NOTES TO THE FINANCIAL STATEMENTS Year ended 31 December 2025 10 FINANCIAL ASSETS (CONT’D) The movement in the allowance for impairment for debt investments at amortised cost during the year was as follows: Lifetime ECL credit -impaired 2025 2024 $’000 $’000 Balance as at 1 January 312,501 304,405 Translation differences on consolidation (17,043) 8,096 Balance as at 31 December 295,458 312,501 The Group undertook an impairment assessment of the investment in the bond. As at 31 December 2024, Sincere Property Group remained under bankruptcy reorganisation, and no reorganisation plan had been finalised. In 2025, the reorganisation plan received approval from the Chongqing No. 5 Intermediate People’s Court following requisite votes secured in a creditors’ meeting and is in the process of being implemented. As at 31 December 2025 and 31 December 2024, the Group assessed that the investment in the bond remained to be credit-impaired. The Group assessed lifetime ECL to be recognised, taking into consideration the latest developments at Sincere Property Group based on available information at the reporting dates, prevailing market conditions and price trends of corporate bonds issued by other China real estate developers facing similar debt and liquidity challenges. Based on the assessment undertaken, the investment in the bond remained fully impaired. The key parameter applied in estimating the ECL to be recognised include assuming a loss given default (“LGD”) of 100% having considered the uncertainty surrounding the complex bankruptcy reorganisation with the passage of time, which posed challenges to the recovery of the investment in the bond. As the implementation of the reorganisation plan is ongoing, the recovery remains uncertain and subject to change as the process progresses. Changes to circumstances and estimates may impact the ECL recognised on the investment in the bond. The ECL on the investment in the bond is sensitive to the assumptions used. As the investment in the bond has been fully impaired, any decrease in LGD in isolation would result in a lower ECL. 160 | CITY DEVELOPMENTS LIMITED
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