BPCE_REGISTRATION_DOCUMENT_2017

5 FINANCIAL REPORT

IFRS Consolidated Financial Statements of Groupe BPCE as at December 31, 2017

5.8

RECLASSIFICATION OF FINANCIAL ASSETS

Portfolio of reclassified financial assets In application of the amendments to IAS 39 and IFRS 7 “Reclassificationof financial assets,” the Group reclassified some of its financial assets. No significant reclassification was carried out infiscal year 2016 or 2017.

Carrying amount

Fair value

12/31/2017

12/31/2017 12/31/2016

12/31/2016

in millions of euros

Assets reclassifiedto Loans and receivables

6,969 6,969

8,390 8,390

6,905 6,905

7,375 7,375

TOTALSECURITIES RECLASSIFIED

Change in fair value that would have been recognized if the securities had not been reclassified

Fiscal year 2017

Fiscal year 2016

in millionsof euros

Changein fair value that wouldhave been recognized in income if the securitieshad not been reclassified - that wouldhave been recognized in gains and lossesrecognizeddirectly in equityif the - securities had not been reclassified

(2)

1

604

(99)

DEFERRED TAX ASSETS AND LIABILITIES 5.9 Deferredtax assets and liabilitieson temporarydifferencesarise from the recognitionof the items listed in the statementbelow (positivefigures indicatedeferredtax assets, while negative figures in bracketsrepresent deferredtax liabilities):

12/31/2017

12/31/2016

in millionsof euros

Unrealized capital gainson UCITS

29

64

Fiscal EIGs

(123)

(198)

Provisions for employee-related liabilities Provisions for regulated home savings products

246 208 273 448

293 214 313 647

Impairment on aportfoliobasis Other non-deductibleprovisions

Changesin fair valueof financial instruments recorded in equity

(129)

(207)

Other sourcesof temporarydifferences (1) Deferredtax relatedto timing differences

264

769

1,216 2,344

1,895 2,496

Deferredtax arisingon thecapitalization oftax loss carryforwards

Unrecognizeddeferred tax assetsand liabilities NET DEFERRED TAXASSETS AND LIABILITIES

(1,166)

(1,075)

2,394

3,316

Deferred taxes recognized: as assets in the balance sheet - as liabilitiesin thebalancesheet -

3,081 (687)

4,097

(781) A deferredtax liabilityof €311 millionwas recognizedat December 31,2017 (€530 millionat December 31,2016)on certaingoodwillitemsrecordedin the UnitedStates,whichwill give rise to tax (1) amortizationover 15 years.

In 2017, the French Finance Act for 2018 and the fiscal reform in the United States allowed Groupe BPCE to revalue its net deferred tax position (seeNote 6.9): for French companies,deferredtaxes are calculatedby applyingthe ● tax rate that will be charged when the temporary difference reverses. Tax rates will be gradually lowered through to 2022 (includingthe social security contributionon profits), from 34.43% in 2018 to 25.83% in 2022 and thereafter for taxable profit taxed at the normalrate;

the US tax reformadoptedat the end of December ● a measurelimitingdeferrabletaxdeficitsandit introducesa taxsimilar to corporatetax, the Base Erosion Anti-AbuseTax. Neither of these changesweredeemedlikelyto havea significant impacton the income receivedfromthereduction in thefederaltaxrate. At December 31, 2017, deductible temporary differences, tax losses and unused tax credits for which no deferred tax asset has been recordedin the balance sheet amountedto € 4,504 million, compared with € 4,152million atDecember31, 2016. 2017also includes

286

Registration document 2017