4.4 Legal risk - Scor

SCOR has entered into a cross-currency swap which exchanges the principal into EUR and exchanges the CHF coupon on
the notes to EUR 6.925% and matures on 2 August 2016. Refer to Note 8 – Derivative Instruments for Currency Swap fair
values.
This instrument is recognized as debt because under the terms and conditions of the issuance contract, SCOR does not
have an unconditional right to avoid delivering cash to settle the contractual obligation and based on projected cash flow
there is no equity component of the instrument.
(f) CHF 315 million perpetual subordinated debt
On 10 September 2012, SCOR issued CHF 250 million perpetual subordinated notes, redeemable by SCOR each quarter
as at payment of interest dates from 8 June 2018. The strong market demand observed prompted the Group to extend its
placements from CHF 250 million to a total of CHF 315 on 24 September 2012. The settlement of the notes took place on 8
October 2012. The coupon has been set to 5.25% (until 2 June 2018) and 3-month CHF LIBOR plus a margin of 4.8167%
thereafter.
SCOR has entered into a cross-currency swap which exchanges CHF 250 million of the principal into EUR and exchanges
the CHF coupon on the notes to EUR 6.2855% and matures on 8 June 2018. SCOR has entered into a second crosscurrency
swap which exchanges CHF 65 million of the principal into EUR and exchanges the CHF coupon on the notes to
EUR 6.2350% and matures on 8 June 2018. Refer to Note 8 – Derivative Instruments for Currency Swap fair values.
This instrument is recognized as debt because under the terms and conditions of the issuance contract, SCOR does not
have an unconditional right to avoid delivering cash to settle the contractual obligation and based on projected cash flow
there is no equity component of the instrument.
OTHER FINANCIAL DEBT
Real estate financing relates to the acquisition of investment properties through property-related bank loans of
EUR 409 million (EUR 419 million as at 31 December 2011) including EUR 3 million of financial lease contract (2011:
EUR 10 million). The main property related bank loan amounts to EUR 170 million and is used to finance the Group’s headoffice
in Paris, at Kléber. It bears interest indexed to the 3-month Euribor rate plus 1.35% and is redeemable in June 2018.
SCOR entered into three interest rate swaps which cover its exposure to the variable interest rate whereas SCOR pays
fixed 2.97% and receives three-months Euribor. The interest rate swaps have been accounted for as cash flow hedges (for
further detail refer to Note 8 – Derivative instruments). The other property-related bank loans bear interests indexed to the
3 - month Euribor and redeemable between 2016 and 2021. They are used to finance other buildings owned by the Group.
Other financial debt relates to deposit and guarantees of EUR 26 million (EUR 14 million as at 31 December 2011).
FINANCING EXPENSES
In EUR million 2012 2011 2010
Interest on subordinated debt (4) (4) (4)
Interest on perpetual subordinated debt (56) (47) (17)
Atlas V and VI (set up costs) (2) (3) (2)
Finance lease (2) (2) (3)
Real estate Financing (18) (8) (5)
Other financial costs (1) (24) (30) (15)
TOTAL (106) (94) (46)
(1) The amounts presented in other financial costs include certain other Letter Of Credit charges, custodian and overdraft fees, amortization of issuance fees and other
bank charges (commissions, etc), and a gain on debt repurchase in 2012 for EUR 10 million
MATURITY
The maturity profiles of financial debt is included in Note 26 – Insurance and financial risk.
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