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85
Cathay Pacific Airways Limited Annual Report 2006
28. Financial risk management (continued)
(d) Interest rate risk
Interest rate swaps are used to manage the interest rate profile of interest-bearing financial liabilities on a
currency by currency basis to maintain an appropriate fixed rate and floating rate ratio.
The table below indicates the effective interest rates of interest-bearing financial liabilities and interest-earning
financial assets as at the balance sheet date and the period in which they are repriced or mature whichever
is earlier:
2006
Fixed/
floating
Effective
interest
rate (%)
Within
one year
HK$M
After one
year but
within
two years
HK$M
After two
years but
within
five years
HK$M
After five
years
HK$M
Total
HK$M
Group
Bank loans Floating 4.03-5.99 (11,016) – – – (11,016)
Other loans Fixed 3.06-3.82 – – (1,902) – (1,902)
Other loans Floating 3.80-4.24 (1,541) – – – (1,541)
Obligations under finance leases Fixed 1.64-8.75 (1,428) (661) (3,640) (10,168) (15,897)
Obligations under finance leases Floating 3.15-6.24 (11,103) – – – (11,103)
Pledged security deposits Fixed 3.05-8.75 899 527 1,027 6,938 9,391
Pledged security deposits Floating 5.24 125 – – – 125
Currency swap Floating 1.29-9.12 1,442 (395) (371) (699) (23)
Interest rate swap Fixed 2.80-6.43 1,319 (252) (1,067) – –
Liquid funds Fixed 2.27 – 180 – – 180
Liquid funds Floating 0-7.33 15,444 – – – 15,444
Bank overdrafts Floating 0-16.25 (29) – – – (29)
2005
Fixed/
floating
Effective
interest
rate (%)
Within
one year
HK$M
After one
year but
within two
years
HK$M
After two
years but
within five
years
HK$M
After five
years
HK$M
Total
HK$M
Group
Bank loans Floating 3.20-5.28 (4,839) – – – (4,839)
Other loans Fixed 0-7.00 (32) – (1,083) – (1,115)
Other loans Floating 2.68-2.83 (309) – – – (309)
Obligations under finance leases Fixed 1.64-8.75 (422) (1,305) (2,918) (10,659) (15,304)
Obligations under finance leases Floating 1.77-5.33 (11,027) – – – (11,027)
Pledged security deposits Fixed 3.25-8.75 570 811 1,307 7,347 10,035
Pledged security deposits Floating 4.07 104 – – – 104
Currency swap Floating 1.29-9.12 1,098 (78) (411) (398) 211
Interest rate swap Fixed 3.45-6.43 1,860 (702) (773) (385) –
Liquid funds Fixed 2.27 – – 23 – 23
Liquid funds Floating 0-7.45 13,436 – – – 13,436
Bank overdrafts Floating 0-9.25 (54) – – – (54)
Notes to the Accounts Supplementary Information