2020 Universal registration document and annual financial report - BNP PARIBAS 201

4Consolidated finanCial statements for the year ended 31 deCemBer 2020

4

Notes to the financial statements

Change in impairment of amortised cost financial assets during the previous period

In millions of euros

Impairment on assets subject to

12-month Expected Credit Losses

(Stage 1)

Impairment on assets subject to lifetime Expected

Credit Losses (Stage 2)

Impairment on doubtful assets

(Stage 3) Total

AT 31 DECEMBER 2018 1,549 3,302 19,511 24,362

Net allowance to impairment 123 (208) 2,667 2,582

Financial assets purchased or originated during the period 580 369 3 952

Financial assets derecognised during the period(1) (263) (483) (809) (1,555)

Transfer to stage 2 (148) 2,130 (476) 1,506

Transfer to stage 3 (17) (873) 2,267 1,377

Transfer to stage 1 150 (1,039) (79) (968)

Other allowances/reversals without stage transfer(2) (179) (312) 1,761 1,270

Impairment provisions used (2) (9) (5,549) (5,560)

Effect of exchange rate movements and other items (29) 38 18 27

AT 31 DECEMBER 2019 1,641 3,123 16,647 21,411

(1) Including disposals. (2) Including amortization.

2.i CORPORATE INCOME TAX

Reconciliation of the effective tax expense to the theoretical tax expense at standard tax rate in France

Year to 31 Dec. 2020 Year to 31 Dec. 2019

in millions of euros tax rate

in millions of euros tax rate

Corporate income tax expense on pre-tax income at standard tax rate in France(1) (3,008) 32.0% (4,003) 34.4%

Impact of differently taxed foreign profits 415 -4.4% 541 -4.7%

Impact of changes in tax rates - - 77 -0.7%

Impact of dividends and disposals taxed at reduced rate 170 -1.8% 571 -4.9%

Impact of the non-deductibility of taxes and bank levies(2) (262) 2.8% (218) 1.9%

Impact of previously unrecognised deferred taxes (tax losses and temporary differences) 94 -1.0% 76 -0.7%

Impact of using tax losses for which no deferred tax asset was previously recognised - - 4 -

Other items 184 -1.9% 141 -1.1%

Corporate income tax expense (2,407) 25.6% (2,811) 24.2%

Current tax expense for the year to 31 December (2,391) (2,615)

Deferred tax expense for the year to 31 December (note 4.k) (16) (196)

(1) Restated for the share of profits in equity-method entities and goodwill impairment. (2) Contribution to the Single Resolution Fund and other non-deductible banking taxes.