C20. Long-term and short-term borrowings

Open-market financing programs

TeliaSonera’s open-market financing (excluding debt derivatives) entails the following programs.

Program

 

Characteristics

Limit

currency

Dec 31, 2015

Dec 31, 2014

Limit

Utilized

Interest rate type

Average

maturity

Limit

Utilized

Floating

Fixed

(in millions)

(years)

(in millions)

TeliaSonera AB

Euro Medium
Term Note (EMTN)

Uncommitted, International, Long-term

EUR

12,000

9,408

1,107

8,301

8

12,000

9,298

TeliaSonera AB

Euro Commercial Paper (ECP)

Uncommitted, International, Short-term

EUR

1,000

1,000

TeliaSonera AB

Flexible Term Note (FTN)

Uncommitted, Swedish domestic, Short-term and long-term

SEK

12,000

12,000

 

Borrowings

Long-term and short-term borrowings were distributed as follows.

SEK in millions

Dec 31, 2015

Dec 31, 2014

Carrying value

Fair value

Carrying value

Fair value

Long-term borrowings

       

Open-market financing program borrowings in fair value hedge relationships

37,672

41,021

26,955

34,726

Interest rate swaps at fair value

627

627

283

283

of which designated as hedging instruments

591

591

244

244

of which held-for-trading

36

36

39

39

Cross currency interest rate swaps at fair value

1,694

1,694

1,577

1,577

of which hedging net investments

1,333

1,333

1,263

1,263

of which designated as hedging instruments

198

198

220

220

of which held-for-trading

164

164

94

94

Subtotal (see Fair value hierarchy levels – Note C25)

39,993

43,342

28,814

36,585

Open-market financing program borrowings at amortized cost

47,908

53,577

57,861

63,534

of which hedging net investments

29,820

34,809

40,989

45,249

Other borrowings at amortized cost

3,699

3,699

3,431

3,431

Subtotal (see Categories – Note C25)

91,600

100,618

90,106

103,549

Finance lease agreements

46

46

62

62

Total long-term borrowings

91,646

100,664

90,168

103,611

Short-term borrowings

       

Open-market financing program borrowings in fair value hedge relationships

7,414

7,414

Interest rate swaps designated as hedging instruments

43

43

Interest rate swaps held for trading

7

7

Cross currency interest rate swaps held-for trading

21

21

329

329

Subtotal (see Fair value hierarchy levels – Note C25)

72

72

7,743

7,743

Utilized bank overdraft and short-term credit facilities at amortized cost

9

9

1,057

1,058

Open-market financing program borrowings

5,627

5,648

725

726

of which hedging net investments

1,583

1,589

of which at amortized cost

4,043

4,059

725

726

Other borrowings at amortized cost

3,623

3,623

1,786

1,786

Subtotal (see Categories – Note C25)

9,330

9,351

11,311

11,313

Finance lease agreements

7

7

10

10

Total short-term borrowings

9,337

9,358

11,321

11,323

The fair values of borrowings above relate to hierarchy level 2. For a description of valuation techniques, see Note C3 “Significant accounting principles,” section “Fair value estimation.”

Normally, borrowings by TeliaSonera denominated in foreign currencies are swapped into SEK. The exceptions typically include funds borrowed to finance the group’s international operations or selective hedging of net investments abroad. As of December 31, 2015, long-term borrowings in fair value hedge relationships also included borrowings hedging net investments.These loans have final maturities in 2020 (SEK 6,989 million), 2021 (SEK 7,783 million), 2022 (SEK 6,370 million) and later years (SEK 25,978 million).

The nominal value of TeliaSonera AB’s portfolio of interest rate swaps and cross currency interest rate swaps as of the end of the reporting period was as follows.

SEK in millions

Dec 31, 2015

Dec 31, 2014

Nominal portfolio value

77,847

77,439

of which intended for overall management of the funding portfolio structure and hence not included in hedge relationships

300

Refer to Note C25 “Financial assets and liabilities by category and level” for more information on financial instruments classified by category/fair value hierarchy level and to Note C26 “Financial risk management” for information on maturities and management of liquidity risk, currency risk, interest rate risk and financing risk, respectively.

© TeliaSonera 2015
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