Currency risk

Currency risk arises from the current and future performance of the Group as well as its equity being exposed to adverse changes in foreign exchange rates.

The Group’s currency risk is managed at the level of the Bank as the currency risk assumed by the subsidiaries is immaterial considering the nature of their business.

The objective of currency risk management is to protect the exchange gain and obtain financial benefits through transactions concluded in FX instruments on own account with the risk level accepted by the Bank.

Currency risk management process involves its measurement through:

• Calculation of the total position of the Bank;
• Calculation of the position in each currency;
• Calculation of Value at Risk (VaR);
• Stress tests.

The following table presented VaR level for currency risk in 2014 and as at 31 December 2014 and 31 December 2013.