3.18 Financial Guarantee Contracts
A financial guarantee contract is a contract that requires the issuer (the Group) to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the original or modified terms of a debt instrument.
Financial guarantee contracts are initially recognized at fair value. After initial recognition, financial guarantee contracts are measured at the higher of:
| • | The amount determined in accordance with IAS 37, Provisions, Contingent Liabilities and Contingent Assets and |
| • | The initial amount recognized, less, when appropriate, cumulative amortization recognized in accordance with IAS 18, Revenue. |