Société Générale / Risk Report - Pillar III

5 CAPITAL MANAGEMENT AND ADEQUACY SCOPE OF APPLICATION – PRUDENTIAL SCOPE

SCOPE OF APPLICATION – PRUDENTIAL SCOPE 5.2

The Group’s prudential reporting scope includes all fully consolidated entities, with the exception of insurance entities, which are subject to separate capital supervision.

All of the Group’s regulated entities comply with their prudential commitments on an individual basis. Non-regulated entities outside of the scope of prudential consolidation are subject to periodic reviews, at least annually.

The following table provides the main differences between the statutory scope (consolidated Group) and the prudential scope (Banking Regulation requirements).

TABLE 1: DIFFERENCE BETWEEN STATUTORY SCOPE AND PRUDENTIAL SCOPE

Type of entity

Accounting treatment

Prudential treatment under CRR/CRD4

Entities with a finance activity

Full consolidation

Full consolidation

Entities with an Insurance activity

Full consolidation

Equity method

Holdings with a finance activity by nature

Equity method

Equity method

Joint ventures with a finance activity by nature

Equity method

Proportional consolidation

Return on assets (i.e. net income divided by the balance sheet total as per the consolidated financial statements) for Societe Generale stood at 0.24% in 2019 and 0.30% in 2018. On a prudential basis, this ratio was 0.27% in 2019 and 0.33% in 2018, calculated by dividing the Group net income by the balance sheet total for prudential purposes (datas in tables below).

The following table provides a reconciliation of the consolidated balance sheet and the accounting balance sheet within the prudential scope. The amounts presented are accounting data and not a measure of risk-weighted assets, EAD or prudential capital. Prudential filters related to entities and holdings not associated with an insurance activity are grouped together on account of their non-material weight (< 0.2%).

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| SOCIETE GENERALE GROUP | PILLAR 3 - 2020