NATIXIS - 2018 Registration document and annual financial report

FINANCIAL DATA Parent company financial statements and notes

HIGHLIGHTS OF THE PERIOD

NOTE 2

Occurrence of an exceptional risk During the fourth quarter of 2018, Natixis recognized a decrease in earnings of €259 million in connection with its “Equity derivatives” activities, due to the occurrence of an exceptional risk related to the deterioration of the Asian markets. It emerged in the fourth quarter that, for certain specific products managed on behalf of clients in Asia, the business model used led to the introduction of a hedging strategy that proved to be inadequate in the market conditions at year-end. The products involved are indexed to the worst performance of an underlying basket of shares or index and allow investors to receive enhanced periodic coupons in return for a risk of loss of capital at maturity, with the possibility that the product may expire early. This situation explains the decrease in earnings recognized by Natixis’ Capital Markets activities in the fourth quarter of 2018, amounting to €86 million, plus €173 million of adjustments to cover the management of this stock of products. This decrease in earnings is exceptional and regards an activity whose revenues did not significantly contribute to the medium-term plan. In no way does it therefore call into question the objectives of the “New Dimension” strategic plan presented in the introduction to the registration document.

Decision to transfer some of its Specialized Financial Services (SFS) business lines to BPCE On September 12, 2018, Natixis and BPCE announced the planned sale by Natixis and acquisition by BPCE S.A. of the Factoring, Sureties & financial guarantees, Leasing, Consumer finance and Securities services business lines, for €2.7 billion. This transaction, if completed, will contribute significantly to the achievement of Natixis and BPCE’s strategic plans. In particular, it will allow Natixis to step up the development of its asset-light model and BPCE to strengthen its universal banking model. The sale should take place before the end of the first quarter of 2019, subject to the lifting of conditions precedent and in particular the completion of a capital increase by BPCE subscribed to by the Banque Populaire banks and Caisses d'Epargne and the regulatory approvals. During the fourth quarter of 2018, the operational implementation of the project was prepared and the various stages which should lead to the completion of the transaction launched.

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INTERBANK AND SIMILAR TRANSACTIONS

NOTE 3

2018

2017

(in millions of euros)

Cash and balances with central banks

23,858 84,302

36,453 98,612

Advances to banks*

Demand

3,421

4,140

Time

80,881 108,160

94,472 135,065

Interbank and similar transactions

* o/w subordinated loans

0

0

o/w reverse repurchase agreements

39,162

42,622

o/w accrued interest

148

77

Non-performing at December 31, 2018, compared with €63 million at December 31, 2017. At December 31, 2018, as at December 31, 2017, Natixis had no irrecoverable loans due from credit institutions. loans amounted to €49 million

Provisions for non-performing loans amounted to -€48 million at December 31, 2018, compared with -€61 million at December 31, 2017.

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Natixis Registration Document 2018