Debt

In accordance with the IAS/IFRS managerial model used by the Generali Group, consolidated liabilities were split into two categories:

  • Liabilities linked to operating activities, which are all the consolidated financial liabilities related to specific consolidated balance sheet items. This category also includes liabilities related to investment contracts issued by insurance companies and liabilities to banks and customers of banks belonging to the group;
  • Liabilities linked to financing activities, including other consolidated financial liabilities, such as subordinated liabilities, bonds issued and other loans received. This category includes, for example, liabilities arising from operations carried out to acquire controlling interests.

Total liabilities were as follows:

(€ million)31.12.201330.09.201331.12.2012
Liabilities linked to operating activities 49,258 50,183 50,671
Liabilities linked to financing activities 12,758 12,713 13,234
Subordinated liabilities 7,612 7,577 7,833
Senior bonds 4,468 4,467 4,464
Other non subordinated liabilities linked to financing activities 678 670 937
Total 62,016 62,896 63,905

The variation of financial debt compared to the stock at 31 December 2012 is mainly due to the repayment in cash of a subordinated loan for a nominal amount of € 200 million and a senior debt, classified as "Other non-subordinated liabilities linked to financing activities" for a nominal amount of € 350 million.

The weighted average cost of financial debt at 31 December 2013 amounted to 5.93%, stable with respect to 30 September 2013 (5.93%) slightly increasing with respect to 31 Dicember 2012 at 5.85%. The weighted average cost reflects the annualized cost of financial debt considering the outstanding debt at the reporting date and the related activities of currency and interest rate hedging.

Interest expenses on total liabilities are detailed as follows:

(€ million)31.12.201331.12.2012Variazione
Interest expense on liabilities linked to operating activities547569-3.9%
Interest expense on liabilities linked to financing activities75166812.4%
Total(*)1,2981,2374.9%

(*) Without taking into account the interest expenses on liabilities linked of the real estate development companies, classified among the other expenses, as well as the interest expenses on deposits under reinsurance business accepted, deducted from the related interest income.

Financial liabilities at fair value through profit or loss

 Financial liabilities held
for trading
Financial liabilities designated as
at fair value through profit or loss
Total
(€ million)31.12.201331.12.201231.12.201331.12.201231.12.201331.12.2012
Financial liabilities related to investment
contracts issued by insurance companies
0 0 13,270 12,650 13,270 12,650
where the investment risk is borne by the
policyholders
0 0 11,743 11,188 11,743 11,188
pension funds 0 0 1,484 1,414 1,484 1,414
other financial liabilities related to
investment contracts
0 0 42 48 42 48
Derivatives 561 358 571 721 1,131 1,079
Hedging derivatives 0 0 894 1,028 894 1,028
Other financial liabilities 0 0 789 796 789 796
Total 561 358 15,523 15,194 16,084 15,553

Other financial liabilities

(€ million)31.12.201331.12.2012
Subordinated liabilities 7,612 7,833
Loans and bonds 14,312 15,641
Deposits received from reinsurers 997 1,077
Bonds(**) 4,915 4,975
Other loans 3,738 4,643
Financial liabilities related to investment contracts issued by insurance companies 4,663 4,947
Liabilities to banks or customers 24,008 24,880
Liabilities to banks 1,616 2,147
Liabilities to customers 22,392 22,733
Total 45,932 48,354

(**) Including senior bond issued in May 2010 to fund the tax recognition of goodwill related to the extraordinary operation Alleanza Toro for a nominal amount of € 560 million (at 31.12.2013 the related book value amounted to € 447 million). This issue was classified as operating debt because the debt structure provides a perfect correlation between cash flows arising from the recognition of taxes and loan repayments in terms of interest than capital.

Details of the main issuances

Subordinated liabilities

The table below summarizes the main subordinated issuances in the market and their features:

IssuerCouponOutstanding(***)CurrencyAmortised cost(****)Issue dateCall dateMaturity
Generali Finance B.V. 5.32% 1,275 EUR 1,252 16.06.2006 16.06.2016 Perp
Generali Finance B.V. 6.21% 700 GBP 839 16.06.2006 16.06.2016 Perp
Assicurazioni  Generali 6.27% 350 GBP 418 16.06.2006 16.06.2026 Perp
Generali Finance B.V. 5.48% 1,250 EUR 938 08.02.2007 08.02.2017 Perp
Assicurazioni  Generali 6.42% 495 GBP 590 08.02.2007 08.02.2022 Perp
Assicurazioni  Generali 10.13% 750 EUR 747 10.07.2012 10.07.2022 10.07.2042
Assicurazioni  Generali 7.75% 1,250 EUR 1,245 12.12.2012 12.12.2022 12.12.2042

(***) in currency million.

(****) in € million.

Subordinated liabilities issued by Assicurazioni Generali S.p.A. and other subsidiaries in the form of private placements are also classified in this category. The unquoted private placements issued by Assicurazioni Generali S.p.A. for a nominal amount of € 1,500 million, are accounted for at a corresponding amortized cost of € 1,485 million, including bank financing of € 500 million. The remaining subordinated liabilities are mainly issued by BSI, for a nominal amount USD 100 million, and other other debt issued by Austian companies. The total corresponding amortised cost amounted to € 98 million.

The fair value of subordinated liabilities amounts to € 8,053 million.

Senior bonds

The category of bonds includes various senior issues shown below:

IssuerTaux nominalOutstanding(5)CurrencyAmortised cost(6)Issue dateMaturity
Generali Finance B.V. 4.75% 1,500 EUR 1,492 12.05.1999 12.05.2014
Generali Finance B.V. 3.88% 500 EUR 499 06.05.2005 06.05.2015
Assicurazioni  Generali 4.88% 750 EUR 742 11.03.2009 11.11.2014
Assicurazioni  Generali 5.13% 1,750 EUR 1,721 16.09.2009 16.09.2024

(5) in currency million.

(6) in € million.

Other senior bonds issued by Ceska Pojistovna for a nominal amount of CZK 500 million corresponding to an amortized cost of € 14 million are also classified in this category.

The fair value of bonds issued (mainly fixed interest rate bonds) amounted to € 5,165 million.

Liabilities to banks and customers are mainly payable on demand or short term liabilities.

Other payables

(€ million) 31.12.201331.12.2012
Payables arising out of direct insurance operations 3,190 3,314
Payables arising out of direct insurance operations 572 646
Other payables 4,367 4,073
Payables to employees 1,037 982
Provision for defined benefit plans (employee severance pay) 102 103
Payables to clients and suppliers 1,155 1,023
Social security 186 149
Other payables 1,887 1,817
Total 8,129 8,033
AttachmentSize
Leverage111.35 KB
Focus on financial debt84.19 KB
Financial debt breakdown by expiry date/call date82.21 KB
Assicurazioni Generali S.p.A. - C.F. e P.IVA 00079760328