AFD - 2018 Registration document

6 CONSOLIDATED FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH IFRS ACCOUNTING PRINCIPLES ADOPTED BY THE EUROPEAN UNION Statutory auditors’ special report on regulated agreements and commitments

P Co-financing framework agreement between PROPARCO and AFD On 18 May 2017, the AFD Board of Directors approved the signing of an agreement with its subsidiary PROPARCO. This framework agreement, signed on 27 November 2017, aims to clarify and streamline the procedures for processing co-financed projects for the private sector, to help AFD Group meet its objectives. The benefits of this agreement are the streamlining of the procedures and processing costs and monitoring of co-financed projects. Under the financial terms of the agreement, the processing and project monitoring costs will be split equally by sharing the processing and administration fees payable by each counterparty. Thanks to this agreement, which came into effect on the date of its signature, AFD can promote a broader range of financing to private sector counterparties, thereby strengthening the group’s internal synergies. The agreement stipulates the procedures for loan or guarantee transactions co-financed by AFD and PROPARCO S.A. for cases not covered by the sub-participation agreement, namely:

P that AFD’s commitment amount will be higher than that of PROPARCO S.A.; P a tranche of the financing at a concessional rate. In return, PROPARCO S.A. receives remuneration calculated as follows: P processing and admin costs which are invoiced to the borrower and split as follows: P for the first 0.75%: split between AFD and PROPARCO S.A. pro rata to the participations,

P the portion between 0.75% and 1.50%: received in full by PROPARCO S.A.,

P the portion above 1.50%: split between AFD and PROPARCO S.A. pro rata to the participations;

P monitoring and waiver commission: AFD receives the monitoring commission pro rata to its financing amount and PROPARCO S.A. receives the full rider and surrender fee; P Management commission: AFD pays PROPARCO S.A. an annual management fee which is calculated according to the terms of the sub-participation agreement in force and a basis equating to at least i) PROPARCO S.A.’s own outstandings and ii) the total of

AFD’s co-financing outstandings and sub- participation outstandings. In the 2018 financial year, AFD paid PROPARCO 675,000 in commission.

Paris-La Défense, 4 April 2019

The statutory auditors

KPMG S.A. Pascal Brouard

MAZARS Nicolas De Luze

Partner

Partner

176

www.afd.fr

REGISTRATION DOCUMENT 2018