BPCE - 2019 Universal Registration Document

FINANCIAL REPORT

BPCE PARENT COMPANY ANNUAL FINANCIAL STATEMENTS

Information on the income statement

Note 3

3.1

INTEREST AND SIMILAR INCOME AND EXPENSES

Accounting principles Interest and similar commission income is recognized on a pro rata basis. The Group has chosen the following option to account for negative interest: when income from an asset is negative, it is deducted • from interest income in the income statement; when income from a liability is positive, it is deducted from • interest expenses in the income statement.

Commissions and fees related to granting or acquiring a loan are treated as additional interest amortized over the effective life of the loan, on a pro rata basis according to the outstanding amount due. The portion of income received during the year from bonds or negotiable debt securities is also recognized. The same applies to perpetual deeply subordinated notes that meet the definition of a Tier 1 regulatory capital instrument. The Group considers that these revenues are effectively similar in nature to interest.

Fiscal year 2019

Fiscal year 2018

Income

Expense

Net 832

Income

Expense

Net 444

in millions of euros

Transactions with banks Customer transactions

1,140

(308)

795

(351)

12

(1)

11

12

0

12

Bonds and other fixed-income securities

895

(1,828)

(933) (511)

1,916

(3,420)

(1,504)

Subordinated debt

0

(511)

0

509 (22)

509

Macro-hedging transactions

116

(83)

33

80

58

TOTAL

2,163

(2,731)

(568)

2,803

(3,284)

(481)

3.2

INCOME FROM VARIABLE-INCOME SECURITIES

5

Accounting principles Income from variable-income securities includes dividends and other income from equities and other variable-income securities, equity interests, other long-term investments and investments in affiliates. Dividends are recognized when the right to receive payment has been decided by the competent body. They are recognized under “Income from variable-income securities”.

Fiscal year 2019

Fiscal year 2018

in millions of euros

Equities and other variable-income securities Equity interests and other long-term investments

0

0

211 907

200 827

Investments in affiliates

TOTAL

1,118

1,027

509

UNIVERSAL REGISTRATION DOCUMENT 2019 | GROUPE BPCE