banco nacional ultramarino, s.a. 2011 - bnu · increase of gdp in real terms, driven mostly, by...
TRANSCRIPT
2011Annual Report
Banco Nacional Ultramarino, S.A.
Macau Economy
BNU HighlightsIncome and balance sheet
Income
Net interest income
Net income from commissions and other bank operations
Net operating income
Operating costs
Provisions
Proposal for allocation of the net profit
Balance sheet structure and change
Customer deposits
Amounts due from banks
Capital adequacy ratio
Activity OverviewRetail banking
Private banking & institutional clients
Corporate division
Large corporate division
Credit cards and acquiring business
Marketing
Human resources
Organization and systems
Treasury
Organization & procedures
Governing And Auditing Bodies
Financial Statements
Shareholders With Qualified Holdings
Equity Investments
Principal Accounting PoliciesGeneral
Significant accounting policies
Revenue recognition
Loans and advances to customers
Investments in securities
Off balance sheet financial derivative instruments
Properties and equipment
Leasing
The bank as lessee
Leasehold land and buildings
Impairment losses
Taxation
Foreign currencies
Retirement benefit costs
Provisions
Provisions for country risk
Cash and cash equivalent
Auditors’ Report
Opinion Of The Sole Supervisor
Most Important Addresses
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In 2011 Macau’s economy maintained its remarkable performance of past years, achieving a 20.7%
increase of GDP in real terms, driven mostly, by export of services, investment and private consumption
expenditure, in an environment of historically low interest rates.
The forecasted slowdown of the Chinese economy growth may have a negative impact in Macau, in view
of the fact that the territory, considered the world capital of the gaming industry, is highly dependent on
external factors, namely the number of tourists visiting the city, who in their majority come from Mainland
China.
Nevertheless, the Gaming and Tourism sectors, as well as all connected activities, have continued to grow
steadily, as these have shown a highly favorable behavior in 2011, with gross gaming revenues growing by
41.9% during the year. This is due mostly to an increase in visitors to the territory of 12.2% and a 6.5%
increase in visitor per capita expenditure, as per data collected in 2011.
The unemployment rate dropped to 2.1% at the end of 2011, confirming an almost full employment
situation.
In what refers to investment, for 2011, it was registered an increase of 14.5% to which investment in
construction rather than in equipment was a fundamental factor by its volume effect.
In this positive context in the local economy, the banking sector benefited from the strong economic
expansion registered in MSAR, although the banking business is in a more competitive environment
resulting in an immediate impact in profitability.
Macau Economy
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Banco Nacional Ultramarino S.A. represents the CGD Group in
Macao. It develops its activities in universal banking and is one of
the two Note Issuing Banks. BNU achieved a good performance in
terms of growth of business volume, benefiting from the favorable
economic conditions in the MSAR, even in spite of the referred
increased competition and its consequent impact in margins,
deposit growth and credit granting namely in housing loans.
In 2011, BNU’s business expanded by 13.2%, with a slight
advantage to growth in liabilities as opposed to assets, 13.3% to
13% respectively. The transformation ratio of deposits into credit in
2011 remained almost at the same level of 2010, at 52%.
In what regards net income, a decrease of 12.8% was registered,
mainly because of significant increase in generic and specific
provisions and a reduction in the net interest income.
The Net Operating Income decreased by 3.4% as a consequence
of the negative evolution of the net interest margin of 8.5%
(percentage variation of interest expense, higher than interest
income resulted from a more aggressive competition), was partially
mitigated by a growth of 5.2% in the complementary margin.
BNU Highlights
Income and Balance Sheet
Income
The highlights of the activity of BNU in 2011 were an increase of
the business volume and the expansion of the Bank’s operations in
several of its core business areas.
Interbank interest rates of almost zero also affected the Bank’s
profitability, given that its balance sheet is characterized by very high
liquidity levels.
Net income reached MOP 325.3 million in 2011, a decrease of
12.8% over MOP 373.1 million recorded in 2010, mainly due to a
significant increase in generic and specific provisions and a reduction
in the net interest income. Net operating income fell 3.4%, while
income from net commissions increased 2.9%.
Income from net commissions and other bank operations increased
by 5.5% in 2011.
Operational costs increased 1.9% in 2011, mainly due to higher
costs of third party services and supplies.
Provisions for lending were substantially higher in 2011, with net
provisions increasing 145.1% when compared with the previous
year.
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Net assets were, as of December 31st, 2011, MOP 34.1 billion, 7.8%
over the previous year, equivalent to MOP 2.5 billion.
The increase in total loans and advances resulted from an increase in
personal loans, housing loans and non-residents loans.
Return on equity (average) was 13.8%, a value lower than in 2010.
Return on assets (average) decreased from 1.2% in 2010 to 1.1% in
2011.
Net Interest Income
Net interest income was 8.5% lower than the previous year,
amounting to MOP 402 million, a decrease of MOP 37.2 million over
the MOP 439.2 million recorded in 2010.
In spite of the increase of 2.2% in interest income, the interest
expense also recorded an increase of 42.1%, because of the
increasing competition for customers deposits in the local market.
The prime rate remained unchanged at 5.25% throughout the year.
The decline in net interest margin was determined by higher
customer deposit interest rates, while near-zero interbank deposits
interest rates (recorded since 2009), continued to hamper the
profitability of the Bank’s financial resources.
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RESULTS (In thousands of MOP)
Change
2011 2010 In value In percentage
Net interest income 402,003 439,267 -37,264 -8.5
Net commissions income and other bank
operations
276,274 261,886 14,388 5.5
Net operating income 678,277 701,153 -22,876 -3.3
Operating costs 266,215 261,258 4,957 1.9
Cash flow 441,230 470,816 -29,586 -6.3
Net profit before provisions 412,062 439,895 -27,833 -6.3
Net income 325,347 373,141 -47,795 -12.8
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Net income from commissions and other bank operations
Net income from commissions and other bank operations, including
financial operations, increased 5.5% in 2011, amounting to MOP
276.3 million, an increase of MOP 14.4 million from 2010.
The main components of net income from commissions and other
bank operations had the following evolution:
• Netprofitsinfinancialtransactionsincreased1%,reflectingan
increase in foreign exchange transactions volumes.
• Netincomefromcommissionsandfeesandnetincome
from other bank operations increased 6.9%, due, namely,
to the increase of credit card related commissions and credit
commissions.
• Netincomefromcommissionsplusnetincomefromotherbank
operations, and net income in financial transactions represented,
respectively, 77.4% and 22.6% of total net income from
commissions and other bank operations (76.4% and 23.6% in
2010).
Net operating income
The changes in net interest income resulted in a decrease of 3.4%
in net operating income, totaling MOP 678.3 million in 2011, a
decrease of MOP 22.8 million when comparing with the previous
year.
Net interest income represented 59.3% of the net operating
income in 2011, a value slightly lower compared with 2010, while
the weight of the net income from commissions and other bank
operations reached 40.7% (37.3% in 2010).
Net Operating Income Structure
( % )
2011
59.3
31.5
9.2
62.6
28.5
8.8
2010
Financial Operations Net Income
Net Commissions & Other Income
Net Interest Income
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Operating Costs
The operating costs (including depreciations) increased 1.9% in
2011, a value below the inflation rate, which stood at 5.8 percent in
the same period.
In this context, operating costs rose MOP 5 million in 2011, totaling
MOP 266.2 million.
The main aggregates of operating costs composition are as follows:
• Staffexpenseswentup0.6percent,totalingMOP159.5million,
reflecting an increase in salaries and other remuneration, as well
as social costs.
• Thirdpartysuppliesandservicesrose8.1%,reachingMOP77.5
million.
• Depreciationdecreased5.7%.
Staffexpensesrepresented,in2011,60%oftotaloperatingcosts
(60.7%in2010),thirdpartysuppliesandservices29.1%(27.5%in
2010) and depreciation 11% (11.8% in 2010).
Provisions
Net provisions reached MOP 42.4 million in 2011, a value higher
thanMOP17.3millioncreatedin2010,duetoasignificantincrease
ingenericandspecificprovisions.
• Overduecreditcorrespondsto1.7%ofthecreditportfolio.
• Provisionsforpersonalcredit,includingcreditcards,mortgage
andpersonalloansstillmaintainedverylowlevels.
Proposal for Allocation of the Net Profit
Underthelegalandstatutoryterms,itissubmittedtotheapproval
oftheAnnualGeneralAssembly,thatthenetprofitof
MOP325,346,668.21isallocatedasfollows:
• Forlegalreserves,accordingtoart.60oftheMacauFinancial
SystemAct:MOP32,534,666.82
• Fordistributionofdividendstoshareholders:
MOP162,673,334.11
• RemainingBalance:MOP130,138,667.28
BNUHighlights
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Balance Sheet Structure
BNU maintained a solid balance sheet in 2011, with adequate levels
of liquidity, profitability and efficiency.
The Bank’s assets recorded a positive evolution in 2011, with an
increase in loans and in interbank placements, in line with the
expansion of BNU’s deposits portfolio.
Net assets were, as of December 31st, 2011, MOP 34.1 billion, an
increase of 7.8%, comparing with the previous year.
Total loans and advances increased 13%, reaching MOP 13.8 billion,
representing 40.6% of net assets (38.8% in 2010).
Customer deposits increased 13.3% in 2011, rising from MOP 23.6
billion in 2010, to MOP 26.7 billion in 2011.
In view of these developments, the average residents’ loan-to-
deposits ratio increased from 47.88% in 2010 to 50.29% in 2011.
Interbank placements, high liquidity assets, represented, at the end
of 2011, 31.8% of total net assets, an increase of 5.3% over 2010.
These assets increased 29.4%, totaling MOP 10,854 million.
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Structure of Net Assets Increase in Net Assets, 2010/2011
Interbank placements
Credit granted to clients
Cash, fixed assets and other assets
34,188 Bl MOP in%in %
27.6%
40.6%
31.8%
-14.3%
13.0%
29.4%
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Customer Deposits
As of December 2011, total deposits reached MOP 26.7 billion, an
increase of 13.3% over the previous year, while Macau residents’
deposits went up 13.9%.
Current and savings deposits increased 2.7%, representing, at the
end of 2011, 51.7% of total deposits (57.1% at the end of 2010).
Time deposits amounted to MOP 12.9 billion as of December 31,
2011, a rise of 27.5%, representing 48.3% of total deposits (43% at
the end of 2010), driven upwards by the Bank’s strong cross selling,
and competitiveness, in a context of increasing savings in Macau.
Amounts Due From Banks
Given its high-liquidity situation, the Bank very rarely fund its activity
through the interbank market.
Amounts due from banks totaled MOP 899 million, a decrease of
57.1%, corresponding to a decrease of MOP 1,2 billion over 2010,
representing only 2.6% of total liabilities.
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Structure of Liabilities and Shareholders´ Equity Increase/decrease in Liabilities and Shareholders´ Equity - 2011/2012
Resources from banks
Clients deposits
Provisions for general risks
Other liabilities
Equity
34,188 Bl MOP in%2.6%
78.2%
0.5%11.7%
7.0%
-57.1%
-0.4%
13.3%
10.0%
15.2%
in %
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Capital Adequacy Ratio
Total capital was, as of December 31st, 2011, MOP 2,389 million, a value below the MOP 2,399 million of
2010.
In view of these developments, the capital adequacy ratio, calculated in accordance with AMCM Notices
no. 012/93-AMCM and 013-AMCM of August 27th, 2003 and also Circulars no. 003/A/94 and 004/A/94,
stood at 13.97% in 2011, dropping 2.57 percentage points from 2010.
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Pursuing the goal of having BNU fully exploring the business
opportunities arising from Macau’s economic development, the
Bank initiated in the last quarter of 2011 a transformation process,
also called “BNU Checkup Project”. The project has 11 different
but complementary categories with 48 initiatives that will be
progressively developed under the guidance of Team Leaders that
have the responsibility of the implementation of all the actions
defined in a Plan of Execution.
The model of management established by the Project includes
constant monitoring by a Program Management Office (PMO) that
has the responsibility of coordinating all the planned initiatives.
Any deviation or delay is duly noted, and appropriate corrections
implemented upon due analyses and decisions, so the defined
calendar can be achieved. The first results of the implementation of
the transformation project are expected to occur during the first half
of 2012.
Retail Banking
The year of 2011 was characterized by a significant increase on the
credit production and outstanding, particularly on car loans. The
increase in Housing Loans was achieved through more intensive
price discrimination and increased cross-selling which allowed BNU
to resist to the competition pressures and strengthen the role of this
product as a loyalty factor.
Activity Overview
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Private Banking & Institutional Clients
Being the pioneer of Macau Private Banking services, business
activities of BNU Private Banking Department is growing with a solid,
pro-active, sustainable development model since 1994. In 2011,
thanks to clients trust, assets under management grew more than
25% and other main business lines grew at double digits. With new
positioning and orientation of clientele as well as business resources,
the Department was renamed as Private Banking and Institutional
Clients.12
Corporate Division
This Division in 2011 continued developing the relationship with
clients, especially the more relevant ones, like contractors, basking
in the growing economy of Macao boosted by the overall prosperity
brought about by the gaming industry. That was achieved amidst the
intense competition in the banking industry and lifts BNU to expand
its presence in target markets in 2012.
Large Corporate Division
BNU has a special unit to handle the gaming sector customers,
providing them with tailor-made services in the areas of cash
management, card acquiring business, payroll, ATM and online
banking services. BNU is actively participating in loans syndication to
fund the casino and hospitality development. Under the competitive
market of 2011 the Bank maintained a positive evolution in this
business area. Market response and customer needs are always the
first priority in the agenda.
Credit Cards And Acquiring Business
The card business evolution was positive in 2011. Compared with
2010, acquiring business volume has increased 3% and issuing
business volume has increased 14%. BNU is expanding and
enhancing products and services to both merchants and cardholders
in order to maintain the excellent service level provided by the Bank.
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Marketing
BNU has launched a credit card privilege platform BNU Life in the
first quarter of 2011. This platform aims at increasing cardholders’
loyalty and improve merchants’ business by bringing cardholders to
their establishments.
Regarding community responsibilities, BNU continues to support
those who are physically and mentally challenged and those who
are dependent on chemical substances. A priority is also given to
higher education by providing scholarship programs to major higher
education institutes.
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Human Resources
In line with the new organizational model, key capabilities required for the new areas were defined and
team members were selected either through internal or external recruiting campaigns. A sales strategy was
laid down to maximize the efficiency of the sales force. It entailed staff transfer, training, motivation and
system development.
A new Performance Appraisal system was implemented to differentiate the outstanding staffs for
recognition, attract new talents and to promote a high performance culture throughout the Bank.
Organization And Systems
Several IT projects were completed in response to requirements of new products and services. After 18
months of planning and preparation, the core banking system was upgraded to its latest version through
which we can provide more diversified banking products that suit different customers’ needs. The security
of online banking service is a main concern, so the respective networking infrastructure was renovated to
ensure a more stable and secure environment for customers to have access to the banking services at their
fingertips. To meet customers’ needs for RMB banking services, various services were launched, such as a
RMB, MOP and HKD multi-currency debit card with several accounts in different currencies embedded in a
single card, and the opening of accounts and the execution of transactions in RMB were features added to
our online banking services.
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Treasury
Against the background of a worsening financial markets situation and a widespread reduction of credit
ratings, the activity of the Treasury Division was guided by the need to maintain strong liquidity levels with
minimal risk exposures whilst ensuring that returns on liquidity were kept at adequate levels. Competition
for customer deposits and financial products offering amongst the banking industry in Macau intensified
in 2011 prompting BNU to supply its customers with competitive pricing and wider choice of products. Of
note in 2011 was the drawing and implementation of a Liquidity Management Policy in accordance with
regulatory requirements.
Organization & Procedures
The major project in 2011, and the one that occupied more resources, was the ICBS system upgrade,
successfully implemented in July 2011. Also the Operational Risk and Internal Control project
implementation has significantly evolved. Additionally, the department also cooperated with other units
for the launching of new products and services, by drafting the respective workflow and procedures,
performing system tests and granting training, whenever necessary. The same is applicable to the working
processes optimization.
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Governing and Auditing Bodies
Board Of The General Meeting
Chairman: Joaquim Jorge Perestrelo Neto Valente
Vice-Chairman: Liu Chak Wan
Board Of Directors
Chairman: CAIXA GERAL DE DEPÓSITOS, S.A.,
Represented by Rodolfo Vasco Castro Gomes Mascarenhas Lavrador
Vice-Chairman: Pedro Manuel de Oliveira Cardoso
Artur Jorge Teixeira Santos
Up to 10th August 2011
Members: Herculano Jorge de Sousa
António Luís Neto
Kan Cheok Kuan
Emílio Carlos Monteiro Nunes de Castro
Pedro Miguel Canales Escudero
Since 16th November 2011
Executive Committee
President: Pedro Manuel de Oliveira Cardoso
Since 10th August 2011
Artur Jorge Teixeira Santos
Up to 10th August 2011
Members: Kan Cheok Kuan
Pedro Miguel Canales Escudero
Since 16th November 2011
Emílio Carlos Monteiro Nunes de Castro
Up to 16th November 2011
SOLE SUPERVISOR Chui Sai Cheong
COMPANY’ SECRETARY Maria de Lurdes Nunes Mendes da Costa
Gov
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Banco Nacional Ultramarino, S.A.
Balance Sheet as of December 31, 2011
MOP
Assets Gross assets
Provisions,
amortizations Net assets
Cash 2,730,428,747.28 0.00 2,730,428,747.28
Deposits with amcm 417,705,868.65 0.00 417,705,868.65
Debt certificates issued by the macau government 3,336,551,055.00 0.00 3,336,551,055.00
Accounts receivable 157,891,059.31 0.00 157,891,059.31.9
Deposits with other credit institutions in macau 220,333,827.75 0.00 220,333,827.75
Deposits with other credit institutions abroad 1,352,278,648.97 0.00 1,352,278,648.97
Gold and silver 0.00 0.00 0.00
Other current assets 2,647,337.95 0.00 2,647,337.95
Credit granted 14,004,989,080.80 240,990,296.30 13,763,998,784.50
Placements with credit institutions in macau 2,141,600,000.00 0.00 2,141,600,000.00
Deposits at call and time deposits with credit institutions abroad 8,713,264,326.10 0.00 8,713,264,326.10
Shares, bonds and quotas 564,881,833.74 0.00 564,881,833.74
Investment of assigned funds 0.00 0.00 0.00
Debtors 129,388,189.13 0.00 129,388,189.13
Other placements 0.00 0.00 0.00
Financialinvestments 8,940,172.67 0.00 8,940,172.67
Property 796,519,860.43 47,023,326.60 749,496,533.83
Equipment 107,341,298.50 84,661,232.92 22,680,065.58
Deferred cost 58,663,460.54 33,711,984.94 24,951,475.60
Start-up expenditure 0.00 0.00 0.00
Fixedassetsinprogress 0.00 0.00 0.00
Other fixed assets 1,777,156.65 0.00 1,777,156.65
Internal and adjustment accounts 148,528,191.21 0.00 148,528,191.21
Total 34,893,730,114.68 406,386,840.76 34,487,343,273.92
Financial Statements
FinancialStatements
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Banco Nacional Ultramarino, S.A.
Balance Sheet as of December 31, 2011
MOP
Liabilities Sub-total Total
Bank notes in circulation 3,463,818,120.00
Current deposits 10,666,541,577.22
Deposits at call 0.00
Time deposits 9,305,979,131.21 19,972,520,708.43
Government deposit 6,753,510,312.10
Amounts due to credit institutions in macau 631,748,517.59
Amounts due to other local entities 0.00
Amounts due to credit institutions abroad 267,639,346.96
Assigned funds 0.00
Payable bank cheques 709,265.31
Creditors 164,029,814.40
Other liabilities 73,459,703.00 7,891,096,959.36
Internal and adjustment account 0.00 332,267,299.04
Provisions for risk 0.00 165,139,160.90
Capital 400,000,000.00
Other reserves 1,937,154,357.98 2,337,154,357.98
Net profit brought forward 0.00
Net profit for the year 325,346,668.21
Total 34,487,343,273.92
FinancialStatements
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Banco Nacional Ultramarino, S.A.
Balance Sheet as of December 31, 2011
MOP
Memorandum accounts Amount
Values received for safe keeping 85,775,631.54
Bills for collection 8,814,040.28
Securities receive 149,192,305,173.99
Garantees on account of customers 2,544,749,152.25
Letters of credit outstanding 40,708,837.75
Bills and acceptances available for discount 0.00
Securities deposited 5,603,290.00
Forwardforeignexchangepurchases 1,227,033,379.00
Forwardforeignexchangesales 1,226,673,453.00
Other memorandum accounts 6,270,221,866.97
Of which: public treasury-current account 126,176,744.28
FinancialStatements
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Banco Nacional Ultramarino, S.A.
Profit and Loss Account for the Year 2011
Income statement
(MOP) (MOP)
Debit Amount Credit Amount
Interest expense 165,006,834.46 Interest income 566,286,604.29
Staff cost 159,501,231.68 Bank operations income 349,708,527.19
Of which:
remuneration of board of directors and
supervisor committee
6,446,949.80
Other bank operating income 62,529,145.48
Salaries and wages 127,933,100.50 Incomes from securities and financial investment 723,001.38
Benefits 23,245,034.91 Other bank income 37,656,018.05
Other 1,876,146.47 Non-banking income 10,045,345.54
Third party supply expenses 8,693,167.77 Operating losse 0.00
Third party service expenses 68,852,008.66
Ther bank costs 184,022,269.04
Taxes 527,702.00
Non-banking expenses 2,146,333.37
Depreciations 29,168,135.71
Provisions 55,270,180.53
Operating income 353,760,778.71
Total 1,026,948,641.93 Total 1,026,948,641.93
FinancialStatements
20
Banco Nacional Ultramarino, S.A.
Profit and Loss Account for the Year 2011
Profit and loss accounts
(MOP) (MOP)
Debit Amount Credit Amount
Operating loss 0.00 Operating income 353,760,778.71
Loss from previous years 53,028,608.35 Income from previous 15,862,184.50
Extraordinary loss 0.00 Extraordinary income 0.00
Income tax 44,276,295.00 Provisions used 53,028,608.35
Profit for the year 325,346,668.21 Loss for the year 0.00
Total 422,651,571.56 Total 422,651,571.56
Head of Accounting President of Executive Committee
Maria Clara Fong Pedro Manuel De Oliveira Cardoso
FinancialStatements
21
Shareholders with Qualified Holdings
AccordingtotheFinancialSystemActofMacau,aqualifiedholdingisthatwhich,eitherdirectlyorindirectly,represents10percentormoreof
the share capital or voting rights, or any other form which confers the possibility to exercise a significant influence over the management of the
institution.
Shareholders with a qualified holding:
• CaixaGeraldeDepósitos,S.A.-----------------------97.13%
Shar
ehol
ders
with
Qua
lified
Hol
ding
s
22
List of the companies where Banco Nacional Ultramarino has equity holdings higher than 5 percent of the respective issued quoted capital or
higher than 5 percent of the own resources, and respective percentual value:
• None.
Equity Investments
23
General
Banco Nacional Ultramarino, S.A. incorporated in Macau Special
Administrative Region, the People’s Republic of China (“Macau
SAR”), is a licensed bank authorized under the rules issued by the
Autoridade Monetária de Macau (“AMCM”). The holding company
of the Bank is Caixa Geral de Depósitos, S.A., incorporated in
Portugal. The principal activities of the Bank are the provision of
banking and related financial services. The address of the registered
office of the Bank is Av. Almeida Ribeiro, Nº 22, Macau.
The financial statements are presented in Macau Pataca (“MOP”),
which is the same as the functional currency of the Bank.
Significant Accounting Policies
The financial statements have been prepared on the historical cost
basis except for certain properties that are measured at revalued
amounts, as explained in the accounting policies set out below.
The financial statements have been prepared in accordance with
“NormasdeRelatoFinanceiro”(“FinancialReportingStandardsof
Macau SAR”).
Revenue Recognition
Interest income is recognized in the income statement as it is
accrued on a time basis, except in the case of non-accrual loans
and advances to customers where interest is credited to a suspense
account, and is not recognized in the income statement.
Non-accrual loans and advances to customers represent the credit
exposures which are overdue for more than 3 months. Interest
income from non-accrual loans and advances to customers is directly
credited to profit or loss when the interest is subsequently recovered.
Feesandcommissionincomearerecognizedwhenservicesare
provided.
Dividend income from investments in equity securities is recognized
when the shareholder’s right to receive payment has been
established.
Loans and advances to customers
Loans and advances to customers are stated in the balance sheet
after deducting specific and general provisions for possible losses.
Provisions are made against specific advances when management
has doubts on the ultimate recoverability of principal or interest.
Specific provisions is made to reduce the carrying amount of loans
and advances to customers, net of any collateral, to the expected net
realizable value based on management’s assessment of the potential
losses on those identified advances, and with reference to the
requirements of AMCM. The provisions are reviewed periodically and
adjustments are made when considered necessary by management.
Amounts have been set aside as a general provision for loans
and advances to customers with reference to the requirements of
AMCM.
When there is no realistic prospect of recovery, the outstanding loans
and advances to customers are written off.
Principal Accounting Policies
Prin
cipa
l Acc
ount
ing
Polic
ies
25
Investments in securities
Investments in unlisted equity securities are carried at cost less any
identified impairment loss.
Investments in debt securities are carried at amortized cost less any
identified impairment loss.
An impairment loss is recognized in profit or loss when there is
objective evidence that the asset is impaired, and is measured as the
difference between the asset’s carrying amount and the recoverable
amount estimated by management. Impairment losses are reversed
in subsequent periods when an increase in the investment’s
recoverable amount can be related objectively to an event occurring
after the impairment was recognized, subject to the restriction that
the carrying amount of that asset at the date the impairment is
reversed does not exceed what the cost would have been had the
impairment not been recognized.
Off balance sheet financial derivative instruments
Financialderivativeinstrumentsincludinginterestrateswaps,
forward foreign exchange contracts and foreign exchange swap
contracts are used primarily to hedge the Bank’s exposures to
interest rate and foreign exchange risks, arising from operational,
financing and investment activities.
The interest arising from the interest rate derivative instruments
is recognized in the income statement as the interest income
or expense received and receivable or paid and payable during
the period. The gain or loss arising from the settlement and on
retranslation at the spot rates prevailing on the balance sheet date of
foreign exchange derivative instruments is recognized in profit or loss
in the period in which they arise. The financial derivative instruments
are recorded off balance sheet.
Properties and equipment
Properties and equipment held for use in the supply of services
or for administrative purposes are stated at cost or deemed cost,
as appropriate, less subsequent accumulated depreciation and
accumulated impairment losses.
The Bank has decided to adopt the revaluation model for land
and buildings as at 31 December 2011. Land and buildings held
for use in the supply of services or for administrative purposes are
stated in the balance sheet at their revalued amounts, being the fair
value at the date of revaluation less any subsequent accumulated
depreciation and any subsequent accumulated impairment losses.
Revaluation is performed with sufficient regularity such that the
carrying amount does not differ materially from that which would be
determined using fair value at the end of the reporting period.
Any revaluation increase arising on revaluation of land and buildings
is recognized and accumulated in the revaluation reserve, except to
the extent that it reverses a revaluation decrease of the same asset
previously recognized in profit or loss, in which case the increase
is credited to profit or loss in the extent of the decrease previously
charged. A decrease in net carrying amount arising on revaluation of
an asset is recognized in profit or loss to the extent that it exceeds
the balance, if any, on the revaluation reserve relating to a previous
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revaluation of that asset. On the subsequent sale or retirement of a
revalued asset, the attributable revaluation surplus is transferred to
retained profits.
Depreciation is provided to write off the cost of items of properties
and equipment over their estimated useful lives and after taking
into account their estimated residual value, using the straight-line
method.
An item of property and equipment is derecognized upon disposal
or when no future economic benefits are expected to arise from the
continued use of the asset. Any gain or loss arising on derecognition
of the asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the item) is included in the
income statement in the year in which the item is derecognized.
Leasing
Leases are classified as finance leases whenever the terms of the
lease transfer substantially all the risks and rewards of ownership to
the lessee. All other leases are classified as operating leases.
The Bank as lessee
Rentals payable under operating leases are charged to profit or loss
on a straight-line basis over the term of the relevant lease. Benefits
received and receivable as an incentive to enter into an operating
lease are recognized as a reduction of rental expense over the lease
term on a straight-line basis.
Leasehold land and buildings
The land and building elements of a lease of land and building are
considered separately for the purpose of lease classification, unless
the lease payments cannot be allocated reliably between the land and
building elements, in which case, the entire lease is generally treated
as a finance lease and accounted for as properties and equipment.
Impairment
At each balance sheet date, the Bank reviews the carrying amounts
of its assets to determine whether there is any indication that those
assets have suffered an impairment loss. If the recoverable amount
of an asset is estimated to be less than its carrying amount, the
carrying amount of the asset is reduced to its recoverable amount.
An impairment loss is recognized as an expense immediately.
Where an impairment loss subsequently reverses, the carrying
amount of the asset is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does
not exceed the carrying amount that would have been determined
had no impairment loss been recognized for the asset in prior
years. A reversal of an impairment loss is recognized as income
immediately.
Taxation
Income tax expense represents the sum of the tax currently payable
and deferred tax.
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The tax currently payable is based on taxable profit for the year.
Taxable profit differs from profit as reported in the income statement
because it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are never
taxable or deductible. The Bank’s liability for current tax is calculated
using tax rates that have been enacted or substantively enacted by
the balance sheet date.
Deferred tax is recognized on temporary differences between the
carrying amounts of assets and liabilities in the financial statements
and the corresponding tax base used in the computation of taxable
profit, and are accounted for using the balance sheet liability
method. Deferred tax liabilities are generally recognized for all
taxable temporary differences and deferred tax assets are recognized
to the extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilized. Such
assets and liabilities are not recognized if the temporary difference
arises from goodwill or from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction
that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or
part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset realized.
Deferred tax is charged or credited to profit or loss.
Deferred tax assets and liabilities are measured at the tax rates that
are expected to apply in the period in which the liability is settled or
the asset is realized, based on tax rate (and tax laws) that have been
enacted or substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax
consequences that would follow from the manner in which the Bank
expects, at the end of the reporting period, to recover or settle the
carrying amount of its assets and liabilities.
Current and deferred tax is recognized in profit or loss, except when
it relates to items that are recognized directly in equity, in which
case, the current and deferred tax are also recognized directly in
equity respectively.
Foreign currencies
In preparing the financial statements of the entity, transactions in
currencies other than the functional currency of that entity (foreign
currencies) are recorded in the functional currency (i.e. the currency
of the primary environment in which the entity operates) at the
rates of exchanges prevailing on the dates of the transactions. At
each balance sheet date, monetary items denominated in foreign
currencies are retranslated at the rates prevailing on the balance
sheet date. Non-monetary items that are measured in terms of
historical cost in a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary items,
and on the translation of monetary items, are recognized in profit or
loss in the period in which they arise.
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Retirement benefit costs
Payments to defined contribution retirement benefit plans are charged as an expense when employees
have rendered service entitling them to the contributions.
Provisions
Provisions are recognized when the Bank has a present obligation as a result of a past event, and it is
probable that the Bank will be required to settle that obligation. Provisions are measured at management’s
best estimate of the expenditure required to settle the obligation at the balance sheet date, and are
discounted to present value where the effect is material.
Provision for Country Risk
Provision for country risks is assessed for cross-border exposures with reference to the requirements of
AMCM.
Cash and Cash Equivalents
Forthepurposesofthecashflowstatement,cashandcashequivalentscomprisecashandshort-
term funds, including cash, deposits with AMCM and current accounts with banks and other financial
institutions.
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To the shareholders of Banco Nacional Ultramarino, SA
We have audited the financial statements of the Banco Nacional Ultramarino, SA for the year ended December 31, 2011, in accordance with the
“Normas de Auditoria” and “Normas Técnicas de Auditoria” of the Macao Special Administrative Region. In our report, dated March 21, 2012,
we expressed an opinion with no constraints on the financial statements of which the present is a summary.
The financial statements referred to above comprise the balance sheet, as at 31 December 2011, the income statement, the statement
of changes in equity and statement of cash flows for the year ended, as well as a summary of the relevant accounting policies and other
explanatory notes.
The summarized financial statements prepared by management results from the annual audited financial statements mentioned above. In our
opinion, the summarized financial statements are consistent in all material respects with the audited financial statements.
To better understand the financial position of Banco Nacional Ultramarino, SA and the results of its operations in the period and scope covered
by our audit, the summarized financial statements should be read in conjunction with the financial statements of which they result, as well as
with the corresponding audit report.
Quin Va
Auditor
Deloitte Touche Tohmatsu – Sociedade de Auditores
Macau, 21 March 2012
Auditors’ Report
Aud
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30
Aud
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31
Shareholders:
In accordance with article 32 e) of the Articles of Association, the Board of Directors of Banco Nacional Ultramarino, S.A. submitted to the Sole
Supervisor, the Balance Sheet, Accounts and annual Report in relation to the bank’s operation in year 2011. In addition, the external auditor’s
report as prepared by «Deloitte Touche Tohmatsu» for the bank in relation to its activity in same year was also provided.
During the year, the Sole Supervisor had maintained regular contacts with the Board of Directors, consulted on the bank’s activity and always
received the collaboration as well as necessary clarification in an efficient manner.
After reviewing the documents as presented by the Board of Directors, it was found that the documents reflected clearly the financial and
economical situation of the Bank.
The Report of the Board of Directors also explained clearly the business development of the bank’s activity in the referred year of operation.
The Sole Supervisor had also reviewed the external auditors’ report and found that the report reflected truly the financial situation and
performance of the bank as at close of business on 31st. December 2011, as well as the result of the activity for the year ended and which were
prepared under the accounting principles applicable on banking activity.
As such, the Sole Supervisor decided to recommend the approval of:
1. The balance sheet and profit and loss account;
2. The annual report of the Board of Directors.
Macau, March 28, 2012
The Sole Supervisor
Chui Sai Cheong
Opinion of the Sole Supervisor
Opi
nion
of
the
Sole
Sup
ervi
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32
Most Important Addresses
Caixa Geral De Depósitos Av. João XXI, 63
1000-300 Lisboa
Tel.:217953000 Fax:217905051
http://www.cgd.pt
Swift: CGDIPTPLXXX
Banco Nacional Ultramarino, S.A. Head Office
Av. Almeida Ribeiro, nº. 22
Tel.:28355111 Fax:28355653
Telex:88202BNUMCOM88606BNUFXOM
E-mail: [email protected]
http://www.bnu.com.mo
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Tel.:28335533 Fax:28713119
Mos
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BNU Branch Network
Main Branch Av. Almeida Ribeiro, 22
Tel.:28355111 Fax:28355130
Mercado Vermelho Av. Almirante Lacerda, Nº. 90-92
Telef.:28371166 Fax:28211619
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Telef.:28572259 Fax:28933200
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Edf.ChongFuR/C
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Jardim Brilhantismo, R/C, A
Tel.: 2872 3672; 2872 3676
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Cotai Shop Nº 2466ª, The Grand Canal Shoppes,
The Venetian Macao Resort Hotel,
Estrada da Baía de N. Senhora da Esperança,
The Cotai Srip, Taipa, Macau
Tel. 2857 6001, 2857 6002
Fax28576603
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R/C Edf. Teng Pou Kok
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Taipa
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35
