SFIL Annual financial report 2018

Consolidated financial statements in accordance with IFRS I 3 89 Annual Financial Report 2018 SFIL Management report Report on corporate governance Consolidated financial statements in accordance with IFRS Annual financial statements in accordance with French GAAP Shareholders’ Meeting of May 29, 2019 General information 5. Notes to the income statement (EUR millions) 5.1 - INTEREST INCOME - INTEREST EXPENSE Group SFIL presents interest calculated using the e ective interest rate method on financial instruments measured at amor- tized cost or at market value through equity under the headings “Interest income” and “Interest expense”. These headings also include interest income and expense on financial instruments recognized at fair value through proft or loss because they do not meet the SPPI criterion due to the fact that the cash flows received do not consist solely of principal and interest payments. However, the change in value calculated excluding accrued interest on these fnancial instru- ments at fair value through proft or loss is recorded under Net result of financial instruments at fair value through proft or loss (see section 5.3). Interest income and expense on hedging items. Meanwhile, certain derivatives not classifed as hedging instruments for accounting purposes are held as economic derivatives are included with the revenue generated by the associated hedged hedges of financial instruments carried at fair value through profit or loss; the interest income and expense on these eco- nomic hedge derivatives are included in the headings recording the interest on these financial instruments. 2017 2018 (1) INTEREST INCOME 2,657 2,724 Central banks - - Financial assets at fair value through net income - 175 Financial assets at fair value through equity - 4 Loans ans advances due from banks at amortized cost 2 18 Loans and advances to customers at amortized cost 1,335 857 Bonds at amortized cost - 151 Financial assets available for sale 35 - Financial assets held to maturity - - Derivatives used for hedging 1,280 1,518 Impaired assets - - Other 5 1 INTEREST EXPENSE (2,483) (2,594) Central banks (16) (11) Financial Liabilities at fair value through net income - (172) Due to banks at amortized cost (15) (11) Due to cutomers at amortized cost - (1) Debt securities at amortized cost (1,308) (1,211) Subordinated debt - - Derivatives used for hedging (1,140) (1,188) Other (4) - INTEREST MARGIN 174 130 (1) Of which interest income and expense, measured using the effective interest rate method for assets and liabilities measured at amortized cost, of EUR 1,026 million and EUR -1,223 million, respectively. 5.2 - FEES AND COMMISSIONS 2017 2018 Incomes Expenses Net Incomes Expenses Net Lending activity 4 - 4 3 0 3 Purchase and sale of securities - (1) (1) - (0) (0) Services on securities other than custodian services - (3) (3) - (3) (3) Commissions on financial instruments 3 - 3 1 - 1 TOTAL 7 (4) 3 4 (3) 1