BPCE - 2018 Registration document

3 REPORT ON CORPORATE GOVERNANCE Role and operating rules of governing bodies

any material acquisitions or disposals, including acquisitions or disposals of equity interests, carried out by the Banque Populaire banks and the Caisses d'Epargne, specifically reviewing the associated terms and conditions as well as the prudential and accounting impacts. Activity The Audit Committee met six times between January 1 and December 31, 2018. The average attendance rate at these meetings was 97.62%. The main issues that it addressed were as follows: presentation of BPCE’s annual financial statements for the year ● ended December 31, 2017 and review of the 2019 Budget; presentation of BPCE’s 2018 quarterly and half-year financial ● statements; monitoring of the impact of adopting IFRS 9 and the Impairment ● for credit risk under IFRS 9; review and examination of Groupe BPCE’s solvency and liquidity ● ratios; oversight of the management of intra-group capital adequacy ratio ● requirements; regular reporting about Crédit Foncier’s earnings and monitoring of ● the project to integrate Crédit Foncier’s business into Groupe BPCE; regular reporting about the earnings of BPCE International and its ● subsidiaries and monitoring the project to devolve BPCE International’s assets; monitoring of the work performed by the Statutory Auditors, ● reviewing their independence, follow-up on their fees, approving the services carried out by the Statutory Auditors other than certifying financial statements; reviewing the strategic operations undertaken by the Group. ● The Risk Committee assists the Supervisory Board with respect to BPCE’s overall strategy and risk appetite, both current, future and when the Supervisory Board reviews the strategy’s implementation. Accordingly, it is tasked with assessing the effectiveness of the internal control and risk management systems and, more generally, fulfills the duties set out in Articles L. 511-92 et seq . of the French Monetary and Financial Code and by the Ministerial Order of November 3, 2014 on internal control of banking sector companies. In this respect, its duties include: conducting a regular review of the strategies, policies, procedures, ● systems, tools and limits referred to in Article 148 of the Ministerial Order of November 3, 2014 on internal control of banking sector companies and the underlying assumptions, and sharing its findings with the Supervisory Board; reviewing the total risk exposure of company and Groupe BPCE ● activities, based on the associated reports; advising the Supervisory Board on the company’s overall strategy ● and risk appetite, both current and future; assisting the Supervisory Board when it reviews the implementation ● of this strategy by the members of the Management Board and the Head of Risk Management; RISK COMMITTEE Duties

assisting the Supervisory Board in regularly reviewing the policies ● established to comply with the provisions of the Ministerial Order of November 3, 2014 on internal control of banking sector companies, assessing the effectiveness of these policies and that of the provisions and procedures implemented for the same purposes as well as any corrective measures undertaken in the event of failures; reviewing the annual report(s) on risk measurement and supervision ● and on the conditions under which internal control is conducted throughout the Group; proposing to the board the materiality criteria and thresholds ● referred to in Article 98 of the Ministerial Order of November 3, 2014 on internal control of banking sector companies, i.e. the criteria and thresholds used to identify incidents that must be brought to the board’s attention; ensuring the independence of Groupe BPCE’s Inspection Générale ● division, which is authorized to request or access all items, systems, or information required for the successful completion of its duties; reviewing the annual schedule of the Group’s Inspection Générale ● division; ensuring that the findings of audits performed by the ACPR and/or ● the ECB and the Group’s Inspection Générale division, whose summaries regarding the company and Groupe BPCE entities are disclosed to it, are addressed; reviewing the follow-up letters sent by the ACPR and/or by the ECB ● and issuing an opinion on the draft replies to these letters; determining, in accordance with its purview, if the prices of ● products and services (referred to in Books II and III of the French Monetary and Financial Code: financial instruments, savings products, bank transactions, investment services, etc.) offered to customers are compatible with the company’s risk strategy and, if not, presenting a corrective action plan to the Supervisory Board; determining if incentives provided by the company’s pay practices ● and policy are compatible with the risks incurred by the company, its capital and liquidity and the likelihood that the expected benefits will vest, as well as their staggered vesting over time. Activity The Risk Committee met nine times between January 1 and December 31, 2018. The average attendance rate at these meetings was 87.70%. The main issues that it addressed were as follows: follow-up on the reports and investigations of the Autorité de ● contrôle prudentiel et de résolution (ACPR – French Prudential Supervisory and Resolution Authority) and the European Central Bank (ECB), and on the recommendations made by the Group’s Inspection Générale division; analysis and follow-up of the Supervisory Board Chairman’s report ● on internal control and risk management; review of reports on internal control prepared in accordance with ● Article 258 of the Ministerial Order of November 3, 2014 on internal control of banking sector companies and on risk measurement and supervision, prepared in accordance with Article 262 of the Ministerial Order of November 3, 2014 on internal control of banking sector companies: work carried out by the Inspection Générale division, annual compliance report (annual report of the Investment Services Compliance Officer [RCSI], report on the annual check control program, report on credit risks), update on accounting risks;

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Registration document 2018