8 Fair value of financial instruments

The table shows the fair values of financial instruments, based on the valuation methods explained in the following, and assumptions. The fair value represents a market-based measurement and not an entity- specific valuation. It is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date on the principal market or the most advantageous market. Details about the measurement of fair values are shown in note 36.

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Fair value of financial instruments

 

31.12.2014

31.12.2013

in CHF thousands

Carrying Value

Fair Value

Deviation

Carrying Value

Fair Value

Deviation

Assets

 

 

 

 

 

 

Cash and balances with central banks

1'362'755

1'362'755

0

2'075'560

2'075'560

0

Due from banks

5'773'872

5'780'173

6'301

6'082'003

6'087'903

5'900

Due from customers

10'723'355

11'265'729

542'374

10'240'089

10'598'019

357'930

Trading portfolio assets

560

560

0

5'061

5'061

0

Derivative financial instruments

87'781

87'781

0

86'951

86'951

0

Financial investments at fair value

2'397'076

2'397'076

0

1'969'238

1'969'238

0

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Due to banks

484'599

484'985

−386

981'065

981'403

−338

Due to customers

15'657'835

15'698'847

−41'012

15'599'995

15'601'866

−1'871

Liabilities from insurance contracts

75'650

75'650

0

266'151

266'151

0

Financial liabilities at fair value

1'193'397

1'193'397

0

811'778

811'778

0

Derivative financial instruments

165'809

165'809

0

108'929

108'929

0

Debt issued

1'152'960

1'221'721

−68'761

1'127'597

1'164'140

−36'543

 

 

 

 

 

 

 

Deviation between fair value and carrying value

 

 

438'516

 

 

325'078

The following valuation methods are applied in calculating the fair value of financial instruments:

Cash and balances with central banks and money market instruments

These financial instruments have a maturity or a refinancing profile of maximum one year. The book value corresponds approximately to fair value.

Due from / to banks, loans and due to customers

The fair value of these positions having a maturity or a refinancing profile are determined using similar maturity swap rates. Replicate portfolios are employed for products for which fixed interest rates or cash flows are not known in advance.

Trading portfolio assets, derivative financial instruments, financial investments at fair value through profit and loss, investment property and due from / to insurance business

For the majority of financial instruments, fair value corresponds to the market value. The fair value of financial instruments without an established market value is determined using generally accepted valuation models.

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