The Group designates debt and marketable equity securities as either held for trading purposes or available for sale at the date of acquisition.
Trading assets and trading liabilities are carried at their fair values and related realized and unrealized gains and losses are included in trading revenues .
Securities available for sale are carried at fair value with the changes in fair value reported in accumulated other comprehensive income within shareholders' equity unless the security is subject to a fair value hedge, in which case changes in fair value resulting from the risk being hedged are recorded in other revenues. The amounts reported in other comprehensive income are net of deferred income taxes and adjustments to insurance policyholder liabilities and deferred acquisition costs.
Declines in fair value of securities available for sale below their amortized cost that are deemed to be other than temporary and realized gains and losses are reported in the Consolidated Statement of Income in net gains on securities available for sale. The amortization of premiums and accretion of discounts are recorded in interest revenues. Generally, the weighted-average cost method is used to determine the cost of securities sold.
Fair value is based on quoted market prices, price quotes from brokers or dealers, or estimates based upon discounted expected cash flows.