Page 191 - Capricorn IAR 2020

Group
Company
2020 INTEGRATED ANNUAL REPORT
NOTES TO THE CONSOLIDATED AND SEPARATE ANNUAL FINANCIAL STATEMENTS (continued)
for the year ended 30 June 2020
3. FINANCIAL RISK MANAGEMENT (continued)
3.3 Market risk (continued)
3.3.3 Interest rate risk (continued)
(ii) Interest rate sensitivity analysis
An interest sensitivity analysis shows how net interest income will perform under a variety of scenarios. The sensitivities below measure the effect of overall changes in interest rates on profit or loss (net interest income) as defined by the banks’ interest rate modelling tool. The extent of the shock (50, 100 or 200 basis points) is applied to all interest rates in the system and the effects of these shocks are detailed below.
2020 N$’000
2020 N$’000
77,152
60,674
(5,398)
236,544
243,507 (182,833)
5,528
(10,926)
5,327 (7,614)
(159,392)
(75,696)
(49,635)
(229,480) 179,845
5,398
(230,755)
(5,528)
(5,327) 7,614
155,059
10,926
146,602
120,275
(10,797)
473,532
487,530 (367,255)
11,055
10,654 (15,228)
(326,930)
(458,354) 357,792
(21,852)
(148,722)
(100,562)
10,797
(457,218)
(11,055)
(10,654) 15,228
308,496
21,852
273,872
239,951
(21,594)
948,947
977,341 (737,390)
22,111
(43,704)
21,307 (30,457)
(675,074)
(327,152)
(238,777)
581,991
(915,330) 676,553
21,594
(909,144)
(22,111)
(21,307) 30,457
43,704
2019 N$’000
2019 N$’000
(2,287)
2,287
(4,575)
4,575
(9,149)
9,149
The following interest rate sensitivity is based on the effect of changes to the interest rate over a 12-month period on net interest income:
50 basis points increase
– Increase in interest income – Increase in interest expense
50 basis points decrease
– Decrease in interest income – Decrease in interest expense
100 basis points increase
– Increase in interest income – Increase in interest expense
100 basis points decrease
– Decrease in interest income – Decrease in interest expense
200 basis points increase
– Increase in interest income – Increase in interest expense
200 basis points decrease
– Decrease in interest income – Decrease in interest expense
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