Aviva 2013 Annual Report Download - page 171

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Aviva plc
Annual report and accounts 2013
169
Notes to the consolidated financial statements continued
24 – Loans
This note analyses the loans our Group companies have made, the majority of which are mortgage loans.
(a) Carrying amounts
The carrying amounts of loans at 31 December 2013 and 2012 were as follows:
2013 2012
At fair value
through
profit or
loss other
than trading
£m
At
amortised
cost
£m
Total
£m
At fair value
through
profit or
loss other
than trading
£m
At
amortised
cost
£m
Total
£m
Policy loans 1 888 889 2 1,309 1,311
Loans to banks 757 4,087 4,844 — 4,250 4,250
UK securitised mortgage loans (see note 25) 2,169 — 2,169 2,218 — 2,218
Non-securitised mortgage loans 15,550 192 15,742 16,753 3,211 19,964
Loans to brokers and other intermediaries — 78 78 — 89 89
Other loans — 157 157 — 102 102
Total 18,477 5,402 23,879 18,973 8,961 27,934
Less: Amounts classified as sale — — — (56) (3,341) (3,397)
18,477 5,402 23,879 18,917 5,620 24,537
Loans to banks include cash collateral received under stock lending arrangements (see note 27(d)). The obligation to repay this
collateral is included in payables and other financial liabilities (note 51).
Of the above loans, £21,850 million (2012: £19,179 million) are due to be recovered in more than one year after the statement
of financial position date.
Loans at fair value
Fair values have been calculated by discounting the future cash flows using appropriate current interest rates for each portfolio
of mortgages. Further details of the fair value methodology are given in note 23.
The change in fair value of these loans during the year, attributable to a change in credit risk, was £43 million loss (2012:
£491 million loss). The cumulative change attributable to changes in credit risk to 31 December 2013 was £2,709 million loss
(2012: £2,665 million loss).
Non-securitised mortgage loans include £4.1 billion (2012: £4.1 billion) relating to UK primary healthcare and PFI businesses
which are secured against General Practitioner premises, other primary health-related premises or other emergency services related
premises. For all such loans, government support is provided through either direct funding or reimbursement of rental payments to
the tenants to meet income service and provide for the debt to be reduced substantially over the term of the loan. Although the
loan principal is not government-guaranteed, the nature of these businesses and premises provides considerable comfort of an
ongoing business model and low risk of default.
Loans at amortised cost
The fair value of these loans at 31 December 2013 was £5,334 million (2012: £8,735 million).
(b) Analysis of loans carried at amortised cost
2013 2012
Amortised
Cost
£m
Impairment
£m
Carrying
Value
£m
Amortised
Cost
£m
Impairment
£m
Carrying
Value
£m
Policy loans 888 — 888 1,309 — 1,309
Loans to banks 4,087 — 4,087 4,250 — 4,250
Non-securitised mortgage loans 343 (151) 192 3,335 (124) 3,211
Loans to brokers and other intermediaries 78 — 78 89 — 89
Other Loans 157 — 157 106 (4) 102
Total 5,553 (151) 5,402 9,089 (128) 8,961