Aviva 2014 Annual Report Download - page 217

Aviva plc Annual report and accounts 2014
213
50 – Borrowings continued
(c) The UK long-term business entered into a financial reassurance agreement with Swiss Re in 2008, under which up-front
payments are received from Swiss Re in return for 90% of future surpluses arising. The loan will be repaid as profits emerge on the
business. The UK long-term business entered into an additional financial reassurance agreement with BNP Paribas in 2012 in return
for 100% of future surpluses arising. The loan will be repaid as profits emerge on the business.
(d) Other non-recourse loans primarily include external debt raised by special purpose vehicles in the UK long-term business. The
lenders have no recourse whatsoever to the shareholders’ funds of any companies in the Group.
(e) Other loans include external debt raised by overseas long-term businesses to fund operations.
(v) Securitised mortgage loan notes
Loan notes have been issued by special purpose securitisation companies in the UK. Details are given in note 25.
(e) Movements during the year
Movements in borrowings during the year were:
2014 2013
Core
Structural
£m
Operational
£m
Total
£m
Core
Structural
£m
Operational
£m
Total
£m
New borrowings drawn down, excluding commercial paper, net of expenses 552 1 553 554 184 738
Repayment of borrowings, excluding commercial paper (241) (372) (613) (546) (347) (893)
Movement in commercial paper1 1
—
1 (50)
—
(50)
Net cash inflow/(outflow) 312 (371) (59) (42) (163) (205)
Foreign exchange rate movements (132) (5) (137) 24 (42) (18)
Borrowings acquired/(loans repaid) for non-cash consideration2
—
(321) (321) — (183) (183)
Fair value movements
—
70 70 — (4) (4)
Amortisation of discounts and other non-cash items 5 (29) (24) 5 (21) (16)
Movements in debt held by Group companies3
—
1 1 (1) (49) (50)
Movements in the year 185 (655) (470) (14) (462) (476)
Balance at 1 January 5,125 2,723 7,848 5,139 3,185 8,324
Balance at 31 December 5,310 2,068 7,378 5,125 2,723 7,848
1 Gross issuances of commercial paper were £1,830 million in 2014 (2013: £1,583 million), offset by repayments of £1,829 million (2013: £1,633 million).
2 Includes borrowings disposed of / repaid as part of the disposal of US Life in 2013 of £179 million.
3 Certain subsidiary companies have purchased issued subordinated notes and securitised loan notes as part of their investment portfolios. In the consolidated statement of financial position, borrowings are shown net of these holdings
but movements in such holdings over the year are reflected in the tables above.
All movements in fair value in 2013 and 2014 on securitised mortgage loan notes designated as fair value through profit or loss
were attributable to changes in market conditions.
(f) Undrawn borrowings
The Group and Company have the following undrawn committed central borrowing facilities available to them, of which £750
million (2013: £750 million) is used to support the commercial paper programme:
2014
£m
2013
£m
Expiring within one year 350 400
Expiring beyond one year 1,200 1,100
1,550 1,500
51 – Payables and other financial liabilities
This note analyses our payables and other financial liabilities at the end of the year.
2014
£m
Restated1
2013
£m
Payables arising out of direct insurance 948 1,115
Payables arising out of reinsurance operations 358 440
Deposits and advances received from reinsurers 92 145
Bank overdrafts (see below) 550 493
Derivative liabilities (note 59) 3,481 2,251
Amounts due to brokers for investment purchases 73 164
Obligations for repayment of cash collateral received 5,577 5,604
Other financial liabilities 933 1,747
Total 12,012 11,959
Less: Amounts classified as held for sale —(14)
12,012 11,945
Expected to be settled within one year 10,731 10,337
Expected to be settled in more than one year 1,281 1,608
12,012 11,945
1 Restated for the adoption of amendments to IAS 32 ‘Financial Instruments: Presentation’ – see note 1 for details.
Bank overdrafts amount to £95 million (2013: £77 million) in life business operations and £455 million (2013: £416 million) in
general insurance business and other operations.
All payables and other financial liabilities are carried at cost, which approximates to fair value, except for derivative liabilities,
which are carried at their fair values.
Aviva plc Annual report and accounts 2014 |213
IFRS Financial statements