Outstanding loans

Fabege employs long-term credit lines with fixed terms and conditions.

Fabege employs long-term credit facilities subject to fixed terms and conditions. The company’s creditors mainly comprise the major Nordic banks.

Interest-bearing liabilities at year-end totalled SEK 21,978m (21,068), with an average interest rate of 2.54 per cent excluding and 2.64 per cent including commitment fees on the undrawn portion of committed credit facilities. Unutilised committed credit facilities amounted to SEK 1,891m.

In 2016, Fabege secured green financing of SEK 4bn and total green frameworks now amount to almost SEK 5bn. The green loans finance environmentally-certified properties. A welcome break in the trend occurred in the fourth quarter, when the first green bank loan with a lower margin for the green portion of the loan was secured. Through the establishment of an MTN programme subject to special conditions with regard to sustainability and the environment, Fabege launched a new green financing opportunity on the capital market in April of SEK 2,000m. An initial issue of SEK 600m was carried out in May, and a second of SEK 300m with a maturity of two years was carried out in November. In the fourth quarter, Fabege also issued an additional green bond of SEK 700m with a maturity of two years within the framework of the co-owned company Svensk FastighetsFinansiering AB (SFF). In addition to this, the company has previous green financing from the European Investment Bank, along with a green bank loan. At year-end, green financing totals 19 per cent of outstanding loans, or 21 per cent of total loan facilities. As the company’s properties gain environmental certification, the objective is for financing to be sustainable as well, and Fabege welcomes and encourages the new responsible financing opportunities that are being established on the market.

On 31 December, Fabege had outstanding bonds of SEK 2,248m via SFF, of which SEK 1,566m related to green bonds. Fabege has a commercial paper programme of SEK 5,000m, which was fully subscribed at the end of the year. Fabege has available credit facilities covering all outstanding commercial paper at any given time.

At 31 December, the average maturity was 3.8 years and the loan-to-value ratio was 46 per cent.

The average fixed-interest term for Fabege’s loan portfolio was 2.2 years, including the effects of derivative instruments. The average fixed-interest term for variable-interest loans was 84 days. At year-end, Fabege’s derivatives portfolio comprised interestrate swaps totalling SEK 8,800m with terms of maturity extending through 2026 and carrying fixed interest at annual rates of between 0.26 and 2.73 per cent before margins. Fabege also holds callable swaps totalling SEK 5,100m at interest rates of between 2.87 and 3.98 per cent before margins and with maturity between 2017 and 2018. Interest rates on 63 per cent of Fabege’s loan portfolio were fixed using fixed-income derivatives. The derivatives portfolio is measured at market value and the change in value is recog-nised in profit or loss. At 31 December, the recognised negative fair value adjustment of the portfolio was SEK 559m (658). The derivatives portfolio is measured at the present value of future cash flows. The change in value is of an accounting nature and has no impact on the company’s cash flow. At the due date, the market value of derivative instruments is always zero.

Net financial items included other financial expenses of SEK 44m, mainly pertaining to accrued opening charges for credit agreements and bond programmes. The total loan volume per quarter included SEK 2,553m (2,592) in loans for projects, on which interest of SEK 55m (46) had been capitalised.