BPCE - 2018 Registration document

FINANCIAL REPORT IFRS Consolidated Financial Statements of Groupe BPCE as at December 31, 2018

5.2.1

Financial assets at fair value through profit or loss

Accounting principles Financial assets at fair value through profit or loss are: financial assets held for trading, i.e. securities acquired or issued principally for the purpose of selling them in the near term; ● financial assets that the Group has chosen to recognize at fair value through profit or loss at inception using the fair value option ● available under IFRS 9. The qualifying criteria used when applying this option are described above; non-SPPI debt instruments; ● equity instruments measured by default at fair value through profit or loss (which are not held for trading purposes). ● These assets are measured at fair value at the date of initial recognition and at each balance sheet date. Changes in fair value over the period, interest, dividends, and gains or losses on disposals on these instruments are recognized in “Net gains or losses on financial instruments at fair value through profit or loss”, with the exception of non-SPPI debt financial assets whose interest is recorded in “Interest income”. Financial assets in the trading book mainly include proprietary securities transactions, repurchase agreements and derivative instruments contracted by the Group to manage its risk exposure. Assets designated at fair value through profit or loss IFRS 9 allows entities to designate financial assets at fair value through profit or loss on initial recognition. However, an entity’s decision to do so may not be reversed. Compliance with the criteria stipulated by the standard must be verified prior to any recognition of an instrument using the fair value option. This option may only be applied to eliminate or significantly reduce an accounting mismatch. Applying the option eliminates accounting mismatches stemming from the application of different valuation rules to instruments managed under a single strategy.

Financial assets in the trading book mainly include proprietary securities transactions, repurchase agreements and derivative instruments contracted by the Group to manage its risk exposure.

5

289

Registration document 2018