Within 1 year | - | 82 | 21 | 30 | 2,983 | - | - | - | 3,004 | 112 |
| 2 to 5 years | - | 1,453 | 76 | 109 | - | - | - | - | 76 | 1,562 |
| Beyond 5 years | - | 1,790 | 38 | 55 | - | - | - | - | 38 | 1,845 |
| Total | - | 3,325 | 135 | 194 | 2,983 | - | - | - | 3,118 | 3,519 |
Below is the financial information required under CONSOB communication DEM/6064293 of 28 July 2006:
| 31 December 2016 | Of which with related parties | 31 December 2015 | Of which with related parties | ||
|---|---|---|---|---|---|
| Liquidity | (1,747) | (1,365) | |||
| Current loans and receivables | (353) | (326) | (2,558) | (2,558) | |
| Current bank loans and borrowings | 58 | 51 | |||
| Current portion of non-current loans and borrowings | 603 | 82 | |||
| Other current loans and borrowings | 1,710 | 1,664 | 2,983 | 2,983 | |
| Current financial debt | 2,371 | 3,116 | |||
| Net current financial debt (funds) | 271 | (807) | |||
| Non-current bank loans and borrowings | 238 | 278 | |||
| Bonds issued | 2,660 | 3,243 | |||
| Other non-current loans and borrowings | 33 | - | |||
| Non-current financial debt | 2,931 | 3,521 | |||
| Net financial debt | 3,202 | 2,714 | |||
The reconciliation between Net Financial Debt and Group Net Debt, used as KPI, is as follows:
| Note | 31 December 2016 | 31 December 2015 | |
|---|---|---|---|
| Net financial debt com. CONSOB no. DEM/6064293 | 3,202 | 2,714 | |
| Fair value of the residual portion in portfolio of Ansaldo Energia | 15 | (138) | (131) |
| Hedging derivatives in respect of debt items | 15 | 35 | 13 |
| Non current financial receivables from Group's consolidated entities | 32 | (15) | - |
| Non current financial receivables from Superjet | 10 | (65) | - |
| Net debt (KPI) | 3,019 | 2,596 |
The main clauses that regulate the Leonardo’s payables are reported in the section “Industrial and financial transactions” of the Report on Operations.