Universal registration document and annual financial report 2020

2020 Universal registration document and annual financial report - BNP PARIBAS246

4 Consolidated finanCial statements for the year ended 31 deCemBer 2020

Notes to the financial statements

➤ ACTUAL RATE OF RETURN ON PLAN ASSETS AND REIMBURSEMENT RIGHTS OVER THE PERIOD

In%

Year to 31 Dec. 2020

Year to 31 Dec. 2019

Range of value (reflecting the

existence of several plans in the

same country) Weighted

average rates

Range of value (reflecting the

existence of several plans in the

same country) Weighted

average rates

Belgium -3.90%/4.85% 4.30% -0.05%/19.10% 6.05%

UK -4.95%/12.10% 11.10% 3.95%/19.00% 15.65%

France 3.25%/3.35% 3.35% 3.35%/3.45% 3.45%

Switzerland 1.50%/3.25% 3.25% 2.40%/14.85% 10.90%

USA 11.75%/18.60% 14.20% 7.75%/18.00% 13.10%

Germany 0.40%/2.95% 0.55% 1.75%/9.75% 9.05%

Turkey 12.85% 12.85% 19.25% 19.25%

➤ BREAKDOWN OF PLAN ASSETS

In%

31 December 2020 31 December 2019

Govern- mental

bonds Non-Govern-

mental bonds Real-

estate Deposit

account Others Shares

Govern- mental

bonds

Non-Go- vernmental

bonds Real-

estate Deposit

account Others

Belgium 6% 52% 17% 1% 0% 24% 6% 54% 15% 1% 0% 24%

UK 8% 72% 8% 0% 1% 11% 14% 66% 8% 0% 4% 8%

France(1) 5% 72% 15% 8% 0% 0% 6% 69% 17% 8% 0% 0%

Switzerland 36% 0% 26% 20% 4% 14% 34% 0% 29% 19% 5% 13%

USA 23% 15% 55% 0% 3% 4% 26% 44% 17% 0% 9% 4%

Germany 26% 64% 0% 0% 1% 9% 26% 64% 0% 0% 1% 9%

Turkey 0% 0% 0% 4% 94% 2% 0% 0% 49% 4% 42% 5%

Others 9% 15% 11% 1% 3% 61% 9% 14% 12% 1% 3% 61%

GROUP 11% 47% 17% 4% 5% 16% 13% 47% 17% 4% 4% 15%

(1) In France, the breakdown of plan assets reflects the breakdown of the general fund of the insurance company through which the Group s obligations are funded.

The Group introduced an asset management governance for assets backing defined-benefit pension plan commitments, the main objectives of which are the management and control of the risks in terms of investment.

It sets out investment principles, in particular, by defining an investment strategy for plan assets, based on financial objectives and financial Risk Management, to specify the way in which plan assets have to be managed, via financial management servicing contracts.

The investment strategy is based on an assets and liabilities management analysis that should be realised at least every three years for plans with assets in excess of EUR 100 million.

Post-employment healthcare benefits

The Group offers some healthcare benefit plans for retired employees, mainly in the United States and Belgium. These plans are mainly closed to new entrants.

The present value of post-employment healthcare benefit obligations stood at EUR 148 million at 31 December 2020, compared with EUR 146 million at 31 December 2019, i.e. an increase of EUR 2 million in 2020, recognised directly in shareholders equity.

6.c OTHER LONG-TERM BENEFITS BNP Paribas offers its employees various long-term benefits, mainly long- service awards, the ability to save up paid annual leave in time savings accounts, and certain guarantees protecting them in the event they become incapacitated. The net provision amounted to EUR 443 million at 31 December 2020 (EUR 448 million at 31 December 2019).

As part of the Group s variable compensation policy, annual deferred compensation plans are set up for certain high-performing employees or pursuant to special regulatory frameworks. Under these plans, payment is deferred over time and is subject to the performance achieved by the business lines, divisions and Group.