2012 Annual Report - Financial Statements (English) - Khaleeji ...

KHALEEJI COMMERCIAL BANK BSCNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the year ended 31 December 2012 | BD 000’s31. RISK MANAGEMENT (continued)MARKET RISK (continued)Exposure to profit rate risk–non–trading portfoliosThe principal risk to which non-trading portfolios are exposed is the risk of loss from fluctuations in the future cash flows or fair values offinancial instrument because of a change in market profit rates. Profit rate risk is managed principally through monitoring profit rate gapsand by having pre-approved limits for re-pricing bands. The ALCO is the monitoring body for compliance with these limits and is assistedby the Bank’s Risk Management Department in its day-to-day monitoring activities.A summary of the Bank’s profit rate gap position at 31 December 2012 is as follows:31 December 2012 Up to 3months3 - 6months6 months -1 year1 - 3yearsMore than3 yearsTotalAssetsPlacements with financial institutions 57,525 - - - - 57,525Financing assets 46,415 13,528 6,437 90,192 89,173 245,745Assets acquired for leasing (including leaserentals receivable)- - 22 3,571 20,380 23,973Investments securities (sukuk) 7,448 - 905 - 4,015 12,368Total profit rate sensitive assets 111,388 13,528 7,364 93,763 113,568 339,611Liabilities and investment accountsPlacements from financial institutions 50,216 - - 17,516 - 67,732Placements from non-financial institutionsand individuals12,319 7,594 27,072 5,129 1,302 53,416Customers’ current accounts 189 - - - - 189Equity of investments account holders 119,794 37,572 54,097 4,966 - 216,429Total profit rate sensitive liabilities andinvestment accounts182,518 45,166 81,169 27,611 1,302 337,766Profit rate gap (71,130) (31,638) (73,805) 66,152 112,266 1,84560Annual Report 2012