Annual report 2004 (PDF, 4141 kB) - Unicredit Bank

In 2004 and 2003, the Bank did not restructure any of its receivables from banks. In 2004 and
2003 the Bank classified all claims from banks as standard.
5 DUE FROM CUSTOMERS
31 December 2004
CZK m
31 December 2003
CZK m
Public sector 98 72
Financial sector 863 1 421
Non-financial sector - legal persons 20 873 19 567
Physical persons 3 307 2 158
25 141 23 218
Allowance for impaired loans (Note 10) - 621 - 432
24 520 22 786
In addition to the allowance for impaired loans the Bank has reflected a general provision
for loans of CZK 256 million at 31 December 2004 (31 December 2003: CZK 410 million).
This provision has to be utilised or written back to income by 31 December 2005 (Note 2(p),
Note 10).
The Bank restructured CZK 159 million of its loans and receivables in 2004 (31 December
2003: CZK 134 million). Loans and other receivables are considered as restructured in case
that the Bank grants relief to clients because it is likely that the Bank would incur losses if
acting otherwise. Roll-over of a short-term loan is not considered to be restructuring of the
loan in the case where the client has fulfilled all requirements of loan agreements.
As at 31 December 2004 the Bank led syndicate loans of CZK 167 million (31 December
2003: CZK 167 million).
(a)
Quality of loan portfolio
Loans are categorised in accordance with the definitions issued by the CNB in five categories
(standard, watch, substandard, doubtful, loss). Impaired loans include substandard, doubtful
and loss loans and represent total outstanding principal and accrued interest receivable with
service payments overdue more than 90 days or other defaults in contractual terms
or financial performance. Watch loans are usually overdue between 30 – 90 days or other
risks characteristic are presented. Administration of impaired receivables, including their
recovery, is performed by a separate department in the Bank.The Bank does not apply
a portfolio approach to the categorisation of receivables. Each receivable is considered
individually, as is also the case for the creation of provisions.
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