BPCE - 2019 Universal Registration Document

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RISK REPORT

RISK MANAGEMENT SYSTEM

CONSOLIDATED RISK OVERSIGHT ORGANIZATION

forward-looking analyses are presented at meetings of the Group Supervisory Board Risk Committee. Furthermore, it performs specific analyses on counterparties, and portfolio-based risk measurements (statistical collective provisions, etc.) and, when authorized by the supervisory authority, for the calculation of credit risk-weighted assets. It reviews and validates risk models developed internally. Finally, it contributes to efforts to define internal capital requirements as well as internal and external solvency stress tests aimed at measuring the Group’s sensitivity to a series of risk factors and its resilience in the event of a severe shock, by determining impacts in terms of cost of risk. RISK AND COMPLIANCE CULTURE To promote and strengthen the risk and compliance culture at all levels, the Risk and Compliance department of the Risk Governance division is focused on developing risk and compliance training and awareness programs at all Group levels, establishing regular communication on risk and compliance issues throughout the Group, and disseminating and measuring the risk and compliance culture. A banking risk awareness quiz: 200 questions/4 topics (credit risks, financial • risks, non-financial risks and banking environment risks) Targeting the employees of the Banques Populaires, the Caisses d’Epargne and • the subsidiaries Annual training provided for Fédération Nationale des Banques Populaires and • Fédération Nationale des Caisses d’Epargne Targeting the Risk and Compliance departments of the Group institutions and the • employees of BPCE SA (live and replay) Examination of regulatory issues (data protection, non-performing loans, • CRR2/CRD5, etc.) Coordination of the risk and compliance chapters of regulatory reports (universal • registration document, Pillar III, annual report on internal control, ICAAP) Coordination of commitment managers of the BPs, CEs and subsidiaries • Risk assessment of sales functions at Group institutions (New Product • Committee, implementation and updating of sales processes) System 72 training courses, including: • a compliance program (Risk, Compliance and audit functions) • a specific program for the Inspection Générale division •

In addition to the risk supervision conducted both individually and by type of risk, Groupe BPCE’s Risk division also consolidates the Group’s risks. It produces a quarterly risk dashboard, which is used to monitor the risk appetite defined by the Group as well as for comprehensive monitoring of risks based on an analysis of the Group’s risk profile in each area (mapping of risk-weighted assets, credit risks and counterparty risks – by customer segment –, market risks, structural ALM risks, non-financial risks and risks related to insurance businesses). In addition to the dashboard, a monthly flash report provides the Group with a more responsive and updated overview of Group risks. The Risk division also conducts or coordinates cross-business risk analyses and specific stress tests on the Group’s main portfolios or activities and, if needed, for the entities. It has also developed half-year forward-looking risk analyses aimed at identifying economic risk factors (known and emerging; international, national and regional), circumstantial threats (regulations, etc.) and their potential impact on the Group. These

Initiative Training

Risk & Compliance Academy •

Risk Pursuit •

Members of the supervisory bodies and Risk • Committees of the BPs and CEs

Communication

The R&C Hour •

Regulatory workbook •

Regulatory communication •

Sharing of best practices

Sharing of best practices and cross-analyses • between operational entities and control functions

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UNIVERSAL REGISTRATION DOCUMENT 2019 | GROUPE BPCE

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