| 15. | Borrowings |
Details of borrowings as of December 31, 2016 and 2017, are as follows:
Debentures
| (In millions of Korean won and thousands of foreign currencies) | 2016 | 2017 | ||||||||||||||||||||
| Type | Maturity | Annual interest rates |
Foreign currency |
Korean won |
Foreign currency |
Korean won |
||||||||||||||||
|
MTNP notes1 |
Sept. 07, 2034 | 6.50% | USD 100,000 | ￦ | 120,850 | USD 100,000 | ￦ | 107,140 | ||||||||||||||
|
MTNP notes |
Jan. 20, 2017 | — | USD 350,000 | 422,975 | — | — | ||||||||||||||||
|
FR notes2 |
Aug. 28, 2018 | LIBOR(3M)+1.15% | USD 300,000 | 362,550 | USD 300,000 | 321,420 | ||||||||||||||||
|
MTNP notes |
Apr. 22, 2017 | — | USD 650,000 | 785,525 | — | — | ||||||||||||||||
|
MTNP notes |
Apr. 22, 2019 | 2.63% | USD 350,000 | 422,975 | USD 350,000 | 374,990 | ||||||||||||||||
|
MTNP notes |
Jan. 29, 2018 | 0.86% | JPY 6,800,000 | 70,503 | JPY 6,800,000 | 64,539 | ||||||||||||||||
|
MTNP notes |
Feb. 23, 2018 | 0.48% | JPY 15,000,000 | 155,522 | JPY 15,000,000 | 142,367 | ||||||||||||||||
|
MTNP notes |
July 18, 2026 | 2.50% | USD 400,000 | 483,400 | USD 400,000 | 428,560 | ||||||||||||||||
|
MTNP notes |
Aug 07, 2022 | 2.63% | — | — | USD 400,000 | 428,560 | ||||||||||||||||
|
The 173-2nd Public bond |
Aug. 06, 2018 | 6.62% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 177-3rd Public bond |
Feb. 09, 2017 | — | — | 170,000 | — | — | ||||||||||||||||
|
The 179th Public bond |
Mar. 29, 2018 | 4.47% | — | 260,000 | — | 260,000 | ||||||||||||||||
|
The 180-2nd Public bond |
Apr. 26, 2021 | 4.71% | — | 380,000 | — | 380,000 | ||||||||||||||||
|
The 181-2nd Public bond |
Aug. 26, 2018 | 3.99% | — | 90,000 | — | 90,000 | ||||||||||||||||
|
The 181-3rd Public bond |
Aug. 26, 2021 | 4.09% | — | 250,000 | — | 250,000 | ||||||||||||||||
|
The 182-2nd Public bond |
Oct. 28, 2021 | 4.31% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 183-2nd Public bond |
Dec. 22, 2021 | 4.09% | — | 90,000 | — | 90,000 | ||||||||||||||||
|
The 183-3rd Public bond |
Dec. 22, 2031 | 4.27% | — | 160,000 | — | 160,000 | ||||||||||||||||
|
The 184-1st Public bond |
Apr. 10, 2018 | 2.74% | — | 120,000 | — | 120,000 | ||||||||||||||||
|
The 184-2nd Public bond |
Apr. 10, 2023 | 2.95% | — | 190,000 | — | 190,000 | ||||||||||||||||
|
The 184-3rd Public bond |
Apr. 10, 2033 | 3.17% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 185-1st Public bond |
Sept. 16, 2018 | 3.46% | — | 200,000 | — | 200,000 | ||||||||||||||||
|
The 185-2nd Public bond |
Sept. 16, 2020 | 3.65% | — | 300,000 | — | 300,000 | ||||||||||||||||
|
The 186-1st Public bond |
June 26, 2017 | — | — | 120,000 | — | — | ||||||||||||||||
|
The 186-2nd Public bond |
June 26, 2019 | 3.08% | — | 170,000 | — | 170,000 | ||||||||||||||||
|
The 186-3rd Public bond |
June 26, 2024 | 3.42% | — | 110,000 | — | 110,000 | ||||||||||||||||
|
The 186-4th Public bond |
June 26, 2034 | 3.70% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 187-1st Public bond |
Sept. 02, 2017 | — | — | 110,000 | — | — | ||||||||||||||||
|
The 187-2nd Public bond |
Sept. 02, 2019 | 2.97% | — | 220,000 | — | 220,000 | ||||||||||||||||
|
The 187-3rd Public bond |
Sept. 02, 2024 | 3.31% | — | 170,000 | — | 170,000 | ||||||||||||||||
|
The 187-4th Public bond |
Sept. 02, 2034 | 3.55% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 188-1st Public bond |
Jan. 29, 2020 | 2.26% | — | 160,000 | — | 160,000 | ||||||||||||||||
|
The 188-2nd Public bond |
Jan. 29, 2025 | 2.45% | — | 240,000 | — | 240,000 | ||||||||||||||||
|
The 188-3rd Public bond |
Jan. 29, 2035 | 2.71% | — | 50,000 | — | 50,000 | ||||||||||||||||
|
The 189-1st Public bond |
Jan. 27, 2019 | 1.76% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 189-2nd Public bond |
Jan. 27, 2021 | 1.95% | — | 130,000 | — | 130,000 | ||||||||||||||||
|
The 189-3rd Public bond |
Jan. 27, 2026 | 2.20% | — | 100,000 | — | 100,000 | ||||||||||||||||
|
The 189-4rd Public bond |
Jan. 27, 2036 | 2.35% | — | 70,000 | — | 70,000 | ||||||||||||||||
|
The 17th unsecured bond |
Apr. 22, 2018 | 1.89% | — | 60,000 | — | 60,000 | ||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
| 7,344,300 | 5,987,576 | |||||||||||||||||||||
|
Less: Current portion |
(1,607,570 | ) | (1,357,776 | ) | ||||||||||||||||||
|
Discount on bonds |
(20,852 | ) | (19,347 | ) | ||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
|
Total |
￦ | 5,715,878 | ￦ | 4,610,453 | ||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
| 1 | As of December 31, 2017, the Controlling Company has outstanding notes in the amount of USD 100 million with fixed interest rates under Medium Term Note Program (“MTNP”) registered in the Singapore Stock Exchange, which allowed issuance of notes of up to USD 2,000 million. However, the MTN Program has been suspended since 2007. |
| 2 | Libor (3M) are approximately 1.695 % as of December 31, 2017. |
Short-term borrowings
| (In millions of Korean won) | 2016 | 2017 | ||||||||||
| Type | Financial institution | Annual interest rates | ||||||||||
|
Operational |
Shinhan Bank | 2.99% ~ 4.41% | ￦ | 120,300 | ￦ | 113,300 | ||||||
| Standard Charted Bank | — | 8,000 | — | |||||||||
| Korea Development Bank | 3.97% | 20,800 | 12,000 | |||||||||
| Indutrial Bank of Korea | — | 1,000 | — | |||||||||
| SooHyup Bank | 4.22% | 3,000 | 3,000 | |||||||||
|
|
|
|
|
|||||||||
| Total | ￦ | 153,100 | ￦ | 128,300 | ||||||||
|
|
|
|
|
|||||||||
Long-term borrowings
| (In millions of Korean won and thousands of foreign currencies) | 2016 | 2017 | ||||||||||||||||||||
| Financial institution | Type | Annual interest rates |
Foreign currency |
Korean won |
Foreign currency |
Korean won |
||||||||||||||||
|
Export-Import Bank of Korea |
Inter-Korean Cooperation Fund1 | 1.50% | — | ￦ | 5,181 | — | ￦ | 4,688 | ||||||||||||||
|
Shinhan Bank |
General loans | 2.50% | — | 31,000 | — | 30,000 | ||||||||||||||||
|
Facility loans |
2.56% | — | 6,493 | — | 6,000 | |||||||||||||||||
|
Vessel facility loans2 |
LIBOR(3M)+0.706% | USD 21,000 | 25,379 | USD 15,000 | 16,071 | |||||||||||||||||
|
KEB Hana Bank |
General loans | 3.95% | — | 3,000 | — | 3,000 | ||||||||||||||||
|
Standard Charted Bank |
General loans | 3.16% | — | — | — | 8,000 | ||||||||||||||||
|
Woori Bank |
General loans | — | — | 13,000 | — | — | ||||||||||||||||
|
NongHyup Bank |
General loans | 2.86% | — | — | — | 8,000 | ||||||||||||||||
|
Facility loans |
2.00% | 123 | — | 123 | ||||||||||||||||||
|
Korea Development Bank |
General loans | 3.27% | — | 30,000 | — | 30,000 | ||||||||||||||||
|
Kookmin Bank |
Facility loans | 2.59% | — | 7,000 | — | 2,333 | ||||||||||||||||
|
NH Investment & Security Co., Ltd. |
Commercial papers | 3.17% | — | 300,000 | — | 300,000 | ||||||||||||||||
|
Others |
Redeemable convertible preferred stock3 | — | — | 950 | — | 950 | ||||||||||||||||
|
Kookmin Bank and other2 |
3.15% | USD 183,796 | 222,117 | USD 166,108 | 177,968 | |||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
| ￦ | 644,243 | ￦ | 587,133 | |||||||||||||||||||
|
Less: Current portion |
￦ | (59,331 | ) | ￦ | (87,398 | ) | ||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
|
Total |
￦ | 584,912 | ￦ | 499,735 | ||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
| 1 | The Inter-Korean Cooperation Fund is repayable in installments over 13 years after a seven-year grace period. |
| 2 | LIBOR(3M) is approximately 1.695% as of December 31, 2017. |
| 3 | Skylife TV Co., Ltd., a subsidiary of the Group, issued 1,900,000 of redeemable convertible preferred stock with a par value per share of ￦500 in 2010. |
Repayment schedule of the Group’s borrowings including the portion of current liabilities as of December 31, 2017, is as follows:
| (in millions of Korean won) | ||||||||||||||||||||||||||||
| Debentures | Borrowings | Total | ||||||||||||||||||||||||||
| In local currency |
In foreign currency |
Sub- total | In local currency |
In foreign currency |
Sub- total | |||||||||||||||||||||||
|
Jan 1, 2018 ~ Dec 31, 2018 |
￦ | 830,000 | ￦ | 528,326 | ￦ | 1,358,326 | ￦ | 167,395 | ￦ | 48,303 | ￦ | 215,698 | ￦ | 1,574,024 | ||||||||||||||
|
Jan 1, 2019 ~ Dec 31, 2019 |
490,000 | 374,990 | 864,990 | 343,465 | 48,303 | 391,768 | 1,256,758 | |||||||||||||||||||||
|
Jan 1, 2020 ~ Dec 31, 2020 |
460,000 | — | 460,000 | 1,518 | 45,089 | 46,607 | 506,607 | |||||||||||||||||||||
|
Jan 1, 2021 ~ Dec 31, 2021 |
950,000 | — | 950,000 | 1,518 | 41,875 | 43,393 | 993,393 | |||||||||||||||||||||
|
After 2022 |
1,390,000 | 964,260 | 2,354,260 | 7,498 | 10,469 | 17,967 | 2,372,227 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| ￦ | 4,120,000 | ￦ | 1,867,576 | ￦ | 5,987,576 | ￦ | 521,394 | ￦ | 194,039 | ￦ | 715,433 | ￦ | 6,703,009 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Carrying amount and fair value of the Group’s debentures and borrowings as of December 31, 2016 and 2017, are as follows:
| (In millions of Korean won) | 2016 | 2017 | ||||||||||||||
| Type |
Carrying Amount |
Fair Value |
Carrying Amount |
Fair Value |
||||||||||||
|
Debentures |
￦ | 7,323,448 | ￦ | 7,387,085 | ￦ | 5,968,229 | ￦ | 6,022,551 | ||||||||
|
Long-term borrowings (Including current portion of long-term borrowings) |
644,243 | 644,010 | 587,133 | 587,475 | ||||||||||||
|
Short-term borrowings |
153,100 | 153,100 | 128,300 | 128,300 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Total |
￦ | 8,120,791 | ￦ | 8,184,195 | ￦ | 6,683,662 | ￦ | 6,738,326 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
The fair values of debentures and long-term borrowings are calculated by discounting the expected future cash flows at weighted average borrowing rate. The weighted average borrowing rate is approximately 3.37% (2016: 3.38%) as of December 31, 2017. The carrying amount of borrowings of subsidiaries is the reasonable approximately amount of the fair value.