2020 Universal registration document and annual financial report - BNP PARIBAS 517

6information on the Parent ComPany finanCial statements at 31 deCemBer 2020

6

Notes to the parent company financial statements

Note 5 SALARIES AND EMPLOYEE BENEFITS

5.a SALARIES AND EMPLOYEE BENEFIT EXPENSE

In millions of euros Year to 31 Dec. 2020 Year to 31 Dec. 2019

Salaries (4,634) (4,653)

Tax and social security charges(1) (1,837) (1,843)

Employee profit-sharing and incentive plans (152) (204)

TOTAL SALARIES AND EMPLOYEE BENEFIT EXPENSES (6,623) (6,700)

(1) Including adjustments for actuarial gains and losses on post-employment benefits.

The following table gives the breakdown of BNP Paribas SA s headcount:

Headcount at 31 December 2020 31 December 2019

BNP Paribas Métropole 34,347 35,749

of which managers 24,877 25,220

Employees outside Metropolitan France 18,243 18,131

TOTAL BNP PARIBAS SA 52,590 53,880

5.b EMPLOYEE BENEFIT OBLIGATIONS

Post-employment benefits under defined-contribution plans

In France, BNP Paribas SA pays contributions to various nationwide basic and top-up pension plans. BNP Paribas SA has set up a funded pension plan under a company-wide agreement. Under this plan, employees will receive an annuity on retirement in addition to the pension paid by nationwide schemes.

Furthermore, since defined-benefit plans have been closed to new employees in most countries outside France, they are offered the benefit of defined-contribution pension plans. Under these plans, the Group s obligation is essentially limited to paying a percentage of the employee s annual salary into the plan.

The amount paid into defined-contribution post-employment plans in France and other countries for the year 2020 was EUR 307 million, compared with EUR 312 million for the year 2019.

Post-employment benefits under defined-benefit plans

Existing legacy defined-benefit plans within BNP Paribas SA are valued independently using actuarial techniques by applying the projected unit cost method in order to determine the expense arising from rights vested in employees and benefits payable to retired employees. The demographic and financial assumptions used to estimate the present value of these obligations and of plan assets take into account economic conditions specific to each country.

Provisions set up to cover obligations under defined-benefit post- employment plans totalled EUR 168 million at 31 December 2020 (against EUR 175 million at 31 December 2019), comprised of EUR 88 million for French plans and EUR 80 million for other plans.

BNP Paribas recognised EUR 269 million of retirement plan assets (recognised surplus and reimbursement rights) at 31 December 2020 as compared to EUR 310 million at 31 December 2019.

Pension plans and other post-employment benefits

Pension plans

In France, BNP Paribas SA pays a top-up banking industry pension arising from rights acquired to 31 December 1993 by retired employees at that date and active employees in service at that date. These residual pension obligations are covered by a provision in BNP Paribas SA s financial statements or transferred to an insurance company.

The defined-benefit plans previously granted to Group executives have all been closed and converted into top-up type schemes. The amounts to be allocated to the beneficiaries, subject to their presence within the Group at retirement, were fixed when the previous schemes were closed. These pension plans have been outsourced to insurance companies. The market value of the related plan assets in these companies balance sheets breaks down as 87% bonds, 5% equities and 8% property assets.

In BNP Paribas SA s foreign branches, pension plans are based either on pensions linked to the employee s final salary and length of service (United Kingdom), or on annual vesting of rights to a capital sum expressed as a percentage of annual salary and remunerated at a predefined rate (United States).