CFM INDOSUEZ Wealth Management - 2020 Annual Report

R E PORT OF THE BOARD OF D I R ECTOR S AT THE ORD I NARY GENE R AL ME E T I NG OF 1 1 MAY 2 0 2 1 32 TheCFM IndosuezWealthManagement 2020 financial statements have been prepared using the same scope as in 2019 and 2018, applying the IFRS standards in force to the consolidated financial statements of CFM Indosuez Group, and integrating the wholly owned management and investment advisory subsidiaries in the scope of consolidation, including separate financial statements for the credit institution CFM Indosuez Wealth Management. (in millions of euros) 2020 2019 Change in % Net banking income 117.6 127.4 -7.7% Operating expenses - 90.9 -95.0 -4.3% Gross operating income 26.7 32.4 -17.6% Cost of risk -1.5 -1.3 - Extraordinary items - 31.9 N/A Income tax -3.4 -13.8 N/A CFM Indosuez Wealth Group net income 21.8 49.2 N/A Non-controlling interests - -0.1 CFM Indosuez Wealth Group’s net income 21.8 49.1 CONSOLIDATED RESULTS FOR 2020 VERSUS 2019 UNDER IFRS STANDARDS The consolidatednet banking incomeof CFM Indosuez WealthManagement Group in 2020was €117.6million, i.e. -7.7% compared to 2019. Restated for 2019 net banking income items relating to adjustments to our real estate portfolio, the Group's consolidated net banking income was down -4% in 2020 compared with the previous year: the negative impact of the decline in interest rates onmargins was only partially offset by robust brokerage activities. CFM IndosuezWealthManagement Group’s operating expenses totalled€90.9million in 2020, down by -€4.1 million in relation to 2019, reflecting tight control over expenses in the exceptional context of the health crisis. Gross operating income was €26.7 million in 2020, compared with €32.4 million in 2019. Restated for extraordinary items in N-1, gross operating income remained stable. Net income stood at €21.8 million in 2020, factoring in the cost of risk (-€1.5million), comparedwith €21.8 million in 2019 after balancing out extraordinary items due to real estate portfolio adjustments. This stability of net income is a result of the efforts to keep operating expenses under control in an uncertain context due to the Covid-19 pandemic.