NATIXIS_REGISTRATION_DOCUMENT_2017

FINANCIAL DATA Parent company financial statements and notes

“Other long-termbenefits” including long-service awards and deferred compensation payable in cash under Employee Retention and PerformanceRecognition plans are valued using the same actuarial method as that applied to post-employment benefits under defined-benefitplans, except that actuarial gains and losses are not subject to the corridor method and past servicecosts are recognizeddirectlyas an expense. The estimated amount of the expense related to cash-settled variable compensation, subject to the employee’s continued service in accordance with the Employee Retention and Performance Recognition plans, is recognized over the vesting period. and performance recognition plans Since 2010, Natixis has granted share-based payment plans to certain categories of staff. Some plans are settled in Natixis shares, while others are settled in cash indexed to the Natixis share price. Each plan is a three-year plan, with one-third of the plan settled each year, with the exceptionof “short-term”plans settled in cash indexed to the Natixis share price, which are settledin the year of granting. All of these plans are contingent on satisfying service and/or performancerequirements. Cash-settled employee retention and performance plans indexed to the value of the Natixis share Cash-settled plans indexed to the share price give rise to the recognitionof a payroll expense that is measuredtaking account of the share price on the balancesheet date and the likelihoodof satisfying performance/and or service requirements. Where a service requirementexists, the calculatedexpense is recognized on a straight-linebasis over the vesting period. When no service requirementexists, the expense is recognized immediatelyas a debt. The latter is then remeasuredat each reportingdate taking into accountperformancecriteriaand any changesin the value of underlyingshares. The corresponding expense recognized in the 2017 income statementwas €42.1 millionversus€33.8 millionat December 31, 2016. Changesto the terms and conditionsof a cash-settledemployee retention and performance plan indexed to the value of the Natixis share which would lead to the latter being reclassifiedas an employee retention and performance plan settled in shares would trigger, when the plan provides for the allocation of existing shares, the derecognitionof the debt recorded for the initial plan indexed to the value of the Natixis share and the recognition of a liability as a provision for the new employee retentionand performanceplan settled in shares. The difference between the recognitionof the new plan and the derecognition of the preexistingdebt is taken directly to profit and loss. When the plan provides for the allocation of new shares, only the Share-based employee retention 9.

derecognitionof the debt recorded for the initial plan indexed to the value of the Natixisshare is taken to profit and loss.

Employee retention and performance plans settled in shares Plans settled in shares are recognized in accordancewith CRC RegulationNo. 2008-15,which provides for the recognitionof a liability where there is the likelihood or the certainty that the obligation to grant shares generates an outflow in settlement withoutan offsettingprovision: if the granting involves the issue of new shares, Natixis incurs a no outflowand, as a result,no expenseis recognized; if the granting involves the repurchase of shares or the a grantingof existingshares,an outflowwill be recognizedwhen the shares are issued to employees, without an offsetting provision. A provision is then set aside taking account of the entry cost of the shares or the share price on the balance sheet date if the shares have not yet been purchasedand the probable number of shares granted to employees. The expenseis recognizedin stagesover the vestingperiod. A provisionof €134,000was recordedin the financialstatements at December 31,2017 in respect of plans to be settled in shares (allocationof existingshares),against an identicalexpensein this respectin 2016. Provisions for risks 10. A provisionfor risks is a liability of uncertaintiming or amount.A liability is a present obligation arising from past events, the settlement of which is expected to result in an outflow of resources embodying economic benefits that can be reliably measured. The amount recognized as a provision should be the best estimate of the expenditure required to settle the present obligationat the reportingdate. This amount is discountedwhen the effect of discounting is material. Provisions are reviewed at each reporting date and adjusted if necessary. Provisions recognizedon the balance sheet, other than provisions to cover employeebenefits and sector and country risks, mainly concern provisions for restructuring, provisions for disputes, fines and penaltiesand provisionsfor other risks. Off-balance sheet receivables, debts and commitments denominatedin foreign currenciesare convertedto euros at the going exchange rate at the balance sheet date through the revaluationof foreignexchangepositions.The differencebetween amountsresultingfrom the valuationof euro-denominated foreign exchange positions and amounts reported in equivalent euro- denominatedforeignexchangepositionsis recordedin the income statement. However, exchange differences relating to institutional operationsare recognizedunder accrualaccounts. Transactions denominated in foreign 11. currencies

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Natixis Registration Document 2017