NATIXIS - Universal registration document and financial report 2019

RISK FACTORS, RISK MANAGEMENT AND PILLAR III Risk management

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 risk in accordance with applicable risk mandates and limits, implementing the Natixis medium-term refinancing policy adopted by the ALM Committee, and operationally managing compliance with the regulatory liquidity ratio; the Risk Supervision Division, which is responsible for V independently evaluating the structural ALM risk monitoring system, second-level controls on cash and ALM indicators, and the approval of identified ALM methods for use in a model. A dedicated department (MARPL) is also responsible for holding a Market Risk Committee meeting to review the operational limits on banking scopes covered by risk mandates. The Risk Supervision Division also proposes the limits specified under the risk appetite system, which are validated by the Board of Directors. Targets and policy (Data certified by 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 is implemented through governance and an overall liquidity risk management and monitoring system that is adapted, shared and harmonized by all affiliates, and whose main guidelines have been set forth by Groupe BPCE’s ALM Committee. Natixis’ liquidity risk management policy is an integral part of the Group’s policy. It sets out to optimize Natixis’ activities within a clear, shared and standardized framework in terms of governance and ALM regulations, and in line with the Group’s risk constraints. Management of liquidity 3.2.7.2 and funding risk

Balance sheet 3.2.7 management

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 Asset/Liability Management Committee (ALM Committee) , which is chaired by the Chief Executive Officer and composed of the members of the Senior Management Committee in charge of Finance, Risk Supervision Division and the Corporate & Investment Banking division, the Head of the Joint Refinancing Pool, the Head of Financial Management and BPCE’s Head of Financial Management. The Committee meets every 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; validating ALM assumptions and conventions underlying V calculations for metrics used to manage and monitor ALM risks; 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. Natixis’ entire scope of consolidation for liquidity risk (excluding V insurance subsidiaries, which do not present intrinsic liquidity risks and which are monitored and managed separately in respect of ALM risks); Natixis’ entire consolidation scope for structural foreign exchange V risk. 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 Supervision Division and supervises structural ALM risks on a consolidated basis while verifying the overall consistency of the ALM system. The department is also in charge of ALM, regulatory liquidity ratios and the leverage ratio (see section 3.3.2.2) , two months and is mainly responsible for: defining and monitoring Natixis’ ALM; V The ALM Committee monitors: Natixis’ entire banking portfolio; V

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NATIXIS UNIVERSAL REGISTRATION DOCUMENT 2019