Borrowings and credit lines 17

Borrowings are denominated in a variety of currencies in which the Group conducts its business. The largest portions of effective gross borrowings (before liquidity swaps for cash management purposes) as at December 31, 2010 are denominated in euros (2010: 55%; 2009: 61%) and US dollars (2010: 40%; 2009: 33%).

The weighted average interest rate on the Group’s gross borrowings remained stable at 5.1% in 2010 (2009: 5.2%).

As at December 31, 2010, the Group had cash credit lines and other long-term financing arrangements totalling € 5.5 billion (2009: € 5.9 billion); thereof unused credit lines accounted for € 3.9 billion (2009: € 4.1 billion). In addition, the Group had separate lines for the issuance of letters of credit and guarantees in an amount of approximately € 0.3 billion (2009: € 0.4 billion).

The Group’s outstanding financings are unsecured and may include standard financial covenants, which are reviewed on a quarterly basis. These covenants may include limits on the disposal of fixed assets, the maximum amount of debt secured by liens, cross default provisions and change of control. In addition, certain financial arrangements contain equity ratio covenants, minimum equity covenants as well as net loss covenants.

As of December 31, 2010, and December 31, 2009, actual shareholders’ equity was well above the amount of the minimum equity covenant. Likewise, the relevant amount of net income clearly exceeded net loss covenants.

The amounts disclosed as borrowings represent outstanding borrowings under the following arrangements with aggregated expiration dates as follows:

In accordance with the long-term funding strategy, the bank borrowings with short-term maturities are also classified as long-term borrowings as they represent permanent funding volumes that are covered by the committed mid-term syndicated loan.

For further details on future cash outflows see Risk and Opportunity Report.