BPCE_REGISTRATION_DOCUMENT_2017

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

MARKET RISK 7.2 Market risk refers to the possibility of financial loss due to market trends, suchas: interest rates: interest rate risk is the risk that the fair value or ● future cash flows of a financial instrument will fluctuate due to changes inmarketrates of interest; exchange rates; ● prices: market price risk is the risk of a potential loss resulting ● from changes in market prices, whetherthey are caused by factors specific to the instrument or its issuer, or by factors affecting all market traded instruments. Variable-income securities, equity derivativesand commodityderivativesare exposed to this type of risk; and more generally,any market parameterinvolved in the valuationof ● portfolios. Systems for the measurement and monitoring of market risks are presented inthe risk managementreport. The information provided in the risk management report required under IFRS 7 and relating to the management of market risk comprises: VaR forthe GroupeBPCE scope; ● the conclusions of the global stress tests. ●

7.3

INTEREST RATE RISK AND EXCHANGE

RATE RISK Interestrate risk is the risk that unfavorablechangesin interestrates will adversely impact the Group’s annual results and net worth. Exchange rate risk is the risk of losses resulting from changes in exchange rates. The Group’sapproachto the managementof overall interestrate risk and foreign exchange risk is discussed in Chapter 3 – Risk managementreport – Liquidity, interest rate and exchange rate risks. 7.4 Liquidity risk is the risk that the Group will be unable to honor its paymentcommitmentsas they fall due and replace funds when they are withdrawn. The funding proceduresand liquidity risk managementarrangements are disclosed inthe risk managementreport. Disclosures relating to the managementof liquidity risk required by IFRS 7 are provided in Chapter 3 – Risk management report – Liquidity, interestrate and foreign exchange risk. LIQUIDITY RISK

Note 8

Partnerships and associates

5

8.1

INVESTMENTS IN ASSOCIATES

Partnerships and other associates 8.1.1 The Group’s maininvestmentsin joint venturesand associatesare as follows:

12/31/2017

12/31/2016

in millionsof euros

CNP Assurances(group)

2,567

2,450

Socram Banque

76

76

EDF Investment Group(EIG)

521 145 493

524 135 410

BanqueCalédonienne d’investissement

Other

Financial sectorcompanies

3,802

3,595

Other

310 310

296 296

Non-financial companies

TOTALINVESTMENTSIN ASSOCIATES

4,112

3,891

307

Registration document 2017