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ePaper created 2012-04-20, 15:08:32 | version 1.23.0
73 Münchener Hypothekenbank eG notes OTHER OBLIGATIONS The irrevocable loan commitments contained in this item consist almost solely of mortgage loan commitments made to cus- tomers. It is anticipated that the irrevocable loan commitments will be drawn down. Against the background of the ongoing monitoring of loans, the probable need to create provisions for risks related to the remaining obligations is viewed as minor. A retrospective obligation pursuant to Art. 3 (3) of the Restructuring Fund Regulation in the amount of € 4,398 (thousand) is not shown under other financial liabilities in the balance sheet. NET EXPENSES OF TRADING Book The Bank’s future transactions are carried in the trading book. The results of these transactions are netted and shown in the net expenses of the trading book. OTHER OPERATING EXPENSES This position contains expenses arising from accrued interest effects of € 1,703 (thousands) (previous year € 1,992 (thousands)) for established provisions. Forward trades AND DERIVATIVES The following derivative transactions were made to hedge swings in interest rates or hedge against exchange rate risks. These figures do not include derivatives embedded in underlying basic transactions stated on the balance sheet. Nominal amounts (in millions of €) Residual term ≤ one year Residual term > one year ≤ five years Residual term > five years Total Fair value at date of record *) neg. (-) Interest-Rate-Related Transactions Interest rate swaps 8,254 22,563 25,139 55,956 -1,474 Interest rate options - Calls 21 145 74 240 11 - Puts 21 80 15 116 -5 Other interest rate contracts 60 50 230 340 0 Currency-Related Transactions Cross-currency swaps 1,617 528 1,589 3,734 29 *) Valuation methods: Interest rate swaps are valued using the present value method based on the current interest rate curve on the date of record. In doing so the cash flows are discounted using market interest rates appropriate for the related risks and remaining terms to maturity, interest that has been accrued but not yet paid is not taken into consideration. This approach is known as “clean price” valuation. The value of options is calculated using option price models and generally accepted basic assumptions. In general, the particular value of an option is calculated using the price of the underlying value, its volatility, the agreed strike price, a risk-free interest rate, and the remaining term to the expiration date of the option. The derivative financial instruments noted involve premiums stemming from option trades in the amount of € 1.9 million (previous year € 1.8 million) which are carried under the balance sheet item “Other assets”.