BPCE - 2020 Universal Registration Document

6

RISK FACTORS & RISK MANAGEMENT

RISK MANAGEMENT SYSTEM

ROBUST FINANCIAL STRENGTH Groupe BPCE enjoys high liquidity and solvency levels: in terms of solvency, the Group is able to absorb, if need be, • the occurrence of a risk at entity or Group level; in terms of liquidity, the Group has a significant reserve • consisting of cash and securities enabling it meet regulatory requirements, pass stress tests and access central bank unconventional financing mechanisms. It also has a sufficient amount of high-quality liquid assets eligible for market funding mechanisms and those offered by the European Central Bank. The Group ensures the robustness of this system by implementing global stress tests carried out regularly. They are intended to verify the Group’s resilience, particularly in the event of a serious crisis.

a resilience limit which, if breached, exposes the Group to a • potential business continuity and/or stability risk. Any such breach must be reported to the BPCE Supervisory Board and addressed by a specific action plan validated by the Board; an extreme limit in conjunction with the Group’s resolution • and recovery plan which, if breached, could jeopardize the Group’s very survival. This extreme limit concerns certain indicators adopted in respect of the Group’s risk appetite. A quarterly dashboard is prepared by the Group’s Risk division, for the purpose of regularly and extensively monitoring all risk indicators and reporting to the supervisory body or/and any committee thereof. The risk appetite framework is adapted by the entities for consistent group-wide implementation.

606

UNIVERSAL REGISTRATION DOCUMENT 2020 | GROUPE BPCE

www.groupebpce.com