Explanatory Notes
General
Basis of Consolidation
Accounting Policies and
Determination of Result
FGH BANK N.V. is a group company of AEGON N.V.,
registered in The Hague.
The present financial statements have been drawn up in
accordance with the provisions laid down in Part 9,
Book 2 of the Dutch Civil Code,- the Decree governing
Financial Statements prepared by Banks; the Financial
Statements Formats Decree; and relevant
recommendations made by De Nederlandsche
Bank N.V.
The company's financial statements are incorporated in
the published financial statements of AEGON N.V.,
The Hague. A copy of these financial statements is
available there.
All figures are expressed in thousands of guilders,
unless otherwise stated.
On November 1, 1996 our subsidiary Nederlandse
Hypotheekbank N.V. acquired a 50% stake in the
partnership firm Bank voor Hypothecaire Financiering
in Eindhoven.
This partnership's activities chiefly concern the
provision of loans and credit with mortgages or other
forms of security and all associated banking business.
The other 50% of this partnership firm was already
owned by FGH BANK N.V. The partnership's results
have therefore been fully consolidated since
November 1, 1996.
The group financial statements include the
figures for FGH BANK N.V., its subsidiaries
and group 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 that are only
held with a view to disposal.
Proportional consolidation has been applied to
participating interests designated as joint ventures,
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 the heading 'Income
from securities and participating interests'.
Assets and Liabilities
Assets and liabilities are valued at nominal value,
unless otherwise stated.
Where appropriate, the value of the assets has been
reduced accordingly.
Reductions in value are generally determined per item.
Any subsequent upward value adjustments and re
adjustments of downward value adjustments applied to
the 'Loans' item are shown in the income statement
under 'Value adjustments to receivables'.
Participating interests
Participating interests are valued at their net asset value
on the basis of the accounting policies as applied by
FGH BANK N.V. Interests in non-consolidated
participating interests in excess of 20% are valued on
the basis of their net asset value. Changes in the net
asset value of participating interests, insofar as they
relate to results achieved, plus the income from the sale
of participating interests, are recognized under 'Income
from securities and participating interests'.
Real Estate and Equipment
Real estate for own use:
Office buildings in own use are valued at replacement
cost.
The buildings in question are depreciated on the basis of
replacement value over their estimated useful life with
allowance being made for a residual value. The change
in value as a result of this accounting policy is taken to
the revaluation reserve with allowance being made for
deferred taxation.
Real estate not for own use:
- Properties earmarked for sale are valued at acquisition
or development cost, less depreciation or, if lower, at
net realizable value.
- Properties to be kept as long-term investments are
valued at net realizable value.
- Development properties are valued at the lower of
construction cost and net realizable value.
Equipment:
Equipment is valued at acquisition cost less
depreciation; the latter is calculated on a straight-line
basis over the estimated useful life.
