5592019 Universal registration document and annual financial report - BNP PARIBAS

7 a Committed Bank: information ConCerninG the eConomiC,

soCial, CiviC and environmental resPonsiBility of BnP PariBas

7

Our environmental responsibility: accelerating the ecological and energy transition

COMMITMENT 10: ENABLING OUR CLIENTS TO TRANSITION TO A LOW-CARBON ECONOMY RESPECTFUL OF THE ENVIRONMENT

The Group partners with its clients, whether individuals, businesses or investors, in their transition to a low-carbon, more eco-friendly economy. To this effect, it uses several levers to cater for their specific needs.

HELPING TO FINANCE THE ENERGY AND ENVIRONMENTAL TRANSITION

Increased support for renewable energy

At end-2019, financing for the renewable energy sector amounted to EUR 15.9 billion. The Group raised its financing target for the sector to EUR 18 billion by the end of 2021 (versus EUR 15 billion at the end of 2020).

Its teams worked alongside the consortium Eolien Maritime France consortium as a financial adviser and underwriter for France s first offshore wind farm. This will have 80 turbines with a power generation capacity of 480MW, equivalent to 20% of the energy needs of the Loire- Atlantique region and representing a total investment of EUR 2 billion. As a result, BNP Paribas is ranked in 2nd place for financing renewable energy projects in the EMEA region and is 4th internationally (Dealogic end-2019 ranking).

In parallel with these actions, BNP Paribas Cardif, the insurance subsidiary of BNP Paribas, has set itself the target of EUR 3.5 billion of green investments by the end of 2020. In two years, the insurer has more than doubled its green investments in the general funds of its home countries (France, Italy and Luxembourg).

A major player in green bonds

In 2019, the Group was the third largest global player, all currencies taken together, on the green bond market according to Dealogic. Since 2012, the Group has been joint lead manager for EUR 29.9 billion of green bonds. The amount of green bonds placed in 2019 by BNP Paribas totalled EUR 9.8 billion(1) This includes in particular its participation in:

■ the first sovereign green bond in Latin America (Chile) for EUR 1.3 billion, which will be partly used to finance renewable energy and environmental protection projects;

■ Apple s inaugural EUR 2 billion green bond, which will be used to reduce Apple s overall carbon footprint and to develop the use of more sustainable materials in its products and processes.

A key actor in the booming market of sustainability linked loans

BNP Paribas is extremely active in the new and fast-growing market of Sustainability Linked Loans (SLLs). With an SLL, the interest paid by the borrower depends on the achievement of targets linked to sustainability, particularly the environment: the interest rates are lower if the Company achieves its targets, and higher if it does not (see the other positive impact financings in Investments and financing with a positive impact, Commitment 1).

SLLs are being introduced in increasingly diverse geographic areas. BNP Paribas contributed to a first-of-its-kind in South Africa by participating in the £120 million SLL for Motus Holdings Limited, an automotive company; the interest on this loan is linked to the Company s water and energy consumption.

A EUR 2 billion green credit line of credit has also been syndicated for the Belgian chemical group Solvay. The cost of this loan is linked to a targeted reduction in its greenhouse gas emissions of 1 million tonnes by 2025.

According to Dealogic, BNP Paribas was the 2nd largest global player in green loans in 2019.

An increasingly broad portfolio of financial products to support the transition

In general, the Group is continually expanding its range of financial products linked to the energy transition for its corporate clients. Various innovative products were launched in this respect in 2019, including:

■ a EUR 174 million foreign exchange risk hedging contract for Spanish wind energy company Siemens Gamesa, linked to its ESG score as defined by the non-financial rating agency RobecoSam. This transaction reduces its exposure to foreign exchange risk on sales of its offshore wind turbines in Taiwan, while incorporating an ESG performance indicator in the rate. Failure to achieve the annual ESG score will trigger a sustainability premium which BNP Paribas has pledged to reinvest in forestry projects;

■ a EUR 500 million Schuldschein (a German variable or fixed rate loan instrument) for Austrian company Lenzing AG, the leading producer of wood-based cellulose fibres, linked to its sustainability performance as determined by the non-financial rating agency MSCI. This MSCI rating will depend, amongst other things, on the Company s environmental performance (CO2 and sulphur emissions, reduction of waste water pollution, etc.).

(1) These amounts are calculated according to the apportioned value basis method of distributing fixed income products.