NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 DECEMBER 2022 24 BONDS AND NOTES (CONT’D) Unless previously redeemed or purchased and cancelled, the bond is redeemable at its principal amount on its maturity date in September 2025. Following the Group’s distribution in specie of part of the CDLHT units that it held, to the Company’s ordinary shareholders, CDLHT was deconsolidated and became an associate of the Group (notes 40, 44 and 45). Unsecured bonds and notes comprise $1,975 million (2021: $2,075 million) medium term notes (MTNs) which comprise 10 series (2021: 11 series) of notes issued by the Company at various interest rates as part of a $5.0 billion unsecured MTN programme established in 1999. The MTNs bore interest at 2.00% to 3.90% (2021: 2.00% to 3.90%) per annum as at 31 December 2022. Unless previously redeemed or purchased and cancelled, the MTNs are redeemable at their principal amounts on their respective maturity dates from April 2023 to June 2026 (2021: July 2022 to June 2026). 25 BANK LOANS Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Bank loans repayable within 1 year – secured 10,362 1,648 – – – unsecured 1,097,877 989,911 874,187 576,444 22 1,108,239 991,559 874,187 576,444 The Group’s secured bank loans bore interest at 2.97% to 5.08% (2021: 3.00% to 3.44%) per annum as at 31 December 2022. The loans are secured by mortgages on the borrowing subsidiary’s property, plant and equipment and a pledge on cash deposits (note 18). The Group’s unsecured bank loans bore interest at 0.71% to 5.51% (2021: 0.38% to 3.46%) per annum as at 31 December 2022. The Company’s unsecured bank loans bore interest at 0.71% to 5.51% (2021: 0.45% to 3.46%) per annum as at 31 December 2022. 26 EMPLOYEE BENEFITS Group Company 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Net liability for: – defined benefit obligations 7,276 24,534 – – – short-term accumulating compensated absences 28,196 32,949 1,960 2,960 – other long-term benefits 395 730 – – 35,867 58,213 1,960 2,960 Non-current 7,304 24,637 – – Current 28,563 33,576 1,960 2,960 35,867 58,213 1,960 2,960 24 BONDS AND NOTES Group Company Note 2022 2021 2022 2021 $’000 $’000 $’000 $’000 Secured 680,015 740,676 – – Unsecured 1,971,771 2,070,486 1,971,771 2,070,486 22 2,651,786 2,811,162 1,971,771 2,070,486 Secured bonds and notes comprise the following: (i) $101 million (2021: $118 million) bonds comprising 2 tranches issued by a subsidiary, which holds a Japan hotel (classified under investment properties) through a TMK structure. The bonds bore interest at 0.31% to 0.46% (2021: 0.30% to 0.47%) per annum as at 31 December 2022. The bondholders, under Article 128 of the Japan Asset Liquidation Law, are under a statutory lien to receive payment of their claims under the bonds prior to other creditors out of the assets of the TMK. The order of priority of such statutory lien shall be immediately after the general statutory liens under the Japan Civil Code. While the assets of the TMK are subject to a statutory preferred right, it is not considered a mortgage under Japan laws. Unless previously redeemed or purchased and cancelled, the bond is redeemable at its principal amount on its maturity date in March 2025. (ii) $530 million (2021: $530 million) medium term notes (MTNs) which comprise 2 series (2021: 2 series) of notes issued by a subsidiary as part of a $700 million secured MTN programme established in 2001. The MTNs bore interest at 1.65% to 2.96% (2021: 1.65% to 2.96%) per annum as at 31 December 2022 and are secured by a mortgage over an investment property as well as rental and insurance proceeds to be derived from the said property. Unless previously redeemed or purchased and cancelled, the MTNs are redeemable at their principal amounts on their respective maturity dates from May 2024 to December 2025 (2021: May 2024 to December 2025). (iii) $51 million (2021: $59 million) bond issued by a subsidiary, which holds a Japan development property through a TMK structure. The bond bore interest at 0.37% (2021: 0.37% to 0.39%) per annum as at 31 December 2022. Unless previously redeemed or purchased and cancelled, the bond is redeemable at its principal amount on its maturity date in March 2023. The bondholders, under Article 128 of the Japan Asset Liquidation Law, are under a statutory lien to receive payment of their claims under the bonds prior to other creditors out of the assets of the TMK. The order of priority of such statutory lien shall be immediately after the general statutory liens under the Japan Civil Code. While the assets of the TMK are subject to a statutory preferred right, it is not considered a mortgage under Japan laws. In addition, as at 31 December 2021, secured bonds and notes included $37 million bond issued by an indirectly owned subsidiary of CDLHT. The bond bore interest at a rate of 0.71% per annum. CDLHT’s interest in 2 Japan hotels (classified under property, plant and equipment) was held through a Tokutei Mokutei Kaisha (TMK) structure, and such TMK structures are required to issue bonds to fund the acquisition of assets. The bondholders had a statutory preferred right, under Article 128 of the Japan Asset Liquidation Law, to receive payment of all obligations under the bond prior to other creditors out of the assets of the TMK. Such right shall be junior to the priority of the general statutory lien under the Japan Civil Code. While the assets of the TMK are subject to a statutory preferred right, it is not considered a mortgage under Japan laws. CITY DEVELOPMENTS LIMITED ANNUAL REPORT 2022 FINANCIALS 186 187
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