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Derivatives

12 Months Ended

Dec. 31, 2018

Derivatives [Abstract]

Derivatives

14. Derivatives

(1) Derivatives as of December 31, 2017 and 2018 are as follows:

						2017								2018
						Current				Non-current				Current				Non-current
						In millions of won
Derivative assets
Currency forward		￦					45				—				2,128				12,606
Currency swap							12				15,711				39,979				43,436
Interest rate swap							—				2,697				—				2,342
Others(*1)							12,878				1,283				—				1,844
		￦					12,935				19,691				42,107				60,228
Derivative liabilities
Currency forward		￦					7,862				1,278				1,956				—
Currency swap							61,997				296,098				14,881				233,690
Interest rate swap							1,408				59,416				1,439				58,042
Others(*2)							—				—				2,155				—
		￦					71,267				356,792				20,431				291,732

(*1) The Company has a put option to sell shares of DS POWER Co., Ltd. and the fair value of the option is recorded in ‘Others’.

(*2) The Company has an obligation to settle the convertible preferred stock to financial investors pursuant to the settlement contract with Samcheok Eco Materials Co., Ltd. and the fair value of the obligation is recorded in ‘Others’.

(2) Currency forward contracts which are not designated as hedge instruments as of December 31, 2018 are as follows:

		Contract date				Maturity date				Contract amounts																Contract exchange rate (in won)
Counterparty														Pay				Receive
		In millions of won and thousands of foreign currencies except contract exchange rate information
KEB Hana Bank			2014.04.10				2021.07.12			￦					55,120				USD 52,000			￦					1,060.00
KEB Hana Bank			2014.04.28				2021.07.12								50,784				USD 48,000								1,058.00
Bank of America			2014.04.29				2021.07.12								105,400				USD 100,000								1,054.00
KEB Hana Bank			2014.05.09				2021.07.12								104,600				USD 100,000								1,046.00
KEB Hana Bank			2017.12.22				2021.07.12								105,079				USD 100,000								1,050.79
Korea Development Bank			2017.12.27				2021.07.12								104,849				USD 100,000								1,048.49
Mizuho Bank			2018.11.28				2019.01.02								6,768				USD 6,000								1,127.95
Mizuho Bank			2018.12.07				2019.01.11								11,169				USD 10,000								1,116.90
CCB			2018.12.11				2019.01.14								11,280				USD 10,000								1,127.96
Nonghyup Bank			2018.12.17				2019.01.22								11,295				USD 10,000								1,129.45
Korea Development Bank			2018.12.18				2019.01.22								11,279				USD 10,000								1,127.85
Morgan Stanley			2018.12.19				2019.01.23								11,233				USD 10,000								1,123.30
Standard Chartered			2018.12.19				2019.01.24								11,235				USD 10,000								1,123.50
Kookmin Bank			2018.12.20				2019.01.28								11,273				USD 10,000								1,127.25
Woori Bank			2018.12.20				2019.01.28								11,272				USD 10,000								1,127.15
KEB Hana Bank			2018.12.21				2019.01.29								13,459				USD 12,000								1,121.60
Morgan Stanley			2018.12.24				2019.01.30								11,289				USD 10,000								1,128.87
CCB			2018.12.26				2019.01.31								11,246				USD 10,000								1,124.60
Standard Chartered			2018.12.26				2019.01.31								5,624				USD 5,000								1,124.75
Nonghyup Bank			2018.12.27				2019.02.01								5,610				USD 5,000								1,121.90
KEB Hana Bank			2018.12.27				2019.02.01								5,606				USD 5,000								1,121.15
Standard Chartered			2018.12.28				2019.02.07								5,589				USD 5,000								1,117.80
KEB Hana Bank			2018.12.28				2019.02.07								5,584				USD 5,000								1,116.70
Mizuho Bank			2018.12.28				2019.02.07								11,172				USD 10,000								1,117.15
Societe Generale			2018.11.29				2019.01.04								11,206				USD 10,000								1,120.60
ING Bank			2018.12.20				2019.01.15								11,279				USD 10,000								1,127.89
ING Bank			2018.12.26				2019.01.23								11,248				USD 10,000								1,124.77
Nova Scotia			2018.12.07				2019.01.10								14,518				USD 13,000								1,116.80
Mizuho Bank			2018.12.06				2019.01.04								11,167				USD 10,000								1,116.67
Credit Agricole			2018.12.27				2019.01.23								11,208				USD 10,000								1,120.75
Korea Development Bank			2018.12.13				2019.01.10								4,490				USD 4,000								1,122.60
Korea Development Bank			2018.12.24				2019.01.10								13,497				USD 12,000								1,124.74
Korea Development Bank			2018.12.21				2019.01.15								10,103				USD 9,000								1,122.50
Korea Development Bank			2018.12.27				2019.01.23								11,207				USD 10,000								1,120.68
Korea Development Bank			2018.12.28				2019.01.23								13,412				USD 12,000								1,117.64
Societe Generale			2018.12.19				2019.01.21								7,853				USD 7,000								1,121.85
Societe Generale			2018.12.21				2019.01.28								8,974				USD 8,000								1,121.75
MUFG			2018.12.19				2019.01.21								6,730				USD 6,000								1,121.70
MUFG			2018.12.28				2019.02.07								8,929				USD 8,000								1,116.15
Nova Scotia			2018.12.19				2019.01.22								4,486				USD 4,000								1,121.50
Nova Scotia			2018.12.21				2019.01.28								8,976				USD 8,000								1,121.95
Nova Scotia			2018.12.27				2019.01.31								7,832				USD 7,000								1,118.90
Nonghyup Bank			2018.12.28				2019.02.07								10,041				USD 9,000								1,115.70
BNP Paribas			2018.12.28				2019.02.07								8,930				USD 8,000								1,116.30
CCB			2018.12.28				2019.02.07								7,812				USD 7,000								1,116.05
Credit Agricole			2018.12.28				2019.02.07			￦					7,812				USD 7,000			￦					1,115.95
KEB Hana Bank			2018.12.05				2019.01.07								16,697				USD 15,000								1,113.15
KEB Hana Bank			2018.12.07				2019.01.07								15,672				USD 14,000								1,119.43
Busan Bank			2018.12.28				2019.01.07								6,477				USD 5,800								1,116.70
Nonghyup Bank			2018.12.12				2019.01.07								3,380				USD 3,000								1,126.60
KEB Hana Bank			2018.12.13				2019.01.15								7,849				USD 7,000								1,121.25
Shinhan Bank			2018.12.20				2019.01.22								29,320				USD 26,000								1,127.68
Nonghyup Bank			2018.12.28				2019.02.15								53,666				USD 48,000								1,118.05
Credit Agricole			2018.11.02				2019.02.07								3,039				USD 2,729								1,113.60
Credit Agricole			2018.11.05				2019.02.07								5,564				USD 5,000								1,112.70
Nova Scotia			2018.11.07				2019.02.13								5,567				USD 5,000								1,113.40
Nova Scotia			2018.11.07				2019.02.13								4,458				USD 4,000								1,114.40
Societe Generale			2018.11.29				2019.03.04								5,568				USD 5,000								1,113.50
Societe Generale			2018.11.29				2019.03.04								3,674				USD 3,297								1,114.50
Credit Agricole			2018.12.03				2019.03.05								256				USD 231								1,109.10
Nova Scotia			2018.12.04				2019.03.06								5,522				USD 5,000								1,104.30
Nova Scotia			2018.12.04				2019.03.06								5,527				USD 5,000								1,105.30
Nova Scotia			2018.12.20				2019.03.26								5,589				USD 5,000								1,117.80
Nova Scotia			2018.12.20				2019.03.26								1,751				USD 1,565								1,118.80
Nova Scotia			2018.12.28				2019.04.02								5,565				USD 5,000								1,113.00
Nova Scotia			2018.12.28				2019.04.02								5,569				USD 5,000								1,113.80
Nova Scotia			2018.12.28				2019.04.02								5,576				USD 5,000								1,115.20
Nova Scotia			2018.12.28				2019.04.03								5,553				USD 5,000								1,110.60
Nova Scotia			2018.12.28				2019.04.03								5,558				USD 5,000								1,111.60
Nova Scotia			2018.12.28				2019.04.03								5,563				USD 5,000								1,112.60

(3) Currency swap contracts which are not designated as hedge instruments as of December 31, 2018 are as follows:

Counterparty		Contract year								Contract amount								Contract interest rate												Contract exchange rate (in won)
										Pay				Receive				Pay				Receive
		In millions of won and thousands of foreign currencies except contract exchange rate information
Credit Suisse			2014~2019			￦					118,632				CHF 100,000				2.98	%			1.50	%		￦					1,186.32
Standard Chartered			2014~2019								114,903				CHF 100,000				4.00	%			1.50	%							1,149.03
Standard Chartered			2014~2029								102,470				USD 100,000				3.14	%			3.57	%							1,024.70
Societe Generale			2014~2024								105,017				USD 100,000				4.92	%			5.13	%							1,050.17
KEB Hana Bank			2015~2024								107,970				USD 100,000				4.75	%			5.13	%							1,079.70
Credit Agricole			2015~2024								94,219				USD 86,920				4.85	%			5.13	%							1,083.97
Citibank			2012~2022								112,930				USD 100,000				2.79	%			3.00	%							1,129.30
JP Morgan			2012~2022								112,930				USD 100,000				2.79	%			3.00	%							1,129.30
Bank of America			2012~2022								112,930				USD 100,000				2.79	%			3.00	%							1,129.30
Shinhan Bank			2016~2022								112,930				USD 100,000				2.79	%			3.00	%							1,129.30
HSBC			2012~2022								111,770				USD 100,000				2.89	%			3.00	%							1,117.70
KEB Hana Bank			2012~2022								111,770				USD 100,000				2.87	%			3.00	%							1,117.70
Standard Chartered			2012~2022								111,770				USD 100,000				2.89	%			3.00	%							1,117.70
Deutsche Bank			2012~2022								55,885				USD 50,000				2.79	%			3.00	%							1,117.70
HSBC			2014~2019								105,260				USD 100,000				2.48	%			2.38	%							1,052.60
Standard Chartered			2014~2019			￦					105,260				USD 100,000				2.48	%			2.38	%		￦					1,052.60
Korea Development Bank			2016~2019								105,260				USD 100,000				2.48	%			2.38	%							1,052.60
Nomura			2015~2025								111,190				USD 100,000				2.60	%			3.25	%							1,111.90
Korea Development Bank			2015~2025								111,190				USD 100,000				2.62	%			3.25	%							1,111.90
Woori Bank			2015~2025								55,595				USD 50,000				2.62	%			3.25	%							1,111.90
KEB Hana Bank			2015~2025								55,595				USD 50,000				2.62	%			3.25	%							1,111.90
Woori Bank			2017~2027								111,610				USD 100,000				2.25	%			3.13	%							1,116.10
Korea Development Bank			2017~2027								111,610				USD 100,000				2.31	%			3.13	%							1,116.10
KEB Hana Bank			2017~2027								111,610				USD 100,000				2.31	%			3.13	%							1,116.10
Korea Development Bank			2018~2028								108,600				HKD 800,000				2.69	%			3.35	%							135.75
Shinhan Bank			2018~2028								115,387				HKD 850,000				2.66	%			3.35	%							135.75
Korea Development Bank			2018~2023								170,280				USD 150,000				2.15	%			3.75	%							1,135.20
Woori Bank			2018~2023								170,280				USD 150,000				2.18	%			3.75	%							1,135.20
KEB Hana Bank			2018~2023								113,520				USD 100,000				2.17	%			3.75	%							1,135.20
Shinhan Bank			2018~2023								227,040				USD 200,000				2.17	%			3.75	%							1,135.20

(4) Currency swap contracts which are designated as hedge instruments as of December 31, 2018 are as follows:

Counterparty		Contract year								Contract amount								Contract interest rate								Contract exchange rate (in won)
										Pay				Receive				Pay		Receive
		In millions of won and thousands of foreign currencies except contract exchange rate information
HSBC			2014~2020			￦					99,901				AUD 100,000			3.52%		5.75%		￦					999.01
HSBC			2014~2020								100,482				AUD 100,000			3.48%		5.75%							1,004.82
Standard Chartered			2013~2020								USD 117,250				AUD 125,000			3M Libor+1.25%		5.75%							0.94
Standard Chartered			2014~2020			￦					126,032				USD 117,250			3.55%		3M Libor+1.25%							1,074.90
Korea Development Bank			2017~2020								114,580				USD 100,000			1.75%		2.38%							1,145.80
KEB Hana Bank			2017~2020								114,580				USD 100,000			1.75%		2.38%							1,145.80
Export-import bank of Korea			2017~2020								114,580				USD 100,000			1.75%		2.38%							1,145.80
JP Morgan			2014~2019								107,190				USD 100,000			3M Libor+3.25%		2.75%							1,071.90
Morgan Stanley			2014~2019								107,190				USD 100,000			3M Libor+3.25%		2.75%							1,071.90
Deutsche Bank			2014~2019								107,190				USD 100,000			3M Libor+3.25%		2.75%							1,071.90
Korea Development Bank			2016~2021								121,000				USD 100,000			2.15%		2.50%							1,210.00
Morgan Stanley			2016~2021								121,000				USD 100,000			3M Libor+2.10%		2.50%							1,210.00
BNP Paribas			2016~2021								121,000				USD 100,000			3M Libor+2.10%		2.50%							1,210.00
Nomura			2017~2037								52,457				EUR 40,000			2.60%		1.70%							1,311.42
Nomura			2017~2037								59,423				SEK 450,000			2.62%		2.36%							132.05
Credit Agricole			2013~2019								118,343				CHF 100,000			3.47%		1.63%							1,183.43
Morgan Stanley			2013~2019								59,172				CHF 50,000			3.40%		1.63%							1,183.43
Nomura			2013~2019								59,172				CHF 50,000			3.47%		1.63%							1,183.43
Standard Chartered			2014~2019								104,490				USD 100,000			2.77%		2.63%							1,044.90
Credit Agricole			2014~2019								104,490				USD 100,000			2.77%		2.63%							1,044.90
Morgan Stanley			2014~2019								104,490				USD 100,000			2.70%		2.63%							1,044.90
Korea Development Bank			2018~2023								320,880				USD 300,000			2.03%		3.75%							1,069.60
KEB Hana Bank			2018~2021								212,960				USD 200,000			2.10%		3.00%							1,064.80
Korea Development Bank			2018~2021			￦					212,960				USD 200,000			2.10%		3.00%		￦					1,064.80
Credit Agricole			2014~2020								110,680				USD 100,000			2.29%		2.50%							1,106.80
Societe Generale			2014~2020								55,340				USD 50,000			2.16%		2.50%							1,106.80
KEB Hana Bank			2014~2020								55,340				USD 50,000			2.16%		2.50%							1,106.80
KEB Hana Bank			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
Standard Chartered			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
HSBC			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
Nomura			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
BNP Paribas			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
HSBC			2014~2020								55,340				USD 50,000			2.21%		2.50%							1,106.80
KEB Hana Bank			2017~2022								226,600				USD 200,000			1.94%		2.63%							1,133.00
Korea Development Bank			2017~2022								113,300				USD 100,000			1.94%		2.63%							1,133.00
Nomura			2017~2022								113,300				USD 100,000			1.95%		2.63%							1,133.00
Woori Bank			2017~2022								56,650				USD 50,000			1.95%		2.63%							1,133.00
Kookmin Bank			2017~2022								56,650				USD 50,000			1.95%		2.63%							1,133.00
Korea Development Bank			2018~2023								169,335				USD 150,000			2.26%		3.88%							1,128.90
Woori Bank			2018~2023								169,335				USD 150,000			2.26%		3.88%							1,128.90
Credit Agricole			2018~2023								112,890				USD 100,000			2.26%		3.88%							1,128.90
KEB Hana Bank			2018~2023								56,445				USD 50,000			2.26%		3.88%							1,128.90
Kookmin Bank			2018~2023								56,445				USD 50,000			2.26%		3.88%							1,128.90

(5) Interest rate swap contracts which are not designated as hedge instruments as of December 31, 2018 are as follows:

Counterparty

Contract year

Contract amount

Contract interest rate per annum

Pay

Receive

In millions of won and thousands of USD

KEB Hana Bank

2017~2022

￦

100,000

2.01%

3M CD+0.24%

KEB Hana Bank

2017~2022

100,000

2.06%

3M CD+0.27%

Nomura(*1)

2017~2037

30,000

2.05%

3.08%

KEB Hana Bank

2017~2021

200,000

2.45%

3M CD+0.32%

Nomura(*2)

2018~2038

30,000

2.56%

3.75%

KEB Hana Bank

2018~2023

200,000

2.15%

3M CD+0.19%

KEB Hana Bank

2018~2023

200,000

2.17%

3M CD+0.19%

KEB Hana Bank

2018~2023

150,000

2.03%

3M CD+0.21%

Societe Generale

2017~2022

200,000

3M Libor+3.44%

3.77%

Export-import bank of Korea

2015~2031

USD 15,893

2.67%

6M USD Libor

ING Bank

2015~2031

USD 7,861

2.67%

6M USD Libor

BNP Paribas

2015~2031

USD 7,861

2.67%

6M USD Libor

(*1) 2.05% of the contract paying interest rate is applied for five years from the date of issuance, and 3M CD+0.10% is applied thereafter.

(*2) 2.56% of the contract paying interest rate is applied for five years from the date of issuance, and 3M CD+0.10% is applied thereafter.

(6) Interest rate swap contracts which are designated as hedge instruments as of December 31, 2018 are as follows:

Counterparty

Contract year

Contract amount

Contract interest rate per annum

Pay

Receive

In millions of won and thousands of USD

BNP Paribas

2009~2027

USD 92,120

4.16%

6M USD Libor

KFW

2009~2027

USD 92,120

4.16%

6M USD Libor

Credit Agricole

2018~2033

USD 92,686

3.98%~4.10%

6M USD Libor

SMBC

2018~2033

USD 121,205

4.05%~4.18%

6M USD Libor

Mizuho Bank

2016~2019

USD 36,890

1.56%

1.65%

SMBC

2016~2019

USD 36,890

1.56%

1.65%

Export-import bank of Korea

2016~2036

USD 2,564

3.00%

4.99%

(7) Gain and loss on valuation and transaction of derivatives for the years ended December 31, 2016, 2017 and 2018 are as follows and included in finance income and costs in the consolidated statements of comprehensive income (loss):

				Net income effects of valuation gain (loss)												Net income effects of transaction gain (loss)												Accumulated other comprehensive income (loss) (*)
				2016				2017				2018				2016				2017				2018				2016				2017				2018
				In millions of won
Currency forward		￦			15,993				(41,889	)			12,632				4,266				(28,223	)			23,991				—				—				—
Currency swap					253,035				(843,747	)			145,088				(68,266	)			(137,376	)			123,670				40,031				26,810				(12,516	)
Interest rate swap					8,517				6,909				(2,949	)			7,562				(3,362	)			(364	)			6,719				5,074				6,087
Other derivatives					10,523				4,060				(1,568	)			—				—				—				—				—				—
		￦			288,068				(874,667	)			153,203				(56,438	)			(168,961	)			147,297				46,750				31,884				(6,429	)

(*) For the year ended December 31, 2018, the net gain on valuation of derivatives applying cash flow hedge accounting of ￦211 million, net of tax, is included in other comprehensive income or loss.

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- References

No definition available.

+ Details

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- Definition

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-URI http://asc.fasb.org/topic&trid=2229140

+ Details

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