My first Publication ocbc_ar17_fullreport_english | Page 190

NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2017
15. REVENUE RESERVES
GROUP
2017
$’000
Unappropriated profit (Note 12)
General reserves
Cash flow hedge reserves
Currency translation reserves
At 31 December
15.1
BANK
2016
$’000
2017
$’000
2016
$’000
23,017,298
1,340,812
(76)
(1,465,927)
22,892,107 20,259,830
1,331,175
–
(917,576)
20,673,429 11,856,185
1,383,127
–
(222,337)
13,016,975 11,330,145
1,381,210
–
(149,145)
12,562,210
1,331,175
–
173
5,894
3,570
1,340,812 1,328,862
–
–
5,630
(3,317)
1,331,175 1,381,210
–
–
5,894
(3,977)
1,383,127 1,114,562
264,335
–
5,630
(3,317)
1,381,210
GENERAL RESERVES
At 1 January
Arising from merger of subsidiaries
Transactions with non-controlling interests
DSP reserve from dividends on unvested shares
Transfer from/(to) unappropriated profits (Note 12)
At 31 December
The general reserves have not been earmarked for any specific purpose, and include merger reserves arising from common control
transactions, as well as dividends on unvested shares under the DSP.
15.2 CASH FLOW HEDGE RESERVES
The cash flow hedge reserves comprise the effective portion of the cumulative net change in the fair value of hedging instruments
used in cash flow hedges pending subsequent recognition of the hedged cash flow. The cash flow hedges principally consist of interest
rate contracts that are used to hedge against the variability in cash flows of certain floating rate liabilities.
15.3
CURRENCY TRANSLATION RESERVES
GROUP
2017
$’000
At 1 January
Movements for the year
Effective portion of hedge
At 31 December
(917,576)
(1,015,091)
466,740
(1,465,927)
BANK
2016
$’000
(997,822)
138,361
(58,115)
(917,576)
2017
$’000
(149,145)
(74,419)
1,227
(222,337)
2016
$’000
(161,658)
5,639
6,874
(149,145)
Currency translation reserves comprise exchange differences arising from the translation of the net assets of foreign operations and
the effective portion of the hedge on exposure in foreign operations.
Refer to Note 39.3 Currency risk – Structural foreign exchange risk for management of structural foreign exchange risk.
16. NON-CONTROLLING INTERESTS
GROUP
Note
Non-controlling interests in subsidiaries
Preference shares issued by a subsidiary
OCBC Capital Corporation (2008)
Total non-controlling interests
(a)
2017
$’000 2016
$’000
1,267,728 1,134,940
1,500,000
2,767,728 1,500,000
2,634,940
(a) OCBC Capital Corporation (2008) (“OCC2008”), a wholly-owned subsidiary of the Bank, issued the $1.5 billion non-cumulative non-
convertible guaranteed preference shares on 27 August 2008. The proceeds are on-lent to the Bank in exchange for a note issued by the
Bank [Note 21.1(e)], which guarantees on a subordinated basis, all payment obligations in respect of the preference shares. The preference
shares are redeemable in whole at the option of OCC2008 on 20 September 2018 and each dividend payment date thereafter. Dividends,
which are subject to declaration by the Board of Directors of OCC2008, are payable semi-annually on 20 March and 20 September each
year at 5.10% per annum up to 20 September 2018, and thereafter quarterly on 20 March, 20 June, 20 September and 20 December each
year at a floating rate per annum equal to the 3-month Singapore Swap Offer Rate plus 2.50% if the redemption option is not exercised.
The preference shares qualify as Additional Tier 1 capital for the Group.
188
OCBC ANNUAL REPORT 2017