2018 Registration document and annual fi nancial report - BNP PARIBAS200
4 CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018
4
Notes to the fi nancial statements
Note 5 N OTES TO THE BALANCE SHEET AT 31 DECEMBER 2018
5.a FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS
Financial assets and liabilities at fair value through profit or loss
Financial assets and fi nancial liabilities at fair value through profi t or loss consist of held-for-trading transactions including derivatives , of certain liabilities designated by the Group as at fair value through profi t or loss at the time of issuance and of non-trading instruments whose characteristics prevent their accounting at amortised cost or at fair value through equity.
In millions of euros
31 December 2018 IFRS 9 & IFRS 15
1 January 2018 IFRS 9 & IFRS 15
Trading book
Financial instru- ments
designa- ted as at
fair value through profi t or
loss
Other fi nancial assets at fair value
through profi t or
loss Total Trading
book
Financial instru- ments
designa- ted as at
fair value through profi t or
loss
Other fi nancial assets at fair value
through profi t or
loss Total Securities 114,615 7,339 121,954 122,494 7,832 130,326 Loans and repurchase agreements 182,463 1,253 183,716 143,765 1,183 144,948 FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS 297,078 - 8,592 305,670 266,259 - 9,015 275,274 Securities 75,189 75,189 67,087 67,087 Deposits and repurchase agreements 201,705 2,334 204,039 172,147 2,498 174,645 Issued debt securities (note 5.h) 54,908 54,908 50,490 50,490
of which subordinated debt 787 787 836 836 of which non subordinated debt 48,964 48,964 47,034 47,034 of which debt representative of shares of consolidated funds held by third parties 5,157 5,157 2,620 2,620
FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS 276,894 57,242 334,136 239,234 52,988 292,222
Detail of these assets and liabilities is provided in note 5.d.
Financial liabilities designated as at fair value through profit or loss Financial liabilities at fair value through profi t or loss mainly consist of debt securities in issue, originated and structured on behalf of customers, where the risk exposure is managed in combination with the hedging strategy. These types of debt securities in issue contain significant embedded derivatives, whose 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 profi t or loss at 31 December 2018 was EUR 56,435 million (EUR 49,919 million at 1 January 2018).
Other financial assets measured at fair value through profit or loss Other fi nancial assets at fair value through profi t or loss are fi nancial assets not held for trading:
■ debt instruments that do not meet the criteria defi ned by IFRS 9 to be classifi ed as fi nancial instruments at fair value through equity or at amortised cost :
■ their business model is not to collect contractual cash fl ows nor collect contractual cash fl ows and sell the instruments , and/or
■ their cash fl ows 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 fi nancial 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 profi les 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 fi nancial assets or fi nancial liabilities for which the Group has not documented a hedging relationship, or which do not qualify for hedge accounting under IFRS.
