The following table sets out the fair value of the financial instruments held as at 31 December 2019. The fair value of listed government paper and interest-bearing securities is the market value. The fair value of unlisted government paper and interest-bearing securities is public quoted information if available or nominal value. The fair value of banks, loans and funds entrusted has been determined by calculating the net present value of expected interest and redemption cashflows, taken into account market interest rates as at the end of the year. Part of the loans and mortgages include caps and/or floors on the interest rates. For these instruments the fair value is determined by adding the present value of the contractual cash flows (based on forward rates) to the option value of these embedded caps and floors. An assumed prepayment rate is also included which differs per banking entity and between mortgages and business loans. We did not include a term structure in the spread. The fair value of the other items is assumed to be equal to the balance sheet value.

The fair value of the remaining assets also includes the deferred tax item.

 

2019

2018

in thousands of EUR

Balance sheet value

Fair
value

Balance sheet value

Fair
value

1

The fair value is negatively impacted by the tax effect of all fair value adjustments which has been posted as other.

Assets

 

 

 

 

Cash

2,270,224

2,270,224

1,795,272

1,795,272

Banks

227,561

227,611

237,055

237,062

Loans

8,187,470

8,315,161

7,247,970

7,362,465

Interest rate swaps to hedge the interest risk on fixed interest rate loans

–2,429

–1,342

Interest-bearing securities

1,023,422

1,058,201

1,258,216

1,294,055

Interest rate swaps to hedge the interest risk on fixed interest rate securities

–1,674

–1,226

Shares

20

20

20

20

Participating interests

24,279

24,279

22,448

22,448

Other

327,322

288,8141

289,097

253,9361

 

12,060,298

12,180,207

10,850,078

10,962,690

 

 

 

 

 

Liabilities and equity

 

 

 

 

Banks

70,023

68,714

67,217

66,493

Funds entrusted

10,690,005

10,695,702

9,558,203

9,566,057

Other

100,728

100,728

112,781

112,781

Equity

1,199,542

1,199,542

1,111,877

1,111,877

Revaluation on equity

115,521

105,482

 

12,060,298

12,180,207

10,850,078

10,962,690

The estimated fair values provided by financial institutions are considered not to be comparable on an individual basis, due to the differences in valuation methods applied and the use of estimates in these valuations. The lack of an objective method of valuation means that estimated fair values are subjective in respect of the expected maturity and interest rates used.