12. Financial instruments plus valuation hierarchies for fair value measurements

Investments are broken down into the following classes and categories of financial instruments:

Valuation hierarchy

Assets and liabilities measured at fair value

Fair values of assets and liabilities measured at amortised cost

Assets and liabilities measured at fair value as at the previous year’s reporting date

Fair values of assets and liabilities measured at amortised cost as at the previous year’s reporting date

Transfers between levels 1 and 2

During the reporting period, transfers from Level 1 to Level 2 were made in the amount of € 1,346,667 thousand and from Level 2 to Level 1 in the amount of € 1,074,490 thousand. These are attributable primarily to changes in trading frequency and trading activity.

Level 3 financial instruments

In accordance with the hierarchy set forth in IFRS 13, Level 3 primarily includes fixed-income securities and other equity investments that come under the category “Available for sale”. The other equity investments include the shares in Raiffeisen Zentralbank Österreich Aktiengesellschaft (RZB shares) as their most crucial individual item.

The following table shows the changes to the fair values of financial instruments whose valuation procedures are not based on observable input factors.

The transfers between Levels 2 and 3 were completed as a result of changes in the observability of the relevant input factors.

Sensitivities

The sensitivity analysis for the RZB shares was determined in the course of a valuation report. It relates to a change in the discount interest rate and the increase or decrease in the growth rate. An increase in the discount rate by 100 basis points results in a 15 per cent reduction in the value of the RZB shares. A reduction in the discount rate by 100 basis points results in a 12 per cent reduction in the value. An adjustment to the growth rate by 100 basis points results in virtually no adjustment in value.

The sensitivity analyses for the RZB shares are shown below.

For the most important fixed-income securities, an increase in the discount rate of 100 basis points results in a 2.0 per cent reduction in the value. A reduction in the discount rate by 100 basis points results in a 2.8 per cent increase in value.

Fixed-income securities

On 1 July 2008 securities previously available for sale were reclassified according to IAS 39/50E as other loans. Overall fixed-income securities with a carrying amount of € 2,129,552 thousand were reclassified. The corresponding amount from the measurement of the financial instruments available-for-sale at 30 June 2008 was € –98,208 thousand.

Loans and other investments

Fair values essentially correlate with book values.

Contractual maturities