VOLKSWAGEN INTERNATIONAL FINANCE N.V.
Annual report
for the year ended 31 December 2024
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Table of Contents
Report of the Supervisory Board 3
Report of the Management Board 4
Financial Statements 9
Statement of financial position 10
Statement of income and comprehensive income 11
Statement of changes in equity 12
Statement of cash flows 13
Notes to the annual financial statements 14
Responsibility Statement 68
Signing of the Annual Report 69
Other information 70
Auditor’s report 71
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Report of the Supervisory Board
The balance sheet total and the operating result for the financial year 2024 of Volkswagen
International Finance N.V. (‘VIF’ or ‘the Company’) are in line with the expected development of
the Company. The solvency and liquidity of the Company remained strong and robust. The issuance
activities of VIF in the capital markets were coordinated with the parent company, Volkswagen AG.
In 2024, the credit rating agencies maintained their rating short- and long term assessments for
Volkswagen AG. Moody’s maintained the rating at P-2 / A3 (short term / long term) but updated
the outlook assessment from stable to negative. Standard & Poor’s maintained the rating at A-2 /
BBB+ (short term / long term) and maintained the assessment of stable outlook. Fitch’s rating was
confirmed on a solicited basis for the first time in January 2024, being at F1 for the short term
assessment and at A- for the long term assessment, with a stable outlook affirmed.
Monitoring and advisory activities of the Supervisory Board
In our capacity as the Supervisory Board, we provided the Management Board with in-depth advice
on matters relating to management and further development of the Company and monitored the
Management Board running of the business, both continuously and thoroughly. In 2024 the
Supervisory Board convened for one annual meeting. All board members attended the supervisory
board meeting. During the meeting, the financial results of the prior year were discussed, as well as
a forecast of the financial results for the current year was presented. Risk management topics were
addressed and material projects for the year were discussed.
Description of the Audit Committee
The Supervisory Board does not divide the responsibilities into sub-committees, but takes charge of
all tasks that such committees traditionally would fulfil.
Composition of the Supervisory Board
The Supervisory Board consists of three members: Björn Bätge (Wolfsburg, Germany) was
appointed member and chairman on 01 October 2021. Bjoern Reinecke (Braunschweig, Germany)
was appointed member on 01 November 2018. Dr. Marcus Hellmann (Braunschweig, Germany)
was appointed member on 21 October 2021.The members of the Supervisory Board did not receive
any remuneration in the relevant reporting periods.
Examination of financial statements
During the annual General Meeting of VIF on 18 June 2024 EY Accountants B.V, Rotterdam was
elected as independent auditor for the financial year 2024. The independent auditors audited the
annual financial statements of VIF and issued an unqualified audit opinion. Following a thorough
examination and discussion of the proposed financial statements based on the audit report, the
Supervisory Board authorized the issuance of the 2024 Financial Statements by the management
board on 10 March 2025.
Amsterdam, 10 March 2024
Björn Bätge
Chairman of the Supervisory Board
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Report of the Management Board
Business Strategy and Objectives
The Company was founded in 1977 and is one of the funding vehicles of the Company’s ultimate
parent, Volkswagen AG (‘VWAG’). VIF raises funds by issuing bonds and commercial paper in
the international capital markets and lends the proceeds to Volkswagen Group companies and joint
ventures. VIF provides the capital market funding as a service within Volkswagen Group thereby
achieving an adequate return commensurate with the efforts and associated risks. VIF has 8
employees and under service agreements also performing tasks for three sister companies
(Volkswagen Financial Services N.V., Volkswagen Finance Europe B.V. and Volkswagen Finance
Overseas B.V.). Volkswagen Financial Services N.V. with its 6 employees performs similarly tasks
for VIF.
At Volkswagen International Finance N.V., our mission is to provide robust financial solutions and
services that support the strategic growth and operations of the Volkswagen Group. We aim to
facilitate the financing of Volkswagen Group companies, ensuring their continued success across
the automotive and financial services sectors. Through financial expertise, we contribute to the
overall value chain through to the customer.
Composition of the Management Board
The Management Board consists of one members: Christopher Ryan Norrod (Amsterdam, The
Netherlands) and was appointed member on 01 August 2021.
Funding
Basis for the issuing activities of the Company are the regularly updated Debt Issuance Programme
(DIP) of € 30 billion that adheres to the European Prospectus Directive, as well as the € 15 billion
Multicurrency Commercial Paper Programme (CP Programme). Since 2023, VIF is also issuing
onshore bonds in China, via the Debt Financing Instruments (DFI) program, regulated by the
National Association of Financial Market Institutional Investors (NAFMII). VIF is issuing also
under stand-alone documentation. All issues are fully guaranteed by VWAG.
Therefore, the VIF credit rating by Moody’s, Standard & Poor’s, and Fitch is derived from the
VWAG credit rating. According to Moody’s, VWAG’s rating is set to P-2 (short-term) and A3
(long-term) with a negative outlook. Standard & Poor’s assessed VWAG’s creditworthiness as A-2
(short-term) and BBB+ (long-term) with a stable outlook. Fitch’s rating was confirmed on a solicited
basis for the first time in January 2024, being at F1 for the short term assessment and at A- for the
long term assessment, with a stable outlook affirmed. The solvency and liquidity of the Company
remained strong and robust.
In 2024 VIF continued with funding from the Capital Markets issuing bonds amounting to an
equivalent of € 1,2 billion (2023: € 3,8 billion). VIF redeemed in 2024 multiple bond issues with an
equivalent of € 3,1 billion (2023: € 3,4 billion). Furthermore € 0,6 billion were issued under the
aforementioned CP Programme (no issuance in 2023). The Company did not take on any borrowings
from VW Group companies in 2024 and 2023.
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Financial Results
VIF slightly decreased its lending assets from € 34,5 billion in 2023 to € 34 billion in 2024. All
outstanding loans have been fully performing.
VIF realized a profit of € 17,1 million after tax in 2024 (2023: € 105,1 million). The Company
generates income mainly from the Group financing business. The net interest income increased from
€ 63,1 million to € 66,9 million.
Net cash from operating activities amounted to € 699,2 million (2023: € -46,7 million).
In 2024, VIF did not distribute any dividends.
All issuances under the DIP, DFI and CP-programmes are guaranteed by VWAG, mitigating the
risk to external investors.
Research and Development Activities
The company did not engage in any research and development (R&D) activities during the reporting
period. This is because the business model does not require significant investment in R&D for
product development or technological advancements.
As a result, there are no associated costs or assets related to R&D to report in the financial
statements.
Risks
The Board of Management is responsible for the internal control, the management of risks within
the company and for the assessment of the effectiveness of the control systems.
VIF is exposed to business and financial risks. Business risks comprise inter alia legal, operational,
personnel, reputational and compliance risks. VIF is adhering to the Governance, Risk and
Compliance Guidelines of Volkswagen AG in managing the aforementioned risks.
The main financial risks of VIF are liquidity risk, credit risk, currency risk and interest rate risk.
Liquidity risk is defined as the risk of not being able to meet own payment obligations in full or
when due. Credit risk is the risk that a counterparty will not meet its payment obligations under a
financial instrument or customer contract, leading to a financial loss. Currency risk refers to the
potential loss in open currency positions arising from adverse changes in exchange rates. Interest
rate risk occurs because of fixed and floating interest rate mismatches between asset and liability
items on the balance sheet.
The Supervisory Board has established narrow risk limits to restrict these risks and achieve a low
risk exposure.
Risk policies
Liquidity risk is contained by extending loan amounts sourced from bond or CP-issuances to VW-
Group companies at identical tenors as the funded amounts. VW Group borrowers repay their loans
on the same due date when VIF’s own payment obligations to the capital markets become due.
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The Company is exposed to credit risk from loans extended to related parties and through entering
into derivative contracts with external banks. Credit risk is addressed by monitoring the financial
stability of the Group borrowers and by only executing derivatives with counterparties that are
highly rated and have entered into an ISDA Master Agreement in which a set-off is agreed to in the
event of default by either counterparty. A fair value and impairment trigger assessment is performed
for Group companies at least once a year or in case of need. Banks are monitored centrally at
Volkswagen AG based on rating and financial analyses. Financial transactions are only conducted
with approved banks.
Currency risk is limited by matching funding and lending currency amounts. In case funding and
lending currency do not match, derivatives are used to achieve closed positions.
Interest rate risk is contained by matching the fixed and floating interest rate terms of the funding
and lending amounts. Mismatches are closed using interest rate derivatives.
For remaining mismatches the Supervisory Board has defined narrow limits. VIF uses adequate
tools to assess and to monitor risks. On a monthly basis, a detailed mismatch report, containing all
relevant risks, is presented to the management and the Supervisory Board. In 2024, limits were not
exceeded.
Diesel issue
In September 2015, the California Air Resources Board (CARB) and the US Environmental
Protection Agency (EPA) publicly announced that irregularities in relation to nitrogen oxide
emissions had been discovered in emission tests on certain vehicles with diesel engines, resulting in
violations of US environmental laws.
Depending on the different emissions regulations in the various countries, Volkswagen has rectified
and is rectifying the diesel engine software, applied technical measures, compensated owners for
reduced residual values or took back affected cars. The financial impact of this incident to the Group
is discussed in the quarterly and annual reports of Volkswagen AG.
Adherence to tax and regulatory requirements
The Company had its tax returns up to and including 2021 reviewed by the Dutch Tax Authorities.
For the tax return 2022, the final assessment has not been received.
Due to its issuing activities in the capital markets and the listing at the Luxemburg Stock Exchange
the Company is complying with the regulatory requirements regarding the yearly submission of its
annual financial report to the Dutch Financial Market Authority (the “AFM”) and the approval
requirements for its prospectuses by the Commission de Surveillance du Secteur Financier of the
Grand Duchy of Luxembourg (the "CSSF").
In December 2021, the OECD issued model rules for a new global minimum tax framework. Several
jurisdictions announced the intention to bring these into effect. In December 2022 EU member states
agreed to a correspondent EU directive. The Minimum (top-up) tax legislation has been approved
on 19 December 2023 in the Netherlands. For more information regarding Pillar Two, please see
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the Accounting policy note 2(h) and Income tax note 26 in the Financial statements section of this
report, which specify the (expected) impact of Pillar Two.
Compliance & Integrity
Acting with Integrity, Compliance and honesty is an essential prerequisite for the success of the
Volkswagen Group. For this reason, compliance with national and international laws and
regulations, internal rules and guidelines and voluntary commitments is among VIF’s most
important principles. The focus of VIF’s compliance organization is on preventing corruption,
breaches of trust and money laundering and thereby reducing the risk of unlawful actions. The
Volkswagen Group’s Code of Conduct is established throughout the Group, and thus also within
VIF. It is the main tool for reinforcing awareness of good conduct, ethical principles and an integrity
culture among the employees and providing them assistance, as well as suitable contacts in case of
uncertainty. Next to the Volkswagen Group Code of Conduct, other Group policies and guidelines
on specific compliance issues have been implemented within VIF. Where laws and regulations have
been violated, the Volkswagen Group Whistleblower System is a suitable tool for taking appropriate
actions where misconduct is proven.
Corporate Governance
As per the corporate governance framework and in accordance with Explanatory Note BPP 5.1.5,
the company acknowledges that it does not currently have non-executive directors. In the absence
of non-executive directors, the supervisory and oversight functions typically carried out by non-
executive directors are instead performed by the supervisory board.
The company ensures that robust governance and supervision are maintained through independent
members of the board. The board continues to oversee the company’s strategic direction, risk
management, and compliance with applicable laws and regulations.
The company recognizes the importance of independent oversight and will review its governance
structure as part of its ongoing commitment to maintaining best practices in corporate governance.
Non-financial matters
VIF is not obliged to disclose a non-financial statement and refers to the combined, separate non-
financial report of Volkswagen AG for the fiscal year 2024, which will be available on the website
www.volkswagenag.com.
Expectations 2025
VIF will continue in 2025 its issuing activities in the capital markets. In line with the long-term
business strategy, the Volkswagen Group plans to develop new products and to improve its position
in existing markets. We expect that VWAG will keep VIF’s capital reserve on an adequate level.
As several Volkswagen Group companies worldwide are going to use the attractive European
funding opportunities, VIF foresees additional requests for refinancing which will be taken care of
with reinstated and increased capital market issuances under the DIP, DFI and CP-programmes.
For the upcoming period, the company does not anticipate any significant changes in staffing levels
or the organizational structure. The current workforce is expected to remain stable, with no major
additions, reductions, or reorganization of staff. Our focus will remain on maintaining operational
efficiency and supporting the ongoing development of our existing employees.
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We will continue to invest in employee development, well-being, and retention strategies to ensure
that our team is equipped to meet the company’s business objectives. Regular performance reviews
and training initiatives will remain in place to support the professional growth of our staff.
Based on this assumption, we expect a moderate increase in total business volume for VIF in 2025.
Taking into account the expected growth in business volume and the interest environment, the
development of net interest income should be at a stable growth. The financial statements have been
prepared under the going concern assumption.
In principle, one third of the Management Board should be female; however, currently there is only
one Managing Director on the Management Board of the Company. The Company will deal with
this recommendation of the social and economic council (SER) in the future.
Responsibility
The responsibility statement, confirming that the financial statements have been prepared in
accordance with applicable reporting standards and provide a true and fair view of the company’s
financial position, is included as a separate section in the annual report.
Amsterdam, 10 March 2025
Volkswagen International Finance N.V.
The Management Board
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Financial Statements
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Statement of financial position as at 31 December 2024
(in thousands of EUR)
Notes 31 December 2024 31 December 2023
ASSETS
Non-current assets
Property, equipment and right-of-use assets 1.164 345
Loans to related parties 7 28.552.902 30.805.970
Derivative financial instruments 8 20.097 26.208
Deferred tax assets 25 38.219 26.440
Total non-current assets 28.612.382 30.858.963
Curre nt as se ts
Loans to related parties 7 5.459.362 3.679.565
Derivative financial instruments 8 1.127 37.628
Trade and other receivables 1.655 -
Other current assets 94 211
Cash-pool receivables 10 101.345 736.930
Total current assets 5.563.583 4.454.334
TOTAL ASSETS 34.175.965 35.313.297
EQUITY AND LIABILITIES
Equity
Issued capital 11 103.035 103.035
Share premium 11 12.120 12.120
Retained earnings 484.468 467.335
Total equity 599.623 582.490
Non-current liabilities
Debts issued and other borrowed funds 12 28.800.562 31.028.452
Derivative financial instruments 8 16.514 18.222
Other liabilities 13 911 81
Deferred tax liabilities 25 - -
Total non-current liabilities 28.817.987 31.046.755
Curre nt liabilitie s
Trade and other payables 40 194
Debts issued and other borrowed funds 12 4.731.823 3.675.851
Derivative financial instruments 8 17.598 186
Other current liabilities 523 597
Current tax liabilities 8.218 7.025
Provisions 153 199
Total current liabilities 4.758.355 3.684.052
TOTAL EQUITY AND LIABILITIES 34.175.965 35.313.297
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Statement of income and comprehensive income
for the year ended 31 December 2024
(in thousands of EUR)
Notes
2024 2023
Interest revenue calculated using the effective interest method 17 1.320.849 1.212.713
Other interest and similar income 17 153.930 169.779
Interest expense calculated using the effective interest method 17 (1.277.790) (1.189.178)
Other interest and similar expense 17 (130.014) (130.143)
Net interest income 66.975 63.171
Fees and commission income 18 1.672 1.688
Net fee and commission income 1.672 1.688
Change in allowance for expected credit losses on financial assets
and loan commitments
19 13.308 104.484
Net gains/(losses) on derivatives 20 (53.790) (44.394)
Net gains/(losses) on financial assets measured at amortized cost 21 58.468 21.274
Net gains/(losses) on financial liabilities measured at amortized
cost
21 (61.368) (1.283)
Other operating income 22 67 104
Net operating income/(loss) 25.332 145.044
Personnel expenses 23 (1.712) (1.850)
Depreciation of property, plant and equipment and right-of-use
assets
5 (340) (337)
Other operating expenses 24 (1.217) (1.172)
Total operating expenses (3.269) (3.359)
Profit/(loss) before tax from continuing operations 22.063 141.685
Income tax expense 25 (4.930) (36.552)
Profit/(loss) for the year 17.133 105.133
Profit attributable to:
Equity holders of the parent 17.133 105.133
Non- controlling interest - -
Profit for the year 17.133 105.133
Total comprehensive income attributable to:
Equity holders of the parent 17.133 105.133
Non- controlling interest - -
Total comprehensive income for the year 17.133 105.133
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Statement of changes in equity for the year ended 31 December 2024
(in thousands of EUR)
Is s ue d and paid-in
share capital
Share premium
re s e rve
Retained Earnings Total Equity
Balance at 1 January 2023 103.035 12.120 362.202 477.357
Profit (loss) and comprehensive income for the period - - 105.133 105.133
Balances at 31 December 2023 103.035 12.120 467.335 582.490
Balance at 1 January 2024 103.035 12.120 467.335 582.490
Profit (loss) and comprehensive income for the period - - 17.133 17.133
Balances at 31 December 2024 103.035 12.120 484.468 599.623
Notes 11 11
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Statement of cash flows for the year ended 31 December 2024
(in thousands of EUR)
31 December 2024 31 December 2023
Cash flow generated from operations
Interest received 1.330.869 1.128.883
Interest paid (1.247.158) (1.046.107)
Fees and commission income received - 1.600
Other operating income received 72 96
Guarantee fees paid (1.212) (1.498)
Paid bank charges, general expenes & salaries (3.533) (3.571)
Tax (paid)/refund (15.515) (8.807)
Ne t movement in c ash-pool re ceiva bles 635.708 (117.293)
Net cash from operating activities 699.231 (46.697)
Cash flow from investment activities
Loans issued to related parties (2.898.360) (4.273.354)
Collection of loans to related parties 3.442.095 3.868.687
Net cash from investment activities 543.735 (404.667)
Cas h flo w fro m financing ac tivitie s
Proceeds from bonds 1.190.657 3.818.668
Repayment of bonds (3.063.811) (3.379.494)
Proceeds from commercial papers 632.755 -
Repayment of loans from related parties - (85)
Proceeds from Derivatives 255.767 1.561.620
Cash outflows in respect of derivatives (258.009) (1.549.096)
Cash outflows in re spect of lease liabilitie s (325) (249)
Dividends paid - -
Net cash from (used in) financing activities (1.242.966) 451.364
Net change in cash and cash equivalents - -
Cash and cash equivalents at beginning of period
- -
Cash and cash e quivale nts at e nd of period - -
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Notes to the annual financial statements
for the year ended 31 December 2024
1. General
(a) Reporting entity
Volkswagen International Finance N.V. (‘VIF’ or ‘the Company’), founded in 1977, is a 100%
subsidiary of Volkswagen Finance Luxemburg S.A. (‘VFL’), who in turn is a 100% subsidiary of
Volkswagen AG (‘VWAG’).
VIF is a public limited liability company and domiciled and incorporated in The Netherlands.
VIF’s registered office is located at Paleisstraat 1, 1012 RB Amsterdam, The Netherlands. VIF is
registered with the Dutch Register of Commerce under No. 33148825. VIF maintains a website
at www.vif.nl.
The primary purpose of the Company is the financing of Group companies. VIF has access to
several funding sources such as bonds, notes and commercial paper as well as intercompany loans.
All external issuances of financial instruments are guaranteed by VWAG. VIF has lent the
proceeds of these borrowings to related parties of Volkswagen Group (‘VW Group’).
Due to its issuing activity in the capital markets, VIF is subject to the regulatory supervision by
the Dutch Financial Market Authority (Autoriteit Financiële Markten, ‘AFM’) and has to submit
its yearly and half-yearly reports to the AFM.
Bonds issued by VIF can be listed or unlisted. Most of the bonds outstanding as per 31 December
2024 and 31 December 2023 are listed at the Luxemburg Stock Exchange. The bond prospectuses
of the listed bonds have been approved by the Commission de Surveillance du Secteur Financier
of the Grand Duchy of Luxembourg (‘CSSF’).
In accordance with the Company’s Articles of Association, the allocation of the profit for the year
is subject to the decision of the shareholders. The shareholder Volkswagen Finance Luxemburg
S.A. (‘VFL’), resolved to adopt the financial statements and to allocate the profit for the year to
retained earnings on 11 March 2025.
This allocation is reflected in the financial statements as presented.
(b) Group information
In 2014, VIF became a 100% subsidiary of Volkswagen Finance Luxemburg S.A. (VFL), which
itself is 100% owned by Volkswagen AG (VWAG), the ultimate parent company. A consolidation
is performed at VWAG level and these consolidated financial statements can be obtained at their
website at www.volkswagen-group.com.
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2. Basis of preparation
(a) Statement of compliance
The financial statements and accompanying notes are prepared in accordance with the
International Financial Reporting Standards (‘IFRS’), as adopted by the European Union (‘EU-
IFRS) and in accordance with section 9, Book 2 of the Dutch Civil Code.
(b) Basis of measurement
With certain exceptions, such as derivatives, the financial statements have been prepared on a
historical cost basis. The methods used to measure individual items are explained in more detail
in the significant accounting policies disclosed in note 3 below.
(c) Basis for taxation
The current Dutch nominal tax rate of 25,8% has been applied. For further information, refer to
the significant accounting policies disclosed in note 3.
Profit tax is calculated on the profit before taxation in the statement of income and comprehensive
income, taking into account any losses carried forward from previous financial years (insofar as
these are not included in deferred tax assets), tax exempt items and non-deductible expenses.
Account is also taken of changes in deferred tax assets and deferred tax liabilities owing to
changes in the applicable tax rates.
(d) Functional and presentation currency
The financial statements are presented in Euros, which is the functional and presentational
currency of the Company. All financial information presented in Euros has been rounded to the
nearest thousand (€’000), unless otherwise stated. All figures shown are rounded, so minor
discrepancies may arise from addition of these amounts.
(e) Use of estimates and judgements
The preparation of the Company’s financial statements requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the
reported amount of revenue, expenses, assets and liabilities, and the accompanying disclosures,
as well as the disclosure of contingent liabilities. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognized prospectively. The areas involving a higher degree of judgment or
complexity, or areas where assumptions and estimates are significant to the financial statements
are disclosed below.
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Impairment losses on financial assets
The measurement of impairment losses under IFRS 9 across all categories of financial assets in
scope requires judgement. These estimates are driven by a number of factors, changes in which
can result in different levels of credit loss allowances.
Elements of the Company’s ECL models that are considered accounting judgements and estimates
include:
The criteria for assessing if there has been a significant increase in credit risk.
The development of ECL models, including the various formulas and choice of inputs
and their interdependencies.
Estimation of the amount and timing of future cash flows, collateral values and the
discount rates used when determining impairment losses.
Estimates and assumptions about the extent and probability of occurrence of future events remain
subject to a high degree of uncertainty because future business developments are subject to
uncertainties that in part cannot be influenced by the Company. As far as possible, estimates are
derived from experience taking into account current market data as well as rating categories and
scoring information.
The Financial risk management note and Impairments under the Significant accounting policies
disclosed in note 3 contain further details on how the Company determines ECL for financial
assets.
Fair value of financial instruments
When the fair values of financial assets and financial liabilities recorded in the statement of
financial position cannot be derived from active markets, they are determined using a variety of
valuation techniques that include the use of valuation models. The inputs to these models are
taken from observable markets where possible, but where this is not feasible, non-observable
inputs are required in establishing fair values.
The Fair values note below contains further details on how the Company determines the fair value
of financial instruments.
Effective interest rate (EIR) method
The Company’s EIR method recognizes interest income and expenses using a rate of return that
represents the best estimate of a constant rate of return over the expected behavioural life of
financial instruments and recognizes the effect of potentially different interest rates charged at
various stages and other characteristics of the instrument life cycle (including prepayments and
penalty interest and charges). This estimation, by nature, requires an element of judgement
regarding the expected behaviour and life-cycle of the instruments.
The section below entitled Recognition of net interest income under the Significant accounting
policies disclosed in note 3 contain further details on how the Company determines and applies
the EIR method.
Accounting for provisions
Accounting for provisions is based on estimates of the extent and probability of occurrence of
future events, as well as estimates of the discount rate. As far as possible, these are also based on
experience or external opinions. Any change in the estimates of the amount of other provisions is
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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always recognized in profit or loss. The provisions are regularly adjusted to reflect new
information obtained.
(f) Operating segments
An operating segment is a component of an entity that engages in business activities from which
it may earn revenues and incur expenses. An operating segment’s operating results are regularly
reviewed by the chief operating decision maker to make decisions about resources to be allocated
to the segment and to assess its performance, and thus separate financial information is available.
The Company has determined that its Managing Director and the Supervisory Board are
collectively the chief operating decision maker. The segment information is reported in
accordance with the reporting to the Managing Director and is consistent with financial
information used for assessing performance and allocating resources. The Company has identified
one segment, as the Company is monitored at total Company figures.
(g) Standards issued but not yet effective
In its 2024 financial statements, VIF did not apply the following accounting pronouncements that
have been issued by the IASB until 31 December 2024, but were not yet required to be applied
for the financial year. The Company intends to adopt these new and amended standards and
interpretations, if applicable, when they become effective.
Publis he d by
the IASB
Mandatory
application
Endorse d
by the EU
Expe cte d impact
IFRS 9/
IFRS 7
Classification and Measurment of
Financial Instruments
30 May 2024 1 Jan 2026 No No material impact
IFRS 9/
IFRS 7
Contracts Referencing Nature-
dependet Electricity
18 Dec 2024 1 Jan 2026 No No material impact
IFRS 18
Presentation and Disclosure in
Financial Statements
09 Apr 2024 1 Jan 2027 No Impact currently being analyzed
IFRS 19
Subsidaries without Public
Accountability: Disclosures
09 May 2024 1 Jan 2027 No No impact
IAS 21
Currency translation if currency is
inconvertible
15 Aug 2023 1 Jan 2025 Yes No material impact
Annual Improvements to IFRS
Accounting Standards -
Volume 11
1
28 Jul 2024 1 Jan 2026 No No material impact
Standard/Inte rpretation
1
Minor amendements to a number of IFRSs (IFRS 1, IFRS 7, IFRS 9, IFRS 10 and IAS 7).
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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(h) Change in presentation
During the current financial year, the company has implemented a change in the presentation of
its cashflow statement to provide more detailed information regarding its financing activities.
Specifically, the cash flows from financing activities related to repayments of borrowings and
proceeds from borrowings have been split into separate lines, based on the type of financial
instrument involved.
The new categories are:
Proceeds from bonds
Repayment of bonds
Proceeds from commercial papers
Repayments of commercial papers
Proceeds from loans from related parties
Repayments of loans to related parties
This change in presentation enhances the transparency and understanding of the Company's
financing activities, as it now separately shows the cash flows related to different types of
financial instruments.
The change has been applied retrospectively, and the comparative information for the prior year
has been restated accordingly. The impact of the change on the cash flow statement is as follows:
These changes do not affect the total cash and cash equivalents for the period, nor do they impact
the profit for the year or equity of the Company.
(in thousands of EUR)
Previously Presented Restated
Cas h flo w fro m financing activ itie s
Proceeds from borrowings 3.818.668 -
Repayment of borrowings (3.379.579) -
Proceeds from bonds - 3.818.668
Repayment of bonds - (3.379.494)
Repayment of loans from related parties - (85)
Proceeds from Derivatives 1.561.620 1.561.620
Cash outflows in respect of derivatives (1.549.096) (1.549.096)
Ca sh outflows in respec t of lea se lia bilities (249) (249)
Net cash from (used in) financing activities 451.364 451.364
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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3. Material accounting policy information
Information on the material accounting policies applied in the preparation of these financial
statements are set out below.
(a) Foreign currency translation
Foreign currency transactions
Transactions in foreign currencies are initially recorded in the functional currency of the Company
at the exchange rate ruling at the date of transaction.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional
currency at the exchange rate ruling at the reporting date. Non-monetary assets and liabilities that
are measured at fair value in a foreign currency are translated into the functional currency at the
exchange rate ruling on the date when the fair value was determined. Non-monetary items that
are measured based on historical cost in a foreign currency are translated at the exchange rate
ruling at the date of the transaction.
Foreign currency differences are recognized in profit or loss.
(b) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a
financial liability or equity instrument of another entity.
(i) Recognition and initial measurement
Trade receivables are initially recognized when they are originated. Regular way purchases or
sales of financial instruments are accounted for at the settlement date – that is, at the date on which
the asset is delivered. All other financial assets and financial liabilities are initially recognized
when the Company becomes a party to the contractual provisions of the instrument.
Trade receivables without a significant financing component are initially measured at the
transaction price. All other financial instruments are initially measured at fair value plus or minus,
for an instrument not at fair value through profit and loss (FVTPL), transaction costs that are
directly attributable to its acquisition or issue.
(ii) Classification and subsequent measurement
Financial assets are classified and measured on the basis of the entity’s business model and the
characteristics of the financial asset’s cash flows. On initial recognition financial assets are
classified into the following measurement categories:
financial assets at FVTPL;
financial assets at fair value through other comprehensive income (OCI) and
financial assets at amortized cost.
Financial assets are not reclassified subsequent to their initial recognition unless the Company
changes its business model for managing financial assets, in which case all affected financial
assets are reclassified on the first day of the first reporting period following the change in the
business model.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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Financial liabilities are classified into the following categories:
financial liabilities at FVTPL; and
financial liabilities measured at amortized cost.
A compound financial instrument which contains both a liability and an equity component is
separated at the issue date. When allocating the initial carrying amount of a compound financial
instrument to the equity and liability components, the equity component is assigned as the residual
amount after deducting from the entire fair value of the instrument, the amount separately
determined for the liability component. The value of any derivative features (such as a call
options) embedded in the compound financial instrument, other than the equity component (such
as an equity conversion option), is included in the liability component. Once the Company has
determined the split between equity and liability, it further evaluates whether the liability
component has embedded derivatives that must be separately accounted for.
Financial assets – Business model assessment
The Company’s business model for managing financial assets refers to how it manages its
financial assets in order to generate cash flows; it determines whether cash flows will result from
collecting contractual cash flows, selling the financial assets, or both.
The Company makes an assessment of the business model in which a financial asset is held at a
portfolio level because this best reflects the way the business is managed and information is
provided to management. The Company has one central business model according to which it
provides loans to related parties and therefore makes a single assessment for all loans to related
parties.
Financial assets – Assessment whether contractual cash flows are solely payments of principal
and interest
For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset
on initial recognition and may change over the life of the financial asset. ‘Interest’ is defined as
consideration for the time value of money and for the credit risk associated with the principal
amount outstanding during a particular period of time and for other basic lending risks and costs
(e.g. liquidity risk and administrative costs), as well as a profit margin.
In assessing whether the contractual cash flows are solely payments of principal and interest, the
Company considers the contractual terms of the instrument. This includes assessing whether the
financial asset contains a contractual term that could change the timing or amount of contractual
cash flows such that it would not meet this condition. In making this assessment, the Company
considers:
contingent events that would change the amount or timing of cash flows;
terms that may adjust the contractual coupon rate, including variable-rate features;
prepayment and extension features; and
terms that limit the Company’s claim to cash flows from specified assets (e.g. non-
recourse features).
Contractual terms that introduce a more than de minimis exposure to risks or volatility in the
contractual cash flows that are unrelated to a basic lending arrangement do not give rise to
contractual cash flows that are solely payments of principal and interest on the amount
outstanding.
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Financial assets and liabilities at amortized cost
A financial asset is measured at amortized cost if it meets both of the following conditions and is
not designated as at FVTPL:
it is held within a business model whose objective is to hold assets to collect contractual
cash flows (“hold” business model); and
its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative
to which hedge accounting is not applied or it is designated as such on initial recognition. All
other financial liabilities, other than loan commitments and financial guarantees, are subsequently
measured at amortized cost.
The amortized cost of a financial asset or liability is the amount:
at which a financial asset or liability is measured at initial recognition;
minus any principal repayments; and
plus or minus the cumulative amortisation of any difference between the original amount
and the amount repayable at maturity (premium, discount), amortized using the effective
interest rate (EIR) method over the term of the financial asset or liability.
The amortized cost of financial assets is reduced by loss allowances and impairment losses.
Interest income, foreign exchange gains and losses and impairments are recognized in profit or
loss.
For the Company financial assets measured at amortized cost include loans to related parties,
trade and other receivables, and cash-pool receivables.
Interest expense and income and foreign exchange gains and losses related to financial liabilities
are recognized in profit or loss.
For the Company financial liabilities measured at amortized cost include debts issued and other
borrowed funds and trade and other payables.
For reasons of materiality, discounting or unwinding of discounting is not applied to current
liabilities (due within one year).
Financial assets and liabilities at FVTPL
Any financial assets not measured at either amortized cost or at FVTOCI are allocated to the
FVTPL category. Financial assets at FVTPL are aimed in particular at generating cash flows by
selling financial instruments (“sell” business model).
A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative
to which hedge accounting is not applied or it is designated as such on initial recognition.
These financial assets and liabilities are measured at fair value in the statement of financial
position, with net changes in fair value recognized in profit or loss. Interest and dividend income
are recorded in profit or loss according to the terms of the contract or when the right to payment
has been established. Interest expenses are also recorded in profit or loss.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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For the Company, this category primarily comprises derivatives in economic hedging
relationships (as described in more detail below) and investments in equity instruments.
Derivatives recorded at FVTPL
A derivative is a financial instrument or other contract with all three of the following
characteristics:
Its value changes in response to the change in a specified interest rate, financial
instrument price, commodity price, foreign exchange rate, index of prices or rates, credit
rating or credit index, or other variable, provided that, in the case of a non-financial
variable, it is not specific to a party to the contract (i.e., the 'underlying').
It requires no initial net investment or an initial net investment that is smaller than would
be required for other types of contracts expected to have a similar response to changes in
market factors.
It is settled at a future date.
The Company uses derivatives only for economic hedging purposes and not as speculative
investments. Derivatives are recognized on the respective trade date and recorded at fair value.
Derivatives are carried as assets when their fair value is positive and as liabilities when their fair
value is negative. Fair value changes and foreign exchange gains and losses for derivatives are
included in net operating income under Net gains/(losses) on derivatives.
Undrawn loan commitments
The Company provides loan commitments to related parties. Loan commitments are
commitments under which, over the duration of the commitment, the Company is required to
provide a loan with pre-specified terms to the borrower. These contracts are in the scope of IFRS
9 ECL provisions.
The nominal contractual value of undrawn loan commitments, where the loan agreed to be
provided is on market terms, are not recorded on in the statement of financial position. The ECL
in respect of undrawn loan commitments are presented with the Company’s provisions. The
nominal values of these instruments together with the corresponding ECL are disclosed in the
Provisions note 14.
(iii) Derecognition
Financial assets
The Company derecognizes a financial asset when the contractual rights to the cash flows from
the financial asset expire or when it transfers the financial asset and the transfer qualifies for
derecognition. A transfer only qualifies for derecognition when the Company transfers the rights
to receive the contractual cash flows in a transaction in which substantially all of the risks and
rewards of ownership of the financial asset are transferred or in which the Company neither
transfers nor retains substantially all of the risks and rewards of ownership, but has transferred
control of the asset.
The Company also derecognizes a financial asset, such as a loan to a related party, when the terms
and conditions have been renegotiated to the extent that, substantially, it becomes a new loan,
with the difference recognized as a derecognition gain or loss, to the extent that an impairment
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
23
loss has not already been recorded. Such substantial changes could be caused be change in spreads
(on top of variable interest), change in repayment structures or amounts, or forbearance.
Financial liabilities
The Company derecognizes a financial liability when its contractual obligations are discharged,
cancelled, or expire. The Company also derecognizes a financial liability when its terms are
modified and the cash flows of the modified liability are substantially different, in which case a
new financial liability based on the modified terms is recognized at fair value.
On derecognition of a financial liability, the difference between the carrying amount extinguished
and the consideration paid (including any non-cash assets transferred or liabilities assumed) is
recognized in profit or loss.
(iv) Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the statement
of financial position when, and only when, the Company currently has a legally enforceable right
to set off the amounts and it intends either to settle them on a net basis or to realize the asset and
settle the liability simultaneously.
(v) Fair value of financial instruments
The fair value is the price that would be received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at the measurement date. Fair value generally
corresponds to the market or quoted market price. If no active market exists, fair value is
determined using other observable inputs as far as possible. If no observable inputs are available,
the fair values of assets and liabilities are determined using valuation techniques, such as by
discounting future cash flows, taking into account customary market rates adequate to the relevant
risk and corresponding to the relevant maturity, or by using recognized option pricing models,
and, as far as possible, verified by confirmations from the banks that handle the transactions.
The Fair values note below contains further details on how the Company determines the fair value
of financial instruments.
(vi) Hedge accounting
The Company does not apply hedge accounting.
(c) Share capital
Ordinary shares
The share capital consist of ordinary shares. Incremental costs directly attributable to the issue of
ordinary shares, net of any tax effects, are recognized as a deduction from equity. Income tax relating
to transaction costs of an equity transaction is accounted for in accordance with IAS 12.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
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(d) Impairment
(i) Financial assets
IFRS 9 requires the Company to assess on a forward-looking basis the expected credit losses
associated with their debt instruments carried at amortized cost. The rules on impairment also
apply to risks from irrevocable loan commitments not recognized in the statement of financial
position and to the measurement of financial guarantees.
The impairment methodology applied depends on whether there has been a significant increase
in credit risk, except for loss allowances for trade receivables and contract assets which are always
measured at an amount equal to lifetime ECLs.
When determining whether the credit risk of a financial asset has increased significantly since
initial recognition and when estimating ECLs, the Company considers reasonable and supportable
information that is relevant and available without undue cost or effort. This includes both
quantitative and qualitative information and analysis, based on the Company’s historical
experience and informed credit assessment and including forward-looking information.
Loans and receivables to related parties and undrawn loan commitments provided to related
parties
Loans to related parties are subject to credit default risk, which is taken into account by
recognizing a loss allowance for ECL or, if losses have already been incurred, by recognizing
impairment losses. Loan receivables are classified into one of the three stages of the ECL model
depending on their relative change in credit risk since initial recognition. At the relevant reporting
dates, the Company examines each individual loan receivable to determine the appropriate stage.
For loan commitments, the Company uses the stage of the corresponding loan. The loss allowance
and the interest revenue on the loan receivable are then calculated according to the assigned stage:
Stage 1
Captures all loan receivables at initial recognition provided they are not credit-impaired when
originated. Loan receivables will remain in stage 1 if the credit risk has not increased significantly
since initial recognition. If the internal risk management and control systems do not indicate a
significant increase in credit risk any earlier, the general presumption in the VW Group is that a
significant increase in credit risk has occurred when payments are more than 30 days overdue.
A loss allowance at an amount equal to the 12-month ECL is recognized and the interest revenue
is calculated based on the effective interest on the gross carrying amount of the asset.
Stage 2
If the credit risk as of the reporting date has increased significantly since initial recognition, the
loan receivable will be transferred to stage 2. A significant increase is defined as a drop in the
credit rating to a non-investment grade level, or if the loan was originated at a non-investment
grade rating, a significant increase would constitute as a decrease of two or more notches in the
rating.
The loss allowance is adjusted to an amount equal to the lifetime ECL and the interest revenue
remains calculated based on the effective interest on the gross carrying amount of the asset.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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Stage 3
If there is objective evidence of impairment since the last reporting date, the loan receivable will
be transferred to stage 3. Objective evidence of impairment is defined as a probability of default
(PD) of 100% as indicated by credit-risk-related market data. Other criteria such as breach of
contract, default or delinquency in interest or principal payments or an overdue payment greater
than 90 days may also constitute a transfer to stage 3. If there is no reason to assume a default has
occurred any earlier based on the internal risk management and control systems, the general
presumption in the VW Group is that a default has occurred when payments are more than 90
days overdue. Internal risk management and control systems include daily monitoring of
payments to identify any overdue payments. The Group Treasury Department of VWAG also
tracks any significant changes in the credit risk of related parties on a monthly basis, to ensure
prompt identification of any possible risks of default.
The loss allowance remains equal to the lifetime ECL and the interest revenue is calculated based
on the net carrying amount of the asset. Although loan receivables allocated to stage 3 provide
clear evidence of impairment, there may still be a reasonable expectation that the asset can be
fully or partially recovered. At the point in time there is no longer a reasonable expectation that
the borrower will be able to fully or partially settle its liability, the asset will be written off.
The Company has not used the low credit risk exemption for any financial instruments in the year
ended 31 December 2024 and no receivables were past due for more than 30 days.
Measurement of ECLs
ECLs are measured in accordance with Group-wide standards as a probability-weighted estimate
of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the
difference between the cash flows due to the Company in accordance with the contract and the
cash flows that the Company expects to receive). Average historical default probabilities are used
in combination with forward-looking parameters for the financial asset concerned. Various
possible scenarios from the amount and timing of the expected cash flows are weighted at their
probability of occurrence. The inputs required to be included in the ECL model include relevant
macroeconomic factors (for example Gross Domestic Product and Consumer Price Index rates).
When the time value of money is material, ECLs are discounted at the effective interest rate of
the financial asset.
Lifetime ECLs are the ECLs that result from all possible default events over the expected life of
a financial instrument. 12-month ECLs are the portion of ECLs that result from default events
that are possible within the 12 months after the reporting date (or a shorter period if the expected
life of the instrument is less than 12 months). The maximum period considered when estimating
ECLs is the maximum contractual period over which the Company is exposed to credit risk.
Measurement of ECLs in respect of loans and receivables and loan commitments to related
parties
The loss allowance for all loan receivables and other exposures where the counterparty is a
consolidated company of the VW Group is calculated analogously to the determination of the loss
allowance for external financial assets (as described above). However, if this is not possible
considering the associated costs and efforts, e.g. because there are neither external nor internal
ratings available for the group internal counterparty, the calculation may be based on:
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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the credit default swap spread (“CDS”) or expected percentage losses (“EPL”) value of
the counterparty, if available; or
the CDS of VWAG consistently for all group internal receivables; or
any other method that leads to similar results.
For loans and receivables to related parties, the loss allowance is calculated as the product of the
Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD). The
product of PD and LGD is determined by the CDS of VWAG, as there are no external or internal
ratings available for the group-internal counterparties.
For loan commitments to related parties, the loss allowance is calculated as the product of PD,
LGD and EAD. The product of PD and LGD is determined by the CDS of VWAG, as there are
no external or internal ratings available for the group-internal counterparties. And the EAD is the
nominal amount of the commitment multiplied by a Credit Conversion Factor (CCF).
Presentation of allowance for ECL in the statement of financial position
Loss allowances for financial assets measured at amortized cost are deducted from the gross
carrying amount of the assets. Loss allowances in respect of loan commitments are presented
within provisions.
Write-off
The gross carrying amount of a financial asset is written off when the Company has no reasonable
expectations of recovering a financial asset in its entirety or a portion thereof. For loans to related
parties, the Company individually makes an assessment with respect to the timing and amount of
write-off based on whether there is a reasonable expectation of recovery.
(ii) Non-financial assets
At each reporting date, the Company reviews the carrying amounts of its non-financial assets to
determine whether there is any indication of impairment. If any such indication exists, then the
asset’s recoverable amount is estimated.
For impairment testing, assets are grouped together into the smallest group of assets that generates
cash inflows from continuing use that are largely independent of the cash inflows of other assets
or Cash Generating Units (CGUs).
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less
costs to sell. Value in use is based on the estimated future cash flows, discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset or CGU.
An impairment loss is recognized if the carrying amount of an asset or CGU exceeds its
recoverable amount. Impairment losses are recognized in profit or loss. They are allocated to
reduce the carrying amounts of the assets in the CGU on a pro rata basis.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognized.
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(e) Property, plant and equipment
(i) Recognition and measurement
Property, plant and equipment are stated at historical cost less accumulated depreciation and
accumulated impairment losses as applicable. Historical cost includes expenditure that is directly
attributable to the acquisition of an item.
Subsequent costs are included in the asset's carrying amount or recognized as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will
flow to the Company and the cost of the item can be measured reliably. All other repairs and
maintenance expenses are charged to the income statement during the financial period in which
they are incurred.
Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit
or loss.
(ii) Depreciation and impairment
Depreciation is calculated to write off the cost of items of property, plant and equipment less their
estimated residual values using the straight-line method over their estimated useful lives, and is
recognized in profit or loss.
The estimated useful lives of property, plant and equipment for current and comparative periods
are as follows:
Type of Asset Useful life
Office equipment 5
y
ears
Transport equipment 5
y
ears
Furniture and fixtures 10
y
ears
Computer hardware 3
y
ears
Depreciation methods, useful lives and residual values are reviewed at each reporting date and
adjusted if appropriate.
Impairment losses on property, plant and equipment are recognized in accordance with IAS 36
where the recoverable amount of the asset concerned has fallen below the carrying amount. The
recoverable amount is the higher of value in use and fair value less costs to sell. If the reasons for
impairments recognized in previous years no longer apply, the impairment losses are reversed up
to a maximum of the amount that would have been determined if no impairment loss had been
recognized.
(f) Leases
The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if
the contract conveys the right to control the use of an identified asset for a period of time in
exchange for consideration. The Company recognizes a right-of-use asset and lease liability at the
commencement date of a lease (i.e., the date the underlying asset is available for use).
The lease liability is measured at the present value of the lease payments to be made over the lease
term. The payments can include fixed, fixed-in-substance and variable payments, less any lease
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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incentives and amounts expected under residual value guarantee. Variable lease payments that do
not depend on an index or a rate are recognized as expenses in the period in which the event or
condition that triggers the payment occurs.
In calculating the present value of the lease payments, the lease liability is discounted using the
incremental borrowing rate from VW Group’s perspective. After commencement the lease
liability is increased as a result of interest charged at a constant rate on the outstanding liability
and reduced for the lease payments made. If there is a lease modification the carrying amount of
the lease liability is remeasured.
Right-of-use assets are measured at cost, less any accumulated depreciation and impairment
losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets
includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments
made at or before the commencement date less any lease incentives received. Right-of-use assets
are depreciated on a straight-line basis over the lease term as disclosed under property, plant and
equipment above.
The determination of the lease terms considers all relevant facts and circumstances that create an
economic incentive to exercise or not to exercise extension and termination options. Optional
periods are taken into account in determining the lease term, if it is reasonably certain that the
option will or will not be exercised.
The right-of-use assets are reported in the statement of financial position under those items in
which the assets underlying the lease would have been recognized if the Company had been the
beneficial owner. For this reason, the right-of-use assets are presented under non-current assets in
property, plant and equipment and included in impairment tests of property, plant and equipment
conducted in accordance with IAS 36.
Right-of-use assets mainly relates to a lease contract with Stichting Administratiekantoor Jong B
Monument for the office space in Paleisstraat 1 in Amsterdam.
Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is
reasonably certain that the Company will obtain ownership by the end of the lease term.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
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The lease terms in respect of right-of-use assets are as follows:
Right-of-use Asset Lease term
Buildin
g
s 10
y
ears
Motor vehicles 3
y
ears
The lease liabilities are presented in other liabilities in the statement of financial position.
Short term leases and leases of low value assets
The Company applies the short-term lease recognition exemption to leases with a term of 12
months or less. It also applies the lease recognition exemption to leases that are considered to be
low value. Lease payments of short term or low value leases are recognized as an expense on a
straight-line basis over the lease term.
(g) Cash
Cash comprises cash on hand, current accounts with banks, deposits held at call with banks, and
other short-term highly liquid investments with original maturities of three months or less. For
the purposes of the statement of cash flows, cash and cash equivalents consist of cash and short-
term deposits defined above. Cash and cash equivalents are initially measured at fair value, and
subsequently at amortized cost.
(h) Cash-pool receivables
The Company participates in the Volkswagen International Belgium N.V. cash-pool. Receivables
and liabilities to the Volkswagen International Belgium N.V. cash-pool are presented as cash-
pool receivables or liabilities.
(i) Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) as
a result of past events, and it is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation, and a reliable estimate can be made of the amount
of the obligation. When the effect of the time value of money is material, the Company determines
the level of provision by discounting the expected cash flows at a pre-tax rate reflecting the current
rates specific to the liability. The expense relating to any provision is presented in the income
statement net of any reimbursement in other operating expenses. The increase in the provision
due to the passage of time is recognized as interest expense.
(j) Interest income and interest expenses
The effective interest rate method
Under IFRS 9, interest income and interest expenses are recorded using the effective interest rate
(“EIR”) method for all financial assets and liabilities measured at amortized cost. For the
Company this mainly includes interest income from loans to related parties and interest expense
on debt issued and other borrowed funds, as well as the interest expense recognized on lease
liabilities.
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The EIR is the rate that exactly discounts estimated future cash flows through the expected life of
a financial instrument or, when appropriate, a shorter period, to the gross carrying amount of the
financial asset or the amortized cost of a financial liability.
The EIR (and therefore, the amortized cost of the financial instrument) is calculated by taking
into account transaction costs and any discount or premium on the acquisition of the financial
instrument, as well as fees and costs that are an integral part of the EIR. The Company recognizes
interest income and expenses using a rate of return that represents the best estimate of a constant
rate of return over the expected life of the financial instrument. Hence, the EIR calculation also
takes into account the effect of potentially different interest rates that may be charged at various
stages of the financial instrument’s expected life, and other characteristics of the product life cycle
(including prepayments, penalty interest and charges).
If expectations of fixed rate financial assets’ or liabilities’ cash flows are revised for reasons other
than credit risk, then changes to future contractual cash flows are discounted at the original EIR
with a consequential adjustment to the carrying amount. The difference from the previous
carrying amount is booked as a positive or negative adjustment to the carrying amount of the
financial asset or liability on the balance sheet with a corresponding increase or decrease in
interest revenue/expense calculated using the effective interest method.
For floating-rate financial instruments, periodic re-estimation of cash flows to reflect the
movements in the market rates of interest also alters the effective interest rate, but when
instruments were initially recognized at an amount equal to the principal, re-estimating the future
interest payments does not significantly affect the carrying amount of the asset or the liability.
The Company calculates interest income on financial assets, other than those considered credit-
impaired, by applying the EIR to the gross carrying amount of the financial asset. When a financial
asset becomes credit-impaired (Stage 3 of the ECL model), the Company calculates interest
income by applying the EIR to the net amortized cost of the financial asset. If the financial asset
cures and is no longer credit-impaired, the Company reverts to calculating interest income on a
gross basis.
Interest and similar income or expenses
Net interest income comprises interest income and interest expense calculated using both the
effective interest method and other methods. These are disclosed separately in the statement of
profit or loss and comprehensive income for both interest income and interest expense to provide
symmetrical and comparable information.
In its interest income or expense calculated using the effective interest method, the Company only
includes interest on those financial instruments that are set out in The effective interest rate method
above.
Other interest and similar income or expenses include interest on derivatives in economic hedge
relationships and all financial instruments measured at FVTPL (using the contractual interest
rate), interest income from cash-pool receivables.
(k) Fee income
VIF earns fee income from services it provides to related parties (customers) in accordance with
Service Level Agreements (contracts) in place between VIF and its customers. VIF provides
services required for the business operations of its customers and charges fees based on the costs
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
31
incurred in providing the services. Fee income is recognized at an amount that reflects the
consideration to which VIF expects to be entitled in exchange for providing the services.
The performance obligations, as well as the timing of their satisfaction, are identified, and
determined, at the inception of the contracts. The Company’s revenue contracts do not include
multiple performance obligations. As the benefit to the customers is transferred evenly over the
contract period, these fees are recognized as revenue evenly over the contract period, based on
time elapsed.
Payment of these fees is normally due and received monthly, based on VIF’s budgeted costs, with
an annual adjustment being made based on the actual costs included in the annual financial
statements of VIF.
(l) Net gains/losses on derivatives
Net gains/losses on derivatives represent fair value changes and foreign exchange differences on
non-trading derivatives held for risk management purposes.
(m) Net gains/losses on financial assets and financial liabilities measured at
amortized cost
Net gains/losses on financial instruments measured at amortized cost represent foreign exchange
differences on financial assets and financial liabilities measured at amortized cost.
(n) Income tax
Income tax expense comprises current and deferred tax. It is recognized in profit or loss.
Interest and penalties related to income taxes are accounted for under IAS 37 Provisions,
Contingent Liabilities and Contingent Assets. Uncertain tax treatments are accounted for under
IFRIC 23 Uncertainty over Income Tax Treatments and IAS 12 Income Taxes.
Current tax
Current tax assets and liabilities for the current and prior years are measured at the amount
expected to be recovered from, or paid to, the taxation authorities. The tax rates and tax laws used
to compute the amount are those that are enacted, or substantively enacted, by the reporting date.
Current tax assets and liabilities are offset only if there is both a legal right to offset and it’s the
Company’s intention to settle on a net basis.
Management periodically evaluates positions taken in the tax returns with respect to situations in
which applicable tax regulations are subject to interpretation and establishes provisions where
appropriate.
Deferred tax
Deferred tax is recognized in respect of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognized for temporary differences on the initial recognition of goodwill or
of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit or loss. Deferred tax assets are recognized for unused tax losses,
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
32
unused tax credits and deductible temporary differences to the extent that it is probable that future
taxable profits will be available against which they can be used. Future taxable profits are
determined based on the reversal of relevant taxable temporary differences. If the amount of
taxable temporary differences is insufficient to recognize a deferred tax asset in full, then future
taxable profits, adjusted for reversals of existing temporary differences, are considered, based on
the business plans of the Company. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit will be realized; such
reductions are reversed when the probability of future taxable profits improves.
Unrecognized deferred tax assets are reassessed at each reporting date and recognized to the
extent that it has become probable that future taxable profits will be available against which they
can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
when they reverse, using tax rates enacted or substantively enacted at the reporting date. The
measurement of deferred tax reflects the tax consequences that would follow from the manner in
which the Company expects, at the reporting date, to recover or settle the carrying amount of its
assets and liabilities.
Deferred tax assets and liabilities are offset only if there is both a legal right to offset and it’s the
Company’s intention to settle on a net basis.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
33
4. Operating segment information
The Company only has one operating segment and undertakes its operations in the Netherlands.
The majority of the Company’s income relates to interest received on loans to related parties of
the VWAG Group (‘related parties’) and the total reported revenue relates to external customers.
Furthermore, the vast majority of VIF’s receivables and interest revenue is from Volkswagen AG,
as indicated in the tables below.
(in thousands of EUR)
31 December 2024 31 December 2023
Interest reve nue by location of relate d partie s
Germany 1.184.158 1.129.644
Other countries 136.691 83.068
Total interest re venue calculated using the effective
interest method
1.320.849 1.212.713
Interest revenue from Volkswagen AG 985.645 942.913
Interest revenue from Volkswagen AG (%)
75% 78%
(in thousands of EUR)
31 December 2024 31 December 2023
Loans receivable by location of related parties
Germany 30.635.019 33.141.703
Other countries 3.377.245 1.343.832
Total 34.012.264 34.485.535
Less: current portion of loans receivables (5.459.362) (3.679.565)
Add: other non-current assets 59.480 52.993
Total non-current assets of the company 28.612.382 30.858.963
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
34
5. Property, equipment and right-of-use assets
(in thousands of EUR)
Owned assets Right-of-use assets
Business and office
equipment, Other
installations
Buildings,
Motor Vehicles
Total
Cost
As at 1 January 2023 466 1.309 1.775
Additions 9 175 184
Disposals - (146) (146)
As at 31 December 2023 475 1.338 1.813
Additions 7 1.180 1.187
Disposals (117) (140) (257)
As at 31 December 2024 365 2.378 2.743
Depreciation and disposals
As at 1 January 2023 (416) (848) (1.264)
Depreciation charge for the year (26) (310) (336)
Disposals - 132 132
As at 31 December 2023 (442) (1.026) (1.468)
Depreciation charge for the year (26) (314) (340)
Disposals 117 112 229
As at 31 December 2024 (351) (1.228) (1.579)
Net book value
As at 1 January 2023 50 461 511
As at 31 December 2023 33 312 345
As at 31 December 2024 14 1.150 1.164
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
35
Nature of leasing activities
The leases relate to 5 vehicles with an average lease term of 3 years and a lease agreement for
office space in Paleisstraat 1 in Amsterdam, which was extended in 2024 for an additional 5 years.
Set out below are the carrying amounts of lease liabilities (included under Other liabilities in
Note 13) and the movements during the period:
The maturity analysis of the contractual cash flows related to lease liabilities are disclosed under
Liquidity in the Financial risk management note below.
6. Classification of financial instruments
The Company holds the following financial instruments classified by IFRS 9 measurement
categories:
Financial assets
(in thousands of EUR)
Cash movements Non-cash movements Total
As at 1 January 2023 (1.090) 1.562 472
Additions - 178 178
Accretion of interest - (4) (4)
Payments (324) - (324)
As at 31 December 2023 (1.414) 1.736 322
Additions - 1.086 1.086
Accretion of interest 89 89
Payments (325) - (325)
As at 31 December 2024 (1.739) 2.911 1.172
(in thousands of EUR)
Non-current assets
Loans to related parties 7 - 28.552.902 28.552.902
Derivative financial instruments 8 20.097 - 20.097
20.097 28.552.902 28.572.998
Current assets
Loans to related parties 7 - 5.459.362 5.459.362
Derivative financial instruments 8 1.127 - 1.127
Cash-pool receivables 10 - 101.345 101.345
1.127 5.562.363 5.563.490
Total 21.224 34.115.264 34.136.488
Financial assets
31 December 2024
Notes
Measured at fair
value through P/L
Measured at
amortized cost
Total carrying
amount
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
36
Financial liabilities
(in thousands of EUR)
Non-current assets
Loans to related parties 7 - 30.805.970 30.805.970
Derivative financial instruments 8 26.208 - 26.208
26.208 30.805.970 30.832.178
Current assets
Loans to related parties 7 - 3.679.565 3.679.565
Derivative financial instruments 8 37.628 - 37.628
Cash-pool receivables 10 - 736.930 736.930
37.628 4.416.495 4.454.123
Total 63.836 35.222.465 35.286.301
31 December 2023
Financial ass e ts Note s
Me asure d at fair
value through P/L
Measured at
amortize d cos t
Total carrying
amount
(in thousands of EUR)
Non-current liabilities
Debts issued and other borrowed funds 12 - (28.800.562) (28.800.562)
Derivative financial instruments 8 (16.514) - (16.514)
(16.514) (28.800.562) (28.817.076)
Current liabilities
Debts issued and other borrowed funds 12 - (4.731.823) (4.731.823)
Derivative financial instruments 8 (17.598) - (17.598)
Trade and other payables - (40) (40)
(17.598) (4.731.863) (4.749.462)
Total (34.113) (33.532.425) (33.566.538)
31 December 2024
Financial liabilities Note s
Me as ure d at fair
value through P/L
Total carrying amount
Me as ure d at
amortize d cos t
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
37
7. Loans to related parties
Amounts due from related parties are measured at amortized cost and included in non-current
and current assets:
Refer to the section below entitled Fair values for details on how the Company determines the
fair value of financial instruments.
Gross carrying amount of loans to related parties
The gross carrying amount of loans to related parties exposed to credit risk is disclosed below,
classified by the residual maturity and original currency of the loans:
(in thousands of EUR)
Non-current liabilities
Debts issued and other borrowed funds 12 - (31.028.452) (31.028.452)
Derivative financial instruments 8 (18.222) - (18.222)
(18.222) (31.028.452) (31.046.675)
Current liabilities
Debts issued and other borrowed funds 12 - (3.675.851) (3.675.851)
Derivative financial instruments 8 (186) - (186)
Trade and other payables - (194) (194)
(186) (3.676.044) (3.676.231)
Total (18.408) (34.704.497) (34.722.905)
31 December 2023
Financial liabilities Notes
Me as ure d at fair
value through P/L
Total carrying amount
Me as ure d at
amortize d cos t
(in thousands of EUR)
Loans to related parties
Non-current Current Total
Loan outstanding
28.552.902 5.459.362 34.012.264 34.607.121
Total
28.552.902 5.459.362 34.012.264 34.607.121
Me asure d at amortize d cos t
31 December 2024
Carrying amount in s tate ment of financial position
Fair value
(in thousands of EUR)
Loans to related parties
Non-current Current Total
Loan outstanding
30.805.970 3.679.565 34.485.535 34.954.981
Total
30.805.970 3.679.565 34.485.535 34.954.981
31 December 2023
Carrying amount in s tate ment of financial position
Fair value
Me asure d at amortize d cos t
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
38
The above stated weighted average effective interests rate are calculated for the outstanding loans
as per year end and constitute fixed rates.
The maturity analysis of the contractual cash flows related to Volkswagen Group company loans
are disclosed under Liquidity in the Financial risk management note.
Impairment losses on loans to related parties
The Company determined that there is a low risk of default on all receivables due from Group
companies due to various factors explained in under Credit risk in the Financial risk management
note below. Although the Company determined that there is a low risk of default on loans
receivable, the Company has recognized loss allowances in accordance with IFRS 9.
(in thousands of EUR)
Loans to related parties classified by residual maturity
Residual maturity: less than 1 year
EUR 3,66% 4.838.373 2,40% 3.609.751
GBP 4,70% 430.066 0,85% 75.042
CZK - - 7,13% 218
CNY 4,03% 199.294 4,03% 2.056
5.467.733 3.687.067
Residual maturity: 1 to 5 years
EUR 3.77% 17.900.263 3,78% 17.161.773
GBP 4,70% 396.452 5,19% 780.876
CNY 0,00% - 4,03% 190.359
18.296.715 18.133.008
Residual maturity: longer than 5 years
EUR 3,79% 10.058.681 3,35% 12.503.721
GBP 4,70% 314.743 4,93% 300.656
10.373.424 12.804.377
34.137.872 34.624.452
(125.608) (138.917)
34.012.264 34.485.535
Carrying amount
31 December 2024
Average
interest rate
(
%
)
Gross carrying
amount
Total gross carrying amount
31 December 2023
Original currency
Average
interest rate
(
%
)
Gross carrying
amount
Allowance for ECL
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
39
The Company applied the credit default swap spread (CDS) of VWAG to measure the ECL for
all amounts due from Group companies. The loss allowances were recognized in accordance with
Stage 1 of the Company’s ECL model at an amount equal to the 12-month ECL.
A reconciliation of changes in gross carrying amount of the loans to related parties and
corresponding allowance for ECL is as follows:
The Company also provides loan commitments to related parties. The nominal value and related
ECL provision is disclosed in the Provisions note below.
The total income statement charge for allowance for ECL for the year in respect of loans to related
parties and the related loan commitments are disclosed in the Change in allowance for expected
credit losses on financial assets and loan commitments note. More details regarding the
measurement of ECL are disclosed in the Credit risk section in the Financial risk management
note below.
8. Derivative financial instruments
VIF uses derivatives only for economic hedging purposes and not as speculative investments, as
explained in the Summary of significant accounting policies above. VIF does not apply hedge
accounting.
The Company’s policy is to fully hedge its interest rate and foreign exchange rate exposures. It
uses derivatives to manage interest and foreign exchange exposures that arise as result of
mismatches between debt issued in the capital markets and loans issued to related parties. On this
basis the fair value changes in derivatives are primarily driven by changes in the applicable
currencies and related interest curves.
The Company’s derivative assets and liabilities are not offset in the statement of financial
position. Derivatives are presented as current assets or liabilities to the extent they are expected
to be settled within 12 months after the end of the reporting period.
(in thousands of EUR)
Gross carrying
amount
ECL Carrying amount
At 1 January 2023 34.093.251 (243.263) 33.849.988
Loans advanced 4.273.354 (17.521) 4.255.833
Loan repayments received (3.868.687) 15.862 (3.852.825)
Re-measurement of year-end ECL - 106.523 106.523
Interest accrued 105.484 (432) 105.052
Foreign exchange adjustments 21.051 (86) 20.965
At 31 December 2023 34.624.452 (138.917) 34.485.535
Loans advanced 2.898.360 (11.883) 2.886.477
Loan repayments received (3.442.095) 14.113 (3.427.982)
Re-measurement of year-end ECL - 11.314 11.314
Interest accrued (1.276) 5 (1.271)
Foreign exchange adjustments 58.431 (240) 58.191
At 31 December 2024 34.137.872 (125.608) 34.012.264
Sta
g
e 1
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
40
The tables below show the fair values of derivative instruments recorded as assets or liabilities
together with their notional amounts. The notional amount, recorded gross, is the quantity of the
derivative contracts’ underlying instrument, being cross-currency interest rate swaps (CCIRS),
interest rate swaps (IRS) or forward exchange contracts (FX Contracts). The notional amounts
indicate the volume of transactions outstanding at the year-end and are not indicative of either the
market or credit risk.
The Company’s exposure to derivative contracts is monitored on regular basis as part of its overall
risk management framework (as described in the Financial Risk Management note below).
Swaps
Swaps are contractual agreements between two parties to exchange streams of payments over time
based on specified notional amounts, in relation to movements in a specified underlying index such
as an interest rate, foreign currency rate or equity index.
Interest rate swaps relate to contracts taken out by the Company with other counterparties (financial
institutions) in which the Company either receives or pays a floating rate of interest, respectively,
(
in thousands o
f
EUR
)
Non-current 20.097 16.514 26.208 18.222
Current 1.127 17.598 37.628 186
Total 21.224 34.112 63.836 18.408
Derivatives in economic hedge
relationships
Liabilities
31 December 2023
Assets
31 December 2024
Assets Liabilities
Measured at fair value
(in thousands of EUR)
Assets Liabilities
CCIRS
293.637 21.224 34.106
IRS
- - -
FX Contracts
1.056 - 6
Total 294.693 21.224 34.112
31 December 2024
Derivatives in economic hedge relationships
N
otional contract
amount
Fair Value
(in thousands of EUR)
Assets Liabilities
CCIRS
162.067 26.201 18.399
IRS
1.250.000 37.617 -
FX Contracts
2.152 18 9
Total 1.414.219 63.836 18.408
31 December 2023
Fair Value
N
otional contract
amount
Derivatives in economic hedge relationships
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
41
in return for paying or receiving a fixed rate of interest. The payment flows are usually netted against
each other, with the difference being paid by one party to the other.
In a cross-currency interest rate swap, the Company pays a specified amount in one currency and
receives a specified amount in another currency. The swaps are mostly gross settled, settlement
dates being directly linked to the relevant payment dates of the interest and/or principal amounts of
the related loans and/or bonds.
Forward exchange contracts
Forward exchange contracts are contractual agreements to buy or sell a specified financial
instrument at a specific price and date in the future. FX Contracts are customised contracts
transacted in the over–the–counter market. FX Contracts are usually settled gross, settlement dates
being directly linked to the relevant payment dates of the interest and/or principal amounts of the
related loans and/or bonds.
Fair values
Further disclosures concerning the fair value and credit/market risk of derivatives are provided in
the Financial Risk Management note below.
9. Other assets
10. Cash-pool receivables
Cash-pool receivables constitutes a cash-pool arrangement with Volkswagen International
Belgium N.V.
All balances are at the free disposal of the Company and bear market interest rates. The cash-pool
receivable is carried at amortized cost and an allowance for ECL is not recognized, because it is
receivable on demand. VIF’s maximum exposure to credit risk in relation to cash-pool receivables
are represented by the carrying amounts for each respective year, as illustrated above.
(in thousands of EUR)
31 December 2024 31 December 2023
Current
Other assets 75 193
Rental deposit 19 18
Total 94 211
(in thousands of EUR)
31 December 2024 31 December 2023
Cash-pool receivables 101.345 736.930
Total 101.345 736.930
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
42
11. Capital and reserves
Share capital
Ordinary shares
Holders of these shares are entitled to dividends as declared from time to time, and are entitled to
one vote per share at general meetings of the Company.
The subscribed and paid-up share capital of the Company amounts to TEUR 103.035 (2023:
TEUR 103.035) and consists of 103.035 shares (2023: 103.035 shares) of €1.000 each which have
been authorised, registered and issued.
Share premium
The share premium of TEUR 12.120 relates to capital contributions of the shareholder
Volkswagen Finance Luxembourg S.A., to strengthen the financial position of the Company.
There are no restrictions on distribution of this reserve.
Distributions made and proposed
No final dividends for 2024 and 2023 were proposed.
12. Debt issued and other borrowed funds
Balances
(in thousands of EUR)
Non-current Current Tota
l
De bts is s ue d and othe r borrowed funds
Bonds 28.800.562 4.085.962 32.886.524 31.615.603
Comme rc ia l P apers
- 645.861 645.861 -
28.800.562 4.731.823 33.532.385 31.615.603
Total 28.800.562 4.731.823 33.532.385 31.615.603
31 December 2024
Me as ure d at amortize d cos t
Carrying amount in s tate ment of financial pos ition
Fair value
(in thousands of EUR)
Non-current Current Total
De bts is s ue d and othe r borrowed funds
Bonds 31.028.452 3.675.851 34.704.303 33.303.204
31.028.452 3.675.851 34.704.303 33.303.204
31 December 2023
Carrying amount in s tate ment of financial pos ition
Fair value
Me as ure d at amortize d cos t
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
43
The note below entitled Fair values contain details on how the Company determines the fair value
of financial instruments.
The maturity analysis of the above debts issued and other borrowed funds are disclosed under
Liquidity in the Financial risk management note below.
There are no pledges on the Company’s assets in connection with the above debts.
Movement schedule
The issuance in 2024 relates to below bonds:
In March 2024, VIF issued a floating rate bonds with an aggregate principal amount of €1,0
billion. The bond is due in March 2026 and has a principal amount of €1,0 billion with a coupon
of 3-month EURIBOR plus spread of 0,65%.
In August 2024, VIF issued a floating rate bonds with an aggregate principal amount of €1,0
billion. The bond is due in August 2026 and has a principal amount of €1,0 billion with a coupon
of 3-month EURIBOR plus spread of 0,55%.
In September 2024, VIF issued a fixed rate bonds with an aggregate principal amount of CNY1,5
billion. The bond is due in September 2027 and has a principal amount of CNY1,5 billion with a
(in thousands of EUR)
Cash
movements
Non-cash
movements
Total
As at 1 January 2024 - - 34.704.303
Issuance
1.823.411 - 1.823.411
Repayment (3.063.811) - (3.063.811)
Interest (1.270.588) 599.269 (671.319)
Amortization of issuance fees and discount
18.481 - 18.481
Foreign exchange adjustments
-
721.319 721.319
As at 31 December 2024 (2.492.506) 1.320.588 33.532.385
31 December 2024
(in thousands of EUR)
Cash
movements
Non-cash
movements
Total
As at 1 January 2023 - - 34.120.881
Issuance 3.818.668 -
3.818.668
Repayment
(3.379.579) -
(3.379.579)
Interest
(1.045.711) 612.695
(433.016)
Amortization of issuance fees and discount (17.177) -
(17.177)
Foreign exchange adjustments - 594.526
594.526
As at 31 December 2023 (623.799) 1.207.221 34.704.303
31 December 2023
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
44
coupon of 2,29%. The bond matures in 2027. A Cross-Currency Interest Rate Swap was also
traded in connection with this issuance.
The issuance in 2023 relates to below bonds:
In March 2023, VIF issued two fixed rate bonds with an aggregate principal amount of €1,75
billion. The first bond is due in March 2026 and has a principal amount of €1,0 billion with a
coupon of 3,875%. The second bond is due in March 2029 and has a principal amount of €0,75
billion with a coupon of 4,250%.
Moreover, in May and June 2023 VIF issued two fixed rate unlisted bonds in HKD, with a
nominal amount of HKD 320 million (EUR 38 million) and HKD 430 million (EUR 51 million),
respectively. Their maturities are in 2025 and 2026. Directly connected to each issuance, a Cross-
Currency Interest Rate Swap was traded.
Still in June 2023, a fixed rate listed bond in JPY was issued with a nominal of JPY 6 billion
(EUR 40 million). The bond matures in 2028. A Cross-Currency Interest Rate Swap was also
traded in connection with this issuance.
Furthermore, in early September 2023 VIF placed two unsecured subordinated hybrid notes with
an aggregate principal amount of €1,75 billion. The hybrid notes are perpetual, but may be called
unilaterally by VIF. The first possible call date for the first note (€1 billion and a coupon of 7,50%)
is after five years, and the first possible call date for the second note (€0,75 billion and a coupon
of 7,875%) is after nine years.
Lastly, by the end of September 2023, VIF placed its first CNY onshore bond under the Debt
Financing Instruments (DFI) program in China, regulated by the National Association of
Financial Market Institutional Investors (NAFMII). The bond is unlisted and has a fixed rate of
3,050%, with a nominal of CNY 1,5 billion (EUR 193 million). It matures in September 2025.
The proceeds of the bond were granted as an onshore loan.
The interest on the perpetual hybrid notes become due in the event of dividends being declared,
as determined on the discretion of VWAG. VIF has no influence on these mandatory payment
events, as it cannot prevent the declaration of dividends by VWAG. Accordingly the perpetual
hybrid notes were classified as liabilities.
Analysis of bonds
The following table reconciles the notional amount outstanding in respect of the bonds to the
total carrying amount of the bonds:
(in thousands of EUR)
31 December 2024 31 December 2023
Notional amount outstanding 32.387.963 34.199.566
Issuance fees & Bond discount
(286.414) (227.005)
Interest accrued
586.163 612.695
Cumulative amortization of Issuance fees & Bond discount
128.599 110.118
Foreign exchange adjustments
70.213 8.929
Carrying amount 32.886.524 34.704.303
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
45
The carrying amount and fair values of the bonds classified according to their residual maturity
and original currencies are as follows:
The above stated weighted average effective interest rates are calculated for the outstanding
amounts as per year end. All bonds issued by VIF are guaranteed by VWAG, mitigating the risk
to external investors. The bonds issued do not contain any financial covenants.
The credit ratings of the rating agencies are derived from VWAG’s rating:
(in thousands of EUR)
Original currency
Average interest
rate (%)
Carrying
amount
Fair value
Residual maturity of longer than 5 years
Listed fixed rate bonds EUR 3,00% 6.591.362 6.309.701
Listed fixed rate bonds GBP 4,13% 542.336 490.490
Residual maturity of less than 5 years
Listed fixed rate bonds EUR 2,88% 9.832.379 9.572.468
Listed fixed rate bonds GBP 3,38% 422.513 406.391
Listed fixed rate bonds JPY 1,00% 36.771 37.093
Listed variable rate bonds EUR 3,48% 1.002.481 1.004.456
Unlisted fixed rate bonds - onshore CNY 2,68% 397.432 401.727
Unlisted fixed rate bonds HKD 4,74% 95.346 93.817
Perpetual bonds
Listed fixed rate bonds EUR 4,50% 13.965.904 13.299.460
Total 32.886.524 31.615.603
31 December 2024
(in thousands of EUR)
Original currency
Average interest
rate (%)
Carrying
amount
Fair value
Residual maturity of longer than 5 years
Listed fixed rate bonds EUR 3,13% 7.560.552 7.357.677
Listed fixed rate bonds GBP 4,13% 517.712 480.860
Residual maturity of less than 5 years
Listed fixed rate bonds EUR 2,29% 9.346.216 9.025.225
Listed fixed rate bonds GBP 3,38% 403.156 385.560
Listed fixed rate bonds CNY 0,73% 65.272 63.546
Listed fixed rate bonds JPY 1,00% 38.277 39.274
Listed variable rate bonds EUR 5,53% 1.258.377 1.262.837
Unlisted fixed rate bonds - onshore CNY 2,29% 191.947 192.979
Unlisted fixed rate bonds HKD 4,74% 89.089 89.426
Perpetual bonds
Listed fixed rate bonds EUR 4,40% 15.233.705 14.405.820
Total 34.704.303 33.303.204
31 December 2023
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
46
Commercial paper
The basis for the issuing activities of the Company are the regularly updated Debt Issuance
Programme (DIP) of EUR 30 billion, that adheres to the European Prospectus Directive standards,
as well as the EUR 15 billion Multicurrency Commercial Paper Programme (CP Programme).
VIF is also issuing under stand-alone documentation. All issues are fully guaranteed by VWAG.
As of 31 December 2024 the Company has a balance of EUR 646 million of commercial papers
outstanding, in 2023 the Company did not have any commercial papers outstanding.
Loans due to related parties
Refer to the disclosure in Related parties note below for further analysis of loans due to related
parties.
13. Other liabilities
A
g
enc
y
Short-te rm Lon
g
ter
m
Outlook
Moody’s P-2 A3 Negative
Standard & Poor A-2 BBB+ Stable
A
g
enc
y
Short-te rm Lon
g
ter
m
Outlook
Moody’s P-2 A3 Stable
Standard & Poor A-2 BBB+ Stable
31 December 2023
31 December 2024
(in thousands of EUR)
31 December 2024 31 December 2023
Current other liabilities
Accrued liabilities 211 345
Lease liability (Note 5) 262 242
Accrued interest - 1
VAT 50 9
Total 523 597
(in thousands of EUR)
31 December 2024 31 December 2023
Non-current other liabilities
Lease liability (Note 5) 911 81
Total 911 81
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
47
14. Provisions
14.1 Loss allowance on undrawn loan commitments
The Company provides loan commitments to related parties. These commitments are on market
terms and even though the nominal contractual values of undrawn loan commitments are not
recognized in the statement of financial position, the Company is required to consider the credit
risk they contain. The nominal values of the undrawn loan commitments, together with the
corresponding ECL are disclosed below.
The Company applied the same credit default swap spread (CDS) to measure the ECL for all
amounts due from Group companies. The loss allowances were recognized in accordance with
Stage 1 of the Company’s ECL model at an amount equal to the 12-month ECL. The table above
shows the maximum exposure to credit risk.
A reconciliation of changes in outstanding exposures and corresponding allowance for ECL by
stage for undrawn loan commitments is, as follows:
(in thousands of EUR)
At 1 January 2023
137 271 408
Changes in ECL
(137) - (137)
Arising during the year
- 199 199
Utilized during the yea
r
- (208) (208)
Released during the year
- (63) (63)
At 31 December 2023
(0) 199 199
Changes in ECL
1 - 1
Arising during the year
- 152 152
Utilized during the yea
r
- (199) (199)
At 31 December 2024
1 152 153
Loss allowance on
undrawn loan
commitments
Other
provisions
Total
(in thousands of EUR)
Original
currency
Nominal amount ECL Nominal amount ECL
EUR 245 1 - -
245 1 - -
31 December 2023
Stage 1
31 December 2024
Stage 1
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
48
14.2 Other provisions
The outstanding other provisions mainly relates to employee gratuity.
15. Financial risk management
The Company’s activities expose it to a variety of financial risks. These include currency, interest
rate, credit, and liquidity risk. The Company’s overall risk management program focuses on the
unpredictability of financial markets and seeks to minimize potential adverse effects on the
Company’s financial performance. Risk management is carried out by the Company under the
treasury risk guidelines provided by VWAG Group Treasury. VWAG provides direction for
overall risk management, covering specific areas such as foreign exchange risk, interest rate risk,
credit risk, use of derivative financial instruments and non-derivative financial instruments, and
investment of excess liquidity.
Government authorities in a number of jurisdictions worldwide have conducted and are
continuing to conduct investigations of Volkswagen Group regarding findings of irregularities in
relation to exhaust emissions from diesel engines in certain Volkswagen Group vehicles. The
results of these and any future investigations, and criminal litigations, may have a material adverse
effect on Volkswagen Group's business, financial position, results of operations and reputation,
as well as the prices of its securities and its ability to make payments under its securities.
VIF’s commercial success largely depends on the financial health and the reputation of the
ultimate shareholder VWAG and due to the events, VIF may not succeed in obtaining funds for
financing requests in due time and to the extent necessary. In addition, because of the
investigation, VIF as an issuer may face risks arising from legal disputes from investors claiming
damages for alleged breaches of capital market laws.
Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market prices. The objective of market risk management is to
manage and control market risk exposures within acceptable parameters, while optimizing the
return. The Company uses derivatives to manage market risks.
Market risk comprises two types of risks in the Company’s operation: interest rate risk and
currency risk.
(in thousands of EUR)
Outstanding
exposure
ECL
Outstanding
exposure
ECL
At 1 January - - 24.688 137
New exposures 245 1 - -
Dissolutions - - (24.688) (137)
At 31 December 245 1 - -
2023
Stage 1
2024
Stage 1
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
49
Currency risk
Currency risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of
changes in foreign exchange rates relates primarily to its financial instruments (loans to related
parties and its related borrowings).
To avoid this risk, the loans to related parties are generally matched in currency terms to the
related funding (bonds or commercial papers). Any mismatch would typically be corrected via
swaps and/or forwards to achieve the matched basis.
In cases where the matching cannot be achieved completely, the Supervisory Board has set small
currency limits for individual currencies; policies are monitored and enforced. Consequently,
currency risk is relatively remote. In 2024 and 2023, the limits were not exceeded.
The main currencies and interest zones applicable are GBP and CNY. The significant foreign
currency balances included within financial instruments, to which the Company is exposed should
exchange rates fluctuate, are as follows (excluding the effect of derivatives used for hedging):
(in thousands of EUR)
CNY
GBP
JPY
HKD
Total
(in thousands of EUR)
CNY
GBP
Total
89.088
1.305.452
31 December 2024
397.432
964.849
192.415
1.340.555
1.156.574
Bonds in foreign currencies
Loans to re late d partie s in fore ign
currencies
95.347
1.494.398
31 December 2024
199.294
1.141.261
36.771
1.348.989
31 December 2023
31 December 2023
257.219
920.868
38.277
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
50
The key exchange rates applied in the Company accounts are as follows:
An analysis has been performed on the Company’s exposure to movements in foreign exchange
rates and its potential impact on profit and loss, and equity. This analysis assumes that all other
variables, in particular interest rates, remain constant.
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. The Company’s interest rate risk arises from
loans to related parties and borrowings.
Based on funding requests by related parties, VIF issues notes to investors matching the fixed or
variable interest requirement of the related parties. Bonds were issued with both fixed and variable
interest rates.
The following table indicates the composition of fixed versus variable rate bonds:
(in thousands of EUR)
CNY
GBP
JPY
HKD
(in thousands of EUR)
CNY
GBP
JPY
HKD
Borrowings in foreign currencies
Borrowings in foreign currencies
8,47
Average rate
0,83
0,87
151,97
7,87
0,87
8,08
Year-end rate
31 December 2023
7,66
31 December 2024
7,79
0,85
163,85
8,44
163,23
31 December 2024 31 December 2023
7,60
156,79
8,65
(in thousands of EUR)
Change in exchange rate
+10% -10% +10% -10%
EUR/CNY
73 (73) 6.493 (6.493)
Profit/loss after tax 54 (54) 4.818 (4.818)
EUR/GBP
(13.402) 13.402 (19.297) 19.297
Profit/loss after tax (9.944) 9.944 (14.318) 14.318
EUR/JPY
3.676 (3.676) 3.827 (3.827)
Profit/loss after tax 2.728 (2.728) 2.840 (2.840)
EUR/HKD
9.277 (9.277) 8.668 (8.668)
Profit/loss after tax 6.884 (6.884) 6.432 (6.432)
31 December 202331 December 2024
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
51
The variable rate bond is hedged with interest rate swaps to mitigate interest rate risk. There is a
floor of 0% applicable to the variable rate bond, however this bond has a positive spread above
the linked index rate (3M-EURIBOR) and based on prior year curves, the Company considers it
highly unlikely that the bond will be floored at 0%.
In cases where the investor looks for a different interest structure, VIF uses interest rate swaps or
cross-currency interest rate swaps to convert the interest into the structure required by the related
parties. The Supervisory Board authorised VIF to run a certain interest rate risk. A limit system
and tools to monitor and manage the risk have been set up. Interest mismatches are permitted
within a twelve-month period only. Therefore, the risk is relatively low. In 2024 and 2023, no
limits were exceeded.
The table below demonstrates the sensitivity of profit and loss, and equity to reasonably possible
changes in interest rates on that portion of bonds and related party loans affected, including the
impact of related derivatives. With all other variables held constant, the profit and loss, and equity
of the Company is affected through the impact on variable rate bonds, variable rate related party
loans and related derivative contracts, as follows:
Credit risk
Credit risk is the risk that a counterparty will not meet its payment obligations under a financial
instrument or customer contract, leading to a financial loss. The Company is exposed to credit
risk from loans extended to related parties and through entering into derivative contracts with
external banks.
Intercompany-related credit risk
VIF extends loans to related parties, which are granted according to the guidelines and instructions
from VWAG, the guarantor of commercial paper and capital market issuances by VIF. The default
risk of VIF-borrowers has been analysed based on financial reports, planning forecasts and
discussions with VWAG headquarters. Based on the analysis, the credit risk of VIF-borrowers is
considered to be remote.
Although the Company determined that there is a low risk of default on loans receivable, the
Company has recognized loss allowances in accordance with IFRS 9. Refer to notes 7 and 14 for
disclosure of the gross carrying amount of loans and undrawn loan commitments exposed to credit
risk and the related allowance for ECL recognized.
(in thousands of EUR)
31 December 2024 31 December 2023
Fixed rate bonds 31.884.043 33.445.926
Variable rate bonds 1.002.481 1.258.377
Total 32.886.524 34.704.303
(in thousands of EUR)
Change in interest rate
+100 bps -100bps +100 bps -100bps
Profit/loss after tax (22.093) 22.926 (29.148) 30.458
31 December 2024 31 December 2023
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
52
The Company establishes a three stage impairment model, based on whether there has been a
significant increase in the credit risk of a financial asset since its initial recognition. These three
stages then determine the amount of impairment to be recognized as expected credit losses (ECL),
as well as the amount of interest income to be recorded at each reporting date. Refer to Note 3
Significant accounting policies for a detailed description of how the Company applies staging in
measuring impairment.
The loss allowance is calculated as the product of PD, LGD and EAD. There are no external or
internal ratings available for the group-internal counterparties and therefore:
for loans receivables: the product of PD and LGD is determined by the CDS of VWAG;
and
for loan commitments: the product of PD and LGD is determined by the CDS of VWAG.
The EAD is the nominal amount of the commitment multiplied by a Credit Conversion
Factor (CCF).
If the CDS rate had increased or decreased by 10% the Company would have the following effects
on earnings after tax.
Cash and cash equivalents and cash-pool receivables
For VIF’s external bank counterparties risk is limited by a limit system centrally managed by
VWAG Group Treasury Risk Management taking into account also the credit assessments by the
international rating agencies. Credit risk with external counterparties materializes from account
balances, deposits and derivative transactions. Given the business purpose of VIF, account
balances and deposits are zero or kept to a minimum.
Derivative-related credit risk
Exposure is kept within the risk limits defined by VWAG Group Risk Management. In order to
mitigate credit risk associated with derivative contracts, the Company only executes derivatives
with counterparties that are highly rated and have entered into an ISDA Master Agreement in
which a set-off is agreed to in the event of default by either counterparty. Therefore, derivative-
related credit risk is represented only by the positive fair value of the instrument and is normally
a small fraction of the contract’s nominal amount. Settlement dates of derivatives are also directly
linked to the relevant payment dates of the interest and/or principal amounts of the related loans
and/or bonds. Credit risk and counterparty limit allocations are frequently monitored by Group
Treasury Risk Management.
(in thousands of EUR)
Change in CDS
+10% -10% +10% -10%
Profit/loss after tax (9.320) 9.320 (10.308) 10.308
31 December 2024 31 December 2023
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
53
Liquidity risk
Liquidity risk is the risk of having insufficient cash resources to meet current financial obligations
without raising funds at unfavourable rates or selling assets on a forced basis. The critical terms
of the Company’s assets and liabilities match. Management believes that the expected inflows
and outflows are aligned such that there is no liquidity risk.
The age analysis of undiscounted contractual cash flows from financial liabilities and assets are
as follows:
On demand
Less than 3
months
3 to 12
months
1 to 5 years Over 5 years Total
Financial ass e ts
Loans to related parties - 2.154.370 3.972.950 21.512.764 11.748.081 39.388.165
Trade and other receivables -
Cash-pool receivables -
- 2.154.370 3.972.950 21.512.764 11.748.081 39.388.165
Financial liabilities
Debt issued and other
borrowed funds:
Bonds - (1.171.843) (3.502.164) (21.447.299) (11.819.269) (37.940.575)
Commercial papers - (647.000) - - - (647.000)
Lease liabilities - - - - -
Trade and other payables - - - - -
- (1.818.843) (3.502.164) (21.447.299) (11.819.269) (38.587.575)
Gross se ttled derivatives
Financial ass e ts
Contractual amounts
rec eivable - - 76.329 683.650 - 759.979
Contractual amounts
payable - (1.332) (70.740) (653.721) - (725.793)
- (1.332) 5.589 29.929 - 34.186
Financial liabilities
Contractual amounts
rec eivable - 13. 373 402.252 522.018 900.444 1.838.087
Contractual amounts
payable - (17.486) (435.092) (560.592) (876.938) (1.890.108)
- (4.113) (32.840) (38.574) 23.506 (52.021)
Total gross settled
derivatives
- (5.445) (27.251) (8.645) 23.506 (17.835)
Total net financial asse ts
/ (liabilities )
- 330.082 443.535
56.820 (47.682) 782.755
31 December 2024
UNDISCOUNTED CASH FLOWS FOR REMAINING CONTRACTUAL MATURITY
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
54
The table below shows the contractual expiry by maturity of the Company’s undrawn loan
commitments. Each undrawn loan commitment is included in the time band containing the earliest
date it can be drawn down:
(in thousands of EUR)
On demand
Less than 3
months
3 to 12
months
1 to 5 years Over 5 years Total
Financial as se ts
Loans to related parties - 381.809 3.968.486 22.034.548 14.682.621 41.067.464
Trade and other receivables - - - - - -
Cash-pool receivables 736.930 - - - - 736.930
736.930 381.809 3.968.486 22.034.548 14.682.621 41.804.394
Financial liabilitie s
Debt issued and other borrowed funds:
Bonds - (378.632) (3.933.184) (21.898.533) (14.719.464) (40.929.813)
Loans from related parties - - - - - -
Le as e liabilitie s - - (242) (80) - (322)
Trade and other payables - (194) - - - (194)
-
(378.826) (3.933.426) (21.898.613) (14.719.464) (40.930.329)
Gross settled derivatives
Financial as se ts
Contractual amounts receivable - 31.282 71.628 501.082 327.376 931.368
Contractual amounts payable - (12.458) (62.948) (551.443) (333.071) (959.920)
- 18.824 8.680
(50.361)
(5.695) (28.552)
Financial liabilitie s
Contractual amounts receivable - 65.487 50.563 920.441 581.852 1.618.343
Contractual amounts payable - (72.583) (47.804) (917.158) (569.963) (1.607.508)
-
(7.096) 2.759 3.283 11.889 10.835
Total gross settled derivatives -
11.728 11.439 (47.078) 6.194
(17.717)
Total net financial assets / (liabilities) 736.930 14.711 46.499 88.857
(30.649)
856.348
31 December 2023
UNDISCOUNTED CASH FLOWS FOR REMAINING CONTRACTUAL MATURITY
(in thousands of EUR)
On demand
Less than 3
months
3 to 12
months
1 to 5 years Over 5 years Total
Continge nt liabilitie s and commitme nts
Undrawn loan commitments - 245 - - - 245
- 245 - - - 245
(in thousands of EUR)
On demand
Less than 3
months
3 to 12
months
1 to 5 years Over 5 years Total
Continge nt liabilitie s and commitme nts
Undrawn loan commitments - - - - - -
--- - - -
31 December 2023
UNDISCOUNTED CASH FLOWS FOR REMAINING CONTRACTUAL MATURITY
31 December 2024
UNDISCOUNTED CASH FLOWS FOR REMAINING CONTRACTUAL MATURITY
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
55
Based on funding requests by VWAG related parties, VIF issues commercial paper and bonds to
investors. Funds taken from investors are extended with the same maturity to VW Group
borrowers.
In cases where this matching cannot be achieved the Supervisory Board has set narrow liquidity
risk limits. The Company monitors the limits on a permanent basis. Against the background of
the relatively narrow limits and the strong financial solidity of the Volkswagen Group, the
liquidity risk is remote. In 2024 and 2023, no limits were exceeded. Notes issued by VIF have the
benefit of a Guarantee and Negative Pledge given by VWAG.
The Debt Issuance Program under which VIF is issuing is regularly updated to incorporate current
developments. VIF is able to continue the issuance of commercial paper based on the existing CP
Program to finance the requirements of Volkswagen group companies and joint ventures of the
Volkswagen group.
To ensure flexible refinancing possibilities, VWAG has arranged for uncommitted facilities with
related parties for general corporate purposes. The undrawn amounts of these borrowing facilities
which are available to VIF from related parties are presented in the following table:
Capital management
The Company manages its total equity (share capital and reserves) as capital. The Company’s
objectives when managing capital are:
To safeguard the Company’s ability to continue as a going concern, so that it can continue
to provide returns for shareholders and benefits for other stakeholders, while maintaining
an optimal capital structure to reduce the cost of capital.
To maintain sufficient financial resources to repay the nominal amounts of its debts and
other borrowed funds.
To ensure compliance with capital market requirements.
In order to maintain or adjust the capital structure, the Company may adjust the amount of
dividends paid to shareholders, return capital to shareholders or issue new shares.
The Company monitors capital on the basis of the following criteria:
Bond issuance fees are deducted upfront and sufficient cash reserves therefore needs to
be build up to bridge the difference between the proceeds received on bonds and the
nominal amounts that are payable upon maturity of the bonds. VIF incorporates the
(in thousands of EUR)
31 December 2024 31 December 2023
Original
currency
Nominal amount Nominal amount
Undrawn borrowing facilities
EUR
245 -
Undrawn borrowing facilities CZK 81 81
81 81
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
56
deducted amounts in the interest charged on related party loans, separated on each interest
payment day and accumulated over the lifetime of the loan as a cash reserve.
VIF was until the end of 2023 contractually required to maintain a minimum level of equity as a
reserve to fulfil its obligations under its back-to-back financing activities in accordance with its
Advanced Pricing Agreement (APA). This equity reserve amount was used to compensate any
losses on the positions taken. VIF has no longer an APA as of 31 December 2024 and therefore
no longer keeps this equity reserve amount.
The following table indicates the key indicators and equity levels used to manage and monitor the
Company’s capital:
There have been no breaches of financial covenants or capital market requirements during the
periods reported on. No changes were made in the objectives, policies and processes for
managing capital during the periods reported on.
16. Fair values
A number of the Company’s accounting policies and disclosures require the measurement of fair
values for financial instruments. The fair value of financial instruments is the price that would be
received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or
most advantageous) market at the measurement date under current market conditions (i.e., an exit
price) regardless of whether that price is directly observable or estimated using another valuation
technique.
The Company has an established control framework with respect to the measurement of fair
values for its financial instruments. When measuring the fair value of an asset or a liability, the
Company uses market observable data as far as possible. Fair values are categorized into different
levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows.
— Level 1: fair value of financial instruments for which a price is directly available in an active
market. Quoted prices (unadjusted) are used.
— Level 2: fair values determined based on observable inputs (either directly or indirectly) other
than quoted prices included in Level 1. For example, fair values determined using foreign
exchange rates or yield curves using market-based valuation techniques.
— Level 3: inputs for the asset or liability that are not based on observable market data
(unobservable inputs). Fair values are calculated using valuation techniques that incorporate
inputs that are not observable in active markets.
If the inputs used to measure the fair value of an asset or a liability might be categorized in
different levels of the fair value hierarchy, then the fair value measurement is categorized in its
(in thousands of EUR)
31 December 2024 31 December 2023
Equity reserve to be maintained by APA - 30.000
Cash reserves available to repay nominal bond amounts
123.370 94.978
Total equity 599.623 582.490
Total liabilities 33.5 76 .342 34.730.807
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
57
entirety in the same level of the fair value hierarchy as the lowest level input that is significant to
the entire measurement.
For assets and liabilities that are recognised in the financial statements at fair value on a recurring
basis, the Company determines whether transfers have occurred between levels in the hierarchy
by re-assessing categorization (based on the lowest level input that is significant to the fair value
measurement as a whole) at the end of each reporting period.
The following table shows the fair values of financial assets and financial liabilities. It does not
include fair value information for financial assets and financial liabilities not measured at fair
value if the carrying amount is a reasonable approximation of fair value.
(in thousands of EUR)
Carrying amount Level 1 Level 2 Level 3 Total
Financial assets measured at fair value
Derivative financial ins truments 21.224 - 21.224 - 21.224
Total 21.224 - 21.224 - 21.224
Financial assets not measured at fair value
Loans to related parties 34.012.264 - 34.607.121 - 34.607.121
Total 34.012.264 - 34.607.121 - 34.607.121
Financial liabilities measured at fair value
Derivative financial ins truments 34.113 - 34.113 - 34.113
Total 34.113 - 34.113 - 34.113
Financial liabilities not measured at fair value
Debts iss ued and other borrowed funds 33.532.385 29.648.542 1.967.061 - 31.615.603
Total 33.532.385 29.648.542 1.967.061 - 31.615.603
(in thousands of EUR)
Carrying amount Level 1 Level 2 Level 3 Total
Financial assets measured at fair value
Derivative financial ins truments 63.836 - 63.836 - 63.836
Total 63.836 - 63.836 - 63.836
Financial assets not measured at fair value
Loans to related parties 34.485.535 - 34.954.981 - 34.954.981
Total 34.485.535 - 34.954.981 - 34.954.981
Financial liabilities measured at fair value
Derivative financial ins truments 18.408 - 18.408 - 18.408
Total 18.408 - 18.408 - 18.408
Financial liabilities not measured at fair value
Debts iss ued and other borrowed funds 34.704.303 31.990.775 1.312.429 - 33.303.204
Total 34.704.303 31.990.775 1.312.429 - 33.303.204
Fair Value as of 31 December 2023
Fair Value as of 31 December 2024
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
58
Valuation techniques
Loans to/(from) related parties:
The fair values are determined using the discounted cash flow model. Because all loans are
granted to companies and affiliates of the Volkswagen Group, the fair value calculation takes into
account the credit default swap rate of the VWAG traded in the financial markets retrieved from
Reuters. The country risk premium is based on the country in which the counterparty is located.
Derivative financial instruments:
Interest rate derivatives include interest rate swaps and cross-currency interest rate swaps. These
are valued using present value calculations by estimating future cash flows and discounting them
with the appropriate yield curves incorporating funding costs relevant for the position. These
contracts are generally Level 2 unless adjustments to yield curves or credit spreads are based on
significant non-observable inputs, in which case, they are Level 3.
Foreign exchange contracts include open spot contracts, foreign exchange forward and swap
contracts and over the-counter foreign exchange options. These instruments are valued by either
observable foreign exchange rates, observable or calculated forward points and option valuation
models. With the exception of contracts where a directly observable rate is available which are
disclosed as Level 1, the Company classifies foreign exchange contracts as Level 2 financial
instruments when no unobservable inputs are used for their valuation or the unobservable inputs
used are not significant to the measurement (as a whole).
Debts issued and other borrowed funds:
The market values for the bonds are based on the prices of the Stuttgart stock exchange. In case
of non-availability, the market values are determined on the basis of discounted cash flows. Credit
spreads were not included in the model used to determine the market value.
The Company recognizes transfers between levels of the fair value hierarchy at the end of the
reporting period during which the change has occurred.
17. Net interest income
Interest income
(in thousands of EUR)
2024 2023
Interest income calculated using the effective interest method
Loans to related parties 1.320.849 1.212.713
1.320.849 1.212.713
Other interest and similar income
Interest income earned on derivative financial instruments 144.665 147.931
Other Interest income 9.265 21.848
153.930 169.779
Total 1.474.779 1.382.492
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
59
Interest expenses
18. Fees and commission income
(in thousands of EUR)
2024 2023
Interest expense calculated using the effective interest method
Bonds interest expense 1.264.684 1.189.177
Commercial papers interest expense 13.106 -
Interest accrued on loans from related parties - 1
1.277.790 1.189.178
Other interest and similar expense
Interest expense on derivative financial instruments 128.002 128.429
Direct fees from issuances 795 203
Interest expense on lease liabilities (Note 5) 23 13
Guarantee commission on bond 1.212 1.498
Depository facility fee - -
130.032 130.143
Total 1.407.822 1.319.321
(in thousands of EUR)
2024 2023
F
ee income recognized over time in respect of services to:
Volkswagen Financial Services N.V. 1.210 1.450
Volkswagen Finance Overseas B.V. 228 150
Volkswagen Finance Europe B.V. 234 88
1.672 1.688
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
60
19. Change in allowance for expected credit losses on financial assets and
loan commitments
20. Net gains/(losses) on derivatives
P&L
(in thousands of EUR)
Stage 1 Stage 2 Stage 3 Total
Loans to related parties
13.309 - - 13.309
Undrawn loan commitments
(1) - - (1)
Total change in ECL
13.308 - -
13.308
(in thousands of EUR)
Stage 1 Stage 2 Stage 3 Total
Loans to related parties
104.347 - - 104.347
Undrawn loan commitments
137 - - 137
Total change in ECL
104.484 - -
104.484
2023
2024
Ne t gain/(loss) on derivative financial instrume nts
(in thousands of EUR)
2024 2023
Realized FX losses on derivatives
(2.074) (5.687)
Unrealized FX losses on derivatives
(4) -
Realized FX gains on derivatives
176 18.148
Unrealized FX gains on derivatives
4 613
Fair value losses on derivatives
(104.739) (23.716)
Fair value gains on derivatives
52.847 (33.752)
Total
(53.790) (44.394)
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
61
21. Net gains/(losses) on financial instruments measured at amortized cost
22. Other operating income
(in thousands of EUR)
2024 2023
Gain / (loss) on financial assets at amortized cost:
Realized FX losses on loans to related parties
(1.358) (20.278)
Unrealized FX losses on loans to related parties
(1.191) (3.839)
Realized FX gains on loans to related parties
3.491 7.211
Unrealized FX gains on loans to related parties
57.526 38.180
58.468 21.274
Gain / (loss) on financial liabilities at amortized cost:
Realized FX losses on bonds
(286) (9.508)
Unrealized FX losses on bonds
(62.793) (18.277)
Realized FX gains on bonds
196 6.261
Unrealized FX gains on bonds
1.509 20.243
Realized FX losses on loans to related parties
- (3)
Realized FX gains on loans to related parties
6 -
Unrealized FX gains on loans to related parties
- 1
(61.368) (1.283)
Total
(2.900) 19.991
(in thousands of EUR)
2024 2023
Rental income
55 63
Other income
12 42
Total
67 104
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
62
23. Personnel expenses
The Company has a defined contribution pension plan that is re-insured with an insurance
company. The premium payable during the financial year is charged to the result.
In 2024, the average number of employees calculated on a full-time-equivalent basis was 11,5
(2023: 14), of which 1 is a key management employee (2023: 1). There were no employees
working abroad.
24. Other operating expenses
The following fees based on invoices and estimated work orders for assurance services incurred
in the reported year:
The audits of the statutory accounts in 2024 and 2023 were performed by EY Accountants B.V.
and these statutory accounts were prepared in accordance with IFRS.
The other audit procedures in 2024 and 2023 comprise the consent letters issued by EY
Accountants B.V, and the audit of the special purpose financial statements, performed by Ernst
& Young Hua Ming LLP, required by the Debt Financing Instruments (DFI) program in China,
regulated by the National Association of Financial Market Institutional Investors (NAFMII).
The other non-audit services in 2024 and 2023 are related to the review of the quarterly group
reporting package and were performed by EY Accountants B.V.
(in thousands of EUR)
2024 2023
Salaries and social security charges
1.416 1.546
Pension cost - defined contribution plan 296 304
Total 1.712 1.850
(in thousands of EUR)
2024 2023
Audit and advisory costs 143 255
Other general administrative expenses 1.074 917
Total 1.217 1.172
(in thousands of EUR)
2024 2023
Audit of the financial statements 93 90
Other audit procedures 70 117
Other non-audit services 32 48
Total 195 255
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
63
Neither tax services nor other non-audit services were rendered by EY Accountants B.V The fees
disclosed represent the expenses incurred in relation to the audit of the year of the respective
financial statements as opposed to when the fees were incurred.
25. Income taxes
Global minimum top-up tax
On 19 December 2023, the government of the Netherlands enacted the Pillar Two income taxes
legislation effective from 1 January 2024.
Based on the most recent available Country-by-Country Reporting (CbCR) data of the
Volkswagen Group for the Netherlands, VIF would have been able to make use of the transitional
CbCR-safe harbour tests of the Pillar Two legislation. VIF does not expect a material exposure to
Pillar Two income taxes. For 2025 the Volkswagen Group will continue to monitor the impact of
the Pillar Two legislation.
Amounts recognized in the statement of profit or loss and other comprehensive
income
Deferred taxes as at 31 December 2024 are calculated at 25,8% (2023: 25,8%).
The exception introduced in May 2023 with the amendments to IAS 12 means that deferred taxes
in connection with income taxes resulting from applicable or announced tax provisions
implementing the Pillar Two model rules are neither recognized nor disclosed at VIF.
(in thousands of EUR)
2024 2023
Curre nt tax
Current tax on profits for the year (18.004) (15.900)
Adjustments in respect of prior years 1.295 -
Total current tax (16.709) (15.900)
De fe rre d tax
Origination and reversal of temporary differences 11.779 (20.652)
Total de fe rre d tax 11.779 (20.652)
Income tax (expense) benefit (4.930) (36.552)
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
64
Reconciliation of effective tax rate
The reconciliation of the weighted average statutory income tax rate to the effective income tax
rate is as follows:
Movement in deferred tax balances
(in thousands of EUR)
2024 2023
Profit (loss) before taxation 22.063 141.685
Tax (expense) / benefit at weighted-
average statutory rate
(5.692)
25,800%
(36.555)
25,800%
Tax effects of:
Withholding tax paid (723) -
Withholding tax expense 187 -
Non-deductible expenses - (3)
Adjustment to prior years
1.285 (7)
Basic tax rate 19 % (2023: 19 %) 14 13
Income tax (expense) benefit (4.930) 22,346% (36.552) 25,798%
(in thousands of EUR)
Net balance
at 1 January
2024
Net balance
De fe rre d
tax assets
De fe rre d tax
liabilitie s
Property, plant and equipment (80) (217) (297) - (297)
Leases 83 219 302 302 -
Impairment allowance for loans to related parties
35.841 (3.434) 32.407 32.407 -
Derivative financial instruments (9.404) 15.211 5.807 7.759 (1.952)
Total 26.440 11.779 38.219 40.468 (2.249)
(Charged) /
Credited
through the
statement of
profit and los s
Balance at 31 December 2024
(in thousands of EUR)
Net balance
at 1 January
2023
Net balance
De fe rre d
tax assets
De fe rre d tax
liabilitie s
Property, plant and equipment (119) 39 (80) - (80)
Leases 122 (39) 83 83 -
Impairment allowance for loans to related parties
62.762 (26.921) 35.841 35.841 -
Impairment allowance for undrawn loan
commitments
35 (35) - - -
Derivative financial instruments (15.708) 6.304 (9.404) 108.150 (117.554)
Total 47.093 (20.652) 26.440 144.074 (117.634)
Balance at 31 December 2023
(Charged) /
Credited
through the
statement of
profit and los s
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
65
26. Related parties
Identification of related parties
Related parties and enterprises, as defined by IAS 24, are parties and enterprises which can be
influenced by the reporting company or which can influence the reporting company. In addition,
statutory directors, other key management of the Company or the ultimate parent company and
close relatives are regarded as related parties.
Transactions between related parties have taken place at an arm’s length basis and include
rendering or receiving of services.
Loans with related parties
The Company, a wholly owned subsidiary of VFL, provides related parties with unsecured
intercompany loans. Loans are issued with both variable and fixed interest rates. The full principal
of the loan is due at maturity. There are no guarantees given by the parent or ultimate parent for
these loans. All loan to related parties are with affiliated entities of Volkswagen Group.
Loans receivable
Loan receivable balances outstanding with related parties are shown in the following table:
(
in thousands o
f
EUR
)
O riginal
currency
31 December 2024 31 December 2023
Loans receivable
Volkswagen AG
EUR
25.754.295 27.764.751
Volkswagen Financial Services Overseas AG EUR - 1.792.373
Volkswagen Leasing GmbH
EUR
3.087.903 3.584.579
Vo lkswagen F inancial Services AG EUR 1.792.821 -
Vo lkswagen F inancial Services (UK ) Ltd.
GBP
1.137.049 1.086.259
Volkswagen Finance China Co., Ltd.
CNY
198.751 191.607
Volkswagen International Luxemburg S.A.
GBP
65.749
Volkswagen International Luxemburg S.A.
EUR
704.971
Volkswagen Group Charging CZ
CZK
-217
Volkswagen Renting S.A. EUR 64 6. 52 0 -
TRATON Treasury AB, Södertälje SEK 191.825 -
TRATON Finance Luxemburg S.A. CZK 498.128 -
Total 34.012.264 34.485.535
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
66
The following table provides the movement schedule of the loans granted:
Loans payable
The Company had no loan payable balances with related parties in 2024 and 2023.
The following table provides the movement schedule of the loans taken:
Cash-pool receivable
As of 31 December 2024, the Company had a cash pool balance with Volkswagen International
Belgium N.V.
Further details are disclosed in note 10.
(in thousands of EUR)
31 December 2024 31 December 2023
Loans receivable
Beginning of the period 34.485.535 33.849.988
Loans advance
d
2.898.360 4.273.354
Loan repayments received (3.442.095) (3.868.687)
Interest accrued 619.651 620.928
Interest received (620.928) (515.444)
Foreign exchange movements 58.431 21.051
Movements in ECL 13.309 104.346
End of the
p
eriod 34.012.264 34.485.535
(in thousands of EUR)
31 December 2024 31 December 2023
Loans
p
a
y
able
Beginning of the period - 87
Proceeds from loans - -
Loan repayments - (83)
Interest accrued - -
Interest paid - (4)
Foreign exchange movements - -
End of the pe riod - -
(in thousands of EUR)
31 December 2024 31 December 2023
Cash-pool receivables 101.222 736.930
Total 101.222 736.930
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
67
Other transactions
Commission fee
The service fees, as disclosed in note 18, constitute compensation for the use of VIF’s
infrastructure and staff under service agreements with related parties.
Guarantee fee
The guarantee commission, as disclosed in note 17, is charged by Volkswagen AG for
guaranteeing due payment of the amounts corresponding to the principal and interest to the holder
of notes issued by VIF.
Key management personnel compensation
In line with the exemption provided in article 2:383 of the Dutch civil code, no information is
disclosed with respect to the remuneration of the management.
The members of the Supervisory Board did not receive any remuneration in the relevant reporting
periods.
27. Subsequent events
No subsequent events that require disclosure nor adjustment have occurred.
28. Going concern
The Managing Director has made an assessment of the Company’s ability to continue as a going
concern and is satisfied that the Company has the resources and activities to continue in business
for the foreseeable future. Furthermore, the Managing Director is not aware of any material
uncertainties that may cast significant doubt upon the Company’s ability to continue as a going
concern. Therefore, the financial statements continue to be prepared on the going concern basis.
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
68
Responsibility Statement
To the best of our knowledge, and in accordance with the applicable reporting principles, the
financial statements give a true and fair view of the assets, liabilities, financial positions and profit
or loss of the company, and the management report includes a fair review of the development and
performance of the business and the position of the company, together with a description of the
material opportunities and risks associated with the expected development of the company.
Amsterdam, 10 March 2025
Volkswagen International Finance N.V.
The Management Board
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
69
Signing of the Annual Report
Amsterdam, 10 March 2025
Management Board, Supervisory Board,
Original has been signed by Original has been signed by
C. Norrod B. Bätge
Original has been signed by
Dr. M. Hellmann
Original has been signed by
B. Reinecke
VOLKSWAGEN INTERNATIONAL FINANCE N.V.
ANNUAL REPORT
70
Other information
Profit appropriation according to the Articles of Association
The Company’s Articles of Association provide that appropriation of accrued profit is subject to
the decision of the shareholders at the general meeting of shareholders. The Company can only
make distributions to the shareholders and other persons entitled up to an amount, which does not
exceed the amount of the distributable reserves. The general meeting may resolve to pay dividends
from legally distributable reserves.
Independent auditor’s report
To: the shareholder and supervisory board of Volkswagen International Finance N.V.
Report on the audit of the financial statements 2024
included in the annual report
Our opinion
We have audited the accompanying financial statements for the financial year ended 31 December 2024
of Volkswagen International Finance N.V. based in Amsterdam, the Netherlands.
In our opinion the financial statements give a true and fair view of the financial position of Volkswagen
International Finance N.V. as at 31 December 2024 and of its result and its cash flows for 2024
in accordance with International Financial Reporting Standards as adopted in the European Union
(EU-IFRSs) and with Part 9 of Book 2 of the Dutch Civil Code.
The financial statements comprise:
The statement of financial position as at 31 December 2024
The following statements for 2024: the statements of income and comprehensive income, changes in
equity and cash flows
The notes comprising material accounting policy information and other explanatory information
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our
responsibilities under those standards are further described in the Our responsibilities for the audit of
the financial statements section of our report.
We are independent of Volkswagen International Finance N.V. (the company) in accordance with the
EU Regulation on specific requirements regarding statutory audit of public-interest entities,
the Wet toezicht accountantsorganisaties (Wta, Audit firms supervision act), the Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence regulations in
the Netherlands. Furthermore we have complied with the Verordening gedrags- en beroepsregels
accountants (VGBA, Dutch Code of Ethics for professional accountants).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
71
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole and
in forming our opinion thereon. The following information in support of our opinion and any findings
were addressed in this context, and we do not provide a separate opinion or conclusion on these matters.
Our understanding of the business
Volkswagen International Finance N.V. is incorporated as a wholly-owned subsidiary of Volkswagen
Finance Luxemburg S.A., who in turn is a 100% subsidiary of Volkswagen AG (“VWAG”). The main
purpose of the Company is to assist VWAG in raising funds and on-lending money to companies within the
Volkswagen group. VWAG’s main activities are development, production and sale of vehicles and other
vehicle related products and services. The main income of Volkswagen International Finance N.V. is the
interest income on the loans issued to related parties.
We paid specific attention in our audit to a number of areas driven by the operations of the company and
our risk assessment.
We determined materiality and identified and assessed the risks of material misstatement of the financial
statements, whether due to fraud or error in order to design audit procedures responsive to those risks
and to obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
Materiality
Materiality €273 million (2022: €283 million)
Benchmark applied 0.8% of total assets as at 31 December 2024
Explanation We determined materiality based on our understanding of the
company’s business and our perception of the financial information
needs of users of the financial statements. We considered that total
assets reflect the source of income and repayments to the holders of
the bonds and the commercial papers issued by the company.
We determined materiality consistent with prior financial year.
We have also taken into account misstatements and/or possible misstatements that in our opinion are
material for the users of the financial statements for qualitative reasons.
We agreed with the supervisory board that misstatements in excess of €13.6 million, which are identified
during the audit, would be reported to them, as well as smaller misstatements that in our view must be
reported on qualitative grounds.
Teaming and use of specialists
We ensured that the audit team included the appropriate skills and competences which are needed for
the audit of a listed finance company. We have made use of specialists in the area of income taxes
including transfer pricing.
72
Our focus on fraud and non-compliance with laws and regulations
Our responsibility
Although we are not responsible for preventing fraud or non-compliance and we cannot be expected to
detect non-compliance with all laws and regulations, it is our responsibility to obtain reasonable
assurance that the financial statements, taken as a whole, are free from material misstatement, whether
caused by fraud or error. The risk of not detecting a material misstatement resulting from fraud is higher
than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override