EURONEXT_Registration_Document_2017

FINANCIAL STATEMENTS

Notes to the Consolidated Financial Statements

Note 32.3.

Currency Risk

Foreign Currency Translation Risk: The Group’s net assets are exposed to the foreign currency risk arising from the translation of assets and liabilities of subsidiaries with functional currencies other than the euro. The following table

summarises the assets and liabilities recorded in respectively GBP and USD functional currency and the related impact of a 10% in/ decrease in the currency exchange rate on balance sheet:

2017

2016

In thousands

Assets

£17,975

£52,191

Liabilities

£(3,310)

£(6,007)

Net currency position

£14,665

£46,184

Absolute impact on equity of 10% in/decrease in the currency exchange rate

€1,650

€5,405

2017

2016

In thousands

Assets

$182,147

$ -

Liabilities

$ (20,207)

$ -

Net currency position

$ 161,940

$ - € -

Absolute impact on equity of 10% in/decrease in the currency exchange rate

€13,470

monitored by using exposure limits depending on ratings assigned by rating agencies as well as the nature andmaturity of transactions. Investments of cash and cash equivalents in bank current accounts and money market instruments, such as short-term fixed and floating rate interest deposits, are strictly restricted by rules aimed at reducing credit risk: maturity of deposits is lower than six months, counterparties’ credit ratings are permanently monitored and individual counterparty limits are reviewed on a regular basis. In addition to the intrinsic creditworthiness of counterparties, the Group’s policies also prescribe the diversification of counterparties (banks, financial institutions, funds) so as to avoid a concentration of risk. Derivatives are negotiated with leading high-grade banks. The Group granted two loans in the total amount of €6.0 million, recorded as non-current other receivable. The loans have a maturity of 5 years and bear interest rate of EURIBOR 6 months plus an average margin of 4.5%. The credit risk is closely monitored by analysing financial information. In addition, the Group is exposed to credit risk with its customers on trade receivables. Most customers of the Group are leading financial institutions that are highly rated.

Most operating revenue and expenses in the various subsidiaries of the Group are denominated in the functional currency of each relevant subsidiary. The Group’s consolidated income statement is exposed to foreign currency risk arising from receivables and payables denominated in currencies different from the functional currency of the related entity. The Groupmay use derivatives instruments designated as hedge of net investment or foreign denominated debt tomanage its net Investment exposures. The decision to hedge the exposure is considered on a case by case basis since the Group is generally exposed to major, well established and liquid currencies. The Group would, by the same token, hedge transaction risk arising fromcash flows paid or received in a currency different from the functional currency of the Group contracting entity on a case by case basis. As at 31 December 2017, the Group has not any foreign exchange rate derivatives outstanding. Note 32.4. Credit Risk The Group is exposed to credit risk in the event of a counterparty’s default. The Group’s exposure to credit risk primarily arises from the investment of cash equivalents and short-termfinancial investments. The Group limits its exposure to credit risk by rigorously selecting the counterparties with which it executes agreements. Credit risk is

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2017 REGISTRATION DOCUMENT