In addition to the financing effect of the changes in shareholders’ equity described above, debt financing on the capital market is a significant component of Hannover Re’s financing. It was essentially composed of bonds issued to ensure lasting protection of our capital base – in part also in observance of rating requirements. The total volume of long-term debt and notes payable stood at EUR 2,558.9 million (EUR 1,742.1 million) as at the balance sheet date.
Our bonds supplement our equity with the aim of reducing the cost of capital and also help to ensure liquidity at all times. As at the balance sheet date altogether four bonds had been placed on the European capital market through Hannover Rück SE and Hannover Finance (Luxembourg) S. A.
The following table presents an overview of the amortised cost of the issued bonds.
|Amortised cost of our subordinated bonds|
|in EUR million||Issue date||Coupon in %||2018||2017|
|Hannover Finance (Luxembourg) S.A., subordinated debt, EUR 500 million; 2010 / 2040||14.9.2010||5.75||499.3||499.1|
|Hannover Finance (Luxembourg) S.A., subordinated debt, EUR 500 million; 2012 / 2043||20.11.2012||5.00||498.2||497.8|
|Hannover Rück SE, subordinated debt, EUR 500 million; 2014 / undated||15.9.2014||3.375||495.6||495.0|
|Hannover Rück SE, senior bond, |
EUR 750 million
2018 / 2028
Several Group companies have also taken up long-term debt – principally in the form of mortgage loans – amounting to EUR 323.2 million (EUR 250.1 million).
For further explanatory information please see our remarks in the notes to this report, section 6.12 “Long-term debt and notes payable”, page 240 et seq., and section 6.13 “Shareholders’ equity and treasury shares”.
Various financial institutions have provided us with letters of credit for the collateralisation of technical liabilities. We report in detail on existing contingent liabilities in the notes, section 8.7 “Contingent liabilities and commitments”.