32. Derivative Financial Instruments

The fair value of the derivative financial instruments is as follows:

in thousands of EUR

31 December 2015

31 December 2014

Assets

Liabilities

Assets

Liabilities

Interest rate derivatives – cash flow hedges

-

1,922

-

4,025

Currency derivatives – cash flow hedges

1,201

1,162

800

20

Currency derivatives – fair value hedges

-

-

91

-

Total

1,201

3,084

891

4,045

Less non-current portion:

Interest rate derivatives – cash flow hedges

-

1,039

-

2,508

Current portion

1,201

2,045

891

1,537

The valuation of the derivatives is based on valuations provided by banks and third parties. In note 3.1.3 the maturity of the expected cash flows to occur is shown.

Interest rate derivatives

The nominal amount of the bank borrowings (see note 26) hedged by interest rate derivatives amounts to €470 million (2014: €420 million). In addition €150 million (2014: €0) of 0% floors are outstanding to prevent the impact of negative interest rate. The interest derivatives meet the requirements for hedge accounting in full.

Currency derivatives

The Group has transactional cash flows in multiple currencies and is exposed to the volatility of these currencies against the euro. The treasury policy is to hedge between 25% and 80% of the transactional cash flows based on a rolling 12-month forecast. Derivative financial instruments are aimed at reducing the exposure to adverse currency change. Some of the currency derivatives qualify for hedge accounting. The fair value is recorded in the hedging reserve in equity for the effective part and in the Income Statement for the ineffective part. At the end of 2015 the notional principal amounts of the outstanding forward foreign exchange contracts were:

in thousands of EUR

31 December 2015

31 December 2014

Currency

United States Dollar (USD)

40,652

24,134

Polish Zloty (PLN)

10,637

2,893

Swedish Krona (SEK)

10,101

-

British Pound Sterling (GBP)

9,098

-

Norwegian Krone (NOK)

8,369

-

Danish Krone (DKK)

6,002

-

Turkish Lira (TRY)

5,221

-

Hungarian Forint (HUF)

4,099

300

Czech Koruna (CZK)

3,985

4,176

Swiss Franc (CHF)

653

1,159

Russian Ruble

353

-

Chilean Peso (CLP)

-

1,366

All these foreign exchange deals are partially hedging underlying forecasted transactions of Group entities in the corresponding foreign currency. The remaining currency derivatives that do not qualify for hedge accounting have been classified as fair value derivatives, which hedge monetary items.