Notes
GENERAL
FGH Bank N.V. is an associated company of HVB Real Estate
Bank AG, which is part of Bayerische HypoVereinsbank AG,
which is registered in Munich.
These financial statements have been prepared in
accordance with the provisions laid down in Chapter 14 of
Part 9, Book 2 of the Netherlands Civil Code, the Decree
on the Annual Accounts of Banks, the Annual Accounts
Formats Decree, and relevant recommendations by
De Nederlandsche Bank N.V.
The company's financial statements are incorporated in the
published financial statements of FTVB Real Estate Bank AG,
Munich. A copy of these financial statements is available
at the company's registered office.
All figures are expressed in thousands of euros, unless
otherwise stated.
BASIS FOR THE RECOGNITION OF FINANCIAL INSTRUMENTS
IN THE BALANCE SHEET
A financial instrument is accounted for as an asset or
liability from the time the respective contractual rights or
obligations relating to the financial instrument accrue to the
company. Whenever this ceases to be the case, a financial
instrument is no longer recognized in the balance sheet.
If FGH Bank N.V. has the right, on the grounds of statutory
or contractual provisions, and the intention to settle these
financial assets and liabilities net or simultaneously, they
are netted off in the balance sheet.
BASIS OF CONSOLIDATION
The group financial statements include the figures for
FGH Bank N.V., its subsidiaries and associated companies,
but do not include the results of those companies which
together only make a very minor contribution to the
overall result, nor do they include the results of those
companies the interests in which are only held with a view
to disposal.
Participating interests regarded as joint ventures have been
consolidated on a pro rata basis, where the joint ventures in
question are financial institutions. Other joint ventures
have been included in the group financial statements as
participating interests. The income from non-consolidated
participating interests has been included under 'Income from
securities and participating interests'.
VALUATION AND DETERMINATION OF RESULTS
GENERAL
Except where otherwise stated, assets and liabilities are
recorded at nominal value, less any reduction in value
deemed necessary. In general, these reductions in value are
determined by item. Premiums and discounts are included
in prepayments and accrued income or accruals and deferred
income, respectively, and are attributed to accounting
periods based upon the residual term of the items concerned.
The effects of transactions and other events are recognized
when they occur; income and expenses are recognized in the
financial year to which they relate.
In general, commission income and expense resulting from
lending and borrowing operations is shown in the income
statement of the year in which the funds were lent or
borrowed, respectively. Commission that is similar in nature
to interest is shown in the income statement during the
term of the item in question. Other revenue is shown in the
year of receipt.
Where financial instruments are used to hedge the risks
associated with particular assets or liabilities, valuation and
determination of the results on these instruments are carried
out in accordance with the policies that apply to the hedged
items. Transactions are regarded as hedging transactions if
they have been categorized as such and there is a substantial
correlation between the hedging results and the results on
the positions being hedged. Gains or losses on the early
termination of a hedge are recognized as assets or liabilities
and amortized over the residual terms of the hedged
positions. Where financial instruments are used to hedge the
risks associated with particular assets or liabilities and the
hedged assets or liabilities are sold or terminated, such
financial instruments will no longer qualify as hedges.
Results on the settlement of a hedge are accounted for in the
same period as gains or losses on the settlement of the
hedged position.
CHANGE IN ACCOUNTING POLICY
Up to and including 31 December 2001, commission that is
similar in nature to interest was shown in the year of
receipt. In anticipation of the IAS regulations that will take
effect as from the beginning of 2005, commission that is
similar in nature to interest is now being shown in the
income statement during the term of the item in question
with effect from 1 January 2002. The effect of this
