BPCE - 2019 Universal Registration Document

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FINANCIAL REPORT

IFRS CONSOLIDATED FINANCIAL STATEMENTS OF BPCE SA GROUP AS AT DECEMBER 31, 2019

SIGNIFICANT EVENTS 1.3 CONSOLIDATION OF CRÉDIT FONCIER’S OPERATIONS AND EXPERTISE IN GROUPE BPCE The business components of the plan to consolidate Crédit Foncier’s operations in Groupe BPCE, initiated in June 2018, was implemented in 2019. Subsidiary Socfim was sold to BPCE in December 2019, becoming a global Corporate refinancing player, now comprising long and short-term financing for real estate professionals. Furthermore, after filing a public delisting offer for the shares of its subsidiary Locindus, Crédit Foncier bought back all non-controlling interests in Q1 2019. Locindus was then merged with its parent company, Crédit Foncier de France. This merger had no material impact on the Group’s consolidated financial statements at December 31, 2019. As planned in February 2019, Crédit Foncier ceased its loan origination activity at December 31, 2019, which was then redeployed across the Group networks in April after a transition phase. A new real estate partnership management organization at the Group level was set up. Crédit Foncier has refocused on managing its outstanding loans and on the funding of public sector assets originated by the Group, through Compagnie de Financement Foncier. The labor components, including the GPEC (strategic workforce planning) and PSE (employment protection plan) agreements, were implemented. Employees whose jobs were slated to be cut were offered jobs at other Group companies in January 2019. These employees, who also had the option of transferring outside the Group under a voluntary resignation plan, joined their new companies in early April 2019. As a result of the labor components of the plan, the Group recognized an additional net expense of €27 million before tax in 2019 in respect of 1) a higher percentage of employees opting for the voluntary resignation plan than initially estimated at December 31, 2018 and 2) the reversal of provisions for employee benefits subsequent to the permanent departure of said employees. SALE BY NATIXIS AND ACQUISITION BY BPCE SA OF THE FACTORING, SURETIES & FINANCIAL GUARANTEES, LEASING, CONSUMER FINANCE AND SECURITIES SERVICES BUSINESS LINES On September 12, 2018, Natixis and BPCE announced Natixis’ plan to sell its Factoring, Sureties & Financial Guarantees, Leasing, Consumer Finance and Securities Services business lines to BPCE SA for €2.7 billion. The deal was signed on March 29, 2019, with a legal effective date of March 31, 2019. In line with the established timetable, the shares of the subsidiaries, and the assets and liabilities of the EuroTitres business line, were transferred on March 31, 2019 after the conditions precedent were met. Control of the subsidiaries sold by Natixis was gradually transferred to BPCE over the period. This, combined with the other characteristics of the deal, led Natixis to recognize the loss of control at January 1, 2019. As a result, BPCE SA group consolidated all of the income reported by the transferred subsidiaries since January 1, 2019 into its consolidated income statements for fiscal year 2019. Given that the disposal was an internal BPCE SA group transaction, it had no material impact on consolidated income for fiscal year 2019. The impact on shareholders’ equity was -€6 million; this corresponds to the costs of the transaction plus

the transfer of reserves attributable to equity holders of the parent (-€241 million) to reserves attributable to non-controlling interests (+€241 million). ACQUISITION OF A 50.1% STAKE IN ONEY BANK BY BPCE Following exclusive talks entered into on February 12, 2019, Auchan Holding and BPCE signed a long-term partnership agreement on April 4, 2019, which resulted in BPCE acquiring a 50.1% stake in Oney Bank. Present in 10 countries, with 2,600 employees, 7.7 million customers and 400 brick-and-mortar and online retail partners, Oney Bank will benefit from the joint expertise of BPCE and Auchan Holding with a view to accelerating its growth and expanding its presence in Europe in payment, financing and digital identification solutions. Local digital banking will also enhance the customer offering. The deal was finalized on October 22, 2019 and generated goodwill of €138 million, which was temporary given the completion date of the transaction. The Group has a period of twelve months from the acquisition date to finalize the allocation of goodwill from first consolidation. GROUPE BPCE AND LA BANQUE POSTALE BROADENED AND EXPANDED THEIR BUSINESS PARTNERSHIP On December 19, 2019, Groupe BPCE, Natixis and La Banque Postale announced the principles of an extended business partnership with the creation of a major Retail Banking and Insurance division. There are several parts to the project, including the integration of certain asset management activities in France. Under the project, Ostrum Asset Management will develop euro fixed income and credit strategies and insurance for Ostrum Asset Management and LBP Asset Management, with the goal of establishing an asset manager fully in line with the principles of socially responsible investment. The future entity will be 55% owned by Natixis (through its subsidiary Natixis Investment Managers) and 45% by LBP (through its subsidiary LBP Asset Management), with a balanced governance structure. In addition, in a bid to bolster the multi-partnership model in force at CNP, to which BPCE and LBP are deeply committed, from January 1, 2020 Groupe BPCE and CNP Assurances extended the term of the agreements signed between BPCE/Natixis and CNP Assurances in 2015 (covering payment protection insurance, provident insurance and collective health insurance in particular) from December 31, 2022 to December 31, 2030. These agreements also provide for the transition to a 50-50 coinsurance split between Natixis Assurances (BPCE Vie and BPCE Prévoyance) and CNP Assurances for collective payment protection insurance and for CNP Assurances to underwrite 34% of individual PPI subscribed for by BPCE Vie. Alongside the CNP Assurances/La Banque Postale merger scheduled for early January 2020, and following the termination at the end of June 2018 by La Banque Postale of the current CNP Assurances shareholders’ agreement set to expire on December 31, 2019, BPCE and La Banque Postale entered into a new agreement in their capacity as shareholders of CNP Assurances (holding respective stakes of 16.11% and 62.13%) effective until the end of 2030. Groupe BPCE will still be represented on the CNP Assurances Board of Directors, with two members, and on its specialized committees.

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UNIVERSAL REGISTRATION DOCUMENT 2019 | GROUPE BPCE

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