[34] Financial risk reporting

Capital management

Ensuring permanent liquidity is one of the primary objectives of capital management. Measures aimed at achieving these objectives include the optimisation of the capital structure, the reduction of liabilities and ongoing Group cash flow planning and management. The long-term financing requirements were secured through the supplementary agreement to the existing SFA (see 'Credit terms' table).

Close cooperation between local units and the Group head office ensures that the local legal and regulatory requirements faced by foreign group companies are considered in the capital management process.

Bank debt net of borrowing costs – defined as the difference between liabilities to banks and cash and cash equivalents – is the key performance measure used in liquidity planning at Group level. Lease liabilities and other financial liabilities are excluded from this figure, which was €2,640,829 thousand in 2010 (2009: €2,484,299 thousand).

Credit risk

Liquidity risk

Default risk

Risks from financial services

Exchange rate risk

Interest rate risk

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