ING Direct 2011 Annual Report Download - page 184

Notes to the consolidated annual accounts of ING Group continued
There were no significant transfers between Level 1 and 2.
Changes in Level 3 Assets
2010 Trading assets
Investments for
risk of
policy-holders
Non-trading
derivatives
Financial assets
designated as at
fair value through
profit and loss
Available-for-sale
investments Total
Opening balance 1,366 54 541 1,830 7, 243 11,034
Amounts recognised in the profit and loss account
during the year 193 –5 –275 3–232 –316
Revaluation recognised in equity during the year 1,047 1,047
Purchase of assets 1,394 134 554 608 1,365 4,055
Sale of assets –899 –143 –340 –637 –720 –2,739
Maturity/settlement –275 –2 –96 –775 –1,148
Transfers into Level 3 474 87 143 21 1,156 1,881
Transfers out of Level 3 –150 –4 –3,355 –3,509
Exchange rate differences 29 914 121 375 548
Closing balance 2,132 136 635 1,846 6,104 10,853
Main changes in fair value hierarchy (2010 compared to 2009)
Amounts in each of the levels of the fair value hierarchy are impacted by changes in the volume of portfolios and fluctuations in pricing
levels and foreign currency rates. The amount in Level 3 is impacted by improved market activity in this area leading to increased trading
and increases in portfolio volume in financial instruments that qualify for Level 3.
Level 3 assets increased because certain bonds were transferred to Level 3 in 2010 as a result of reduced market liquidity and/or pricing
sources that could no longer be classified as market observable. On the other hand, Level 3 assets decreased in 2010 because of a transfer
of available-for-sale investments of EUR 2.9 billion out of Level 3 to Level 2, relating to mortgage backed securities in the United States.
Previously these were classified in Level 3 because of the dispersion between prices obtained for the same security from different price
sources. In 2010 prices supported by market observable inputs became available and were used in determining fair value.
There were no significant transfers between Level 1 and 2.
Changes in Level 3 Liabilities
2011
Trading
liabilities
Non-trading
derivatives
Financial
liabilities
designated as
at fair value
through profit
and loss
Investment
contracts
(for contracts
carried at
fair value) Total
Opening balance 1,441 1,876 3,225 17 6,559
Amounts recognised in the profit and loss account during the year 46 183 113 342
Issue of liabilities 1,138 502 1,613 73,260
Early repayment of liabilities –705 –49 –402 –3 –1,159
Maturity/settlement –928 –400 –645 –1,973
Transfers into Level 3 125 25 441 591
Transfers out of Level 3 –175 –2 –80 –9 –266
Exchange rate differences –2 63 7 68
Changes in the composition of the group –16 –16
Closing balance 940 2,182 4,272 12 7,406
Changes in Level 3 Liabilities
2010 Trading liabilities
Non-trading
derivatives
Financial liabilities
designated as at
fair value through
profit and loss
Investment
contracts (for
contracts carried
at fair value) Total
Opening balance 857 1,361 2,589 39 4,846
Amounts recognised in the profit and loss account during the year 119 85 –5 199
Revaluation recognised in equity during the year 9 9
Issue of liabilities 1,679 490 2,241 10 4,420
Early repayment of liabilities –876 –247 –863 –55 –2,041
Maturity/settlement –326 –1 –561 –888
Transfers into Level 3 165 282 11 458
Transfers out of Level 3 –176 –67 –266 –509
Exchange rate differences –1 58 8 65
Closing balance 1,441 1,876 3,225 17 6,559
182 ING Group Annual Report 2011