AFD - 2018 Registration document

AFD’S ANNUAL FINANCIALS STATEMENTS

Highlights of the period

7.1 Highlights of the period

7.1.1 Growth of the balance sheet At 31 December 2018, the total balance sheet stood at €44.9bn, up 10% compared to the previous year. This change mainly stems from the growth in activity, with an increase of 8% in outstanding loans on its own behalf over the period. 7.1.2 Financing of the Group’s activity To finance the growth in activity on its own behalf, in 2018 AFD made five bond issues in the form of public issues and sixteen private placements, as well as nine tap issues, for a total volume of €6.5bn. 7.1.3 Appropriation of 2017 earnings Pursuant to Article 79 of the 2001 amending Finance Bill N° 2001-1276 of 28 December 2001, the amount of the dividend paid by AFD to the French State is set by ministerial order. The 2017 financial statements were approved by the Board of Directors on 11 April 2018. The Minister of the Economy and Finance determined the 2017 dividend to be paid by AFD to the French State. It amounted to €42.9M, which equates to 20% of AFD’s net income and was paid after publication in the Official Journal. The income remaining after paying out the dividend – €171.7M – was appropriated to reserves. 7.1.4 Fisea capital increase Following the decision by the partners on 13 June 2018 to increase Fisea’s capital, AFD paid up €20.0M worth of subscribed shares. 7.1.5 End of the UES linking AFD and IEDOM Following the termination on 28 February 2018 of the UES [common works council and employment agreement] linking AFD and IEDOM, employees seconded to IEDOM by AFD and IEDOM employees seconded to AFD offices overseas were asked to choose to either (i) transfer permanently to the company to which they were seconded or (ii) transfer their contracts of employment back to the company that initially hired them. Consequently, on 28 February 2018, 59 employees opted to return to AFD and four chose to stay at IEDOM.

At 31 December 2018, the net impact of the transfer of staff between AFD and IEDOM was an increase in provisions for employee benefit obligations of €3.7M. This had no impact on 2018 earnings as these obligations were billed back to IEDOM. 7.1.6 Initial estimate of the health insurance agreement for expatriate employees Under the agreement, AFD employees working outside France are repaid a set package of health care expenses depending on the country. Both active and retired AFD employees as well as their dependants are covered by these systems. Expatriate employees are guaranteed this cover for life after retirement. The agreement and AFD’s consequent provisions only pertain to currently active employees (future retirees) and current retirees. At 31 December 2018, the initial estimate of the provisions came to €9.04M and was recorded under non-recurring income in accordance with French GAAP. 7.1.7 Accounting for credit risk provisions: change from French GAAP to IFRS On 1 January 2018, AFD Group overhauled its methods for calculating credit risk provisions. The main changes are as follows: P Financing commitments given in respect of undisbursed amounts under signed loan agreements are now taken into account; P The overhaul of the method for calculating the collective provision allocations for performing non-sovereign loans. The impact of the first-time application of the new method was reported under change of accounting methods and involved a €120M reduction in the collective provision allocations, offset in the opening shareholders’ equity at 1 January 2018 in compliance with ANC Regulation 2018-01.

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REGISTRATION DOCUMENT 2018