BANCO SANTANDER CHILE | CIK:0001027552 |

ifrs-full:DisclosureOfAvailableforsaleAssetsExplanatory

NOTE 10 AVAILABLE FOR SALE INVESTMENTS

As of December 31, 2017 and 2016,detail of instruments deemed as available for sale investments is as follows:

As of December 31, 2017 and 2016, the line item Chilean central bank and government securities item includes securities sold under repurchase agreements to clients and financial institutions for Ch$241,995 and Ch$155,044 million, respectively. Additionally, as of December 31, 2017 and 2016, this instruments guarantee derivatives transactions through Comder Contraparte Central S.A. for Ch$42,910 and Ch$18,627, respectively.

As of December 31, 2017 and 2016, the line item Other Chilean securities includes securities sold to customers and financial institutions under repurchase agreements totaling Ch$1,156 and Ch$57,393 million, respectively.

As of December 31, 2017 and 2016, the line item Foreign financial securities item includes securities sold under repurchase agreements to clients and financial institutions for Ch$24,910 and Ch$0 million, respectively. Additionally, this instruments guarantee derivatives transactions through London Clearing House (LCH) for Ch$48,106 and Ch$0 million respectively. In order to comply with the initial margin specified in the European EMIR standard, the Bank maintained securities in guaranteed with Euroclear for Ch$33,711 million and Ch$ 0 million respectively.

As of December 31, 2017 available for sale investments included a cumulative net unrealized income of Ch$1,855 million, recorded as a “Valuation adjustment” in Other comprehensive income, distributed between Ch$459 million attributable to the equity holders of the Bank and Ch$1,396 million attributable to non-controlling interest.

As of December 31, 2016 available for sale investments included a cumulative net unrealized loss of Ch$7,375 million, recorded as a “Valuation adjustment” in Other comprehensive income, distributed between Ch$6,449 million attributable to the equity holders of the Bank and Ch$926 million attributable to non-controlling interest.

Gross profits and losses realized on the sale of available for sale investments as of December 31, 2017, 2016 and 2015, are as follows:

The Bank evaluated those instruments with unrealized losses as of December 31, 2017 and 2016 and concluded they were not impaired. This review consisted of evaluating the economic reasons for any declines, the credit ratings of the securities’ issuers, and the Bank’s intention and ability to hold the securities until the unrealized loss is recovered. Based on this analysis, the Bank believes that there were no significant or prolonged declines nor changes in credit risk which would cause impairment in its investment portfolio, since most of the decline in fair value of these instruments was caused by market conditions which the Bank considers to be temporary. All of the instruments that have unrealized losses as of December 31, 2017 and 2016, were not in a continuous unrealized loss position for more than one year.

The following charts show the available for sale investments cumulative unrealized profit and loss, as of December 31, 2017 and 2016:

As of December 31, 2017:

As of December 31, 2016: