AFD // 2021 Universal Registration Document

CONSOLIDATED FINANCIAL STATEMENTS 6 Notes to the consolidated financial statements

❙ Table 1: summary of AFD’s limits and alert indicators for large exposures (sovereign + related) Unless otherwise indicated, the percentages apply to Large Exposure capital (FPGR). Limit system Alert system Regulatory requirements Internal requirements Type of exposure/outstandings considered Authorised exposure Authorised exposure Authorised exposure + ɸ unauthorised exposure + ɸ new provisional approvals “Large exposure*” limit Ceiling: 25% 24% of exposure

24% > an alert is given to the Board of Directors 21% > an alert is given to the Executive Committee

Reporting as “large exposure” when exposure exceeds 10%

* With 1st ࣢ public non-sovereign group attached to the central government. ❙ Table 2: Summary of AFD’s limits and alert indicators for non-sovereign activity Limit system

Regulatory requirements

Internal requirements

Alert system

Authorised exposure Authorised exposure Authorised and

Type of exposure/outstandings considered

unauthorised exposure and new approvals 30% of exposure > an alert is given to the Board of Directors 25% of exposure > an alert is given to the Executive Committee

30% of exposure (unweighted)

Monitoring of non-sovereign activity Regional limits*

Ceiling: 25% Reporting as “large exposure” when exposure exceeds 10%

8% for an individual counterparty (risk weighted exposure) 12% for a counterparty group (risk-weighted exposure)

Limit by counterparty (and counterparty group)

* Without the 1 st ࣢ public NS group attached to the central government.

consolidated equity amounted to €8,810M at 31 ɸ December 2021, the regulatory limit for Large Exposures was €2,203M. The internal limit is set at 24% by default (€2,114M). As regards Large Exposures declared to the regulator, more restrictive regulations came into force on 28 ɸ June 2021. They sets a new threshold for reporting exposures, of €300M for a counterparty or group of related counterparties (compared to 10% of eligible equity previously). 65% of the AFD Group’s exposures were reported after the new reporting methods came into force (51% before). Two preventive alert thresholds also exist to inform the Executive Committee and the Group Risk Committee of a risk of a threshold being exceeded (Large Exposures and non sovereign limits). In 2021, six countries were the subject of an information memorandum from DXR regarding the risk of breach of the preventive alert and/or tolerance threshold for the Large Exposure limit: India, Tunisia, Mexico, Egypt, Colombia, and Morocco.

Within the Executive Risk Department (DXR), the Risk Monitoring (DSR) Division is responsible for monitoring credit risk and limits for the AFD Group. The “Group Risk Monitoring and Reporting (SRG)” unit, attached to DSR, prepares the database that makes it possible to calculate the Large Exposures declared on a quarterly basis and to monitor the limits set by the Board of Directors. The SRG unit prepares the pre-grant document which is inserted for each loan in the notes to AFD’s decision-making bodies (the latter are systematically approved by DSR), thus ensuring continuous monitoring of the level of major risks and credit limits. Every quarter, a review of the operational limits is presented to the “Counterparty Risk Committee (CORIS)”, of which the Executive Management is a permanent member, and to the Group Risk Committee for the monitoring of Large Exposures. Large exposure limit The “Large Exposures” regulatory limit defines the aggregate maximum authorised exposure to third parties or groups of connected third parties as 25% of eligible capital. As

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2021 UNIVERSAL REGISTRATION DOCUMENT