Inhoudsopgave Voorwoord Bestuursverslag Corporate governance
Consolidated Financial Statements Company Financial Statements Pillar 3
income to the statement ofincome. If the impairment of
a debt instrument subsequently reverses and the reversal can
objectively be attributed to an event after the impairment, the
impairment is reversed through the statement of income.
Equity instruments are impaired if cost (initial recognition)
is unlikely to be recovered in the long term or if there is
a significant or prolonged decline in the fair value below its
cost. The recoverable amount and/or fair value of investments
in unlisted equity instruments are determined using generally
accepted valuation methods.The recoverable amount of
listed financial assets is determined on the basis of market
value. Impairment of equity instruments is never subsequently
reversed through the statement ofincome.
2.8 Repurchase agreements and reverse repurchase
agreements
Financial assets that are sold subject to related sale and
repurchase agreements are included in the financial statements
under'Financial assets held for trading'or'Available-for-sale
financial assets', as applicable. The liability to the counterparty
is included under'Deposits from banks'or'Deposits from
customers', as applicable.
Financial assets acquired under reverse sale and reverse
repurchase agreements are recognised as loans and advances
to banks' or loans and advances to customers', as applicable.
The difference between the sales and repurchasing prices is
recognised as interest income/expense over the term of the
agreement using the effective interest method.
2.9 Securitisations and (de)recognition of financial
assets and liabilities
Recognition of financial assets and liabilities
Purchases and sales of financial assets and liabilities classified as
fair value through profit or loss and available-for-sale financial
assets which are required to be delivered within a regulatory-
prescribed period or in accordance with market conventions
are recognised on the transaction date. Financial instruments
carried at amortised cost are recognised on the settlement date.
Securitisations and derecognition of financial assets and
liabilities
Rabobank securitises, sells and carries various financial
assets. Those assets are sometimes sold to a special purpose
entity (SPE) which then issues securities to investors. Rabobank
has the option of retaining an interest in these assets in
the form of subordinated interest-only strips, subordinated
securities, spread accounts, servicing rights, guarantees, put and
call options or other constructions.
A financial asset (or a portion thereof) is derecognised where:
The rights to the cash flows from the asset expire;
The rights to the cash flows from the asset and substantially
all the risks and rewards of ownership of the asset are
transferred;
A commitment has been made to transfer the cash flows
from the asset and a substantial portion of the risks and
rewards have been transferred; or
Not substantially all the risks and rewards are transferred but
where control over the asset is not retained.
A financial liability or a part thereof is derecognised if it ceases
to exist, i.e. after the contractual obligation has been fulfilled or
cancelled or has expired. Continuing involvement is recognised
if Rabobank neither retains nor transfers substantially all
the risks and rewards and control has retained.The asset is
recognised to the extent of Rabobanks continuing involvement
in it.
Where a transaction does not meet these conditions for
derecognition, it is recognised as a loan for which security has
been provided. To the extent that the transfer of a financial
asset does not qualify for derecognition, Rabobank's contractual
rights are not separately recognised as derivatives if recognition
of these instruments and the transferred asset, or the
liability arising from the transfer, were to result in the double
recognition of the same rights and obligations.
Profits and losses on securitisations and sale transactions
depend partly on the carrying amounts of the assets
transferred. The carrying amounts of these assets are allocated
to the interests sold and retained using the relative fair values
of these interests on the date of sale. Any gains and losses
are recognised through profit and loss at the time of transfer.
The fair value of the interests sold and retained is determined
on the basis of listed market prices or as the present value of
the future expected cash flows based on pricing models that
involve a number of assumptions regarding, for Instance, credit
losses, discount rates, yield curves, payment frequency and
other factors.
2.10 Cash and balances at central banks
Cash equivalents are highly liquid short-term assets held to
meet current cash obligations rather than for investment or
other purposes.These assets have terms of less than 90 days
from inception. Cash equivalents are readily convertible to
known amounts of cash and are subject to insignificant risk of
changes in value.
266 Rabobank Jaarverslag 2016