NOTES TO THE FINANCIAL STATEMENTS Year ended 31 December 2025 7 INVESTMENTS IN AND BALANCES WITH SUBSIDIARIES (CONT’D) The Company assessed the carrying amount of its investments in subsidiaries for indicators of impairment. Based on the assessment in 2025, the Company recognised an impairment loss of $63,000 on its investment in a wholly-owned subsidiary, which is in process of liquidation after taking into consideration of its financial position. Based on the assessment in 2024, the Company recognised an impairment loss of $10,117,000 on its investments in two wholly-owned subsidiaries, with one subsidiary in liquidation while the other subsidiary in process of liquidation after taking into consideration of their financial position. The recoverable amounts of subsidiaries were estimated taking into consideration fair values of underlying assets and the liabilities of the subsidiaries. The fair value measurement was categorised as a Level 3 in the fair value hierarchy based on the inputs to the valuation techniques used. The non-trade amounts owing by and to subsidiaries are unsecured. In respect of interest-bearing amounts owing by and to subsidiaries, interest was charged at 1.00% to 5.37% (2024: 1.00% to 6.37%) per annum and at 3.33% to 4.60% (2024: 3.33% to 4.60%) per annum respectively, as at 31 December 2025. The non-trade balances with subsidiaries that are presented as receivable or repayable within one year are receivable or repayable on demand. The non-trade amounts owing by subsidiaries receivable after one year are loans to subsidiaries for which settlement is neither planned nor likely to occur in the foreseeable future. These amounts are, in substance, a part of the Company’s net investments in subsidiaries. Information about the Company’s exposure to credit risk on the amounts owing by subsidiaries is included in note 41. Impairment losses The movements in impairment losses in respect of investments in subsidiaries and amounts owing by subsidiaries during the year are as follows: Investments in subsidiaries Amounts owing by subsidiaries Lifetime ECL – not credit impaired 2025 2024 2025 2024 $’000 $’000 $’000 $’000 At 1 January 21,735 11,618 322,927 313,928 Impairment loss recognised/(written back) 63 10,117 (2,577) 8,999 At 31 December 21,798 21,735 320,350 322,927 During 2025, the write back in loss allowance on amounts owing by subsidiaries was due to improved financial positions of the subsidiaries. During 2024, the increase in loss allowance on amounts owing by subsidiaries was due to a decline in the financial positions of the subsidiaries. Further details regarding the Group’s subsidiaries are set out in note 43. ANNUAL REPORT 2025 | 155
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