AFD - 2019 Universal registration document

RISK MANAGEMENT 4 Basel III Pillar 3

4.2 Basel III Pillar 3

4.2.1 General principles The objective of Pillar 3 of the Basel Ǿ III framework is to improve financial transparency by publishing quantitative and qualitative disclosures of different types of risk, risk evaluation procedures and the capital adequacy of companies. This involves companies: P aligning data with the new international accounting standards (IFRS) on financial communication; P explaining their internal rating methodology and their risk assessment process to the market.

4.2.2.2 Corporate purpose of the Group’s parent company to which this measure applies Agence Française de Développement (AFD) Detailed information about AFD Group’s corporate purpose is Ǿ presented in Paragraph Ǿ 1.1.2 ‘‘General information about AFD’s capital’’. 4.2.2.3 Consolidation scope and methods There is no difference with regard to consolidation principles between accounting data and prudential data. The consolidation scope and methods are defined in Paragraph Ǿ 6 “Consolidated financial statements prepared in accordance with IFRS adopted by the European Union”; Note Ǿ 6.2.3.1 “Consolidation scope and methods”. Moreover, there are no restrictions on transferring funds or regulatory capital within the Group.

4.2.2 Scope of application 4.2.2.1 AFD’s prudential regime

Article Ǿ 7 of the Decree of 23 Ǿ December Ǿ 2013 on the prudential regime for financing companies stipulates that they are required to comply with the provisions applicable to credit institutions pursuant to Regulation (EU) no. Ǿ 575/2013 of the European Parliament unless otherwise exempted by this decree. These exemptions relate to: P the leverage ratio; P the liquidity management ratios (LCR and NSFR); P the BRRD directive and its resulting MREL on the resolution of banking institutions in the EU.

4.2.3 Risk Capital 4.2.3.1 Capital structure

The AFD Group’s capital at 31 Ǿ December Ǿ 2019 was €7,466M, up €287M from €7,179M at the end of 2018. CET1 capital stood at €6,177M, compared with €6,131M at the end of 2018. Total Tier Ǿ 1 increased from €6,971M to €7,018M.

❙ Capital structure of the AFD Group at 31 December 2019

In millions of euros CET1 capital before deductions

6,177

CET1 deductions

0

CET1 capital after deductions T1 capital before deductions

6,177 7,018

T1 deductions

0

T1 capital after deductions T2 capital before deductions

7,018

448

T2 deductions

0

T2 capital after deductions

448

TOTAL CAPITAL

7,466

84

UNIVERSAL REGISTRATION DOCUMENT 2019

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