Financial Liabilities Financial liabilities were comprised as follows: (XLS:) Download Financial Liabilities Dec. 31, 2016 Dec. 31, 2017 Total Of which current Total Of which current € million € million € million € million Bonds and notes / promissory notes 15,991 2,010 12,436 505 Liabilities to banks 1,837 820 534 513 Liabilities under finance leases 436 59 238 32 Liabilities from derivatives 587 309 240 221 Other financial liabilities 730 203 970 664 Total 19,581 3,401 14,418 1,935 The development of financial liabilities in 2017 is outlined in Note “Net Cash Provided by (Used in) Financing Activities”. A breakdown of financial liabilities by contractual maturity is given below: (XLS:) Download Maturities of Financial Liabilities Dec. 31, 2016 € million 2017 3,401 2018 3,241 2019 2,456 2020 44 2021 2,714 2022 or later 7,725 Total 19,581 (XLS:) Download Maturities of Financial Liabilities Dec. 31, 2017 € million 2018 1,935 2019 2,155 2020 1,248 2021 2,096 2022 89 2023 or later 6,895 Total 14,418 In addition to promissory notes in the amount of €45 million (2016: €45 million), the Bayer Group has issued the following bonds and notes: (XLS:) Download Bonds and Notes Effective interest rate Stated rate Nominal volume Dec. 31, 2016 Dec. 31, 2017 € million € million 1 Floating-rate coupon comprising three-month EURIBOR plus 22 basis points 2 Floating-rate coupon comprising three-month USD-LIBOR plus 28 basis points 3 Bond was early redeemed in October 2017 4 Bond can be redeemed in cash, Covestro shares or a combinaton thereof 5 Date of first option to early redeem the bond at par 6 The mandatory convertible notes were allocated to capital reserves and to other financial liabilities. Bayer AG, Germany 1.253% 1.125% DIP bond 2014 / 20183 EUR 750 million 749 – 5.774% 5.625% DIP bond 2006 / 2018 GBP 250 million 292 281 5.541% 5.625% DIP bond 2006 / 2018 (increase) GBP 100 million 117 113 0.050% 0.050% Exchangeable bond4 2017 / 2020 EUR 1,000 million – 1,220 2.086% 1.875% DIP bond 2014 / 2021 EUR 750 million 755 753 3.811% 3.750% Hybrid bond 2014 / 20245 / 2074 EUR 1,500 million 1,494 1,495 2.517% 2.375% Hybrid bond 2015 / 20225 / 2075 EUR 1,300 million 1,290 1,292 3.093% 3.000% Hybrid bond 2014 / 20205 / 2075 EUR 1,750 million 1,745 1,746 Bayer Capital Corporation B.V., Netherlands 1.333% 1.250% DIP bond 2014 / 2023 EUR 500 million 497 498 6.061% 5.625% Mandatory convertible notes6 2016 / 2019 EUR 4,000 million – – Bayer Corporation, U.S.A. 6.670% 6.650% Notes 1998 / 2028 US$ 350 million 351 307 Bayer Holding Ltd., Japan 0.858% 0.816% DIP bond 2012 / 2017 JPY 30 billion 243 – 1.493% 1.459% DIP bond 2010 / 2017 JPY 10 billion 81 – 3.654% 3.575% DIP bond 2008 / 2018 JPY 15 billion 122 111 0.629% 0.594% DIP bond 2013 / 2019 JPY 10 billion 81 74 0.270% 0.230% DIP bond 2017 / 2021 JPY 10 billion – 74 0.301% 0.260% DIP bond 2017 / 2022 JPY 10 billion – 74 Bayer Nordic SE, Finland Floating1 Floating1 DIP bond 2014 / 2017 EUR 500 million 500 – Bayer U.S. Finance LLC, U.S.A. Floating2 Floating2 Notes 2014 / 2017 US$ 400 million 379 – 1.615% 1.500% Notes 2014 / 2017 US$ 850 million 806 – 2.564% 2.375% Notes 2014 / 2019 US$ 2,000 million 1,889 1,662 3.096% 3.000% Notes 2014 / 2021 US$ 1,500 million 1,419 1,247 3.579% 3.375% Notes 2014 / 2024 US$ 1,750 million 1,642 1,444 Covestro AG, Germany Floating Floating DIP bond 2016 / 2018 EUR 500 million 500 – 1.076% 1.000% DIP bond 2016 / 2021 EUR 500 million 497 – 1.782% 1.750% DIP bond 2016 / 2024 EUR 500 million 497 – Total 15,946 12,391 Debt Issuance Programme An important means of external financing are the bonds issued under the Debt Issuance Programme (DIP) schließen Debt Issuance Program (DIP) DIP is a documentation platform that has enabled Bayer to flexibly issue notes in various currencies and with different maturities. . Bayer Holding Ltd., Japan, issued two JPY 10 billion bonds under the DIP in May 2017. Hybrid bonds The hybrid bonds schließen Hybrid bond A hybrid bond is a corporate bond with equity-equivalent properties, usually with either no maturity date or a very long maturity. Due to its subordination, it has a lower likelihood of repayment than a normal bond in the event of issuer bankruptcy. issued by Bayer AG are subordinated, and 50% of their amount is treated by Moody’s and S & P Global Ratings as equity. They therefore have a more limited effect on the Group’s rating-relevant debt indicators than senior borrowings. Mandatory convertible notes On November 22, 2016, Bayer Capital Corporation B.V. placed subordinated mandatory convertible notes in the amount of €4,000 million, which will be converted into no-par shares of Bayer AG at maturity. The notes represented the first part of the equity component of the financing for the planned acquisition of Monsanto. The mandatory convertible notes were recognized in capital reserves and other financial liabilities. Exchangeable bond On June 14, 2017, Bayer AG issued bonds with a nominal value of €1,000 million which mature in 2020. The issue price was 105.25 percent of the principal amount and the initial exchange price was fixed at €80.93. These bonds can be settled in cash, by delivery of Covestro shares or by a combination thereof at or prior to maturity. Applying the fair value option under IAS 39.11A, these debt instruments were designated as financial liabilities at fair value through profit or loss upon first-time recognition. Bayer AG guarantees all the bonds issued by subsidiaries. Lease liabilities Lease payments totaling €365 million (2016: €609 million), including €127 million (2016: €173 million) in interest, are to be made under finance leases to the respective lessors in future years. The liabilities under finance leases mature as follows: (XLS:) Download Lease Liabilities Dec. 31, 2016 Lease payments Interest component Liabilities under finance leases Maturity € million € million € million 2017 88 29 59 2018 76 24 52 2019 68 21 47 2020 59 17 42 2021 57 15 42 2022 or later 261 67 194 Total 609 173 436 (XLS:) Download Lease Liabilities Dec. 31, 2017 Lease payments Interest component Liabilities under finance leases Maturity € million € million € million 2018 49 17 32 2019 44 13 31 2020 39 12 27 2021 31 11 20 2022 25 10 15 2023 or later 177 64 113 Total 365 127 238 Other financial liabilities Other financial liabilities as of December 31, 2017, comprised €525 million (2016: €652 million) relating to the mandatory convertible notes issued in November 2016, and €292 million (2016: €0 million) in commercial paper. Other information As of December 31, 2017, the Group had undrawn credit facilities at its disposal totaling €47 billion (2016: €55 billion), including €43 billion, or US$52 billion (2016: €50 billion, or US$53 billion), in bridge financing for the planned acquisition of Monsanto. Further information on the accounting for liabilities from derivatives is given in Note “Financial Instruments”.
