BPCE - 2018 Registration document

5 FINANCIAL REPORT

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

“Non-current assets held for sale” and “Liabilities associated with non-current assets held for sale” relate to the assets and liabilities of BPCE International’s African subsidiaries (see Note 1.3) and the assets and liabilities of the subsidiary Banco Primus. On July 19, 2017, Crédit Foncier signed a sale and purchase agreement setting out the terms of sale of its Portuguese subsidiary

Banco Primus. The completion of the sale is subject to the approval of the Portuguese supervisory authorities. The deadline was initially set at March 31, 2018, but has been postponed to April 30, 2019. Figures relating to the entities held for sale are shown below:

BPCE International African subsidiaries

12/31/2018

Other

in millions of euros

Cash and amounts due from central banks Financial assets at fair value through profit or loss

431

431

1

1

Financial assets at fair value through other comprehensive income

146

146

Securities at amortized cost

26

26

Loans and receivables due from credit institutions and similar items at amortized cost

39

2

41

Loans and receivables due from customers at amortized cost

1,363

414

1,777

Current tax assets Deferred tax assets

3

2

5

47 44 13 60

11 13

58 57 13 60

Accrued income and other assets

Investment property

Property, plant and equipment

Intangible assets

4

4

Goodwill

20

20

Non-current assets held for sale

2,197

442

2,639

Debt securities

86

86

Amounts due to credit institutions and similar items

250

250

Amounts due to customers

1,624

1,624

Current tax liabilities Deferred tax liabilities

4

4

12 83 30

12 84 32

Accrued expenses and other liabilities

1 2

Provisions

Subordinated debt

4

4

LIABILITIES ASSOCIATED WITH NON-CURRENT ASSETS HELD FOR SALE

2,089

7

2,096

At January 1, 2018, “Non-current assets held for sale” and “Liabilities associated with non-current assets held for sale” notably included the assets and liabilities of the subsidiary Banco Primus. Pursuant to IFRS 5, “Non-Current Assets Held for Sale and Discontinued Operations”, Groupe BPCE: reclassified consolidated assets in separate asset items for ● € 457 million and liability items for € 19 million;

adjusted the value of the assets to the lowest of their book value ● and their fair value less costs relating to the sale, leading to a net expense of - € 17 million, recorded under “Gains or losses on other assets”. Other non-current assets and liabilities held for sale mainly concern the Natixis group.

5.8

INVESTMENT PROPERTY

Accounting principles In accordance with IAS 40, investment property is property held to earn rent or for capital appreciation, or both.

The accounting treatment for investment property is identical to that used for property, plant and equipment for all Group entities except for certain insurance entities, which recognize the property they hold as insurance investments at fair value, with any adjustment to fair value recorded in income. Fair value is calculated using a multi-criteria approach, by capitalizing rent at market rates and through comparisons with market transactions. The fair value of the Group’s investment property is based on regular expert valuations, except in special cases significantly affecting the value of the relevant asset. Investment property leased under an operating lease may have a residual value that will reduce the depreciable amount of the asset. Gains or losses on the disposal of investment property are recognized in income on the “Net income or expenses on other activities” line, with the exception of insurance businesses, which are recognized in “Income from insurance businesses”.

302

Registration document 2018