[14] Financial expenses

Financial expenses break down as follows:

Financial expenses

in € million

2020

2019

Interest expense from loans1

7.7

18.0

Interest expense from promissory notes1

22.0

18.3

Interest expense from bonds1

2.5

Interest expense from lease and short-term rental business1

53.3

57.6

Interest expense from procurement leases

14.1

15.3

Net interest expense from defined benefit plans and similar obligations

13.4

19.9

Foreign currency exchange rate losses (financing)

60.2

56.1

Changes in fair value of interest rate derivatives (without hedge relationship)

8.8

2.3

Other interest expenses and similar charges

20.0

13.1

Total financial expenses

201.9

200.6

1

Interest expense including amortization of finance costs

Financial expenses in 2020 were virtually unchanged compared with the prior year.

Interest expense from loans fell due to the adjustments to the funding structure in 2020 and 2019.

Interest expense from the leasing and short-term rental businesses, which totaled €53.3 million (2019: €57.6 million), was attributable both to liabilities from financing the direct and indirect leasing business and to liabilities from financing the short-term rental fleet. Leases entered into with customers in connection with these financing transactions and that constitute an operating lease relationship, together with the financing of the short-term rental fleet, resulted in interest expense of €22.5 million (2019: €23.3 million). The income from corresponding customer leases and short-term rental agreements is a component of the lease and rental payments received and is therefore reported within revenue rather than as interest income.

The decline in net interest expense from defined benefit plans and similar obligations is attributable to the fall in interest rates.

Foreign currency exchange rate expenses predominantly arise in connection with foreign currency positions in internal financing and the related hedging transactions that are not part of a formally documented hedge.

Other interest expenses and similar charges included commitment fees and transaction costs of €7.7 million in connection with the syndicated liquidity line that was agreed in 2020 in order to temporarily secure liquidity but not utilized.