24. Cash and Cash Equivalents

Cash at banks bears interest at variable rates set according to the short-term interbank interest rates. Short-term deposits are placed for various periods, ranging from one day to one month, depending on the Group’s current demand for cash, and bear interest at the interest rates set for them.

As at December 31st 2008, the amount of undrawn funds available to the Group under working capital loans in respect of which all conditions precedent had been fulfilled was PLN 832,128 thousand (PLN 1,098,762 thousand as at December 31st 2007) (including the loan for refinancing and financing Grupa LOTOS S.A.’s inventory, granted by Bank Consortium (1) and working capital loan contracted with Bank Consortium (4); see Note 30).

As at December 31st 2008, restricted cash amounted to PLN 84,160 thousand (PLN 17,296 thousand as at December 31st 2007). Restricted cash was held mainly by the Parent Undertaking and included:

• a deposit of PLN 31,440 thousand, serving as security for the repayment of interest on the loan contracted to finance inventories,
• a margin of PLN 7,263 thousand,
• a deposit of PLN 1,502 thousand, serving as security for the benefit of the Customs Office in Pruszków,
• funds of PLN 29,904 thousand, held in the account dedicated to  payments made in connection with the investment projects under the 10+ Programme,
• funds of PLN 11,961 thousand, held in the account dedicated to repayments of principal amounts of and interest on the loans/credit facilities contracted to finance the implementation of the 10+ Programme.

Restricted cash is disclosed in the balance sheet under “Cash in hand and cash at banks” and “Other cash“.

As at December 31st 2008, cash in bank accounts serving as security for the repayment of Grupa LOTOS S.A.’s liabilities amounted to PLN 71,363 thousand (PLN 13,730 thousand as at December 31st 2007).