2019 Universal registration document and annual financial report - BNP PARIBAS 489

6information on the Parent ComPany finanCial statements at 31 deCemBer 2019

6

Notes to the parent company financial statements

Note 5 SALARIES AND EMPLOYEE BENEFITS

5.a SALARIES AND EMPLOYEE BENEFIT EXPENSES

In millions of euros Year to 31 Dec. 2019 Year to 31 Dec. 2018

Salaries (4,653) (4,012)

Tax and social security charges(1) (1,843) (1,876)

Employee profit-sharing and incentive plans (204) (228)

TOTAL SALARIES AND EMPLOYEE BENEFIT EXPENSES (6,700) (6,116)

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

For BNP Paribas SA, the Competitiveness and Employment Tax Credit (CICE) stood at EUR 35 million at 31 December 2018.

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

Headcount at 31 December 2019 31 December 2018

Employees in Metropolitan France 35,749 36,720

of which managers 25,220 25,059

Employees outside Metropolitan France 18,131 17,579

TOTAL BNP PARIBAS SA 53,880 54,299

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 national schemes.

Furthermore, since defined-benefit plans have been closed to new employees in most countries outside France, they are offered the benefit of joining 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 2019 was EUR 312 million, compared with EUR 294 million for the year 2018.

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 175 million at 31 December 2019 (against EUR 171 million at 31 December 2018), comprised of EUR 95 million for French plans and EUR 80 million for other plans.

BNP Paribas recognised EUR 310 million of retirement plan assets (recognised surplus and reimbursement rights) at 31 December 2019 as compared to EUR 264 million at 31 December 2018.

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 86% bonds, 6% equities and 8% property assets.