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Notes to the Financial Statements
31 March 2016
38 Financial Risk Management Objectives and Policies (in $ million) (continued)
(c) Interest rate risk (continued)
Sensitivity analysis:
The Group
31 March
2016 2015
Effect on
equity R1
Effect on
profit before
taxation R2
Effect on
equity R1
Effect on
profit before
taxation R2
Increase in one basis point in market interest rates 0.1 0.5 * 0.7
Decrease in one basis point in market interest rates (0.1) (0.5) * (0.7)
The Company
31 March
2016 2015
Effect on
equity R1
Effect on
profit before
taxation R2
Effect on
equity R1
Effect on
profit before
taxation R2
Increase in one basis point in market interest rates – 0.6 * 0.4
Decrease in one basis point in market interest rates – (0.6) * (0.4)
* Amount less than $0.1 million
R1 Sensitivity analysis on derivative financial instruments.
R2 Sensitivity analysis on variable rate assets and liabilities.
(d) Market rate risk
At 31 March 2016, the Group and the Company own investments of $1,441.2 million (2015: $1,096.2 million) and $1,356.3 million (2015:
$1,005.5 million) respectively, out of which $532.4 million (2015: $468.2 million) and $466.2 million (2015: $402.3 million) are subject to
market risk. The market risk associated with these investments is the potential loss resulting from a decrease in market prices.
Market price sensitivity analysis
If prices for these investments increase or decrease by 1% with all other variables being held constant, the before tax eects on equity
are set out in the table below.
Sensitivity analysis on investments:
The Group
31 March
The Company
31 March
2016 2015 2016 2015
Effect on equity Effect on equity
Increase in 1% of quoted prices 5.3 4.7 4.7 4.0
Decrease in 1% of quoted prices (5.3) (4.7) (4.7) (4.0)
Singapore Airlines204
FINANCIAL