BPCE - 2019 Universal Registration Document

FINANCIAL REPORT

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

These agreements had no material impact on the BPCE SA group’s consolidated financial statements at December 31, 2019. SALE OF BPCE INTERNATIONAL’S AFRICAN SUBSIDIARIES Pursuant to the agreement entered into in September 2018 with BCP Maroc, the African subsidiaries of BPCE International (Banque International du Cameroun pour l’Epargne et le Crédit (BICEC), Banque Commerciale Internationale (BCI) and Banque Malgache de l’Océan Indien (BMOI)), were sold in Q3 2019. These disposals had no material impact on the BPCE SA group’s consolidated financial statements at December 31, 2019. In December 2019, an agreement for the sale of Banque Tuniso-Kowetienne (BTK) and its subsidiaries was entered into with the Tunisian government. The deal, subject to the approval of the supervisory authorities, should be finalized in the first half of 2020. Consequently, their assets and liabilities are presented in accordance with IFRS 5 “Non-Current Assets Held for sale and Discontinued Operations”. SALE OF BPCE INTERNATIONAL’S OVERSEAS BANKS On June 11, 2019, subsidiaries Banque de Tahiti and Banque de Nouvelle Calédonie were sold to Caisse d’Epargne Ile-de-France. These disposals had no material impact on the BPCE SA group’s consolidated financial statements. REGULATORY FRAMEWORK 2.1 The consolidated financial statements of Groupe BPCE were prepared under International Financial Reporting Standards (IFRS) as adopted by the European Union and applicable at the reporting date, excluding certain provisions of lAS 39 relating to hedge accounting. 2.2 The standards and interpretations used and detailed in the annual financial statements as at December 31, 2018 were complemented by standards, amendments and interpretations whose application is mandatory for reporting periods starting from January 1, 2019. Note: the new IFRS 9 “Financial Instruments” was adopted by the European Commission on November 22, 2016 and applies retrospectively from January 1, 2018. IFRS 9 replaces IAS 39 and defines the new rules for classifying and measuring financial assets and liabilities, the new impairment methodology for the credit risk of financial assets, and hedge accounting, except for macro-hedging, which the International Accounting Standards Board (IASB) is currently studying in a separate draft standard. ACCOUNTING STANDARDS NATIXIS INTERTITRES AND NATIXIS DISPUTE On December 18, 2019, the competition authority published a press release on its website in which it announced it was

imposing penalties totaling nearly €415 million on four historic meal voucher issuers for collusion. Natixis Intertitres alone was fined €4.4 million and was subject to two other fines totaling €79 million jointly and severally with Natixis. As soon as the penalty was announced, Natixis acknowledged the Authority’s ruling while refuting any accusation of collusion with its competitors. It stated that it was extremely surprised by this ruling, which it found both groundless and completely out of proportion. It plans to appeal the ruling and believes it holds multiple arguments to dispute it. In these conditions, no provision was recorded in the financial statements at December 31, 2019, as BPCE SA group does not consider that it has caused damages of any kind or breached any regulations, and considers that it has valid arguments to that effect. 1.4 The financial statements for fiscal year 2019 were approved by the Management Board on February 4, 2020. Since then, Natixis announced on February 25, 2020 that it had concluded a Memorandum of Understanding for the sale of 29.5% of its stake in Coface for a price per share of €10.70. As of the date of signing of the MoU, goodwill impairment will be recognized on this Coface equity interest, estimated at around €100 million based on data taken at December 31, 2019. After the disposal, which may take place several months after the announcement as the necessary regulatory authorizations are obtained, Natixis will no longer be represented on the Board of Directors of Coface. POST-BALANCE SHEET EVENTS BPCE SA group used the option available in IFRS 9 not to apply the provisions of the standard relative to hedge accounting, and to continue to apply IAS 39 as adopted by the European Union for the recognition of these transactions, i.e. excluding certain provisions relating to macro-hedging. In view of the limited volume of asset reclassifications, most transactions recognized using hedge accounting under IAS 39 continue to be disclosed in the same way from January 1, 2018. However, IFRS 7 amended by IFRS 9 requires additional information on hedge accounting to be provided in the Notes. On November 3, 2017, the European Commission adopted the amendment to IFRS 4 applying IFRS 9 “Financial Instruments” with IFRS 4 “Insurance Contracts” with specific provisions for financial conglomerates, applicable from January 1, 2018. European regulations therefore allow European financial conglomerates to opt to defer application of IFRS 9 for their insurance activities until January 1, 2021 (effective date of new IFRS 17, Insurance Contracts), provided they: do not transfer financial instruments between the insurance • sector and other sectors of the conglomerate (with the exception of financial instruments designated at fair value through profit or loss for the two sectors affected by the transfer);

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Applicable accounting standards and comparability Note 2

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UNIVERSAL REGISTRATION DOCUMENT 2019 | GROUPE BPCE