Annual Report of Euram Bank 2019


Foreign currency amounts

Foreign currency amounts are translated at the middle rates set on the reporting date, in

accordance with section 58 (1) BWG.

Financial assets

Investments are valued at cost of acquisition. Lower values are recognized in the case of material,

sustained impairments.

Securities held as fixed assets are measured at the lower of fair value and cost of acquisition on the

balance sheet date. Unscheduled write-downs to a fair value that is lower on the reporting date are

performed where the impairments are likely to be permanent.

Write-ups on fixed assets are performed if the reasons for the unscheduled write-down have lapsed.

Current assets

Securities held as current assets were reported at cost of acquisition less value adjustments for

discernible individual risks or possibly a lower share price, market value, or market value derived

from a similar financial instrument, on the reporting date.

The company does not keep a trading book.

Receivables and other assets are reported at their nominal value less value adjustments for

identifiable individual risks. Moreover, to take account of credit risks within loans and advances to

customers, a general impairment provision was made for performing portfolios.

The recoverability of loans and advances to customers is estimated based on the impairment

indicators and the collateral provided. In doing so, the fair values less haircuts are used. Estimates

are based on prudent assessments. The calculation of the general impairment provision for

non-defaulted customers is based on a valuation model that also takes into account, in the course

of an internal credit rating process, the probabilities of default determined by external rating

agencies, apart from customer exposure and collateral values. To the extent that statistically

identifiable data from similar situations are available, the company has taken them into account

when preparing the estimates; for instance, collateral haircuts and historical default rates published

by Creditreform (Verband der Vereine Creditreform e.V.).


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