2005 Annual Report / CrÃ©dit Agricole (Suisse) SA

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66 – 2005 Annual Report / Crédit Agricole (Suisse) SAValuation adjustments and provisionsThe Bank’s credit activity is limited mainly to Lombardloans and international trade financing. The particularityof these transactions is that repayment capacity is linkedto the collateral put up during the transactions (self liquidatingtransactions) as well as to the solvency of thedebtor.When there is doubt as to a debtor’s ability to honour hiscommitments, the Bank raises adequate provisions for theprincipal and interest, taking into account existing guaranteesand collateral, as well as the economic environment.These valuation adjustments, which are made on an individualbasis for each position, are charged directly againstthe balance sheet assets concerned. Interest deemeddoubtful under this rule is provisioned from the date onwhich serious doubts first arise.In accordance with the prudence principle, other identifiablerisks are covered by provisions recognised in the balancesheet under “valuation adjustments and provisions”.Reserves for General Banking RisksReserves for General Banking Risks are set aside as apreventive measure with the aim of covering underlyingrisks relating to the Bank’s activity. These reserves areconsidered as forming part of shareholders’ equity underSwiss banking law (Ordonnance Bancaire). Amountsallocated to or written back from the reserves for generalbanking risks are recognised as exceptional items. Nounderlying tax is taken into account on this item.Pension and benefit commitmentsThe Bank fulfils its legal obligation to insure employees,in application of pension laws, through the CréditAgricole (Suisse) SA Pension Plan. Crédit Lyonnais(Suisse) SA has a separate pension plan. These twopension schemes are defined contribution plans asrequired under Swiss recommendations for the presentationof accounts no. 16 (RPC 16). Credit Agricole(Suisse) SA’ s pension plan will take over that of CréditLyonnais (Suisse) SA so that their services are combinedas from 1 January 2006. The pension commitments andthe assets covering these commitments are held by alegally independent foundation. Contributions are includedin personnel costs. Furthermore, the foundations managetheir assets through the Bank, hence the related positionsare recorded in the latter’s balance sheet.Contingent commitments, irrevocable commitments,commitments to discharge and make supplementarypayments, and confirmed creditOff-balance sheet items are stated at their nominal value.A provision is raised for identifiable risks and recordedunder liabilities in the balance sheet.Financial derivativesThe Bank uses financial derivatives to manage its balancesheet structure and for trading purposes on behalf of itscustomers.The positive or negative replacement values of all derivativeinstruments outstanding at the balance-sheet date arerecorded gross under “other assets” and “other liabilities”respectively.Trading transactions are marked to market, whereasbalance sheet management transactions are valued inthe same way as the hedged positions.Valuation adjustments that are not recognised in theincome statement at the closing date are recorded ina netting account, which is included in “other assets”or “other liabilities” depending on the balance on theaccount.Layout of the notes to the financial statementsThe numbering of the notes follows the layout stipulatedby the Swiss Federal Banking Commission in its directivesgoverning the preparation of financial statements(DEC-CFB).
2005 Annual Report / Crédit Agricole (Suisse) SA – 673. Balance sheet Information3.5 Other assets and other liabilitiesReference yearPrevious year(in thousands of CHF) Other assets Other liabilities Other assets Other liabilitiesReplacement valuesof derivative instruments– Trading portfolio 553 575 529 464 214 230 215 637– Balance sheet management 98 327 25 437 2 967 71 375Indirect taxes 258 11 748 454 3 128Offset account 12 619 – 15 038 –Other assets and liabilities 3 225 4 405 1 085 4 157Total 668 004 571 054 233 774 294 2973.6 Assets pledged or assigned as security for own commitments,and assets subject to reservation of title clauses(in thousands of CHF)Book valueor amount ofpledged assetsReference yearEffectiveliabilitiesBook valueor amount ofpledged assetsPrevious yearEffectiveliabilitiesMoney-market instruments – – – –Financial investments 7 829 – 1 147 –Other assets 104 – 61 –Total 7 933 – 1 208 –Lending of securities and repurchase transactionsReference yearPrevious yearFair value of securities received as a guarantee under a securities loanand securities received under a securities borrowing transactionand by means of reverse repos, for which the right to make a subsequentalienation or pledge has been granted without restriction – 9 915– of which, fair value of above securities alienated or pledged to a third party as a guarantee – 7 093Parent Company Financial Statements
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2005 Annual Report / CrÃ©dit Agricole (Suisse) SA

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