MISC Annual Report 2017

NOTES TO THE FINANCIAL STATEMENTS MISC BERHAD | Annual Report 2017 240 18. OTHER FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONT'D.) (b) Derivative assets/liabilities Group 2017 RM'000 2016 RM'000 Derivative assets Current: Interest rate swaps ("IRS") - effective hedges (i) 4,406 - Non-current: IRS - effective hedges (ii) 3,328 1,472 Derivative liabilities Current: Currency hedge - effective hedges (iii) - 6,655 Non-current: IRS - effective hedges (ii) - 691 (i) On 22 June 2015, the Group entered into a USD300.0 million interest rate swap arrangement to hedge 50% of its subsidiary's outstanding USD term loan facility. Under this arrangement, the Group pays fixed interest rate of 1.31% per annum and receives cash flows at floating rates. The notional amount of the interest rate swap arrangement as at 31 December 2017 was RM1,217,850,000 (2016: RM1,345,350,000) and will mature on 20 September 2018. (ii) (a) On 6 August 2015, the Group entered into a USD52.5 million interest rate swap arrangement to hedge 25% of its subsidiary's USD term loan facility. Under this arrangement, the Group pays fixed interest rate of 1.90% per annum and receives cash flows at floating rates. The notional amount of the interest rate swap as at 31 December 2017 was RM168,298,000 (2016: RM241,693,000) and will mature on 6 May 2022. On 4 January 2016, the Group entered into an interest rate swap arrangement to hedge 23% of its subsidiary's USD term loan facility. Under this arrangement, the Group pays fixed interest rate of 1.96% per annum and receives cash flows at floating rates. The notional amount of the interest rate swap as at 31 December 2017 was RM160,838,000 (2016: RM217,797,000) and will mature on 4 July 2022. (b) In the current financial year, the Group entered into an interest rate swap arrangement to hedge 50% of its subsidiary's USD term loan facility. Under this arrangement, the Group pays fixed interest rate of 2.29% per annum and receives cash flows at floating rates. The notional amount of the interest rate swap as at 31 December 2017 was RM598,447,000 and will mature on 27 June 2029. (iii) As at previous financial year, the Group held forward currency contracts designated as hedges of expected future receipts and payments denominated in United States Dollars. The net notional amount of the currency hedging arrangement as at 31 December 2016 was RM63,550,000. The forward currency contracts matured in current year.