XXXII. Financial income and expense

(k)  20152014Change
Interest income 823 1,116 (293)
Interest differential on exchange rate hedges - 74 (74)
Ineffective portion of hedging instruments 24 111 (87)
Other financial income 1,011 802 209
Total financial income 1,858 2,103 (245)
(k)  20152014Change
Interest expense 31,555 37,055 (5,500)
Discounting of long-term liabilities 1,342 2,451 (1,109)
Exchange rate losses 3,849 2,411 1,438
Interest differential on exchange rate hedges 241 - 241
Fees paid on loans and bonds 1,475 144 1,331
Other financial expense 1,322 4,435 (3,113)
Total financial expense 39,784 46,496 (6,712)
Total net financial expense (37,926) (44,393) 6,467

The reduction in interest expense reflects the decrease in the average cost of debt, due to both interest rate trends in the market and the conditions on new loans taken out during the year. The 2015 figure includes € 1,332k in banking fees not yet fully amortized on the € 500m loan that was paid back early in March 2015.