Financial statements
Notes to the financial statements
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11 Movements in the fair value of derivatives
| 2007 £m |
2006 £m |
|
|---|---|---|
| Forward foreign exchange contracts | 1 | (3) |
| Currency swaps | – | 6 |
| Interest-rate swaps | 32 | (6) |
| Derivative element of Convertible Bonds | (62) | (75) |
| (29) | (78) |
Further information on interest-rate swaps is provided in note 19. Expectations regarding sterling interest rates, together with the closing out of certain long-dated swaps, have had a beneficial impact on the fair value of interest-rate swaps in the year, resulting in a profit in the income statement.
Further information on 3i's Convertible Bonds is provided in note 21. The fair value of the equity element of 3i's Convertible Bonds has decreased, mainly due to the increase in 3i's share price in the year, and this loss has been recognised in the income statement.