Unipol Gruppo Finanziario 2013 Consolidated Financial Statements UNIPOL GRUPPO FINANZIARIO S.P.A. _____________________________________________________________ Registered and Head Offices at Via Stalingrado 45, Bologna Share capital €3,365,292,408.03 fully paid-up Tax Code and registration number in the Bologna Business Register 00284160371 - R.E.A. No. 160304 Parent of the Unipol Insurance Group entered in the Register of Insurance Groups - No. 046 www.unipol.it 2013 Consolidated Financial Statements Bologna, 20 March 2014 CONTENTS Company bodies .......................................................................................................................... 7 Introduction Macroeconomic background and market performance ............................................................... 9 Principal new legislation ............................................................................................................ 15 Graph showing Consolidation Scope as at 31 December 2013 ............................................. 20 Graph showing Consolidation Scope as at 1 April 2014 ........................................................ 22 MANAGEMENT REPORT Preamble ...................................................................................................................................... 27 Group highlights ........................................................................................................................... 29 Management report ...................................................................................................................... 31 Salient aspects of business operations ........................................................................................ 47 Insurance Sector .......................................................................................................................... 50 Banking Sector ............................................................................................................................. 62 Real Estate Sector ....................................................................................................................... 67 Holding/Services and Other Activities Sector ............................................................................... 69 Investment management .............................................................................................................. 71 Equity ........................................................................................................................................... 76 Technical provisions and financial liabilities ................................................................................. 78 Other information Human Resources .................................................................................................................. 80 Social and environmental responsibility .................................................................................. 80 Group sales network ............................................................................................................... 84 Customers .............................................................................................................................. 85 Main environmental impacts ................................................................................................... 86 IT services .............................................................................................................................. 87 Transactions with related parties ............................................................................................ 90 Report on corporate governance and ownership structures pursuant to art. 123-bis of Legislative Decree 58 of 24 February 1998 ..................................................... 90 Significant events after the reporting period ................................................................................. 91 Business outlook............................................................... ........................................................... 95 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2013 TABLES OF CONSOLIDATED FINANCIAL STATEMENTS Statement of financial position ..................................................................................................... 98 Income statement and statement of comprehensive income ..................................................... 100 Statement of changes in equity .................................................................................................. 102 Statement of cash flows ............................................................................................................. 103 3 NOTES TO THE FINANCIAL STATEMENTS 1. Basis of presentation .............................................................................................................. 107 2. Main accounting policies ........................................................................................................ 116 3. Notes to the Statement of Financial Position ......................................................................... 144 4. Notes to the Income Statement .............................................................................................. 167 5. Other information ................................................................................................................... 174 5.1 Hedge Accounting .......................................................................................................... 174 5.2 Information relating to the actual or potential effects of netting agreements .................. 175 5.3 Earnings (loss) per share ................................................................................................ 176 5.4 Dividends ........................................................................................................................ 177 5.5 Non-current assets held for sale or disposal groups ....................................................... 177 5.6 Transactions with related parties .................................................................................... 179 5.7 Fair value measurements – IFRS 13 .............................................................................. 184 5.8 Information on personnel ................................................................................................ 187 5.9 Non-recurring significant transactions and events .......................................................... 191 5.10 Atypical and/or unusual positions or transactions ............................................................. 191 5.11 Criteria to determine the recoverable amount of goodwill with an indefinite useful life (impairment test)................ ..................................................................... ......192 5.12 Notes on Non-Life business .......................................................................................... 196 5.13 Notes on Life business ................................................................................................. 199 5.14 Risk Report ................................................................................................................... 201 TABLES APPENDED TO THE NOTES TO THE FINANCIAL STATEMENTS Consolidation scope ................................................................................................................... 222 Details of unconsolidated investments ....................................................................................... 226 Statement of financial position by business segment ................................................................. 228 Income statement by business segment .................................................................................... 229 Details of property, plant & equipment and intangible assets ..................................................... 230 Details of financial assets ........................................................................................................... 231 Details of assets and liabilities relating to contracts issued by insurance companies where the investment risk is borne by policyholders and arising from pension fund management .................................................................................... 232 Details of technical provisions – reinsurers’ share .................................................................... 233 Details of technical provisions .................................................................................................... 234 Details of financial liabilities ........................................................................................................ 235 Details of technical insurance items ........................................................................................... 236 Investment income and charges ................................................................................................ 237 Details of insurance business expenses .................................................................................... 238 Details of other consolidated comprehensive income ................................................................ 239 Details of reclassified financial assets and their effects on the income statement and comprehensive income ....................................................................................................... 240 Assets and liabilities valued at fair value on a recurring and non-recurring