SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT AND HALF YEAR FINANCIAL REPORT TH FILED WITH THE AMF ON JULY, 31 2017 Registration document and annual financial report filed with the AMF (Autorité des Marchés Financiers) on March 7, 2017 under No. D.17-0132. First update filed with the AMF (Autorité des Marchés Financiers) on May 3, 2017 under No. D.17-0132-A01. The English language version of this report is a free translation from the original, which was prepared in French. All possible care has been taken to ensure that the translation is accurate presentation of the original. However, in all matters of interpretation, views or opinion expressed in the original language version of the document in French take precedence over the translation. Société anonyme (Public Limited Company) with capital of 2,496,865,996 euros Head office : 16 boulevard des Italiens, 75009 PARIS R.C.S.: PARIS 662 042 449 BNP PARIBAS – SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT 1. HALF YEAR MANAGEMENT REPORT ...................................................................................................... 3 2. GOVERNANCE ........................................................................................................................................... 72 3. FINANCIAL INFORMATION AS AT 30 JUNE 2017 .................................................................................. 73 4. RISKS AND CAPITAL ADEQUACY – PILLAR 3 [NON AUDITED] ........................................................ 158 5. ADDITIONAL INFORMATION .................................................................................................................. 183 6. STATUTORY AUDITORS ......................................................................................................................... 194 7. PERSON RESPONSIBLE FOR THE UPDATE TO THE REGISTRATION DOCUMENT ....................... 195 8. TABLE OF CONCORDANCE................................................................................................................... 196 Only the French version of the second update to the 2016 Registration document has been submitted to the AMF. It is therefore the only version that is binding in law. The original document was filed with the AMF (French Securities Regulator) on 31th July 2017, in accordance with article 212–13 of the AMF’s General Regulations. It may be used in support of a financial transaction only if supplemented by a Transaction Note that has received approval from the AMF. This document was prepared by the issuer and its signatories assume responsibility for it. 2 BNP PARIBAS – SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT 1. Half year management report 1.1 Group presentation BNP Paribas, Europe's leading provider of banking and financial services, has four domestic retail banking markets in Europe, namely in Belgium, France, Italy and Luxembourg. It operates in 74 countries and has more than 190,000 employees, including close to 145,000 in Europe. BNP Paribas holds key positions in its two main businesses: . Retail Banking and Services, which includes: Domestic Markets, comprising: - French Retail Banking (FRB); - BNL banca commerciale (BNL bc), Italian retail banking; - Belgian Retail Banking (BRB); - Other Domestic Markets activities including Luxembourg Retail Banking (LRB) International Financial Services, comprising: - Europe-Mediterranean; - BancWest; - Personal Finance; - Insurance; - Wealth and Asset Management; . Corporate and Institutional Banking (CIB). Corporate Banking; Global Markets; Securities Services. BNP Paribas SA is the parent company of the BNP Paribas Group. 3 BNP PARIBAS – SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT 1.2 First half 2017 results VERY GOOD OPERATING PERFORMANCE IN THE FIRST SEMESTER BNP Paribas delivered a very good operating performance this semester in an improving economic environment in Europe. Revenues totalled 22,235 million euros, up by 0.3% compared to the first half 2016. They included the exceptional impact of -207 million euros in Own Credit Adjustment (OCA) and own credit risk included in derivatives (DVA) (compared to +161 million euros in the first half 2016) as well as a total of +233 million euros in capital gains from the sale of Shinhan and Euronext shares. They included in the first half 2016 a +597 million euros capital gain from the sale of Visa Europe shares. The revenues of the operating divisions grew by 4.7%. They were down slightly by 0.3% at Domestic Markets1 due to the low interest rate environment, partly offset by good business development, rose by 4.5% at International Financial Services which benefitted from a good business drive and were up sharply by 11.8% at CIB whose market environment was challenging at the beginning of 2016. At 15,190 million euros, operating expenses were up by 3.2% compared to the first half 2016. They included the exceptional 36 million euro impact of the acquisitions’ restructuring costs2 (74 million euros in the first half 2016) as well as 243 million euros in transformation costs of businesses (80 million euros in the first half 2016), which amount was still limited this semester due to the gradual launch of the 2020 transformation plan programs. Operating expenses included 1,067 million euros in banking taxes and contributions (989 million euros in the first half 2016), mainly booked in the first quarter for the entire year pursuant to IFRIC 21 “Taxes”. The operating expenses of the operating divisions rose by 2.4% compared to the first half 2016: +1.9% for Domestic Markets1, +2.7% for International Financial Services and +2.8% for CIB. They included the impact of the application of IFRIC 21 recalled above. The gross operating income of the Group was thus down by 5.4%, to 7,045 million euros. It was up by 9.5% for the operating divisions. The cost of risk was at a low level, at 1,254 million euros (1,548 million euros in the first half 2016) or 34 basis points of outstanding customer loans. This 19.0% decline reflects in particular the good control of risk at loan origination, the low interest rate environment and the continued improvement in Italy as a result in particular to the repositioning on the better corporate clients. The Group’s operating income was down by 1.9%, at 5,791 million euros (5,901 million euros in the first half 2016). It was up by 20.3% for the operating divisions. Non operating items totalled 424 million euros (262 million euros in the first half 2016 which included share depreciations). Pre-tax income thus came to 6,215 million euros compared to 6,163 million euros in the first half 2016 (+0.8%). It was up sharply by 20.9% for the operating divisions. Net income attributable to equity holders was 4,290 million euros, down by 1.9% compared to the first half 2016. Excluding the effect of one-off items3, it came to 4,384 million euros, up sharply by 15.5%, reflecting the Group’s very good operating performance in the first half of the year. 1 Including 100% of Private Banking in the domestic networks (excluding PEL/CEL effects) 2 In particular, LaSer, Bank BGZ, DAB Bank and GE LLD 3 Effect of exceptional items after tax: -94 million euros (+578 million euros in the first half of 2016) 4 BNP PARIBAS – SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT The annualised return on equity was 10.6%. The annualised return on tangible equity came to 12.5%. As at 30 June 2017, the fully loaded Basel 3 common equity Tier 1 ratio1 was 11.7% (11.5% as at 31 December 2016). The fully loaded Basel 3 leverage ratio2 came to 4.2%. The Liquidity Coverage Ratio was 116% as at 30 June 2017. Lastly, the Group’s immediately available liquidity reserve was 344 billion euros (305 billion euros as at 31 December 2016), equivalent to over one year of room to manoeuvre in terms of wholesale funding. The net book value per share reached 73.3 euros, equivalent to a compounded annual growth rate of 5.7% since 31 December 2008, illustrating the continuous value creation throughout the cycle. The €2.70 dividend per share was paid entirely in cash on 1st June 2017. The Group is actively implementing the 2020 transformation plan, an ambitious programme of new customer experience, digital transformation and operating efficiency. It also continues to reinforce its internal control and compliance systems. Lastly, it is carrying out an ambitious corporate social policy of engagement in the society aimed at financing the economy in an ethical manner, being a positive agent for change, developing our people and engaging, and combating climate change: the Group just decided to create a Company Engagement Department, that will be represented in the Group Executive Committee, in order to strengthen its actions in this area. 1 Ratio taking into account all the CRD4 rules with no transitory provisions 2 Ratio taking into account all the rules of the CRD4 at 2019 with no transitory provisions, calculated according to the delegated act of the European Commission dated 10 October 2014 5 BNP PARIBAS – SECOND UPDATE TO THE 2016 REGISTRATION DOCUMENT RETAIL BANKING & SERVICES DOMESTIC MARKETS Domestic Markets reported a good business drive. Outstanding loans were up by 5.5% compared to the first half 2016 with good growth in loans in the retail banking networks and in the specialised businesses. Deposits were up by 9.1% with sharp rise in all countries. Private banking reported a rise in its assets under management of +7.9% compared to the level as at 30 June 2016 and good net asset inflows (+2.8 billion euros this semester). The operating division finalised