BIC - 2018 Registration document

FINANCIAL STATEMENTS

Parent company financial statements of Société Bic (French GAAP)

NOTE TO THE OFF-BALANCE SHEET COMMITMENTS

OFF-BALANCE SHEET FINANCIAL INSTRUMENTS NOTE 19

The following are SOCIÉTÉ BIC’s main off-balance sheet financial instruments:

19.1

Currency derivatives

Hedge nominals denominated in currencies other than the euro are converted to euros at December 31, 2018 closing rates. The valuation of the hedges computed in accordance with market practices in terms of inputs (spot, yield curves, volatility curves) and calculation models.

Forward portfolio detail

Nominal (euros)

Market value (euros)

Hedging support

Instrument

Commercial Flows 2019 Commercial Flows 2020

333,378,505

(3,309,122)

Forward Forward Forward

5,195,692

14,384

Intra-Group Dividends

74,235,808

(3,930,460)

Loans/Borrowings

128,734,327 541,544,332

74,411

Currency Swap

TOTAL

(7,150,787)

Options portfolio detail

Options purchased Nominal (euros)

Options sold Nominal (euros)

Market value (euros)

Hedging support

Instrument

Commercial Flows 2019 Commercial Flows 2020

90,563,688

147,151,620

996,624

Option Option

887,390

1,331,085

8,098

TOTAL

91,451,078

148,482,705

1,004,722

As of December 31, 2018, SOCIÉTÉ BIC had contracted: derivatives contracts (foreign currency forwards and options) ● maturing in 2019 and 2020 for an equivalent of 578.5 million euros in gross nominal value. These contracts hedge, on the basis of forecast cash flow, a significant part of the Group’s foreign currency transaction risks. The foreign currency transactions are denominated in U.S. dollars, Pounds sterling, Canadian dollars, Australian dollars, New Zealand dollars, Japanese yens, Swiss francs, Polish zlotys, Romania lei and Mexican pesos. The market value of these contracts is negative for 2.3 million euros; derivatives contracts (foreign currency forwards and options) ● maturing in 2019 for an equivalent of 74.2 million euros in gross nominal value, dedicated to the hedge of the intra-Group dividends received in foreign currencies. The market value of these contracts is negative for 3.9 million euros;

foreign currency swaps for an equivalent of 128.7 million ● euros, in connection with the Group’s foreign currency liquidity and intra-Group foreign currency loans and borrowings. The market value of these contracts is positive for 74,411 euros. In 2019, more than 90% of the Group’s foreign currency transaction exposure is hedged.

19.2

Interest rate derivatives

As of December 31, 2018, SOCIÉTÉ BIC does not have any interest rate derivatives. All local funding needs are directly indexed on a variable rate. Borrowers’ positions are insignificant and are of a too limited timescale to require any hedging.

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• BIC GROUP - 2018 REGISTRATION DOCUMENT •