GROUPAMA / 2020 UNIVERSAL REGISTRATION DOCUMENT

7 FINANCIAL STATEMENTS Annual financial statements and notes

Significant events of the year 1

Covid 1.1 The Covid pandemicbegan to wreak havoc on 2020 in March with major impacts on the economy, individuals and entities, and markets. For the insurance sector, the consequencesof this crisis were also significant, increasing the level of judgement required to assess certain balance sheet items. The impact of Covid on Groupama Assurances Mutuelles, the Group’s main reinsurer, has not been exactly the same in France (where the portfolio is highly diversified) as internationally, where business (mainly non-life) in most countries is relatively focused on motor insurance. In addition, the international situation is not comparable between certain heavily affected countries, such as Italy, or other less-affected countries, such as (Eastern European countries, Turkey, and China). In reaction to the economic effects of this pandemic, Groupama Assurances Mutuelles played its role as reinsurer through several actions: premium-reductionmeasuresGroup, amountsto, in particularfor ❯ agricultural professions (two-month premium reduction on tractors), craftsmen, retailers, and service professionals (ACPS), and health professionals for an overall amount for the Group of €109 million, including €29 million borne by Groupama Assurances Mutuelles, the Group’s reinsurer; contribution to government expenditure relating to the ❯ management of the Covid pandemic for €91 million for the Group, including€6 million for GroupamaAssurancesMutuelles. This contributioncorrespondingto 2.6% of the health premiums for 2020 and 1.3% of the estimatedhealth premiumsfor 2021 is requested from supplemental health organisations in return for the lower expenditure on the health segment that these organisations observed during the health crisis. It is booked in the outstanding claims reserve in accordance with the AMF accounting standards regulation of 22 December 2020; €4.9 million contribution to the solidarity fund set up by the ❯ central government to support VSE/SMEs (booked in extraordinary result in accordance with the ANC recommendation); civic measures for €0.2 million (grants to associations, medical ❯ institutions, etc.). The particular context also led the entity to strengthen the judgement elements for the assessment of a number of commitments: regarding the valuation of technical reserves, the Covid health ❯ crisis and the lockdownperiod changed the occurrenceand the usual development rate of claims, making the estimation of technical reserves more difficult this year. In addition to the effects on the current claim ratio (reduced frequency in some segmentssuch as motor or health during the lockdownperiodor cumulative loss experience on others), there are operational effects related to the lockdowns that disrupted the day-to-day managementof claims. Methods based on the analysis of past

rates may lead to an underestimation or overestimation of technical reserves. The parameters of the models were thus adapted, and alternative methods that are less sensitive to the paces of occurrence or settlement of claims were used in addition in order to value the claims reserves; on certain risks highly exposed to Covid (insurance for operating ❯ losses, event cancellation), the impact at the level of Groupama Assurances Mutuelles amounts to €33 million (net of reinsurance). In general, and more specificallyon these risks, the Group also conducted a very careful review of its contractual clausesand implementeda policy of scrupulouscompliancewith its commitments. It should also be noted that financial investments were not significantly affected by the crisis and that the methods for establishing reserves for these assets remained unchanged. In summary, it is worth pointing out that the entity’s fundamentals are very resilient under these adverse health circumstances.This is reflected in particular in the Group’ssolvency level, which continues to be good. The going-concern assumption underlying the preparation of its financial statements therefore remains perfectly relevant.

1.2 Financial rating (a)

Financial strength

On 19 March 2020, Fitch Ratings revised Groupama’s rating outlook to “Stable” and maintained its “A” rating, to take into account both the significant uncertainty created by the global coronavirus pandemic, which led to high levels of volatility in financial markets, and “Negative” on the French life insurance sector. On 19 May 2020, then on 29 September 2020, the agency confirmed Groupama’s “A” rating and “Stable” outlook. The Fitch rating reflects Groupama’s ability to maintain strong capitalisation and leverage as well as its highly robust business profile in the French insurance sector.

1.3 Partnerships (a)

Business Activities

On 19 December 2019, La Banque Postale and the Groupama group announced the signing of a memorandumof understanding for La Banque Postale to acquire Groupama’s 35%stake in La Banque Postale IARD. On 7 April 2020, the sale was finalised for €211 million, and Groupama Assurances Mutuelles received non-recurring one-off compensation of €44.7 million for the conclusion of its reinsurance partnership, with the balance of the sale borne by its subsidiary Groupama Holding Subsidiaries et Participations.

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Universal Registration Document 2020 - GROUPAMA ASSURANCES MUTUELLES