MORNBFI Vol. 1 - Planters Development Bank

APP. Q-2011.12.31securities since the initial recognition ofthose assets, although the decrease cannotyet be identified with the individualsecurities in the portfolio, including:(1) adverse change in the paymentstatus of issuers in the portfolio; or(2) national or local economicconditions that correlate with defaults on thesecurities in the portfolio.The disappearance of an active marketbecause an FI’s held securities are no longerpublicly traded is not evidence ofimpairment. A downgrade of an issuer’scredit rating is not, of itself, evidence ofimpairment, although it may be evidence ofimpairment when considered with otheravailable information. A decline in the fairvalue of a security below its cost oramortized cost is not necessarily evidenceof impairment (for example, a decline in fairvalue of an investment in debt security thatresults from an increase in the risk freeinterest rate).In addition to the types of eventsenumerated in Items “a” to “f” in this Section,objective evidence of impairment for aninvestment in an equity instrument includesinformation about significant changes withan adverse effect that have taken place inthe technological, market, economic or legalenvironment in which the issuer operatesand indicates that the cost of the investmentin the equity instrument may not berecovered. A significant or prolongeddecline in the fair value of an investment inan equity security below its cost is alsoobjective evidence of impairment.Sec. 6. Operations Manual. The FI shallmaintain an operations manual for bookingand valuation of HTM, Securities at FairValue through Profit or Loss, Available forSale and INMES.These guidelines shall no longer beapplicable when an FI adopts PFRS 9 underAppendix Q-56.(As amended by Circular Nos. 738 dated 11 October 2011, 670dated 18 November 2009, 733 dated 05 August 2011, 708 dated10 January 2011, 628 dated 31 October 2008, 626 dated 23October 2008, 558 dated 22 January 2007, 546 dated 21 September2006 and 509 dated 01 February 2006)Q RegulationsAppendix Q-20 - Page 8Manual of Regulations for Non-Bank Financial Institutions