Value adjustments

In 2011, total value adjustments doubled to €59 million compared to 2010, mainly as a result of increased impairments on equity investments.

Value adjustments on equity investments increased sharply by €25 million to €36 million.

The additional impairments on equity investments compared to the total value of our portfolio increased to 4.6% in 2011 (2010: 1.6%). Impairments were driven by the individual circumstances of the concerning investments and no general trend in impairments has been identified.

The value adjustments on loans and guarantees increased to €23 million (2010: €18 million). The increased disbursements in 2011 were the main reason for the higher value adjustments on loans, due to the group-specific value adjustments. Counterparty specific value adjustments declined slightly, reflecting the stable and high quality of our loan portfolio. Management of FMO deems the level of counterparty specific and group specific value adjustments a sufficient reflection of the risks of the portfolio.