VAT BE0404.476.835 3 AXA Bank Belgium 2019 IFRS Consolidated Financial Statements VAT BE0404.476.835 4 Contents CONSOLIDATED INCOME STATEMENT .................................................................................... 8 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ................................................... 16 CONSOLIDATED CASH FLOW STATEMENT ........................................................................... 18 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ............................................ 21 1 GENERAL .................................................................................................................................. 21 2 ACCOUNTING POLICIES ....................................................................................................... 21 2.1 CONSOLIDATION PRINCIPLES ....................................................................................... 21 2.2 FINANCIAL ASSETS AND LIABILITIES ......................................................................... 22 2.3 EQUITY .................................................................................................................................. 31 2.4 FINANCIAL GUARANTEES ISSUED ................................................................................ 31 2.5 FEE INCOME ......................................................................................................................... 32 2.6 FOREIGN CURRENCY TRANSLATION ........................................................................... 32 2.7 CONTINGENT ASSETS AND LIABILITIES AND PROVISIONS ................................. 33 2.8 EMPLOYEE BENEFITS ....................................................................................................... 33 2.9 INCOME TAXES .................................................................................................................... 34 2.10 PROPERTY, PLANT AND EQUIPMENT ......................................................................... 35 2.11 INTANGIBLE FIXED ASSETS ............................................................................................ 36 2.12 OTHER ASSETS AND LIABILITIES ................................................................................. 37 2.13 SUPPLEMENTARY INFORMATION ................................................................................ 37 3 APPLICATION OF IFRS BY AXA BANK BELGIUM ......................................................... 38 3.1 CHANGE IN THE ACCOUNTING POLICIES ................................................................... 38 VAT BE0404.476.835 5 3.2 APPLICATION DATES ........................................................................................................ 38 4 RISK MANAGEMENT ............................................................................................................. 40 4.1 GENERAL ............................................................................................................................... 40 4.2 CREDIT RISK ........................................................................................................................ 42 4.3 MARKET RISK ...................................................................................................................... 52 4.4 CURRENCY RISK.................................................................................................................. 55 4.5 LIQUIDITY RISK .................................................................................................................. 55 4.6 OPERATIONAL RISK .......................................................................................................... 57 4.7 CAPITAL MANAGEMENT .................................................................................................. 59 5 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES ............................................. 63 5.1 FAIR VALUE - RETAIL ACTIVITIES ................................................................................ 63 5.2 FAIR VALUE - FINANCING ACTIVITIES (TREASURY) .............................................. 63 5.3 DAY ONE RESULTS ............................................................................................................. 69 5.4 APPLICATION OF CVA AND DVA ON THE DERIVATIVE PORTFOLIO ................ 69 5.5 APPLICATION OF DVA ON EMTNS ISSUED ................................................................. 69 6 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS ........................................ 70 7 FEE AND COMMISSION INCOME (EXPENSES) .............................................................. 71 8 REALISED GAINS (LOSSES) ON FINANCIAL ASSETS AND LIABILITIES NOT MEASURED AT FAIR VALUE THROUGH PROFIT OR LOSS ................................................ 72 9 GAINS (LOSSES) ON FINANCIAL ASSETS AND LIABILITIES DESIGNATED AT FAIR VALUE THROUGH PROFIT OR LOSS .............................................................................. 73 10 GAINS (LOSSES) FROM HEDGE ACCOUNTING .............................................................. 74 11 OTHER OPERATING NET INCOME ................................................................................... 75 VAT BE0404.476.835 6 12 OPERATIONAL LEASE AGREEMENTS ............................................................................. 76 13 EMPLOYEE BENEFITS .......................................................................................................... 77 13.1 BREAKDOWN OF EMPLOYEE BENEFITS ..................................................................... 77 13.2 PENSION LIABILITIES AND OTHER BENEFITS ......................................................... 77 13.3 SHARE-BASED PAYMENTS .............................................................................................. 82 14 GENERAL AND ADMINISTRATIVE EXPENSES .............................................................. 85 15 IMPAIRMENT .......................................................................................................................... 86 16 INCOME TAXES .................................................................................................................... 102 17 CASH AND BALANCES WITH CENTRAL BANKS ........................................................ 107 18 FINANCIAL ASSETS HELD FOR TRADING ................................................................... 108 19 FINANCIAL ASSETS MEASURED AT FAIR VALUE THROUGH PROFIT OR LOSS 109 20 FINANCIAL ASSETS AT FAIR VALUE THROUGH OCI ............................................... 110 21 FINANCIAL ASSETS AT AMORTISED COST................................................................. 113 22 DERIVATIVES ...................................................................................................................... 116 23 PROPERTY, PLANT AND EQUIPMENT ......................................................................... 129 24 INTANGIBLE FIXED ASSETS ............................................................................................ 130 25 INVESTMENTS IN SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES .......... 132 26 OTHER ASSETS .................................................................................................................... 134 27 FINANCIAL LIABILITIES HELD FOR TRADING .......................................................... 135 28 FINANCIAL LIABILITIES DESIGNATED AT FAIR VALUE THROUGH PROFIT OR LOSS ................................................................................................................................................. 136 29 FINANCIAL LIABILITIES MEASURED AT AMORTISED COST ................................ 138 VAT BE0404.476.835 7 29.1 DEPOSITS ........................................................................................................................... 138 29.2 SUBORDINATED LIABILITIES ..................................................................................... 139 29.3 TLTRO-LOANS .................................................................................................................. 140 30 REPOS AND REVERSE REPOS ......................................................................................... 141 31 PROVISIONS ......................................................................................................................... 142 32 OTHER LIABILITIES .......................................................................................................... 145 33 OFFSETTING ........................................................................................................................ 146 34 CONTINGENT ASSETS AND LIABILITIES .................................................................... 150 35 EQUITY .................................................................................................................................. 153 36 PROFIT ALLOCATION AND DIVIDENDS PER SHARE .............................................. 154 37 SEGMENTED INFORMATION .......................................................................................... 155 38 RELATED-PARTY TRANSACTIONS ............................................................................... 158 39 GOVERNMENT GRANTS AND ASSISTANCE ................................................................ 161 40 FINANCIAL RELATIONSHIPS WITH AUDITORS ....................................................... 162 41 DISCONTINUED OPERATIONS ....................................................................................... 163 42 EVENTS AFTER THE BALANCE SHEET DATE