Financial income and expenses

12 Months Ended

Dec. 31, 2022

Text Block [Abstract]

Financial income and expenses

7. Financial income and expenses

	2022 $m			2021 $m		2020 $m
Financial income
Financial income on deposits and money market funds		17			2		2
Interest income on loans and other assets		5			6		2
		22			8		4
Financial expenses
Interest expense on external borrowings		92			109		102
Interest expense on lease liabilities		29			29		37
Capitalised interest		–			–		(1	)
Unwind of discount on deferred purchase consideration		–			1		1
Foreign exchange gains		(10	)		–		–
Other charges		7			8		5
		118			147		144
Analysed as:
Financial expenses before exceptional items		118			147		130
Exceptional financial expenses (note 6)		–			–		14
		118			147		144

Financial income comprises $12m (2021: $8m, 2020: $4m) relating to financial assets held at amortised cost and $10m (2021: $nil, 2020: $nil) relating to assets held at FVTPL.

Interest expense on external borrowings and unwind of discount on deferred purchase consideration relate to financial liabilities which are held at amortised cost. Other charges includes bank charges and non-bank interest expense.

In 2022, $15m (2021: $1m, 2020: $3m) was payable to the IHG One Rewards loyalty programme relating to interest on the accumulated balance of cash received in advance of the consumption of points awarded. The expense and corresponding System Fund interest income are eliminated within financial expenses. On a net basis, financial income and expenses includes $1m (2021: $2m, 2020: $nil) of other interest which is also attributable to the System Fund.

Net interest payable as calculated for bank covenants can be found on page 201.