NATIXIS - 2018 Registration document and annual financial report

FINANCIAL DATA Consolidated financial statements and notes

these loss events had an impact on the estimated cash flows a of the financial asset. IFRS 9 now requires that entities recognize impairments at an earlier stage than under IAS 39, i.e. from the date of initial recognition of the financial instrument. Accordingly, the application of the new IFRS 9 provisioning model leads to an increase in the amount of the impairments recorded for loans and securities carried at amortized cost in the balance sheet or recorded at fair value through recyclable other comprehensive income, and for loan and guarantee commitments given (excluding those recognized at fair value through profit or loss) and lease receivables. The impact of the first-time application of IFRS 9 on opening equity related to the implementation of the new impairment model is €166.8 million before tax and €124.7 million after the impact of deferred taxes (negative impacts). The principles of the new impairment model applied pursuant to IFRS 9 are described in Note 6.3.

Impairment Under IAS 39, there was a separate provisioning model for: (i) instruments measured at amortized cost, (ii) debt instruments recognized in “Available-for-sale assets”, (iii) equity instruments recognized in “Available-for-sale assets”, and (iv) instruments recognized at cost. In contrast, under IFRS 9, there is just one provisioning model. This model applies equally to instruments measured at amortized cost and to debt instruments measured at fair value through recyclable other comprehensive income. Additionally, under IFRS 9, equity instruments are no longer impaired since they are either measured at fair value through profit or loss or at fair value through non-recyclable other comprehensive income. Under IAS 39, it was forbidden to record impairments on the initial recognition of assets. An asset or group of assets could be impaired only if: there was objective evidence of impairment resulting from one a or more events that had occurred since the initial recognition of the asset (i.e. loss events); and

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Breakdown of the impact of the first-time application of IFRS 9 1.2 Transitional balance sheet 1.2.1

This table gives a detailed presentation of the impact of the transition from IAS 39 to IFRS 9 on balance sheet items due to reclassifications of instruments and the application of the new impairment method.

Impact of change

Balance Sheet under IAS 39 as at December 31, 2017*

IFRS 9 reclassifi- cations and

Balance sheet under IFRS 9 at January 1, 2018

Value adjustment for credit losses (c)

Other reclassi- fications (b)

IAS 39 classification (in millions of euros)

restate- ments (a)

IFRS 9 classification

Valuation

ASSETS

ASSETS

Cash, central banks

36,901

36,901 Cash, central banks

Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss

184,497

46,184

(5,017)

(1)

225,663

Hedging derivatives

339

(1)

337 Hedging derivatives

Available-for-sale financial assets

57,885

(10,951)

(46,934)

Financial assets at fair value through equity Loans and receivables due from banks and similar items at amortized cost Loans and receivables due from customers at amortized cost Debt instruments at amortized cost Revaluation adjustment on portfolios hedged against interest rate risk

9,981

9,981

Loans and receivables due from banks

45,289

(4,278)

(446)

5

40,570

Loans and receivables due from customers

136,768

(41,920)

(10,312)

(24)

84,512

994

(10)

984

Revaluation adjustment on portfolios hedged against interest rate risk Held-to-maturity financial assets

1,885

(1,885)

Insurance business investments Current tax assets

96,901

96,901

Current tax assets Deferred tax assets

577

577

1,585

(5)

41

1,622 Deferred tax assets

Accrual accounts and other assets

Accrual accounts and other assets

46,624

(31,357)

15,267

253

Natixis Registration Document 2018