Page 125 - Suncorp_Review

Suncorp Group Limited Annual Report 2010/11 123

31. Commitments

In the ordinary course of business, various types of contracts are entered into relating to the fnancing needs of customers. Commitments to extend credit, letters of credit, guarantees, warranties and indemnities are classed as fnancial instruments and attract fees in line with market prices for similar arrangements and refect the probability of default. They are not sold or traded. They are not recorded in the statement of fnancial position but are disclosed in the fnancial statements. The Suncorp Group uses the same credit policies and assessment criteria in making these commitments and conditional obligations as it does for on-balance sheet instruments.

31.1 Credit commitments

Detailed below are the notional amounts of credit commitments together with their credit equivalent amounts determined in accordance with the capital adequacy guidelines set out by APRA:

CONSOLIDATED

2011 2010 $m $m

Notional amounts

Guarantees entered into in the normal course of business 165 287 Commitments to provide loans and advances 6,062 6,046 6,227 6,333

Credit equivalent amounts

Guarantees entered into in the normal course of business 164 184 Commitments to provide loans and advances 1,252 1,457 1,416 1,641

31.2 Operating lease expenditure commitments

CONSOLIDATED

2011 2010 $m $m

Aggregate non-cancellable operating lease rental payable but not provided in the fnancial statements:

Less than one year 156 156 Between one and fve years 404 359 More than fve years 115 166 675 681

The Suncorp Group leases property under operating leases expiring from 1-12 years. Leases generally provide the Suncorp Group with a right of renewal at which time all terms are renegotiated. Lease payments comprise a base amount plus an incremental contingent rental. Contingent rentals are based on either movements in the Consumer Price Index or operating criteria. Some of the leased properties are sub-let by the Suncorp Group. Total future minimum rental receivable under non-cancellable sub-leases not provided in fnancial statements was $4 million (2010: $2 million).