2011 Annual Report Financial Supplements - BDO

NOTES TOFINANCIAL STATEMENTSDECEMBER 31, 2011, 2010 AND 2009(Amounts in Millions of Philippine Pesos, Except Per Share Data or As Indicated)Parent Bank2011Change in interest rates (in basis points)-100 +100 -50 +50Change on annualizednet interest income (P 1,633) P 1,633 (P 816) P 816As a percentage of ParentBank’s net interestincome for 2011 ( 5.1%) 5.1% ( 2.6%) 2.6%Earnings-at-risk P 1,9182010Change in interest rates (in basis points)-100 +100 -50 +50Change on annualizednet interest income (P 1,365) P 1,365 (P 683) P 683As a percentage of ParentBank’s net interestincome for 2010 ( 4.3%) 4.3% ( 2.2%) 2.2%Earnings-at-risk P 4194.02.03 Price RiskBDO Unibank Group is exposed to equity securities price risk because of investments held byBDO Unibank Group and classified on the statement of financial position either as AFS or atFVTPL. BDO Unibank Group is not exposed to commodity price risk. To manage its pricerisk arising from investments in equity securities, BDO Unibank Group diversifies itsportfolio. Diversification of the portfolio is done in accordance with the limits set by BDOUnibank Group.The table below summarizes the impact of increases of the financial assets at FVTPL and AFSsecurities on BDO Unibank Group’s net profit after tax and equity as ofDecember 31. The analysis is based on the assumption that the correlated equity indices haveincreased by 3.04% in 2011 and increased by 17.2% in 2010 for securities classified as FVTPLand AFS securities with all other variables held constant and all BDO Unibank Group’s equityinstruments moved according to the historical correlation with the index.BDO Unibank GroupImpact onImpact on othernet profit after tax comprehensive incomeincrease (decrease) increase (decrease)2011 2010 2011 2010Financial assets at FVTPL P 2 P 1 P - P -AFS securities - - 115 540P 2 P 1 P 115 P 540