UPDATE TO THE 2012 REGISTRATION DOCUMENTCOMPANY PROFILE Profile Crédit Foncier is the only multi-expert in real estate financing in France With 15 regional offices across five major

creditfoncier.com

UPDATE TO THE 2012 REGISTRATION DOCUMENT

INCLUDING THE 2013 HALF-YEAR FINANCIAL REPORT

This update to the registration document is available on the website www.creditfoncier.com

The original update to the registration document was filed with the Autorité des marchés financiers (French Financial Markets Authority) on August 29, 2013, in accordance with Article 212-13 of its general regulations under the number D.13-0397-A01. It completes the registration document filed with the AMF on April 19, 2013 in accordance with Article 212-13 of the AMF’s general regulations, under the number D.13-0397. It may be used in support of a financial transaction if accompanied by a prospectus duly approved by the AMF. This document was produced by the issuer and its signatories are responsible for its content.

This document is a free translation into English of Crédit Foncier’s update to the 2012 registration document issued in the French language and is provided solely for the convenience of English speaking readers. Every effort has been made to ensure that the English translation is an accurate representation of the original; however, in case of discrepancy the French version will prevail and is the only binding version.

1 - CRÉDIT FONCIER IN THE FIRST HALF OF 2013

5167_EdEp_CF_Semestriel2012_GB_Entrée.indd 1 11/10/13 15:39

2 - RISK MANAGEMENT


3 - FINANCIAL INFORMATION


4 - OTHER INFORMATION


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2013 HALF-YEAR FINANCIAL REPORT - CRÉDIT FONCIER

COMPANY PROFILE 4KEY FIGURES 5

1. CRÉDIT FONCIER IN THE FIRST HALF OF 2013 7

2. RISK MANAGEMENT 23

3. FINANCIAL INFORMATION 69

4. OTHER INFORMATION 113

UPDATE TO THE 2012 REGISTRATION DOCUMENTINCLUDING THE 2013 HALF-YEAR FINANCIAL REPORT

Abbreviations used in the document:Thousands of euros: ekMillions of euros: emBillions of euros: ebn

PRESENTATION

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COMPANY PROFILEProfile

Crédit Foncier is the only multi-expert in real estate financing in France

With 15 regional offices across five major regions, 260 points of sale and a telesales platform, Crédit Foncier has enabled more than 3 million consumers to become home-owners over the past twenty years.

With the rollout of its brand in financing and real estate services, it covers the entire value chain and supports more than 7,000 real estate professionals in the service, residential or social sector.

Crédit Foncier has refocused on its core business lines and on activities in France and regularly updates its products and services to better serve its customers. It demonstrates its strength in innovation by launching new products and services and through its growing specialisation in a market that is seeing increasingly complex demands and greater segmentation. Its proven capacity to raise funds in demanding financial markets also attests to the trust that investors have in it.

A wholly-owned subsidiary of BPCE, the second-largest banking group in France, Crédit Foncier is Groupe BPCE’s principal real estate financing arm.

Key factsFounded in: 1852Business sector: Banking, Real EstateFacts and figures: 3,000 employees

260 points of sale

Business lines

Direct loans to individuals

Crédit Foncier proposes a full range of products and services for customers wishing to purchase, invest in or renovate a property, including home-ownership loans (long-term loans, loans for low-income families, bridge loans, regulated loans), rental investment loans (payable at maturity), reverse mortgages, etc.

Financing for the public sector, real estate developers and investors

Crédit Foncier supports French local authorities in their investment policies (transit systems and urban renewal) and finances major public and private operators and the social housing sector. In addition, Crédit Foncier and its subsidiary SOCFIM provide real estate developers with short-term advances, credit facilities, off-balance sheet commitments in the form of collateral and completion guarantees.

Real estate services

Real estate services are provided by Crédit Foncier Immobilier (CFI), a wholly-owned subsidiary of Crédit Foncier. CFI offers a full range of services, including consulting, brokerage, expertise, management and auditing for investors and public sector entities as well as individuals.

PRESENTATION

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KEY FIGURESCrédit Foncier Group’s Activity

(in €m)

H1 2013 H1 2012 (1)

Loan production (management data) 5,025 4,150

Individuals 3,484 2,955

Corporates 1,131 775

o/w:

• Public sector 879 536

• Private sector 252 239

Subsidiaries(2) 410 420

New issues 2,965 7,291

o/w Issues of obligations foncières 2,965 6,340

(1) On a like-for-like basis.(2) The “Subsidiaries” line has been included in order to isolate certain activities for which a market-type approach is not appropriate (loans to staff, consumer

loans issued by Banco Primus and SOCFIM’s real estate development activities).

(in €m)

At 06/30/2013 At 12/31/2012

Gross securities and receivables (1) 111,234 115,007

Individuals 58,951 59,193

Corporates 52,284 55,814

o/w:

• Public sector 43,832 47,215

• Private sector 8,451 8,599

(1) Year-end management data as per IFRS 7.

PRESENTATION

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Consolidated financial statements

(in €m)

At 06/30/2013 At 12/31/2012

Consolidated balance sheet

Balance sheet total 148,411 163,303

Consolidated equity - Group share 3,656 3,586

Regulatory capital 4,459 4,470

o/w basic regulatory capital 4,217 4,223

o/w regulatory core capital (1) 3,937 3,943

Basel II solvency ratio - Standardised approach (2) 10.2% 10.4%

Tier-1 ratio (basic capital) 9.6% 9.8%

Core Tier-1 ratio (core capital) 9.0% 9.2%

(1) After deducting perpetual deeply subordinated notes.(2) Calculated on the basis of capital requirements presented in section 3.3 of the Risk Management Report.

(in €m)

H1 2013 H1 2012

Consolidated results

Net banking income 330 330

Gross operating income 65 57

Income before tax 1 5

Group share of net income 10 3

PRESENTATION

THE GROUP 8Highlights 8Functional organisational structure 9Administrative and executive bodies 10Positioning 11Ratings 12Share capital 12Capital transactions 13

COMMERCIAL AND FINANCIAL ACTIVITY 14Economic environment 14Sales activity 15

1 - CRÉDIT FONCIER IN THE FIRST HALF OF 2013

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1 CRÉDIT FONCIER IN FIRST-HALF 2013

– 8 –


THE GROUPHighlights

CRÉDIT FONCIER, A KEY PLAYER IN THE REAL ESTATE MARKET

March

Presentation of Crédit Foncier’s annual real estate market study to real estate professionals at the Palais des Congrès in Paris: “Real Estate Market Review for 2012 and Outlook for 2013”.Launch of the Crédit Travaux (home improvement) loan.Crédit Foncier participated in the annual meeting of the Union des Maisons Françaises (UMF) on “How to create the conditions for a revival in the new housing market in 2014?”

April Crédit Foncier took part in trade fairs including the Century 21 National Convention and the National Real Estate Fair.

GROUP STRATEGY

January Crédit Foncier launched the PTZ+ enhanced interest-free loan. The PTZ+, which was reformed in the amended finance law for 2012, was launched on January 4, 2013.

February Official launch of Foncier Patrimoine, bringing together services for high net worth individuals and non-residents.

March The Caisse d’Epargne Île-de-France issued its first Prêt Locatif Intermédiaire (PLI) loan (regulated loan issued by a Caisse d’Epargne) with Crédit Foncier’s support.

April Buyout of the minority stake in Banco Primus.

JuneBuyout of the minority stake in Crédit Foncier Immobilier (CFI).Rollout of Crédit Foncier’s “new generation” branch concept, which has a customer-focused approach and is designed and organised with the home-buying process in mind.

COMMITMENT TO SOCIETY AND THE ENVIRONMENT

April Conference on solidarity-based housing.France’s Sustainable Development week - Conference on reducing energy consumption in housing.

INNOVATION

May Crédit Foncier participated in the BPCE Innovation Awards.

FUNDING

January Standard & Poor’s confirmed Compagnie de Financement Foncier’s AAA rating.

March Compagnie de Financement Foncier, a wholly-owned subsidiary of Crédit Foncier, won the MTNI Landmark Deal award in London. MTNI is the leading trade magazine on Euro Medium Term Notes (EMTN).


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Functional Organisational StructureExecutive Management and the Executive Committee at June 30, 2013

Éric FILLIATChief of Financial

ManagementFinance Division

Mathieu LEPELTIERChief Risk Officer

Risk and Compliance Division

Sandrine GUÉRINChief of Corporate and

Investment Banking (CIB)Financial Operations

Division

Philippe DUPINCorporate transactions

François GUINCHARDIndividual transactions

Luc RONDOTInformation systems

Corinne DECAUXLegal Department

Patrick CHASTANTGeneral Inspection

Bruno DELETRÉChief Executive Officer

Jean-Pierre POUGETDeputy Chief of Financial

ManagementFinance Division

Accounting and taxation

Muriel COLLEHR and Facilities Planning Division

Thierry DUFOURDeputy CEO,

Chief Financial OfficerFinance and Operations

Nordine DRIFMarketing & supervision

Isabelle SELLOS-MAHECorporates

(public and private)

Stéphane IMOWICZReal Estate Services

Anne-Margeritte GASCARD

Sales networks

Alain DAVIDMajor accounts

Philippe PETIOT(from 09/01/2013)

Deputy CEORetail and Corporate

Resources and Steering division. Finance and Operations division. Retail and Corporate Banking division. Member of the Executive Management Committee.

François PÉROLChairman


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Administrative and Executive bodiesExecutive Management

Composition of the Executive Management team(At June 30, 2013)

Bruno DELETRÉ, Chief Executive OfficerThierry DUFOUR, Deputy Chief Executive Officer, Chief Financial Officer in charge of Finance and Operations.

The Executive Management Committee also comprises:• Éric FILLIAT, Chief of Financial Management, Finance Division;• Sandrine GUÉRIN, Chief of Corporate and Investment

Banking, Financial Operations;• Mathieu LEPELTIER, Chief Risk and Compliance Officer.

Changes to the composition of the Executive Management team in the first half of 2013• At its meeting of June 14, 2013, the Board of Directors was

informed of the resignation of Christophe PINAULT, Deputy Chief Executive Officer, from July 1, 2013.

• The same Board meeting appointed Philippe PETIOT as Deputy Chief Executive Officer in charge of Retail and Corporate Banking from September 1, 2013.

Board of Directors

Composition of the Board of Directors(At June 30, 2013)

Board of Directors• François PÉROL - Chairman of the Board of Directors• Gérard BARBOT - Chairman of the Remuneration Committee• Meka BRUNEL - Member of the Remuneration Committee• Nathalie CHARLES - Member of the Remuneration Committee• Jean CLOCHET - Member of the Remuneration Committee• Pierre DESVERGNES• Bruno DUCHESNE• Nicole ETCHEGOÏNBERRY - Member of the Audit Committee• Christine FABRESSE• Jean-Yves FOREL• Jean-Paul FOUCAULT• Dominique GARNIER - Member of the Audit Committee• Catherine HALBERSTADT• Francis HENRY - Member of the Remuneration Committee

• Jean-Hervé LORENZI - Member of the Audit Committee• Anne MERCIER-GALLAY• Stéphanie PAIX• BPCE, represented by Daniel KARYOTIS - Chairman of the

Audit Committee

Non-voting Directors• Jean-Marc CARCELÈS• Marc JARDIN• Michel SORBIER

Central Works Council Delegates• Christine PACHOT (management representative)• Valérie FIX (client executives, banking representative)

Government Auditor• Antoine MÉRIEUX

Changes to the composition of the Board of Directors in the first half of 2013The Annual General Shareholders’ Meeting of May 3, 2013:• ratified the co-opting of Anne MERCIER-GALLAY as Director

to replace François RIAHI;• ratified the co-opting of Jean-Yves FOREL as Director to

replace Olivier KLEIN;• appointed Bruno DUCHESNE as Director to replace Jean-

Michel LATY;• appointed Christine FABRESSE as Director to replace Jean-

Claude CREQUIT.


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PositioningOrganisation chart of Groupe BPCE at August 6, 2013

100%

50%

72.24% (3)

27.76%

50%

100% (1)

Commercial Banking and Insurance.

Wholesale Banking, Investment Solutions and Specialised Financial Services.

(1) Indirectly through Local Savings Companies.(2) With the equity interest held by the Caisses d’Epargne in BPCE Assurances, the Group owns a 60% stake in the company.(3) Percentage of voting rights held by BPCE.(4) Via CE Holding Promotion.

BPCECENTRAL INSTITUTION

GROUPE BPCE

19 BANQUES POPULAIRE BANKS

17 CAISSES D’EPARGNE

FREE FLOAT

EQUITY INTERESTS

• Coface (100%)

• Crédit Foncier de France (100%)

• Banque Palatine (100%)• BPCE International

et Outre-mer (100%)• BPCE Assurances (46.37%) (2)

COMMERCIAL BANKING AND INSURANCE

SUBSIDIARIES

NATIXIS

8.7 MILLION COOPERATIVE SHAREHOLDERS

• Nexity (41.06%) (4)


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RatingsStandard & Poor’s (S&P) Moody’s Fitch Ratings

ST LT Date ST LT Date ST LT Date

Crédit Foncier A-2A-

stable outlook01/23/12 P-1

A2stable outlook

06/15/12 F1A

stable outlook07/17/13

Affiliated with BPCE

A-1A

negative outlook11/19/12 P-1

A2stable outlook

11/23/12 F1A


Cie FF * A-1+AAA


Aaastable outlook

10/22/99AAA

rating watch negative07/18/13

VMG * AAA Aaa AAA

* Cie FF: Compagnie de Financement Foncier - VMG: Vauban Mobilisations Garanties.

Changes in Crédit Foncier Group’s ratings since June 30, 2013Following the downgrading of France’s sovereign rating by one notch from AAA to AA+ on July 12, 2013, Fitch Ratings decided that this downgrading impacted the entire French banking sector. The ratings of Groupe BPCE and its subsidiary Crédit Foncier were therefore also revised. On July 17, 2013 Groupe BPCE and Crédit Foncier’s long-term ratings were lowered by one notch from A+ to A, and their short-term ratings were downgraded from F1+ to F1.

Share CapitalCharacteristicsAt June 30, 2013, Crédit Foncier’s share capital amounted to €1,331,400,718.80, divided into 369,833,533 shares fully paid-up in cash, each with a nominal value of €3.60. Crédit Foncier does not own any of its own shares. The total number of voting rights is equal to the number of shares. The by-laws do not contain any provisions that are more restrictive than legal provisions regarding changes to the shareholding structure and the rights of different share classes that could be created.Crédit Foncier has not issued securities that can be converted into capital such as convertible bonds that can be exchanged or redeemed for equity instruments, warrants, etc. or options for management and staff to purchase or subscribe for shares.

Breakdown in the share capitalSince August 5, 2010, BPCE has held 100% of Crédit Foncier’s share capital and voting rights, with the exception of the directors’ shareholdings held by members of the Board of Directors.


– 13 –


Capital TransactionsRestructuring

Immo HabitatOn February 25, 2013, Crédit Foncier completed the liquidation of Immo Habitat 1.

Groupe TelpresseOn February 2, 2013, Crédit Foncier completed the liquidation of Groupe Telpresse.

Sergic InvestAs Foncier Participations had opted to redeem its Sergic Invest convertible bonds in cash at maturity, it received €527,423.75 (including the non-conversion premium) on March 27, 2013. As the other shareholders had opted to convert their bonds into shares, a capital increase was held following the Annual General Shareholders’ Meeting of March 27, 2013. This capital increase diluted Crédit Foncier’s percentage holding (from 8.82% to 8.25%).

Developing and improving the Group’s existing structures

Banco PrimusUnder a settlement agreement dated April 17, 2013, Crédit Foncier purchased the 4,500,000 shares held by the minority shareholder. Crédit Foncier’s percentage holding in Banco Primus rose from 95.45% to 100%.

Foncier DiagnosticsIn February 2013, Crédit Foncier advanced €180,000 to its subsidiary to covers its terminal value cash requirements.On June 6, 2013, Crédit Foncier purchased the Foncier Diagnostics shares held by SOCOTEC, amounting to 1% of the share capital. Following this buyout, Crédit Foncier holds 100% of Foncier Diagnostics’ capital.

Crédit Foncier Immobilier (CFI)On June 28, 2013, Crédit Foncier bought out the 25.07% stake in CFI held by HAO, for €10,500,000. Following this transaction, Crédit Foncier holds 100% of CFI.Alongside the buyout of HAO’s minority stake in CFI, Crédit Foncier sold its shares in HAO (0.01% of its share capital).

LocindusCrédit Foncier exercised its option to receive its Locindus dividends in shares. As a result, on June 27, 2013, Crédit Foncier received 602,433 Locindus shares with a value of €7,379,804.25, which increased its holding from 74.15% to 74.49%.

CofimabOn March 18, 2013, Crédit Foncier advanced €6,620,000 to finance the buyout of a warehouse belonging to SCI CAL EAST.

SipariOn April 23, 2013, Sipari repaid €13,867 in advances made to it by Crédit Foncier in connection with the ROUEN RIVE GAUCHE transactions.On June 21, 2013, Sipari paid up €1,500,000 for OPCI Majestal 1, for which Sipari had subscribed in the amount of €3,000,000. After this payment, Sipari’s subscription was fully paid up.

Sipari-VélizyOn March 22, 2013, Crédit Foncier advanced €59,400 in respect of the SAS DUCHESSE D’HARCOURT transaction.

SOCFIMAs part of the consolidation of Crédit Foncier’s real estate development financing activity within its subsidiary SOCFIM, on January 1, 2013, it transferred its real estate dealing and development customer base to SOCFIM, for €600,000.

Transactions within Groupe BPCE

Fideppp 2On June 12, 2013, Crédit Foncier paid up a second instalment of capital for €186,500, increasing the portion of paid-up capital to 6.23%.


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COMMERCIAL AND FINANCIAL ACTIVITYEconomic environmentEurozone GDP contracted by 0.2% in the first quarter of 2013 (the sixth consecutive quarter of decline) and the Eurosystem expects GDP to fall by -0.6% in 2013. Unemployment remains high, at 12.2% of the available workforce.The International Monetary Fund expects global growth to slow from +3.2% in 2012 to +3.1% in 2013. Global growth is mainly being driven by emerging countries (+5.5% on average) and other economies that are seeing a very slow recovery, like the United States and Canada (+2% on average). Growth has also slowed in China, where GDP rose by +7.5% in the second quarter of 2013, compared with +7.7% in the second quarter of 2012.While doubts remain over the budget policies of several southern European countries (Cyprus, Portugal, Spain and Italy, respectively the eurozone’s 4th and 3rd largest economies), fiscal uncertainties and austerity measures are also dampening consumer and business spending and investment.

Contrasting funding terms for governments

Government borrowing terms are extremely contrasted. While France and Germany are enjoying record low interest rates, ratings downgrades and sovereign debt restructuring have raised the cost of borrowing for Greece, Portugal and Spain.However, the spreads between Portuguese and Irish 10-year bonds and their German counterpart narrowed at the end of the first half of 2013.

Changes underway in the banking sector

Major regulatory changes have been made in the banking sector, with, for example, the publication of the European Market Infrastructure Regulation, the Capital Requirements Directive IV and the Capital Requirements Regulation. Consultations are also being held by the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA). These reforms aim to improve transparency on financial institutions and transactions and to enhance banks’ liquidity and solvency. The sector should become more stable and less exposed to systemic risk in the medium term.

Five-year rates

as a %

0

1

2

3

4

5

6

2013 2009 2010 2011 2012

ECB10-year swap3-month Euribor

The European Central Bank (ECB) kept interest rates low as part of its monetary policy. In May 2013, it cut the main bank refinancing rate from 0.75% to 0.5%, its lowest ever level. The marginal lending rate, at which banks can borrow from the ECB for a 24-hour period, was also lowered to 0.5%.

Despite the recent improvement in economic indicators and expectations that the US Federal Reserve will soon end its unconventional monetary policy (quantitative easing), in July the ECB President, Mario Draghi, confirmed that the bank would maintain its current policy stance, which will remain “accommodative for as long as necessary”.


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Sales Activity

Individual customersThe French real estate marketsThere was no improvement in the economic environment in France in the first half of 2013. Growth remained depressed, unemployment continued to rise and fiscal pressure increased further. The slight decrease in prices and number of transactions in the residential real estate market that began in 2012 could be confirmed in 2013. However, this is a gradual adjustment process and structural housing needs in France should prevent the market from collapsing.

Residential real estate market

Sales of new homes in the real estate development sector fell slightly at the beginning of 2013 compared with the start of 2012 (-3%) (1). Initial demand for the Duflot real estate investment scheme was slow, and sales to private investors continued to fall (-23%) (2). However, the new home-ownership segment expanded slightly (+4%) (2).

Sales of existing homes continued the decline seen in 2012.

The real estate lending market

After contracting sharply in 2012 (-26%), the real estate lending market seems to have stabilised in 2013. In the first quarter of 2013, the loan production was almost stable against the last quarter of 2012 (-1%). However, compared with the same period of the previous year, the loan production fell by 8%. Loans for new homes declined the most (-26% against the same period of 2012) (3). Since the start of 2013, the real estate lending market has benefited from exceptional lending terms, which have partly offset the drop in consumer purchasing power (4).

Crédit Foncier’s activity in the first half of 2013

Products and services and sales organisation

Crédit Foncier launched a new advertising campaign in early 2013, putting the emphasis on how it meets households’ financing requirements.The campaign promotes Crédit Foncier’s expertise in offering its customers innovative financing solutions.

At the same time Crédit Foncier revamped its website to reflect its new brand positioning. The new website is more user-friendly, it contains enhanced editorial content and is adapted to all formats of mobile devices (smartphones, tablets, etc.). Its visibility and brand awareness have improved, and its audience increased by 30% in the first half of 2013.

Placing its network at the heart of its sales strategy, Crédit Foncier has embarked on a programme to renovate its agencies with a modern, innovative concept: the design and layout of the “new generation” agencies follow the different stages in the home-buying process. The new agencies also showcase Crédit Foncier’s professional partners. Four agencies were renovated in the first half of 2013 and 30 others will be refitted in the second half of the year.

For its approved agents, Crédit Foncier has a wide range of tools that enable it to support all its partners in view of the French reform of the status of intermediaries in banking transactions and payment services (IOBSP reform), in particular via ENFI, its real estate financing school.

In the context of economic crisis, Crédit Foncier promoted its insurance products such as mortgage payment protection insurance and insurance guaranteeing the property’s resale value, with the aim of reassuring its customers and providing full support throughout the home-buying process.

(1) CGDD - Commissariat général au développement durable (Commissioner General for Sustainable Development).(2) FPI - Fédération des promoteurs immobiliers (French federation of real estate developers).(3) OPCI - Observatoire de la production de crédits immobiliers (Mortgage origination observatory).(4) Observatoire Crédit Logement CSA (Crédit Logement - CSA home loan observatory).


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Individual customers: loan production

Loan production to individual customers rose by nearly 20% in the first half of 2013, despite the slight fall in the overall market.Crédit Foncier remains the undisputed leader in home-ownership loans for families on low incomes: at June 30, 2013 it held a 50% market share in state-subsidised home-ownership loans to people on low incomes (PAS) in France.

Structure of loan production issued in the first half of 2013

By distribution channel

(in €m)

Distribution channel H1 2013 H1 2012% of total,

H1 2013

Approved agents 2,118 1,763 61%

Branches * 343 286 10%

Sales outlets 67 69 2%

Major partners 95 94 3%

Total - branch network 2,623 2,212 75%

Private clients 50 55 1%

Non-residents 39 35 1%

Correspondents 530 470 15%

Total - regional departments 3,242 2,772 93%

Foncier Direct online banking channel

34 36 1%

Crédit Foncier Travaux 60 51 2%

Total - individuals France 3,336 2,859 96%

Belgium 149 59 4%

Total individuals 3,484 2,919 100%

* Loans to walk-in customers.

By market

New property ownership37%

Existing property ownership40%

Rental investment new construction10%

Rental investment existing3%

Miscellaneous10%

€3.5bn

Outlook for 2013In view of the economic environment, the real estate market is likely to continue to contract in the second half of the year.

In existing homes, Crédit Foncier expects its activity volumes to fall by approximately 11% compared with 2012, with around 630,000 transactions (5).

Price trends are overall negative, though there are considerable disparities between properties depending on their condition and location. Prices are likely to continue to adjust gradually until the end of 2013.

In new homes, the Duflot investment scheme had a slow start. Real estate developers are therefore adapting to a weak market. Deliveries have contracted sharply and sales are likely to be significantly lower in 2013.

Crédit Foncier expects to sell 71,800 homes through its real estate development activity and 125,000 single-family houses (5).

Summary

ACTIVITY WITH INDIVIDUALS

(in €m)

H1 2013 H1 2012

Production 3,484 2,919

(in €m)

06/30/2013 12/31/2012

Outstanding loans at end of period

58,951 59,193

Direct loans to individuals

49,683 49,017

Securities backed by residential mortgage loans (RMBS) in Europe (stock)

9,268 10,176

(5) Crédit Foncier Immobilier.


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Corporate clientsThe economic environment inevitably impacted the various real estate markets in the first half of 2013:• the real estate development market saw a sharp fall

in new housing sales and a decline in transactions on existing homes;

• commercial property investment volumes held up despite a sharp drop in total volumes sold or let;

• public-private partnerships have evolved and the majority of projects are now for less than €100m;• the social housing market continued to receive

significant government support and preferential funding sources;

• after two years of pressure, local authorities excluding hospitals seem to be benefiting from easier financing terms from a wider range of lenders.

In the uncertain and complex social and economic environment, Crédit Foncier adapted to the financing requirements of real estate investors and public sector bodies, providing long-term support in their development plans.

PUBLIC SECTOR

Social housing

Crédit Foncier’s strategy and product range

The key focus of Crédit Foncier’s social housing strategy remains the distribution of intermediate regulated loans and unregulated loans to underpin public policy in social housing.

The market in the first half of 2013

Housing is one of the French government’s main priorities and since the beginning of the year it has earmarked resources to encourage home building and meet the target of building 150,000 social housing units per year by 2015 and renovating a further 120,000 homes. The measures include the Duflot law of January 18, 2013 and a series of decrees and orders allowing the government to sell off land free of charge and to increase social housing quotas from 20% to 25% of homes in towns with a population of over 3,500. The housing and town planning act, known as the ALUR law, should introduce a reduced rate of VAT of 5% for the construction and renovation of social housing.


Groupe BPCE remains the market leader in social housing financing, notably through its subsidiary Crédit Foncier. Since the end of 2012, Crédit Foncier has provided regulated loans via two distribution channels: directly, carrying outstanding amounts in its balance sheet, and under a servicing agreement with the Caisses d’Epargne.

Improved liquidity and continued attractive financing terms mean Crédit Foncier’s teams can provide optimum services to social housing lessors for the renewal of fittings, the renovation of existing properties and the purchase of assets, for example.


By type of customer

Social housing lessors65%

Associations9%

CIL*4%

Local authorities22%

€0.3bn

* Inter-professional housing committees.

Outlook for 2013

The funding terms for regulated loans will be announced at the beginning of the second half, which will delay the achievement of government targets.


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French local authorities

The market in the first half of 2013

The first half of 2013 saw a return to normal on the French local authorities market. The trends observed in the second half of 2012 were confirmed and even intensified, with an increase in competition on the financing market and supply covering or even exceeding demand, estimated at around €20bn for 2013.

Bank loans to local public sector entities, including those from the Caisse des Dépôts et Consignations (CDC) and the European Investment Bank (EIB), should amount to around €20bn. In addition to these bank loans, public sector bodies use bond issues and securitisation mutual funds to finance their activities.


In the face of increasingly tough competition, Crédit Foncier drew on its capacity to lend over long periods, in excess of 20 years.At the end of June 2013, loan origination amounted to €620m. This origination was underpinned by its successful bidding in calls for tender.Crédit Foncier continued to support its customers in their debt management by proposing arbitrage solutions adapted to market trends. Crédit Foncier has been involved in securing local authorities’ structured debt for several years.


By type of customer

Towns19%

EPCI*36%

French Departments8%

Hospitals37%

€0.6bn

* EPCI: Établissements publics de coopération intercommunale (French inter-municipal cooperation bodies).

Outlook for 2013

The partnership between Caisse des Dépôts et Consignations and the European Investment Bank announced in the first half of the year will be implemented in the second half and may accelerate the fall in average margins.

In such conditions, Crédit Foncier, together with the Caisses d’Epargne, will continue to support the financing of public investment projects and adapt its offer with financial structures tailored to the type of projects, while retaining its capacity to lend over periods of up to 30 years.

PRIVATE SECTOR

The market in the first half of 2013On the commercial property investment market, the first half of 2013 saw a continuation of the trend seen since 2011, with concentration among players, in the number of transactions and the location and type of office buildings. Continuing the trend observed in 2012, town-centre businesses accounted for 17% of investments in the first six months of 2013. Certain investors showed renewed interest in warehouses. Logistics accounted for 16% of investment volumes during the period.

At June 30, 2013, investments in standard commercial real estate amounted to €5.7bn. The hotel segment saw several major transactions, including the sale of a portfolio of four luxury hotels to a Qatari investment fund.

The Ile-de-France region continues to account for the lion’s share of activity, with 79.5% of non-localised portfolio commitments in the first half of the year.

Quality office space is becoming hard to find and investors are extending their targets to premises located in the immediate suburbs and central business districts. Investments in high added-value assets are gradually beginning to materialise, though the trend remains slow.

However, there is a growing dichotomy between the stabilisation or growth in the investment market and the volume of premises sold or let, which has fallen sharply since the start of the year due to the lack of economic growth and the end of downsizing programmes by private and public sector users.


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Investments in industrial and logistics premises rose very sharply at the start of the year. Commitments were 2.5 times higher than in the same period of 2012, amounting to €0.9bn. Investors sought class B assets available at a discount or needing renovation. Investments in retail space also fell against the first half of 2012, with the focus being on town-centre assets.

In project and infrastructure financing, the first half of 2013 was more auspicious than the same period a year earlier. However, budget restrictions are impacting the level of public investments. Calls for tender mostly applied to projects of under €150m, which significantly reduced the size of the market (by around 50%). The market on which Crédit Foncier is positioned was stable at around €1.2bn.

Crédit Foncier’s activity in the first half of 2013For Crédit Foncier, the first half of 2013 was different to 2012 on both the investment market and the project and infrastructure financing market.

With investors, Crédit Foncier was able to meet strong demand as market volatility eased. Investments in core assets - strategic low-risk assets - were monopolised by players with a strong capital base, and this significantly altered the financing market. Crédit Foncier adapted its offering to support customers in their acquisition plans and major restructuring projects aimed at repositioning their investment properties. It offered its customers alternative solutions in terms of long-term financing, mortgage loans or lease financing through its subsidiary Locindus. The creation of a syndication division means that Crédit Foncier can now participate in financing syndicates of banking and non-banking partners for transactions involving larger amounts.

For project and infrastructure financing, Crédit Foncier - along with other Groupe BPCE entities - has recorded a remarkably high conversion rate since the start of the year. Crédit Foncier’s expertise, combining the role of an investment bank with that of a lender, means it can structure financing solutions tailored to each project’s specific features. Crédit Foncier also responded to changes in the type of projects, which are focusing more on equipment than on the buildings (electricity grids, high-speed data networks and heating systems).

For example, Crédit Foncier, in partnership with Caisse d’Epargne Île-de-France, will finance the renovation and extension of the electricity grid for the Community of the Greater Cergy-Pontoise area (CACP). The work will be carried out under an 18-year design, construction, repair and maintenance contract signed by the CACP, Cinergy (a subsidiary of Vinci Energie) and Spie Île-de-France Nord.

Outlook for 2013On the commercial real estate investment market, although real estate remains an attractive safe-haven investment, the slump in demand will inevitably impact market volumes. The French commercial real estate market remains one of the world’s largest and most mature markets, with widely recognised fundamentals. As in previous years, the most active players will be capital investors: major transactions (in excess of €200m) are expected in the second half of the year.

Crédit Foncier is involved in financing asset classes beyond standard commercial real estate, in particular in the healthcare and social services sector, hotels and major residential portfolios. This positioning should offset any decline in investments in commercial real estate assets. Its combined offering of loans and lease financing solutions enables it to meet market requirements, in particular in major restructuring programmes.


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Summary

ACTIVITY WITH CORPORATES

(in €m)

H1 2013 H1 2012 (1)

Production 1,131 775

Public sector 879 536

o/w:

French local public sector

620 138

Social housing 259 397

Private sector 252 239

(1) On a like-for-like basis.

(in €m)

06/30/2013 12/31/2012

Outstanding loans at end of period 52,283 59,520

Public sector 43,832 50,921

o/w:

French local public sector 16,682 17,279

Social housing 8,165 7,902

International public and sovereign (1) financing

13,789 19,166

Securities backed by loans to individuals with guarantees from a Step 1 state (≥ AA- rating)

5,195 6,574

Private sector (France and international)

8,541 8,599

(1) o/w French sovereigns: €5,193m at 12/31/2012 and €1,264m at 06/30/2013.

Research, expertise and real estate services

Crédit Foncier Immobilier is the fourth largest real estate consultancy in France. It stands apart for its strong local presence and its leadership in real estate expertise. Crédit Foncier Immobilier offers a full range of services, from consulting to the sale of residential and service buildings, through expertise and management, complementing the activities of Crédit Foncier and Groupe BPCE.

It is organised into two divisions: the first focused on advisory, expertise and research and the second dedicated to sales and marketing. In the first half of 2013, the sales division was reorganised around the Ad Valorem brand.

Consulting and Expertise

Crédit Foncier Expertise

Crédit Foncier Expertise’s activity faced a market slowdown, notably due to the decline in activity by users and the reduction in the number of public sector calls for tender. In this challenging environment, missions in the French regions and expertise provided to external clients held up, with a high level of orders. First-half revenues amounted to €6.3m, in addition to €2.2m in orders not yet invoiced.

Serexim

Serexim has recorded very strong growth since the start of the year. This was due to the renegotiation of loans with retail banking networks and a slower decline in intermediate real estate financing, which is Serexim’s core target market. The specialist in appraisals was also buoyed by the expansion of its service offering, notably including the launch of a rental fittings inventory service - a highly innovative product that was warmly welcomed by the market. First-half revenues amounted to €3.8m.


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Consulting & Audit

Crédit Foncier Immobilier’s Consulting & Audit division recorded strong business volumes, with revenues of €0.65m and orders of €0.46m to be invoiced over the year. This performance was particularly remarkable given that decision lead-times have tended to become longer for both private and public sector order originators. Besides its strategic asset advisory services, the Consulting & Audit division is extending its range of project management assistance services and is managing four construction and major renovation projects on behalf of Groupe BPCE entities.

Research

Crédit Foncier Immobilier’s Research department generated revenues of €0.62m, in line with its targets.

Sales and marketing

Ad Valorem Investissement

The department dedicated to sales of multiple buildings had a good start to 2013, with first-half revenues of €0.69m and €1.16m to be invoiced on forthcoming sales. It benefited from the bullish investment market and confirmed its position as a key player in both the service sector (sale of Ponant II, sales mandate for the building located at 43 Boulevard des Capucines in Paris) and residential real estate - the sector in which it was traditionally best known.

Ad Valorem Bureaux

The entity formerly known as B&D Conseils generated revenues of €0.22m in the first half of the year from its office space leasing and sales activity in the Paris central business district. Like its counterparts, Ad Valorem Bureaux was nonetheless affected by the slowdown in volumes let or sold.

Ad Valorem Résidentiel

Since the start of the year, Ad Valorem Résidentiel has grouped activities involving the batch sale of buildings and the sale of real estate programmes on behalf of developers. It has an original business model providing a single point of contact for new and existing properties available for purchase or investment. In an uncertain market, this model was given a very warm welcome, in particular from approved agents, who appreciate the original and varied approach to rental investments.

Agent activities have been strong since the beginning of the year, with an increase in revenues compared with 2012. This strong start was boosted by the launch of the Duflot investment scheme. Traditionally, most transactions are completed in the last quarter of the year.

Direct sales of existing homes were impacted by the fall in volume on this market. Prices have begun to fall, in accordance with sellers, and this should boost transactions in the second half of the year. Ad Valorem Résidentiel’s revenues amounted to €2.3m in the first half, with €1.8m in fees to be invoiced on forthcoming sales.

Ad Valorem Gestion

The property management business continued to grow, notably with the implementation of two new major mandates signed at the end of 2012 covering building management and leasing activities. First-half revenues amounted to €0.44m.

Banco Primus’ activityBanco Primus sells used car loans to individual customers in Portugal and also oversees the portfolio run-off that began at the end of 2011 (mortgage loans in Portugal and Spain, car loans in Hungary).

At June 30, 2013, outstanding loans amounted to €630.7m, broken down as follows:• active portfolio: €274.7m;• run-off portfolio: €356.0m.

The company’s core tier-1 ratio was 11.6% at June 30, 2013.

It is wholly-owned by Crédit Foncier following the buyout of the minority shareholder (5.06% of the share capital) in April 2013.


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Financial operations

Market conditions

After an extremely volatile year in 2012, the bond markets were quieter in early 2013. The considerable liquidity pumped into the system by the ECB’s VLTRO (Very Long-Term Refinancing Operation) in early 2012 and Mario Draghi’s speech in July 2012 confirming that the bank would do “whatever it takes” to save the European currency paved the way for less volatile markets in the first half of 2013.

These two key events in 2012 boosted Spanish and Italian sovereign debt, whose yields eased sharply.

Access to liquidity is no longer such a major concern. However, historically low interest rates, the start of a recovery in the United States and a difficult economic environment in Europe are affecting the markets.

Review of transactions

In this market environment, the Crédit Foncier Group issued nearly €3bn in long-term debt with an average maturity of 12 years on June 30, 2013 (in around forty issues) via its subsidiary Compagnie de Financement Foncier, after completing €1.5bn in prefunding in late 2012. Like for other financial sector issuers, activity in the first half of the year was driven by private placements - bespoke products tailored to investors’ interests and objectives in the current low interest rate environment. Private placements accounted for nearly 60% of issues, once again proving the strength and flexibility of this activity.

In January 2013, Compagnie de Financement Foncier added €750m to its benchmark 2022 issue, offering investors a new long-term investment opportunity.

German and French investors respectively accounted for 36% and 39% of the investor base during the first half of 2013. Scandinavian investors also renewed their investments with a NOK1bn 20-year issue made in May 2013.

Breakdown of obligations foncières issued by Compagnie de Financement Foncier in the first half of 2013

By type of investor

Pension funds2%

Central banks11%

Asset managers13%

Insurance companies60%

Banks14%

€3bn

By geographic area

Others9%

United Kingdom2%

Scandinavia8%

Italy4%

Asia2%France

39%

Germany36%

€3bn

Active asset and liability management

Crédit Foncier continued the disposal of international assets that began in September 2011. In the first six months of 2013, disposals amounted to €2.3bn, mainly involving securitisation tranches. The disposals were facilitated by overall favourable liquidity terms in the first half of 2013 and a narrowing of spreads.

Since September 2011 the total amount of international assets sold amounted to €7.2bn.

Redemptions of Compagnie de Financement Foncier’s liabilities amounted to €0.6bn in the first half of 2013, in line with the amount recorded in 2012, taking the total amount of liabilities redeemed since September 2011 to €2.9bn.

2 RISK MANAGEMENT

Introduction - General risks of the Crédit Foncier Group 26 1 - General organisation & methodology 26 2 - Scope of application 28 3 - Internal capital adequacy and regulatory capital requirements 29 4 - Credit and counterparty risk exposures 33 5 - Risk mitigation techniques 47 6 - Securitisations 49 7 - FSF reporting (G7) 54 8 - Market risks 59 9 - Asset & liability management risks 6210 - Operational risk 6411 - Intermediation risk 6812 - Settlement risk 6813 - Non-compliance risk 6814 - Crédit Foncier’s Caisse de Retraite (French pension fund)

for employees who entered employment before March 1, 2000 68

2 - RISK MANAGEMENT

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RISK MANAGEMENT Detailed contents

INTRODUCTION 26

GENERAL RISKS OF THE CRÉDIT FONCIER GROUP 26

1 - GENERAL ORGANISATION & METHODOLOGY 26

1.1 - Assignments entrusted to the Risk, Compliance and Permanent Control functions 261.2 - Organisation of the Risk, Compliance and Permanent Control functions 261.3 - Operations under the Basel II environment 271.4 - Information systems and quality of Crédit Foncier Group data 271.5 - Summary of risk management procedures and methods 27

2 - SCOPE OF APPLICATION 28

2.1 - Accounting consolidation scope and prudential consolidation scope (Basel method) 282.2 - Scope of application within Crédit Foncier 28

3 - INTERNAL CAPITAL ADEQUACY AND REGULATORY CAPITAL REQUIREMENTS 29

3.1 - Capital management 293.2 - Composition of prudential capital 293.3 - Capital requirements 313.4 - Solvency ratios 33

4 - CREDIT AND COUNTERPARTY RISK EXPOSURES 33

4.1 - Overall analysis of commitments 334.2 - Commitments by customer portfolio 40

5 - RISK MITIGATION TECHNIQUES 47

5.1 - Collateral valuation and management 475.2 - Main insurers 475.3 - Effect of credit risk mitigation techniques 485.4 - Balance sheet and off-balance sheet netting 48

6 - SECURITISATIONS 49

6.1 - Objectives, activities and risk monitoring 496.2 - Approaches and external credit ratings 496.3 - The Crédit Foncier Group’s exposures to securitisation transactions 50

7 - FSF Reporting (G7) 54

7.1 - CDOs and exposures to monoline insurers and other credit enhancers 547.2 - Exposures to Commercial Mortgage-Backed Securities (CMBS) 567.3 - Other subprime and Alt-A exposures (RMBS, loans, etc.) 587.4 - Special Purpose Entities (SPEs) 587.5 - Leveraged buyouts (LBOs) 587.6 - Securitisation glossary 59

8 - MARKET RISKS 59

8.1 - Market risk monitoring 598.2 - Equity risk 60

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9 - ASSET & LIABILITY MANAGEMENT RISKS 62

9.1 - Organisation of ALM risk monitoring 629.2 - Methodology for assessing liquidity, interest rate and foreign exchange risks 629.3 - Liquidity risk monitoring 629.4 - Interest rate risk monitoring 639.5 - Foreign exchange risk monitoring 64

10 - OPERATIONAL RISKS 64

10.1 - General framework 6510.2 - Governance 6510.3 - Management environment 6510.4 - Organisation of business continuity plans (BCP) 6510.5 - IT risks 6510.6 - Legal risks 6610.7 - Insurance 66

11 - INTERMEDIATION RISK 68

11.1 - Trading on behalf of third parties 6811.2 - Proprietary trading * 68

12 - SETTLEMENT RISK 68

13 - NON-COMPLIANCE RISK 68

14 - CRÉDIT FONCIER’S CAISSE DE RETRAITE (FRENCH PENSION FUND) FOR EMPLOYEES WHO ENTERED EMPLOYMENTBEFORE MARCH 1, 2000 68

* As per the definition of an investment department given by the Autorité des Marchés Financiers (AMF, French Financial Markets Authority).

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Introduction

General risks of the Crédit Foncier GroupCrédit Foncier is potentially exposed to three types of risk:• credit and counterparty risks: see section 4;• structural risks (liquidity risk, interest rate risk and foreign

exchange risk): see section 9;• and operational risks: see section 10.

The Crédit Foncier Group does not conduct any financial market business for its own account and does not therefore directly assume any financial market risk on its ordinary transactions other than for asset and liability management (ALM) purposes: see section 8: Market risks.

The other risks inherent in the Crédit Foncier Group’s businesses are as follows:• intermediation risk: see section 11;• settlement and settlement-delivery risks: see section 12;• non-compliance risk: see section 13.

1 - General organisation & methodology1.1 - Assignments entrusted to the Risk, Compliance and Permanent Control functions

1.1.1 - Assignments of the Risk function

For further information, please refer to page 100 of the 2012 Registration Document.

1.1.2 - Assignments of the Compliance function


1.1.3 - Assignments of the Permanent control function


1.1.4 - Assignments of the Business Continuity Plan function


1.1.5 - Assignments of the Information Systems Security function


1.2 - Organisation of the Risk, Compliance and Permanent Control functionsCrédit Foncier’s Risk and Compliance Division is part of Groupe BPCE’s Risk Management structure.

1.2.1 - Groupe BPCE Risk Management Division


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1.2.2 - Crédit Foncier’s Risk Management Division


1.2.3 - Crédit Foncier’s Compliance Division


1.2.4 - Crédit Foncier’s Permanent Control Coordination Department


1.2.5 - Business Continuity Plan


1.2.6 - Information Systems Security


1.3 - Operations under the Basel II environmentIn accordance with the targets set with Groupe BPCE, Crédit Foncier is continuing to work towards obtaining Basel II advanced internal rating certification for all its portfolios (with the exception of Specialised Financing), namely Retail, Corporate, Public sector/Social housing and Banks/Sovereigns.

Significant progress was made in the first half of 2013 on:• the Retail segment, with an improvement in both business

and IT aspects of Basel processes (segmentation, rating, incidents, default, consolidation process). The completion of the project remains dependent on modelling work under way and the migration to the IT-CE platform;

• the Banks/Sovereigns segment, with the finalisation of all aspects required for the certification. As for the rest of the Group, this segment is currently being validated by the Group’s Inspection Générale division.

Progress was also made on the Corporate and Public sector/Social housing segments.The Crédit Foncier Group is also working with Groupe BPCE to apply the new Basel III standards from January 1, 2014.

1.4 - Information systems and quality of Crédit Foncier Group data

1.4.1 - Accounting consistency of risk data


1.4.2 - Data quality


1.5 - Summary of risk management procedures and methodsAs a general rule, the business lines are first and foremost responsible (Level One) for the risks they assume as a result of their transactions, both at the time they are entered into and throughout the term of each transaction. The Risk Management Division lays down the principles for intervention and risk monitoring and management by preparing a risk policy in line with the Group policy, and disseminating it to the Business Lines.

In the first half of 2013:• the exposure rules for Individual customers were tightened

in order to exclude the riskiest cases;• the supervision levels for loan production by rating were

updated to conform with risk levels stemming from budget objectives;

• the control framework for ALM financial risks was strengthened.


1.5.1 - Authorisations and risk control procedures


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1.5.2 - Procedures for assessing creditworthiness

Under the Basel projects implemented in coordination with Groupe BPCE, a new version of the Individual customer credit scoring tool was rolled out in the first half of 2013.The new loan outstanding and approval scoring tool produces more accurate risk categories.


1.5.3 - Risk monitoring


1.5.4 - Consolidated risk monitoring


2 - Scope of application2.1 - Accounting consolidation scope and prudential consolidation scope (Basel method)The prudential consolidation scope, as defined in the French decree of February 20, 2007 on capital requirements, is identical to the accounting consolidation scope (see Note 7 of Crédit Foncier’s consolidated financial statements).

2.2 - Scope of application within Crédit FoncierThe credit institutions whose individual management ratios are supervised within the framework of Group consolidated management ratios, in compliance with the provisions of articles 4.1 and 4.2 of regulation No. 2000-03 of the CRBF (French Committee on Banking and Financial Regulation), have been identified in the statutory consolidation scope (see Note 7 of Crédit Foncier’s consolidated financial statements).

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3 - Internal capital adequacy and regulatory capital requirements3.1 - Capital managementMonitoring of the Crédit Foncier Group’s equity capital has the dual goal of complying with regulatory ratios and optimising the allocation of capital and return on capital generated by the Group’s activities. This monitoring is carried out each quarter by the Executive Management team.

Crédit Foncier Group uses the standardised approach to calculate capital requirements for all its portfolios.

In the first half of 2013, the Crédit Foncier Group contributed to preparatory work, according to Groupe BPCE’s certification schedule, to apply the standardised approach to calculate capital requirements on banking and sovereign commitments.

Groupe BPCE has carried out internal stress tests since 2011. In terms of credit risk, the internal stress test is based on a methodology that is, on the whole, similar to that of the stress tests performed by regulators, but with macroeconomic assumptions defined at the Groupe BPCE level over a two-year period. This consolidated Group-based stress test factors in the specificities of each major Group entity (Natixis, Crédit Foncier and the Banque Populaire and Caisse d’Epargne networks) when calibrating the risk parameters.

3.2 - Composition of prudential capitalPrudential capital is determined in accordance with amended regulation 90-02 of February 23, 1990 of the CRBF (French Committee on Banking and Financial Regulation).

It is broken down into two categories (core capital and supplementary capital), from which a number of deductions are taken:• core capital is determined from the Group’s consolidated

equity (excluding unrealised or deferred gains or losses), taking into account positive net income for the period, adjusted for items recorded under “prudential filters”. These adjustments consist primarily of deductions of goodwill and other intangible assets;

• supplementary capital includes certain subordinated debt. A discount is applied to subordinated debt with a maturity of less than five years;

• the following deductions are made to determine prudential capital at a rate of 50% of Tier-1 capital and 50% of Tier-2 capital: the components of prudential capital in credit institutions and financial companies more than 10%-owned by the Group and securitisation positions are weighted at 1,250%.

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(in €m)

PRUDENTIAL CAPITAL TABLE 06/30/2013 12/31/2012

CORE CAPITAL

Share capital 1,732 1,732

Reserves and retained earnings 2,260 2,268

Minority interests 97 96

Profit or loss 10 7

Dividend payment

Income from unrealised gains/losses subject to prudential restatements 9 37

Issues of Tier-1 hybrid securities 280 280

Deductions from core capital -48 -48

o/w goodwill -43 -43

o/w other intangible fixed assets -5 -5

Other core capital items -73 -109

CORE CAPITAL BEFORE DEDUCTIONS (A) 4,267 4,261

SUPPLEMENTARY CAPITAL

Level one supplementary capital 10 6

Level two supplementary capital 280 280

Deductions from supplementary capital

SUPPLEMENTARY CAPITAL BEFORE DEDUCTIONS (B) 290 286

DEDUCTIONS FROM EQUITY CAPITAL

Investments and subordinated loans in credit institutions or financial institutions -1 -1

Other deductions -97 -77

Equity holdings in insurance entities

DEDUCTIONS FROM EQUITY CAPITAL (C) -98 -77

of which

Deductions from core capital -49 -39

Deductions from supplementary capital -49 -39

Deductions from overall capital

TOTAL PRUDENTIAL CAPITAL (A)+(B)+(C) 4,459 4,470

of which core capital 4,218 4,223

of which supplementary capital 241 247

of which deductions from overall capital

Source: COREP, 12/31/2012 and 06/30/2013.

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3.3 - Capital requirementsThe Crédit Foncier Group calculates regulatory capital requirements for both credit risk and operational risk according to the standardised method under current regulations. The Crédit Foncier Group is not subject to market risk disclosure rules.

(in €m)

REGULATORY CAPITAL REQUIREMENTS 06/30/2013 12/31/2012

CREDIT RISK

Public administrations and central banks 13 15

Institutions 386 400

Corporates 772 803

Retail customers 1,318 1,310

Equities 39 37

Securitisation positions 815 717

Other non-credit obligation assets 46 51

TOTAL REQUIREMENTS FOR CREDIT RISK (A) 3,389 3,333

TOTAL REQUIREMENTS FOR MARKET RISK (B) - -

TOTAL REQUIREMENTS FOR OPERATIONAL RISK (C) 111 112

CAPITAL REQUIREMENTS (A)+(B)+(C) 3,500 3,445

By convention, earnings are presented by initial asset class (before substitution of the final counterparty’s risk-exposed asset class, for exposures covered by a personal guarantee).

83% of these capital requirements concern exposures to businesses, retail customers and securitisations.

The average Basel II credit risk weighting (excluding the “other assets” class) is 30%, reflecting the low level of risk of Crédit Foncier’s portfolio of loans, as most loans are backed by mortgages or guarantees.

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(in €m)

CAPITAL REQUIREMENTS FOR CREDIT RISK

With breakdown of VaR according to Basel II regulatory weightings - at 06/30/2013

Public administrations

and central banks

Institu-tions

CorporatesRetail

customers (2) EquitiesSecuriti-

sationsTotal

Weighted assets

Credit risk requirements

Gross exposure (1) (on- and off-balance sheet)

11,376 45,551 17,166 53,092 726 14,269 142,180

Value at risk (3) 10,696 44,567 15,554 51,608 726 14,200 137,351

WEIGHTING AFTER TAKING INTO ACCOUNT THE CREDIT RISK MITIGATION TECHNIQUE

0% 10,126 20,961 1,548 4,097 - - 36,732 - -

7% - - - 205 - - 205 14 1

10% - - - - - - - - -

15% - - - 13,058 - - 13,058 1,959 157

20% 408 23,407 4,137 3,635 419 6,744 38,750 7,750 620

35% - - 1,541 23,839 - - 25,380 8,883 711

50% 162 122 582 137 - 2,600 3,603 1,802 144

75% - - - 5,368 - - 5,368 4,026 322

100% - 76 7,264 1,138 - 3,644 12,122 12,122 970

150% - 1 482 131 265 - 879 1,319 105

350% - - - - - 1,114 1,114 3,899 312

Other weightings - - - - 42 - 42 11 1

Deducted from equity capital

- - - - - 98 98 1,225 -

Total value at risk 10,696 44,567 15,554 51,608 726 14,200 137,351 43,010 3,343

Total weighted value at risk 163 4,820 9,645 16,473 493 10,192 41,784

Average weighting 2% 11% 62% 32% 68% 72% 30%

Credit risk requirements 13 386 772 1,318 39 815 3,343

OTHER NON CREDIT-OBLIGATION ASSETS 46

TOTAL CREDIT RISK REQUIREMENTS 3,389

(1) Source: COREP at 06/30/2013, based on a slightly different structural presentation compared to the presentation of overall risk exposure under IFRS 7.(2) The Basel “Retail customers” classification consists mainly of Individuals and to a lesser extent Professionals (craftsmen, merchants, independent

professionals) and Associations.(3) Value at risk corresponds to on and off-balance sheet items to which a credit conversion factor is applied.

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3.4 - Solvency ratiosAt June 30, 2013, the capital adequacy ratio * stood at 10.2% and the Tier-1 ratio was 9.6%. This ratio complies with the minimum Tier-1 ratio set by the Autorité de Contrôle Prudentiel (ACP - French Prudential Supervisory Authority), which has been 7.5% since September 30, 2011*.

Capital adequacy ratio trends

10.7% 10.4%

10.2%

9.6% 9.8% 9.9%

8%

9%

10%

11%

12%

june-12 dec.-12 june-13

Capital adequacy ratio Tier-1 ratio

4 - Credit and counterparty risk exposures4.1 - Analysis of commitmentsIn the interest of clarity and consistency, since the decree of end-2008 Crédit Foncier has chosen to unify the disclosures provided under IFRS 7, Pillar 3 of Basel II (Section IX of the decree of February 20, 2007) and the Financial Stability Forum (G7). The risk management disclosures required within this framework and the capital disclosures required by amendment IAS 1 form an integral part of the financial statements, which were subject to a limited review by the Statutory Auditors.

4.1.1 - Credit risk


4.1.2 - Counterparty risk


* Basel II, standardised approach, pillar 2.

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4.1.3 - Overall credit risk exposure (IFRS 7 summary)

4.1.3.1 - Table summarising overall credit risk exposure

Overall net credit risk exposure

The table below shows all of the Crédit Foncier Group’s exposures, including financial guarantees given and signed commitments, net of impairment losses.

(in €m)

Consolidated contribution 06/30/2013 12/31/2012

See note 7.2.2 to the consolidated financial

statements

OVERALL NET CREDIT RISK EXPOSURE (1) 146,347 158,253

Central banks (2) 19 3,706

Financial assets at fair value through profit or loss (excl. variable-income securities)

2,914 3,438

Hedging derivatives (3) 7,524 10,317

Available-for-sale financial assets (excl. variable-income securities) 3,490 3,489

Interbank transactions 17,057 18,578

Customer transactions 105,292 108,741

Held-to-maturity financial assets 136 135

Sub-total (excluding financial guarantees given and signed commitments) 136,432 148,404

Financial guarantees given 1,249 1,276

Signed commitments 8,666 8,573

(1) Net outstandings after impairment.(2) Demand deposits with central banks have been included in the credit risk table as of June 30, 2013. Comparative data as at December 31, 2012 have

therefore been restated in the amount of €3,706m on the "Central banks" line entry.(3) Amounts offset under liabilities (see the consolidated financial statements).

Credit risk exposures by Basel classification taken from COREP include total assets, including off-balance sheet commitments (signed commitments and financial guarantees

given) to which a credit conversion factor is applied, and are as follows:

(in €m)

06/30/2013 12/31/2012

Amount % Amount %

Credit risk exposures by category

Public administrations and central banks 11,376 8% 15,028 10%

Institutions 45,551 32% 48,690 32%

Corporates 17,166 12% 17,434 12%

Retail customers * 53,092 37% 52,962 35%

Equities 726 1% 717 <0.5%

Securitisations 14,269 10% 16,491 11%

Credit risk exposure 142,180 100% 151,321 100%

* The Basel “Retail customers” classification consists mainly of Individuals and to a lesser extent Professionals (craftsmen, merchants, independent professionals) and Associations.

The breakdown of the Crédit Foncier Group’s exposures by Basel category at June 30, 2013 shows a concentration in

the Basel “Retail customers” segment (37%) and in the “Institutions” segment (32%).

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Overall gross credit risk exposure

The following table shows all of the Crédit Foncier Group’s IFRS exposures, at December 31, 2012 and at June 30, 2013,

before impairment, including financial guarantees given and signed commitments.

(in €m)

06/30/2013 12/31/2012

OVERALL GROSS CREDIT RISK EXPOSURE (1) 147,269 159,115

o/w excluding financial guarantees given and signed commitments (2) 137,328 149,236

o/w OUTSTANDING CUSTOMER LOANS (2) 111,234 118,713

RETAIL (2) (a) 58,951 59,193

of which outstanding direct loans (France and Europe) 49,683 49,017

o/w securities backed by residential mortgage loans (RMBS) in Europe (4) 9,268 10,176

CORPORATES (public and private sector) 52,283 59,520

Public sector corporates (2) (b) 43,832 50,921

o/w direct loans to the French public sector 24,848 25,181

o/w French Local Authorities (FLA) 16,682 17,279

o/w Social housing 8,166 7,902

o/w direct loans and commitments on international public sector and sovereigns 13,789 19,166

o/w French sovereigns (5) 1,264 5,193

o/w International 12,525 13,973

o/w securities backed by loans with government or institutional guarantees (6) 5,195 6,574

Private sector corporates (2) (c) 8,451 8,599

o/w direct loans and obligations (3) 8,184 8,322

o/w securities backed by commercial mortgage loans (CMBS) 267 277

O/W BANKS AND OTHERS (2) (d) 26,094 30,523

(1) Gross outstandings before impairment, excluding reverse mortgages €617m.(2) Adjusted management figures.(3) Obligations = reclassification of three International Public Financing counterparties as Corporate customers in line with the Basel II resegmentation carried

out in Q1 2012.(4) Including the Elise mutual fund.(5) Demand deposits with central banks have been included in the credit risk table as of June 30, 2013. Comparative data as at December 31, 2012 have

therefore been restated in the amount of €3,706m on the “French sovereigns” line entry.(6) Including two mutual funds.

(a), (b), (c), (d): The relative weight in percentage terms is illustrated on the following page.

Credit risk exposure fell by 7.4% at June 30, 2013. This decline was due to the reduction in outstanding customer loans (6.3%) and bank exposures (14.5%). The fall in outstanding customer loans was notably due to disposals in the International Public Financing (IPF) sector and residential

mortgage-backed securities (RMBS) and to the reduction in sovereign exposures with the Banque de France. Regarding the sale of loans to Individual customers, despite the difficult housing market, outstanding direct loans to Individuals increased by 1.4% in the first half of 2013.

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Exposures by Basel category

June 30, 2013

Individuals (a)43%

Public Sector corporates (b) 32%

PrivateSector corporates (c)6%

Banks and others (d)19%

€137,328m

December 31, 2012

Individuals (a)40%

Public Sectorcorporates (b) 34%

PrivateSectorcorporates (c)6%

Banks and others (d)20%

€149,236m

Source: adjusted management figures. Balance-sheet commitments (excluding signed commitments and financial guarantees given) representing overall credit risk exposure under IFRS consolidated gross figures (performing and doubtful).(a), (b), (c), (d): bases are indicated in the above table.

4.1.4 - Breakdown of credit risk exposures

4.1.4.1 - Geographic breakdown

The geographic breakdown of the portfolio at June 30, 2013 was stable against December 31, 2012. Commitments in the European Economic Area account for 92% of the portfolio, and commitments in France increased from 72% to 74% as other international exposures were reduced.

Commitments located in the European Economic Area mainly include Crédit Foncier-eligible assets; other commitments in the European Economic Area are almost entirely made up of bank commitments for cash management or derivatives transactions.

As a reminder, commitments located in the United States consist only of securities issued by highly-rated States or local authorities or guaranteed by the federal government. They do not include any direct or indirect real estate exposures.

Geographic breakdown of exposures

06/30/2013 12/31/2012

France 74% 72%

Other European Economic Area countries

18% 18%

• o/w Germany 2% 2%

• o/w Spain 5% 4%

• o/w Italy 5% 5%

• o/w Netherlands 2% 3%

• o/w other countries <1% 4% 4%

Switzerland 2% 2%

North America (US and Canada) 5% 6%

Japan 1% 2%

Others <0.5% <0.5%

Balance sheet total 100% 100%

Balance sheet assets (in €m) 137,328 149,236

Source: adjusted management figures. Balance-sheet commitments (excluding signed commitments and financial guarantees given) representing overall credit risk exposure under IFRS consolidated gross figures (performing and doubtful).

4.1.4.2 - Sector breakdown

The breakdown of outstanding balance-sheet loans by business sector excludes direct loans to Individual customers (e49.7m at end-June 2013). It therefore includes exposures to RMBS in Europe, for which the final risk is linked to individual customers.

The five leading sectors account for 95% of these exposures. Excluding bank exposures (close to half of which are intra-group commitments), their nature illustrates the Crédit Foncier Group’s role in financing the real-estate and public sectors. The principal sectors are:• finance-insurance (31%), which essentially concerns the

banking sector;• administration (30%) - under the BPCE classification, this

includes local authorities and sovereigns;• securitisation (16%), with real estate or public sector

underlyings only;• real estate overall is stable at 14%.

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Crédit Foncier also provides real estate financing to other sectors.

Lastly, the “Others” line covers a number of different sectors (transport, tourism, construction, communication, agri-food, energy, etc.).

Sector breakdown of credit risk exposures * (excluding direct loans to Individuals)

06/30/2013 12/31/2012

Finance-Insurance 31% 31%

The top five

business sectors

account for 95%

Administration 30% 31%

Securitisation 16% 17%

Property rentals 13% 12%

Pharmaceuticals-Healthcare

5% 4%

Real estate 1% 1%

Others 5%

Services 1% 1%

Utilities * 1% -

Energy 1% 1%

Holding companies and diversified

- 1%

Others 1% 1%


Balance sheet assets (in €m)

87,644 100,219

Source: adjusted management figures, excluding retail customers and banks. Balance-sheet commitments excluding direct loans to individual customers (excluding signed commitments and financial guarantees given) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).* Classified in "Others" at December 31, 2012.

4.1.4.3 - Breakdown of exposures by product family

The breakdown of the Crédit Foncier Group’s balance sheet commitments (loans, securities and financial transactions) by product family at June 30, 2013, shows a concentration of exposures on loans (61%) and securities (21%, with 10% for securitisations and 11% for bonds). This breakdown remains comparable to that observed at end 2012.Note that at since 2012, Crédit Foncier has optimised its derivatives portfolio by reducing the number of outstanding contracts. As a result, derivatives have fallen from 10% to 6% of exposures.

Product families (breakdown as a %)

06/30/2013 12/31/2012

Loan book * 61% 57%

Cash facilities 12% 11%

Bonds (banking) 11% 11%

Securitisation 10% 11%

Derivatives 6% 10%

Shares/funds - -

Other balance sheet products - -

Bonds (Trading **) - -


Balance sheet assets (in €m) 137,328 149,236

Source: adjusted management figures, excluding retail customers and banks. Balance-sheet commitments excluding direct loans to individual customers (excluding signed commitments and financial guarantees given) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).* Customer loans excluding cash facilities.** Crédit Foncier does not own any trading securities; bonds are held in

connection with credit transactions or for hedging the ALM portfolio.

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4.1.5 - Losses and cost of risk

Crédit Foncier Group’s risk hedging

(in €m)

Exposures 06/30/2013 12/31/2012

Balance sheet

Doubtful loan

percentage

Doubtful loan percentage

(excl. subsidised

sector)

Balance sheet

Doubtful loan

percentage

Doubtful loan percentage

(excl. subsidised

sector)

Retail 58,951 3.68% 3.66% 59,193 3.38% 3.34%

• Direct loans (France and Europe) 49,683 4.37% 4.34% 49,017 4.08% 4.03%

• RMBS in Europe 9,268 - - 10,176 - -

Public sector 43,832 <0.5% <0.5% 50,921 <0.5% <0.5%

• French public sector 24,848 <0.5% <0.5% 25,181 <0.5% <0.5%

• IPF and Sovereigns (direct loans and obligations) 13,789 - - 19,166 - -

• Securities backed by individual customer loans with government or institutional guarantees

5,195 - - 6,574 - -

Private corporate sector 8,451 9.98% 9.11% 8,599 10.32% 9.54%

Exposure to banking sector and other 26,094 <0.5% <0.5% 30,523 <0.5% <0.5%

TOTAL 137,328 2.23% 2.16% 149,236 1.95% 1.88%

Source: adjusted management figures, excluding retail customers and banks. Balance-sheet commitments excluding direct loans to individual customers (excluding signed commitments and financial guarantees given) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).

The increase in doubtful loans in the first half of the year was concentrated on direct loans to Individual customers, and was caused by an increase in the number of new cases referred for debt workout procedures. The percentage of doubtful loans in the private corporates segment fell from 10.3% to 10%, reflecting an improvement in the intrinsic quality of the portfolio and enhanced loan monitoring, in particular regarding rental vacancies and pre-construction sales terms and conditions. Doubtful loans to the public sector rose very slightly, mainly concerning the social housing portfolio.

Cost of risk - Individuals and Corporates

At June 30, 2013, cost of risk amounted to €65m, stable against the previous year (net provision of €127m at December 31, 2012).

Cost of risk at end-June 2013 broke down as follows:• an individual cost of risk of €47m; the trend observed on

retail customers in 2012 was confirmed in the first half of 2013, with an increase in losses and a fall in the value of certain guarantees. Individual provisions on corporate customers fell from €38m in 2012 to €11m, most of which can be attributed to the deterioration of a single loan;

• cost of risk on a portfolio basis (collective provisions) amounted to €18m; the allowance was mainly recorded on the Individuals and Public sector corporates portfolios.

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(in €m)

FY 2012 Allocations Net reversalsLosses on non-

hedged receivables

Recoveries of amortised

receivablesH1 2013

Interbank loans and receivables 0 0 0

Customer loans and receivables -129 -220 157 -16 13 -66

Other financial assets 0 0 0 0

Signed commitments 2 -1 2 1

Cost of risk - Individuals and Corporates (A)

-127 -221 159 -16 13 -65

of which individual cost of risk -121 -48

of which cost of risk on portfolio basis (collective provisions)

-6 -17

Overall credit risk exposure * (B) 159,115 147,269

Cost of risk as % of total exposures (C=A/B) -0.08% -0.04%

* Total credit risk exposure: gross outstandings (performing and doubtful) including off-balance sheet commitments.

The total cost of risk is consistent with the level incorporated into the pricing structure for setting the ROE target during credit approval. This amounted to 0.04% of credit risk exposures in the first half of 2013, which is stable compared with the figure recorded for the full year 2012 (0.08%).

Cost of risk - Sovereigns

Crédit Foncier recorded no cost of risk on this customer segment in the first half of 2013.

4.1.6 - Risk diversification and concentration risk

The table below shows the weight of the leading counterparties in a specific category, respectively the 10, 20, 50 and 100 largest counterparties. It should be read in the light of their relative weight in terms of amounts. This ranking was established on groups of counterparties and exposures, including signed commitments and financial guarantees given.

For securitisations, which account for a significant proportion of the portfolio of large counterparties, over 93% of risks are concentrated in the top 50 exposures. This concentration can be attributed to the strategy implemented by the Crédit Foncier Group a number of years ago, aimed at acquiring large-scale deals on the primary market. In terms of credit risk, this concentration is only apparent since the underlying assets are mainly housing loans to individuals and therefore have a high degree of granularity.

The French Local Authorities-Social Housing sector and large corporates have a much lower concentration, reflecting the risk diversification policy.

Direct exposure to Sovereigns is concentrated (fewer than 20 counterparties) as only a few European states are concerned.

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Summary - Concentration of major counterparties in millions of euros and as a percentage at June 30, 2013

Exposures by Basel category Top 10 Top 20 Top 50 Top 100 Total

Securitisation5,977[42%]

9,334[65%]

13,238[93%]

14,269[100%]

14,269

FLAs and Social Housing *3,884[14%]

5,891[22%]

9,629[35%]

13,198[48%]

27,081

Large corporates1,473

[22%]2,181

[33%]3,389[51%]

4,516[68%]

6,626

International Public Financing4,306[49%]

5,923[68%]

8,122[93%]

8,715[100%]

8,715

Sovereigns6,060

[100%]6,074

[100%]6,074

[100%]6,074

[100%]6,074

Specialised financing1,655[47%]

2,255[64%]

3,189[90%]

3,540[100%]

3,541

Source: adjusted management figures, excluding retail customers and banks. Balance-sheet commitments excluding direct loans to individual customers (excluding signed commitments and financial guarantees given) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).* Including general public administrations (8411Z).

4.2 - Commitments by customer portfolio

4.2.1 - Individual customers

4.2.1.1 - Direct loans

4.2.1.1.1 - Direct real estate loans

The vast majority of outstandings are backed by Basel II-eligible guarantees, with a high proportion of first-rank mortgages. A portion of regulated loan production are also backed by a SGFGAS counter-guarantee. The remaining outstandings are backed by a guarantee provided by Compagnie Européenne de Garanties et Cautions (SACCEF), Crédit Logement or a mortgage insurance company. Pledges can be added to these guarantees.

Loan production and change in outstanding loans to Individuals at June 30, 2013New loans distributed in the first half of 2013 confirmed the strong performance of new real estate loans to Individuals, which amounted to €3.6bn, an increase of nearly 22% on the same period of the previous year. Very low interest rates were one of the main factors behind this increase, mainly on the home-ownership market. In this favourable environment, new loan origination was subject to stricter selection criteria. The tightening of loan approval terms led to a significant increase in credit scores, with favourable loan scores accounting for 82% of outstandings subject to credit scoring, compared with

58% at the end of 2012, for all market segments. Uncertain scores amount to only 1% of the scope.

On the home-ownership market, debt ratios remained below 35% on almost all loan production (99%).Personal deposits accounted for a greater portion of the total transaction amount.Almost all loan production were issued at a fixed rate over the entire term (99% like in 2012, compared with 95% in 2011). Regulated loans (PTZ interest-free loans and PAS state-subsidised loans to low-income families) accounted for 58% of new loan volumes, versus 51% in 2012.

Quality of outstanding direct loans and internal scoringOutstanding loans to Individuals in France increased by 1.6% between December 2012 and June 2013. Home-ownership loans accounted for 73% of the total, with 37% of these loans being state-subsidised loans (PAS/PTZ loans). Despite a fall in demand for residential property in 2012 and an increase in prepayment requests for pricing reasons, the portfolio of outstanding loans to Individuals was stable.

Fixed-rate loans comprised 71% of outstandings, and this figure is rising steadily (69% in 2012 and 64% in 2011).

Internal scoring

As part of preparatory work for the certification of internal credit risk scoring models, adjustments were made to the scoring model (NIF) in the first half of the year. Pro forma figures are shown in order to facilitate comparison.

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The breakdown below indicates the quality of outstanding direct loans to individuals: 59% have a favourable rating, down slightly from December 2012 (61%). Including acceptable ratings, the percentage stands at 85%. This breakdown is close to that recorded at the end of 2012, with the Basel II default ratio stable at 4% at end-June 2013. The portion of non-rated loans was stable at 5%. The risk profile on the portfolio of direct loans to Individuals was comparable to that at the end of 2012.

61%

26%

5% 4% 2% 3%

59%

26%

6% 4% 2% 3% 0%

10%

20%

30%

40%

50%

60%

70%

80%

Favourable(3 to 7)

Acceptable(8)

Uncertain(9)

Default Not rated - CréditFoncier

Not rated -subsidiaryand branch(exemptions)

Pro forma Dec.-12 NIF V2: €48,717m

June-13: €49,501m

Source: management figures. Commitments at end of period (including signed commitments and financial guarantees given), gross figures (performing and doubtful).

Real estate bridging loans to Individual customers

After falling sharply in previous years, outstanding bridging loans rose by 3.4% in the first half of 2013, amounting to €362m at end-June, compared with €350m at year-end 2012. They accounted for 0.7% of total loans to Individuals. Bridging loans are subject to enhanced vigilance, particularly regarding the value of the assets covered by the loan and the liquidity of the assets backing the bridging portion of the loan.

Loss analysis - arrears

Loan losses increased by 0.4 point to 4.9% of outstanding amounts.

Out-of-court collection, insolvency and litigation involving Individual customers

In what remains a tough economic environment, cases of over-indebtedness referred for debt workout measures recorded the sharpest increase (0.2 point). The first half-year recorded a sharp increase in the number of contracts being managed under the debt workout plans negotiated by the Litigation department in late 2012.The percentage of outstanding loans subject to out-of-court collection was stable despite a high number of new entries, which was offset by a high exit rate.

Outstanding loans in dispute increased slightly, by 10bp.However, the increase in losses had a minimal impact on the cost of risk, which remained comparable to that recorded in the first half of 2012.

Percentage of loans in arrears by level of arrears

Litigation

Total outstanding *

Debt workout plansOut-of-court collection

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

€47,308m 4.5%

1.9%

0.4%

2.2%

12/31/12

4.9% €47,919m

1.9%

0.6%

2.3%

06/30/13

* Management data, gross outstandings under management, excluding Banco Primus and the Belgian branch.

4.2.1.1.2 - Loan restructuring and auto financing

Banco Primus, a subsidiary of Crédit Foncier subsidiary headquartered in Lisbon, sells car loans in Portugal. Prior to this strategic refocusing that began in 2011, this subsidiary specialised in restructuring mortgages for individual customers in Spain and Portugal and marketing auto loans in Hungary.

TOTAL OUTSTANDINGS at June 30, 2013 €631m

o/w outstanding mortgages in Portugal €96m

o/w outstanding mortgages in Spain €231m

o/w outstanding auto loans in Portugal €275m

o/w outstanding auto loans in Hungary €29m

Average LTV (mortgage business) 70%

Arrears of 90 days or more (auto loans in Portugal) 9%

Default provisioning rate (auto loans in Portugal) 74%

Capital adequacy ratio (Core Tier 1) 12%

In the first half of 2013, the company’s portfolio continued to decline as a result of slower-than-expected new car loan origination in a weak market and the amortisation of outstanding loans on other activities.

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The vehicle financing activity in Portugal accounts for 44% of outstanding loans.

In Portugal, outstanding mortgage loans suffered from the quality of the initial loan production, with over 53% of amounts in dispute at end-June 2013. The risk on loans in dispute is monitored on an individual basis to ensure that adequate provisions are recorded.

In Spain, the bank has acquired real estate assets under repossessions and has begun to dispose of these assets at a discount on the depressed local real estate market.

In general, the risk parameters on these activities (PD, LGD) were raised in order to ensure optimum risk monitoring on these loans.

4.2.1.2 - Risk transfer transactions

No risk transfer transactions were carried out in the first half of 2013.

4.2.1.3 - Positions on residential mortgage-backed securities (RMBS) in Europe

Securitisation and residential mortgage acquisition activities are addressed in a separate section of this report, in accordance with the rules of financial transparency (see section 6.3.1 in Chapter 6 - Securitisations - for more details).

4.2.2 - Public sector portfolio

4.2.2.1 - French public sector

During the first six months of 2013, outstanding direct loans to the French public sector (€24.8bn at June 30, 2013), which include French local authorities and social housing, increased by 0.8%. The doubtful loans ratio remained close to zero.

4.2.2.1.1 - French Local Authorities (FLA)

The Crédit Foncier Group partners with Groupe BPCE networks in financing activities targeting French local authorities and institutions.

Outstanding loans to French local authorities fell in the first half of 2013, though it should be noted that local authorities and institutions take out the majority of their loans at the end of the calendar year.

The quality of outstandings remained high with 93% of favourable or acceptable scores. 87% of outstanding loans to French local authorities are rated in the “favourable” category.

Exposures by internal rating for the French Local Authorities portfolio

85%

9% 8% 1%

0 %

87%

4% <0.5% <0.5%

<0.5 % <0.5%

6% 0%

20%

40%

60%

80%

100%

Favourable Acceptable Uncertain Otherformats

Default Not rated

Dec.-12: €17,279m

June-13: €16,682m

Source: management figures. Balance-sheet commitments (excluding signed commitments and financial guarantees given) representing overall credit risk exposure under IFRS consolidated gross figures (performing and doubtful).

4.2.2.1.2 - Social housing

This business line originates regulated loans (“prêt locatif social” - PLS; “prêt social location accession” - PSLA; “prêt locatif intermédiaire” - PLI) and unregulated loans for the social housing sector in collaboration with Groupe BPCE.

In the social housing sector, the majority of loans were granted under the auction of PLS loans by Caisse des Dépôts et Consignations, as Crédit Foncier is one of the main originators of these loans. Crédit Foncier is active in financing social housing projects and medical-social centres (retirement homes, care homes), which are attracting strong demand and are largely supported by the government. These transactions are backed by guarantees provided by local authorities or by mortgages.

Outstanding amounts increased by 3.3% in the first half of 2013.

The relative proportion of counterparties rated “favourable” is high (79%). This percentage stands at 80% including outstandings rated “acceptable”.

The risk profile of non-rated exposures is solid: it mainly comprises organisations that receive the Employers’ Contribution to the Construction Effort (6) and their subsidiaries, which are not covered by BPCE’s scoring systems. When the commitment decision is taken, these counterparties are subject to an individual analysis.

(6) The Employers’ Contribution to the Construction Effort (PEEC) is a mechanism in which private, non-agricultural companies employing 20 employees or more (10 employees or more prior to 2006) contribute to the construction of new homes. This programme was formerly known as the “1% Logement” scheme.

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Exposures by internal rating for the Social housing portfolio

0%

20%

40%

60%

80%

100%

Favourable Acceptable Uncertain Otherformats

Default Not rated

Dec.-12 €7,902m June-13 €8,165m

4% <0,5%

<0,5% <0,5%

6% 1%

16%

1% 0%

19%

73% 79%

Source: management figures. Balance-sheet commitments (excluding signed commitments and financial guarantees given) representing overall credit risk exposure under IFRS consolidated gross figures (performing and doubtful).

4.2.2.2 - International Public Financing (IPF) and Sovereigns

Crédit Foncier’s IPF and Sovereigns portfolio was placed in run-off in the second half of 2011 and disposals continued in 2012 and the first half of 2013.This portfolio included:• funding for European sovereign states, either directly or

via government-backed organisations. The credit analysis of these entities is performed with the analysts of Groupe BPCE and Natixis;

• funding for international local authorities in European countries, the United States, Canada and Japan: Federated states, the “Länder”, districts and provinces (i.e. local authorities with real fiscal autonomy, depending on the jurisdiction), regions, departments, counties, prefectures and cities.

4.2.2.2.1 - International Public Financing

Outstandings in the IPF portfolio are concentrated in eurozone countries, Switzerland, Japan, Canada and the United States. For accounting purposes, the vast majority of the portfolio is classified as Loans and Receivables.

Outstanding loans at June 30, 2013 amounted to €8.7bn, compared with €9.9bn at year-end 2012, a decline of nearly €1.2bn (12%). The reduction in exposures over the period was a result of disposals (€297m nominal on US and European public sector counterparties) and the portfolio’s natural amortisation. International Public Financing exposures are also affected by changes in interest rates on the hedged component and securities in foreign currencies are impacted by foreign exchange rates (mainly USD, JPY and CHF).

Exposures * by internal rating for the International Public Financing portfolio

June 30, 2013

€8,715m

Not rated6%

BBB20%

BB6%

A26%

AA41%

AAA1%

December 31, 2012

€9,906m

Not rated6%

BBB18%

BB5%

A20%

AA50%

AAA1%

These charts show the portfolio’s concentration in higher ratings categories (42% of the portfolio is in the Step 1 ≥AA- category); this proportion was lower than at year-end 2012 (51%) as the ratings of several Japanese public sector counterparties were downgraded.

The remainder (6% “not rated”) corresponds to certain assets not assigned an internal rating. The corresponding risks are assessed as being at least equivalent to the A category based on external ratings.

Internal ratings on the IPF portfolio are overall in line with ratings agency ratings (internal ratings are on average 0.2 notches below external ratings).

4.2.2.2.2 - Sovereigns

Crédit Foncier’s Sovereigns portfolio comprises the outstandings of French sovereigns as well as exposures to foreign sovereigns, which have been in run-off since the second half of 2011.

* Balance-sheet commitments at end of period (excluding signed commitments and liabilities) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).

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At June 30, 2013, outstandings in the Sovereigns portfolio amounted to €5bn, compared with €9.3bn at end-2012, a reduction of 45% over the period, attributable to several factors:• Crédit Foncier significantly reduced its treasury investments

with the Banque de France in the first half of the year. At the end of 2012, it placed €3.7bn with the Banque de France in anticipation of significant redemptions of covered bonds due in the first half of 2013;

• disposals carried out during the period in connection with the run-off of the international financing portfolio: Crédit Foncier reduced its exposure to Slovenia (€33m in nominal), the Czech Republic (€24m) and Slovakia (€20m).

These amounts represent the net carrying amount under IFRS (without taking swaps into account) of micro-hedged assets at their equivalent value in euros (classified as Loans and Receivables or available-for-sale assets). The change in outstandings is also due to fluctuations in the rate of the hedged component.

Exposures * by internal rating for the Sovereigns portfolio **

June 30, 2013

AAA to AA-25%

A+ to A13%

A- to BBB+53%

BBB to BBB-7%

BB- to B1%

BB+ to BB1%

€5,074m

December 31, 2012

AAA to AA-59%

A+ to A33%

A- to BBB+5%

BBB to BBB-2%

BB+ to BB1%

€9,260m

Owing to the reduction in treasury investments with the Banque de France, the portfolio’s outstandings with a Step 1 (≥AA) rating fell sharply, from 59% to 25% of total outstandings. The proportion of outstandings rated [A- or BBB+] increased sharply, from 5% to 53% of total outstandings due to the downgrading of the Italian sovereign rating to A- (€2.7bn in outstandings).

408

494

2,71

0

2,77

8

222

247

210

250

144314

914

45760414100

0

500

1,000

1,500

2,000

2,500

3,000

Greece

Hungary

Cyprus

Irland

Czechrepublic

Slovakia

Slovenia

Poland

Italy

Dec.-12: €4,067m

June-13: €3,810

4.2.3 - Exposure to banks

Given the structure of its activities and its refinancing needs, Crédit Foncier manages a significant volume of exposures to counterparty banks on an ongoing basis. Most of these exposures resulted from hedging requirements associated with its various activities (mainly swaps) or with short-term treasury investments (particularly following debt issues). A significant portion of banking exposures also correspond to long-term transactions carried out in connection with the international public financing portfolio (in run-off since 2011): the corresponding portfolio is guaranteed by Sovereigns and similar guarantees (Landesbank grandfathered debt in Germany, district guarantee on Swiss district banks, etc.).

Netting and collateralisation agreements have been largely renegotiated since 2008, including with well-rated banks, in order to reduce the Crédit Foncier Group’s exposure to banking counterparties. It should be noted that since 2012, Crédit Foncier has been working to optimise its stock of derivatives by reducing the number of outstanding contracts.


** Basel II ratings after credit enhancement.

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Particular attention is paid to the banking sector, and limits on this sector have been considerably lowered since 2010. Under the Group’s strategy, Crédit Foncier limits its exposure for each banking group to 15% of its equity, which is a more conservative limit than the regulatory requirement (25%). Furthermore, since 2011, major risks associated with banking counterparties have been weighted 100% (vs. 20% previously).

Transactions with banks involve high gross volumes (nominal amounts) ultimately accounting for low net amounts due to valuations and offsetting impacts (derivative transactions are accompanied by collateralisation hedging mechanisms). The charts below present the balance-sheet value of these transactions, which does not necessarily accurately detail the credit risk incurred on derivatives transactions owing to netting and offsetting agreements.

Exposures* by internal rating for the Banks portfolio

June 30, 2013

€25,947m

AA 10%

Not rated9%

AAA 4%

BBB 1%

A 76%

December 31, 2012

€30,321m

AA 16%

Not rated6%

AAA 3%

BBB <0,5%

A 75%

4.2.4 - Private sector portfolio

The Corporate and Institutional sector only accounts for a small fraction of Crédit Foncier’s activities, most of which is comprised of direct loans, with the remainder being CMBS.

Direct loans to the private corporate sector concern several types of activities:• real estate development, housing developments and, to

a lesser extent, property dealers, via short-term loans or signed commitments, either directly or through its subsidiary SOCFIM;

• long-term investments, covering real estate asset financing in the form of conventional medium and long-term loans and real estate leasing, for which Crédit Foncier receives an intrinsic guarantee in the form of loans and signed commitments;

• public-private partnership (PPP) transactions. In this segment, Crédit Foncier usually offers specialised financing involving a revenue stream from the transaction, control over the financed assets, and a significant percentage of public guarantees.

For private sector clients, new loan origination was very limited and focused on high-quality transactions.

4.2.4.1 - Direct loans

4.2.4.1.1 - Analysis of exposures

The main private sector corporate exposures arose from property development activities in France, long-term investors and corporates totalling €5,581m at end-June 2013, stable compared to year-end 2012.

Real estate developmentOutstandings in the real estate developers and property dealers business increased in the first half of 2013 (13%). The majority of financing was granted to major clients in the real estate development sector. Transactions financed for other clients had satisfactory ratings and a solid capital to pre-construction sales ratio.

Since the start of 2013, all new loan origination in this sector has been carried out by the subsidiary SOCFIM. Crédit Foncier’s Risk Management Division is involved throughout the loan approval process.


Note: the breakdown of exposures to banks is based on management amounts.

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Strict monitoring of these activities continued, with periodic sector reviews and limited new commitments under the existing exposure management system, with the approval of Groupe BPCE’s Risk Management Division. Problematic cases related to a stable and limited number of players.

Long-term investors and specialised financingOutstandings in this sector were stable in the first half of 2013. Risk linked to long-term investors was closely monitored, particularly with respect to rental vacancies and rent trends.

Total exposure to unlet assets was €235m at June 30, 2013 versus €139m at December 31, 2012. As in the real estate development segment, here problematic loans relate to a limited number of counterparties, which are restricted by commitment budgets. The increase over the first six months of the year was half due to a transaction not yet in place and half to the opening of a new unlimited budget dedicated to enhancing environmental performance.

CorporatesFor Crédit Foncier, this sector mainly consists of leasing transactions. In order to bring the Group into line with standards, holding companies, including real estate professionals, are included in this category. Outstandings therefore increased by 3% over the period.

Real estate leasing activities benefit from an intrinsic guarantee. As the lender owns the building, it has a solid guarantee that makes it easier to lease the assets.

4.2.4.1.2 - Breakdown by rating

Internal ratings of the Private Sector Corporates portfolio

46%

23%

29%

2% <0.5%

11% 12%

10% 12%

0%

10%

20%

30%

40%

50%

60%

Favourable Acceptable Uncertain Default Otherformats

Dec.-12 €5,006m

June-13 3,739m

54%

Source: adjusted management figures. Balance-sheet commitments in France (excluding signed commitments and financial guarantees given) representing overall exposure to credit risk under IFRS consolidated gross figures (performing and doubtful).

Among Private Sector Corporates, favourable or acceptable ratings accounted for 75% of rated outstandings at end-June 2013, compared with 77% a year earlier. “Uncertain” ratings account for less than 0.5% of rated outstandings. The percentage of outstandings in default was stable at 12%.

4.2.4.2 - Other securitisation transactions

These activities are addressed in a separate section of this report, in accordance with the rules of financial transparency (see section 6.3.1 in Chapter 6 - Securitisations - for more details).

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5 - Risk mitigation techniquesThe portfolio of loans to non-public sector counterparties (Individuals, social housing, Corporates) is mostly covered by real estate mortgages or personal guarantees.

5.1 - Collateral valuation and managementFor the financing of professional assets or large home loans, the assets pledged to guarantee the loans are assessed by a property valuation expert (Foncier Expertise). The terms of these valuations were unchanged in the first half of 2013.

Crédit Foncier updates the mortgage values of pledged collateral annually. These values may be updated automatically using real estate indices showing annual trends or by an expert, depending on the type and/or amount of the collateral.

Among the loans guaranteed by a first-rank mortgage or a lender’s lien, some are doubly secured by a complementary guarantee from a mortgage insurance company or local authority. Social housing loans are predominantly guaranteed by a local authority.

5.2 - Main insurersThe main providers of personal guarantees on mortgage loans to Individual customers are the SGFGAS, mortgage insurance companies (e.g. CEGC (formerly Saccef)) as well as other credit institutions (mainly Crédit Logement and intra-group bank guarantees).• The Société de Gestion du Fonds de Garantie à l’Accession

Sociale à la propriété (SGFGAS) provides a guarantee from the French state for home ownership loans governed by regulated loan agreements and guaranteed by first-rank collateral (mortgage or lender’s lien). Accordingly, it receives the French’s government’s external ratings and allows a 0% weighting of loans covered by SGFGAS prior to December 31, 2006. Due to a change in SGFGAS coverage methods, guarantees granted thereafter have a 15% weighting for the loans in question;

• Crédit Logement is a financial institution, a subsidiary of most large French banking networks, whose long-term rating was lowered from Aa2 to Aa3 by Moody’s on April 15, 2013 and from AA- to A+ by Standard & Poor’s on June 20, 2013. Loans covered by Crédit Logement receive a 20% weighting under the standardised approach, related to the regulatory weighting applicable to credit institutions and deducted from the credit ratings of the country where the underlying collateral is located (France in this case);

• CEGC (Compagnie Européenne de Garanties et Cautions, formerly SACCEF) is a company that specialises in bank loan surety and is owned by Natixis Garanties. The downgrading of Standard & Poor’s external rating from AA- to A+ in the last quarter of 2008 changed the weighting of the outstandings covered: residential real estate loans are weighted 35% or 75% and other types of retail loan are rated 50%. The Autorité de Contrôle Prudentiel (ACP - French Prudential Supervisory Authority) authorised loans in the real estate loan portfolio guaranteed by SACCEF to be classified using the standardised approach in order to apply a single weighting of 35% at December 31, 2008 and at subsequent reporting dates until the advanced IRB approach is adopted;

• miscellaneous mortgage insurance companies (MG PTT, Mutuelle du Trésor, Mutaris Caution, etc.);

• NHG is a guarantee provided by the Dutch government on mortgages acquired by Crédit Foncier in late 2007. The portfolio of loans guaranteed by NHG totalled €73m;

• other insurers are credit institutions, mainly providing intra-group guarantees (Caisses d’Epargne and BPCE), or public sector legal persons (mainly for PPPs). Note: a financial guarantee of €3.2bn has been provided by Caisse Nationale des Caisses d’Epargne in connection with the acquisition of Ixis CIB’s French local authorities business.

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5.3 - Effect of credit risk mitigation techniquesCrédit Foncier’s portfolio is predominantly covered by first-rank mortgages or eligible personal sureties.

Loan insurers

June 30, 2013

First-rankmortgagesand otherprotection 15%

Localauthoritiesand FrenchSovereigns21%

Mortgagesecuritisation(RMBS) 8%

First-rankmortgages 24%

Public sectorsecuritisation5%

Internationallocalauthorities 12%

Other securedexposures3%

Other sureties(includingSACCEFguarantees) 10% €111bn

Developer loans,bridging loans,others2%

December 31, 2012

First-rankmortgagesandother protection 13%

Local authorities and French Sovereigns 23%

Mortgagesecuritisation(RMBS)9%

First-rankmortgages 23%

Public sectorsecuritisation6%

Internationallocal authorities12%

Other securedexposures 3%

Other sureties(includingSACCEFguarantees) 10%

€119bn

Developer loans,bridging loans, others1%

5.4 - Balance sheet and off-balance sheet nettingThe Crédit Foncier Group assesses exposures tied to derivatives by applying an add-on to current exposures. Groupe BPCE has a policy of systematically entering into framework agreements with its banking counterparties. The vast majority of the time, these are collateralisation agreements with margin call triggers that reduce the actual exposure. In the specific case of Compagnie de Financement Foncier, these agreements are asymmetrical, meaning that only the counterparties provide collateral if needed.

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6 - Securitisations6.1 - Objectives, activities and risk monitoringIt should be noted that all of Crédit Foncier’s securitisation transactions belong to the banking book and that Crédit Foncier is not an investor in any resecuritisation transactions. No further investments have been made in this segment since early 2011 and the portfolio has been placed in run-off.

6.1.1 - Objectives

The Crédit Foncier Group invests in shares of securitisations originated by third parties, mainly European financial institutions selling mortgage loan portfolios through RMBS deals.

The developments described in this section refer exclusively to tranches of securitisations held by the bank with respect to its operations as an investor and are classified in its banking book.

6.1.2 - The Crédit Foncier Group’s business, risk monitoring

In terms of securitisation, Crédit Foncier’s main objective in recent years has been to build a diversified portfolio of excellent quality loans (predominantly mortgage loans) originated outside France and with asset classes located outside France. Crédit Foncier has a strong and substantial track record with mortgage loans, which are linked to its core business: housing loans and public sector loans.

In terms of risk, the Crédit Foncier Group’s business is concentrated on transactions with a limited risk profile:• senior securities, publicly rated by one or more agencies

(AAA on acquisition), issued by entities boasting strong investor protection mechanisms: subordination of junior tranches, reserve account, interest rate differential, protection against foreign exchange and interest rate risks;

• underlyings of residential and, very marginally, commercial mortgage debt;

• underlyings of public sector debt backed by a sovereign state (FFELP student loans in the United States, NHG debt in the Netherlands) or local authority debt (healthcare securitisations in Italy).

As regards risk supervision procedures, the entire portfolio is monitored by the Risk Management Division, which holds all the necessary expertise. Groupe BPCE’s Risk Management Division also reviews the risk analysis and monitoring of the portfolio.


6.2 - Approaches and external credit ratings

6.2.1 - Approaches used

At June 30, 2013, the amounts of the weighted exposures of securitisation positions were determined using the standard method for Crédit Foncier.The weighting of securitisation positions was determined based on the tranches’ external ratings by the three major rating agencies: Moody’s, Standard & Poor’s and Fitch Ratings. At June 30, 2013, all the tranches held by Crédit Foncier were rated by external agencies (had any tranches not been rated by an external agency, a weighting of 1,250% would have been applied). If the tranche has different ratings by the three agencies, the Basel II criterion is applied: the lower of the two highest ratings issued by the three ratings agencies is used. It should be noted that exposures with a risk weighting of 1,250% were deducted directly from equity capital at June 30, 2013.

6.2.2 - Summary of accounting standards used in connection with securitisations

Crédit Foncier’s securitisation portfolio is held to maturity and is carried on the balance sheet under “Loans and receivables due from customers” (which protects the portfolio from any fair value changes). The impact of any disposals of shares held by Crédit Foncier is immediately taken to the income statement.

6.2.3 - Stress scenario for the external securitisations portfolio

The Crédit Foncier Group’s entire portfolio of mortgage-backed securities (RMBS, including NHG RMBS) is regularly stress-tested to assess the resilience of the assets held in extreme scenarios. These stress tests are carried out by Crédit Foncier’s Risk Management Division in liaison with the Groupe BPCE Risk Management Division.

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These extreme simulations involve massive defaults, falling prepayment rates and a sudden and lasting crash in real estate prices. Only the most damaging scenarios are liable to generate losses on some of the RMBS positions held by the Crédit Foncier Group. These scenarios assume a combination of events of such a magnitude that they appear unlikely at this stage:• significant increase in default rates to maturity (up to 3% per

year for Spanish and Portuguese transactions);• a sudden and lasting crash in real estate prices, varying in

magnitude by country (amounts recovered range from 30% to 40% of outstandings in Spain and Portugal);

• and a decrease in the last known prepayment rates (2% per year for Spain, Italy and Portugal).

The default models used in stress tests correspond to foreclosures, using a conservative hypothesis because, in reality, loans that have reached the default stage do not systematically lead to foreclosure.

In the event of such a “catastrophic” scenario, a final cash flow deficit could be recorded at maturity, accounting for 0.5% of the outstanding principal of the stressed transactions. The previous analysis at December 31, 2012 recorded a final cash flow deficit of 0.07% of the outstanding principal. The increase over the quarter was due to the application of stricter recovery rate assumptions, in particular in Spain.

6.2.4 - Impaired assets/external securitisations

No arrears or losses were recognised on the Crédit Foncier Group’s securitisation portfolio in the first half of 2013.

Since December 31, 2012, no assets have been subject to fair value impairment.

6.2.5 - Securitisations subject to credit enhancement

At June 30, 2013, two transactions in the portfolio were enhanced by a monoline insurer or benefited from a financial guarantee by a credit institution. These transactions amounted to €88.8m, compared with €94m at end-December 2012.

6.3 - The Crédit Foncier Group’s exposures to securitisation transactions

6.3.1 - Securitisation exposures by type of underlying asset

At June 30, 2013, the Group held a portfolio of external securitisations totalling €14,269m, down €2,290m since the end of 2012 (13.8%).

Besides natural portfolio amortisation, this significant decrease was the result of disposals under the portfolio run-off which began in 2011 and continued in 2012 and 2013. Around twenty lines amounting to €1,903m (mainly Dutch NHG, Italian and Spanish RMBS and FFELP student loans) were disposed of in the first half, generating a loss of €48m which was partially offset by the redemption of the covered bonds that had financed these lines.

(in €m)

06/30/2013 12/31/2012 Difference

Residential mortgage

MIX 84 155 -71

RMBS 9,141 9,977 -836

Total - Residential mortgage 9,225 10,133 -908

Public sector

NHG RMBS

2,254 3,456 -1,202

Sovereign states

- <0.5 <0.5

FFELP Student Loans

2,523 2,693 -171

Total - Public Sector 4,777 6,149 -1,373

Commercial mortgage

CMBS 267 278 -11

Total - Commercial mortgage 267 278 -11

OVERALL TOTAL 14,269 16,559 -2,292


For more details, please refer to section 7.6 - Securitisation glossary.

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6.3.2 - Geographic breakdown of external securitisation positions

The entire securitisation portfolio is only exposed to Europe and the United States. In Europe, the exposure is mainly to Spain (RMBS, 35% of the portfolio’s total outstandings), the Netherlands (RMBS and NHG RMBS, 20% of outstandings) and Italy (RMBS, 15% of outstandings).

The US portfolio (18% of total outstandings) is of high quality as it comprises mostly AAA-rated senior US student loan securitisations backed by the Federal government under the FFELP programme.

(in €m)

06/30/2013 12/31/2012

Country Amount % Amount %

Germany 665 4% 677 4%

Spain 4,965 35% 5,236 32%

United States 2,522 18% 2,693 16%

Europe excluding France

74 1% 78 0%

France 117 1% 117 1%

Greece 5 <0.5% 5 0%

Italy 2,173 15% 2,546 15%

Netherlands 2,850 20% 4,267 26%

Portugal 855 6% 890 5%

United Kingdom 43 <0.5% 49 0%

OVERALL TOTAL 14,269 100% 16,559 100%

Geographic breakdown of external securitisation positions

June 30, 2013

€14,269m

Europe excl. France 1%

Portugal 6%

US 18%

Spain 35%

Germany4%

United Kingdom<0,5%

Netherlands20%

France 1%

Greece <0,5%

Italy 15%

December 31, 2012

€16,559m

Europe excl. France <0.5%

Portugal 5%

US 16%

Spain 32%

Germany4%

United Kingdom<0,5%

Netherlands26%

France 1%

Greece <0.5%

Italy 15%

6.3.3 - Breakdown of external securitisation positions by rating

(in €m)

06/30/2013 12/31/2012

Amount % Amount %

Base

l II r

atin

gs

AAA 3,971 28% 5,157 31%

AA+ 578 4% 1,047 6%

AA 1,011 7% 1,037 6%

AA- 1,115 8% 1,384 8%

A+ 948 7% 1,098 7%

A 812 6% 725 4%

A- 910 6% 1,163 7%

BBB+ 1,210 8% 2,525 15%

BBB 1,120 8% 1,830 11%

BBB- 1,314 9% 64 0%

BB+ 555 4% 62 0%

BB 559 4% 323 2%

BB- - - - -

B+ - - 32 <0.5%

B 54 0% - -

B- 5 <0.5% 5 <0.5%

CCC 9 <0.5% 9 <0.5%

CC 98 1% 98 1%

TOTAL 14,269 100% 16,559 100%

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Breakdown of external securitisation positions by rating

June 30, 2013

€14,269m

≤B1%

BBB 25%

BB 8%

A 19%

AAA 28%

AA 19%

December 31, 2012

€16,559m

≤B1%

BBB 27%

BB 2%

A 18%

AAA 31%

AA 21%

Ratings were downgraded in the first half of 2013, and the Step 1 (≥AA-) category accounted for 47% of total outstandings, compared with 52% at the end of 2012. A rating migration took place in favour of A categories (19% of total outstandings versus 18% previously) and BBB-BB categories (33% versus 29% in 2012).

The ≤ B category comprises two European CMBS transactions and three RMBS transactions (two Spanish and one Greek). All these transactions are subject to specific monitoring and are included on the Watch List.

6.3.4 - Breakdown by weighting

Crédit Foncier uses the standardised approach to determine its capital requirements for securitisations. The breakdown of outstanding positions by Basel weighting is as follows:

Breakdown of external securitisation positions by rating

Basel II weighting Standardised approach

06/30/2013 12/31/2012

Amount (in €m)

%Amount (in €m)

%

20% 6,674 47% 8,624 52%

50% 2,670 19% 2,912 18%

100% 3,644 26% 4,494 27%

350% 1,114 8% 385 2%

1,250% 166 1% 145 1%

TOTAL 14,269 100% 16,559 100%

As the Basel weighting is directly contingent on the external rating of securitisation positions, the migration of ratings previously described directly led to a decrease in assets with a 20% risk-weighting (outstandings rated ≥ AA-); these assets accounted for nearly 52% of outstandings at the end of 2012, and 47% at end-June 2013.

Exposures with a risk weighting of 1,250% were deducted directly from equity capital at June 30, 2013.

6.3.5 - Securitisation positions backed by Individual-customer residential mortgage loans (RMBS) in Europe

Positions in securities backed by prime residential mortgage loans in European Union countries accounted for 65% of the securitisation portfolio (€9.2bn). Crédit Foncier has no direct or indirect exposure to the US mortgage market.

A number of external ratings were downgraded in the first half of 2013, and Step 1 outstandings (≥ AA-) accounted for 26% of the portfolio, versus 30% at end-2012. Exposures with a Basel II AAA rating were overall stable at 6% of outstanding amounts (versus 8% six months earlier).

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These declines were mainly due to:• the downgrading of securitisation ratings irrespective of the

performance of the underlying assets, under the ratings agencies’ methodology applicable following the downgrading of sovereign ratings;

• the deterioration of European countries’ economic situations affected the performance of the mortgage loans underlying the securitisations, thus warranting rating migrations linked to the increased credit risk.

Despite these ratings changes, 87% of RMBS outstandings had an investment grade rating (BBB- or higher) and the lines performed well in the stress tests carried out by the Risk Management Division simulating a significant deterioration in the performance of the securitised assets.

External RMBS securitisation positions* backed by loans to individuals

June 30, 2013

€9,225m

B1%

BBB 39%

BB 12%

A 22%

AAA 6%

AA 20%

December 31, 2012

€10,133m

B<0,5%

BBB 43%

BB 4%

A 23%

AAA 8%

AA 22%

6.3.6 - External securitisation positions in the public sector

This category comprises securitisation transactions whose underlying is backed by a guarantee issued by a public entity. Outstanding securitisation positions in this portfolio amounted to €4.8bn at June 30, 2013 (34% of total securitisations), down €1.4bn from year-end 2012. The credit quality in this category is overall satisfactory -70% of outstandings hold a Basel II AAA rating, and 88% of ratings are in the Step 1 (≥AA-) category. All lines have an Investment Grade rating.

Two types of transaction make up this portfolio:• NHG RMBS (€2,254m): Dutch mortgage loan securitisations

backed by NHG, a Dutch public entity that plays a similar role in the Netherlands as SGFGAS plays in France. The final risk on these transactions is therefore on the Dutch government. This portfolio decreased considerably compared with 2012, as positions amounting to €1.1bn were sold in the first half of 2013. The portion of positions with a Basel II Step 1 category rating fell slightly, but remains significant, at 79%, compared with 86% at year-end 2012;

• FFELP Student loans (€2,522m): securitisations of student loans backed by a Federal guarantee covering at least 98% of the outstanding principal of the underlying loans. The fall in outstandings was mainly due to disposals (nearly €0.2bn during the period). At June 30, 2012, 96% of FFELP student loans had a Basel II AAA rating.


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External securitisation positions backed by public sector assets *

June 30, 2013

€4,776m

BBB<0,5%

AA 18%

A 12%

AAA 70%

December 31, 2012

€6,149m

BBB<0,5%

AA 20%

A 9%

AAA 70%

6.3.7 - Securitisation positions backed by commercial mortgage loans in Europe

This portfolio is comprised of commercial mortgage-backed securities (CMBS). These CMBS totalled €267m at end-June 2013.

With the exception of three CMBS transactions representing €144m at June 30, 2013, which are on the watch list, the CMBS portfolio has a low level of risk (the remaining credit lines were all rated in the investment grade category at end-June 2013).

An individual provision covers 47% of at-risk CMBS.

7 - FSF reporting (G7)In its report of April 7, 2008, the Financial Stability Forum (FSF) - G7 issued a series of recommendations in response to the financial crisis, particularly in terms of financial transparency, valuation, risk management and ratings agencies.

In the conclusions of the Senior Supervisors Group report, the FSF called for improved financial communication in the following five areas:• exposure to CDOs (Collateralised Debt Obligations) or direct

exposure to monolines;• exposure to CMBS (Commercial Mortgage-Backed Securities);• other subprime and Alt-A exposure and exposure to US

mortgages more generally;• special purpose entities;• leveraged buyouts.

These disclosure requirements were discussed in a working group involving the FBF (French Banking Federation) and the AMF (French Financial Markets Authority) in order to adapt the FSF recommendations for France. Financial information tables were therefore drawn up to meet these five requirements.

7.1 - CDOs and exposures to monoline insurers and other credit enhancers

7.1.1 - Collateralised debt obligations (CDOs)

The Crédit Foncier Group has no exposure to CDOs.

7.1.2 - Credit enhancers

7.1.2.1 - Enhanced assets

The book value of credit-enhanced assets in the table below does not correspond to direct exposures to monoline insurers. It represents secondary guarantees extended by monoline companies to Crédit Foncier on some of its assets. In all cases, Crédit Foncier holds an initial claim against a primary counterparty other than the monoline. These guarantees generally cover public sector financing transactions (loans or securities) extended directly to a sovereign state or to a local authority or public institution.

These commitments are legally structured as financial guarantees (and not CDS) and constitute an additional security for the underlying asset. These guarantees are neither valued nor recognised on Crédit Foncier’s balance sheet (only the enhancement premium is recognised as an expense when the guarantee is extended outside of the underlying security or loan).


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The breakdown of this monoline-insured portfolio is based on the nominal value of the investment lines at June 30, 2013, according to the initial credit enhancer (without taking into

account takeovers of certain companies by rival monolines which have since taken place).

(in €m)

ENHANCED ASSETS

06/30/2013Gross notional

amount of enhancements

Gross notional amount

of hedged instruments

Fair value of hedged

instruments

Fair value of enhancements

before adjustments

Fair value of hedges

purchased

Fair value of enhancements net of hedges

and before adjustments

Fair value adjustments for monoline

credit risk (recognised

on the enhancement)

Residual exposure to

counterparty risk from

monolines

Enhancements acquired from monolines

On CDOs (US residential market) with subprime underlyings

- - - - - - - -

On CDOs (US residential market) with non-subprime underlyings

- - - - - - - -

Counterparty risk on other transactions

2,065 2,065 2,431 - - - - -

TOTAL 06/30/2013 2,065 2,065 2,431 - - - - -

TOTAL 12/31/2012 2,192 2,192 2,713 - - - - -

The breakdown of underlying assets by intrinsic rating is shown below.

7.1.2.2 - Breakdown of gross exposures by underlying rating (nominal value)

(in €m)

06/30/2013 Nominal

%Monoline Monoline rating AA A BBB Non-Investment Grade

Not Available

Total

AMBAC Not available 11 15 380 407 20%

CIFG Not available 139 139 7%

FGIC Not available 103 103 5%

AGMC A 257 807 145 1,209 58%

MBIA BBB+ 82 125 207 10%

TOTAL 257 900 299 380 228 2,065 100%

% 12% 44% 15% 18% 11%

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The monoline rating is the lower of the two best ratings from Standard & Poor’s, Moody’s and Fitch Ratings at June 30, 2013. The intrinsic rating of the underlying asset is consistent with its pre-enhancement Basel II rating at the same date.

In light of the restructuring of the monoline sector, the rating now used for securities initially enhanced by FSA is that of Assured Guaranty Municipal Corp. This monoline was rated A2 (Moody’s) and AA- (Standard & Poor’s) at June 30, 2013. Similarly, securities enhanced by MBIA are now assigned the rating of the National Public Finance Guarantee Corporation (Baa1 by Moody’s and A by Standard & Poor’s at June 30, 2013), which now guarantees North American local authorities.

Exposures whose intrinsic rating is shown as “not available” do not strictly speaking have a Basel II rating, but are subject to internal scoring by Crédit Foncier placing them in the investment grade category (≥ BBB-), mainly owing to their external ratings. These are direct commitments to North American public sector entities.

7.2 - Exposures to Commercial Mortgage-Backed Securities (CMBS)Several CMBS positions held by Crédit Foncier have been identified as being “at risk”. The gross book value of these tranches amounted to €144.1m at June 30, 2013. They are comprised of commercial real estate exposures (mainly office buildings in the Paris region). The “at risk” CMBS positions have suffered successive ratings downgrades since 2008, and some positions are now publicly rated in the speculative category. At present, no payment defaults have been recorded on the tranches held by Crédit Foncier.

These assets are the only two securitisation positions classified “at risk” by Crédit Foncier. They are carried on Crédit Foncier’s balance sheet and provisioned for 47% of their amount on average.

7.2.1 - Table of at-risk CMBS exposures

(in €m)

06/30/2013 Table of at-risk CMBS exposures

Portfolio type United States Other markets at risk

(a)Gross exposure (gross value on the balance sheet before losses/impairments)Residual balance sheet value

- 144

(b)Accumulated losses and impairments recognised through profit or loss (since outset)o/w losses and impairments for this year onlyHaircuts recognised through profit or loss

-(68)

o/w (0) in the first half of 2013

(c)Accumulated changes in value recognised in equity (since outset)o/w changes in value for this year onlyHaircuts recognised in equity (OCI)

- -

(b + c) / a% of total CMBS haircuts(accumulated losses and impairments recognised through P&L/gross exposure)

- 47%

(d)Fair value of hedgesExternal hedges not included in the calculation of losses and impairments

- -

(a - b - c - d) Net exposure (net of losses and impairments) - 76


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7.2.2 - Breakdown of CMBS by sector

Having refocused its business, the Crédit Foncier Group has been running off its CMBS portfolio since 2011. With a total of €267m at June 30, 2013, exposures to CMBS remain modest in terms of Crédit Foncier’s securitisation portfolio (they only account for 1.9% of total exposures).

Exposures considered “at risk” (see 7.2.1) were stable against December 31, 2012, at 54% of the CMBS portfolio.

Breakdown of CMBS by sector

June 30, 2013

At risk(based onWatch List)54%

€267mNot at risk 46%

December 31, 2012

At risk(based onWatch List)52%

€278mNot at risk48%


7.2.3 - Geographic breakdown of CMBS

Crédit Foncier’s entire CMBS portfolio is located in Europe and thus contains no exposure to the United States or Asia. The “Europe” category contains pan-European CMBS (whose underlying assets are divided between several European countries).

Breakdown of CMBS by location

June 30, 2013

Europe28%

€267m

United Kingdom16%

France44%

Italy7%

Germany5%

December 31, 2012

Europe28%€278m

United Kingdom18%

France42%

Italy7%

Germany5%


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7.2.4 - Breakdown of CMBS by rating

The entire portfolio is rated by one or more rating agencies. A number of downgrades were made in the first half of the year and the ratings migrated from category A to category BBB. Outstandings in Step 1 (≥AA-) category were stable, accounting for 21% of the portfolio.

Breakdown of CMBS by rating

June 30, 2013

AA11%

A18%

€267m

≤B40%

BBB21%

AAA10%

December 31, 2012

AA11%

€278m

≤B39%

BBB7%

A32%

AAA11%


7.3 - Other subprime and Alt-A exposures (RMBS, loans, etc.)The Crédit Foncier Group has no direct or indirect exposure to subprime or Alt-A assets. Crédit Foncier has no exposure to the U.S. mortgage market more generally.

Excluding the “at-risk” assets described in section 7.2, which are subject to individual provisioning, the Crédit Foncier Group had no CMBS on the securitisation Watch List at June 30, 2013.

7.4 - Special Purpose Entities (SPEs)At June 30, 2013, the Crédit Foncier Group had no exposure to SPEs (ABCP or other).

7.5 - Leveraged buyouts (LBOs)

7.5.1 - Exposure to leveraged buyouts (LBOs)

At June 30, 2013, the Crédit Foncier Group identified seven leveraged buyout deals amounting to €127m, up 0.4%. This slight increase was only due to the implementation of an additional treasury loan on a leveraged buyout deal in the portfolio, which was paid off in July 2013.On other LBO transactions, outstandings declined by 3% due to repayments made during the period.

(in €m)

06/30/2013 12/31/2012

FINAL SHARES

Number of deals 7 7

Commitments 127 126

SHARES FOR SALE

Number of deals

Commitments

TOTAL 127 126

Definition of an LBO:• a structured credit transaction with a leverage effect, i.e.

bank borrowings, set up for the buyer of a target company;• with or without the participation of the target’s management;• a holding company is created whose capital is wholly or

partly owned by one or more financial sponsors.

The presence of a financial sponsor and a holding company is what qualifies this type of transaction as an LBO.

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7.5.2 - Change in exposures to leveraged buyouts (LBO)

(in €m)

LBO EXPOSURES 06/30/2013 12/31/2012

Total (gross) 127 126

Provisions (45) (27)

Total (net of provisions) 81 99

o/w final shares 81 99

o/w shares for sale - -

Crédit Foncier’s LBO exposures declined slightly from €99m to €81m (net of provisions).

7.5.3 - Breakdown of LBO final shares by sector and region

The real estate sector accounts for 43% of the LBO transactions financed by Crédit Foncier.

All the target companies acquired through leveraged buyout deals are based in France.

7.6 - Securitisation glossaryFor further information, please refer to page 140 of the 2012 Registration Document.

8 - Market risksAll transactions carried out in the first half are compartmentalised according to their management strategy when they are implemented, in accordance with the Crédit Foncier Group’s Financial Charter.During the period no proprietary trading transactions were carried out (defined as short-term transactions made to take advantage of price fluctuations), and the proprietary trading compartment was empty at June 30, 2013.

As its business is primarily of a commercial nature, the Group is not fundamentally exposed to market risk.

8.1 - Market risk monitoring

8.1.1 - Operation

As explained in the Registration Document, Crédit Foncier’s market risk is mainly assessed by monitoring parametric value at risk (VaR), which BPCE calculates daily using the Scenarisk tool.

8.1.2 - Scope & measurement

VaR monitoring is applied to transactions in the following compartments/sub-compartments:• proprietary trading;• equity capital - financial investments.

This VaR monitoring is carried out by Crédit Foncier’s Risk Management Division, which is responsible for reporting transaction flows pertaining to these compartments to BPCE on a daily basis.

8.1.3 - Methods and supervision

In addition, every quarter, the Finance Division presents a breakdown of the balance sheet by compartment to the ALM Committee.In the first half of 2013, Crédit Foncier did not have any transactions in the proprietary trading or equity capital - financial investment compartments. As a result, no overruns were recorded during this period.

The control system provided for under BPCE’s market risk standards and transposed in Crédit Foncier’s Financial Charter is not applicable so long as the proprietary trading compartment is empty.

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Any development of this compartment is subject to the express and prior approval, renewed every year, of Crédit Foncier’s Chief Executive Officer, Deputy CEO and Board of Directors, as well as the approval of BPCE, which can decide to end such development if the required conditions are not met.

8.2 - Equity risk

8.2.1 - Investment approaches and procedures

Investment by Groupe BPCE entities (excluding Natixis) is regulated by a list of authorised financial products and an approval procedure for new financial products. These operational safeguards ensure that financial products are used appropriately and comply with regulations and Group risk standards.

The use of financial products by Groupe BPCE entities is validated by the New Financial Products and New Activities Committee and must comply with risk limits (market, credit risk, etc.) and the constraints set forth in the Financial Management Charter for each compartment (justification of the hedging strategy for ALM products, daily liquidity for proprietary trading assets, etc.).

In addition, specific measures for processing investment requests have been established by the Group for the following financial products:• funds of listed shares;• funds of unlisted shares (private equity/infrastructure/real

estate);• securitisation vehicles;• structured products whose structure and pay off have been

validated by the New Financial Products and New Financial Activities Committee.

For Crédit Foncier and its subsidiaries, new investments (equity investments and real estate funds) are first examined by the Investment Committee, which sends an argued opinion for approval by the Executive Management committee and the Board of Directors where appropriate, according to the amount involved. In accordance with Group rules and in keeping with established thresholds, new investments are transmitted to BPCE (Group Investment Committee).

The investment rules for real estate funds (including SIIC (7)) follow the same process.

8.2.2 - Objectives

In 2007, the Crédit Foncier Group established an investment policy for real estate investment vehicles (SIIC, OPCI (8) and closed funds) and equity investments to develop growth drivers for Crédit Foncier’s financing and related activities. At June 30, 2013, these commitments totalled €61m. With regard to long-term equity holdings, Crédit Foncier does not include this portfolio in its daily VaR monitoring.

Investment rules are adapted at least every six months, after approval by the Investment Committee, to reflect new developments in the economy. All new investments are subject to the process described above. Investments in Group and non-Group real estate funds may not exceed 5% of gross regulatory capital. There have been no new investments since 2012.

8.2.3 - Accounting techniques and valuation method


(7) SIIC: Sociétés d’investissement immobilier cotées (Listed real estate companies).(8) OPCI: Organisme de placement collectif en immobilier (collective undertakings for real estate investment).

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8.2.4 - Crédit Foncier’s exposure

At June 30, 2013, the Crédit Foncier Group’s exposure to equity risk amounted to €214m (compared to €204m at December 31, 2012) and broke down as follows:

(in €m)

At 06/30/2013Cost or historic

valueFair value or

adjusted valueNet unrealised capital

gains or lossesGross unrealised

capital gainsGross unrealised

capital losses

Financial assets at fair value through profit or loss (fair value option)

- - - - -

Available-for-sale financial assets

192 214 22 26 4

TOTAL 192 214 22 26 4

Total at 12/31/2012 191 204 12 16 4

Source: accounting data (IFRS consolidation June 30, 2013).

At June 30, 2013, total unrealised gains or losses (consolidated figures) on equity exposures in the banking portfolio amounted to €22m, booked to unrealised or deferred gains and losses.

Prudentially, this unrealised capital gain of €22m on available-for-sale financial assets, booked to equity, is deducted from core capital where it does not pertain to available-for-sale securities deducted from equity. Therefore, at June 30, 2013, 45% of this almost fully-neutralised pre-tax capital gain was recognised in Tier-2 capital, in the amount of €10m.

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9 - Asset & liability management risksFor further information, please refer to page 143 of the 2012 Registration Document.

9.1 - Organisation of ALM risk monitoringFor further information, please refer to page 143 of the 2012 Registration Document.

9.2 - Methodology for assessing liquidity, interest rate and foreign exchange risksFor further information, please refer to page 144 of the 2012 Registration Document.

9.3 - Liquidity risk monitoring

9.3.1 - Organisation of the Crédit Foncier Group’s refinancing

The majority of the Crédit Foncier Group’s resources is derived from medium- and long-term issues carried out by Compagnie de Financement Foncier, the AAA/Aaa/AAA rated société de crédit foncier and Group subsidiary.

In the first six months of 2013, the Crédit Foncier Group raised €4.9bn in new financing through issues and loans of over one year on inception, including €3bn for Compagnie de Financement Foncier and €1.9bn for Crédit Foncier (excluding existing short-term resources consolidated over the medium term, in the amount of €2bn).

The Group also has a pool of eligible liquid assets. Gross assets that were eligible for ECB funding totalled €54.8bn (nominal amount before the haircut if pledged), including €32.5bn in residential receivables in respect of the temporary ECB mechanism of February 2012.

The majority of these assets are held by Compagnie de Financement Foncier, for a gross total of €42.7bn.The Compagnie de Financement Foncier can use these eligible assets up to a net amount that can be estimated at

€17.7bn (or €16.1bn taking into account amounts already used) after the haircut and based on the ECB’s current rules, while respecting applicable regulatory constraints.

At June 30, 2013, the Crédit Foncier Group’s receivables were partially funded in the amount of €5.1bn (after a haircut on the eligible assets), including €2.7bn from the ECB.

9.3.2 - Compliance with limits

With regard to monitoring liquidity, the Crédit Foncier Group is required to observe a one-month regulatory liquidity ratio.

Groupe BPCE requires its subsidiaries to observe three limits:• a limit associated with the assets/liabilities ratio (observed

over a 10-year horizon in annual steps);• the overnight (borrower) limit of €2bn must be continuously

covered by a similar outstanding (net value after haircut) deposited in a 3G pool and not used;

• a three-month rolling limit (with new flows) and a two-month liquidity limit under stress tests (observation limit), which must be observed under various standardised scenarios with regard to sources and uses of funding.

9.3.2.1 - Regulatory 1-month liquidity ratio

At June 30, 2013, Crédit Foncier’s liquidity ratio (on an individual basis) was 133%.

Compagnie de Financement Foncier’s liquidity ratio was 1,468%. It must also have a one-year cash surplus available at all times.

9.3.2.2 - Limit associated with the assets/liabilities ratio

The static liquidity gap limits are as follows:• 0-3 years: 85%• 3-6 years: 70%• 6-10 years: 55%

Furthermore, in order to ensure a forward-looking approach to liquidity management, the Risk Committee has established an approved reference level based on the observation ratio for static liquidity, as follows:• 0-3 years: 90%• 3-6 years: 75%• 6-10 years: 60%

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Assets/liabilities ratio at the end of June 2013

50%

55%

60%

65%

70%

75%

80%

85%

90%

95%

100%

105%

110%

115%

120%

Limit

Ratio at 06/30/2013

Reference level set by the Groupe BPCERisk Committee on 02/02/2011

06/1

3 12

/13

06/1

4 12

/14

06/1

5 12

/15

06/1

6 12

/16

06/1

7 12

/17

06/1

8 12

/18

06/1

9 12

/19

06/2

0 12

/20

06/2

1 12

/21

06/2

2 12

/22

06/2

3

9.3.2.3 - The overnight borrower limit

Over the period, Crédit Foncier had neither systematic nor occasional recourse to very short-term refinancing (overnight - weekly), which is subject to a defined limit by BPCE; no observations are called for, since Crédit Foncier is in compliance with this limit.

9.3.2.4 - Rolling limit

A three-month rolling limit for Crédit Foncier from an “individual” viewpoint is followed, as well as an observation limit for static liquidity stressed over a two-month period. This limit is submitted to the ALM Committee.

9.3.2.5 - Liquidity stress tests

In accordance with the provisions of Groupe BPCE’s ALM standards, liquidity stress tests are performed using BPCE

standards and in accordance with internal scenarios. This limit is submitted to the ALM Committee.

9.3.3 - Outlook for the second half of 2013

• Continuation of the working groups on LCR and NSFR calculation, in relation to the new regulations, and within the framework of the start of the “observation” period;

• improvement of management tools;• preparation of convergence towards Groupe BPCE tools.

9.4 - Interest rate risk monitoringGroupe BPCE requires its subsidiaries to observe three key limits to manage interest rates:• the first aims to manage the Group’s static gap over 10 years

using a diminishing proportion of capital (assessed at the closing date, from 95% in year 1 to 50% in year 10);

• the Net Present Value (NPV) of capital (standard Basel II indicator);

• the sensitivity of net interest margin to short- and long-term interest rate fluctuations under four scenarios communicated quarterly by the central institution.

9.4.1 - Compliance with limits

9.4.1.1 - Static gap limit

Crédit Foncier monitors the static gap using the fixed-rate gap method.

The limit presented corresponds to BPCE’s limit. At June 30, 2013, the Crédit Foncier Group was in compliance with this limit over the entire observation period.

Static gap limit at June 30, 2013

-6 -7

-5-4-3-2-101234

56

7

Entity limitsFixed-rate gap June 2013

06/31/20

23

06/30/20

13

12/31/20

13

06/30/20

14

12/31/20

14

06/30/20

15

12/31/20

15

06/30/20

16

12/31/20

16

06/30/20

17

12/31/20

17

06/30/20

18

12/31/20

18

06/30/20

19

12/31/20

19

06/30/20

20

12/31/20

20

06/30/20

21

12/31/20

21

06/30/20

22

12/31/20

22

AS

SETS

LI

AB

ILIT

IES

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9.4.1.2 - Net Present Value (NPV) of capital

Consumption of regulatory capital (including working capital in fixed-rate outstandings and their run-off as agreed over 20 years) for a +200 bp curve shock stood at -0.63% at June 30, 2013.

9.4.1.3 - Sensitivity of net interest margin

After applying four stress tests with various degrees of severity, the gap sensitivity divided by net interest margin should be lower than 5% in the year N+1 and 9% in N+2 (year-on-year). The interest margin sensitivity is measured using four interest rate shocks against the central scenario: 100-bp drop, 100-bp increase, flattening (+50 bp short term, -50 bp long term) and steepening (-50 bp short term, +50 bp long term).

As of June 30, 2013, the worst-case scenarios for the net interest margin were as follows over years 1 and 2:

Year 1 Year 2

NIM sensitivity limits (5%) (9%)

“Worst case” sensitivity limits -2.61% -0.8%

9.4.2 - Outlook for the second half of 2013

• Automation of indicator origination (for net interest margin and fixed interest rate gaps).

• Automated monitoring of new short-term interest rate indicators.

9.5 - Foreign exchange risk monitoringIn terms of foreign-exchange risk, the BPCE ALM standards specify that the spot foreign position by currency is limited to 5% of total balance sheet assets in the currency. This limit only applies if the outstandings in the foreign currency are above the equivalent of €1m.

In addition to the BPCE foreign-exchange limit:• the Crédit Foncier Group has established a foreign-exchange

limit with an equivalent of €8m for all currencies combined and €5m per currency.

Based on data provided by the middle office, quarterly information is sent to the ALM Committee indicating compliance with these position limits.

The limit was respected in the first half of 2013.

10 - Operational risksGroupe BPCE defines operational risk as the risk of loss resulting from an unsuitability, inadequate or faulty procedures, personnel, information systems or external events. This definition includes, in particular, accounting, legal, regulatory and tax risks, as well as risks related to the safety of persons and property and of information systems. It also includes internal and external fraud and reputation risk.

Operational risk is inherent in all of the Crédit Foncier Group’s businesses. It is analysed, managed and measured using a comprehensive mechanism based on the identification and appraisal of risks (and the creation of action plans to control them), the active management of acknowledged incidents and the monitoring of risk-predicting indicators.

BPCE’s approach to operational risk is governed by guidelines and rules of governance (Group Operational Risk Charter, publication of new standards in July 2012, definition of an Operational Risk (OR) policy to be implemented groupwide). It is relies on an Operational Risk function with appointed operational risk managers with their own network of OR officers for each business line. The approach is supervised at Group level by the Operational Risk Committee, which meets at least half-yearly to examine the effectiveness of measures used groupwide and to analyse the main current and potential risks identified within Group entities.

Changes in the first half of 2013 concerned governance and the management environment:• dissociation of Crédit Foncier’s Operational Risk Committee

and the Internal Control Committee. A BPCE representative participates in the Operational Risk Committee;

• roll-out at Crédit Foncier and its subsidiaries SOCFIM and Banco Primus of PARO, the operational risk management oversight and analysis application shared by all Groupe BPCE entities. At the same time as the roll-out, the network of business line OR officers was also updated.

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10.1 - General frameworkFor further information, please refer to page 148 of the 2012 Registration Document.

10.2 - GovernanceFor further information, please refer to page 148 of the 2012 Registration Document.

10.3 - Management environmentFor further information, please refer to page 148 of the 2012 Registration Document.

10.4 - Organisation of business continuity plans (BCP)Crédit Foncier’s business continuity measures are operational and have been tested on a yearly basis since 2008 in response to the major risks linked to the unavailability of employees, sites, information systems and market-wide risks such as flooding of the Seine or a flu pandemic.

At the beginning of 2013, the network of BCP officers and their deputies was updated following internal restructuring. The operational managers in charge of critical activities were informed of the duties and areas of responsibility of the BCP officers, the crisis management manual and the control programme for continued activities.

The control programme was revised and simplified, with the introduction of a quarterly schedule. Permanent control statements were made and a reporting process was formalised after the first two quarters of 2013. The BCP was added to Groupe BPCE’s permanent control reporting tool in the first quarter of 2013.

At the same time, the list of continued activities was brought into line with the activity directories, which have been updated following recent restructuring.Interviews were held with each BCP officer in order to update the Business Impact Analysis (BIA) of each critical activity and to simplify the reporting format.

A BCP test was carried out at Crédit Foncier’s external site on February 20, 2013 to test the relaunch of Corporate and Financing activities. This test confirmed that business was able to resume four hours later and also that the problems encountered during the 2012 drill had been resolved.

An exercise aimed at mobilising and convening all BCP officers and business line managers was performed following the evacuation of the Charenton-le-Pont building (Crédit Foncier’s head office).

10.5 - IT RisksAs part of Crédit Foncier’s medium-term business plan, a study initiated at the end of 2011 examined the possibility of pooling Crédit Foncier’s information systems with the Caisse d’Epargne platform (developed by IT-CE).

The project’s operational launch took place in October 2012, and migration is set for the end of 2015.

The migration requires functional upgrades and an enhancement of the platform so it can take on board Crédit Foncier’s specific requirements as a real estate specialist. IT-CE will upgrade the new platform in 2013 and 2014.

In the first half of 2013, IT budgets were therefore mainly allocated to this pooling programme.

Regarding IT security, besides recurrent information system security management and monitoring initiatives, the primary activities in the first half of 2013 were:• completion of the analysis of the compliance of Crédit

Foncier’s information systems with the Groupe BPCE information systems security policy;

• intrusion testing on business line and financial infrastructures;• reorganisation of Crédit Foncier Group’s CNIL data protection

register;• review of authorisations following internal restructuring;• contribution to work to improve the resilience and reporting

of the IT network;• participation in internal and groupwide projects and in the

IT pooling project.

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10.6 - Legal risksIn relation to the legal risks inherent in its activities, Crédit Foncier is governed by applicable laws and regulations in its capacity as a credit institution and investment service provider. Most of these laws and regulations are to be found in the French Monetary and Financial Code (provisions related to banking activities, and more specifically, to credit activities, provisions related to investment services and French Financial Markets Authority regulations).

Crédit Foncier strictly complies with regulations protecting the rights of individuals (professional secrecy, personal data protection) and governing the conditions related to its product distribution (banking and financial canvassing and insurance brokerage).

The legal division is part of the Corporate Secretariat and is responsible for helping manage the legal risks that Crédit Foncier is exposed to via its different businesses.

10.6.1 - Exceptional cases of litigation

Regarding the dispute over a loan included in the defeasance structure of Comptoirs des Entrepreneurs (CDE), a ruling by the highest court of appeal on May 22, 2013 partially overturned the ruling by the court of appeal of Aix-en-Provence on February 17, 2011, finding that CDE did not fail to fulfil its obligation to advise the borrower, thereby ruling out any possibility of compensating the borrower with a claim on the defeasance structure.

***

In the dispute between Crédit Foncier and a company that borrowed money to finance the construction of a hospital in Saudi Arabia, the borrower, which had appealed against the ruling of July 31, 2012 that validated the amount of the debt, also appealed against the ruling of November 15, 2012 that recognised the validity of the surety pledged to guarantee the loan.

***

Regarding the structured financing for a property in the Paris region, a safeguard proceeding expiring in July 2014 was adopted and the assignment of lease payments on the property under the Dailly Act was confirmed in two rulings by the Versailles court of appeal on February 28, 2013.

***

Certain investors and buyers of properties sold off-plan by a developer that experienced financial difficulties initiated legal proceedings to cancel the sale and loan, while others have now decided to invoke the responsibility of the different players involved in the tax reduction transactions (builder, notary, legal agent, lender) to obtain a joint ruling to pay damages.

***

Regarding disputes with five local authorities holding structured loans, three were resolved amicably, ending legal proceedings in progress.


10.6.2 - Major contracts


10.7 - InsuranceSince January 1, 2011, Crédit Foncier has benefitted from the business insurance programmes subscribed by BPCE and covering all Group entities.

It is insured against employer liability risks. It also benefits from several types of policies covering third-party liability and property damage that may be caused by its employees in the course of their work.

It is covered against the risk of theft, computer fraud and other forms of fraud. “Banking activity losses” coverage supplements this, although the company’s computer data is backed up, its management units are spread across several sites and it has an operational business continuity plan.

Crédit Foncier also holds a comprehensive professional liability policy covering all its activities, including those carried out by its subsidiaries. It also has corporate officers’ and directors’ liability coverage.

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The main policies taken out for 2013 have the following features:

Corporate comprehensive property damage

insurance

• Multi-risk guarantee covering all movable property (including all IT equipment) and Crédit Foncier’s immovable property for such events as fire, theft, water damage and other damages, etc.

• Consequences of damage to property.• Financial consequences of company liability.• Coverage for consequential losses of banking activity.Maximum coverage is set at €250,000,000 per year, with sub-limits for large property claims.

Fraud and valuables insurance

• Coverage of financial losses incurred by the company due to fraud or malicious acts, including computer fraud as defined by the French Criminal Code.

• Coverage of financial losses incurred by the company due to the theft, deterioration or destruction of valuables.• Coverage for consequential losses of banking activity.Total aggregate coverage amount is €40,000,000 per loss per year, increased to €105,000,000 with combined excess coverage that is shared with the professional liability policy.

Non-material IT damage

• Coverage for non-material damage: human error, failure or technical disturbance, malicious acts and computer viruses, etc.

• Coverage for consequential losses of banking activity.The contractual limit for losses resulting from non-material damage to IT is set at €65,000,000 per year, with sub-limits.

Loss of guaranteesCrédit Foncier is covered against financial losses due to both partial and total property damage (e.g. fire, hail, lightening, etc.) that would make it impossible to exercise the mortgage.Maximum coverage is set at €15,000,000 per claim and per year.

Employee protection insurance

Collective coverage of death, work incapacity and disability risks through a supplementary collective social security scheme, participation in which is mandatory for all company employees.Coverage amount (capital or annuity) is set as a percentage of gross annual salary.

Operational civil liability• Coverage for the financial consequences of civil liability claims against the company or its staff for bodily injury,

property damage and consequential losses caused to third parties.Maximum coverage is set at €75,000,000 per claim and per year (all damages combined), with sub-limits.

Professional civil liability

• Coverage for the financial consequences resulting from any claim made by a third party against Crédit Foncier and its civil liability for genuine or assumed professional misconduct committed in the performance of its activities. This guarantee covers the following risks in particular: (i) activities involving real estate loans and banking operations (Individual and Corporate), (ii) financial transactions, (iii) real estate activities, (iv) international activities, (v) third party management.

• Total coverage amounts to €40,000,000 per loss per year, increased to €105,000,000 with the combined excess coverage that is shared with coverage for fraud and valuables insurance.

Civil liability for regulated activities

Regulated activities (i.e. financial intermediation, insurance brokerage, real estate transactions/management) are covered by a separate policy in the amount of €10,000,000 per year. Should this coverage be completely used, the excess coverage provided by the professional civil liability policy can be used.

Directors’ and Corporate Officers’ civil liability

• Coverage for the financial consequences of the civil liability of the Directors and Corporate Officers arising from professional misconduct committed in their capacity as insured parties of Crédit Foncier, its subsidiaries or external entities.

• Maximum coverage is €200,000,000 per loss and per year, with sub-limits.

2 RISK MANAGEMENT

– 68 –


11 - Intermediation risk11.1 - Trading on behalf of third partiesFor further information, please refer to page 154 of the 2012 Registration Document.

11.2 - Proprietary tradingFor further information, please refer to page 154 of the 2012 Registration Document.

12 - Settlement riskFor further information, please refer to page 154 of the 2012 Registration Document.

13 - Non-compliance riskNon-compliance risks are monitored by the Compliance Division, which has two separate units: Compliance as well as Ethics and Financial Security.

In the first half of 2013 the Compliance Division focused on:• reinforcing the control set-up for advertising material and

business challenges. As part of its regulatory monitoring, the Compliance Division also continued to follow major regulatory developments, in particular the reform of the status of intermediaries in banking transactions and payment services, applicable in 2013, and the US FATCA tax regulation;

• supporting the implementation of the European Market Infrastructure Regulation (EMIR);

• a campaign to raise awareness of money laundering risks among all staff, in line with the two-year cycle;

• organising cross-business meetings between business lines and support functions to monitor decisions made by the Products and Services Approval Committee.

The procedure applied to the identification of essential outsourced services as per article 37 of amended regulation 97-02 of the Committee on Banking and Financial Regulation (CRBF) was unchanged following its update in 2012. This procedure complies with the standards laid out by BPCE.


14 - Crédit Foncier’s Caisse de Retraite (French pension fund) for employees who entered employment before March 1, 2000For further information, please refer to page 157 of the 2012 Registration Document.

2 RISK MANAGEMENT


– 69 –


ANALYSIS OF RESULTS 70

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AT JUNE 30, 2013 74

STATUTORY AUDITORS’ REPORT ON FINANCIAL INFORMATION FOR THE FIRST HALF OF 2013 112

– 70 –

3 FINANCIAL INFORMATION / ANALYSIS OF RESULTS


Analysis of resultsConsolidated resultsGroup share of net income in H1 2013 totalled €10m.

Crédit Foncier’s main consolidated financial indicators at June 30, 2013 were as follows:Loan production: €4.6bnOutstanding loans (end of period): €111.2bnNet banking income: €330mGroup share of net income: €10m

Total assets: €148.4bnConsolidated equity (group share): €3.7bnConsolidated European capital adequacy ratio: 10.2%of which Tier One: 9.6%

(in €m)

H1 2013 H1 2012

Net banking income (NBI) 330 330

Management expenses -265 -273

Gross operating income (GOI) 65 57

Cost of risk -65 -57

Income from holdings consolidated by the equity method 1 5

Income before tax (IBT) 1 5

Income tax 10 -1

Minority interests -1 -1


C/I ratio * 80.3% 82.7%

* C/I ratio (operating expenses/NBI).

In line with its strategic plan (2012-2016), Crédit Foncier initiated balance sheet reduction initiatives in Q4 2011. Under this plan, securities were sold for nearly €2.3bn and liabilities redeemed for close to €565m in 2013, generating a net capital loss of €29.4m before taxes at June 30, 2013.

Net banking income amounted to €330m in H1 2013 (as it did in H1 2012). Corrected for the net impact of asset disposals and liability redemptions carried out in the first half of the year, net banking income rose by 9% compared to the first half of 2012.

Operating expenses decreased slightly to €265m, down by 3% versus H1 2012. Cost-cutting is a big factor in the success of the strategic plan.

Gross operating income came to €65m.

Cost of risk resulted in a net provision of €65m in the first half of the year. This figure includes provisions for certain corporate disputes and for individual customers that have been downgraded to doubtful.

Net income was positive at €10m in the first half of 2013.

At June 30, 2013, risk-weighted assets were down 2% compared to June 30, 2013. Capital was solid at €4.5bn at the end of the first half, giving a Tier One ratio of 9.6%.

– 71 –



Simplified consolidated balance sheet

(in €m)

ASSETS 06/30/2013 12/31/2012

Cash and amounts due from central banks 19 3,705

Financial assets at fair value through profit or loss 2,914 3,438

Hedging derivatives 7,524 10,317

Available-for-sale financial assets 3,705 3,693

Loans and receivables due from credit institutions 17,057 18,578

Loans and receivables due from customers 105,292 108,741

Remeasurement adjustment on interest rate risk-hedged portfolio 4,758 6,310


Current tax assets 110 321

Deferred tax assets 724 728

Accrued income and other assets 5,943 7,103

Investments in companies accounted for by the equity method 56 55

Investment property 40 41

Property, plant and equipment 111 115

Intangible assets 9 10

Goodwill 13 13

TOTAL 148,411 163,303

(in €m)

EQUITY AND LIABILITIES 06/30/2013 12/31/2012

Financial liabilities at fair value through profit or loss 5,015 5,562


Due to credit institutions 38,708 36,656

Due to customers 375 271

Debt securities 85,445 97,545

Remeasurement adjustment on interest rate risk-hedged portfolio 49

Current tax liabilities 1 31

Deferred tax liabilities 1 2

Accrued expenses and other liabilities 5,348 7,319

Provisions 232 238

Subordinated debt 810 803

Group share of consolidated equity 3,656 3,586

o/w net income for the period 10 7


TOTAL 148,411 163,303

– 72 –



The IFRS consolidated balance sheet total at June 30, 2013 amounted to €148.4bn, representing a decrease of 9% compared to December 31, 2012.

Working cash balances, placed with Banque de France, amounted to €3.7bn.

Loans and receivables due from credit institutions decreased by €1.5bn following the €3bn reduction in the loan to BPCE, which fell to €10bn at 30 June 2013. This was partially offset by a €1.6bn increase in current accounts with overdrafts.

Loans and receivables due from customers fell by €3.4bn, or 3.17%, due in large part to a €3.7bn reduction in securities classified as loans and receivables.

Amounts due to credit institutions rose by €2bn following the expansion of the BPCE funding operation.

Debt securities declined by €12.1bn. This is primarily the result of an €8.9bn decrease in bonds and accrued interest, and a €3.2bn decline in medium-term notes (MTNs) and certificates of deposit.

The group share of consolidated equity increased by €0.1bn, largely because of the decrease in unrealised capital losses net of deferred interest on AFS securities (9).

OutlookCrédit Foncier is unaware of any deterioration affecting the Group’s outlook since the date of its last financial statements.

(9) AFS: Available for sale.


– 73 –






– 74 –

3 FINANCIAL INFORMATION / CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AT JUNE 30, 2013

Prepared using IFRS

1 - CONSOLIDATED BALANCE SHEET - ASSETS 762 - CONSOLIDATED BALANCE SHEET - LIABILITIES 773 - CONSOLIDATED INCOME STATEMENT 784 - STATEMENT OF NET INCOME AND GAINS OR LOSSES POSTED TO EQUITY 795 - STATEMENT OF CHANGES IN EQUITY 806 - CASH FLOW STATEMENT (INDIRECT METHOD) 81

NOTE 1 - Legal and financial framework - Significant events during the period and events subsequent to June 30, 2013 83

1.1 - Legal framework 831.2 - Guarantee system 831.3 - Significant events during the first half of 2013 831.4 - Post-balance sheet events 84

Note 2 - Accounting principles and comparability 85

2.1 - Regulatory framework 852.2 - Accounting standards 852.3 - First application of the amendments to IAS 19 862.4 - Use of estimates 862.5 - Presentation of the consolidated financial statements and balance sheet date 87

Note 3 - Operating segments 88

3.1 - Income statement 893.2 - Balance sheet 89

Note 4 - Notes to the balance sheet 90

4.1 - Financial assets and liabilities at fair value through profit or loss 904.2 - Available-for-sale financial assets 914.3 - Fair-value hierarchy of financial assets and liabilities 924.4 - Loans and receivables 964.5 - Reclassification of financial assets 984.6 - Held-to-maturity financial assets 994.7 - Goodwill 994.8 - Due to credit institutions 1004.9 - Debt securities 1004.10 - Provisions 1014.11 - Subordinated debt 102

– 75 –



Note 5 - Notes to the income statement 103

5.1 - Interest income and expense 1035.2 - Fee and commission income and expense 1035.3 - Net gains or losses on financial instruments at fair value through profit or loss 1045.4 - Net gains or losses on available-for-sale financial assets 1045.5 - Income and expense on other activities 1055.6 - Operating expenses 1055.7 - Credit risk 1055.8 - Income tax 107

Note 6 - Financing and guarantee commitments and commitments on securities 109

6.1 - Financing commitments 1096.2 - Guarantee commitments 1096.3 - Commitments on securities 1096.4 - Financial assets pledged as collateral 109

Note 7 - Scope of consolidation at June 30, 2013 110

– 76 –



1 - Consolidated balance sheet - Assets(in €m)

Notes 06/30/2013 12/31/2012

Cash and amounts due from central banks 19 3,705

Financial assets at fair value through profit or loss 4.1.1 2,914 3,438


Available-for-sale financial assets 4.2 3,705 3,693

Loans and receivables due from credit institutions 4.4.1 17,057 18,578

Loans and receivables due from customers 4.4.2 105,292 108,741

Remeasurement adjustment on interest rate risk-hedged portfolio 4,758 6,310

Held-to-maturity financial assets 4.6 136 135

Current tax assets 110 321

Deferred tax assets 724 728

Accrued income and other assets 5,943 7,103

Investments in associates 56 55

Investment property 40 41

Property, plant and equipment 111 115

Intangible assets 9 10

Goodwill 4.7 13 13

TOTAL ASSETS 148,411 163,303

2012 information has not been restated to reflect the impact of the amendments to IAS 19. The effects of applying the revised standard are explained in Note 2.3.

– 77 –



2 - Consolidated balance sheet - Liabilities(in €m)

Notes 06/30/2013 12/31/2012

Financial liabilities at fair value through profit or loss 4.1.2 5,015 5,562


Due to credit institutions 4.8 38,708 36,656

Due to customers 375 271

Debt securities 4.9 85,445 97,545

Revaluation adjustment on interest rate risk-hedged portfolio 49

Current tax liabilities 1 31

Deferred tax liabilities 1 2

Accrued expenses and other liabilities 5,348 7,319

Technical reserves of insurance companies 49 41

Provisions 4.10 183 197

Subordinated debt 4.11 810 803

Equity 3,754 3,683

• Group share of consolidated equity 3,656 3,586

Share capital and additional paid-in capital 1,732 1,731

Retained earnings 2,260 2,267

Gains and losses recognised directly in equity -346 -419

Net income for the period 10 7

• Minority interests 98 97

TOTAL LIABILITIES AND EQUITY 148,411 163,303


– 78 –



3 - Consolidated income statement(in €m)

Notes H1 2013 H1 2012

Interest and similar income 5.1 3,055 4,448

Interest and similar expenses 5.1 -2,836 -4,030

Fee and commission income 5.2 108 86

Fee and commission expenses 5.2 -9 -6

Net gains or losses on financial instruments at fair value through profit or loss 5.3 3 -2

Net gains or losses on available-for-sale financial assets 5.4 -18 -174

Income from other activities 5.5 63 62

Expenses from other activities 5.5 -36 -32

NET BANKING INCOME 330 330

Operating expenses 5.6 -258 -264

Depreciation, amortisation and impairment of property, plant & equipment and intangible assets

-7 -9

GROSS OPERATING INCOME 65 57

Cost of risk - Individual and Corporate Customers 5.7 -65 -53

Cost of risk - Sovereigns 5.7 -4

OPERATING INCOME

Share in net income of associates 1 1

Gains or losses on other assets 4

INCOME BEFORE TAX 1 5

Income tax 5.8 10 -1

NET INCOME 11 4




– 79 –



4 - Statement of net income and gains and losses posted to equity

(in €m)

H1 2013 H1 2012

NET INCOME 11 4

Revaluation differences on defined-benefit plans 3

Tax impact of revaluation differences on defined-benefit plans -1

ITEMS THAT CANNOT BE RECLASSIFIED FROM EQUITY TO INCOME 2

Change in value of available-for-sale financial assets 107 72

Change in value of hedging derivatives

Tax impact -36 -21

ITEMS THAT CAN BE RECLASSIFIED FROM EQUITY TO INCOME 71 51

GAINS AND LOSSES RECOGNISED DIRECTLY IN EQUITY (AFTER TAX) 73 51

NET INCOME AND GAINS AND LOSSES RECOGNISED DIRECTLY IN EQUITY 84 55

Group share 82 54



– 80 –



5 - Statement of changes in equity

(in €

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Othe

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103,

656

983,

754

– 81 –



6 - Cash flow statement (indirect method)The consolidated cash flow statement is presented in accordance with the indirect method.Investing activities represent cash flows relating to the acquisition and sale of interests in consolidated companies, held-to-maturity financial assets, property, plant and equipment and intangible assets.Financing activities include financial transactions involving equity, subordinated debt and bonds.

Operating activities include activities that do not fall into the other two categories, and mainly comprise strategic equity investments recognised under “Available-for-sale financial assets”.The cash and cash equivalents line item comprises cash on hand, amounts due from and to central banks, demand accounts and deposits with credit institutions.

(in €m)

H1 2013 H1 2012

Income before tax 1 5

+/- Net depreciation and amortisation of property, plant and equipment and intangible assets 7 9

+/- Goodwill impairment

+/- Net charge to provisions and provisions for impairment 54 118

+/- Share in net income of associates -1 -1

+/- Net cash flows generated by investing activities -17 145

+/- Income/expense from financing activities 16 17

+/- Other changes 1,726 682

= Total non-monetary items included in net income before tax 1,785 970

+/- Net increase or decrease arising from transactions with credit institutions 4,983 715

+/- Net increase or decrease arising from transactions with customers 3,278 2,823

+/- Net increase or decrease arising from transactions involving financial assets or liabilities -11,406 -3,594

+/- Net increase or decrease arising from transactions involving non-financial assets or liabilities -909 -391

- Taxes paid 157 410

= Net increase or decrease in assets and liabilities from operating activities -3,897 -37

Net cash flows generated by operating activities (A) -2,112 938

+/- Net increase or decrease related to financial assets and equity investments 4 -134

+/- Net increase or decrease related to investment property 4 1

+/- Net increase or decrease related to property, plant and equipment, and intangible assets -3 -3

Net cash flows generated by investing activities (B) 5 -136

+/- Net increase or decrease in cash and cash equivalents from transactions with shareholders 7

+/- Net increase or decrease in cash and cash equivalents from financing activities -1 -21

Net cash flows generated by financing activities (C) -1 -14

Impact of changes in exchange rates (D)

TOTAL NET CASH FLOWS (A+B+C+D) -2,108 788

– 82 –



H1 2013 H1 2012

Opening cash balance 4,209 1,600

Cash on hand and net balances with central banks 3,706 15

Net demand deposits with credit institutions 503 1,585

Closing cash balance 2,101 2,388

Cash on hand and net balances with central banks 19 19

Net demand deposits with credit institutions 2,082 2,369

NET INCREASE OR DECREASE IN CASH AND CASH EQUIVALENTS -2,108 788

– 83 –



Note 1 - Legal and financial framework - Significant events during the period and events subsequent to June 30, 2013

Note 1.1 - Legal framework

Crédit Foncier, a subsidiary of BPCE, specialises in real estate and public sector financing. It operates on the individual customer segment (real estate financing, appraisals and services), the private corporate and public segments.

Note 1.2 - Guarantee system

Crédit Foncier is a direct subsidiary of BPCE. As such, it is covered by its parent company guarantee and the Groupe BPCE guarantee and liquidity mechanism. As a direct subsidiary, Crédit Foncier does not contribute to the network solidarity mechanism and will not be called upon in the event of a Banque Populaire or Caisse d’Epargne default.

Note 1.3 - Significant events during the first half of 2013

Note 1.3.1 - Reinforcing the Group’s existing structures

Locindus

Crédit Foncier exercised its option to receive its Locindus dividends in shares. As a result, on June 27, 2013, Crédit Foncier received 602,433 Locindus shares with a value of €7m, raising its stake from 74.15% to 74.49%.

Banco Primus

On April 17, 2013, Crédit Foncier signed a settlement agreement to purchase the remaining 4,500,000 shares for a total cost of €15m. Crédit Foncier’s percentage holding in Banco Primus rose from 95.45% to 100%. The impact of this transaction was recognised under equity as a €12m expense. The €11m risk provision for this item has been fully reversed.

Crédit Foncier Immobilier (CFI)

On June 28, 2013, Crédit Foncier purchased the HAO’s non-controlling interest, representing 25.07% of CFI’s share capital, at a cost of €10m, plus an additional consideration of €2m. Following this transaction, Crédit Foncier holds 100% of CFI. The impact of this transaction was recognised under equity as a €2m liability.

Note 1.3.2 - Impairment of cash-generating units (CGUs)

As there was no evidence of impairment in the first half of 2013, the Group did not record any additional impairment losses.

Note 1.3.3 - Valuation of issuer spreads

Credit spreads on structured issues were stable over the period. Amortising the valuation adjustment had an impact of -€12m for H1 2013.

Note 1.3.4 - Change in cost of risk

H1 2013 recorded a negative cost of risk of -€65m versus €53m in the first half of 2012.These figures are explained in Paragraph 4.1.5 of the Risk Management Report.

Note 1.3.5 - International exposures

Under its new strategic plan, and due to the strengthening of prudential rules in respect of the implementation of the European CRD3 Directive at December 31, 2011 and in anticipation of the entry into force of Basel III (EU directive 2013/36 of June 26, 2013, known as CRD4, and the European CRR regulation, which was passed by the European Parliament on April 16, 2013, introducing a leverage ratio requirement), the Crédit Foncier Group continued to reduce its international exposures by halting new investments in the sector as well as selling off several lines of securities, and, where applicable, redeeming previously issued covered bonds.

The sale and early redemption of assets involved a sum of €2,280m in the first half of 2013. They mainly comprised IPF securities and units in securitisation mutual funds.

These transactions, coupled with the termination of the associated hedging swaps, generated net capital losses of -€42m, booked to gains or losses on available-for-sale financial assets.

At the same time, the Group continued the redemption of a portion of Compagnie de Financement Foncier bonds issued on the market and cancelled €565m of them in the first half of 2013.

– 84 –



The impact of these redemptions on the income statement was a gain of €12m, recorded under gains or losses on available-for-sale financial assets.

These gains had previously been recorded under net interest margin. The impact of this change in presentation is as follows:

(in €m)

Notes H1 2013 H1 2012 - pro forma

H1 2012 - published

Interest and similar income 5.1 3,055 4,324 4,448

Interest and similar expense 5.1 -2,836 -4,030 -4,030

Fee and commission income 5.2 108 86 86

Fee and commission expense 5.2 -9 -6 -6

Net gains or losses on financial instruments at fair value through profit or loss 5.3 3 -24 -24

Net gains or losses on available-for-sale financial assets 5.4 -18 -50 -174

Income from other activities 5.5 63 62 62

Expenses from other activities 5.5 -36 -32 -32

NET BANKING INCOME 330 330 330

Note 1.3.6 - Reclassification of financial assets

The Group carried out no reclassification of financial assets in the first half of 2013.

Note 1.3.7 - Sovereign risk for some EU countries

Several eurozone countries are facing economic difficulties and a crisis of confidence regarding their debt. Against this backdrop, in collaboration with the International Monetary Fund, the European Union drew up stimulus plans for Greece (May 2010, July and October 2011, with final terms drawn up in February and November 2012), Ireland (November 2010), Portugal (May 2011) and Cyprus (May 2013).

In the first half of 2013, Group exposures to sovereign risk in these countries changed as follows:

(in €m)

06/30/2013 12/31/2012

Cyprus 57 60

Total loans and receivables 57 60

Ireland 149 144

Total available-for-sale financial assets 149 144

Total 206 204

The maturities for all net exposures as at June 30, 2013, are presented below:

(in €m)

<1 year

2 years 3 years3 to 5 years

5 to 10 years

>10 years

Total

Cyprus 1 56 57

Ireland 2 147 149

Total 3 56 147 206

The Group’s sovereign risk exposure in other countries is covered in the half-year risk management report.

Note 1.3.8 - Off-balance sheet restructuring

In the interest of meeting the twofold objective of reducing the size of Crédit Foncier Group’s off-balance sheet commitments, in order to minimise the level of capital allocated to derivatives and limit counterparty exposures, the Group carried out several interest rate derivative restructuring transactions.

Macro-hedging swaps with a notional amount of €933m were cancelled. The Group thus received a net termination balance of €35m.

The adjustment to the value of the hedged component, as well as the unamortised balance at June 30, 2013 of the initial termination payments, were spread out and reported on the income statement under “Interest and similar income” or “Interest and similar expenses”.

Note 1.4 - Post-balance sheet events

No other event that is likely to have a significant impact on the financial statements at June 30, 2013, had occurred between the closing date and July 30, 2013, the date of the Board of Directors’ meeting that examined the interim financial statements.

– 85 –



Note 2 - Applicable accounting standards and comparability

Note 2.1 - Legal framework

Pursuant to EU regulation 1606/2002 of July 19, 2002 relating to the application of international accounting standards, the Crédit Foncier Group has prepared its financial statements for the first half of 2013 in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and applicable at that date, excluding certain provisions of IAS 39 regarding hedge accounting (10).The condensed interim consolidated financial statements at June 30, 2013 have been drawn up in accordance with IAS 34 on “Interim financial reporting”. As such, the notes presented apply to the most significant items from the period and should be read in conjunction with the Group’s full-year consolidated financial statements at December 31, 2012.

Note 2.2 - Accounting standards

The accounting standards and principles are identical to those used and described in the financial statements at December 31, 2012. They have also been supplemented by the standards, amendments and interpretations that must be applied to fiscal years beginning on January 1, 2013, except for the amendment to IFRS 7 “Disclosures: offsetting financial assets and financial liabilities”. This amendment requires information on financial assets and liabilities governed by a legally enforceable master netting agreement or similar agreement be published in appendices.

This information must make it possible to understand the impact of netting agreements on the Group’s balance sheet. This amendment will result in the publication of supplementary information in the Group’s consolidated financial statements as at December 31, 2013.

The new standards applied as of January 1, 2013 include the following:• IFRS 13 “Fair value measurement” adopted by the European

Commission on December 11, 2012, with mandatory application to financial years beginning on or after January 1, 2013.IFRS 13 explains how to measure fair value but does not change the conditions for applying fair value. This standard is for prospective application.For the Group, this standard primarily affects the way non-performance risk is taken into account when assessing the value of derivative financial liabilities (Debit Valuation Adjustment - DVA).

Furthermore, the clarifications provided by IFRS 13 have led the Group to change the way it measures the value of price adjustments for counterparty risk (Credit Valuation Adjustment - CVA) for counterparties in certain segments.These changes did not have any material impact for the group.IFRS 13 also requires additional information to be presented in the notes to the financial statements. Some of this information is also required for interim financial statements (IAS 34.16A (j)), and is presented in Note 2.4.

• the amended version of IAS 19 “Employee benefits”, with mandatory retrospective application to financial years beginning on or after January 1, 2012.It modifies the method of recognising defined-benefit pension plans as follows:- all actuarial gains and losses must be recognised as

items in “Other comprehensive income” that may not be reclassified as income,

- changes to plans must be recognised immediately in profit or loss,

- yield on plan assets must be measured with the same rate used for discounting liabilities.

On first implementing this standard (January 1, 2013), the Group recognised:- the amount of unrecognised revaluation differences at

January 1, 2012, with a corresponding entry in “Other comprehensive income”,

- the amount of unrecognised past service costs at January 1, 2012 with a corresponding entry in “Retained earnings”,

- the difference made by this standard on 2012 results (with a corresponding entry in “Retained earnings”), comprising the following three items:• actuarial gains and losses recognised over 2012 booked

according to IAS 19,• plan changes recognised over 2012 booked according

to IAS 19, • the difference in rates for plan asset yields booked for

2012,- the change to the provision under “Other comprehensive

income” according to the amended version of IAS 19 for 2012, which corresponds to revaluation differences produced in 2012.

Due to the significant impact of applying this standard for the first time, comparative financial information has not been restated. The impact of the first implementation of the amendments to IAS 19 on the consolidated financial statements is also discussed in Paragraph 2.3.

• the amendment to IAS 1 “Presentation of Financial Statements” aims to expand the financial disclosures

(10) These standards are available on the European Commission’s website: http://ec.europa.eu/internal_market/accounting/ias/index_en.htm.

– 86 –



included in the statement of net income and gains and losses recognised directly in equity. The presentation of gains and losses posted directly to equity must clearly distinguish between items liable to be reclassified to net income from items that will never be reclassified to net income.

The other standards, amendments and interpretations adopted by the European Union that became compulsory as of 2013 had no significant impact on the Group’s financial statements.

2.3 - First application of the amendments to IAS 19

The provision for end-of-career benefits (IFC) calculated per IAS19R was €5m at January 1, 2012 and €13m at December 31, 2012. At June 30, 2013, it totalled €13m. The impact of restating the financial statements at December 31, 2012 may be summarised as follows:

(in €m)

Impact of restatements

Debt OCIRetained earnings

Total impact posted to equity at 12/31/2012

Amount posted to liabilities per IAS 19 at 12/31/2012 15

Full recognition of actuarial spreads in OCI items that cannot be reclassified to income

Inventory at 01/01/2012

-8 8 8

Revaluation spreads generated in 2012 6 -6 -6

Amount posted to liabilities at 12/31/2012 per amended IAS 19 13 2 2

Note 2.4 - Use of estimates

The preparation of the financial statements requires, in some areas, the use of assumptions and estimates with regard to uncertain future events.Management is required to exercise judgement in making these estimates and assumptions, based on information available at the balance sheet date.Future results may differ from these estimates.

In particular for the accounts at June 30, 2013, accounting estimates that require assumptions were largely used for the following assessments:• the fair value of financial instruments assessed using

valuation techniques (see note 2.4.1 below);• the depreciation of financial assets, and in particular

individual impairments or those calculated on a collective (portfolio) basis (note 5.7);

• provisions recorded on the balance sheet under liabilities, and more particularly, provisions relating to insurance contracts;

• the assessment of expenses related to pension schemes and future employee benefits;

• deferred taxes (note 5.8);• goodwill impairment tests.

Note 2.4.1 - Determination of fair value

Fair value is defined as the amount received for the sale of an asset or paid for the transfer of a liability in an arm’s-length transaction between market participants at the valuation date.The Group assesses the fair value based on the assumptions that market players would use to set the price of an asset or liability. For derivatives, these assumptions include the evaluation of counterparty risk (CVA - Credit Valuation Adjustment) and non-performance risk (DVA - Debit Valuation Adjustment). This evaluation is based on traditional parameters.At June 30, 2013, CVA and DVA amounts were insignificant.In addition, the valuation of derivatives for which the counterparty is a member of the Groupe BPCE solidarity mechanism (see note 1.2) are not subject to CVA or DVA calculation in Group financial statements.

Fair value at the initial recognition date

For transactions signed by the Group, the transaction price (i.e., the consideration paid or received) provides the best assessment of the fair value of the transaction at the initial recognition date.

– 87 –



Fair value hierarchy

Level 1 fair value and the concept of an active marketIn the case of financial instruments, the most reliable evidence of fair value is a quoted price on an active market (“level 1 fair value”). Where such prices exist, they must be used without adjustment to assess fair value.An active market is a market on which transactions for assets or liabilities occur with sufficient frequency and volume.

Level 2 fair valueIf there are no quoted prices on an active market, fair value may be determined in accordance with generally accepted valuation methods reflecting accepted financial theories and preferring observable market valuation methods (“level 2 fair value”).“Level 2” valuations are based on observable inputs and models that are widely used by the market (discounted cash flow model, interpolation).

Level 3 fair valueIf observable market inputs are inadequate, fair value may be determined applying a valuation method based on internal models (“level 3 fair value”) using non-observable data. The model used must be periodically updated by reconciling its results with prices for recent transactions.

Transfers between fair-value levels

Information on transfers between fair-value levels may be found in Note 4.3.2. The amounts in this note are values calculated at the last valuation date prior to the transfer.

Particular cases

Fair value of financial instruments booked at amortised costFair value calculations for financial instruments that are not at fair value on the balance sheet are provided for information only and must be interpreted with caution.In fact, for most cases, the values provided are not intended to be produced and in practice they normally cannot be.

Fair values calculated in this way are provided for information only in the notes to the financial statements. These values are not the indicators used to manage commercial bank activities, for which the management model is the collection of contractual cash flows.As a result, simplified assumptions are used to assess the fair value of these instruments.

Note 2.5 - Presentation of the consolidated financial statements and balance sheet date

The IFRS imposes no model for summary financial statements, so the format used complies with that proposed by Recommendation no. 2009 R 04 of the French national accounting board, dated July 2, 2009.The consolidated financial statements are drawn up on the basis of the accounts as at June 30, 2013 of entities included within the Group’s consolidation scope. The Group’s half-year consolidated financial statements were approved by the Board of Directors on July 30, 2013.

– 88 –



Note 3 - Operating segments

Affiliated to BPCE, the Crédit Foncier Group is the largest specialised real estate financing institution in France, providing customised financing solutions and real estate services to individuals and corporates as part of an overall asset management approach. It also provides financing for the public sector, both in France and abroad.

Pursuant to IFRS 8 and given the considerable size of Crédit Foncier’s business lines, the Group’s internal organisation and management structures are based around five main business lines within the framework of the Group’s governing and decision-making bodies.

Individual Customers sector

This sector involves three different activities:• mortgage financing for first-time home buyers or rental

investment property, through both regulated and non-regulated loans, along with a range of banking services;

• real estate advisory and services for individual and corporate customers;

• value-enhancement of Crédit Foncier property assets through rentals and the sale of buildings.

Private corporate sector

This sector has access to a full range of financing products and solutions designed for real estate professionals (developers, investors, corporations and public-private partnerships):• long-term or short-term financing via traditional or structured

loans;• real estate leasing;• guarantees and other off-balance sheet commitments and

related banking services (deposit and investment activity).

Public sector

In this sector, Crédit Foncier provides financing to French local authorities and social housing organisations (HLM and semi-public corporations).

International corporate sector

In this sector, Crédit Foncier provides international financing services in the form of:• financing for foreign local authorities (by acquiring bonds

issued by public entities or quasi-public entities and financing for foreign local authorities in the form of loans or subscriptions to bond issues);

• acquisition of risk-free residential mortgage loans.

Holding structure

Indirect income and expenses from support activities are reallocated to the businesses.Certain items that are considered non-business line are shown separately in this division, which includes: income on redemptions of covered bonds and disposals of securities (in line with the Group’s strategy) as well as the “Share in income of associates”, “Gains and losses on other assets”, and “Change in the value of goodwill”.The income tax expense is the difference between income tax expenses paid by the business lines at a normative rate, and the total income tax expense.

– 89 –



Note 3.1 - Income statement(in €m)

IndividualsPrivate

corporate sectorPublic sector

International corporate sector

Holding H1 2013

Net banking income 277 46 22 27 -41 331

Management expenses -213 -25 -16 -11 -265

Gross operating income 64 21 6 16 -41 66

C/I ratio 76.9% 54.3% 72.7% 40.7% 80.1%

Cost of risk -45 -7 -14 -66

Share in income of associates 1 1

Income before tax 19 14 -8 16 -40 1

Current and deferred taxes -7 -5 3 -6 25 10

Minority interests -1 -1

GROUP SHARE OF NET INCOME 12 9 -5 10 -16 10

Note 3.2 - Balance sheet(in €m)

Individuals Private corporate sector Public sector International

corporate sector Holding 06/30/2013

Financial assets (1) 49,683 7,049 24,847 29,655 111,234

Other 37,177 37,177

TOTAL BALANCE SHEET ASSETS 49,683 7,049 24,847 29,655 37,177 148,411

(1) The breakdown of assets by sector is based on the distribution of commitments granted in the Risk Management report (overall exposure to credit risk, IFRS 7).

– 90 –



Note 4 - Notes to the consolidated balance sheet

Note 4.1 - Financial assets and liabilities at fair value through profit or loss

Note 4.1.1 - Financial assets at fair value through profit or loss

(in €m)

06/30/2013 12/31/2012

Trading FV option Total Trading FV option Total

Fixed-income securities

Equities and other variable-income securities

Loan book 2,281 2,281 2,718 2,718

Loans to customers 2,281 2,281 2,718 2,718

Repurchase agreements

Trading derivatives 633 633 720 720

TOTAL FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS 633 2,281 2,914 720 2,718 3,438

Financial assets designated at fair value concern structured loans granted to the regional public sector (RPS), recorded in the “accounting mismatches” category. This choice makes it possible to translate the hedging procured through the structured derivative.

Loans and receivables designated at fair value and credit risk

The item “Loans to customers” includes solely structured loans granted to French local authorities.The change in the fair value of these financial assets attributable to credit risk was -€5m at June 30, 2013, compared to -€8m at December 31, 2012.

Trading derivatives

Derivative assets and liabilities in the trading portfolio are contracted to hedge the structured transactions.

– 91 –



Note 4.1.2 - Financial liabilities at fair value through profit or loss

(in €m)

06/30/2013 12/31/2012

Financial liabilities held for trading

Trading derivatives 758 948

Financial liabilities designated at fair value through profit or loss 4,257 4,614

Interbank term accounts and loans

Customer term accounts and loans

Debt securities 4,257 4,614

TOTAL FINANCIAL LIABILITIES AT FAIR VALUE THROUGH PROFIT AND LOSS 5,015 5,562

Financial liabilities designated at fair value under the fair value option consist mainly of structured issues carried out by Compagnie de Financement Foncier.

Note 4.2 - Available-for-sale financial assets(in €m)

06/30/2013 12/31/2012

Fixed-income securities 3,459 3,456

Bonds and other fixed-income securities 3,459 3,456

Equities and other variable-income securities 231 221


Other variable-income securities 1 1

Loan book 31 32

Loans to customers 31 32

Doubtful loans and receivables 3 3

GROSS AMOUNT OF AVAILABLE-FOR-SALE FINANCIAL ASSETS 3,724 3,712

Impairment of doubtful loans and receivables -3 -2

Permanent impairment on investments in associates -16 -17

TOTAL AVAILABLE-FOR-SALE FINANCIAL ASSETS, NET 3,705 3,693

Gains and losses recognised directly in equity on available-for-sale financial assets (before tax and existing unrealised gains and losses - amendment to IAS 39) -447 -550

– 92 –



Note 4.3 - Fair-value hierarchy of financial assets and liabilities

Note 4.3.1 - Fair-value hierarchy of financial assets and liabilities

At June 30, 2013

(in €m)

Price quoted on an active

market (level 1)

Measurement techniques using observable data

(level 2)

Measurement techniques using

non-observable data (level 3)

Total

FINANCIAL ASSETS 2,225 11,834 215 14,274

Derivatives 634 634

- Of which interest-rate derivatives 551 551

- Of which foreign-exchange derivatives 83 83

Other financial assets

Financial assets held for trading 634 634

Securities

Other financial assets 2,281 2,281

Financial assets designated at fair value through profit or loss 2,281 2,281

- Of which interest-rate derivatives 5,958 5,958

- Of which foreign-exchange derivatives 1,697 1,697



Other securities

- Of which fixed-income securities 2,225 1,255 3,480

- Of which variable-income securities

Other financial assets 9 22 31

Available-for-sale financial assets 2,225 1,264 215 3,704

– 93 –



At December 31, 2012

(in €m)


market (level 1)


(level 2)



Total

FINANCIAL ASSETS 2,317 14,923 208 17,448

Derivatives 720 720

- Of which interest-rate derivatives

- Of which foreign-exchange derivatives


Financial assets held for trading 720 720

Securities

Other financial assets 2,718 2,718

Financial assets designated at fair value through profit or loss 2,718 2,718





Other securities

- Of which fixed-income securities 2,317 1,158 3,475


Other financial assets 10 23 33

Available-for-sale financial assets 2,317 1,168 208 3,693

– 94 –



At June 30, 2013

(in €m)


market (level 1)


(level 2)



Total

FINANCIAL LIABILITIES 13,868 13,868

Derivatives 757 757

- Of which interest-rate derivatives 699 699

- Of which foreign-exchange derivatives 58 58

Other financial liabilities

Financial liabilities held for trading 757 757

Securities

Other financial liabilities 4,257 4,257


- Of which interest-rate derivatives 6,617 6,617

- Of which foreign-exchange derivatives 2,237 2,237


At December 31, 2012

(in €m)


market (level 1)


(level 2)



Total

FINANCIAL LIABILITIES 16,706 16,706

Derivatives 948 948



Other financial liabilities

Financial liabilities held for trading 948 948

Securities

Other financial liabilities 4,614 4,614





– 95 –



Note 4.3.2 - Analysis of financial assets and liabilities under level 3 fair value hierarchy

(in €m)

01/0

1/20

13

Recl

assi

ficat

ions

Gains and losses over the period posted to

Management events over the period Transfers for the period

Other Change

06/3

0/20

13Income statement

Equity Purchases/Issues

Disposals/Redemptions

To and from another

accounting category

To and from levels 1

and 2

Transactions still on the

balance sheet at

12/31/2012

Transactions still on the

balance sheet at

12/31/2012

FINANCIAL ASSETS 208 8 1 -2 215

Financial assets held for tradingFinancial assets designated at fair value through profit or loss

Hedging derivatives

Investments in associates 185 8 1 -1 193

Other securities

- Of which fixed-income securities


23 -1 22

Other financial assets 208 8 1 -2 215

Available-for-sale financial assets

FINANCIAL LIABILITIES

Financial liabilities held for tradingFinancial liabilities designated at fair value through profit or loss

Hedging derivatives

IFRS 13 provides specifics on fair value hierarchy levels. These specifics led the Group to reexamine the assignment of instruments to the three levels. No reclassification was made in this respect in the first half of 2013.

At June 30, 2013, financial instruments valued using non-observable data comprise investments in associates.

Structured loans granted to the local authorities entered in the financial assets category designated at fair value are, in the majority of cases, classified under level 2, as the majority of inputs used were considered observable.

During the period, €8m in gains and losses were posted directly to equity for level 3 financial assets.

– 96 –



Note 4.4 - Loans and receivables

Note 4.4.1 - Loans and receivables due from credit institutions

(in €m)

06/30/2013 12/31/2012


Impairment calculated on an individual basis

Impairment calculated on a collective basis

TOTAL LOANS AND RECEIVABLES DUE FROM CREDIT INSTITUTIONS 17,057 18,578

The fair value of loans and receivables due from credit institutions stood at €17,040m at June 30, 2013 and €18,544m at December 31, 2012.

Breakdown of loans and receivables due from credit institutions

(in €m)

06/30/2013 12/31/2012

Current accounts with overdrafts 2,201 640

Repurchase agreements 10,282 13,180

Deposits and loans 2,826 2,827

Finance leases 3 3

Subordinated and participating loans 24 24

Securities classified as loans and receivables 1,721 1,904

Impaired loans and receivables

TOTAL OF GROSS LOANS AND RECEIVABLES DUE FROM CREDIT INSTITUTIONS 17,057 18,578

Note 4.4.2 - Loans and receivables due from customers

(in €m)

06/30/2013 12/31/2012


Impairment calculated on an individual basis -730 -685

Impairment calculated on a collective basis -163 -144

TOTAL LOANS AND RECEIVABLES DUE FROM CUSTOMERS 105,292 108,741

The fair value of loans and receivables due from customers totalled €104,368m at June 30, 2013 and €107,467m at December 31, 2012.

– 97 –



Breakdown of loans and receivables due from customers

(in €m)

06/30/2013 12/31/2012

Current accounts with overdrafts 1

Loans to financial sector customers 2 3

Finance leases (1) 523 536

Short-term credit facilities 1,788 2,504

Equipment loans 17,167 16,786

Home loans 57,055 56,618

Export loans 1 1

Other loans 1,508 1,477

Other facilities granted to customers 78,044 77,925

Securities classified as loans and receivables 25,083 28,742

Other loans and receivables due from customers

Impaired loans and receivables 3,057 2,903

TOTAL OF GROSS LOANS AND RECEIVABLES DUE FROM CUSTOMERS 106,185 109,570

(1) Finance leases were previously classified as other loans and receivables due from customers.

– 98 –



Note 4.5 - Reclassification of financial assets

In compliance with the amendments to IAS 39 and IFRS 7 “Reclassification of Financial Assets”, Crédit Foncier reclassified certain available-for-sale financial assets as “Loans and receivables” in 2008.The table below shows the book value and fair value of these assets:

(in €m)

Dec. 2012 ChangeO/w principal

repayments over the period

O/w change in value due to

exchange rate differences

O/w change in value due to

interest rates

O/w amortisation of credit component at reclassification

date

Jun. 2013

Amortised cost (nominal +/- premium/discount)

9,108 -568 -314 -254 n/a n/a 8,540

Accrued interest 102 5 n/a n.s. n.s. n/a 107

Valuation of interest rate component (hedged)

2,008 -557 n/a -36 -521 n/a 1,451

Valuation of credit component (unhedged)

-92 5 n/a n/a n/a 5 -87

Impairment -5 n/a n/a n/a n/a -5

Impairment discount

Net book value 11,121 -1,115 -314 -290 -521 5 10,006

FAIR VALUE 9,800 -702 9,098

n/a: not applicablen.s.: not significant

Fair value hedges were contracted for reclassified assets showing interest rate and/or currency risk. Any change in value of the hedged items since the reclassification date is recognised in income and offset by the change in value of the attendant hedging instruments (interest rate and/or currency swaps) where appropriate. Amortisation of the credit component at the reclassification date is also posted to income and offset by the amortisation of unrealised losses on available-for-sale assets carried in equity to be recycled to the income statement at the time of reclassification.

If these assets had not been reclassified, equity to be reclassified to the income statement would have included additional post-tax capital gains of €271m at June 30, 2013.

As the “interest rate” component and the “exchange rate” components of these assets were hedged, the impact on the income statement is limited to interest for the period.

– 99 –



Note 4.6 - Held-to-maturity financial assets(in €m)

06/30/2013 12/31/2012

Bonds and other fixed-income securities 136 135

GROSS AMOUNT OF HELD-TO-MATURITY FINANCIAL ASSETS 136 135

At June 30, 2013, the fair value of financial assets held to maturity was €136m, compared to €135m at December 31, 2012.

Note 4.7 - Goodwill(in €m)

06/30/2013 12/31/2012

Opening net value 13 13

Acquisitions

Disposals

Impairment

Translation differences

Other changes

Closing net value 13 13

CFI’s buyback of minority interests had no impact on goodwill.

Goodwill by cash-generating unit (CGU)

(in €m)

06/30/2013 12/31/2012

Net book value

CFI 13 13

TOTAL GOODWILL 13 13

Impairment tests

As there was no evidence of impairment in the first half of 2013, the Group did not record any additional impairment losses.

– 100 –



Note 4.8 - Due to credit institutions(in €m)

06/30/2013 12/31/2012

Due to credit institutions - repayable on demand 422 140

Demand deposits 419 137

Accrued interest 3 3

Due to credit institutions - repayable at agreed maturity dates 38,286 36,516

Term deposits and loans 26,349 21,720

Repurchase agreements 11,845 14,704


TOTAL - DUE TO CREDIT INSTITUTIONS 38,708 36,656

The fair value of loans and receivables due from credit institutions stood at €38,711m at June 30, 2013 (€36,659m at December 31, 2012).

Note 4.9 - Debt securities(in €m)

06/30/2013 12/31/2012

Bonds 83,172 91,522

Interbank securities and negotiable debt securities 814 4,015

Other debt securities

Total 83,986 95,537

Accrued interest 1,459 2,008

TOTAL DEBT SECURITIES 85,445 97,545

The fair value of debt securities stood at €85,444m at June 30, 2013 (€97,544m at December 31, 2012).

– 101 –



Note 4.10 - Provisions(in €m)

Dec. 2012

Changes during the period

Jun. 2013Additions Utilised

Reversals not utilised

Other changes (1)

Provisions for employee benefits 45 2 -2 45

Provisions for end-of-career benefits 14 2 -2 14

Provisions for other long-term benefits 27 27

Provisions for long-service awards 3 3

Provisions for post-employment benefits 1 1

Provisions for off-balance sheet commitments

29 1 -2 28

Provision for claims and litigation 45 7 -1 -5 46

Provision for claims, litigation, fines and penalties relating to operating activities

18 3 -3 18

Provisions for claims, litigation, fines and penalties relating to banking activities

27 4 -1 -2 28

Other provisions 67 1 -2 -11 55

Other provisions for liabilities and charges relating to operating activities

47 1 -2 -11 35

Other provisions for liabilities and charges relating to consolidated equity investments

1 1

Other provisions for liabilities and charges relating to banking activities

19 19

Provision for restructuring costs 11 -1 -1 9

TOTAL PROVISIONS 197 11 -4 -19 -2 183

(1) Including changes in consolidation scope and exchange rates.

– 102 –



Note 4.11 - Subordinated debt(in €m)

06/30/2013 12/31/2012

Term subordinated debt 481 481

Perpetual subordinated debt

Perpetual deeply subordinated debt 280 280

Mutual deposits

Total 761 761


Revaluation of hedged items 22 30

TOTAL SUBORDINATED DEBT 810 803

At June 30, 2013, the fair value of subordinated debt stood at €810m and at €803m at December 31, 2012.

Change in subordinated debt in the first half of 2013

(in €m)

Dec. 2012 Issues Redemptions Other changes (1) June 2013

Term subordinated debt 481 481

Perpetual subordinated debt

Perpetual deeply subordinated debt 280 280

Accrued interest 12 15 27

Revaluation of hedged items 30 -8 22

TOTAL SUBORDINATED DEBT 803 7 810

(1) Including changes in consolidation scope and exchange rates.

– 103 –



Note 5 - Notes to the income statement

Note 5.1 - Interest income and expense(in €m)

H1 2013 H1 2012

Income Expense Net Income Expense Net

Loans and receivables due from customers 1,552 -3 1,549 1,843 -3 1,840

Loans and receivables due from credit institutions 57 -184 -127 102 -194 -92

Finance leases 13 13 16 16

Debt securities and subordinated debt -1,357 -1,357 -1,684 -1,684

Hedging derivatives 1,376 -1,289 87 2,413 -2,074 339

Available-for-sale financial assets 56 56 61 61

Held-to-maturity financial assets 1 1 8 8

Impaired financial assets

Other income and expense -3 -3 5 -75 -70

TOTAL INTEREST INCOME AND EXPENSE (1) 3,055 -2,836 219 4,448 -4,030 418

(1) Of which €124m in income from the redemption of covered bonds now classified as gains and losses on AFS for H1 2012 (see note 1.3.5).

Note 5.2 - Fee and commission income and expense(in €m)

H1 2013 H1 2012


Due to and from customers 39 -4 35 21 -1 20

Financial services rendered 3 -2 1 3 -1 2

Sale of life insurance products 60 60 57 57

Securities transactions -2 -2 -2 -2

Trust activities 2 2

Transactions on financial instruments and off-balance sheet items

2 2 3 -1 2

Other fees and commissions 2 -1 1 2 -1 1

TOTAL FEE AND COMMISSION INCOME AND EXPENSE 108 -9 99 86 -6 80

– 104 –



Note 5.3 - Net gains or losses on financial instruments at fair value through profit or loss(in €m)

H1 2013 H1 2012

Profit or loss on financial instruments held for trading 165 -39

Profit or loss on financial instruments designated at fair value through profit or loss -164 16

Profit or loss on hedging transactions 2 -1

- Ineffective portion of fair value hedges 2 -1

• fair value adjustment on hedging instruments 233 -482

• fair value adjustment on hedged items attributed to the hedged risks -231 481

- Ineffective portion of cash flow hedges

- Ineffective portion of hedges of net foreign currency investments

Foreign exchange transactions

TOTAL NET GAINS OR LOSSES ON FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS 3 -24

Note 5.4 - Net gains or losses on available-for-sale financial assets(in €m)

H1 2013 H1 2012

Income from sale or termination of loans and related receivables -29 -182

Dividends received 11 10

Long-term impairment of variable-income securities -2

TOTAL NET GAINS OR LOSSES ON AVAILABLE-FOR-SALE FINANCIAL ASSETS -18 -174

At June 30, 2013, this item included €42m in income from the sale of “loans and receivables”.

The income is presented net of gains and losses on the termination of related fair-value hedges.The French national accounting council’s Recommendation No. 2009 R 04, dated July 2, 2009, provides for income from the sale or termination of “available-for-sale financial assets”, “loans and receivables” and “held-to-maturity financial assets” to be recorded as “net gains or losses on available-for-sale financial assets”. Likewise, the Group includes income from the redemption of covered bonds carried out as part of its balance-sheet reduction strategy in the same category.

As such, this item posted €12m in income related to the cancellation of covered bonds at June 30, 2013. This amount is provided net of income from the termination of related fair-value hedges.

– 105 –



Note 5.5 - Income and expense on other activities(in €m)

H1 2013 H1 2012


Income and expense on insurance activities (1) 30 -15 15 28 -8 20

Income and expense on real estate activities 2 -2 1 -1

Income and expense on leasing activities -1 -1 2 -2

Income and expense on investment property 5 -1 4 2 -1 1

Other banking income and expense 26 -17 9 29 -20 9

Share of income from joint ventures 2 2 1 1

Rebilled expenses, income paid over -1 -1 -1 -1

Other operating income and expense 21 -11 10 26 -15 11

Additions and reversals to provisions on other operating income and expense

3 -5 -2 2 -4 -2

TOTAL INCOME AND EXPENSE ON OTHER ACTIVITIES 63 -36 27 62 -32 30

(1) The Group’s insurance activity consists in the sale of reverse mortgages to senior citizens. These capitalised-interest loans are repayable on the death of the borrower by transfer of the property pledged to guarantee the loan.In this respect, they correspond to the definition of contracts that incur insurance risk as per IFRS 4.

Note 5.6 - Operating expenses(in €m)

H1 2013 H1 2012

Personnel costs -156 -166

Other administrative costs -102 -98

Taxes other than on income -20 -18

External services -82 -80

TOTAL OPERATING EXPENSES -258 -264

Note 5.7 - Credit risk

Note 5.7.1 - Cost of risk - Individuals and Corporates

(in €m)

H1 2012 Provisions Net reversals (1)

Losses on non-hedged receivables

Recoveries of amortised receivables

H1 2013

Loans and receivables due from customers -52 -220 145 -4 13 -66

Signed commitments -1 -1 2 1

COST OF RISK - INDIVIDUALS AND CORPORATE -53 -221 147 -4 13 -65

(1) Corresponding to the reversal of impairment and net provisions on hedged losses.

– 106 –



Note 5.7.2 - Cost of risk - Sovereign

(in €m)

ProvisionsNet

reversals (1)

Losses on non-hedged receivables

Recoveries of amortised receivables

H1 2013 H1 2012

Loans and receivables due from customers -4


TOTAL COST OF RISK - SOVEREIGNS -4

(1) Corresponding to the reversal of impairment and net provisions on hedged losses.

Note 5.7.3 - Impairment and provisions for credit risk

(in €m)

Dec. 2012 Additions UtilisedReversals

not utilisedOther

changes June 2013

Due to and from customers 829 220 -10 -146 893

Other financial assets 4 -1 3

Impairment deducted from assets 833 220 -10 -146 -1 896

Provisions for signed commitments and financial guarantees granted

29 1 -2 28

TOTAL IMPAIRMENTS AND PROVISIONS FOR CREDIT RISK 862 221 -10 -148 -1 924

– 107 –



Note 5.7.4 - Total exposure to credit risk

(in €m)

06/30/2013 12/31/2012

Amount due to central banks 19 3,706

Financial assets at fair value through profit or loss (excl. variable-income securities) 2,914 3,438


Available-for-sale financial assets (excl. variable-income securities) 3,490 3,489




Net exposure of balance sheet commitments 136,432 148,404

Financial guarantees given 1,249 1,276

Signed commitments 8,665 8,602

Provisions for signed commitments -29

Net exposure of off-balance sheet commitments 9,914 9,849

TOTAL NET EXPOSURE TO CREDIT RISK 146,346 158,253

As of June 30, 2013, this note includes exposure to demand deposits with central banks. As a result, comparison data at December 31, 2012 was restated by €3,706m for the “amount due to central banks” item.

Note 5.8 - Income tax

Note 5.8.1 - Breakdown of income tax expense

(in €m)

06/30/2013 06/30/2013

Current taxes -24 -16

Deferred taxes (o/w deferred tax on zero interest rate loans) 34 15

INCOME TAX 10 -1

– 108 –



Note 5.8.2 - Reconciliation of accounting tax expense and theoretical tax expense

(in €m)

H1 2013 H1 2012

NET INCOME BEFORE TAX AND CHANGE IN THE VALUE OF GOODWILL (A) 5


Minority interests in consolidated companies 1 1

Share in net income of associates 1

Taxes 10 -1

French statutory income tax rate (B) 36.10% 36.10%

THEORETICAL INCOME TAX EXPENSE AT CURRENT FRENCH TAX RATE (AxB) -2

Impact of permanent differences 4 7

Temporary increase in income taxes -3

Reduced tax rates and exemptions

Taxes on previous year, tax credits and other taxes 6 -6

Impacts of change in tax rate -2

Other items 5

INCOME TAX 10 -1

Effective tax rate (income tax expense divided by taxable income) -686,00% 22.40%

The Group recorded €6m in non-recurring deferred tax income for the first half.

– 109 –



Note 6 - Financing and guarantee commitments and commitments on securities

Note 6.1 - Financing commitments(in €m)

06/30/2013 12/31/2012

Financing commitments given 8,655 8,572

- to credit institutions 48 21

- to customers 8,607 8,551

• Confirmed credit facilities 7,521 7,530

• Other commitments given 1,086 1,021

Total financing commitments given

Financing commitments received 7,894 4,641

- from credit institutions 7,894 4,641

- from customers

Note 6.2 - Guarantee commitments(in €m)

06/30/2013 12/31/2012

Guarantee commitments given 18,484 22,718

- to credit institutions 17,245 21,454

- to customers 1,239 1,264

Guarantee commitments received 81,592 83,694

- from credit institutions 19,523 21,905

- from customers 62,069 61,789

Note 6.3 - Commitments on securities(in €m)

06/30/2013 12/31/2012

Commitments on securities (securities for delivery) 12 12

Commitments on securities (securities receivable) 50 38

6.4 - Financial assets pledged as collateral(in €m)

06/30/2013 12/31/2012

Debt instruments 7,414 6,473

Loans and advances 11,619 16,780

TOTAL 19,033 23,253

– 110 –



Note 7 - Scope of consolidation at June 30, 2013

Consolidated companies Legal form Consolidation method % control % interest

Financial institutions

Compagnie de Financement Foncier SA Full 100.00 100.00

SCA Ecufoncier SCA Full 95.00 5.00

Financière Desvieux SA Full 100.00 100.00

Comptoir Financier de Garantie (CFG) SA Full 100.00 100.00

Locindus SA Full 74.49 74.49

SOCFIM SA Full 99.99 99.99

Banco Primus SA Full 100.00 100.00

Non-financial companies

Cofimab SNC Full 99.99 99.99

Crédit Foncier Immobilier SA Full 100.00 100.00

Gramat Balard SARL Full 100.00 99.99

Vauban Mobilisations Garanties (VMG) SA Full 100.00 99.99

Vendôme Investissements SA Full 99.99 99.99

Foncier Participations SA Full 100.00 100.00

Société d’investissement et de participation immobilière (SIPARI) SA Full 99.99 99.99

SEREXIM SAS Full 100.00 100.00

Foncière d’Evreux SA Full 100.00 99.99

SOCFIM Participations Immobilières SNC Full 100.00 99.99

Crédit Foncier Expertise SA Full 100.00 100.00

GCE Coinvest SAS Equity method 49.00 49.00

Maison France Confort P-I SAS Equity method 49.00 24.01

Debt securitisation funds (combined in technical entity E0222)

Partimmo 10/2002 FCC Full 100.00 100.00



Zèbre 1 FCC Full 100.00 100.00

Zèbre two FCC Full 100.00 100.00

Zèbre 2006-1 FCC Full 100.00 100.00

Special Purpose Entities

3 FINANCIAL INFORMATION / STATUTORY AUDITORS’ REPORT ON FINANCIAL INFORMATION

– 111 –






– 112 –

3 FINANCIAL INFORMATION / STATUTORY AUDITORS’ REPORT ON FINANCIAL INFORMATION


Statutory auditors’ report on the financial information for the first half of 2013Period from January 1, 2013 to June 30, 2013

To the Shareholders,

In compliance with the assignment entrusted to us by your Annual General Shareholders’ Meeting and in accordance with the requirements of article L. 451-1-2 III of the French Monetary and Financial Code, we hereby report to you on:• the review of the accompanying condensed interim

consolidated financial statements of Crédit Foncier de France S.A. for the period from January 1 to June 30, 2013;

• the verification of information contained in the interim management report.

These condensed consolidated interim financial statements have been prepared under the responsibility of your Board of Directors. Our role is to express an opinion on these financial statements based on our review.

I. Opinion on the financial statements

We conducted our review in accordance with professional standards applicable in France. A review essentially consists of interviewing persons responsible for accounting and financial matters and in applying analytical procedures. A review is substantially less extensive than an audit carried out in accordance with the professional standards applicable in France. As a result, we are less confident that the financial statements, taken as a whole, do not contain significant misstatements than we would be based on a full audit.

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed interim consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34 - the standard of IFRS as adopted by the European Union applicable to interim financial information.

II. Specific verification

We have also verified the information given in the Group’s interim management report commenting on the condensed interim financial statements subject to our review.

We have no observations to make regarding its fair presentation and consistency with the condensed interim consolidated financial statements.

Paris La Défense and Neuilly-sur-Seine, August 29, 2013

The Statutory Auditors

KPMG AuditA department of KPMG S.A.

Jean-François Dandé

PricewaterhouseCoopers Audit

Jean-Baptiste Deschryver

4 INFORMATIONS COMPLÉMENTAIRES

PERSONS RESPONSIBLE FOR THE DOCUMENT AND FOR AUDITING THE FINANCIAL STATEMENTS 114

CROSS-REFERENCE TABLE 115

CROSS-REFERENCE TABLE BETWEEN THE ANNUAL FINANCIAL REPORT AND THE UPDATED REGISTRATION DOCUMENT 118

4 - OTHER INFORMATION

– 113 –



– 114 –


Persons responsible for the document and for auditing the financial statementsPerson responsible for updating the registration document and the interim financial report

Mr Bruno Deletré, Chief Executive Officer of Crédit Foncier

Statement from the person responsible for the registration document

I hereby declare, after having taken every reasonable measure for this purpose, that the information provided in this update to the registration document is, to the best of my knowledge, true to fact and that no information has been omitted that would change the interpretation of the information provided.

I hereby declare that, to the best of my knowledge, the condensed consolidated financial statements of Crédit Foncier de France for the first half of 2013 have been prepared in accordance with applicable accounting standards and are an accurate reflection of the assets, financial position and results of the Company and the consolidated companies, and that the interim management report presents an accurate picture of the important events that occurred during the first six months of the year, their impact on the accounts as well as a description of the principal risks and uncertainties for the remaining six months of the year.

I received a letter from the Statutory Auditors indicating that they have completed their work, which consisted of verifying the information on the financial position and the financial statements provided in this update of the registration document, which they have read in its entirety.

Paris, August 29, 2013

Chief Executive Officer,Bruno DELETRÉ

Person responsible for the financial information

Ms Sandrine Guérin, Chief of International Corporate and Investment Banking

Persons responsible for auditing the financial statements

Permanent Statutory Auditors

KPMG AuditMember of the Compagnie Régionale des Commissaires aux comptes de Versailles (Regional Association of Statutory Auditors of Versailles)1, Cours Valmy - La Défense 92923Represented by Jean-François DandéStart of first term: April 26, 2010Length of term: 6 yearsExpiry of current term: At the end of the Annual General Shareholders’ Meeting called to approve the financial statements for the financial year ending December 31, 2015

PricewaterhouseCoopers AuditMember of the Compagnie Régionale des Commissaires aux comptes de Versailles (Regional Association of Statutory Auditors of Versailles)63, rue de Villiers - 92200 Neuilly-sur-SeineRepresented by Jean-Baptiste DeschryverLength of term: 6 yearsDate term was renewed: May 10, 2012Expiry of current term: At the end of the Annual General Shareholders’ Meeting called to approve the financial statements for the financial year ending December 31, 2017

Alternate Statutory Auditors

Malcom McLartyMember of the Compagnie Régionale des Commissaires aux comptes de Versailles (Regional Association of Statutory Auditors of Versailles)1, Cours Valmy - La Défense 92923Start of first term: April 26, 2010Length of term: 6 yearsExpiry of current term: At the end of the Annual General Shareholders’ Meeting called to approve the financial statements for the financial year ending December 31, 2015

Étienne BorisMember of the Compagnie Régionale des Commissaires aux comptes de Versailles (Regional Association of Statutory Auditors of Versailles)63, rue de Villiers - 92200 Neuilly-sur-SeineLength of term: 6 yearsDate term was renewed: May 10, 2012


– 115 –


Cross-reference tableListing of debt security issues and derivatives with a nominal value of less than €50,000(Annex IV of regulation EC no. 809/2004)

Update to the 2012 Registration

Document filed with the AMF on

August 29, 2013

2012 Registration Document

filed with the AMF on April 19, 2013

Items Pages Pages

1. PERSONS RESPONSIBLE

1.1. Persons responsible for information 114 299

1.2. Statement by persons responsible 114 299

2. STATUTORY AUDITORS

2.1. Identification of Statutory Auditors 114 300

2.2. Statutory Auditors for the period covered by the historical financial disclosures 114 300

3. SELECTED FINANCIAL INFORMATION

3.1. Financial information 5-6 5

3.2. Historic financial information for interim periods 5-6 n/a

4. RISK FACTORS 23-68 97-158

5. INFORMATION ABOUT THE ISSUER

5.1. History and development of the Company 6

5.1.1. Legal and commercial name of the issuer 296

5.1.2. Place of registration of the issuer and its registration number 296

5.1.3. Date of incorporation and term of the issuer 296

5.1.4. Registered office and legal form of the issuer 296

5.1.5.Recent events affecting the issuer that have a material impact on the evaluation of the issuer’s solvency

n/a n/a

5.2. Investments

5.2.1.Description of the main investments carried out since date of last financial statements

13 17-20

5.2.2.Information on main forthcoming investments for which the Executive Bodies have already made significant commitments

n/a n/a

5.2.3.Information on the expected sources of financing needed to honour the commitments referred to in 5.2.2.

n/a n/a


– 116 –


6. BUSINESS OVERVIEW

6.1. Principal activities 15-22 22-38

6.1.1. Main categories of services provided 22

6.1.2. New product sold or new activity 15-16 25

6.2. Main markets 15-22 24-38

6.3. Competitive positioning 16 25

7. ORGANISATIONAL STRUCTURE

7.1. Description of the Group and the Company’s position within the Group 11 14

7.2. Dependence on other entities in the Group 11/110 14/23/232/283

8. TREND INFORMATION

8.1.Declaration that no significant deterioration has affected the outlook of the Company since the date of its last financial report

72 297

8.2. Events reasonably likely to have a material effect on the issuer’s outlook n/a 297

9. PROFIT FORECASTS AND ESTIMATES n/a n/a

10. ADMINISTRATIVE, EXECUTIVE AND SUPERVISORY BODIES

10.1.Names, business addresses and functions of the administrative and management bodies and principal activities performed by them outside the company

9-10 42-57

10.2. Conflicts of interest statement 58

11. FUNCTIONING OF THE ADMINISTRATIVE AND EXECUTIVE BODIES

11.1. Information on the Audit Committee. Name of members and summary of terms 41-69

11.2. Corporate Governance 40-77

12. MAJOR SHAREHOLDERS

12.1. Ownership, control 11-12 16

12.2. Known arrangements liable to result in a change in control n/a n/a

13. FINANCIAL INFORMATION CONCERNING THE COMPANY’S ASSETS & LIABILITIES, FINANCIAL POSITION AND PROFIT AND LOSSES

13.1. Historic financial information 166-233

13.2. Annual Financial Statements

a) Balance sheet 168-169

b) Income Statement 170

c) Cash flow statement 173

d) Accounting methods and explanatory notes 174-233

13.3. Auditing of annual historical financial information

13.3.1. Statutory Auditors’ report 234-235

13.3.2. Other information from the Registration Document audited by the Statutory Auditors 67-77/79-82/238-285

13.3.3.Financial information contained within the Registration Document not obtained from the audited financial statements

n/a


– 117 –


13.4. Date of latest financial information

13.4.1. Last year for which financial information has been audited 74 168

13.5. Interim and other financial information

13.5.1Quarterly and half-year financial information since the date of the last audited financial statements

a) Balance sheet 76-77

b) Income Statement 78

c) Consolidated cash flow statement 81-82

d) Accounting methods and explanatory notes 83-110

13.5.2. Interim financial information since the end of the most recent year n/a n/a

13.6. Legal and arbitration proceedings 66 150-152

13.7. Significant change in the financial or sales position 72 297

• Statement 72 297

14. ADDITIONAL INFORMATION

14.1. Share capital 12 16

14.1.1. Total subscribed capital 12 16

14.2. Memorandum and by-laws 296-297

14.2.1. Register and corporate purpose 296

15. MATERIAL CONTRACTS

• Related-party agreements 287-294

16. THIRD-PARTY INFORMATION, STATEMENTS BY EXPERTS AND DECLARATIONS OF INTEREST n/a

17. DOCUMENTS AVAILABLE TO THE PUBLIC

Location where documents may be viewed during the dates that the Registration Document is valid

297

Chapters in the 2012 Registration Document No. D. 13-0397 not referred to above either serve no purpose for investors or are covered by another part of this update.


– 118 –


Cross-reference table between the annual financial report and the updated registration documentIn accordance with Article 212-13 of the AMF’s General Regulations, the this update includes information from the interim financial report mentioned in Article L. 451-1-2 of the French Monetary and Financial Code.

ITEMS COMPRISING THE INTERIM FINANCIAL REPORT AT JUNE 30, 2013Update to the 2012

Registration Document

Pages

STATEMENT FROM THE PERSON RESPONSIBLE FOR THE DOCUMENT 114

MANAGEMENT REPORT

• Main events during the first six months of the year 7-22/70-72

• Main risks and uncertainties 23-68

CONSOLIDATED FINANCIAL STATEMENTS

• Interim financial statements 74-110

• Statutory Auditors’ report on the interim financial statements 112

Production - Printing

Crédit Foncier de France: S.A. (French public limited company) with share capital of €1,331,400,718.80 - Paris Trade and Companies Register No. 542 029 848

Executive offices and postal address: 4, quai de Bercy - 94220 Charenton-le-Pont - Tel.: +33 1 57 44 80 00Head office: 19, rue des Capucines - 75001 Paris

creditfoncier.com

Documents

UPDATE TO THE 2012 REGISTRATION DOCUMENTCOMPANY PROFILE Profile Crédit Foncier is the only multi-expert in real estate financing in France With 15 regional offices across five major