Annual Report 2019

40 Non-derivative Financial Liabilities

 

Dec. 31, 2018

Dec. 31, 2019

in € million

non-current

current

non-current

current

 

 

 

 

 

Non-derivative financial liabilities

 

 

 

 

Liabilities to banks

4,893.5

306.6

6,853.9

549.1

Liabilities to other creditors

12,544.0

2,272.0

14,344.1

1,727.6

Deferred interest from non-derivative financial liabilities

119.9

100.2

 

17,437.5

2,698.5

21,198.0

2,376.9

 

 

 

 

 

Accounting Policies

Vonovia recognizes non-derivative financial liabilities, which mainly include liabilities to banks and to investors, at their fair value on the day of trading, less the directly attributable transaction costs (this generally corresponds to the acquisition cost). These liabilities are subsequently measured at amortized cost using the effective interest method. Financial liabilities are derecognized when Vonovia’s obligations specified in the contract expire or are discharged or canceled.

Liabilities bearing no interest or interest below market rates in return for occupancy rights at rents below the prevailing market rates are recorded at present value.

Deferred interest is presented as current in order to show the cash effectiveness of the interest payments transparently. In principle, the deferred interest is part of the non-derivative financial liability. Of the deferred interest from non-derivative financial liabilities, € 89.7 million (Dec. 31, 2018: € 113.9 million) is from bonds reported under non-derivative financial liabilities to other creditors.

The non-derivative financial liabilities developed as follows in the fiscal year under review:

in € million

As of Jan. 1, 2019

First-time consoli­dation

New loans

Scheduled repay­ments

Unsche­duled repayments

Adjusted for effective interest method

Other adjust­ments

Exchange rate diffe­rences

As of Dec. 31, 2019

 

 

 

 

 

 

 

 

 

 

Bond

599.6

 

 

-600.0

 

0.4

 

 

0.0

Bonds (Sweden)

62.4

 

 

-56.9

 

-3.9

 

-1.6

0.0

Bonds (USD)

215.1

 

 

 

 

4.3

 

 

219.4

Bonds (EMTN)

11,760.3

 

3,000.0

-500.0

-697.7

-16.7

 

 

13,545.9

Bond (Hybrid)

699.2

 

 

-700.0

 

0.8

 

 

0.0

Commercial Paper

420.0

 

300.0

-420.0

 

 

 

 

300.0

Promissory note loan

 

 

50.0

 

 

-0.1

 

 

49.9

Portfolio loans

 

 

 

 

 

 

 

 

 

Pfandbriefbank, Landesbank Baden-Württemberg

 

 

500.0

 

 

0.6

 

 

500.6

Berlin Hannoversche Hypothekenbank, Hessische Landesbank

 

 

 

 

-50.7

 

512.5

 

461.8

Berlin-Hannoversche Hypothekenbank (Landesbank Berlin)

499.4

 

 

 

 

 

 

 

499.4

Berlin Hannoversche Hypothekenbank, Landesbank Berlin und Landesbank Baden-Württemberg

320.5

 

 

-4.2

-23.8

0.6

 

 

293.1

Deutsche Hypothekenbank

169.1

 

 

-5.2

 

-2.7

 

 

161.2

Commerzbank

 

 

168.0

 

 

-0.1

 

 

167.9

Nordrheinische Ärzteversorgung

29.7

 

 

-0.8

-1.2

 

 

 

27.7

Norddeutsche Landesbank

113.4

 

 

-3.5

 

 

 

 

109.9

Berlin-Hannoversche Hypothekenbank Buwog Lüneburg

19.6

 

 

-0.5

 

-0.1

 

 

19.0

UniCredit – HVB Buwog Berlin

29.3

 

 

-0.7

 

-0.2

 

 

28.4

UniCredit – HVB Buwog Kreuzberg

3.6

 

 

-0.1

 

 

 

 

3.5

UniCredit – HVB Buwog Kiel

15.8

 

 

-0.4

 

-0.1

 

 

15.3

UniCredit – HVB Tempelhofer Feld

23.9

 

 

-0.6

 

-1.7

 

 

21.6

Mortgages

5,035.2

 

1,300.8

-272.6

-287.7

-9.0

-511.9

-10.1

5,244.7

Hembla:

 

 

 

 

 

 

 

 

 

Mortgages

 

1.765.4

14.4

 

 

0.4

 

25.2

1,805.4

Other deferred interest

119.9

 

 

 

 

 

-19.7

 

100.2

 

20,136.0

1,765.4

5,333.2

-2,565.5

-1,061.1

-27.5

-19.1

13.5

23,574.9

 

 

 

 

 

 

 

 

 

 

The non-derivative financial liabilities developed as follows in the previous year:

in € million

As of Jan. 1, 2018

First-time consoli­dation

New loans

Scheduled repay­ments

Unsche­duled repayments

Adjusted for effective interest method

Other adjust­ments

Exchange rate diffe­rences

As of Dec. 31, 2018

 

 

 

 

 

 

 

 

 

 

Bond

598.9

 

 

 

 

0.7

 

 

599.6

Bonds (USD)

204.8

 

 

 

 

10.3

 

 

215.1

Bonds (EMTN)

8,688.6

 

3,600.0

-500.0

 

-28.3

 

 

11,760.3

Bond (Hybrid)

697.3

 

 

 

 

1.9

 

 

699.2

Commercial Paper

410.2

 

813.0

-803.0

 

-0.2

 

 

420.0

Portfolio loans

 

 

 

 

 

 

 

 

 

Berlin-Hannoversche Hypothekenbank (Landesbank Berlin)

489.3

 

50.5

-2.1

-38.5

0.2

 

 

499.4

Berlin-Hannoversche Hypothekenbank, Landesbank Berlin und Landesbank Baden-Württemberg

341.3

 

 

-4.2

-17.3

0.7

 

 

320.5

Deutsche Hypothekenbank

176.8

 

 

-5.0

 

-2.7

 

 

169.1

Nordrheinische Ärzteversorgung

31.6

 

 

-0.7

-1.2

 

 

 

29.7

Norddeutsche Landesbank

116.7

 

 

-3.4

 

0.1

 

 

113.4

Mortgages

2,228.2

 

207.1

-50.4

-94.5

7.2

 

 

2,297.6

Working capital facility

 

 

100.0

-100.0

 

 

 

 

 

BUWOG:

 

 

 

 

 

 

 

 

 

Mortgages

 

1,958.9

203.9

-39.3

-190.3

4.9

 

 

1,938.1

Victoria Park:

 

 

 

 

 

 

 

 

 

Bonds

 

101.6

 

-38.3

 

-2.0

 

1.1

62.4

Mortgages

 

804.2

89.7

-13.4

 

-5.4

 

16.6

891.7

Other deferred interest

76.8

2.5

 

 

 

 

40.6

 

119.9

 

14,060.5

2,867.2

5,064.2

-1,559.8

-341.8

-12.6

40.6

17.7

20,136.0

 

 

 

 

 

 

 

 

 

 

The U.S. dollar bond issued in 2013 is translated at the exchange rate at the end of the reporting period in line with applicable IFRS provisions. Allowing for the hedging rate prescribed through the interest hedging transaction entered into, this financial liability would be € 37.8 million lower than the recognized value (Dec. 31, 2018: € 33.5 million).

The maturities and average interest rates of the nominal obligations of the liabilities to banks and the liabilities to other creditors are as follows during the fiscal year:

 

 

 

 

Repayment of the nominal obligations is as follows:

in € million

Nominal obligation Dec. 31, 2019

Maturity

Average interest rate

2020

2021

2022

2023

2024

from 2025

*

Under the conditions of existing loan agreements, Vonovia is obliged to fulfill certain financial covenants, which it fulfilled.

**

For a portion of the mortgages, Vonovia is obliged to fulfill certain financial covenants, which it fulfilled.

 

 

 

 

 

 

 

 

 

 

Bond (US dollar)*

185.0

2023

4.58%

 

 

 

185.0

 

 

Bond (EMTN)*

500.0

2021

3.63%

 

500.0

 

 

 

 

Bond (EMTN)*

500.0

2022

2.13%

 

 

500.0

 

 

 

Bond (EMTN)*

300.6

2020

0.88%

300.6

 

 

 

 

 

Bond (EMTN)*

500.0

2025

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

751.7

2020

1.63%

751.7

 

 

 

 

 

Bond (EMTN)*

1,000.0

2023

2.25%

 

 

 

1,000.0

 

 

Bond (EMTN)*

500.0

2022

0.88%

 

 

500.0

 

 

 

Bond (EMTN)*

500.0

2026

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

1,000.0

2024

1.25%

 

 

 

 

1,000.0

 

Bond (EMTN)*

500.0

2022

0.75%

 

 

500.0

 

 

 

Bond (EMTN)*

500.0

2027

1.75%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2025

1.13%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2024

0.75%

 

 

 

 

500.0

 

Bond (EMTN)*

500.0

2028

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

600.0

2022

0.79%

 

 

600.0

 

 

 

Bond (EMTN)*

500.0

2026

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2030

2.13%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2038

2.75%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2023

0.88%

 

 

 

500.0

 

 

Bond (EMTN)*

500.0

2025

1.80%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2029

0.50%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2034

1.13%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2023

0.13%

 

 

 

500.0

 

 

Bond (EMTN)*

500.0

2027

0.63%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2039

1.63%

 

 

 

 

 

500.0

Commercial paper*

300.0

2020

-0.23%

300.0

 

 

 

 

 

Promissory note loan*

50.0

2026

0.29%

 

 

 

 

 

50.0

Portfolio loans

 

 

 

 

 

 

 

 

 

Pfandbriefbank, Landesbank Baden-Württemberg*

500.0

2029

1.49%

 

 

 

 

 

500.0

Berlin Hannoversche Hypothekenbank, Hessische Landesbank*

461.8

2024

1.27%

 

 

 

 

461.8

 

Berlin-Hannoversche Hypothekenbank (Landesbank Berlin)*

499.4

2028

1.64%

 

 

 

 

 

499.4

Berlin Hannoversche Hypothekenbank, Landesbank Berlin und Landesbank Baden-Württemberg*

293.4

2020

3.72%

293.4

 

 

 

 

 

Deutsche Hypothekenbank*

157.5

2021

3.98%

5.5

152.0

 

 

 

 

Commerzbank*

168.0

2029

0.54%

 

 

 

 

 

168.0

Nordrheinische Ärzteversorgung*

27.7

2022

3.49%

0.8

0.9

26.0

 

 

 

Norddeutsche Landesbank*

30.5

2020

3.99%

30.5

 

 

 

 

 

 

79.7

2023

3.76%

1.2

1.3

1.3

75.9

 

 

Berlin-Hannoversche Hypothekenbank Buwog Lüneburg*

18.7

2021

2.78%

0.5

18.2

 

 

 

 

UniCredit – HVB Buwog Berlin*

28.0

2023

2.42%

0.7

0.7

0.7

25.9

 

 

UniCredit – HVB Buwog Kreuzberg*

3.5

2020

0.79%

3.5

 

 

 

 

 

UniCredit – HVB Buwog Kiel*

15.3

2021

2.02%

0.4

14.9

 

 

 

 

UniCredit – HVB Tempelhofer Feld*

21.3

2023

1.99%

0.5

0.6

0.6

19.6

 

 

Mortgages**

5,223.5

2035

1.44%

506.0

783.9

576.3

610.9

362.3

2,384.1

Hembla:

 

 

 

 

 

 

 

 

 

Mortgages**

1,689.4

2024

1.79%

82.7

 

 

187.1

442.9

976.7

 

23,405.0

 

 

2,278.0

1,472.5

2,704.9

3,104.4

2,767.0

11,078.2

In the previous year, the maturities and average interest rates of the nominal obligations were as follows:

 

 

 

 

Repayment of the nominal obligations is as follows:

in € million

Nominal obligation Dec. 31. 2018

Maturity

Average interest rate

2019

2020

2021

2022

2023

from 2024

*

Under the conditions of existing loan agreements, Vonovia is obliged to fulfill certain financial covenants, which it fulfilled.

**

For a portion of the mortgages, Vonovia is obliged to fulfill certain financial covenants, which it fulfilled.

 

 

 

 

 

 

 

 

 

 

Bond*

600.0

2019

3.13%

600.0

 

 

 

 

 

Bond (US dollar)*

184.9

2023

4.58%

 

 

 

 

184.9

 

Bond (EMTN)*

500.0

2021

3.63%

 

 

500.0

 

 

 

Bond (EMTN)*

500.0

2022

2.13%

 

 

 

500.0

 

 

Bond (EMTN)*

500.0

2020

0.88%

 

500.0

 

 

 

 

Bond (EMTN)*

500.0

2025

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

1,250.0

2020

1.63%

 

1,250.0

 

 

 

 

Bond (EMTN)*

1,000.0

2023

2.25%

 

 

 

 

1,000.0

 

Bond (EMTN)*

500.0

2022

0.88%

 

 

 

500.0

 

 

Bond (EMTN)*

500.0

2026

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

1,000.0

2024

1.25%

 

 

 

 

 

1,000.0

Bond (EMTN)*

500.0

2022

0.75%

 

 

 

500.0

 

 

Bond (EMTN)*

500.0

2027

1.75%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2025

1.13%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2019

0.03%

500.0

 

 

 

 

 

Bond (EMTN)*

500.0

2024

0.75%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2028

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

600.0

2022

0.79%

 

 

 

600.0

 

 

Bond (EMTN)*

500.0

2026

1.50%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2030

2.13%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2038

2.75%

 

 

 

 

 

500.0

Bond (EMTN)*

500.0

2023

0.88%

 

 

 

 

500.0

 

Bond (Hybrid)*

700.0

2019

4.63%

700.0

 

 

 

 

 

Commercial Paper*

420.0

2019

-0.23%

420.0

 

 

 

 

 

Portfolio loans

 

 

 

 

 

 

 

 

 

Berlin-Hannoversche Hypothekenbank (Landesbank Berlin)*

499.4

2028

1.64%

 

 

 

 

 

499.4

Berlin Hannoversche Hypothekenbank, Landesbank Berlin und Landesbank Baden-Württemberg*

321.4

2020

3.71%

4.2

317.2

 

 

 

 

Deutsche Hypothekenbank*

162.7

2021

3.98%

5.2

5.5

152.0

 

 

 

Nordrheinische Ärzteversorgung*

29.7

2022

3.49%

0.7

0.8

0.8

27.4

 

 

Norddeutsche Landesbank*

32.8

2020

3.99%

2.3

30.5

 

 

 

 

 

80.9

2023

3.76%

1.2

1.2

1.3

1.3

75.9

 

Mortgages**

2,328.9

2043

1.49%

129.6

481.2

383.7

199.7

291.0

843.7

BUWOG:

 

 

 

 

 

 

 

 

 

Mortgages

1,892.9

2029

1.97%

184.4

57.9

84.5

71.7

203.4

1,291.0

Victoria Park:

 

 

 

 

 

 

 

 

 

Bond

58.5

2020

4.50%

 

58.5

 

 

 

 

Mortgages

872.3

2023

1.79%

32.4

165.9

327.9

163.7

0.4

182.0

 

20,034.4

 

 

2,580.0

2,868.7

1,450.2

2,563.8

2,255.6

8,316.1

The loan repayments shown for the following years contain contractually fixed minimum repayment amounts.

Of the nominal obligations to creditors, € 8,108.6 million (Dec. 31, 2018: € 4,907.8 million) are secured by land charges and other collateral (account pledge agreements, assignments, pledges of company shares and guarantees). In the event of a breach of the covenants, failure to repay or insolvency, the securities provided are used to satisfy the claims of the creditors.

The nominal interest rates on the financial liabilities to banks and other creditors average approx. 1.53%. The financial liabilities as a whole do not contain any significant short-term interest rate risks as they relate either to loans with long-term fixed interest rates or variable-interest liabilities that are hedged using suitable derivative financial instruments (see chapter [G53] Financial Risk Management).

Repayment of Corporate Bonds

On April 8, 2019, Vonovia repaid the debenture (hybrid) of € 700 million, issued by Dutch subsidiary Vonovia Finance B.V., in full.

Vonovia also repaid the corporate bond (Bond Sweden) issued by its Swedish subsidiary Victoria Park in the amount of € 58.5 million in due form effective June 10, 2019.

On July 25, 2019, Vonovia repaid the subordinated debenture of € 600 million issued by Vonovia Finance B.V. in full.

In September 2019, Vonovia bought back existing bonds via Vonovia Finance B.V. as part of proactive liabilities management. As such, holders of the bond due in December 2020 with an outstanding volume of € 1,250 million and the bond due in March 2020 with an outstanding volume of € 500 million were granted the option of redeeming their bonds before the due date. Ultimately, the bond due in December 2020 was reduced by € 498.3 million to € 751.7 million due to the buyback, whereas the bond due in March 2020 was reduced by € 199.4 million to € 300.6 million.

On November 20, 2019, Vonovia repaid the debenture of € 500 million issued by Vonovia Finance B.V. in full.

Issue of Bonds Under the European Medium-Term Notes Program (EMTN)

With effect from January 29, 2019, and as part of an EMTN program, Vonovia placed a bond with a nominal volume of € 500 million and a coupon of 1.800% maturing on June 29, 2025, via Vonovia Finance B.V. The first interest payment date was June 29, 2019.

Vonovia issued two bonds for € 500 million each via Vonovia Finance B.V. on September 16, 2019. The two bonds were issued with a coupon of 0.500% and a maturity of 10 years and a coupon of 1.125% and a maturity of 15 years, respectively.

Vonovia issued bonds for € 1,500 million via Vonovia Finance B.V. on October 7, 2019. The three bonds of € 500 million each were issued with a coupon of 0.125% and a term of 3.5 years, with a coupon of 0.625% and a term of eight years and with a coupon of 1.625% and a term of 20 years.

Promissory Note Loan

Vonovia SE has initiated the digitalization of its financing strategy by issuing a promissory note loan via a digital platform for the first time. In August 2019, an institutional investor released € 50 million to Vonovia Finance B.V. as part of a private placement, with a loan term of seven years.

New Portfolio Loans

Via its subsidiaries SÜDOST WOBA DRESDEN GMBH and WOHNBAU NORDWEST GmbH, Vonovia took out a 10-year loan of € 500 million from Deutsche Pfandbriefbank AG and Landesbank Baden-Württemberg in January 2019. It is secured by a real estate portfolio in Dresden.

In January 2019, Vonovia assumed an existing BUWOG loan of € 461.8 million from Berlin-Hannoversche Hypothekenbank and Hessische Landesbank. It was previously reported as a mortgage of BUWOG and is now presented separately as a portfolio loan following the takeover. The loan agreement had originally been concluded between the banking consortium and an Austrian subsidiary of what was BUWOG Group GmbH.

Via Vonovia Finance B.V., Vonovia took out a 10-year loan for € 168 million with Commerzbank AG in September 2019, secured by a real estate portfolio in Berlin and Hamburg.

Fair Value
Fair value is particularly relevant with regard to valuation in accordance with IAS 40 in conjunction with IFRS 13. The fair value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction.
Covenants
Requirements specified in loan agreements or bond conditions containing future obligations of the borrower or the bond obligor to meet specific requirements or to refrain from undertaking certain activities.