p 287 MISC BERHAD - Annual Report 2014 35. Financial risk management objectives and policies (cont’d.) (a) Interest rate risk (cont’d.) The Group had in May 2011 entered into an IRS to hedge its interest rate risk of a floating rate borrowing. In conjunction with the early settlement of the floating rate borrowing during the year, the Group also terminated the corresponding IRS attached to this borrowing on the date of the loan repayment. The total notional principal amount of interest rate swaps of the Group at the end of the previous financial year was RM183,431,000 and the fixed interest rates relating to interest rate swaps was 1.85% per annum. As at reporting date, the following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the Group’s and the Corporation’s profit before taxation and equity via floating rate borrowings and interest rate swaps respectively. Effect on Effect on profit other combefore prehensive Increase/ taxation income (Decrease) (Decrease)/ (Decrease)/ in LIBOR Increase Increase basis points RM’000 RM’000 As at 31 December 2014 Group USD - 3 Months LIBOR +10 (7,658) – USD - 3 Months LIBOR –10 7,658 – Corporation USD - 3 Months LIBOR +10 (3,883) – USD - 3 Months LIBOR –10 3,883 – As at 31 December 2013 Group USD - 3 Months LIBOR +10 (5,606) (4,352) USD - 3 Months LIBOR –10 5,606 4,352 Corporation USD - 3 Months LIBOR +10 (3,907) – USD - 3 Months LIBOR –10 3,907 –
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