24 – Liabilities

Other bonds

Other bonds consist primarily of industrial revenue and pollution control bonds issued by the BASF Corporation group that were used to finance investments in the United States. Both the weighted average interest rate of these bonds and their weighted effective interest rate amounted to 2.9% in 2019 and 3.0% in 2018. The average weighted residual term amounted to 158 months as of December 31, 2019 (December 31, 2018: 168 months).

Liabilities to credit institutions

Liabilities to credit institutions rose from €2,397 million as of December 31, 2018 to €3,240 million as of December 31, 2019. The weighted average interest rate on loans amounted to 3.8% in 2019 compared with 5.6% in 2018.

Unused credit lines

BASF SE had committed and unused credit lines with variable interest rates amounting to €6,000 million both as of December 31, 2019 and as of December 31, 2018. In addition, BASF SE had an unused credit line of €380 million (2018: €400 million) for the financing of specific research and development activities as of December 31, 2019.

Other liabilities

The increase in liabilities from leases was mainly attributable to the initial application of IFRS 16. Liabilities from precious metal trading positions rose due to higher market prices for precious metals. Contract liabilities include mainly customer payments entitling them to access to licenses over an agreed period of time. The majority of existing contracts have terms of up to seven years. Of the contract liabilities reported as of December 31, 2019, €53 million are expected to be recognized as revenue in 2020.

Liabilities to credit institutions were secured primarily with registered land charges. Other liabilities include collateral for derivative instruments with negative fair values. As in the previous year, there were no secured contingent liabilities in 2019.