Note 26 - Financial instruments

Cash flow hedges

The table below shows the derivatives that the Group has contracted to hedge currency exposure or interest rate exposure to expected future cash flows. The total fair value adjustment at year-end is entered directly in Shareholders' equity and will be taken to the income statement as the financial contracts are realized, with the exception of currency translation and accrued interest on currency swaps used for interest hedging, as these do not qualify as cash flow hedges and are therefore entered directly in the income statement (DKK 171 million in 2007, compared with DKK (82) million in 2006).


	2007		2006
DKK million	Contract amount based on agreed rates	Market value Dec. 31	Contract amount based on agreed rates	Market value Dec. 31

Forward exchange contracts (sales)
JPY	84	2	107	6
	84	2	107	6
Currency options (purchased put options)
USD	972	60	824	31
	972	60	824	31
Interest rate swap
USD/USD - pays fixed rate of 3.73% / earns variable rate of 5.38% (compared with 5.36% in 2006)	244	1	244	7
CAD/CAD - pays fixed rate of 6.77% / earns variable rate of 6.16%	22	(1)	-	-
	266	-	244	7
Currency swaps
EUR/DKK - pays fixed rate of 4.27% / earns variable rate of 4.93% (compared with 3.88% in 2006)	250	1	250	(4)
EUR/USD - pays fixed rate of 3.84% / earns variable rate of 4.91% (compared with 5.37% in 2006)	527	(100)	527	(52)
EUR/USD - pays fixed rate of 4.03% / earns variable rate of 4.86% (compared with 5.37% in 2006)	384	(58)	384	(24)
	1,161	(157)	1,161	(80)

	2,483	(95)	2,336	(36)

There are no ineffectiveness in cash flow hedging due to 100% hedge accounting.

The forward exchange contracts and currency options fall due in the period January 2008 to December 2008 (January 2007 to December 2007 at the end of 2006), while the interest rate and currency swaps fall due in the period June 2009 - July 2017 (June 2009-March 2013 at the end of 2006).

The Group's expected future net cash flows in USD and JPY are hedged as follows:

			2007	2006

USD			12 months	12 months
JPY			6 months	7 months

Hedges of net investments in foreign subsidiaries

The table below shows the derivative which the Group has contracted to hedge currency exposure on investments in subsidiaries. Gains or losses on market value adjustments (excluding accrued interest) at year-end are entered directly in Shareholders' equity. Accrued interest (2007: DKK 1 million, 2006: DKK 1 million) is entered in the income statement.

	2007		2006
DKK million	Contract amount based on agreed rates	Market value Dec. 31	Contract amount based on agreed rates	Market value Dec. 31

Currency swap
CHF/DKK - pays fixed rate of 3.62% / earns fixed rate of 5.27%	275	6	275	(2)
	275	6	275	(2)
Currency loan
USD - pays variable rate of 4.94% (compared with 5.59% in 2006)	244	41	244	18
	244	41	244	18

	519	47	519	16

There are no ineffectiveness in hedging of net investment in foreing subsidiaries due to hedge accounting.

The currency swap falls due in September 2008 (September 2008 at the end of 2006), while the loan falls due in June 2009 (June 2009 at the end of 2006).

Fair value hedges

The table below shows the derivatives which the Group has contracted to hedge currency exposure on financial assets and liabilities which give rise to currency adjustments in the income statement, and derivatives which no longer fulfil the criteria for hedging of cash flows. Gains or losses on market value adjustments at year-end are entered in the income statement.

	2007		2006
DKK million	Contract amount based on agreed rates	Market value Dec. 31	Contract amount based on agreed rates	Market value Dec. 31

Forward exchange contracts (sales)
CHF (net purchase)	344	(5)	407	(3)
AUD	155	(1)	307	(5)
GBP	11	(2)	11	-
JPY	40	1	54	2
SEK	185	-	86	-
USD	210	1	482	(4)
	945	(6)	1,347	(10)

The forward exchange contracts fall due in the period January 2007 to June 2008 (January 2007 to October 2007 at the end of 2006).

The gain on forward exchange contracts was DKK 23 million (2006: DKK (4) million) compared with a loss on the hedged items of DKK 26 million (2006: DKK 12 million).

The sensitiveness and the description of the credit risk, liquidity risk and marked risk are described under the part of Risk factors.

The carrying amount for the categories Loans and receivables and Other financial liabilities is at December 31, 2007 respectively DKK 1,928 million and DKK 3,587 million (2006: DKK 1,835 million and DKK 3,283 million). For the categories Hedge accounting (asset), Available-for-sale financial asset and Hedge acocounting (liability) the carrying amount appear from the Balance sheet and the Notes.