DHL 2010 Annual Report Download - page 112

As at  December , Deutsche Post  was still in possession of ,,
Postbank shares. In the second tranche, an additional  million Postbank shares
were transferred in exchange for a mandatory exchangeable bond subscribed to by
DeutscheBank  with a cash value at the time of closing of  , million.  e bond
will be fully exchanged a er three years. It accrues interest at a rate of   per year and
will mature on  February .
 e remaining ,, Postbank shares will be transferred via the exercise of call
and put options agreed between Deutsche Post  and Deutsche Bank . Both the call
and the put options can be exercised between the third and fourth years a er the date
on which the agreement was concluded ( February ).
 e changes in the fair value of the forward transaction (second tranche) and the
call and put options (third tranche) led to considerable volatility on the balance sheet in
the past  nancial year. In the following  nancial years, changes in the fair value of the
derivatives will continue to substantially impact net  nance costs/net  nancial income.
To some extent, this impact will be negated by o setting changes in the fair value ofthe
remaining shareholding in Postbank.  is risk is explained in greater detail in the Notes ,
where you will also  nd information on other balance sheet and  nancial risks.
Risks from pending legal proceedings
Information on legal risk is provided in the Notes.
Other risks faced by the Group
Our  nancing and insurance strategy, which saved us nearly   million in ,
separates insurable risk into two groups.
 e  rst group comprises risks with a high probability of occurrence and low indi-
vidual cost.  ese risks are insured via what is known as a captive, an insurance company
owned by the Group that is able to insure such risks at a lower cost than commercial
insurers.  e majority of our insurance expenditure is incurred for this risk group, which
along with lower costs o ers other advantages. Costs remain stable as the Group is less
a ected by changes in the availability and price of outside insurance. We receive reliable
data on the basis of which we can analyse risk with a high probability of occurrence
and low individual cost. We can then set minimum standards and targets for such risk.
 e second group consists of risks that have a low probability of occurrence but
could entail high losses, such as air transport risks.  ese risks are transferred to com-
mercial insurers.
Audits are currently underway at  Express  and Airborne Inc. under the
unclaimed property laws in the United States. According to these laws, unclaimed prop-
erty must either be returned to its rightful owner or the home country of the most recent
owner or, if this is not known, the country in which the company is domiciled.  e
probability of a signi cant  nancial impact on the Group is fairly low.
Note 
Note 
Deutsche Post DHL Annual Report 
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