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Financial instruments | 12 Months Ended
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Dec. 31, 2019
Financial instruments [Abstract] |
Financial instruments | Note 8 – Financial instruments Categories of financial instruments
(Dollars in thousands) |  | Carrying amount |
Financial assets |  | 2019 |  |  | 2018 |
Cash and cash equivalents (1)(3) |  |  | 67,356 |  |  |  | 94,944 |
Accounts receivable and accrued revenues (1) |  |  | 107,848 |  |  |  | 60,196 |
Total |  | $ | 175,204 |  |  | $ | 155,140 |
Financial liabilities |  |  |  |  |  |  |  |
Accounts payables and accrued expenses (1) |  | $ | 23,998 |  |  | $ | 28,634 |
Derivative financial liabilities, current (2) |  |  | 4,320 |  |  |  | 1,250 |
Current portion long-term debt (1) |  |  | 100,385 |  |  |  | 93,815 |
Long-term debt (1) |  |  | 750,586 |  |  |  | 873,460 |
Derivative financial liabilities, non-current (2) |  |  | 11,279 |  |  |  | 4,486 |
Total financial liabilities |  | $ | 890,569 |  |  | $ | 1,001,645 |
(1) | Amortized cost.
(2) | Fair value through profit or loss.
(3) | Cash and cash equivalents include $221 thousand in restricted cash in 2019 and $638 thousand in 2018, including employee withholding tax.
Fair value of non-derivative financial instruments It is assumed that fair value of non-derivative financial instruments is equal to the nominal amount for all financial assets and liabilities. With regards to trade receivables, the credit risk is not viewed as significant. With regards to the credit facilities, these are floating rate with terms and conditions considered to be according to market terms and no material change in credit risk; consequently, it is assumed that carrying value has no material deviation from fair value. Measurement of fair value It is only derivatives that are classified within a fair value measurement category and recognized at fair value in the statement of financial position. Fair value measurement is based on Level 2 in the fair value hierarchy as defined in IFRS 13 Fair Value Measurement. Such measurement is based on techniques for which all inputs that have a significant effect on the recorded fair value are observable. Future cash flows are estimated based on forward interest rates (from observable yield curves at the end of the reporting period) and contract interest rates, discounted at a rate that reflects the credit risk of various counterparties. Derivatives - interest rate swaps
|  |  | Notional amount |  |  | Fair value |
(Dollars in thousands) | Expires |  | 2019 |  |  | 2018 |  |  | 2019 |  |  | 2018 |
Swap pays 2.987%, receive floating | Apr. 20, 2023 |  | $ | 44,400 |  |  |  | 46,800 |  |  |  | 1,748 |  |  |  | 699 |
Swap pays 3.012%, receive floating | Apr. 20, 2023 |  | $ | 44,400 |  |  |  | 46,800 |  |  |  | 1,780 |  |  |  | 743 |
Swap pays 3.019%, receive floating | Sept. 29, 2023 |  | $ | 33,310 |  |  |  | 35,877 |  |  |  | 1,425 |  |  |  | 580 |
Swap pays 3.019%, receive floating | Sept. 29, 2023 |  | $ | 32,396 |  |  |  | 34,963 |  |  |  | 1,380 |  |  |  | 563 |
Swap pays 2.8665%, receive floating | Sept. 29, 2023 |  | $ | 48,830 |  |  |  | 51,400 |  |  |  | 1,976 |  |  |  | 606 |
Swap pays 2.8785%, receive floating | Jun. 30, 2023 |  | $ | 43,240 |  |  |  | 45,807 |  |  |  | 1,681 |  |  |  | 503 |
Swap pays 2.885%, receive floating | Sept. 29, 2023 |  | $ | 48,188 |  |  |  | 50,115 |  |  |  | 1,961 |  |  |  | 653 |
Swap pays 2.897%, receive floating | Sept. 30, 2023 |  | $ | 43,419 |  |  |  | 45,986 |  |  |  | 1,789 |  |  |  | 597 |
Swap pays 3.020%, receive floating | Sept. 29, 2023 |  | $ | 41,734 |  |  |  | 44,301 |  |  |  | 1,859 |  |  |  | 793 |
Total carrying amount |  |  | $ | 379,916 |  |  |  | 402,049 |  |  |  | 15,600 |  |  |  | 5,736 |
Interest-bearing debt
|  |  |  |  | Remaining |  |  | Carrying amount |
(Dollars in thousands) |  | Interest |  |  | notional |  |  | 2019 |  |  | 2018 |
Credit Agricole Credit Facility |  | LIBOR + 2.19 % |  |  |  | 56,120 |  |  |  | 55,719 |  |  |  | 62,166 |
Danish Ship Finance Credit Facility |  | LIBOR + 2.25 % |  |  |  | 39,000 |  |  |  | 38,929 |  |  |  | 41,437 |
Nordea BW VLCC Acquisition Credit Facility |  | LIBOR + 2.40 % |  |  |  | 209,628 |  |  |  | 207,175 |  |  |  | 254,870 |
ABN Amro Credit Facility |  | LIBOR + 2.40 % |  |  |  | 436,261 |  |  |  | 432,581 |  |  |  | 464,826 |
ABN Amro Revolving Credit Facility |  | LIBOR + 2.50 % |  |  |  |  |  |  |  |  |  |  |  |  |
Convertible Senior Notes due 2019 |  |  | 4.50 | % |  |  | - |  |  |  | - |  |  |  | 32,009 |
Convertible Senior Notes due 2021 |  |  | 4.50 | % |  |  | 125,000 |  |  |  | 116,568 |  |  |  | 111,968 |
Total carrying amount |  |  |  |  |  |  | 866,009 |  |  |  | 850,972 |  |  |  | 967,275 |
Interest on all our credit facilities is payable quarterly in arrears except the Danish Ship Finance Credit Facility and the Convertible Notes which have interest payable semi-annually in arrears. The credit facilities are principally secured by the first-priority mortgages on the vessels financed by the credit facility, assignments of earnings, pledge of shares in the borrower, insurance and the borrowers’ rights under charters for the vessels, if any, as well as a pledge of the borrowers’ bank account balances. Reconciliation of liabilities arising from financing activities The table below details changes in liabilities arising from financing activities, including both cash and non-cash changes. Liabilities arising from financing activities are those for which cash flows were, or future cash flows will be, classified in the Company’s consolidated statement of cash flows as cash flows from financing activities.
|  |  |  |  |  |  |  |  |  |  | Non-cash changes |  |  |  |
|  | As of January 1, 2019 (1) |  |  | Financing cash flows (2) |  |  | Fair value changes (3) |  |  | Amortization |  |  | Equity component of convertible notes |  |  | Other changes (4) |  |  | As of December 31, 2019 |
Bank loans |  |  | 823,299 |  |  |  | (91,440 | ) |  |  |  |  |  |  | 2,545 |  |  |  |  |  |  |  |  |  | 734,404 |
Convertible Senior Notes due 2019 |  |  | 32,009 |  |  |  | (6,426 | ) |  |  |  |  |  |  | 851 |  |  |  | (26,434 | ) |  |  |  |  |  | - |
Convertible Senior Notes due 2021 |  |  | 111,968 |  |  |  | (7 | ) |  |  |  |  |  |  | 4,607 |  |  |  |  |  |  |  |  |  |  | 116,568 |
Office leases |  |  | 1,484 |  |  |  | (370 | ) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1,732 |  |  |  | 2,846 |
Total (5) |  |  | 968,759 |  |  |  | (98,243 | ) |  |  | - |  |  |  | 8,003 |  |  |  | (26,434 | ) |  |  | 1,732 |  |  |  | 853,817 |
|  |  |  |  |  |  |  |  |  |  | Non-cash changes |  |  |  |
|  | As of January 1, 2018 |  |  | Financing cash flows (2) |  |  | Fair value changes (3) |  |  | Amortization |  |  | Equity component of convertible notes |  |  | Other changes (4) |  |  | As of December 31, 2018 |
Bank loans |  |  | 687,942 |  |  |  | 129,400 |  |  |  |  |  |  | 6,826 |  |  |  |  |  |  | (869 | ) |  |  | 823,299 |
Convertible Senior Notes due 2019 |  |  | 98,262 |  |  |  |  |  |  |  | (74,644 | ) |  |  | 3,188 |  |  |  | 1,613 |  |  |  | 3,589 |  |  |  | 32,009 |
Convertible Senior Notes due 2021 |  |  |  |  |  |  | 38,945 |  |  |  | 74,644 |  |  |  | 1,545 |  |  |  | (3,165 | ) |  |  |  |  |  |  | 111,968 |
Total (5) |  |  | 786,204 |  |  |  | 168,345 |  |  |  | - |  |  |  | 11,559 |  |  |  | (1,553 | ) |  |  | 2,720 |  |  |  | 967,275 |
(1) | The opening balance as of January 1, 2019, includes the initial recognition of a lease liability of $1.5 million resulting from the adoption of IFRS 16 Leases.
(2) | The cash flows from bank loans make up the net amount of issuance of long-term debt and repayment of long-term debt in the statement of cash flows. In 2018 the cash flows from the transaction related to the exchange of convertible senior notes due 2019 of $38.9 million consisted of $41.6 million cash received upon issue, less transaction costs of $2.7 million.
(3) | Fair value changes reflects the loss arising from the exchange of the convertible senior notes due 2019 to convertible senior notes due 2021 below market fair value.
(4) | Other changes for the year 2019 represents new, modified office leases and foreign exchange effects during the year related to IFRS 16 Leases. Other changes for the year 2018 represents the (gain)/loss on extinguishment of debt, including previously capitalized fees.
(5) | The reconciliation does not include interest rate swaps, which are described in note 8.

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