AFD - 2019 Universal registration document

CONSOLIDATED FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH IFRS 6 Statutory auditors’ special report on regulated agreements

Lastly, AFD provides the SDCs with guarantees of the outstanding capital of the loans taken over, up to their net book value. In 2019, AFD was paid fees and interest for these loans that amounted to €59,000 from SODEMA, €160,000 from SODEGA and €30,000 from SOFIDEG. In 2019, up to €20,111,000 of the credit risk assumed by AFD was covered by a provision for risks for the SODERAG portfolio transferred to the three SDCs, producing a net reversal of €658,000 in 2019. With Fondation pour les Études et Recherches sur le Développement International (FERDI) and Fondation de Recherche pour le Développement Durable et les Relations Internationales (FONDDRI) Lending agreements Under two agreements signed with FERDI and FONDDRI, respectively, AFD undertook in 2000 to grant an interest-free loan of €12,500K to each foundation, repayable in one instalment after 15 years. Loan outstanding amounted to €25,000,000 at 31 December 2019. AFD received no remuneration under these agreements in 2019. With Société de Promotion et Participation pour la Coopération économique (PROPARCO) Co- fi nancing 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. AFD received no remuneration under these agreements in 2019. Management agreement for AFD’s equity stake in the African Agriculture Fund On 18 December 2014, the AFD Board of Directors approved the signing of an agreement with its subsidiary PROPARCO. Under this agreement AFD commissioned PROPARCO to manage its equity stake in the main African Agricultural Fund (AAF) and indirectly in the African Agricultural Fund SME (AAF SME) sub-fund. To pool the management of this investment fund between its various subsidiaries, AFD assigned to PROPARCO S.A. the following key tasks: P managing and monitoring AFD’s equity stake in the AAF (and indirectly in the AAF SME), specifically to represent it on all the governing bodies of the AAF and AAF SME on which AFD was required to sit; P managing and processing, on behalf of AFD, all capital disbursements or distributions requested or carried out by the AAF management fund; P acting as the designated point of contact for the AAF and AAF SME fund managers; P sending AFD each semester the list of documents provided by the AAF and AAF SME fund managers under their reporting obligations to investors;

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UNIVERSAL REGISTRATION DOCUMENT 2019

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