ANNUAL 2013 - Accueil · signature of a new partnership deal in Spain with Agrupacio, an insurance company in the Crédit Mutuel Group; the successful launch of the CIC Iberbanco

2013ANNUAL

2

3

ActivityA word from the Chairman .................. 5

Governance• Our business ................................... 6

• Supervisory board............................ 6

• A benchmark European player ......... 7

• In France, 5 specialist retail chains .. 8

• European presence.......................... 8

• The management team(at 31/12/2013) ............................... 9

• Structure of the COFIDISParticipations Group(at 20/01/2014) ............................. 10

Specialist shareholders• Crédit Mutuel................................. 11

• Argosyn ......................................... 12

The COFIDIS Participations Group• Online credit, where the distance

doesn't matter ............................... 13

• Sale of credit through our retailpartners......................................... 14

• Relationship excellence awardedin three European countries ........... 14

• Committed to corporate socialresponsibility ................................. 15

• Shared human resources policy ..... 15

Cycling sponsorship• Successful season ......................... 16

• Committed cycling team ................ 17

• Laurent Thirionet, setting the goldstandard in world para-cycling....... 17

Consolidatedfinancialstatements

Structure of COFIDIS Participations ......... 20

Key figures ............................................. 21

Consolidated balance sheet .................... 22

Consolidated income statement .............. 24

Net income and gains and losses directlyrecognised in equity................................ 25

Change in shareholders' equity............... 26

Cash flow statement .............................. 28

NotesIntroduction ............................................ 32

General context ...................................... 33

Accounting principles and policies .......... 38

Notes to the consolidated balance sheet . 48

Notes to off-consolidated balance sheetitems ...................................................... 63

Notes to the consolidated incomestatement ............................................... 63

Segment information .............................. 67

Employee benefits .................................. 69

Risk exposure and hedging policy ........... 72

Contents

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2013 ACTIVITY REPORT

1 Activity

A word from the Chairman .........................................................5

Governance• Our business ..........................................................................6

• Supervisory board...................................................................6

• A benchmark European player ................................................7

• In France, 5 specialist retail chains .........................................8

• European presence.................................................................8

• The management team (at 31/12/2013)..................................9

• Structure of the COFIDISParticipations Group (at 20/01/2014) ....................................10

Specialist shareholders• Crédit Mutuel........................................................................11

• Argosyn ................................................................................12

The COFIDIS Participations Group• Online credit, where the distance doesn't matter ..................13

• Sale of credit through our retail partners...............................14

• Relationship excellence awardedin three European countries ..................................................14

• Committed to corporate social responsibility .........................15

• Shared human resources policy ............................................15

Cycling sponsorship• Successful season ................................................................16

• Committed cycling team .......................................................17

• Laurent Thirionet, setting the gold standardin world para-cycling ............................................................17

4

A word fromthe ChairmanCOFIDIS Participations can be pleasedwith its annual performance, which sawa year-on-year rise in new consumercredit and further market share gains, forthe third consecutive year, although theoverall consumer credit market in Europehas declined.These results are reflected in the increasein the Group's stock of credit.

The improved performance was duenot only to the increase in the numberof customers and retail partners whocontinue to put their trust in the Group,but also to the proactive engagementof our 4,271 staff, who all work daily toensure that our customers in Europeare consistently satisfied with theirrelationship with our retail chains.

We are especially proud to have won the"Customer Service of the Year" award

this year in France and Spain, as well asthe equivalent accolade in Portugal, the"Consumer Choice" award.

2013 also saw the acquisition ofSOFEMO by COFIDIS Participations andthe development of new commercialsynergies with the Crédit Mutuel-CICGroup.

A number of developments took placeduring the year to implement thesechanges in the Group, including: thesignature of a new partnership deal inSpain with Agrupacio, an insurancecompany in the Crédit Mutuel Group; thesuccessful launch of the CIC Iberbancodirect branch with monabanq and testredemptions of receivables performeddirectly between Créatis and a smallnumber of CIC and Crédit Mutuel - Ile deFrance branches.

The IT systems for all loan activities inFrance will be converged in 2014, makingit a very significant year. The convergenceof our European subsidiaries is scheduledto take place in 2017, at which time theGroup will have a single IT system.

The successful roll-out of thisconvergence, which will mark a historicmilestone for our Group, will provide usall with good reason to be proud of theachievement.

ANNIE GAINChairman of the Board of DirectorsCOFIDIS Participations Group

5

GovernanceOperating through its four commercial brands,Cofidis, monabanq, Créatis and SOFEMO, theCOFIDIS Participations Group creates, sells andmanages a wide range of financial services,such as consumer credit, payment solutionsand banking services (current accounts,savings, online share trading and investments).

COFIDIS is backed by the experience andsolidity of its two shareholders, Crédit Mutuel,the majority shareholder, a major player inretail banking, and Argosyn*, which took overthe BtoB e-commerce and financial activitiespreviously held by the 3 Suisses InternationalGroup.

*As of 01/01/2014.

Supervisory board

COFIDIS Participations and COFIDISSA are structured as French SociétéAnonymes with a Board of Directorsand a Supervisory Board (at 01/01/2014).

Our business

Chairman:Alain FRADIN

Vice-Chairman:François MIGRAINE

Members:Nicolas THERY,Pascal LAUGEL,Stelli PREMAOR,Eric PLATIAU,Denis TERRIEN.

6 2013 ACTIVITY REPORT

7

A benchmark European player

COFIDIS France has successfully exportednot only its online credit concept, but alsothe founding values responsible for thebrand's popularity in France. High qualitycustomer relations, the focus on humanvalues, demanding professional standards

and team spirit are the hallmarks of theGroup and critical components of itssuccess in the European market. ThroughCOFIDIS, the COFIDIS ParticipationsGroup's footprint extends to eightcountries in Europe:France, Belgium, Spain, Italy, Portugal, theCzech Republic, Hungary and Slovakia.

BELGIUM

FRANCE

PORTUGAL

SPAIN

ITALY

CZECH REPUBLIC

SLOVAKIA

HUNGARY

€4,756 MILLION IN GROSSOUTSTANDING LOANS*

€2,048.1 MILLION IN FINANCING*

1,414 AVERAGE WORKFORCE


€337.19 MILLION IN FINANCING*

250 AVERAGE WORKFORCE




€280 MILLIONIN GROSSOUTSTANDING LOANS*



534 GROSS OUTSTANDING SAVINGS*

Italy




Czech Republic and Slovakia




Hungary




Belgium

€770 MILLION IN GROSSOUTSTANDING LOANS*



Portugal

€837 MILLION IN GROSSOUTSTANDING LOANS*



Spain




IN FRANCE INTERNATIONAL PRESENCE

* in M€


The management team (at 31/12/2013)

* Members of the Boardof Directors.

Annie Gain*Chairman of theBoard of Directors

Gilles Sauret*Director, COFIDIS France

Luc-Bertrand SALUSDirector, COFIDIS

International

Alain ColinDirector,

Diversified Activities

Thierry Marois*Director, Coordination

of Synergiesand Central Resources

Vincent LaurinChief Financial,

Risk and Legal Officer

Thierry Vittu*Director, Human Resources

and Communication

9

Structure of COFIDIS Participations

LEGAL ORGANISATION CHART

COFIDISSlovakia

COFIDISCzech

Republic

COFIDISBelgium

COFIDISSpain*

COFIDISItaly

COFIDISPortugal *

COFIDISHungary*

MartinterCarmen

HOLDING

BANQUE FEDERATIVEDU CREDIT MUTUEL

100%

100% 100% 100% 100% 100% 100% 100%

100%100%

100%

40.35%

5.01%

COFIDIS S.A

100 %

47.22%

7.41%

ARGOSYN

100%

at 20/1/2014

*su

ccur

sale

s

is a European Economic Interest Grouping between Cofidis (81%), monabanq (10.38%), Créatis (8.58%), Cofidis Belgium (0.01%),C2C (0.01%), Sofemo Group (0.01%) and Cofidis Italy (0.01%).


Specialist shareholders

Crédit Mutuel is a major player in retail banking with its CICsubsidiary, with more than 5,920 branches.

The Group's strategy revolves around four priorities:

BANKING AND INSURANCEThe Group's banking and insurance business offers anintegrated product line-up to meet members' banking andinsurance needs.

MUTUALIST PHILOSOPHYOur approach and actions are based on respect and trust.Members' interests take precedence in our structure.

TECHNOLOGYWe use new technologies in the service of members and thelocal banks.

LOCAL BANKINGWe build relations with our members through• independent local banks that are part of the fabric

of the local community• the use of online banking tools.

Key figures

• 78,482 employees

• 30.4 million customers in France and in Europe

• €15.2 billion in net banking income

• €669 billion in savings

• €351.2 billion in loans

11

Argosyn took over the BtoB e-commerce and financial activitiesfrom the 3 Suisses International Group.Its retail chains are growing from strength to strength withleadership positions in their markets. They are known for theircapacity for innovation and performance.

• Financial services through its Contentia (collection) and Direxi(insurance broker) subsidiaries, and its holding in the COFIDISParticipations Group (payment solutions and banking services)

• BtoB e-commerce through Bruneau, the leading Frenchoperator in the office furniture and supplies for professionalssegment.

* Minority shareholding.

Key figures

• 1,200 staff

• Present in four countries in Europe(France, Belgium, Spain and Luxembourg)

• €400 million in revenue, excluding shareholdings

ARGOSYN is founded on strong core values,enabling us to achieve our goals together, backed bythe strength of our Group.“

Connected marketing leader,insurance broker

One of the top three collectioncompanies in France

Leading e-commerce companyin France


The COFIDISParticipations GroupOnline credit, where the distance doesn't matter.

COFIDIS grew its business in Europe based on a uniqueconcept, Online credit. This robust business model calls forconstant innovation, not only to create new products andservices, but also to foster close customer relations and to stayabreast of technological developments.

The concept is based on the Group's capability to create Onlinerelations where the distance doesn't matter, generating closerelationships based on trust and aimed at delivering consistentlyexcellent customer relations management.

This know-how draws on our strong core values, which arefirmly embedded in the DNA of the Group and its subsidiaries:

• transparent relations with all stakeholders, deliveringperformance while safeguarding our spirit of enterprise;

• daring to share, surprise, take the initiative;

• showing consideration for colleagues, customers,shareholders and partners;

• disseminating the convictions, expertise and energy thatcharacterise the Group.

The COFIDIS Participations Group implements a developmentstrategy to support its growth in a constantly changing marketenvironment in France and internationally. To achieve theGroup's aims, this strategy is built around three major priorities:

• control of risk, notably through providing support for ourcustomers to manage their budgets;

• efficiency of IT tools, which is especially important since ourbusiness is conducted remotely;

• development of partnerships, which have always been centralto the Group's legacy and expertise.

13

Sale of credit through our retail partners

Diversification has become a strategically important challengefor the COFIDIS Participations Group. Our retail chains haveexpanded their range of products and services and offer theirexpertise to several hundred partners: telephone operators,distributors' networks, specialists and others.

These national brands have selected the expertise of theGroup's retail chains to offer financing solutions to theircustomers.

Another Group strength is its international reach, providing itwith the ability to support its partners in their plans to expandwithin Europe.

COFIDIS currently offers services to its partners throughthe Group's European subsidiaries across a rangeof distribution channels: in-store, specialist distributionnetworks, on line and door-to-door, a popular salesmethod in Spain and Hungary.

Relationship excellence awarded in three Europeancountries

The COFIDIS Participations Group's long track record ofexcellent customer relations distinguishes it from its competitors.Firmly committed to providing support to its customers for theireveryday needs, the core values championed in the Group'sretail chains are transparency, close relations, responsibility,human values and innovation to ensure that the excellence ofour customer relations is a major differentiating factor.

The hallmark of each of our retail chains is the close relationshipfostered with its customers, tailored to each application and toindividual situations, even when services are provided remotely.The relationship factor is a key differentiator.

The "Customer Service of the Year" awards in

2014 in both France and Spain bear testimony to

the confidence placed in COFIDIS by consumers.

They reward the Group's long-term commitment to

its customers and its policy of continuous service

optimisation. The Group also secured the equivalent

accolade in Portugal, the "Consumer Choice" award .

First and foremost, these awards are a tribute to the

work of our sales advisers who consistently strive to

develop personalised relations and provide a high

quality service to all customers.

*Credit Institution category - Inference Operations – Viséo Conseil research conducted from May to July 2013, using mystery customers, with 215 contacts by telephone, email, Internet and social networks.


Committed to corporate social responsibility

The COFIDISParticipationsGroup works topromote lasting,sustainabledevelopmentand includes thethree dimensionsof sustainabledevelopment in its

business activity: Economic, Social and Environmental.

Thus the Group has adopted five major commitments, rolled outin each of the retail chains as well as at all levels of the company,from strategy to operating practices:• Building a sustainable relationship with our customers• Supporting economic development• Promoting a policy of responsible human resources• Committed to combating exclusion• Limiting the impact of our activities on the environment

Committed to human rights and all forms of diversity, theCOFIDIS Participations Group has established partnerships witha range of organisations to help people in need. At local level,retail chains thus support many organisations, either throughfinance or the involvement of teams on the ground.

For example, the retail chainsin France signed a partnershipagreement with the Frenchregional debt support network,CRESUS (Chambre REgionnale duSUrendettement Social).

CRESUS is recognised as a public interest organisation. Itcomprises 18 associations in 14 regions in France, governedby a code of ethics and forming a local network dedicatedto providing advice and support for households in debt andpreventing financial and economic exclusion

CRESUS has lobbied for the creation of a consumer creditdatabase in France for more than 25 years, a project supportedby the COFIDIS Participations Group.

The Group has introduced a range ofmeasures to reduce its environmentalfootprint, including computerisation ofdocuments, building design in line with Frenchhigh environmental quality (HQE) standards,eco-friendly use of consumables and others.

The Group and its retail chains havealso introduced initiatives to increase staff awareness ofenvironmental issues and ensure they are actively involved in thechange process.

Shared human resources policy

Because its staff represents itsmost valuable asset, the COFIDISParticipations Group has consistentlyfocused on people. It strives toprovide support for all employeesand integrate them into theGroup community to ensure theiremployability and enhance theirmobility within the Group.In the retail chains, managers areencouraged to promote close

relationships based on independence, openness and trust.

Training is a critical component of HR policy providing theopportunity for all our staff to learn new skills and expertise andenable them to take over new duties and develop their careers.

We also pay attention to providing a stimulating workenvironment for our people and to creating a corporate culturewith strong values shared by all.

15

Cycling sponsorshipSuccessful season

The COFIDIS cycling team enjoyed several successes thisseason, with ample reason to be proud of their achievements.2013 will go down as a great sporting year with NicolasEDET taking the best climber jersey in the Vuelta and DannyNAVARRO finishing 9th in the Tour de France. The COFIDIS teamalso put in a strong performance in the Paris-Nice races, (5th outof 23, and in the Tour de France (10th out of 22).

2014 has already kicked off with excellent results. Betterpreparation during the winter months and more intensive trainingsaw the cyclists take to the winners' podium once again.Notching up more victories and more places on the winners'podium, in June 2014, the team took the lead in the FrenchCycling Cup and came top of the Europe Tour classification.

Their success is enthusiastically shared by the COFIDIS fan club,the increasing number of supporters that come out to cheer onthe team throughout France, and the employees of the COFIDISParticipations Group.


Committed cycling team

Moreover, COFIDIS has maintained its commitment to theanti-doping group in France, “Mouvement Pour un CyclismeCrédible”, formed to restore cycling's image and improve itscredibility.

COFIDIS also continues its supportfor Mécénat Chirurgie Cardiaque,which enables children fromdeveloping countries with heartmalformations to undergo surgery

in France when they lack the technical and financial means to becared for in their countries of origin.

Laurent Thirionet, setting the gold standard in worldpara-cycling

For more than 15 years, Laurent Thirionet has been a star ofworld track and road para-cycling, and has collaborated with theCOFIDIS team throughout this time.

The partnership has been an extremely fruitful one: Laurent'sstellar career includes two Paralympic titles, three goldmedals, two bronze medals, eight world titles, seven Europeanchampionship wins, a number of world records, including theworld hour record in 1999 during a 41,030 k race (a record hestill holds), as well as victories in the Cycling World Cup andFrench championship cycling.

Having achieved this remarkable record, which is practicallyunequalled in French para-sport, Laurent Thirionet decided tohang up his jersey in October 2013. Congratulations Laurentand thank you for the wonderful times!

17

2013 ACTIVITY REPORT18

2 Consolidated financial statementsat 31 December 2013

Structure of COFIDIS Participations ...............................................20

Key figures ...................................................................................21

Consolidated balance sheet ..........................................................22

Consolidated income statement ....................................................24

Net income and gains and losses directly recognised in equity .....25

Change in shareholders' equity.....................................................26

Cash flow statement ....................................................................28

1919


Structure of COFIDIS Participations

LEGAL ORGANISATION CHART

COFIDISSlovakia

COFIDISCzech

Republic

COFIDISBelgium

COFIDISSpain*

COFIDISItaly

COFIDISPortugal *

COFIDISHungary*

MartinterCarmen

HOLDING

BANQUE FEDERATIVEDU CREDIT MUTUEL

100%

100% 100% 100% 100% 100% 100% 100%

100%100%

100%

40.35%

5.01%

COFIDIS S.A

100 %

47.22%

7.41%

ARGOSYN

100%

at 20/1/2014

*su

ccur

sale

s

is a European Economic Interest Grouping between Cofidis (81%), monabanq (10.38%), Créatis (8.58%), Cofidis Belgium (0.01%),C2C (0.01%), Sofemo Group (0.01%) and Cofidis Italy (0.01%).

21

Key figures

3 110

8 532

Gross outstanding loans(in million €)

9 124 9 0809 194

9 234

2008 201220112009 2010 2008 201220112009 2010

4 251

3848

3 077

3 265

Financings

Solvency ratio(in %)

2008 201220112009 2010

9,108,91

9,50

10,00 10,05

2008 201220112009 2010

Equity incl.subordinated debts

906911

938

1 0161 067

250100 100 100

10 574

2013 2013

3 299,7

2013

9,80

2013

1 141

100100

(in million €)

(in million €)


Consolidated balance sheetBALANCE SHEET - ASSETS – In thousands of € Note 31/12/2013 31/12/2012

Cash on hand, balances at central banks IV.1 919 2,208

Financial assets recognised at fair value through profit or loss IV.2 26,840 25,724

Derivative hedging instruments IV.3 22,380 28,601

Available-for-sale financial assets IV.4 65 61

Loans and advances to credit institutions IV.5 688,783 1,417,189

Loans and advances to customers IV.6 8,969,352 7,727,554

Revaluation surplus for rate hedging portfolios IV.3 49,411 57,080

Held-to-maturity financial assets – –

Current tax assets IV.14 22,462 17,462

Deferred tax assets IV.14 104,200 113,683

Accruals and miscellaneous assets IV.7 95,274 57,484

Non-current assets intended for sale – –

Interests in affiliates – –

Investment properties – –

Tangible assets IV.8 19,769 20,451

Intangible assets IV.9 22,614 30,137

Goodwill IV.10 173,448 173,448

TOTAL ASSETS 10,195,517 9,671,081

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LIABILITIES Note 31/12/2013 31/12/2012

Central banks – –

Financial liabilities recognised at fair value through profit or loss IV.2 – –

Derivative hedging instruments IV.3 68,327 90,366

Debts to credit institutions IV.11 7,560,560 5,469,367

Debts to customers IV.12 575,003 664,918

Debts represented by a security IV.13 470,483 2,051,044

Revaluation surplus for rate hedging portfolios IV.3 – –

Current tax liabilities IV.14 21,542 16,962

Deferred tax liabilities IV.14 13,938 20,141

Accruals and miscellaneous liabilities IV.15 197,741 165,431

Debts related to non-current assets intended for sale – –

Insurance contract technical provisions – –

Provisions IV.16 31,938 22,225

Subordinated debt – –

TOTAL LIABILITIES 8,939,532 8,500,453

Equity attributable to Group shareholders IV.17 1,255,977 1,170,601

Capital and associated reserves 116,062 68,594

Consolidated reserves 1,022,690 1,000,469

Unrealised or deferred gains / losses 2,068 – 2,036

Profit for the period 115,157 103,573

Minority interests 8 27

TOTAL EQUITY 1,255,985 1,170,628

TOTAL LIABILITIES 10,195,517 9,671,081


Consolidated income statementINCOME STATEMENT - In thousands of € Note 31/12/2013 31/12/2012

Interest and similar income 1,029,166 1,008,984

Interest and similar costs – 141,256 – 160,449

Commissions (income) 229,917 217,691

Commissions (costs) – 19,889 – 20,730

Net gains / (losses) on financial instruments

recognised at fair value through profit or loss 1,053 4,316

Net gains / (losses) on available-for-sale financial assets 886 0

Income from other activities 1,923 2,591

Costs for other activities – 863 – 268

NET BANKING INCOME VI.1 1,100,937 1,052,135

General operating costs VI.2 – 544,802 – 517,496

Amortisation expense and provisions on tangible and intangible assets VI.3 – 16,187 – 13,651

GROSS OPERATING PROFIT 539,948 520,988

Cost of risk VI.4 – 366,108 – 363,368

OPERATING PROFIT 173,840 157,620

Share of net profit/(loss) of affiliates – –

Net gains or losses on other assets VI.5 – 1,732 – 492

Variations in the value of goodwill – –

PROFIT BEFORE TAXES 172,108 157,128

Tax on profits VI.6 – 56,964 – 53,577

Net profit for the year on discontinued operations or operations beingdiscontinued

NET PROFIT 115,144 103,552

Minority interests – 12 22

NET PROFIT - ATTRIBUTABLE TO GROUP SHAREHOLDERS 115,157 103,573

Earnings per share (in €): 0.54 0.53

25

Net income and gains and losses directlyrecognised in shareholders' equity

In thousands of € 31/12/2013 31/12/2012

Net profit attributable to Group shareholders 115,157 103,573

Translation adjustments – 81 (348)

Revaluation of derivative hedging instruments 4,136 6,499

Revaluation of long-term employee benefits 49 (1,454)

Revaluation of financial assets

Total gains and losses recognised directly in equity attributable to Group shareholders 4,104 4,697

Net income and gains and losses recognised directly in equity attributable to Group shareholders 119,261 108,270

Net income and gains and losses directly recognised in equity attributable to minority shareholders 189 (75)

Net income and gains and losses recognised directly in shareholders' equity 119,450 108,195

Data are presented in the amount net of tax (if applicable).


Change in shareholders' equity

In thousands of €

Capi

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Cons

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Tota

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Shareholders' equity at 1 January 2012 68,593 951,700 – 7,005 130,876 1,144,164 96 1,144,260

Allocation of 2011 income 130,876 – 130,876 0 0

Repayment of perpetual subordinatedcapital securities

– 1,746 – 1,746 – 1,746

Distribution in 2012 in respect of 2011 – 67,317 – 67,317 – 67,317

Interim dividends – 12,953 – 12,953 – 12,953

Sub-total of movements linked to relationswith shareholders

0 48,860 0 – 130,876 – 82,016 0 – 82,016

Variation in gains and losses recogniseddirectly in shareholders' equity

4,697 4,697 – 75 4,622

2012 INCOME 103,573 103,573 – 22 103,551

Sub-total 0 0 4,697 103,573 108,270 – 97 108,173

Effect of acquisitions and disposals onminority interests

0 0

Other variations 183 183 28 211

Equity at 31 December 2012 68,593 1,000,743 – 2,308 103,573 1,170,601 27 1,170,628

Effect of changes in accounting methods 0 0

Effect of correcting errors – 566 240 – 326 – 326

27

In thousands of €

Capi

tala

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soci

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Cons

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Tota

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Netp

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Equi

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Equi

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Shareholders' equity at 1 January 2013 68,593 1,000,177 – 2,068 103,573 1,170,275 27 1,170,302

Increase in share capital and share premium 47,468 47,468 47,468

Allocation of 2012 income 103,573 – 103,573 0 0

Repayment of perpetual subordinatedcapital securities

– 1,270 – 1,270 – 1,270

Distribution in 2013 in respect of 2012 – 65,635 – 65,635 – 65,635

Interim dividends – 38,577 – 38,577 – 38,577

Sub-total of movements linked to relationswith shareholders

47,468 – 1,909 0 – 103,573 – 58,014 0 – 58,014

Variation in gains and losses recogniseddirectly in shareholders' equity

4,104 4,104 202 4,306

2013 INCOME 115,157 115,157 – 13 115,144

Sub-total 0 0 4,104 115,157 119,261 189 119,450

Effect of acquisitions and disposals 24,860 24,860 24,860

Other variations – 405 – 405 – 208 – 613

Equity at 31 December 2013 140,921 997,863 2,036 115,157 1,255,977 8 1,255,985


Summary cash flow tableSUMMARY CASH FLOW TABLE in thousands of € 2013 2012

EARNINGS BEFORE TAXES 172,108 157,128

Net amortisation expense on tangible and intangible assets 13,801 13,634

Depreciation of goodwill and other assets 2,385 17

Net expenses for provisions – 10,086 – 64,025

Share of income in affiliates 0 0

+/- Net loss/net gain from investing activities 845 492

Income and expenses of financing activities 0 0

Other movements – 9,080 845

Total of non-monetary items included in net earnings before tax and other adjustments – 2,133 – 49,037

Flows from transactions with credit institutions 873,970 1,411,544

Flows from transactions with customers – 233,239 91,443

Flows from other transactions allocating financial assets or liabilities – 1,626,235 – 1,157,193

Flows from other transactions allocating non-financial assets or liabilities 32,136 28,951

Tax paid – 51,846 – 48,360

Net decrease (increase) in assets and liabilities from operating activities – 1,005,214 326,385

Total net cash flow generated from operating activities (A) – 835,239 434,477

Flows from financial assets and holdings 201,693 – 4,026

Flows from investment property 0 0

Flows from tangible and intangible assets – 9,544 – 5,554

Total cash flow generated from investment activities (B) 192,149 – 9,579

Cash flow coming from or going to shareholders – 55,224 – 76,963

Other net cash flows from financing activities 0 – 550,000

Total cash flow generated from financing activities (C) – 55,224 – 626,963

Effect of exchange rate variation and scope variation (D) – 48,002 987

Net increase (decrease) in cash and cash equivalents (A+B+C+D) – 746,316 – 201,079

29

SUMMARY CASH FLOW TABLE in thousands of € 2013 2012

Total net cash flow generated from operating activities (A) – 835,239 434,477

Total cash flow generated from investment activities (B) 192,149 – 9,579

Total cash flow generated from financing activities (C) – 55,224 – 626,963

Effect of exchange rate variation and scope variation (D) – 48,002 987

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,199,316 1,400,395

Cash on hand, balances at central banks, ICP (Assets and Liabilities) - BEGINNING OFPERIOD

2,208 3,909

Demand accounts and loans/borrowing with credit institutions - BEGINNING OF PERIOD 1,197,108 1,396,486

CASH AND CASH EQUIVALENTS AT END OF PERIOD 453,000 1,199,316

Cash on hand, balances at central banks, ICP (Assets and Liabilities) - END OF PERIOD 787 2,208

Demand accounts and loans/borrowing with credit institutions - END OF PERIOD 452,213 1,197,108

VARIATION IN NET CASH – 746,316 – 201,079


3 Notesto the 2013 consolidated financial statements for COFIDISParticipations S.A

Introduction ..................................................................................32

General context ............................................................................33

Accounting principles and policies ................................................38

Notes to the consolidated balance sheet .......................................48

Notes to off-consolidated balance sheet items..............................63

Notes to the Consolidated income statement ................................63

Segment information ....................................................................67

Employee benefits ........................................................................69

Risk exposure and hedging policy .................................................72

31

I Introduction

II General context

1 – Description of the entity2 – Significant events of the accounting

period3 – Simplified organisation chart for the

COFIDIS Participations Group at 31December 2013

4 – Events after the reporting period5 – Related party disclosures6 – Consolidation scope and methods

III Accounting principles andmethods

1 – Financial instruments2 – Deferred taxes3 – Assets4 – Goodwill5 – Provisions6 – Employee benefits7 – Equity instruments: deeply subor-

dinated notes8 – Interest income and expenses9 – Net commission income

10 – Judgements and estimates used inpreparing the financial statements

IV Notes to the Consolidatedbalance sheet

1 – Cash on hand, balances at centralbanks

2 – Financial assets and liabilitiesrecognised at fair value throughprofit or loss

3 – Derivative hedging instruments4 – Available-for-sale financial assets

5 – Loans and advances to creditinstitutions

6 – Loans and advances to customers7 – Accruals and miscellaneous assets8 – Tangible assets9 – Intangible assets

10 – Goodwill11 – Debts to credit institutions12 – Debts to customers13 – Debts represented by a security14 – Current and deferred tax assets

and liabilities15 – Accruals and miscellaneous

liabilities16 – Provisions17 – Shareholders' equity18 – Summary of financial instrument

classes by accounting categories

V Notes to off-consolidatedbalance sheet items

1 – Finance and guaranteecommitments

2 – Term financial instruments

VI Notes to the Consolidatedincome statement

1 – Net banking income2 – General operating costs3 – Amortisation expense and depre-

ciation of tangible and intangibleassets

4 – Cost of risk5 – Net gains or losses on other assets6 – Taxes7 – Auditors' fees

VII Segment information

1 – Definition of activity segmentsSegment information bygeographical area: data fromincome statement

3 – Segment information bygeographical area: data frombalance sheet

VIII Employee benefits

1 – Payroll2 – Workforce for the period3 – Post-employment benefits -

defined benefit schemes4 – Other long-term benefits5 – Actuarial assumptions6 – Reconciliation of balance sheet

provisions7 – Financial hedging of the scheme8 – Sensitivity analysis

IX Risk exposureand hedging policy

1 – Credit risk2 – Counterparty risk

for financial transactions3 – Overall interest rate and liquidity

risk4 – Foreign exchange risk

31


Notes to the 2013 consolidated financialstatementsfor COFIDIS participations S.A.I – IntroductionPursuant to Regulation (EC) 1606/2002 on the application of international accounting standards and Regulation (EC) 1126/2008 on their

adoption, the consolidated financial statements for the period have been prepared in accordance with IFRS, as adopted by the European

Union as at 31 December 2013. This IFRS framework includes IAS 1 to 41, IFRS 1 to 8 and their SIC and IFRIC interpretations adopted

at this date. No standard not adopted by the European Union has been applied. Summary documents are presented in accordance with

recommendation 2013-04 of the French national accounting standards authority (Autorité des normes comptables - ANC).

All IAS/IFRS were updated on 3 November 2008 by Regulation 1126/2008, which replaced regulation 1725/2003. This framework

is available on the European Commission web site: http://ec.europa.eu/internal_market/accounting/ias/index_en.htm

Information relating to risk management required by IFRS 7 is presented in a separate chapter in the activity report.

The Group early adopted IAS 19R - Employee Benefits - in 2012.

New accounting rules applicable from 1 January 2013

Mandatory applicationdate (reporting periods

starting on)

Consequences ofapplication

Amendment to IAS 1 – Presentation of Financial Statements:Presentation of Items of Other Comprehensive Income

01/01/2013 Limited

Amendment to IFRS 7 – Financial Instruments: Disclosures: Offsettingfinancial assets and liabilities

01/01/2013 Limited

Amendment - Annual improvements to International Financial ReportingStandards - IFRS

01/01/2013 Limited

Amendment to IAS 12 (May 2012) – Income taxes - Deferred Tax:Recovery of Underlying Assets

01/01/2013 Limited

IFRS 13 Fair Value Measurement, notably regarding measurement ofderivatives, taking into account counterparty credit risk and own creditrisk (CVA and DVA)

01/01/2013 Limited

33

II – General framework

1 – Description of the entity

The principle activity of COFIDIS

Participations SA and its subsidiaries is to

grant consumer credit and personal loans,

as well as issuing and managing payment

methods.

COFIDIS Participations SA was founded in

1982 by the 3SI Group, specialist in home-

shopping. On 23 March 2009, the Banque

Fédérative du Crédit Mutuel (BFCM) took

control of COFIDIS Participations SA of

which COFIDIS SA is the direct subsidiary.

COFIDIS Participations SA, registered

under company number 378 176 291, is

a public limited company registered and

domiciled in France. Its registered head

office is located at the following address:

Parc de la haute Borne, 61 avenue Halley,

59667 Villeneuve d’Ascq, France.

The consolidated financial statements will

be submitted for shareholder approval. They

have been prepared from the accounts at

31 December 2013 for companies included

within the scope of the Group. The financial

statements are expressed in thousands of

euro, unless otherwise indicated.

2 – Significant events of the accountingperiod

Significant events during the accounting

period are as follows:

• On 17 May 2013, BFCM reclassified

the total capital and voting rights of its

subsidiary Sofémo through a contribution

in kind to COFIDIS Participations SA.

Since the transaction was conducted

between companies under common

control, the value of the contribution

was taken to be the net book value of

the shares contributed, as stated in

the financial statements of BFCM as at

31/12/2012 (namely €47,499,480.41).

In return for the contribution, BFCM

received 15,700,799 new shares

in COFIDIS Participations SA. The

difference between the value of the

contribution (i.e. €47,499,480.41) and

the total nominal amount of the increase

in COFIDIS Participations SA's capital

(€2,355,119.85) gives a contribution

premium totalling €45,144,360.56. As

a result of the transaction, COFIDIS

Participations SA's share capital was

increased to €31,794,118.35, divided into

211,960,789 shares each with a par value

of €0.15. In accordance with the capital

contribution agreement, the expenses,

duties, taxes and fees were recognised as

a reduction from the contribution premium

in the amount of €31,477.36.

• The Board of Directors of COFIDIS

Participations SA meeting on 29 May

2013 decided to pay the remaining

dividend in respect of the 2012 financial

year in the amount of €61,429,376.87,

giving a dividend per share of €0.379

(196,259,990 shares).

• The Board of Directors of COFIDIS

Participations SA meeting on 11

July 2013 decided to pay an interim

dividend totalling €38,576,863.59,

giving a dividend per share of €0.182

(211,960,789 shares).

• Ficodis SA share capital reduction by

discharge of cumulative losses at end-

2012 amounting to ARS 601,285. On

completion of the transaction, the share

capital of Ficodis SA was reduced from

ARS 1,000,000 to ARS 398,715.

Standards and interpretations adopted by the European Union and not yet applied:

Mandatory applicationdate (reporting periods

starting on)

Consequences ofapplication

Amendment to IAS 32 – Financial Instruments: Presentation:Offsetting financial assets and liabilities

01/01/2014 Limited

IFRS 10-11-12 – IAS 28 – Standards relative to consolidationand financial information on non-consolidated entities

01/01/2014 Limited


3 – Simplified organisation chart for the COFIDIS Participations Group at 31 December 2013

COFIDIS S.A.

(subsidiary)

(subsidiary) (subsidiary) (subsidiary)

FICODIS SAArgentina

Creatis

COFIDISSlovakia

COFIDISBelgium

COFIDISCzech

Republic

COFIDISSpain

GEIESynergie

COFIDISItaly

COFIDISPortugal

COFIDISHungary

MonabanqFrance

MonabanqBelgium

Sofémo

4 – Events after the reporting period

There was no noteworthy event likely to

have a significant financial impact or of a

nature to challenge continued operation

on the reporting date for the Group's

consolidated financial statements.

5 – Related party disclosures

Parties related to the COFIDIS

Participation Group are:

– the consolidated companies,

– the company controlling COFIDIS

Participations SA (Banque

Fédérative du Crédit Mutuel),

– entities controlled by the same

parent company: the other entities

in the Crédit Mutuel Group,

– other related parties: entities of the

3 Suisses International Group,

– the principal directors of

COFIDIS Participations SA or its

shareholders.

Flows with consolidated companies

under exclusive control, considered as

related parties, are eliminated from the

consolidated accounts and are therefore

not presented below:

35

Balance sheet position in K€

TOTALParent

Company

Entitiescontrolled

by the sameparent company

Otherrelated parties

Derivative hedging instruments – Assets 21,304 23 21,281 0

Loans and advances to credit institutions 610,150 579,282 30,867 0

Accruals and miscellaneous assets 4,342 0 4,151 190

Total assets 635,795 579,305 56,300 190

Derivative hedging instruments – Liabilities 48,888 4 48,884 0

Debts to credit institutions 7,531,264 7,515,856 15,408 0

Debts represented by a security 387,088 342,088 45,000 0

Accruals and miscellaneous liabilities 16,981 0 16,667 314

Total liabilities 7,984,221 7,857,948 125,959 314

Commitments received 4,071,000 0 4,071,000 0

Commitments given 0 0 0 0

Income and expenditure in K€

TOTALParent

Company

Entitiescontrolled

by the sameparent company

Otherrelated parties

Interest and similar income 16,301 3,713 12,576 12

Net gains or losses on Commissions 185,032 – 1 187,029 – 1,997

Net gains or losses on portfolios at fair value throughprofit or loss

0 0 0 0

Gains or losses on other assets – 38 0 – 106 68

Total income 201,295 3,712 199,499 – 1,917

Interest and similar expenses 100,292 61,665 38,627 0

Operating costs 51,201 0 33,419 17,782

Total expenses 151,492 61,665 72,046 17,782

Transactions with the directors of COFIDIS Participations SA are limited exclusively to employee benefits (§ VIII).


6 – Consolidation scope and methods

6.1 Scope

The consolidated financial statements

for the COFIDIS Participations Group

bring together all the companies under

exclusive control, under joint control

or under significant influence. These

companies are respectively consolidated

according to the full consolidation,

proportionate consolidation and equity

methods.

The consolidated financial statements

include the accounts of COFIDIS

Participations SA and those of all its

subsidiaries:

List of companies Country locationConsolidation

method% holding at31/12/2013

% holding at31/12/2012

COFIDIS PARTICIPATIONS France

COFIDIS SA and branches France, Spain, Portugal, Hungary Full consolidation 99.99 99.99

FICODIS SA Argentina Full consolidation 66.00 66.00

CREATIS SA France Full consolidation 99.99 99.99

COFIDIS Belgium Belgium Full consolidation 99.99 99.99

COFIDIS Ceska Czech Republic Full consolidation 99.99 99.99

COFIDIS Spa Italy Full consolidation 99.99 99.99

COFIDIS Slovakia Slovakia Full consolidation 99.99 99.99

SYNERGIE France Full consolidation 99.98 99.98

Monabanq France France Full consolidation 99.99 99.99

Monabanq Belgium Belgium Full consolidation 99.99 99.99

Sofémo France Full consolidation 99.99

Changes in method and variation in scope

Consolidation of Sofémo as at 17 May 2013.

37

6.2 Concepts of control

In accordance with international

standards, all entities under exclusive

control, joint control or significant

influence are consolidated.

Exclusive control is presumed to exist

when COFIDIS Participations SA holds,

directly or indirectly through subsidiaries,

more than half the voting rights of an

entity, except if, under exceptional

circumstances, it can be clearly

demonstrated that this holding does not

allow control. Exclusive control also exists

when COFIDIS Participations SA, holding

half or less than half of the voting rights in

an entity, has the majority of power in the

management bodies.

Joint control is exercised in joint

companies, under which two or more joint

businesses are related by a contractual

holding establishing joint control.

Significant influence is usually evidenced

by the power to participate in the financial

and operational policies of a company,

without holding control. COFIDIS

Participations SA is presumed to have

significant influence when it directly or

indirectly holds 20% or more of the voting

rights in an entity.

6.3 Consolidation methods

Consolidation methods are fixed

respectively by standards IFRS 3 revised,

IAS 27 revised, IAS 28 and 31 and result

from the type of control exercised by

COFIDIS Participaionts SA over entities

that may be consolidated, regardless of

the nature of their business and their legal

personality:

– full consolidation, for exclusively

controlled entities, including entities

with different accounts structures,

even if their activity is not an

extension of the activity of COFIDIS

Participations SA. Full consolidation

consists of recognising the value

of each subsidiary's assets and

liabilities instead of the value of the

securities. The share of minority

interests in shareholders' equity and

in profit/(loss) appears separately

in the balance sheet and the

consolidated income statement.

– Proportionate consolidation, for

jointly controlled entities, including

entities with different accounts

structures, even if their activity is

not an extension of the activity

of COFIDIS Participations SA.

Under proportionate consolidation,

the representative fraction of its

interests in the balance sheet and in

the profit/(loss) of the consolidated

company is substituted for the

value of the securities in the parent

company’s accounts;

– the equity method, for entities

under significant influence or jointly

controlled entities. When a jointly

controlled entity is consolidated

using the equity method, the

information is disclosed in

the Notes. Under the equity

method, the Group's share in the

shareholders' equity and profit/(loss)

of the company is substituted for

the value of the securities.

6.4 Foreign currency transactions

The financial statements of COFIDIS

Participations Group are prepared in

euros. The balance sheet for foreign

subsidiaries and branches whose

functional currency is not the euro is

translated into euro at the exchange

rate on the reporting date. Items in the

income statement are translated using the

average rate for the accounting period.

Foreign currency translation adjustments

are shown for consolidated companies

that are not part of the euro zone

(COFIDIS Argentina, COFIDIS Hungary,

and COFIDIS Ceska).

For the Group's interests, foreign

currency translation adjustments are

included in shareholders' equity under

"Translation adjustments" and for third

party interests under "Minority interests".

The following parities were used to

translate the financial statements of

foreign subsidiaries and branches:


6.5 Treatment of acquisitionsand goodwill

Goodwill is the difference between the

acquisition price and the acquirer's

interest share in the fair value of the

identifiable assets and liabilities at the

acquisition date. On this date, this

difference is entered in the acquirer's

assets if it is positive and is recognised

in profit if it is negative. Goodwill is

recognised in the functional currency of

the acquired company and is converted

at the current exchange rate on the

reporting date. In accordance with revised

IFRS 3, goodwill is not depreciated but is

tested for impairment. The procedures for

performing these tests are described in

Note III.4 of the accounting principles.

Pursuant to revised IAS 27, increases

in the percentage holding in an entity

already controlled are recognised in

equity.

III - Accounting principles andmethods

1 – Financial instruments

In the 2013 consolidated financial

statements, financial assets and liabilities

are treated in accordance with the

provisions of IAS 39, as adopted by the

European Commission on 19 November

2004 and supplemented by regulations

1751/2005 dated 25 October 2005 and

1864/2005 dated 15 November 2005,

relating to the use of the "fair value

option", and by regulation 1004/2008

dated 15 October 2008, relating to the

transfer of financial assets.

Fair value is defined as the amount for

which an asset could be exchanged, or a

liability settled, between knowledgeable,

willing parties in an arm's length

transaction. The existence of quotations

published on an active market gives the

best indication of fair value for financial

instruments. In the absence of such

quotations, fair value is determined by

applying recognised valuation techniques

using "observable market data".

1.1 Securities

1.1.1 Classification of financial instru-ments

These are classified according to four

categories of assets applicable to

securities defined by IAS 39:

– financial assets at fair value through

profit or loss,

– held-to-maturity investments,

– available-for-sale financial assets,

– loans and advances.

1.1.1.1 Financial assets at fair value throughprofit or loss.

According to IAS 39, this portfolio

comprises securities where classification

as a financial asset recognised at fair

value through profit or loss results either

in a real intention to trade or an option

taken by the COFIDIS Participations

Group under the conditions described by

the standard.

Average rate 2013 Rate at end of periodRate at beginning of

periodAverage rate 2012

Argentine Peso 0.1353922 0.1112359 0.1541521 0.1692718

Czech Crown 0.0384806 0.0364604 0.0397599 0.0397683

Hungarian Florin 0.0033677 0.0033665 0.0034211 0.0034563

39

Financial assets or liabilities recognised

at fair value through profit or loss are by

nature assets or liabilities acquired or

generated principally for the purpose of

making a profit associated with short-

term price fluctuations or an arbitrage

margin.

Securities classified as financial assets

recognised at fair value through profit or

loss are initially recognised at fair value,

excluding transaction costs directly

attributable to the acquisition (which

are passed directly to profit or loss) and

including accrued coupons. They are

valued at their fair value and variations in

fair value are recognised in profit or loss.

1.1.1.2 Held-to-maturity investments

The category "Held-to-maturity

investments" includes securities with

fixed or determinable payments that the

COFIDIS Participations Group intends

and is able to hold to maturity, other than:

– those that the COFIDIS

Participations Group designates

on initial recognition as assets

recognised at fair value through

profit or loss,

– those that the COFIDIS

Participations Group designates as

available for sale,

– those that meet the definition of

loans and advances.

Securities held to maturity are initially

recognised at their acquisition price,

including transaction costs directly

attributable to the acquisition and

accrued coupons. These securities

are later recognised according to the

amortised cost method at the effective

interest rate.

If there is an objective indicator of

impairment, a depreciation is recorded

for the difference between the carrying

amount and the estimated discounted

recoverable amount at the original

effective interest rate. If it improves later,

the surplus provision is written back.

The COFIDIS Participations Group does

not hold securities falling within the "Held-

to-maturity investments" category.

1.1.1.3 Securities in the "Loans andAdvances" portfolio

The "Loans and Advances" categoryrecognises unquoted financial assetswith fixed or determinable payments.Securities are recognised at amortisedcost using the effective interest ratemethod corrected for any impairmentprovisions.

If there is an objective indicator ofimpairment loss, a depreciation mustbe recorded for the difference betweenthe carrying amount and the estimatedrecoverable amount discounted at theoriginal effective interest rate.

The COFIDIS Participations Group doesnot hold securities falling within the"Loans and Advances" category.

1.1.1.4 Available-for-sale financial assets

The "Available-for-sale financial assets"

category is defined by IAS 39 as the

default category.

According to the provisions of IAS 39,

the accounting principles for securities

classified as "Available-for-sale financial

assets" are as follows:

– securities available for sale

are initially recognised at their

acquisition price, including

transaction costs directly

attributable to the acquisition and

accrued coupons,

– accrued interest on available-for-

sale securities are carried over to

the attached advances account in

compensation for profit or loss,

– variations in fair value are

recognised in equity. In the event

of disposal, these variations are

reversed and recorded in profit

or loss. Depreciation over time of

any higher / lower value for fixed

payment securities is recognised

in profit or loss according to the

effective interest rate method,

– in the event of an objective sign

of significant or long-lasting

depreciation for equity securities,


and realised by a credit risk arising

for debt securities, the unrealised

capital loss recognised in equity is

reversed and recognised in profit

or loss for the period. If it improves

later, this depreciation is written

back through profit or loss for debt

instruments only. On the other

hand, for equity instruments, if

written back, the positive variation

in fair value is recognised in a

recyclable equity account.

1.1.2 Valuation of securities

Fair value is the valuation method

selected for all financial instruments

classified in the "Financial assets at fair

value through profit or loss" or "Available-

for-sale financial assets" categories.

Prices quoted on an active market form

the basic valuation method. By default,

the COFIDIS Participations Group uses

recognised valuation methods by referring

particularly to recent transactions.

When there is no quoted price for an

equity security and there is no recognised

valuation technique, the COFIDIS

Participations Group chooses techniques

based on objective and verifiable

indications such as determination of the

re-valued net asset or any other valuation

method for equity securities.

If no technique is able to give satisfaction,

or if the various techniques used give

estimates that are too dissimilar, the

security remains valued at cost and is

maintained in the "Available-for-sale

financial assets" category. However, if

such a case arises, information will be

provided in the notes.

1.1.3 Depreciation of securities

Depreciation is recorded where there are

objective signs of impairment loss for

assets other than those classified as "Fair

value through profit or loss".

It is realised through a lasting or

significant fall in value of the security for

equity securities, or by the appearance of

a significant deterioration in the credit risk

evidenced by a risk of non-collection for

debt securities.

A provision is only constituted to the

extent that the depreciation will result in a

probable loss of all or part of the amount

invested.

1.2 Credit activity

Credits are allocated to the "Loans and

Advances" category. Thus, in accordance

with IAS 39, they are initially valued at

fair value, and later at amortised cost

according to the effective interest rate

method. The effective interest rate is the

rate that exactly discounts the future cash

flows to the original net outstanding loan.

This rate includes losses in value as well

as income and transaction costs included

in the effective interest rate, if appropriate.

Accrued interest on advances is carried

over to the attached advances account in

compensation for profit or loss.

In accordance with IAS 39, advances

allocated to "Loans and Advances"

are depreciated when they present

one or more loss events occurring

after realisation of these advances.

Depreciation is thus constituted for

customer advances with a proven

credit risk matching one of the following

situations:

– when there are one or more

unpaid debts given the special

characteristics of these credits,

– when the situation of a counterparty

has characteristics such that

independently of the existence of

any unpaid loans, a proven risk can

be said to exist,

– if dispute proceedings exist

between the institution and the

counterparty.

Depreciation is equal to the difference

between the carrying amount of the

loans (amortised cost) and the sum of the

estimated future flows, discounted at the

original effective interest rate for revolving

credits. Calculation of depreciation is

based on:

– a statistical approach by

homogeneous portfolio of

41

advances, given the insignificant

nature of the advances taken

individually and their common

characteristics in terms of credit

risk,

– the probabilities of default and

losses based on the risk level

of each of the categories of

outstanding loans (number of

late monthly payments, specific

reasons, etc.).

The amount of depreciation is obtained by

applying statistical modelling of collection

and loss flows by including all possible

movements between the different layers,

based on observed historical data. In

accordance with the provisions of ISA

39, cash inflows used in the statistical

models are discounted. Depreciation

calculated on a debt presenting a proven

credit risk is recognised in cost of risk.

Counting from depreciation of the debt,

the "interest and similar income" entry

in the income statement recognises the

repayment of the net carrying amount of

the debt, calculated at the rate used to

discount the recoverable flows.

1.3 Financial liabilities

IAS 39 adopted by the European Union

recognises two categories of financial

liabilities:

– financial liabilities valued by type

at fair value in compensation for

profit or loss. Their variations in fair

value affect profit or loss at the end

of accounting periods. However

it is noted that the COFIDIS

Participations Group does not hold

liabilities at fair value through profit

or loss.

– other financial liabilities: this

category includes all other financial

liabilities. This portfolio is recognised

at original fair value (including

income and transaction costs) then

recognised later at amortised cost

according to the effective interest

rate method.

1.4 Derivative instruments

Derivative instruments are financial assets

or liabilities and are recognised on the

balance sheet at the original fair value

of the transaction. At the end of each

accounting period, these derivatives

are measured at fair value whether they

are held for trading or they are part of a

hedging relationship.

The counterpart of the revaluation of

derivatives on the balance sheet is

recognised in the income statement

(except in the special case of a cash flow

hedging relationship)

The objective of fair value hedging is to

reduce the risk of changes in the fair value

of a financial asset or liability.

The objective of cash flow hedging is to

reduce the inherent risk in variability of

future cash flows on financial instruments.

As part of a micro-hedging management

intention, the following conditions must

be met in order to benefit from hedge

accounting:

– eligibility of the hedging instrument

and the instrument hedged,

– documentation formalised from

the start, particularly including

the individual designation and

characteristics of the hedged item,

the hedging instrument, the nature

of the hedging relationship and the

nature of the risk being hedged,

– demonstration of the hedging

effectiveness, at the start and

retrospectively.

The revaluation of the derivative is

recognised in the accounts as follows:

– fair value hedge: revaluation of the

derivative is recognised in profit or

loss symmetrically to the revaluation

of the hedged item up to the limit

of the hedged risk and only any

ineffectiveness of hedging appears

as net value through profit or loss,

– cash flow hedge: revaluation of

the derivative is carried over to

the balance sheet as counterpart

to a specific recyclable equity

account and the inefficient part of

the hedging is recognised through


profit or loss, as appropriate.

Accrued interest from the derivative

is recognised through profit or

loss symmetrically to the hedged

transactions.

As regards macro-hedging (portfolio

hedging), the Group documents

transactions as cash flow hedges for

variable rate loans and as fair value

hedges for the depreciable loans portfolio.

Since the 2009 reporting date, the Group

has been using provisions relating to fair

value hedging of a portfolio of interest rate

items.

For portfolios of depreciable assets

(fixed-rate assets), the Group verifies that

there is no over-hedging by applying the

provisions of IAS 39 Carve Out.

After a cash flow or fair value macro-

hedge has been documented, the

revaluation of the derivative is recognised

in the accounts according to the same

principles as those described for micro-

hedging.

The variation in fair value of portfolios

of fair-value hedged instruments is

recognised on a specific line of the

balance sheet, "Revaluation difference for

portfolios hedged by rate", through the

counterpart of the income statement.

1.5 Derecognitionof financial instruments

A financial asset (or Group of financial

assets) is derecognised in whole or part:

– when the contractual rights to the

cash flows associated with it expire

or are transferred, and

– when nearly all the risks and

benefits associated with this

financial asset are transferred.

When the contractual rights to cash flows

are transferred but only a part of the

risks and benefits, as well as control, are

retained, the entity continues to recognise

the financial asset to the extent that it is

involved in this asset.

2 – Deferred taxes

IAS 12 requires recognition of deferred

taxes under the following conditions:

– a deferred tax liability must

be recognised for all taxable

temporary differences, between

the accounting value of an asset or

liability on the balance sheet and its

tax base, except to the extent that

the deferred tax liability is generated

by: initial recognition of goodwill,

or initial recognition of an asset or

a liability in a transaction that is not

a business combination and that

affects neither the accounting profit

nor the taxable profit (tax loss) on

the date of the transaction.

– a deferred tax asset must be

recognised for all deductible

temporary differences, between

the carrying value of an asset or

liability on the balance sheet and

its tax base, to the extent that it

is likely that a taxable profit, on

which these deductible temporary

differences could be charged, will

be available, unless the deferred

tax asset was not generated by the

initial recognition of an asset or a

liability in a transaction that is not

a business combination and that

affects neither the accounting profit

nor the taxable profit (tax loss) on

the date of the transaction.

– a deferred tax asset must also be

recognised for carrying forward

unused tax losses and tax credits,

to the extent that it is likely that

there will be future taxable profit to

which these unused tax losses and

tax credits may be charged.

Deferred tax assets and liabilities are

measured at the tax rates that are

expected to apply when the asset is

realised or the liability is settled, to

the extent that these rates have been

adopted at the reporting date.

Gains on equity securities, as defined

by the French General Tax Code and

falling within the long-term tax system,

are exempt for the fiscal years starting

43

from 1 January 2007. Therefore,

unrealised capital gains recorded on the

reporting date do not generate temporary

differences giving rise to the recognition of

deferred taxes.

Deferred tax is recognised in the net profit

or loss for the period except to the extent

that the tax is generated:

– either by a transaction or an event

that is recognised directly in equity,

in the same period or a different

period, in which case it is directly

debited or credited in equity,

– or by a business combination.

Deferred tax assets and liabilities are

offset if and only if:

– the entity has a legally enforceable

right to offset due tax assets and

liabilities, and

– the deferred tax assets and

liabilities relate to taxes on profits

levied by the same tax authority,

either on the same taxable entity,

or on different taxable entities that

have the intention, either to settle

the due tax assets and liabilities

based on their net amount, or to

realise the assets and settle the

liabilities simultaneously, during

each future accounting period in the

course of which it is expected that

significant amounts of deferred tax

assets or liabilities will be settled or

recovered.

Calculations of deferred taxes are not

discounted.

3 – Assets

In compliance with IAS 16, when a fixed

asset is structured through components

with different useful lives, these are

recognised and depreciated as distinct

items. The depreciable base takes

account of any residual value of fixed

assets.

When it appears from the terms of a

lease contract in which the COFIDIS

Participations Group is lessee that

practically all the risks and benefits

inherent in ownership are transferred

by the lessor to the lessee, the

corresponding assets are recorded at

the time of first recognition as tangible

assets on the COFIDIS Participations

Group's balance sheet, in an amount

equal to the fair value of the leased asset

or the discounted value of the minimum

payments made in respect of the lease, if

this is lower. This sum is then reduced by

depreciation and impairment recorded.

The financial commitments arising from it

are entered in financial debts.

Fixed assets are depreciated by the linear

method over the foreseeable useful life of

the assets. Principal useful lives selected:

– Land, landscaping, utility services:

15-30 years

– Constructions – carcass structure:

20-80 years (depending on the type

of building concerned)

– Constructions – equipment: 10-40

years

– Fixtures and fittings: 5-15 years

– Furniture and office equipment:

5-10 years

– Safety equipment: 3-10 years

– Movable equipment: 3-5 years

– Computer equipment: 3-5 years

– Software acquired or created

internally: 1-10 years

– Acquired client base: 9-10 years

(if acquiring customer contract

portfolio)

In accordance with IAS 36 "Impairmentof assets", when events or changes inthe market environment indicate a riskof impairment of intangible and tangibleassets, they must be reviewed in detailto determine if their carrying amount islower than their recoverable value, thisbeing defined as the higher of the fairvalue (reduced by the disposal cost)and the value in use. The value in use isdetermined by discounting future cashflows expected from the use of the assetand its disposal.

Where the recoverable amount wouldbe less than the carrying amount, animpairment loss is recognised for thedifference between these two amounts.Impairment losses relating to intangibleassets can be reversed subsequently ifthe recoverable value becomes greater


than the carrying amount (up to the limitof the initially recognised depreciation).

Based on the information on fixedasset values available to it, the COFIDISParticipations Group can conclude thatimpairment testing would not result inmodifying the values recorded on thebalance sheet at 31 December 2013.

4 - Goodwill

4.1 Initial recognition

Assets and liabilities acquired as part of

a business combination are recognised

according to the acquisition method:

assets and liabilities are then recorded at

fair value. The residual difference between

the acquisition price and the re-valued

assets and liabilities is recognised under

"Goodwill", if necessary).

4.2 Impairment testsand Cash Generating Units

In accordance with revised standard IFRS

3 "Business combinations", goodwill

is not longer subject to systematic

annual depreciation: the net value of

intangible items is actually subject to

periodic analysis based on discounting

future financial flows corresponding to

the most probably assumptions made

by Management. This impairment test

is based on assumptions in terms of

growth rate, discount rate and tax rate.

The selected assumptions are based

on business plans for future years. This

valuation is carried out on an annual

basis or when a significant event requires

it. Depreciation is recognised when the

valuation reveals undervaluing of the

intangible items assessed.

To perform this impairment test, goodwill

must be allocated to each of the Cash-

Generating Units, forming a unified Group

jointly generating identifiable cash flows

and which are largely independent from

the cash inflows generated by other asset

Groups. The value in use of these units

is determined by reference to discounted

net future cash flows. When the carrying

amount of the CGU is greater than

the value in use, an impairment loss is

recognised for the difference and charged

in the first instance to goodwill.

As part of its transition to IFRS, the

Group considered that the legal entities

constituted CGUs.

5 – Provisions

The COFIDIS Participations Group has

identified all its obligations (legal or

implicit), resulting from a past event,

for which it is likely that settlement

is expected to result in an outflow of

resources, for which the timing or amount

are uncertain but for which the estimate

can be determined reliably.

In respect of these obligations, the

COFIDIS Participations Group has

constituted provisions that in particular

cover:

– company commitments,

– legal risks.

These provisions are estimated according

to their nature, taking account of the most

likely assumptions. The amount of the

obligation, whether it is legal, regulatory

or contractual, is discounted to determine

the amount of the provision, once such

discounting represents a significant

feature.

6 – Employee benefits

6.1 – Employee benefits

Under IAS 19, employee benefits are

grouped into four categories:

– short-term employee benefits,

– post-employment benefits

– long-term benefits

– termination benefits.

From 1 January 2012, they are

recognised in accordance with IAS 19R,

which is applied in advance. The new

provisions result in:

– defined post-employment benefits,

by the immediate recognition

of actuarial gains and losses in

unrealised gains or losses or

deferred and recognised in equity,

and the changes to the plan in

45

income, the application to the plan

assets, of the discount rate for debt

and improved disclosures;

6.1.1 Short-term employee benefits

Short-term employee benefits include:

– salaries, remuneration and social

security contributions,

– short-term paid absences

(particularly annual leave and sick

leave),

– profit sharing and bonuses,

– non-monetary benefits (medical

aid, housing, company cars,

etc.) granted to staff in active

employment.

All of these short-term benefits are

recognised as costs for the period.

6.1.2 Post-employmentbenefits

Post-employment benefits essentially

relate to retirement and are governed

by arrangements classified into two

categories:

– defined contribution plans:

those under which the Group's

commitment is limited only to

paying a contribution, but includes

no commitment for the Group on

the level of benefits provided. The

contributions paid are recognised

as costs in the accounting period.

– defined benefit plans: these are

schemes for which the Group is

committed formally or by implicit

obligation to an amount or a level of

benefits and therefore assumes the

medium or long-term risk.

The principle is that the cost of the post-

employment benefits must be recognised

as costs during the employee's period

of employment and not at the time they

effectively receive these benefits:

– in a defined contributions scheme,

the company is discharged from

any obligation once it has paid its

contributions to the funds. The

cost of post-employment benefits

therefore corresponds quite simply

to the contributions over the period,

– in a defined benefits scheme, the

cost of post-employment benefits

depends partly on the variation

in the amount of the company's

commitments during the accounting

period and partly on the change in

the value of the fund's assets.

A provision is recognised in the balance

sheet liabilities to cover all retirement

commitments. The valuation performed

on a minimum annual basis incorporates

demographic assumptions, early

retirements, increases in salaries and

discount and inflation rates.

When these schemes are financed

by external funds meeting the assets

definition of the scheme, the provision

intended to cover the relevant

commitments is reduced by the amount

of the fair value of these funds.

The differences generated by changes

in these assumptions and by differences

between previous assumptions and what

has actually occurred constitute actuarial

gains and losses. When the plan has

assets, they are measured at fair value

and their expected return is recognised in

profit or loss. The difference between the

actual return and the expected return is

also an actuarial gain or loss.

Actuarial gains and losses are posted to

unrealised or deferred gains or losses

and recognised in equity. Plan reductions

and liquidations result in a change in the

commitment, which is recognised in profit

or loss for the period.

6.1.3 Termination benefits

These benefits are recognised if and

only if the company is "demonstrably

committed" to terminate the employment

of one or more members of staff before

the normal retirement age, or to provide

these benefits following an offer made to

encourage voluntary redundancy.

IAS 19 states that the company

is "demonstrably committed" to a

termination when, and only when it has

a detailed formal plan for the termination

and is without realistic possibility of

withdrawal. It adds that such a plan must,

as a minimum, indicate:


– the location, function and

approximate number of people

affected,

– the benefits provided for each

function or professional grade,

– the date on which the plan will be

implemented.

These benefits are subject to a provision

at the end of the accounting period.

7– Equity instruments: deeplysubordinated notes

7.1 Characteristics of super-subordinated equity

The French Financial Security Law

of 2003 introduced the possibility of

issuing securities qualified as "deeply

subordinated". These securities are

perpetual and are therefore issued for

a unlimited period, no repayment date

being contractually established. In the

event of the issuer going into official

receivership, the eligibility of holders of

such securities ranks lower than that of

all other categories of bonds. Usually, the

issuer has a repayment option starting

from a given maturity date and is bound

to pay interest to bearers of the securities

when it proceeded to pay dividends

during the accounting period.

7.2 Accounting treatment:nominal and interest charges

IAS 32 and IAS 39, relating to the

presentation and recognition of financial

instruments, distinguish between debt

instruments and equity instruments, in

particular based on the substance of the

instruments' contractual characteristics.

According to IAS 32, a financial

instrument for which repayment is not

provided in own shares is an equity

instrument if there is no contractual

obligation to settle in cash or another

financial asset under potentially

unfavourable conditions for the issuer.

When repayment of the capital is at

the sole discretion of the issuer, the

classification of issued securities as debt

instruments or as equity instruments is

determined on the basis of other rights

attached to them. When repayment of the

securities is at the discretion of the issuer,

the securities are equity instruments.

Non-redeemable deeply subordinated

notes, except at the issuer's initiative, and

for which the payment of a coupon is not

obligatory, constitute consolidated equity

and are therefore recognised for the cash

amount received.

The coupons attaching to them are

entered as financial expenses for the

accounting period in the individual

financial statements of the issuer and,

in the consolidated financial statements,

are carried over to reduce equity by the

amount paid net of tax.

8 – Interest income and expenses

Interest income and expenses are

recognised in the income statement for all

financial instruments valued at amortised

cost using the effective interest rate

method.

The effective interest rate is the rate

used to discount future cash inflows or

outflows over the estimated lifetime of the

financial instrument so as to obtain the

carrying amount of the financial asset or

liability. To determine the effective interest

rate, the Group estimates the cash

flows taking contractual procedures into

consideration. This calculation includes

the commissions paid or received

between the parties to the contract or

intermediaries once they are linked to the

yield from the financial instrument, as well

as the transaction costs and losses.

Once a financial asset or a group

of similar financial assets has been

depreciated following an impairment loss,

subsequent interest income is recognised

in the income statement under "Interest

and similar income" based on the original

effective interest rate.

47

9– Net commission income

The Group recognises commission

income and expenses on services

through profit or loss based on the nature

of the services to which they are related.

Commission remunerating continuous

services is spread through profit or loss

over the duration of the service rendered.

Commissions remunerating occasional

services, such as penalties on payment

incidents, are fully recognised through

profit or loss, under "Commission

income", when the service is delivered.

10 – Judgements and estimates used inpreparing the financial statements

In preparing the financial statements as

at 31 December 2013, management is

required to make valuations, which by

their nature, require making assumptions

and include risks and uncertainties

regarding their future realisation.

These can be influenced by many factors,

particularly:

– activities in national and

international markets,

– fluctuations in interest and

exchange rates,

– the economic and political situation

in some business segments or

countries,

– changes in regulations or in

legislation.

This list is not exhaustive.

Accounting estimates that require

assumptions to be made are used

principally for the following valuations:

10.1 Financial instrumentsmeasured at fair value

The fair value is the amount for which an

asset could be exchanged, or a liability

settled, between knowledgeable, willing

parties in an arm's length transaction.

The fair value selected to measure a

financial instrument is firstly the quoted

market price for the financial instrument

when it is listed on an active market.

If a market for a financial instrument is

not active, fair value is then determined

using valuation techniques. A financial

instrument is considered as listed on

an active market if prices are easily and

regularly available from a stock exchange,

broker, trader or regulatory agency, and

these prices represent actual transactions

and take place regularly in arm's length

transactions on the market.

When a financial instrument is handled

on different markets and the Group has

immediate access to these markets, the

fair value of the financial instrument is

represented by the market price. When

there are no listings for a given financial

instrument but the components of this

financial instrument are listed, the fair

value is equal to the sum of the prices

listed for the different components of

the financial instrument including the

purchase and sale price of the net

position.

If a market for a financial instrument is not

active, its fair value is determined using

valuation techniques. Depending on the

financial instrument, these include using

data from recent transactions, fair values

of comparable financial instruments and

valuation models based on discounting

future cash flows.

10.2 Retirement schemes and otherfuture financial benefits

Calculations relating to expenses

associated with pensions and future

financial benefits are based on

assumptions for discount rates, staff

turnover or rates of growth for salary and

social security contributions, made by

management. If the actual figures differ

from the assumptions used, the expense

associated with pensions can increase

or decrease during future accounting

periods.

Management also estimates the

predicted yield rate for assets in these

schemes. Estimated yields are based on

the predicted yield from fixed payment

securities, particularly the yield from

bonds.


10.3 Depreciation of customer advances

The value of the "Loans and advances"

entry is adjusted using a provision relating

to depreciated advances when there is

a proven risk of non-recovery for these

debts.

The value of this provision is estimated

on a discounted basis depending on a

certain number of factors. It is possible

that future credit risk evaluations

may differ significantly from current

evaluations, which could necessitate an

increase or reduction in the amount of the

provision.

10.4 – Provisions

The measurement of other provisions

may also be the subject of estimates,

particularly provisions for legal risks

that result from Management's best

assessment, given the information in its

possession at the year-end.

10.5 Depreciation of goodwill

Goodwill is subject to depreciation

tests at least once a year. Selected

assumptions in terms of business growth

and discount rates for future financial

flows may influence the amount of any

impairment losses to be recognised.

A description of the method applied is

detailed in the section "Consolidation

principles and methods".

IV - Notes to the consolidated balance sheet

1 - Cash on hand, balances at central banks (in thousands of €)

31/12/2013 31/12/2012

Accounts open at central banks 0 0

Cash and cash equivalents 919 2,208

Total 919 2,208

49

2 - Financial assets and liabilitiesrecognised at fair value through profitor loss

At 31 December 2013, financial assets

recognised at fair value through the

income statement stood at €26,840 k. The

Group does not hold financial liabilities at

fair value through the income statement.

Financial assets at fair value through the

income statement exclusively comprise

debt securities with a 100% capital

guarantee at maturity.

3 – Derivative instruments

3.1 - Derivative hedging instruments

At 31 December 2013, financial

instrument interest rate swaps amounted

to €22,380 k in assets and €68,327 k in

liabilities. The portfolio is broken down as

follows:

– swaps paying a fixed rate used to

hedge the risks associated with

financing fixed rate outstanding

debts,

– swaps receiving a fixed rate used

to hedge the risks associated with

loans granted at variable rates,

– interest rate options (particularly CAP

guaranteeing a ceiling rate) used to

guard against a rise in the financing

cost for variable rate loans arising

from a large increase in rates.

– Currency swaps paying a fixed rate

in Hungarian florins used to hedge

the risk associated with refinancing

the Hungarian branch.

Derivative hedging instruments – asset fair value (in thousands of €)

2013

< 1 year> 1 year

and < 5 years> 5 years

Total in marketvalue

31/12/2012

Swaps 2,817 7,699 11,794 22,309 28,601

Options 71 0 0 71 0

Total 2,888 7,699 11,794 22,380 28,601

31/12/2013 31/12/2012

Derivative cash flow hedging instruments 20,038 28,568

Derivative fair value hedging instruments (1) 2,342 33

Total 22,380 28,601


Derivative hedging instruments – liability fair value (in thousands of €)

2013

< 1 year> 1 year

and < 5 years> 5 years

Total in marketvalue

31/12/2012

Swaps 11,960 43,336 9,105 64,402 85,270

Options 175 3,751 0 3,926 5,095

Total 12,135 47,088 9,105 68,327 90,366

31/12/2013 31/12/2012

Derivative cash flow hedging instruments 10,022 26,641

Derivative fair value hedging instruments (1) 58,306 63,724

Total 68,327 90,366

The strategy for using hedging instruments is explained in detail in note IX "Risk exposure and hedging policy".

(1) For fair value hedging, refer to § III.1.4.

3.2 Fair value hierarchy for financialinstruments

There are three levels of fair value for

financial instruments, according to the

definitions in IFRS 7:

– Level 1: prices quoted on active

markets for identical assets or

liabilities;

– Level 2: data other than Level 1

quoted prices for the relevant asset

or liability, observable either directly

(i.e. prices) or indirectly (i.e. price-

derived data);

– Level 3: data not based

on observable market data

(unobservable data).

51

Level 1 Level 2 Level 3 TotalTransfers Transfers

L1 => L2 L2 => L1

Financial assets

Available-for-sale assets 65 65

Assets recognised at fair value through profitor loss

26,840 26,840

Derivative hedging instruments 22,380 22,380

Loans and advances to credit institutions 688,783 688,783

Loans and advances to customers 8,969,352 8,969,352

Total 0 738,068 8,969,352 9,707,420 0 0

Financial liabilities

Derivative hedging instruments 0 68,327 0 68,327 0 0

Total 0 68,327 0 68,327 0 0

3.3 Revaluation surplus for rate hedging portfolios

Fair value2013

Fair value2012

Changein fair value

Fair value of interest rate risk by portfolios

• of financial assets 49,411 57,080 – 7,669

• financial liabilities 0 0 0

4 - Available-for-sale financial assets

31/12/2013 31/12/2012

Accrued interest FCT Cofititrisation 0 0

Certificates of membership of deposit guarantee funds 65 61

Total of available-for-sale securities 65 61


2013Fair Value of non-

depreciated assetsFair Value of depre-

ciated assetsNet

carrying amount

Central administration – – –

Credit institutions 65 0 65

Institutions not credit institutions – – –

Large companies – – –

Retail customers – – –

Total 65 0 65

5 - Loans and advances to credit institutions (in thousands of €)

31/12/2013 31/12/2012

Accounts and loans 688,104 1,416,719

Associated advances 679 471

Total of loans and advances to credit institutions 688,783 1,417,189

The "Loans and advances to credit institutions" entry does not include depreciation.

6 - Loans and advances to customers (in thousands of €)

In thousands of €31/12/2013

Dt Sofemoin 2013

31/12/2012

Advances to customers 10,574,349 1,078,907 9,234,163

Depreciation 1,604,997 82,335 1,506,609

Total of loans and advances to customers 8,969,352 996,571 7,727,554

Breakdown of loans and advances to customers by due date (in thousands of €)

2013

Less than one year More than one year Total

Loans and advances to customers 2,226,220 6,743,131 8,969,352

53

2012


Loans and advances to customers 1,962,412 5,765,141 7,727,554

Breakdown of loans and advances to customers by quality of credit (in thousands of €)

2013

SoundDepreciated

assetsGross value

Impairment Total

Loans and advances to customers 8,069,750 2,504,598 1,604,997 8,969,352

For information, restructured outstanding loans amounted to €476,449 thousand (before discount). They are presented with the

sound loans for an amount net of discount (discounted differential of cash inflows).

2012

SoundDepreciated

assetsGross value

Impairment Total

Loans and advances to customers 6,848,642 2,385,521 1,506,609 7,727,554

For information, restructured outstanding loans amounted to €485,154 thousand.

Depreciation of loans and advances

31/12/2012Charges

Write-backsScope entry Other 31/12/2013

Depreciation of loans and advances to customers 1,506,609 21,658 78,340 (1,611) 1,604,997


7 - Accruals and miscellaneous assets

31/12/2013 31/12/2012

Miscellaneous debtors 41,494 19,494

Others 4,887 4,891

Total miscellaneous assets 46,381 24,385

Income receivable 10,124 6,608

Prepaid expenses 7,162 6,808

Others 31,608 19,684

Total Settlement accounts 48,893 33,099

Total miscellaneous assets and settlement accounts 95,274 57,484

8 – Tangible assets

Variations in the gross values of tangible assets and accrued depreciation are represented in the following table (in thousands of €):

31/12/2012 Increases Decreases Scope entry Other 31/12/2013

Land 3,931 6,592 (232) 0 0 10,291

Computer equipment 30,207 273 (5,554) 0 (17) 24,909

Office equipment 9,957 167 (371) 457 (7) 10,204

Improvements to buildings 17,175 136 (1,389) 0 (28) 15,894

Other tangible assets 5,954 126 (422) 0 (29) 5,630

Gross valueof tangible assets

67,224 7,293 (7,967) 457 (80) 66,927

Land 1,568 294 (199) 0 (0) 1,663

Computer equipment 23,234 1,469 (4,642) 0 (13) 20,048

Office equipment 7,683 493 (296) 231 (12) 8,100

Improvements to buildings 10,740 1,453 (1,322) 0 (39) 10,832

Other tangible assets 3,549 1,220 (959) 0 (0) 3,809

Depreciationof tangible assets

46,773 4,929 (7,419) 231 (63) 44,451

Provisions for tangible assets 2,707 2,707

Net value of tangible assets 20,451 (342) (548) 226 (17) 19,769

55

9 – Intangible assets

Variations in the gross values of tangible assets and accrued depreciation are represented in the following table (in thousands of €):

31/12/2012 Increases Decreases Scope entry Other 31/12/2013

Lease premium 228 20 0 0 0 247

Trademarks acquired as part ofgrouping

11,333 1 (6) 0 0 11,328

Set-up costs 53 0 0 0 – 4 49

Software purchased 48,844 1,249 (8,018) 0 66 42,141

Software produced internally 14,812 878 0 0 0 15,691

Advances and deposits 279 139 (188) 0 (117) 113

Other intangible assets 213 78 0 47 – 19 319

Gross value of intangibleassets

75,762 2,366 (8,213) 47 (73) 69,889

Lease premium 23 1 0 0 0 24

Set-up costs 53 0 0 0 – 4 49

Software purchased 36,712 6,103 (6,890) 0 – 17 35,908

Software produced internally 8,683 3,809 (1,397) 0 0 11,094

Other intangible assets 154 35 – 23 47 – 13 200

Depreciation and provisionsfor intangible assets

45,624 9,948 (8,310) 47 (34) 47,275

Net value of intangible assets 30,137 (7,582) 98 0 (40) 22,614

10 - Goodwill (in thousands of €)

The change in and breakdown of goodwill are presented as follows:

2012 IncreasesImpairment

losses2013

Net value of goodwill 173,448 0 0 173,448

Impairment tests carried out in 2013, in accordance with the procedures described in Note III 4.2, did not result in impairment of

goodwill recognised on the balance sheet.


11 - Debts to credit institutions (in thousands of €)

31/12/2013Dt Sofemo

in 201331/12/2012

Ordinary demand accounts 28,696 9,575 11,018

Ordinary term accounts 7,521,734 943,200 5,453,443

Other debts 10,130 4,165 4,906

Total debts to credit institutions 7,560,560 956,940 5,469,367

12 - Debts to customers (in thousands of €)

31/12/2013 31/12/2012

Ordinary accounts 44,132 42,749

Special savings accounts 497,770 586,301

Term creditor accounts 21,024 20,999

Other sums due 12,078 14,869

Total debts to customers 575,003 664,918

31/12/2013


Debts to customers 574,426 577 575,003

13 - Debts represented by a security (in thousands of €)

31/12/2013 31/12/2012

Negotiable debt instruments 70,000 1,650,000

Bond issues 400,000 400,000

Deposit receipts and savings bonds 0 0

Accrued interest 483 1,044

Total debts represented by a security 470,483 2,051,044

57

Negotiable debt instruments

Negotiable debt instruments are securities

representing a lien for a fixed period and

are negotiable on a regulated or private

market. Group financing for this category

of debt is made up of:

– medium-term negotiable notes, where

the term is greater than one year,

- short-term securities, where the term is

less than one year, such as certificates of

deposit.

Bond issues:

COFIDIS SA has issued all the

various bonds carried by the COFIDIS

Participations Group. The main features

of these bond issues are as follows (in

thousands of €):

Issuing bank Issue date Due dateType

of rateInterest rate Nominal

Calyon-Natixis 11/07/2007 11/07/2014 VariableEuribor 3M+ 0.220 %

400,000

Current and deferred tax assets and liabilities (in thousands of €)

14.1 - Changes in current and deferred tax assets and liabilities

Current tax assets and liabilities

31/12/2012 Net variation 31/12/2013

Current tax assets 17,462 5,000 22,462

Current tax liabilities 16,962 4,580 21,542

Net current tax assets 500 421 920

Current tax assets are principally tax credits. The liabilities correspond to the balance of corporation tax to be paid at the end of the

accounting period as well as miscellaneous taxes.


14.2 Origin of deferred taxes

2013 2012 2013 2012

Assets Liabilities Assets Liabilities Net Net

Temporary differences 104,200 13,938 113,683 20,141 90,262 93,542

Non-deductible provisions 86,308 89 91,731 0 86,218 91,731

Organic, Employee contributions 488 0 702 0 488 702

Assets and depreciation 1 101 1 1,435 (99) (1,434)

Employee benefits 1,688 75 1,591 10 1,613 1,581

Regulated provisions 1,501 0 2,121 (1,501) (2,121)

IAS 39 reclassifications 4,107 6,324 8,736 9,421 (2,217) (685)

Other 11,608 5,848 10,921 7,154 5,760 3,768

Tax deficits carried forward 0 0 0 0 0 0

Offsetting assets/liabilities 0 0 0 0 0 0

Total deferred taxation 104,200 13,938 113,683 20,141 90,262 93,542

Deferred taxes in France are calculated at a rate of 34.43 %. For foreign subsidiaries, tax was calculated at the local rate. Offsetting

of assets and liabilities was performed for each entity.

15 - Accruals and miscellaneous liabilities

31/12/2013 31/12/2012

Miscellaneous creditors 77,611 65,947

Miscellaneous company debts 33,971 35,449

Total miscellaneous assets 111,582 101,397

Expenses to be paid 59,154 46,556

Deferred income 6,512 1,082

Others 20,488 16,396

Total Settlement accounts 86,154 64,034

Total settlement accounts and miscellaneous liabilities 197,736 165,431

59

16 – Provisions

31/12/2012Provi-sions

Write-backs used

Write-backsnot used

Scope entry Other 31/12/2013

Company commitments: pensions 5,068 2,201 (949) (886) 0 (92) 5,342

Company commitments: long-service awards

954 182 0 (15) 0 54 1,174

Legal and tax risk 0 0 0 0 0 0 0

Provision for restructuring 0 0 0 0 0 0 0

Provisions for subsidiary risks 70 0 0 0 0 0 70

Provision for costs andprocedural risk

2,000 4,041 0 (1,824) 5,756 1,513 11,486

Miscellaneous risks and expenses 14,132 6,076 (3,568) (1,202) 0 (1,573) 13,866

Total provisions 22,225 12,500 (4,517) (3,927) 5,756 (98) 31,938

17 – Shareholders' equity

17.1 Composition of share capital

The share capital of COFIDIS

Participations SA comprises 211,960,789

fully paid-up ordinary shares, of the same

rank, at a par value of €0.15 per share,

for a total of €31,794,118.3.

17.2 Management of share capital

For information only, COFIDIS

Participations SA declared a European

solvency ratio greater than 8% in 2012.

17.3 Perpetual deeply subordinatednotes

Consolidated reserves include a perpetual

deeply subordinated note of €100 million

issued in October 2006 by COFIDIS

SA. Interest paid is carried forward as a

deduction from consolidated reserves.

17.4 Change in the cash flow hedge reserve

– at 31 December 2013 (in thousands of €)

In thousands of €

Balance at31/12/2012

Change in fairvalue of derivatives

RecyclingBalance at31/12/2013

Cash flow hedge reserve 348 6,547 – 818 6,077

Note: The data shown in this table are gross of deferred taxes.

The effect of deferred tax on changes during FY 2013 is –€1,588 k.


The cash flow hedge reserve relating to

derivative instruments designated as fair

value hedge at 1 January 2009 stood at

(€4,473 k) at beginning of period and at

(€2,677 k) at the close. Depreciation for

the period, recognised through profit or

loss, was €1,796 k.


In thousands of €

Balance at31/12/2011

Change in fairvalue of derivatives

RecyclingBalance at31/12/2012

Cash flow hedge reserve – 10,476 11,539 – 715 348

Note: The data shown in this table are

gross of deferred taxes.

The effect of deferred tax on changes

during FY 2012 is –€523 k.

The cash flow hedge reserve relating to

derivative instruments designated as fair

value hedge at 1 January 2009 stood at

(€7,554 k) at beginning of period and at

(€4,473 k) at the close. Depreciation for

the period, recognised through profit or

loss, was €3,081 k.

18 – Summary of financial instrument classes by accounting categories


Financial instrument classes

Assetsvalued atfair valuethrough

profit/(loss)(fair value

option)

Available-for-saleassets

Held-to-maturityassets

Loans andreceivables

Derivativehedging

instruments

Liabilitiesat

amortisedcost

Totalnet carrying

amount

Debt instruments 26,840 65 26,904

Loans and advances tocredit institutions

688,783 688,783

Loans to customers 8,969,352 8,969,352

Hedging derivatives 22,380 22,380

Derivatives 0

Other advances 0

Financial assets 26,840 65 0 9,658,135 22,380 0 9,707,420

Negotiable debt instruments 70,000 70,000

61




option)




Derivativehedging

instruments

Liabilitiesat

amortisedcost

Totalnet carrying

amount

Bond issues 400,000 400,000

Securitisation 0

Accrued interest 483 483

Ordinary and demandaccounts

0

Debts to credit institutions 7,560,560 7,560,560

Other debts to creditinstitutions

0

Debts to customers 575,003 575,003

Other debts to customers 0

Subordinated liabilities 0


Derivatives 0

Borrowings and financialdebts

0 0 0 0 68,327 8,606,046 8,674,373






option)




Derivativehedging

instruments

Liabilitiesat

amortisedcost

Totalnet carrying

amount

Debt instruments 25,724 61 25,784

Loans and advances tocredit institutions

1,417,189 1,417,189

Loans to customers 7,727,554 7,727,554


Derivatives 0

Other advances 0

Financial assets 25,724 61 0 9,144,743 28,601 0 9,199,128

Negotiable debt instruments 1,650,000 1,650,000

Bond issues 400,000 400,000

Securitisation 0

Accrued interest 1,044 1,044

Ordinary and demandaccounts

0

Debts to credit institutions 5,469,367 5,469,367

Other debts to creditestablishments

0

Debts to customers 664,918 664,918

Other debts to customers 0

Subordinated liabilities 0


Derivatives 0

Borrowings and financialdebts

0 0 0 0 90,366 8,185,329 8,275,695

63

FINANCE COMMITMENTS

Commitments made to credit institutions 0 2,000

Commitments received from credit institutions 5,100 11,064

Commitments made to customers 3,090,785 3,144,011

GUARANTEE COMMITMENTS

Guarantees, sureties, and other guarantees on the request ofcredit institutions

650 650

Guarantees, sureties and other guarantee bonds received fromcredit institutions

621 3,772

Guarantees on request from customers 40,812 45,013

Guarantees received from customers 33,431 44,078

1- Finance and guaranteecommitments

The lending that the Group has

irrevocably undertaken to grant to its

customers, on their request (in the

context of opening revolving credit

facilities) amounted to €3,091 million at

31 December 2013.In thousands of €

V - Notes to off-consolidated-balance sheet items

2 - Term financial instruments

In accounting terms, all transactions are

considered from their conclusion, even if

the period covered is deferred.

VI – Notes to the consolidatedincome statementNo pro-forma restatements were

performed on the income statement post

the acquisition of SOFEMO. SOFEMO's

data in 2013 is disclosed for each line on

the income statement.


1 - Net banking income (in thousands of €)

2013Dt Sofemo

in 20132012

Income from interest on advances to credit institutions 5,517 180 8,152

Income from interest on advances to customers 1,003,876 43,244 977,303

Income from interest on available-for-sale assets 0 0 0

Income from interest on hedging derivatives 19,773 839 23,530

Interest and similar income 1,029,165 44,263 1,008,984

Interest expenses paid on liabilities to credit institutions 62,078 10,934 63,219

Interest expenses paid to customers 14,612 0 13,652

Interest expenses on debts represented by a security and subordinated debt 2,691 0 24,840

Interest expenses on hedging derivatives 61,875 7,802 58,738

Interest and similar expenses 141,256 18,735 160,449

Commissions (Income) 229,917 18,336 217,691

Commissions (Expenses) 19,889 1,949 20,730

Net gains or losses on Commissions 210,028 16,387 196,960

Net gains or losses from portfolios at fair value through profit or loss 1,053 0 4,316

Net gains or losses on available-for-sale financial assets 886 0 0

Income from other activities 1,923 159 2,591

Costs for other activities 863 494 268

Net gains or losses on Other activities 1,060 – 336 2,323

Net banking income 1,100,937 41,579 1,052,135

2 - General operating costs (in thousands of €)

31/12/2013 Dt Sofemo in 2013 31/12/2012

Payroll (1) 213,469 5,862 210,177

Taxes and levies 11,881 1,014 12,038

Other operating costs 319,452 8,151 295,281

Total general operating costs 544,802 15,027 517,496

(1) Payroll expenses are detailed in Note VIII "Employee benefits"

65

3- Amortisation expense and depreciation of tangible and intangible assets (in thousands of €)

31/12/2013 Dt Sofemo in 2013 31/12/2012

Provision for depreciation of intangible assets 9,948 0 8,580

Provision for depreciation of tangible assets 7,635 25 5,077

Total amortisation expense and depreciation of assets 17,584 25 13,657

Write-back of provisions on intangible assets 1,397 0 6

Amortisation expense/Write-backs and provisions ontangible and intangible assets

16,187 25 13,651

4 - Cost of risk (in thousands of €)

31/12/2013 Dt Sofemo in 2013 31/12/2012

Net provisions for depreciation 15,863 3,619 (64,254)

Recovery of depreciated advances (34,431) (50) (33,545)

Transfer to losses 382,460 8,854 461,168

Change in operating risk provisions 2,217 3,731

Cost of customer risk 366,108 16,154 363,368

5 - Net gains or losses on other assets (in thousands of €)

31/12/2013 Dt Sofemo in 2013 31/12/2012

Income from asset disposals (50) 0 (63)

Capital loss on asset disposals 1,781 0 555

Gains or losses on other assets (1,732) 0 (492)


6 - Taxes (in thousands of €)

6.1 Tax expense

31/12/2013 Dt Sofemo in 2013 31/12/2012

Current tax expense 51,764 3,922 53,150

Deferred tax expense 5,200 (317) 427

Tax expense for the period 56,964 3,605 53,577

6.2 Tax analysis

Reconciliation between the theoretical tax expense and the tax expense entered in the income statement for the Group is detailed

as follows (in millions of euro):

31/12/2013 31/12/2012

Consolidated profit or loss before taxes 172 157.1

Current tax rate in France 38.00 % 36.10%

Theoretical tax at current French tax rate 65.4 56.7

Effect of permanent differences – 4.1 – 3.9

Differences in foreign tax rates – 9.7 – 6.4

Effect of unrecognised tax assets (1) 1.8 2.6

Rate change 2.2 0.9

Tax on dividends 3.0 3.0

Others – 1.7 0.7

Group tax charge 57.0 53.6

Effective tax rate 33.10 % 34.10 %

(1) Unrecognised tax assets notably concern the non-activation of deficits, and for Cofidis Italy, the non-recognition of deferred tax

assets on customer depreciation.

67

7 - Auditors' fees

In thousands of € before VAT

2013

TotalFees

KPMG MAZARS PWC Other

Certification 1,074 825 96 136 16

Ancillary missions

TOTAL 1,074 825 96 136 16

In thousands of € before VAT

2012

TotalFees

KPMG MAZARS PWC Other

Certification 1,009 793 86 131 0

Ancillary missions

TOTAL 1,009 793 86 131 0

VII – Segment information

1 - Definition of activity segments

The entities in the COFIDIS Participations

Group conduct business in a single

segment of activity, namely consumer

credit to private individuals. Accordingly,

in application of IFRS 8 relating to

operating segments, we are required to

disclose information on the geographical

breakdown of the areas in which we

operate, which is the only segment

information provided by the Group.

There are three regions in the

geographical breakdown, namely France,

Southern Europe and Belgium & Eastern

Europe.

2- Segment information bygeographical area:data from income statement (inthousands of €)

Transactions between business centres

are concluded under market conditions

and segment assets are determined

based on the accounting items making

up the balance sheet for each business

centre.


31/12/2013

France Southern EuropeBelgium

& Eastern EuropeTotal

Income statement items

Interest income 654,235 275,147 99,784 1,029,166

Interest expenses 126,812 11,219 3,225 141,256

Net banking income 666,903 310,191 123,843 1,100,937

OPERATING PROFIT 49,743 95,788 28,309 173,840

Tax on profits 23,191 30,226 3,548 56,964

31/12/2012



Income statement items

Interest income 634,734 266,980 107,269 1,008,984

Interest expenses 137,230 14,607 8,612 160,449

Net banking income 626,421 295,361 130,352 1,052,135

OPERATING PROFIT 43,061 80,594 33,964 157,620

Tax on profits 20,631 26,360 6,586 53,577

Segment information by geographical area: data from balance sheet

31/12/2013



Balance sheet items

Loans and advances to customers 6,619,588 1,520,439 829,325 8,969,352

Loans and advances to banking institutions: 639,198 27,714 21,872 688,783

Total 7,258,785 1,548,153 851,197 9,658,135

69

31/12/2012



Balance sheet items

Loans and advances to customers 5,452,053 1,464,052 811,449 7,727,554

Loans and advances to banking institutions: 1,356,112 26,613 34,464 1,417,189

Total 6,808,165 1,490,665 845,913 9,144,743

VIII – Employee benefits

1 - Payroll

31/12/2013 Dt Sofemo in 2013 31/12/2012

Salaries 137,773 3,410 133,953

Social security contributions 54,670 1,484 56,974

Profit sharing 8,443 387 8,811

Others 12,582 580 10,439

Total payroll (1) 213,469 5,862 210,177

(1) Including €1,943 k in Competitiveness and Employment Tax Credit (CICE), effective on 1 January 2013 (Art 66 LFR 2012) and

recognised as a credit to the staff costs account.

2 - Workforce for the period

The average workforce and the workforce on the reporting date are as follows:

Workforce at end of period at 31 December 2013

31/12/2013 31/12/2012

Managers Supervisors Employees Total Total

Women 579 218 2,034 2,831 2,802

Men 575 97 871 1,543 1,334

Total workforce at end of period 1,154 315 2,905 4,374 4,136


3 - Post-employment benefits - definedbenefit schemes

All French and Belgian entities are

concerned by the defined benefits

scheme. For the main schemes, an

actuarial valuation is performed every

year. These defined-benefit schemes

relate to end-of-career benefits.

4 - Other long-term benefits

Employee benefits that do not fall due

and are not paid in full within twelve

months after the end of the accounting

period. These benefits concern long-

service awards.

5 – Actuarial assumptions

The main actuarial assumptions have

been determined for each country.

The rates used to estimate the obligations

are as follows:

31/12/2013 31/12/2012

Discount rate 3.00% 2.90%

Expected rate of salary increase 2.68% 2.55%

6 - Reconciliation of balance sheet provisions

The following balance sheet variations in pension provisions and similar commitments were recognised (in thousands of €):

Commitment

31/12/2012 7,998Current service cost 790

Financial cost 236

Actuarial gains and losses – 80

Payment to beneficiaries – 268

Other (business combinations, liquidation) – 86

31/12/2013 8,589

Average workforce at 31 December 2013

31/12/2013 31/12/2012

Managers Supervisors Employees Total Total

Women 574 228 1,930 2,732 2,839

Men 541 104 788 1,432 1,393

Total average workforce 1,115 332 2,718 4,164 4,232

71

Scheme assets

31/12/2012 2,929Actuarial gains and losses 13

Return on scheme assets 91

Contributions to the scheme 475


Other (business combinations, liquidation) 0

31/12/2013 3,248

Provision

31/12/2012 5,068Current service cost 790

Financial cost 144

Contributions to the scheme – 475

Actuarial gains and losses – 92


Other (business combinations, liquidation) – 86

31/12/2013 5,342

7 - Financial hedging of the scheme

Financial hedging of the scheme can be analysed as follows:

31/12/2013 31/12/2012

Debt securities 2,715 2,271

Equity instruments 114 162

Property 388 342

Others 30 154

8 - Sensitivity analysis

Financial hedging of the scheme can be analysed as follows:

Discount rate: + 0.5% 7,767

Discount rate: - 0.5% 9,529


IX - Risk exposure and hedgingpolicy

The risks incurred by the COFIDIS

Participations Group are those of a credit

institution offering revolving, redeemable

and credit card type consumer credit, in

its own name or through its network of

partners.

Credit operations are conducted directly

through customer relations centres or

Internet sites, as well as through partners.

Bank and private cards are provided

to customers. The internal control

mechanisms in place have been gradually

adapted to deliver satisfactory solutions

to the challenges of controlling new risks

incurred.

1 - Credit risk

1.1 - General remarks on credit risks

A credit risk occurs when a counterparty

is unable to meet its obligations and

these obligations have a positive inventory

value in the company's ledgers. For the

COFIDIS Participations Group, the bulk

of credit risk relates to loans granted to

individuals, and this risk is spread over a

large number of customers with limited

individual commitment.

1.2 Credit riskmanagement procedures

In particular, the methods used to control

credit risk are based on resources

dedicated to:

– risk studies and applying scores

and acceptance rules,

– operational teams responsible for

the outstanding payment chain,

– risk management audit to ensure

it is monitored and applied, and to

support it with adequate provision.

The system for controlling this risk uses a

number of tools to implement preventive,

corrective and strategic actions.

The forecasting system is based on:

– a system of scores and acceptance

rules that enable us to anticipate

customer behaviour and

safeguard the future profitability of

transactions,

– the three-year budget plan,

prepared at the end of the

third quarter, establishing

strategic objectives. Two budget

extrapolations are performed

annually.

The monthly credit risk monitoring

dashboard is used to to monitor changes

in customer risk according to multiple

criteria: product, history of outstanding

payments, account opening generation or

recruitment channel. Information collected

in this dashboard is used to monitor and

analyse the cost of risk, and to implement

a customer risk provisioning policy. In

addition, the COFIDIS Participations

information system has the capability

to provide information on outstanding

loans under management and to compile

inventories by risk level categories.

COFIDIS Participations has also set up

a curative management system to back

its credit risk preventive management

system and has thus developed collection

sequences that the organisation varies

according to maturity and market

practices. These sequences can include

the following phases and features:

pre-collection, amicable collection, pre-

litigation, over-indebtedness and legal

recovery. After these internal collection

procedures, disputed outstanding

debts can be outsourced to an external

management contractor, or sold.

A monthly "Credit Dashboard" report

provides information on the cost of risk as

well as its proportion of total outstanding

debt from month to month. It is produced

by the Management Audit department

and is circulated to members of the

executive committee, managing directors

and managers and heads of the relevant

departments.

The provisioning system is generally

based on the definition and statistical use

of average rates of movement from one

category of unpaid outstanding debt to

73

another from one month to another. The

calculation for each category is based

on statistical observation of the change

in unpaid outstanding debt and actual or

probable losses, for each of the products.

Scoring systems, acceptance and

collection rules, as well as provisioning

systems must be open-ended and are

reviewed as required from time to time.

In this way, the organisation ensures that

all outstanding debt categories, process

developments, behavioural or regulatory

changes are taken into account by the

system. Similarly, the provisioning method

is reviewed by adjusting the provisioning

rates by category of outstanding debt

to environmental needs (markets,

customers, regulators).

The maximum credit risk exposure

accepted by the Group at 31 December

2013 is detailed as follows (in thousands

of €):

Analysis of outstanding assets:

A financial asset is considered as

outstanding when a counterparty has not

made a payment at the contractual due

date. The provisioning policy applied by

the Group is to make individual provision

on the statistical basis of outstanding

loans from the first default event.

2 – Counterparty riskfor financial transactions

COFIDIS Participations SA is exposed

to a counterparty risk in the context of

cash flow management and implementing

loan and hedging transactions (rates in

the main). Banking counterparties are

assessed by the CM CIC Group on a

regular basis. Based on this assessment,

counterparties are classified according

to a number of criteria and related

procedures, which could lead to the

closure of the account.

Note that flows of French companies are

centralised in accounts opened with the

CM CIC Group. Surplus liquidity of foreign

entities is centralised preferentially, or

allocated to CM CIC Group accounts in

France, or to related company accounts

outside France.

31/12/2013 31/12/2012

Financial assets designated at Fair Value through profit or loss 26,840 25,724

Held-to-maturity assets – –

Derivative hedging instruments - assets 22,380 28,601

Available-for-sale financial assets 65 61

Loans and advances to credit institutions 688,783 1,417,189

Loans and advances to customers 8,969,352 7,727,554

Other advances 221,937 188,629

Firm loan commitments 3,090,785 3,144,011

Total 13,020,141 12,531,768


Moreover, loan and rate hedging

transactions are preferentially handled

with CM-CIC Group.

Potential new bank counterparties must

be approved by the CM CIC Group.

3- Overall interest rate risk, liquidityrisk and foreign exchange risk

3.1 Overall interest rate risk

3.1.1 Intervention strategy

The Treasury Management department

of Cofidis Participations Group manages

the refinancing and rate risk for the whole

scope of Cofidis Participations.

Rate risk relates to:

– fixed-rate customer credit for which

the Central Treasury provides a

strict hedge for outstanding loans

by following changes in new credits,

– on revisable rate credits for which

the short-term aim of the hedging

policy is to limit the exposure of

COFIDIS Participations Group

entities to any rate rises or

reductions and their repercussions

on customer rates within a longer or

shorter time frame.

3.1.2 – Instruments and practices

Private instruments used, traded on

markets, are firm or optional: rate swaps,

caps, floors and collars.

The bulk of our refinancing is variable

rate, based mainly on Euribor and on

Eonia.

3.2 - Liquidity riskAs a credit institution, COFIDIS

Participations is structurally a borrower.

BFCM, which is the sole company

involved in capital markets for the

CM-CIC Group, handles the operating

financing requirements for companies

in the COFIDIS Participations Group,

ensuring the Group has the liquidity

required for its business.

Besides daily management of liquidity

needs, Group Central Treasury approves

future needs based on forecast

outstanding loans for renewable and

redeemable products and the refinancing

needs expressed by entities in the Group.

The details of the repayment schedule

for debts at 31 December 2013 are as

follows (in millions of euro): Data in the

table entered by the conso

31/12/2013Less

than oneyear

1 to 2 years 2 to 5 yearsMore than

5 years31/12/2012

Bond issues 400 400 – – – 400

Securitisation 0 – – – – 0

TCN 70 50 20 – – 1,651

Short- medium term lines 7,531 4,250 758 2,294 229 5,458

Ordinary demand accounts 29 29 – – – 11

Total debts 8,030 4,728 778 2,294 229 7,519

75

3.3 - Foreign exchange risk

Group policy includes management of

foreign exchange risk.

Entities borrow in currencies from local

bank counterparties or from COFIDIS

SA. COFIDIS SA finances intra-group

borrowing in currencies or in euro

converted into currencies, with no foreign

exchange risk.

Purchases in foreign currencies are limited

to current operating costs.

Currency positions are monitored and

swiftly unwound.

4 – Control of transactions

At each month-end, a monitoring

dashboard is prepared covering liquidity,

rate, forex and counterparty risk for each

entity.

It is used to formally check the

compliance of transactions handled

during the past month relative to

objectives.

During its monthly meeting, based

on events in the previous month and

the needs expressed by entities in the

COFIDIS Participations Group, the

Treasury Committee defines hedging

requirements (margin for manoeuvre in

terms of volume and duration, according

to market conditions and developments),

as well as new market intervention

strategies. This committee comprises

the team in charge of monitoring risks,

its Director, the Group's Chief Financial

Officer and monabanq's Chief Financial

Officer.

ontactsContac

COFIDIS FranceCOFIDIS FParc de la Haute Borne61 avenue Halley59667 VILLENEUVE-D’ASCQ CedexTel: +33 3 28 09 20 00www.cofidis.fr

monabanq.Parc de la Haute Borne61 avenue Halley59667 VILLENEUVE-D’ASCQ CedexTel: +33 3 20 28 34 34www.monabanq.com

CréatisParc de la Haute Borne61 avenue Halley59667 VILLENEUVE-D’ASCQ CedexTel: +33 3 28 09 20 00www.creatis.fr

COFIDIS PortugalAvenida de Berna - 521069 046 LISBOATel: +35 1 21 761 18 00www.cofidis.pt

COFIDIS SpainPl. de la pau s/nEdificio1 - WTC Almeda Park08 940 Cornella de LlobregatTel: +34 9 3 253 56 00www.cofidis.es

COFIDIS BelgiumRue du Glategnies, n° 4BP 7500 TOURNAITel: +32 69 25 12 70www.cofidis.be

COFIDIS ItalyVia A Bono Cairoli, 3420 127 MILANOTel: +39 02 366 16 1www.cofidis.it

COFIDIS Czech RepublicBucharova 1423/6158 00 PRAGUE 5CZECH REPUBLICTel: +42 0 234 120 120www.cofidis.cz

COFIDIS HungaryBudapest, 1066Mozśar u.16HUNGARY - MagyarorsźagTel: +36 1 354 50 01www.cofidis.hu

COFIDIS CompétitionZAC de Ravennes les Francs6 avenue Poincaré59910 BONDUESTel: +33 3 20 66 23 00www.equipe-cofidis.com

Documents

ANNUAL 2013 - Accueil · signature of a new partnership deal in Spain with Agrupacio, an insurance company in the Crédit Mutuel Group; the successful launch of the CIC Iberbanco