Annual Report 2019

219 Transport International Holdings Limited 2019 Annual Report Notes to the Financial Statements 29 Capital and reserves (continued) (d) Capital management (continued) The Group monitors its capital structure on the basis of an adjusted net debt-to-capital ratio. For this purpose, the Group defines adjusted net debt as bank deposits and cash and restricted bank deposits less interest-bearing loans and borrowings and lease liabilities in the consolidated statement of financial position. Capital comprises all components of equity. The Group has initially applied HKFRS 16 using the modified retrospective approach. Under this approach, the Group recognises right-of-use assets and corresponding lease liabilities for almost all leases previously accounted for as operating leases as from 1 January 2019. This caused an increase in the Group’s total debt when compared to its position as at 31 December 2018. The Group’s adjusted net debt-to-capital ratio at the end of the current and previous reporting periods and at the date of transition to HKFRS 16 was as follows: 31 December 2019 1 January 2019 31 December 2018 (Note) (Note) Note $’ 000 $’ 000 $’ 000 Current liabilities: Lease liabilities 26 3,907 3,122 – Non-current liabilities: Bank loans 23 2,706,572 2,625,039 2,625,039 Lease liabilities 26 3,111 3,830 – Total debt 2,713,590 2,631,991 2,625,039 Less: Bank deposits and cash 22(a) (1,308,958) (1,174,249) (1,174,249) Restricted bank deposits 22(a) (146,955) (6,803) (6,803) Adjusted net debt 1,257,677 1,450,939 1,443,987 Capital 10,971,710 10,195,564 10,195,564 Adjusted net debt-to-capital ratio 11.5% 14.2% 14.2% Note: The Group has initially applied HKFRS 16 using the modified retrospective approach and adjusted the opening balances at 1 January 2019 to recognise lease liabilities relating to leases which were previously classified as operating leases under HKAS 17. Under this approach, the comparative information is not restated. See note 1(c). Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.