Financing Policy and Credit Ratings

Our financing policy aims to ensure our solvency at all times, limiting the risks associated with financing and optimizing our cost of capital. We preferably meet our external financing needs on the international capital markets.

BASF strives for a single A rating, which ensures unrestricted access to financial and capital markets. Our financing measures are aligned with our operational business planning as well as the company’s strategic direction and also ensure the financial flexibility to take advantage of strategic options.

Maturities of financial indebtedness

Million €

BASF enjoys good credit ratings, especially compared with competitors in the chemical industry. Standard & Poor’s maintained its rating of A–/A–2/outlook stable on December 2, 2024. Moody’s rating of A3/P–2/outlook stable was most recently confirmed on November 18, 2024. Fitch confirmed its rating of A/F1/outlook stable on November 1, 2024.

We have solid financing, both for ongoing business and for investment projects initiated or planned. Corporate bonds form the basis of our medium to long-term debt financing. These are issued in euros and other currencies with different maturities as part of our €20 billion debt issuance program. The goal is to create a balanced maturity profile, diversify our financing and optimize our debt capital financing conditions.

For short-term financing, we use BASF SE’s global commercial paper program, which has an issuing volume of up to $12.5 billion. As of December 31, 2024, no commercial paper was outstanding under this program. A firmly committed, syndicated credit line of €6 billion with a term until 2029 covers the repayment of outstanding commercial paper. It can also be used for general company purposes. In 2024, the term of this credit line was extended until 2029, and the credit line was not used at any point in 2024. In 2023, BASF Integrated Site (Guangdong) Co. Ltd., China, signed a syndicated bank term loan facility totaling 40 billion Chinese renminbi with a maturity of 15 years for the construction of the Verbund site in Zhanjiang. Of this amount, 17 billion Chinese renminbi (€2.1 billion) was utilized as of December 31, 2024. Our external financing is largely independent of short-term fluctuations in the credit markets.

BASF Group’s most important financial contracts contain no side agreements with regard to specific financial ratios (financial covenants) or compliance with a specific rating (rating trigger). To minimize risks and leverage internal optimization potential within the Group, we bundle the financing, financial investments and foreign currency hedging of BASF SE’s subsidiaries within the BASF Group where possible. Foreign currency risks are primarily hedged centrally using derivative financial instruments in the market.

Our interest risk management generally pursues the goal of reducing interest expenses for the BASF Group and limiting interest risks. Interest rate hedging transactions are therefore conducted with banks in order to turn selected liabilities to the capital market from fixed to variable interest rates or vice versa.