10.2020

SOCIETE GENERALE PRIVATE BANKING

Investment Solution : Tech Gem CHINA'S IMPRESSIVE ECONOMIC GROWTH

The Chinese economy represents...

1/10th the size 2000 of the US economy

1/2 the size 2010 of the US economy

2x the size 2050 of the US economy

Source BlackRock Asset Management, 31/12/2019 ?

TECH GEMS │ 10.2020 │ 2 CHINESE SINGLE’S DAY VS BLACK FRIDAY

At a time when economic growth has slowed and the global expansion cycle is maturing, it becomes all the most important to position portfolios on resilient growth avenues. The Technology (“Tech”) sector now accounts for a bit more than 15% of the MSCI Emerging markets index and over 20% including e-commerce, a level similar to that of the US and well above other developed markets indices. Not only does it offer premium growth but we also have to acknowledge that emerging markets equities look cheap relative to their developed market peers. The trade truce between US and China followed by the Phase 1 trade agreement could act as a catalyst to lift pessimism over the outlook for China and emerging markets.

Daily online sales in single day and black friday (in USD bn) 38,0

30,8

25,3 Online sales during Chinese “Singles Day” are 5x that of the US 17,8 Black Friday 14,3

9,3 5,7 3,9

2012 2013 2014 2015 2016 2017 2018 2019

Singles' Day Black Friday

Source : BlackRock Asset Management, 31/12/2019

TECH GEMS │ 10.2020 │ 3 BATX VS GAFA – TECH AT REASONABLE PRICE

From FANG To BATX = Tech at a reasonable Price EM discount to DM has considerably widened FANG (, , and Alphabet) stocks continue to be in the Technology investing has the merit of providing investors with high and recurring spotlight. Once we scratch the surface we see that Tech represent a significant growth momentum, largely immune to economic cycles. This however comes at the part within emerging markets with companies like in AI, Alibaba in e- expense of valuation premium and the Nasdaq has largely rerated over the last few commerce, in gaming and internet already own leading market years. positions. Not only China but throughout Asia, Technology leaders are on the rise.

Market capitalization in USD bn as of September 30, 2020 Nasdaq vs. MSCI Emerging Markets PER between 2010 and 2020

80 Nasdaq MSCI Emerging Markets 70 66,1 998 1951 746 1575 60

50

GOOGLE APPLE FACEBOOK AMAZON 40

30

20 20,6

10 42 749 628 64 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 BAIDU ALIBABA TENCENT

Source: Bloomberg, 30/09/2020 Source : Bloomberg, SGPWM – 31/10/2020

TECH GEMS │ 10.2020 │ 4 TECH GEMS

Participation Structured Product on a selection of Tech Emerging names

Our stock selection focuses on those key Tech companies in the Asian Emerging markets. BAIDU INC : Baidu is the largest Internet search engine in China with mid-70s mobile traffic share in the search market. The firm generates 86% of revenue from online marketing services and the rest from other segments. Baidu is a technology-driven company and has been investing in AI technology, such as autonomously driven cars.

SAMSUNG ELECTRONICS CO LTD : Samsung Electronics is a diversified electronics conglomerate that manufactures and sells a wide range of products, including , semiconductor chips, printers, home appliances, medical equipment, and telecom network equipment. About 75% of its profit is generated from semiconductor business, and a further 15%-20% is generated from its mobile handset business, although these percentages vary with the fortunes of each of these businesses. It is the largest and television manufacturer in the world, which helps provide a base demand for its component businesses, such as memory chips and displays, and is also the largest manufacturer of these globally.

ALIBABA GROUP HOLDING LTD : Alibaba is the world’s largest online and mobile commerce company, measured by GMV (CNY 5.7 trillion/$846 billion for the fiscal year ended March 2019). It operates China’s most-visited online marketplaces, including (consumer-to-consumer) and Tmall (business-to-consumer). Alibaba's China marketplaces accounted for 68% of revenue in fiscal 2019, with Taobao generating revenue through advertising and other merchant data services and Tmall deriving revenue from commission fees. Additional revenue sources include international retail/wholesale marketplaces (7%), cloud computing (7%), digital media and entertainment platforms (6%), Cainiao logistics services (4%), and innovation initiatives/other (1%). Mobile GMV accounted for roughly 85% of consolidated GMV in fiscal 2019.

TENCENT HOLDINGS LTD : Tencent is a Chinese Internet giant with businesses and investments in a wide variety of Internet services and contents. Major services include communication and social networking (Weixin/WeChat and QQ), online PC and mobile games, content (news, videos, music, comics, and literature), utilities (email, app store, mobile security, and mobile browser), the cloud, and financial technology. Tenpay in Weixin/WeChat and QQ is a payment solution that enables closed-loop transactions in Tencent’s ecosystems and has been adopted by many third-party partners and offline merchants. Tencent has an aggregate monthly active user base of over 800 million for QQ and 1 billion for Weixin/WeChat.

TAIWAN SEMICONDUCTOR MANUFACTURING CO : Taiwan Semiconductor Manufacturing is the world's largest dedicated chip foundry, with over 50% market share in 2018 (according to IC Insights). TSMC was founded in 1987 as a joint venture of Philips, the government of Taiwan, and private investors. It went public as an ADR in the U.S. in 1997. TSMC's scale and high-quality technology allow the firm to generate solid operating margins, even in the highly competitive foundry business. Furthermore, the shift to the fabless business model has created tailwinds for TSMC. The foundry leader has an illustrious customer base, including Apple and Nvidia, that looks to apply cutting-edge process technologies to its semiconductor designs.

JD.com INC : JD.com is China's second- largest e-commerce company after Alibaba in terms of transaction volume, offering a wide selection of authentic products at competitive prices, with speedy and reliable delivery. The company has built its own nationwide fulfilment infrastructure and last-mile delivery network, staffed by its own employees, which supports both its online direct sales and its online marketplace businesses. JD.com launched its online marketplace business in 2010.

Source: Bloomberg, September 2020

TECH GEMS │ 10.2020 │ 5 TECH GEMS

Performance analysis as of October 30, 2020

Tech Gem est un produit structuré de participation sur un sélection de valeurs technologiques des pays émergents asiatiques : Baidu, Samsung Electronics, Alibaba, Tencent, Taiwan Semiconductor Manufacturer et JD.com Inc.

PERFORMANCE UNDERLYING ANALYSIS

Performance YTD Tech Gems Name Country Sector Since 1 month YTD inception* 1 month 4,6% HOLDING LTD China E-commerce 3,6% 43,7% 46,9% BAIDU INC China Interactive media and services 5,1% 5,3% 12,8% 3 months 15,2% JD.com INC China E-commerce 5,0% 131,4% 96,6% SAMSUNG ELECTRONICS CO LTD South Korea Technological equipment -2,7% 3,5% 4,2% Since the beginning of the year - TAIWAN SEMICONDUCTOR MANUFACTURING CO Taiwan Semiconductors and electronic equip. 3,5% 47,6% 56,3% TENCENT HOLDINGS LTD China Interactive media and services 15,5% 57,8% 50,4% Since inception* 32,7%

140 130 120 110 100 90

80 Tech Gems

70

13/03/20 27/03/20 24/04/20 08/05/20 05/06/20 19/06/20 17/07/20 31/07/20 14/08/20 11/09/20 25/09/20 23/10/20 28/02/20 10/04/20 22/05/20 03/07/20 28/08/20 09/10/20

*Launch date: 18/02/1010 Source : Bloomberg, SGPWM – 30/10/2020

TECH GEMS │ 10.2020 │ 6 36M CUSTOM PARTICIPATION ON EW* BASKET IN USD

PRODUCT CHARACTERISTICS: 36M CUSTOM PARTICIPATION on EW* basket in USD

Target investors Investors with a propensity for high risk investments, looking for potential high returns and who can afford a loss in capital.

Anticipated scenario Increase of the underlying Risk level 0 1 2 3 4 Maturity 3 years Currency USD Nominal 2 000 000 USD Coupure 1 000 USD Initial level Closing level as observed at product launch date 100% of the positive underlying performance Participation at maturity 100% of the negative underlying performance

Weighted basket (1/6) of 6 stocks: Baidu Inc (BIDU UW), Samsung Electronics Co Ltd (005930 KP), Alibaba Group Holding Ltd (BABA UN), Underlying Tencent Holdings Ltd (700 HK), Taiwan Semiconductor Manufacturing (TSM UN) and JD.com Inc (JD UW).

Settlement Cah Issuer BNP Paribas Issuance B.V. Inception Date 18/02/2020 ISIN Code XS2074199402 *EW = equally weighted

ADVANTAGES RISKS

The potential of return at Maturity is uncapped. The capital is not guaranteed. If the underlying falls below the exercise price on the final observation date, investors may lose their investment and the product The Participation Note allows the investor to benefit from the increase of the cannot be considered a capital protection product. Underlying on the Final Observation Date. Investors bear the credit risk of the issuer and the issuer's guarantor.

If the investor sells the Note prior to the maturity date, the amount received might be lower than the initial investment depending onmarket conditions.

TECH GEMS │ 10.2020 │ 7 36M CUSTOM PARTICIPATION ON EW BASKET IN USD

MECHANISM On the final observation date, if the underlying closes at or above the initial level, then the investor receives per note: denomination × (100% + 100% of the underlying increase). Otherwise, the investor receives per note: denomination × (100% + 100% of the underlying decline). Loss of capital scenario.

ILLUSTRATIONS

SCENARIO 1 : LOSS IN CAPITAL AT MATURITY SCENARIO 2 : GAIN IN CAPITAL AT MATURITY DATE

Initial Initial level level

Initial Final Initial Final observation observation observation observation date date date date

Final Observation Date Final Observation Date The underlying closes below the initial level, the investor receives per note: The underlying closes at or above the initial level, the investor receives per denomination x (100% +100% of the underlying decline). note: denomination × (100% + 100 % of the underlying increase). Loss of capital scenario.

The figures used in this example are for illustration purpose only, the objective is to describe the mechanism of the product.

TECH GEMS │ 10.2020 │ 8 RISK FACTORS (1/2)*

Risk level UCITS Risk and Return Indicator In order to draw our clients’ attention to the risk associated with each investment This risk classification is a Synthetic Risk and Reward Indicator (SRRI) as required solution, Société Générale Private Banking has classified each product according to for UCITS. The sub-fund has been defined as an absolute performance fund under its specific risk level, on a risk scale ranging from the lowest level of risk to the the Directives of the Committee of European Securities Regulators (CESR). The highest level of risk. This risk classification represents a risk indicator internal to SRRI has been calculated based on the monthly historic volatility over five years of Société Générale Private Banking. There are five risk levels, from R0 (the lowest level portfolios managed under the same strategy. The SRRI of UCITS must be of risk) to R4 (the highest level of risk): calculated using the annualised volatility intervals shown below. These volatility intervals reflect the increasing level of risk borne by the fund and, therefore, its position in the risk scale. Risk Profile Risk of capital loss in normal market conditions 1 Less than 0,50 % R0 Secure 0% of the investment 2 Equal to or above 0,50 % and less than 2 % 3 Equal to or above 2 % and less than 5 % R1 Defensive < 5% of the investment 4 Equal to or above 5 % and less than 10 % 5 Equal to or above 10 % and less than 15 % R2 Balanced < 15% of the investment 6 Equal to or above 15 % and less than 25 % R3 Dynamic < 30% of the investment 7 Above 25 % R4 Very dynamic > 30% of the investment Before investing, investors should consult the associated Key Investor Information For example, risk level R1 corresponds to a defensive risk profile. These indicators Document (KIID) of the sub-fund. are based on the 1-year 95% Value at Risk (VaR). VaR is a measurement of the maximum amount a portfolio could lose under normal market conditions over a given period with a given probability. If the 1-year 95% VaR amounts to x%, this means that there is a 95% probability that the portfolio will not lose more than x% of its value in one year

*This document does not list all the risks (or other studies) that would be likely to influence the investor to complete a transaction. Investors should consult their own advisors.

TECH GEMS │ 10.2020 │ 9 RISK FACTORS (2/2)*

Potential investment risks: Capital loss risk, equity risk, interest risk, risk linked to small and mid capitalisation, credit risk, counterparty risk, risk linked to discretionary management and exchange rate.

Issuer’s credit risk: Investors bear the issuer’s credit risk. Prospective investors should be aware that they are exposed to the credit risk of the issuer throughout the term of the product. The redemption at maturity of such product is subject to the non-occurrence of any credit event or default affecting the issuer and/or guarantor (if any) until the product maturity.

Credit ratings: The credit rating of the issuer, and/or the guarantor (if any), should not be deemed an indication of the future credit rating of the issuer, and/or the guarantor (if any), as it may be subject to fluctuations during the product lifecycle. Credit ratings may be lowered or withdrawn without notice.

Marked-to-market value: This product may be volatile. Marked-to-market value of the product may strongly be affected by the evolution of market conditions such as, inter alia, the price of the underlying asset, interest rates, dividends, volatility. Moreover, a decline in the issuers’ creditworthiness will reduce the market value of the product.

Underlying asset: Investors are exposed to the performance of the relevant underlying asset. The product return may differ from those of the underlying it references. Investors must clearly understand the nature, characteristics, and risks inherent in the underlying asset and how the performance thereof may affect the pay-out and value of the product. Past performance of an underlying asset is not indicative of future performance. Product holders do not have any rights in respect of any underlying asset referenced by such product.

Interest-rate risk: Any sale of the bond before its maturity may result in a capital loss (or gain).

Liquidity risk: Investors' attention is drawn to the potential problems they may encounter if they want to sell their securities before maturity due to a lack of liquidity, i.e. a lack of buyers.

*This document does not list all the risks (or other studies) that would be likely to influence the investor to complete a transaction. Investors should consult their own advisors.

TECH GEMS │ 10.2020 │ 10 GLOSSARY

Bond: A bond is an investment that seeks to provide a return in the form of fixed periodic payments and the eventual return of principal at maturity.

Diversified funds: A diversified fund is a fund that is broadly diversified across multiple market sectors or geographic regions.

Equity funds: An equity fund is a mutual fund that invests principally in stocks. It can be actively or passively (index fund) managed. Equity funds are also known as stock funds. EM/ EC (Emerging markets/ countries): Markets/ countries in the process of rapid growth and industrialization.

ETF (Exchange-Traded Fund): A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange.

Guaranteed capital: On maturity, a capital-guaranteed structured product repays a minimum 100% of the capital invested on expiry. However, the investor bears the risk associated with the issuer of a structured product. If the issuer defaults, there is a risk of loss of capital Capital protégé : un produit à capital protégé ne garantit pas le remboursement de l’intégralité du capital investi. Le principal risque associé à ce type de produit est un risque de perte en capital, lié aux fluctuations à la hausse ou à la baisse des marchés de capitaux. Il y a un risque de perte en capital partiel ou total selon la nature de la protection.

« High Yield » bond: A bond that is rated below investment grade. These bonds have a higher risk of default or other adverse credit events, but typically pay higher yields than better quality bonds in order to make them attractive to investors. « Investment grade » bond: A rating given by rating agencies that indicates that a municipal or corporate bond has a relatively low risk of default. According to Standard & Poor classification standard, the issuer needs to obtain higher or equal to a BBB-. Issuer: In the case of a structured product, an issuer is an entity that issues and distributes investment products. An issuer may be a bank or a company created. Maturity date: Maturity or maturity date refers to the final payment date of a loan or other financial instrument, at which point the principal (and all remaining interest) is due to be paid. Money market fund: Money market funds are fixed income mutual funds that invest in debt securities characterized by short maturities and minimal credit risk. Sovereign bond: a debt security issued by a national government within a given country and denominated in a foreign currency.

Structured products: Structured products are investment solutions comprised of a number of financial instruments. They combine one or more financial assets such as equities, currencies, interest rates etc. with a more sophisticated options component. YTD : Year-to-date. Stock / Equity: A form of security that indicates the holder has a portion of ownership in a corporation is called stock.

TECH GEMS │ 10.2020 │ 11 DISCLAIMER

The purpose of the present document is to inform readers as to the investment strategies and opportunities identified by Société Générale Private Wealth Management, a wholly- owned subsidiary of Société Générale Bank & Trust, a public limited liability company incorporated under Luxembourg law, with registered office at 11 avenue Emile Reuter, L-2420 Luxembourg, and registered with the B6061 under the Luxembourg Trade and Companies Register. It is intended solely for the person to whom it is addressed and may not be communicated to third parties. It is the responsibility of each person in possession of this document to ensure they comply with all applicable legal and regulatory provisions. The price and value of financial products as well as any resulting revenues may increase or decrease. Changes in exchange rates may have a negative impact on the value, price and revenues derived from financial products denominated in a different currency. The information given here may be amended in line with market fluctuations. Potential investors are advised to read the information given in the detailed documentation on specific products (prospectus, term sheet, product sheet, etc.), notably as regards the associated risks; this documentation only having a contractual value. Past performance is not indicative of future performance. In addition, investors acknowledge that redemptions of this product are dependent on there being no credit events on or defaults by the entity which issues the product until its maturity. The services and investments referred to here may have tax, legal or accounting implications and it is important to remember that SGBT does not provide any advice in this respect. Accordingly, Société Générale Private Wealth Management recommends that investors consult a professional advisor in order to assess any fiscal, accounting or legal implications linked to their individual situation.

Société Générale Private Wealth Management 11, avenue Emile Reuter L-2420 Luxembourg

www.sgpwm.societegenerale.com

Société Anonyme – R.C.S Luxembourg B60.963 – management company licensed and supervised by the CSSF, 283, route d’Arlon L-1150 Luxembourg and subject to Chapter 15 of the Luxembourg law of 17 December 2010 relating to undertakings for collective investment, as amended.

TECH GEMS │ 10.2020 │ 12