NATIXIS -2020 Universal Registration Document

RISK FACTORS, RISK MANAGEMENT AND PILLAR III Risk management

Balance sheet management 3.2.7 Governance and organization 3.2.7.1 structure (Data certified by the Statutory Auditors in accordance with IFRS 7) Natixis’ structural balance sheet risks are managed and monitored under the authority of the ALM Committee, which is chaired by the Chief Executive Officer and composed of the members of the Senior Management Committee in charge of the finance, risk and the CIB division, the head of the joint refinancing pool, the head of financial management of Natixis, the head of the SBSR (Structural Balance Sheet Risk) and representatives of BPCE’s financial management division and risks division. The Committeemeets every two months and is mainly responsible for: defining and monitoring Natixis’ ALM; V approving the major principles in terms of structural balance sheet V risks (structure, delegation of authority, fund transfer pricing, etc.) in compliance with the standard ALM framework set up by BPCE; the pre-validation of the ALM agreements and assumptions V underlying the calculations of structural risk management and monitoring indicators prior to examination by the Group Strategic ALM Committee of the central body; validating internal limits with respect to ALM indicators, the overall V Group limits being defined by BPCE; validating the overall funding policy in conjunction with the BPCE V ALM Committee; supervising structural balance-sheet risks, including managing V excessive leverage risk since 2015; supervising the main balance sheet aggregates and their V development. The ALM Committee monitors Natixis’ regulatory balance sheet In the interest of fulfilling its duties and in order to apply the main principles of ALM management and control, the ALM Committee delegates certain operational tasks to: the Financial Management Department, as first line of defense: V the ALM Department is responsible for updating the ALM V principles, standards, conventions and limits. It submits them to the ALM Committee for approval under the oversight of the Risk division and ensures the management of structural balance sheet risks within the overall ALM limits within its remit, including those in respect of regulatory liquidity ratios and the leverage ratio, the Treasury Department (joint refinancing pool), which comes V under the authority of the financial management department, is responsible for covering the funding requirements of the business lines, providing operational management of liquidity in accordance with applicable limits, implementing the Natixis medium-termrefinancingpolicy adopted by the ALM Committee, and operationally managing compliance with the regulatory liquidity ratio; the risk division, which is responsible for independently evaluating V the structural ALM risk monitoring system, second-level controls on cash and ALM indicators (ad hoc SBSR Department), and the approval of identified ALM methods for use in a model. The risk division also proposes the limits specified under the risk appetite system, which are validated by the Board of Directors.

Management of liquidity

3.2.7.2

and funding risk

Targets and policy (Data certifiedby the Statutory Auditors in accordance with IFRS 7) Natixis is affiliated with the central institution of the Caisses d’Epargne and the Banques Populaires banks (BPCE), as defined by the French Monetary and Financial Code. Article L.511-31 of the French Monetary and Financial Code stipulates that central institutions are credit institutions and, as such, they must oversee the cohesion of their network and ensure the proper operation of affiliated institutions and companies. To this end, they take any necessary measures, notably to guarantee the liquidity and capital adequacy of all such institutions and companies as well as the network as a whole. In light of the commitments Groupe BPCE has made to the supervisory authorities to ensure and guarantee the liquidity of the bank as lender of last resort, Natixis remains under the supervisory authority of BPCE. This supervision, under the authority of the strategic ALM Committee, is implemented through governance and an overall liquidity risk management and monitoring system that is adapted, shared and harmonized by all affiliates, including Natixis. Steered by the Group’s resilience function, it describes in particular the Group’s funding strategy. Natixis’ liquidity risk management policy is an integral part of the Group’s policy. It sets out to optimizeNatixis’ activitieswithin a clear, shared and standardized framework in terms of governance and ALM regulations, and in line with the Group’s risk constraints. Natixis’ funding structure relies on a Joint Refinancing Pool shared by Natixis and BPCE. Placed under the authority of the Group ALM Committee, this platform was implemented in 2011 in order to secure the Group’s financing and optimize the management and allocation of liquidity within the Group in accordancewith predefined rules, in particularwith the aim of limiting the use of market financing and reducing funding costs. The purpose of the overall liquidity risk management policy is to: ensure that Natixis meets its loan commitments while ensuring V that its funding needs and maturity transformationare in line with the Group’s short- and medium-term refinancing capacities; optimize funding costs within established risk constraints to help V reach profitability targets; observe the internal limits set in close cooperationwith BPCE and V adapted to the Group’s ability to meet Natixis’ ultimate liquidity needs; comply with national and international regulations; V help diversify the sources of funding raised by Groupe BPCE (by V geographic area, product and counterparty); and in particular promote inflows of non-financial resources.

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NATIXIS UNIVERSAL REGISTRATION DOCUMENT 2020