6 INVESTMENT RETURN.


Investment return includes fair value gains and losses, excluding fair value movements attributable to available-for-sale (AFS) investments, dividends, rent and interest. Dividends are accrued on an ex-dividend basis. Interest and rent are included on an accruals basis. Interest income for financial assets which are not classified as fair value through profit or loss (FVTPL) is recognised using the effective interest method.

The Group earns an investment return from holdings in financial instruments and property investments, held to back insurance and investment contracts on behalf of policyholders, and as Group capital.

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2011
£m

2010
£m

1.

Interest income of £71m (2010: £87m) arose on financial investments designated as AFS. There were no impairments on assets classified as AFS during the year (2010: £nil).

Dividend income

3,945

3,816

Interest income on financial investments at fair value through profit or loss

4,833

4,913

Other investment income/(expense)

49

(50)

Gains on financial investments at fair value through profit or loss

1,685

23,039

Gains on derivative instruments (designated as held for trading)

1,221

427

Realised gains on available-for-sale financial assets

43

19

Losses on loans and receivables

(7)

(4)

Financial investment return1

11,769

32,160

 

 

 

Rental income

334

327

Fair value gains on properties

40

184

Property investment return

374

511

Investment return

12,143

32,671

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