IBERSOL Annual Report and Consolidated Accounts 2017

Consolidated Financial Statements The ratings of the major credit institutions where Ibersol group has its deposits on December 31, 2017 and 2016 are presented as follows: Year 2017 Year 2016 Agency Deposits Rating Deposits Rating Standard & Poor´s 1.232.955 A- 243.424 A- Standard & Poor´s 1.680.986 BBB+ 6.026.676 BBB+ Standard & Poor´s 7.031.172 BBB- - BBB- Standard & Poor´s - BB+ 10.979.707 BB+ Standard & Poor´s 5.302.808 BB- 3.909.284 BB- Standard & Poor´s - B 756.940 B Moody's 4.484.806 Baa2 3.880.101 Baa2 Moody's 5.342.953 Baa3 1.968.656 Baa3 Moody's 1.117.848 Ba3 - Ba3 Moody's 202.286 B2 - B2 Moody's - Caa1 932.315 Caa1 Moody's 1.444.112 Caa2 - Caa2 not available (Angola) 4.041.568 n/a 8.334.192 n/a Deposits in Angola are distributed by three of the largest commercial banks in Angola - BFA, BCGA and BAI - but which do not have a rating. The quality of financial assets not due or impaired is detailed in Note 15. c) Liquidity risk Liquidity risk management implies maintaining a sufficient amount of cash and bank depos- its, the feasibility of consolidating the floating debt through a suitable amount of credit facilities and the capacity to liquidate market positions. Treasury needs are managed based on the annual plan that is reviewed every quarter and adjusted daily. Related with the dy- namics of the underlying business operations, the group’s treasury strives to maintain the floating debt flexible by maintaining credit lines available. The Group considers that the short-term bank loans are due on the renewal date and that the commercial paper programmes matured on the dates of denunciation. At the end of the year, current liabilities reached 119 million euros, compared with 77 million euros in current assets. This disequilibrium is, on one hand, a financial characteristic of this business and, on the other hand, due to the use of commercial paper programmes in witch the Group considers the maturity date as the renewal date, regardless of its initial stated periods. In order to ensure liquidity of the short term debt it is expected in the year 2018 the renewal of the commercial paper programmes (24.250.000 euros). However, the ex- pected operating cash flows and, if necessary, contracted credit lines, on the amounts of which have not yet been used, are sufficient to settle current liabilities. 228