BPCE - 2020 Universal Registration Document

BPCE MANAGEMENT REPORT FINANCIAL REPORT

BPCE management report 5.5

Significant events of 2020

2020 was marked by the Covid-19 health crisis. Groupe BPCE • entered the crisis with extremely solid fundamentals in terms of its solvency, liquidity and risks, and it took several initiatives to address the consequences of the crisis. It did better than withstand the crisis and its expected prolongation, in particular thanks to the very good level of activity in the two major Banque Populaire and Caisse d’Epargne networks. All its teams mobilized to support customers as closely as possible and work with them to find the best financial solutions to face this crisis. The business continuity plan was implemented to protect employees’ health and safety, facilitate operations for customers (branch opening, ATMs, customer communications, and the application of the new health protection measures), and maintain internal processes (funding, accounting, compliance with regulations, etc. ). Massive use of digital technology became necessary, and the rollout of digital solutions was ramped up. The consequences of the health crisis on BPCE’s financial statements are presented in Note 1.5 of Chapter 5.6.2. To support the economy and its customers, Groupe BPCE • announced an automatic six-month deferral, with effect from March 20, 2020, of investment loans to companies and professionals most affected by the health crisis: more than 425,000 repayment moratoria were signed in 2020. The initial repaymentmoratoria for the tourism, hotel and catering sector have been extended for six months. The retail networks ensured that eligible business and professional customers could benefit from the State-guaranteed loan scheme by undertaking to review all applications rapidly. As a result, 193,000 loans were disbursed in 2020 totaling €30 billion. Groupe BPCE was the first player in France to extensively rollout the Sign’it electronic signature service for State-guaranteed loans issued by the Banques Populaires and the Caisses d’Epargne. To support the recovery of businesses, Banque Populaire and Caisse d’Epargne signed an agreement with the European Investment Fund (EIF) to finance loans amounting to €75 million. This agreement aims to facilitate access to financing for SMEs, mid-cap companies, and start-ups with fewer than 3,000 employees that invest in projects of an innovative, adaptive, or transformational nature in relation to the current health crisis. In terms of organization and in preparation for its future • strategic plan, Groupe BPCE strengthened its digital system, setting a new course for Innovation, Data and Digital combining its digital, data and artificial intelligence activities. On March 31, 2020, BPCE SA finalized the acquisition of • Crédit Foncier’s stake in Crédit Foncier Immobilier (CFI). CFI, which provides real estate services (appraisal/valuation and sales), joined BPCE’s Financial Solutions &Expertise business line, becoming BPCE Solutions Immobilières, to boost its business relations with the Banque Populaire and Caisse d’Epargne networks. In addition, on December 31, 2020, Fidor

Bank AG finalized the sale of its subsidiary Fidor Solutions AG to Sopra Banking Software. Finally, in August 2020, BPCE entered into exclusive negotiations with Ripplewood Advisors LLC for the sale of the entire share capital of Fidor Bank AG. In 2020, BPCE absorbed the Holassure entity through a • simplified merger. BPCE now directly holds the Group’s stake in CNP Assurances. Groupe BPCE continued efforts to firmly embed its • commitment to society and the environment into its business lines and decision-makingprocesses. For example, it launched “Ambition Durable” , a green bond for individual customers of the Banques Populaire and Caisses d’Epargne. The funds raised are used to finance the construction and renovation of buildings with a low environmental footprint. By signing the Responsible Digital Charter, Groupe BPCE has • also affirmed its commitment to an ethical and environmentally friendly digital transition. In particular, it is committed to reducing its digital environmental footprint and developing service offerings that are at once accessible to all, inclusive and sustainable. As a reflection of these advances in CSR, MSCI raised Groupe • BPCE’s rating to AA, in recognition of the Group’s integration of environmental, social and governance (ESG) issues into its policies (development, human resources, risks, business ethics, cyber security, etc. ) and Vigeo Eiris raised the Group’s non-financial rating from “ Robust ” to “ Advanced ” with, in particular, an increase in its environmental strategy rating (+13 points), a reduction in the impact of its businesseson the climate (+9 points) and a reduction in its direct footprint thanks to its mobility policy (+20 points). In 2020, rebilling of the “central institution” activities (listed in • the French Monetary and Financial Code) are now presented in NBI and re-invoicing of group assignments is still presented as a reduction in management fees. In 2020, the amount of contributions in NBI amounted to €356 millionand the amount of contributions less operating expenses amounted to €516 million. In 2020, BPCE SA’s balance sheet base increased by • €39 billion. This increase is in line with the context of the Covid-19 crisis, with the implementation of the funding required for the distribution of State-guaranteed loans by the Group and the significant increase in ordinary accounts in credit. Borrowed securities are now presented on the balance sheet as a deduction from the debt representing the value of securities borrowed pursuant to ANC Regulation 2020-10. The impact is a reduction in the size of the balance sheet of approximately €66 billion for BPCE SA. BPCE issued €4 billion of senior non-preferred debt. These • issues contribute to strengtheningGroupe BPCE’s capital and the TLAC (Total Loss-Absorbing Capacity) and MREL ratios.

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UNIVERSAL REGISTRATION DOCUMENT 2020 | GROUPE BPCE