44.3 Borrowings

44.3.1 Long-term borrowings (including the portion falling due within 12 months) - €52,687 million

The following table reports the carrying amount and fair value for each category of long-term debt and interest rate, including the portion falling due within 12 months.

Millions of euro Nominal value Carrying amount Current portion Portion due in more than 12 months Fair value Nominal value Carrying amount Current portion Portion due in more than 12 months Fair value Changes in carrying amount
  at Dec. 31, 2020 at Dec. 31, 2019  
Bonds:                      
- listed, fixed rate 23,629 23,052 1,041 22,011 27,470 27,312 26,593 1,621 24,972 31,073 (3,541)
- listed, floating rate 2,817 2,800 260 2,540 2,937 3,515 3,488 258 3,230 3,655 (688)
- unlisted, fixed rate 13,262 13,184 - 13,184 15,753 14,458 14,359 - 14,359 15,794 (1,175)
- unlisted, floating rate 733 733 111 622 828 760 760 27 733 753 (27)
Total bonds 40,441 39,769 1,412 38,357 46,988 46,045 45,200 1,906 43,294 51,275 (5,431)
Bank borrowings:                      
- fixed rate 790 782 254 528 833 896 893 279 614 947 (111)
- floating rate 9,278 9,250 1,115 8,135 9,259 8,610 8,565 842 7,723 8,642 685
- use of revolving credit lines - - - - - 70 70 - 70 70 (70)
Total bank borrowings 10,068 10,032 1,369 8,663 10,092 9,576 9,528 1,121 8,407 9,659 504
Leases:                      
- fixed rate 1,979 1,979 225 1,754 1,979 1,856 1,856 257 1,599 1,856 123
- floating rate 89 89 22 67 89 108 108 18 90 108 (19)
Total leases 2,068 2,068 247 1,821 2,068 1,964 1,964 275 1,689 1,964 104
Other non-bank borrowings:                      
- fixed rate 607 639 74 565 630  792 822 92 730 811 (183)
- floating rate 191 179 66 113 160 86 69 15 54 75 110
Total other non-bank borrowings 798 818 140 678 790 878 891 107 784 886 (73)
Total fixed-rate borrowings 40,267 39,636 1,594 38,042 46,665 45,314 44,523 2,249 42,274 50,481 (4,887)
Total floating-rate borrowings 13,108 13,051 1,574 11,477 13,273 13,149 13,060 1,160 11,900 13,303 (9)
TOTAL 53,375 52,687 3,168 49,519 59,938 58,463 57,583 3,409 54,174 63,784 (4,896)


The table below reports long-term financial debt by currency and interest rate.

LONG-TERM FINANCIAL DEBT BY CURRENCY AND INTEREST RATE

Millions of euro Carrying amount Nominal value Carrying amount Nominal value Current average nominal interest rate Current effective
interest rate
  at Dec. 31, 2020 at Dec. 31, 2019 at Dec. 31, 2020
Euro 25,581 26,089 27,272 27,915 2.2% 2.6%
US dollar 18,500 18,589 20,103 20,239 4.5% 4.7%
Pound sterling 3,955 3,998 4,354 4,394 5.1% 5.3%
Colombian peso 1,283 1,283 1,381 1,381 6.8% 6.8%
Brazilian real 1,832 1,864 2,412 2,458 5.3% 5.3%
Swiss franc 328 329 419 419 1.8% 1.8%
Chilean peso/UF 368 374 414 421 4.9% 5.0%
Peruvian sol 388 388 426 426 5.8% 5.8%
Russian ruble 281 286 225 227 7.1% 7.1%
Other currencies 171 175 577 583    
Total non-euro currencies 27,106 27,286 30,311 30,548    
TOTAL 52,687 53,375 57,583 58,463    


Long-term financial debt denominated in currencies other than the euro decreased by €3,205 million, largely attributable to the positive effect of the exchange rates of the main currencies.

CHANGE IN THE NOMINAL VALUE OF LONG-TERM DEBT

Millions of euro Nominal value Repayments Change in the consolidation scope New issues Other changes Exchange differences Nominal value
  at Dec. 31, 2019                 at Dec. 31, 2020
Bonds 46,045 (2,109) - 668 (1,797) (2,366) 40,441
Borrowings 12,418 (1,638) (389) 3,256 (48) (665) 12,934
- of which leases 1,964 (208) - 441 - (129) 2,068
Total financial debt 58,463 (3,747) (389) 3,924 (1,845) (3,031) 53,375


The nominal value of long-term debt amounted to €53,375 million at December 31, 2020, a decrease of €5,088 million compared with December 31, 2019. The increase in debt deriving from new issues of €3,924 million was easily offset by reductions associated with repayments in the amount of €3,747 million, exchange gains of €3,031 million, the deconsolidation of the debt of a number of South African companies in the amount of €389 million (that amount is net of new issues in 2020 by the deconsolidated companies) and other changes in debt totaling €1,845 million. This value includes €1,797 million reflecting the accounting effects of the consent solicitation directed at the holders of three non-convertible subordinated hybrid bonds denominated in euros in order to align their features with those of new issues. More specifically, the main change to those instruments regarded their maturity, which was transformed from fixed to perpetual, which means that they will be redeemed only in the event of liquidation. As a result, those bonds are no longer recognized as debt instruments but as equity instruments.

Repayments in 2020 concerned bonds in the amount of €2,109 million and borrowings totaling €1,638 million.

More specifically, the main bonds maturing in 2020 included:

  • €410 million in respect of a fixed-rate hybrid bond issued by Enel SpA, maturing in January 2020;
  • €100 million in respect of a fixed-rate bond issued by Enel Finance International, maturing in January 2020;
  • €482 million in respect of a fixed-rate bond issued by Enel Finance International, maturing in March 2020;
  • the equivalent of €93 million in respect of a fixed-rate bond in Swiss francs issued by Enel Finance International, maturing in June 2020;
  • the equivalent of €438 million in respect of a fixed-rate bond in pounds sterling issued by Enel SpA, maturing in September 2020;
  • the equivalent of €274 million in respect of a fixed-rate hybrid bond in pounds sterling repurchased early by Enel SpA in September 2020;
  • the equivalent of €286 million in respect of bonds issued by the Latin American companies.

The main repayments of borrowings in the year included the following:

  • €150 million in respect of a floating-rate loan of Enel SpA;
  • €182 million in respect of loan repayments by Endesa;
  • €285 million in respect of loans linked to the achievement of sustainability goals of the Group’s Italian companies;
  • the equivalent of €585 million associated with Latin American companies.

New borrowing carried out in 2020 involved bonds in the amount of €668 million and borrowings of €3,256 million (both translated at the exchange rates prevailing at the issue date).

The table below shows the main characteristics of the most significant financial transactions involving bond issues and bank borrowings carried out in 2020 and translated into euros at the exchange rate prevailing at December 31, 2020:

  Issuer/Borrower Issue/Grant date Amount in millions of euro Currency Interest rate Interest rate type Maturity
Bonds              
  Enel Finance International 20.10.2020 557 GBP 1.00% Fixed rate 20.10.2027
  Codensa 25.08.2020 60 COP CPI + 2.5% Floating rate 25.08.2027
  Codensa 25.08.2020 60 COP 4.700% Fixed rate 25.08.2024
Total bonds     677        
Bank borrowings              
  Enel SpA 26.10.2020 500 EUR Euribor 6M + 1% Floating rate 15.10.2026
  Enel SpA 27.11.2020 500 EUR Euribor 6M + 1% Floating rate 15.10.2026
  Enel Finance America 21.01.2020 277 USD LIBOR 6 M + 1.3% Floating rate 20.11.2026
  Endesa 20.04.2020 300 EUR Euribor 3M + 0.7% Floating rate 19.04.2022
  e-distribuzione 30.03.2020 250 EUR Euribor 6M + 0.42% Floating rate 30.03.2035
  Dolores Wind SA de Cv 09.03.2020 57 USD LIBOR 6 M + 1.4% Floating rate 15.01.2027
  Enel Distribuição São Paulo 17.04.2020 71 USD 2.96% Fixed rate 19.04.2021
  Enel Rus Wind Kola 27.03.2020 39 RUB OFZ 3Y+ 1.55% Floating rate 26.02.2034
  Endesa 01.09.2020 35 EUR Euribor 6M + 0.51% Floating rate 03.09.2035
  Parque Amistad IV SA de Cv 09.03.2020 33 USD LIBOR 6 M + 1.4% Floating rate 15.01.2027
  EGP Magdalena Solar SA de Cv 09.03.2020 33 USD LIBOR 6 M + 1.4% Floating rate 15.01.2027
  Enel Distribuição Ceará 07.01.2020 30 USD 2.1% Fixed rate 07.01.2021
  Enel Distribuição Goiás 06.03.2020 27 USD 1.8% Fixed rate 08.03.2021
  Enel Distribuição Rio de Janeiro 23.12.2020 32 USD 1.4% Fixed rate 23.12.2022
Total bank borrowings     2,184        


The Group’s main long-term financial liabilities are governed by covenants that are commonly adopted in international business practice. These liabilities primarily regard the bond issues carried out within the framework of the Global/Euro Medium-Term Notes program, issues of subordinated unconvertible hybrid bonds (so-called “hybrid bonds”) and loans granted by banks and other financial institutions (including the European Investment Bank and Cassa Depositi e Prestiti SpA).

The main covenants regarding bond issues carried out within the framework of the Global/Euro Medium-Term Notes program of (i) Enel and Enel Finance International NV (including the green bonds of Enel Finance International NV guaranteed by Enel SpA, which are used to finance the Group’s so-called eligible green projects) and those regarding bonds issued by Enel Finance International NV on the US market guaranteed by Enel SpA can be summarized as follows:

  • negative pledge clauses under which the issuer and the guarantor may not establish or maintain mortgages, liens or other encumbrances on all or part of its assets or revenue to secure certain financial liabilities, unless the same encumbrances are extended equally or pro rata to the bonds in question;
  • pari passu clauses, under which the bonds and the associated security constitute a direct, unconditional and unsecured obligation of the issuer and the guarantor and are issued without preferential rights among them and have at least the same seniority as other present and future unsubordinated and unsecured bonds of the issuer and the guarantor;
  • cross-default clauses, under which the occurrence of a default event in respect of a specified financial liability (above a threshold level) of the issuer, the guarantor or, in some cases, “significant” subsidiaries, constitutes a default in respect of the liabilities in question, which become immediately repayable.

Since 2019, Enel Finance International NV has issued a number of “sustainable” bonds on the European market (as part of the Euro Medium Term Notes - EMTN bond issue program) and on the American market, both guaranteed by Enel SpA, linked to the achievement of a number of the Sustainable Development Goals (SDGs) of the United Nations that contain the same covenants as other bonds of the same type.

The main covenants covering Enels hybrid bonds, including the perpetual hybrid bond issues in September, which will be repaid in the event of the dissolution or liquidation of the Company, can be summarized as follows:

  • subordination clauses, under which each hybrid bond is subordinate to all other bonds issued by the company and has the same seniority with all other hybrid financial instruments issued, being senior only to equity instruments;
  • prohibition on mergers with other companies, the sale or leasing of all or a substantial part of the companys assets to another company, unless the latter succeeds in all obligations of the issuer.

The main covenants envisaged in the loan contracts of Enel and Enel Finance International NV and the other Group companies, including the sustainability-linked loan facility agreements obtained by Enel in 2019 and 2020, can be summarized as follows:

  • negative pledge clauses, under which the borrower and, in some cases, the guarantor are subject to limitations on the establishment of mortgages, liens or other encumbrances on all or part of their respective assets, with the exception of expressly permitted encumbrances;
  • disposals clauses, under which the borrower and, in some cases, the guarantor may not dispose of their assets or operations, with the exception of expressly permitted disposals;
  • pari passu clauses, under which the payment undertakings of the borrower have the same seniority as its other unsecured and unsubordinated payment obligations;
  • change of control clauses, under which the borrower and, in some cases, the guarantor could be required to renegotiate the terms and conditions of the financing or make compulsory early repayment of the loans granted;
  • rating clauses, which provide for the borrower or the guarantor to maintain their rating above a certain specified level;
  • cross-default clauses, under which the occurrence of a default event in respect of a specified financial liability (above a threshold level) of the issuer or, in some cases, the guarantor constitutes a default in respect of the liabilities in question, which become immediately repayable.

In some cases the covenants are also binding for the significant companies or subsidiaries of the obligated parties. All the borrowings considered specify “events of default” typical of international business practice, such as, for example, insolvency, bankruptcy proceedings or the entity ceases trading.

In addition, the guarantees issued by Enel in the interest of e-distribuzione SpA for certain loans to e-distribuzione SpA from Cassa Depositi e Prestiti SpA require that at the end of each six-month measurement period that Enel’s net consolidated financial debt shall not exceed 4.5 times annual consolidated EBITDA.

Finally, the debt of Endesa SA, Enel Américas SA, Enel Chile SA and the other Spanish and Latin American subsidiaries (notably Enel Generación Chile SA) contain covenants and events of default typical of international business practice, which had all been complied with as at December 31, 2020.

The following table reports the impact on gross long-term debt of hedges to mitigate currency risk.

LONG-TERM FINANCIAL DEBT BY CURRENCY AFTER HEDGING

Millions of euro at Dec. 31, 2020 at Dec. 31, 2019
  Initial debt structure Impact of hedge Debt structure after hedging Initial debt structure Impact of hedge Debt structure after hedging
  Carrying amount Nominal value %       Carrying amount Nominal value %      
Euro 25,581 26,089 48.9% 18,423 44,512 83.4% 27,272 27,915 47.8% 20,218 48,133 82.3%
US dollar 18,500 18,589 34.8% (14,955) 3,634 6.8% 20,103 20,239 34.6% (16,445) 3,794 6.5%
Pound sterling 3,955 3,998 7.5% (3,998) - - 4,354 4,394 7.5% (4,394) - -
Colombian peso 1,283 1,283 2.4% - 1,283 2.4% 1,381 1,381 2.4% - 1,381 2.4%
Brazilian real 1,832 1,864 3.5% 794 2,658 5.0% 2,412 2,458 4.2% 968 3,426 5.9%
Swiss franc 328 329 0.6% (329) - - 419 419 0.7% (419) - -
Chilean peso/UF 368 374 0.7% - 374 0.7% 414 421 0.7% - 421 0.7%
Peruvian sol 388 388 0.7% - 388 0.7% 426 426 0.7% - 426 0.7%
Russian ruble 281 286 0.5% - 286 0.5% 225 227 0.4% - 227 0.4%
Other currencies 171 175 0.4% 65 240 0.5% 577 583 1.0% 72 655 1.1%
Total non-euro currencies 27,106 27,286 51.1% (18,423) 8,863 16.6% 30,311 30,548 52.2% (20,218) 10,330 17.7%
TOTAL 52,687 53,375 100.0% - 53,375 100.0% 57,583 58,463 100.0% - 58,463 100.0%


The amount of floating-rate debt that is not hedged against interest rate risk is a risk factor that could impact the income statement (raising borrowing costs) in the event of an increase in market interest rates.

Millions of euro 2020 2019
  Pre-hedge % Post-hedge % Pre-hedge % Post-hedge %
Floating rate 19,458 32.6% 13,672 22.9% 17,113 27.4% 12,208 19.6%
Fixed rate 40,267 67.4% 46,053 77.1% 45,314 72.6% 50,219 80.4%
Total 59,725   59,725   62,427   62,427  


At December 31, 2020, 32.6% of financial debt was floating rate (27.4% at December 31, 2019). Taking account of hedges of interest rates considered effective pursuant to the IFRS-EU, 22.9% of net financial debt at December 31, 2020 (19.6% at December 31, 2019) was exposed to interest rate risk. Including interest rate derivatives treated as hedges for management purposes but ineligible for hedge accounting, the percentage of net financial debt hedged at December 31, 2020 was unchanged compared with the previous year.

These results are in line with the limits established in the risk management policy.

44.3.2 Short-term borrowings - €6,345 million

At December 31, 2020 short-term borrowings amounted to €6,345 million, an increase of €2,428 million on December 31, 2019. They break down as follows.

Millions of euro      
  at Dec. 31, 2020 at Dec. 31, 2019 Change
Short-term bank borrowings 711 579 132
Commercial paper 4,854 2,284 2,570
Cash collateral and other financing on derivatives 370 750 (380)
Other short-term borrowings (1) 410 304 106
Short-term borrowings 6,345 3,917 2,428

(1) Does not include current borrowings included in other current financial liabilities.

Commercial paper amounted to €4,854 million, issued by Enel Finance International, Enel Finance America and Endesa.

The main commercial paper programs include:

  • €6,000 million of Enel Finance International;
  • €4,000 million of Endesa;
  • $3,000 million (equivalent to €2,445 million at December 31, 2020) of Enel Finance America.

During 2020 Enel Finance International and Endesa structured commercial paper programs linked to sustainability goals and at December 31, 2020 these issues totaled €3,901 million.