4.4. Other investments
4.4. Other financial investments
4.4.1. Investments in securities (other than unit-linked financial investments)
| (CZK’000) | 31 December 2016 | 31 December 2015 |
|---|---|---|
| Shares and other equity securities with variable income | 1,182,226 | 1,910,639 |
| Debt securities | 12,764,187 | 11,571,923 |
| Total fair value | 13,946,413 | 13,482,562 |
Acquisition cost of securities can be analyzed as follows:
| (CZK’000) | 31 December 2016 | 31 December 2015 |
|---|---|---|
| Shares and other equity securities with variable income | 1,158,405 | 1,929,915 |
| Debt securities | 11,679,937 | 10,591,608 |
| Total acquisition cost of securities carried at fair value | 12,838,342 | 12,521,523 |
4.4.2. Shares and other variable yield securities
| (CZK’000) | 31 December 2016 | 31 December 2015 |
|---|---|---|
| Main or auxiliary market of recognized stock exchanges | 132,860 | 116,926 |
| Unquoted | 136,862 | 540,462 |
| Recognized foreign stock exchanges | 888,683 | 1,272,527 |
| Total acquisition price | 1,158,405 | 1,929,915 |
| Revaluation to fair value | 23,821 | (19,276) |
| Total fair value | 1,182,226 | 1,910,639 |
4.4.3. Debt securities
| (CZK’000) | 31 December 2016 | 31 December 2015 |
|---|---|---|
| Bonds at fair value in profit and loss | ||
| Main or auxiliary market of recognized stock exchanges | 5,862,183 | 6,240,063 |
| Unquoted | 11,404 | 7,259 |
| Recognized foreign stock exchanges | 5,806,350 | 4,344,286 |
| Total | 11,679,937 | 10,591,608 |
| Revaluation to fair value | 1,084,250 | 980,315 |
| Total fair value | 12,764,187 | 11,571,923 |
4.4.4. Deposits with financial institutions, other loans and other financial investments
| (CZK’000) | 31 December 2016 | 31 December 2015 |
|---|---|---|
| Deposits with financial institutions | ||
| Total fair value | 357,661 | 410,556 |
| Other loans | ||
| Loans secured by insurance contract | 3,244 | 3,304 |
| Reverse repo operations | 1,579,509 | 90,000 |
| Fair value | 1,582,753 | 93,304 |
| Other investments | ||
| Currency swaps and forwards | (114,323) | 38,424 |
| Interest swaps | 689 | (8,551) |
| Fair value of derivatives | (113,634) | 29,873 |
Although above stated derivatives provide an effective financial hedging from the perspective of risk management, they do not qualify for hedge accounting under Czech accounting standards criteria and therefore are recognized as derivatives for trading. Revaluation difference of the derivatives is reported in the income statement.
Significant increase in reverse repo operations is a result of an alternative technique of hedging of part of the Company‘s portfolio in foreign currency. Reverse repo operations provide an effective alternative to currency swaps from the cost perspective and thus help to reduce total costs of currency hedging.
Receivables from reverse repo operations are secured by collateral which is a financial asset received as part of a reverse repo transaction in same value.
Financial derivatives were valued using only market prices or valuation models based on observable market data only.