12. Financial income/(expense) - €(2,813)million

Financial income

Millions of euro     
 2013 2012 restated Change 
Total interest and other income from financial assets (current and non-current):         
- interest income at effective rate on non-current securities and receivables  56  49  14.3% 
- financial income on non-current securities at fair value through profit or loss  - -
- interest income at effective rate on short-term financial investments  293  284  3.2% 
Total interest and other income from financial assets  351  335  16  4.8% 
Foreign exchange gains  847  640  207  32.3% 
Income from derivative instruments:         
- income from cash flow hedge derivatives  232  218  14  6.4% 
- income from derivatives at fair value through profit or loss  455  273  182  66.7% 
- income from fair value hedge derivatives  70  34  36  105.9% 
Total income from derivative instruments  757  525  232  44.2% 
Income from equity investments  86  218  (132)  -60.6% 
Other income  412  467  (55)  -11.8% 
TOTAL FINANCIAL INCOME  2,453  2,185  268  12.3% 

Financial income amounted to €2,453 million, an increase of €268 million compared with the previous year.

“Income from derivative instruments” came to €757 million, of which €362 million realized (€380 million in 2012) and €395 million unrealized (€145 million in 2012).

The increase in foreign exchange gains mainly reflects the positive impact of exchange rate changes on debt denominated in currencies other than the euro.

“Income from equity investments” for 2013 came to €86 million, mainly in respect of the gains on the disposals of Medgaz (€64 million) and Endesa Gas T&D (€12 million). In 2012, the item included the proceeds from the disposal of the stake in Terna (€185 million).

“Other income” for 2013 include financial income in the total amount of €103 million (€180 million in 2012) recognized as an increase in the financial assets recognized in application of IFRIC 12 in Brazil following the entry into force of the Medida Provisória 579/2012. The item also includes €43 million in interest paid to Edesur in Argentina on the government grant to that company under the provisions of Resolución 250/2013.

Financial expense

Millions of euro     
 2013 2012 restated Change 
Interest expense and other charges on financial debt (current and non-current):         
- interest expense on bank loans  536  577  (41)  -7.1% 
- interest on bonds  2,170  2,206  (36)  -1.6% 
- interest expense on other loans  111  149  (38)  -25.5% 
- financial expense on securities at fair value through profit or loss - - - -
- commissions on unused lines of credit  66  38  28  73.7% 
Total interest expense and other charges on financial debt  2,883  2,970  (87)  -2.9% 
Foreign exchange losses  583  573  10  1.7% 
Expense on derivative instruments:         
- expense on cash flow hedge derivatives  812  491  321  65.4% 
- expense on derivatives at fair value through profit or loss  397  269  128  47.6% 
- expense on fair value hedge derivatives  17  (8)  -47.1% 
Total expense on derivative instruments  1,218  777  441  56.8% 
Accretion of post-employment and other employee benefits  163  281  (118)  -42.0% 
Accretion of other provisions  203  259  (56)  -21.6% 
Charges on equity investments  12  (5)  -41.7% 
Other charges  209  325  (116)  -35.7% 
TOTAL FINANCIAL EXPENSE  5,266  5,197  69  1.3% 

Financial expense totaled €5,266 million, up €69 million compared with 2012.

More specifically, the decrease in “interest expense and other charges on financial debt” is mainly attributable to the generalized decline in interest rates compared with 2012, as well as the debt refinancing strategy to optimize the financial structure and lengthen the average maturity of the debt of the Group.

“Expense on derivative instruments” came to €1,218 million, of which €521 million in realized charges (€534 million in 2012) and €697 million in unrealized charges (€243 million in 2012).

Expense from accretion, with regard to both employee benefits and other provisions, decreased by a total of €174 million, largely due to the reduction of the provisions themselves, as well as of the discount rates used in the measurement of the provisions.

Other charges for 2013 amounted to €209 million (€325 million in 2012), and reflect the positive impact of €66 million from the writeback of the value of the receivable due from the Slovakian National Nuclear Fund.