2020 Universal registration document and annual financial report - BNP PARIBAS206
4 Consolidated finanCial statements for the year ended 31 deCemBer 2020
4
Notes to the financial statements
Note 4 NOTES TO THE BALANCE SHEET AT 31 DECEMBER 2020
4.a FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
Financial assets and liabilities at fair value through profit or loss
Financial assets and financial liabilities at fair value through profit or loss consist of held-for-trading transactions including derivatives -, of certain liabilities designated by the Group as at fair value through profit or loss at the time of issuance and of non-trading instruments which characteristics prevent their accounting at amortised cost or at fair value through equity.
In millions of euros
31 December 2020 31 December 2019
Financial instruments
held for trading
Financial instruments
designated as at fair
value through
profit or loss
Other financial assets at fair value
through profit or loss Total
Financial instruments
held for trading
Financial instruments
designated as at fair
value through
profit or loss
Other financial assets at fair value
through profit or loss Total
Securities 160,632 347 6,948 167,927 124,224 7,711 131,935 Loans and repurchase agreements 243,938 940 244,878 195,554 1,373 196,927 FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS 404,570 347 7,888 412,805 319,778 - 9,084 328,862 Securities 94,263 94,263 65,490 65,490 Deposits and repurchase agreements 286,741 1,854 288,595 212,712 2,381 215,093 Issued debt securities (note 4.h) 64,048 64,048 63,758 63,758
of which subordinated debt 851 851 893 893 of which non subordinated debt 56,882 56,882 56,636 56,636 of which debt representative of shares of consolidated funds held by third parties 6,315 6,315 6,229 6,229
FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS 381,004 65,902 446,906 278,202 66,139 344,341
Detail of these assets and liabilities is provided in note 4.d.
Financial liabilities designated as at fair value through profit or loss Financial liabilities at fair value through profit or loss mainly consist of issued debt securities, originated and structured on behalf of customers, where the risk exposure is managed in combination with the hedging strategy. These types of issued debt securities contain significant embedded derivatives, which changes in value may be compensated by changes in the value of economic hedging derivatives.
The redemption value of debt issued and designated as at fair value through profit or loss at 31 December 2020 was EUR 60,065 million (EUR 58,729 million at 31 December 2019).
Other financial assets measured at fair value through profit or loss Other financial assets at fair value through profit or loss are financial assets not held for trading:
■ debt instruments that do not meet the criteria defined by IFRS 9 to be classified as financial instruments at fair value through equity or at amortised cost :
■ their business model is not to collect contractual cash flows nor collect contractual cash flows and sell the instruments , and/or
■ their cash flows are not solely repayments of principal and interest on the principal amount outstanding;
■ equity instruments that the Group did not choose to classify as at fair value through equity .
Derivative financial instruments
The majority of derivative financial instruments held for trading are related to transactions initiated for trading purposes. They may result from market-making or arbitrage activities. BNP Paribas actively trades in derivatives. Transactions include trades in ordinary instruments such as credit default swaps, and structured transactions with complex risk profiles tailored to meet the needs of its customers. The net position is in all cases subject to limits.
Some derivative instruments are also contracted to hedge financial assets or financial liabilities for which the Group has not documented a hedging relationship, or which do not qualify for hedge accounting under IFRS.
