The choice of the respective financial instruments is according to Lufthansa‘s financial strategy. The financing mix aims at reducing the costs of financing, maintaining a balanced maturity profile and diversifying the portfolio of creditors. Especially due to the good credit-worthiness a broad variety of financing instruments is available to Lufthansa Group. In this connection, aircraft financing plays a fundamental role since it leads to very beneficial financing conditions in combination with the good credit-worthiness. In addition, funds especially unsecured bonds and promissory notes are raised through capital markets on a regular basis.
Its creditor relations activities enable the Lufthansa Group to stay in permanent contact with lenders worldwide, and thereby strengthen its investor base. Borrowing mainly takes place in euros, the reporting currency.
Bilateral lines of credit
Furthermore, Lufthansa Group has bilateral credit lines with a large number of banks which came to EUR 774m (as per 31 December 2019). None of the financial means of these lines of credit had been used as per 31 December 2019. These credit lines serve as an additional liquidity reserve for Deutsche Lufthansa AG.
Lufthansa‘s good credit-worthiness creates trust for the investors and creditors. Based on a solid financial profile, Lufthansa is able to make use of diverse forms of funding. Furthermore, the good credit-worthiness is the prerequisite for financial flexibility and low financing costs.