2018 REGISTRATION DOCUMENT AND ANNUAL FINANCIAL REPORT

2018 Registration document and annual fi nancial report - BNP PARIBAS212

4 CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018

Notes to the fi nancial statements

In millions of euros

Financial assets Financial liabilities

Financial instruments at fair value

through proﬁ t or loss held

for trading

Financial instruments at fair value

through proﬁ t or loss not held

for trading

Financial assets at fair value

through equity Total

Financial instruments at fair value

through proﬁ t or

loss held for trading

Financial instruments

designated as at fair

value through proﬁ t or loss Total

AT 1 JANUARY 2018 3,986 5,847 849 10,682 (10,124) (13,373) (23,497)

Purchases 474 1,000 142 1,616 -

Issues - (4,113) (4,113)

Sales (611) (748) (1,359) 295 295

Settlements(1) (158) (370) (2) (530) (746) 2,102 1,356

Transfers to level 3 621 129 3 753 (451) (1,860) (2,311)

Transfers from level 3 (1,534) (421) (44) (1,999) 662 2,067 2,729 Gains (or losses) recognised in profi t or loss with respect to transactions expired or terminated during the period (160) 206 (5) 41 (894) (551) (1,445) Gains (or losses) recognised in profi t or loss with respect to unexpired instruments at the end of the period 2,626 (6) 2,620 1,409 903 2,312 Changes in fair value of assets and liabilities recognised directly in equity

Items related to exchange rate movements 6 15 21 (110) (105) (215)

Changes in fair value of assets and liabilities recognised in equity 14 14 4 4

AT 31 DECEMBER 2018 5,250 5,652 957 11,859 (9,955) (14,930) (24,885)

(1) For the assets, includes redemptions of principal, interest payments as well as cash infl ows and outfl ows relating to derivatives. For the liabilities, includes principal redemptions, interest payments as well as cash infl ows and outfl ows relating to derivatives the fair value of which is negative.

Transfers out of Level 3 of derivatives at fair value include mainly the update of the observability tenor of certain yield curves, and of market parameters related to repurchase agreements and credit transactions but also the effect of derivatives becoming only or mainly sensitive to observable inputs due to the shortening of their lifetime.

Transfers into Level 3 of instruments at fair value refl ect the effect of the regular update of the observability zones.

Transfers have been refl ected as if they had taken place at the beginning of the reporting period.

The Level 3 fi nancial instruments may be hedged by other Level 1 and Level 2 instruments, the gains and losses of which are not shown in this table. Consequently, the gains and losses shown in this table are not representative of the gains and losses arising from management of the net risk on all these instruments.

Sensitivity of fair value to reasonably possible changes in level 3 assumptions

The following table summarises those fi nancial assets and fi nancial liabilities classifi ed as Level 3 for which alternative assumptions in one or more of the unobservable inputs would change fair value signifi cantly.

The amounts disclosed are intended to illustrate the range of possible uncertainty inherent to the judgement applied when estimating Level 3 parameters, or when selecting valuation techniques. These amounts refl ect valuation uncertainties that prevail at the measurement date, and even though such uncertainties predominantly derive from the portfolio sensitivities that prevailed at that measurement date, they are not predictive or indicative of future movements in fair value, nor do they represent the effect of market stress on the portfolio value.

Table of movements in Level 3 financial instruments

For Level 3 fi nancial instruments, the following movements occurred during the year ended 31 December 2018: