BPCE - 2020 Universal Registration Document

REPORT ON CORPORATE GOVERNANCE

RULES AND PRINCIPLES GOVERNING THE DETERMINATION OF PAY AND BENEFITS

Pay component

Principles and criteria adopted

Amount of the retirement bonus • The monthly benchmark pay used in the calculation is equal to one-twelfth of the sum of the fixed pay (excluding benefits and the special supplement) granted for the last calendar year of work preceding the termination of the corporate office or employment contract and the average of the top three variable pay amounts (whether paid immediately or deferred) for the last five calendar years of work preceding the termination of the corporate office or employment contract. Amounts in respect of the relevant corporate office and employment contract are taken into account. The amount of involuntary-termination severance pay is equal to: Monthly benchmark pay x (6 +0.6 A) where A is the number, which may be a fraction, of years served in a corporate office within the relevant scope (i.e. terms of the offices served as Chief Executive Officer of Banque Populaire, Chairman of the Management Board of Caisse d’Epargne, Chief Executive Officer of CFF until November 6, 2019, Chief Executive Officer of BPCE I until December 31, 2018, Chairman of the Management Board of Banque Palatine, and members of the Management Board of BPCE SA group). For an executive benefiting from this scheme who is then appointed to the Executive Management Committee of Natixis or who, following a transfer to BPCE SA, holds the position of CEO or Deputy CEO at BPCE SA, the terms during which these offices are held will be taken into account when determining A. Conversely, the terms during which these offices are held before the executive becomes a beneficiary of this scheme will not be taken into account. Should the offices included in the calculation of A be held simultaneously, these terms will be counted only once (no double-counting). The amount is capped at 12 times the monthly benchmark pay corresponding to a total term of office of 10 years. Regardless, any compensation paid for termination of an employment contract is deducted from the retirement bonus. The contribution rate is 6% from Bracket A and 4% from the pensionable portion of pay in excess of Bracket A and capped at eight times the annual ceiling for social security annuities; 70% of this contribution is paid by the company and 30% by the employee; the mandatory R2E collective supplementary defined-contribution pension plan for all BPCE senior executives (AFB agreement) and • by extension applicable to BPCE company directors. The contribution rate is 3.5% of pay capped at eight times the annual ceiling for social security annuities. This contribution is funded entirely by the company. Management Board Members were also able to vest entitlements under this plan during their previous careers as Group employees or company directors. Furthermore, there are other supplementary pension plans offered to members of the Management Board, based on their professional career spent with the Group, namely: Pension plan for company directors of Groupe BPCE: pension plan governed by Article L. 137-11 of the French Social Security Code: until June 30, 2014, Chairmen of Caisse d’Epargne Management Boards, Members of the Management Board of the former CNCE • and Chief Executive Officers of Crédit Foncier, Banque Palatine and BPCE International could benefit from a supplementary defined-benefit pension plan entitling them to additional retirement income based on their salary; until June 30, 2014, Banque Populaire Chief Executive Officers could benefit from a differential defined-benefit pension plan. • Effective July 1, 2014, these two pension plans were harmonized under a single supplementary pension plan, now closed to new members and subject to conditions: they must end their career with Groupe BPCE. This condition is met when beneficiaries are Group employees on the day before their • social security pension is drawn following voluntary retirement; they must have served in an executive management position for at least the required minimum period (seven years) at the date on • which their social security pension is drawn. Beneficiaries who meet the above conditions are entitled to an annuity set at 15% of benchmark pay, i.e. their average annual pay earned in the three highest-paid years during the five calendar years before the date on which their social security pension is drawn and capped at four times the annual ceiling for social security annuities. Annual pay refers to the sum of the following types of pay received for the year in question: fixed pay, excluding benefits in kind or duty-related bonuses; • variable pay – not exceeding 100% of fixed pay – and defined as the total variable amount paid, including the portion that may have • been deferred over several years and subject to attendance and performance requirements, in accordance with regulations on variable pay granted by credit institutions. Once drawn, this supplementary pension may be paid to a spouse or former non-remarried spouse, at a rate of 60%. This plan, which is funded entirely by the Group, is covered by two Insurance policies taken out with the Quatrem and Allianz Insurance companies, with a target obligation coverage rate of 80% of assets and 100% of pension recipients. Expenses paid by the company consist of the 32% contribution on annuities paid by the insurer to the beneficiaries. The pension plan for company directors of Groupe BPCE, which is a supplementary pension plan subject to Article L. 137-11 of the French Social Security Code, is governed by the provisions of section 25.6.2 of the AFEP-MEDEF Code. It complies with the principles governing the capacity of beneficiaries, overall establishment of base pay, seniority conditions, the progressive increase in potential entitlements depending on seniority, the reference period used to calculate benefits and the prevention of artificially inflated pay. For the members of the Management Board who benefit from this plan, the annual vesting of conditional entitlements is contingent on Groupe BPCE generating a net profit for the period considered. Members of the Management Board who are not on the Group’s supplemental executive pension plan are entitled to participate in the pension plan through a group insurance policy under Article 82 of the French General Tax Code, in which company directors of Groupe BPCE who do not benefit from the “Pension plan for company directors of Groupe BPCE” may participate, as this policy is the mandatory CGP collective supplementary defined-contribution pension plan for all BPCE employees and by extension applicable • to BPCE company directors.

Involuntary-termination severance pay and retirement bonus ( continued)

3

Supplementary pension plan Members of the Management Board receive:

funded solely through voluntary payments by the company directors who have decided to participate therein. As such, the fixed pay of the Management Board Members on that plan includes a 20% special supplement.

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UNIVERSAL REGISTRATION DOCUMENT 2020 | GROUPE BPCE