29 Financial Assets
Financial Assets
Dec. 31, 2022 | Dec. 31, 2023 | ||||||||
in € million | non-current | current | non-current | current | |||||
thereof due between 2 and 3 years | 165.5 | 49.4 | 906.2 | 4.5 | |||||
Loans to associated companies | 109.7 | 672.1 | 149.5 | 664.8 | |||||
Other current financial receivables from financial transactions | – | – | – | 318.1 | |||||
Other investments | 396.1 | – | 317.3 | – | |||||
Other non-current loans | 11.5 | 44.1 | 21.6 | 18.1 | |||||
Loans to other investments | 33.1 | – | 38.0 | – | |||||
Receivables from finance leases | 21.1 | 2.6 | 13.4 | 2.3 | |||||
Non-consolidated subsidiaries | 2.5 | – | 4.4 | – | |||||
Securities | 5.5 | – | 5.9 | – | |||||
745.0 | 768.2 | 1,456.3 | 1,007.8 | ||||||
Accounting Policies
Financial assets are recognized in the balance sheet when Vonovia becomes a contracting party of the financial instrument. A financial asset is derecognized when the contractual rights to the cash flows from a financial asset expire, or the financial asset is transferred and Vonovia neither retains control nor retains material risks and rewards associated with ownership of the financial asset.
In accordance with IFRS 9, the classification of financial assets takes into account both the business model in which financial assets are held and the characteristics of the cash flows of the assets in question. These criteria determine whether the assets are measured at amortized cost using the effective interest method or at fair value.
With regard to the business model criterion, all financial investments at Vonovia are to be assigned to the “hold to collect” model pursuant to IFRS 9.4.1.2(a). Whenever financial investments are categorized as equity instruments, Vonovia has exercised the irrevocable option to state future changes to the fair value in other comprehensive income in equity. Gains and losses recognized in other comprehensive income are never reclassified from total equity to the income statement on their disposal.
The carrying amount of financial assets corresponds to maximum risk of loss as of the reporting date.
The increase in financial assets is due primarily to the initial recognition of two new derivatives in the form of long-term options to buy back shares. The first call option arose in the amount of € 374.0 million in connection with the sale of shares in the Südewo portfolio in the first half of 2023 and was adjusted to € 464.0 million, affecting net income, as of the reporting date. The second call option was added to this at the end of the year. It arose in the context of the sale of shares in the northern Germany portfolio and was recognized in the amount of € 374.0 million upon initial recognition.
In a sensitivity analysis, the WACC, as the main influencing factor, was changed by +0.5%/-0.5% for the call options, which would result in a change in equity affecting net income of € -97.0 million/€ +114.0 million. In addition, positive market values from interest rate derivatives in the amount of € 68.2 million (December 31, 2022: € 165.5 million) were reported under non-current derivatives.
The loans to associates relate exclusively to loan receivables from the QUARTERBACK Immobilien Group that are recognized after taking account of an expected credit loss. The loans were granted in line with standard market conditions. The change is due to loan repayments and, on the other hand, new loans taken out with a maturity of more than twelve months.
Other current financial receivables from financial transactions include time deposits and short-term financial investments in highly liquid money market funds that have an original term of more than three months.
Other investments comprise shares in Vesteda Residential Fund FGR, Amsterdam, in the amount of € 165.9 million (December 31, 2022: € 188.2 million) and shares in Gropyus AG, Vienna, in the amount of € 78.7 million (December 31, 2022: € 32.1 million). The investment in OPPCI JUNO, Paris, was sold in the first quarter of 2023.
The loans to other investments not yet due largely relate to a loan to the property fund DB Immobilienfonds 11 Spree-Schlange von Quistorp KG.
The receivables from finance leases are mainly due to the rental of certain broadband cable networks. There were receivables of € 15.7 million (December 31, 2022: € 23.7 million) and interest income of € 0.7 million on the reporting date (December 31, 2022: € 1.1 million). The debt maturity profile of the receivables is as follows:
Debt maturity profile of receivables from finanace leases
in € million | Dec. 31, 2022 | Dec. 31, 2023 | |||
Nominal value of outstanding lease payments | 28.2 | 17.2 | |||
thereof due within one year | 3.5 | 2.6 | |||
thereof due between 1 and 2 years | 3.6 | 2.2 | |||
thereof due between 2 and 3 years | 3.0 | 2.2 | |||
thereof due between 3 and 4 years | 3.0 | 2.1 | |||
thereof due between 4 and 5 years | 3.0 | 2.1 | |||
thereof due after more than 5 years | 12.1 | 6.0 | |||
plus unguaranteed residual values | 0.2 | 0.2 | |||
less unrealized financial income | -4.7 | -1.7 | |||
Present value of outstanding lease payments | 23.7 | 15.7 | |||