COMMERZBANK AKTIENGESELLSCHAFT

To our Shareholders Corporate Responsibility Management Report Risk Report Group Financial Statements Further Information 255 311
258 202 Statement of comprehensive income
260 204 Balance sheet
262 206 Statement of changes in equity
264 208 Cash flow statement
266 210 Notes
409 353 Auditors’ report
In its press release of October 13, 2008, the IASB issued an
amendment to IAS 39 relating to the reclassification of financial
instruments. In accordance with the amendment, securities in
the Public Finance portfolio for which there was no active
market were reclassified from the available-for-sale financial
assets category to the loans and receivables category in the
financial years 2008 and 2009. In respect of the reclassified
securities there was the intention and ability at the
reclassification date to hold the securities for the foreseeable
future or to final maturity. The securities concerned are
primarily issued by public-sector borrowers (including European
and North American local authorities and publicly guaranteed
asset-backed securities) and financial institutions.
The revaluation reserve after deferred taxes for all the
securities reclassified in financial years 2008 and 2009 was
€– 0.8bn as at December 31, 2011 (previous year: €– 1.0bn). This
negative portfolio will be dissolved over the remaining lifetime
of the reclassified securities. If these reclassifications had not
been carried out in 2008 and 2009, there would have been a
revaluation reserve after deferred taxes of €– 4.3bn for these
securities as at December 31, 2011 (previous year: €– 2.8bn); the
change compared with a year ago was therefore €– 1.5bn
(change December 31, 2009 to December 31, 2010: €– 1.4bn).
In addition to the portfolio valuation allowances of €40m
(previous year: €1m) and the impairments on the reclassified
Greek government bonds (€1.9bn), a net €1.5bn (previous year:
€1.8bn) was recognised in the income statement for the
reclassified securities in the current financial year.
On December 31, 2011 the carrying amount of the
reclassified securities was €57.6bn (previous year: €67.1bn), fair
value was €52.6bn (previous year: €64.6bn) and the cumulative
portfolio valuation allowances were €91m (previous year:
€51m). The transactions had average effective interest rates of
between 0.5% and 14.3% (previous year: between 0.8% and
16.2%) and are expected to generate a cash inflow of €70.2bn
(previous year: €84.3bn).
Impact of the European sovereign debt crisis
In the Commerzbank Group, the acquisition cost of Greek
government bonds as of December 31, 2011 before adjusting for
the total impairment requirement of around 74% was €3,018m
(including accrued interest). Of this, €359m related to availablefor-sale
bonds and €2,659m to securities that were reclassified
to the loans and receivables category in 2008 and 2009. The
impairments applicable to them as of December 31, 2011
totalled €2,226m.
On the basis of our measurement methodology this resulted
in a €1,938m write-down in the value of securities in the loans
and receivables category. The carrying amount of these
securities was therefore €721m as of December 31, 2011. The
write-down under IAS 39.67 of the remaining bonds in the
available-for-sale category to this lower fair value (market value
as of December 31, 2011) led to a €288m expense in the current
financial year with a carrying amount of €71m as of
December 31, 2011.
We also executed hedging transactions to protect our
portfolio against interest rate risk and to offset the effects of
fluctuations in inflation. We recognise and measure these
financial instruments in accordance with IAS 39.85 ff. The
remeasurement effects result both from unwinding the financial
instruments used for interest-rate hedging, and from writing
down the financial instruments used to hedge fluctuations in
inflation to the same extent as the bonds; the new carrying
amount totalled €58m. The total impairment effect for these
transactions amounted to €962m in 2011.
Group Financial Statements