Consolidated Interim Financial statements first half 2026

BNP PARIBAS FORTIS SA/NV
CONSOLIDATED INTERIM FINANCIAL STATEMENTS
First half 2026

INTRODUCTION

BNP Paribas Fortis is a limited liability company (naamloze vennootschap (NV)/société anonyme (SA)), incorporated and existing under Belgian law, having its registered office address at Warandeberg 3, 1000 Brussels and registered under number BE VAT 0403.199.702 (hereinafter referred to as the ‘Bank’ or as ‘BNP Paribas Fortis’).

The BNP Paribas Fortis report for the first half-year of 2026 includes the Interim Report of the Board of Directors, the Statement of the Board of Directors, the composition of the Board, the Consolidated Interim Financial Statements and the notes to the Consolidated Interim Financial Statements for the first half-year of 2026.

The BNP Paribas Fortis Consolidated Interim Financial Statements for the first half-year of 2026, including the 2025 comparative figures, have been prepared at 30 June 2026 in accordance with IAS 34 ‘Interim Financial Reporting’ as adopted by the European Union. It includes condensed financial statements (balance sheet, profit and loss account, statement of net income and changes in fair value of assets and liabilities recognised directly in equity, statement of changes in shareholders' equity, minority interests and statement of cash flows) and selected explanatory notes. The BNP Paribas Fortis Consolidated Interim Financial Statements should be read in conjunction with the audited BNP Paribas Fortis Consolidated Financial Statements 2025, which are available on https://www.bnpparibasfortis.be.

As an issuer of listed debt instruments and in accordance with the EU Transparency Directive, BNP Paribas Fortis SA/NV is subject to obligations regarding periodic financial reporting, including half-yearly interim financial statements and an intermediate report by the Board of Directors.

All amounts in the tables of the consolidated interim financial statements are denominated in millions of euros, unless stated otherwise. Because figures have been rounded off, small discrepancies with previously reported figures may appear. Certain reclassifications have been made with regard to the prior year’s financial statements in order to make them comparable for the year under review.

BNP Paribas Fortis refers in the consolidated interim financial statements to the BNP Paribas Fortis SA/NV consolidated situation unless stated otherwise.

All information contained in the BNP Paribas Fortis interim financial statements for the first half-year of 2026 relates to the BNP Paribas Fortis statutory consolidated financial statements and does not cover the contribution of BNP Paribas Fortis to the BNP Paribas Group consolidated results, which can be found on the BNP Paribas website: www.bnpparibas.com.

The BNP Paribas Fortis interim financial statements for the first half-year of 2026 are available on the website: www.bnpparibasfortis.be.

CONTENTS

Introduction 3

Report of the Board of Directors 6

• Economic context 7
• Comments on the evolution of the results 8
• Comments on the evolution of the balance sheet 10
• Liquidity and solvency 13
• Principal risks and uncertainties 13

Statement of the Board of Directors 14

Composition of the Board of Directors 15

BNP PARIBAS FORTIS CONSOLIDATED INTERIM FINANCIAL STATEMENTS 30 JUNE 2026 18

• Profit and loss account for the first half of 2026 19
• Statement of net income and change in assets and liabilities recognised directly in equity 20
• Balance sheet at 30 June 2026 21
• Cash flow statement for the first half of 2026 22
• Statement of changes in shareholders’ equity 23

NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS 30 JUNE 2026 24

1. Materialaccounting policies applied by BNP Paribas Fortis 25

1.a Accounting standards 25

1.b Segment reporting 26

1.c Consolidation 27

1.d Translation of foreign currency transactions 30

1.e Financial information in hyperinflationary economies 31

1.f Net interest income, commissions and income from other activities 31

1.g Financial assets and financial liabilities 33

1.h Property, plant, equipment and intangible assets 44

1.i Leases 45

1.j Non-current assets held for sale and discontinued operations 47

1.k Employee benefits 47

1.l Share-based payments 48

1.m Provisions recorded under liabilities 49

1.n Current and deferred taxes 49

1.o Cash flow statement 50

1.p Use of estimates in the preparation of the financial statements 50

2. Notes to the profit and loss account for the first half of2026 52

2.a Net interest income 52

2.b Commission income and expense 53

2.c Net gain on financial instruments at fair value through profit or loss 53

2.d Net gain on financial instruments at fair value through equity 54

2.e Net income from other activities 54

2.f Other operating expense 55

2.g Cost of risk 55

2.h Net gain on non-current assets 62

2.i Corporate income tax 63

3. Segment information 64

3.a Operating segments 64

3.b Information by operating segment 65

4. Notes to the balance sheet at30 June 2026 67

4.a Financial instruments at fair value through profit or loss 67

4.b Financial assets at fair value through equity 69

4.c Measurement of the fair value of financial instruments 69

4.d Financial assets at amortised cost 78

4.e Impaired financial assets (Stage 3) 79

4.f Financial liabilities at amortised cost due to credit institutions and customers 80

4.g Debt securities and subordinated debt 80

4.h Current and deferred taxes 81

4.i Accrued income/expense and other assets/liabilities

4.j Property, plant, equipment and intangible assets used in operations, investment property

82

82

4.k Goodwill 83

4.l Provisions for contingencies and charges 84

4.m Offsetting of financial assets and liabilities 84

5. Commitments given or received 87

5.a Financing commitments given or received 87

5.b Guarantee commitments given by signature 87

5.c Securities commitments 88

6. Additional information 89

6.a Contingent liabilities: legal proceedings and arbitration 89

6.b Business combinations and loss of control or significant influence 90

6.c Minority interests

6.d Non Current Assets Held for Sale

91

92

6.e Other related parties 93

6.f Fair value of financial instruments carried at amortised cost 94

6.g Sovereign risks 96

6.h Scope of consolidation 97

6.i Cash Flow Statement 101

6.j Events after the reporting period 101

REPORT OF THE ACCREDITED STATUTORY AUDITOR 102

REPORT OF THE BOARD OF DIRECTORS

This section provides a summary of the evolutions in the first half of 2026 and elaborates on the following key developments:

1. Economic context;
2. Results of the first half of 2026 and the balance sheet as at 30 June 2026;
3. Status of liquidity and solvency;
4. Principal risks and uncertainties.

Economic context in the first half 2026

The US administration started out the new year in similar vein as it ended 2025, adopting an aggressive stance in several geopolitical issues. After having intervened in Venezuela, President Trump disquieted EU governments by renewing his call for the US to control Greenland. This tread of geopolitics unwound at the Davos conference however, even if the American president recently reiterated his designs on the island. Focus then shifted to the Middle East, as an uneasy alliance of the US and Israel came into conflict with Iran. Since the attack the strait of Hormuz, a key trade artery, has been mostly closed, resulting in gas and oil prices rising steeply.

The US Supreme Court ruled against the US Administration on the matter of the tariffs that president Trump announced early in 2025 and subsequently had been (re-)negotiating. New ways to implement trade tariffs will be found by the US administration however since it needs the proceeds to fund its “Big Beautiful Bill”.

Despite US inflation rising further, the US Federal Reserve remains stuck in a holding pattern. The new Fed Chairman Kevin Warsh recently turned the easing bias into a tightening bias. Taking into account the solid economic growth and tight labour market, BNP Paribas now forecasts three hikes up to the end of 2027 starting in December 2026 and followed up by two more hikes in 1Q 2027.

In the first half of 2026, the International Monetary Fund downgraded Türkiye’s full-year growth forecast twice, moving down to 2.9% by July 2026, as 1Q 2026 GDP growth slowed to 2.5% year-on-year. The IMF cited shocks from higher energy/commodity prices, weaker domestic demand and tighter financial conditions, projecting average 2026 inflation at 28.6%.

Meanwhile, the ECB has put in a rate hike, effective 17 June 2026. Even if the theoretical policy prescription would have been to ‘look through’ the supply-side crisis, the European central bankers elected to move to avoid runaway inflation, with another hike likely before the end of the summer. Whether a third-rate hike is in the cards depends on the Middle East conflict and oil prices. US inflation is expected to remain stable at 3.5% this year, up from 2.7% last year, and to decline somewhat to 2.7% next year. Growth is expected to increase somewhat from last year’s 2.1%: forecasts suggest growth rates of 2.4% this year and 2.5% in 2027.

Eurozone inflation rose this year, up from 2.1%. Currently 2.7% inflation is envisaged for the full year 2026 and 2.6% next year but these outlooks are surrounded by increased uncertainty because of the situation in the Middle East and the resulting trajectories of oil and gas prices.

This situation weighs down on GDP growth, which stood at 1.5% last year but is expected to remain close to 0.6% this year. 2027 would see a recovery to 1.6% in the base scenario.

Until a few weeks ago, the dollar was expected to depreciate further against the euro, to reach 1.26 by the end of 2027. A recent perceived deescalation in the Middle East made a reconsideration of the magnitude if not the direction of this trajectory necessary and the latest outlook now entails a USD/EUR ratio of 1.22 by the fourth quarter of 2027.

Overall European used car prices continue a steady normalisation and decline after post-pandemic spikes, though used electric vehicles buck the downward trend with higher demand, rising asking prices, and better retention rates as higher fuel prices caused by geopolitical tensions make thermal cars less attractive according to the European AUTO1 Group Price Index.

The Belgian labour market is cooling down, as the unemployment rate has risen slightly over the last 12 months. At the same time, vacancy rates and the Federgon temporary employment index are also declining, which is consistent with the pattern of a soft landing. This will not help the government to meet its budget goals: it had been counting on a higher employment rate to lower social expenditures and bring in more wage-related tax revenues.

In fact, government revenues, which stood at 49% of GDP last year, look to decline to 48.5% by 2028, according to the NBB’s latest projections. On the surface, a similar decline in current expenditures over the same period, from 47.9% to 47.4%, suggest a stabilisation of the current situation. The expected increase in military spending, on top of the yearly, mechanical pickup in interest rate charges, to be paid on the outstanding debt, conspire to push the public deficit from an already worrisome 5.2% in 2025 to 5.7% in 2028.

As a result, about 2% points of GDP are being added the debt-ratio every year. The NBB sees government debt at a hefty 114.8% by 2028, the horizon of its forecasting period.

Capital expenditure has changed markedly in terms of its composition, as business have shifted their focus to rationalisation, instead of expansion. Businesses remain mostly pessimistic, except for those in the construction sector, now that activity in the market for existing properties has recovered. Belgian real estate remains on an upward price trajectory, with also the number of transactions having recovered from its recent lull, following the ECB previous hike-cycle.

Private consumption has been slowing down since the start of the year. Recent changes to automatic wage indexation could further dampen private expenditures, even if a lower savings rate could compensate. Inflation has been on the rise, a consequence of the increased fuel prices, but second-order effects look less pronounced than during the 2022-2023 inflation episode. At the start of the 2nd trimester, many Belgian firms announced their intention to increase prices in an effort to pass on the higher energy costs. Those intentions have since declined, with consumers also expressing less fear of pending price increases. The situation however remains highly volatile, in the wake of geopolitical gyrations.

Comments on the evolution of the results

BNP Paribas Fortis realised a consolidated net income attributable to equity holders of 1,494 million euros in the first half of 2026, compared to 1,058 million euros in the first half of 2025, up by 436 million euros or 41%. This increase included the gain on the sale of the participation in AG Insurance for 636 million euros.

Please note that the comments in the present section have been written by referring to the financial statements and the respective notes. For a business-oriented analysis, please refer to the Press Release of BNP Paribas Fortis available on the corporate website. This analysis focuses on the underlying evolution, which excludes scope changes (acquisition, sale and transfer of activities), foreign exchange impacts and one-off results. By excluding these effects, BNP Paribas Fortis showed a decreasing underlying net income attributable to equity holders by (7%) compared to the first half of 2025. In the comments in the present section, we will refer to the scope changes and foreign exchange impacts when deemed necessary.

Operating income amounted to 1,778 million euros in the first half of 2026, up by 70 million euros or 4% compared to 1,708 million euros in the first half of 2025. The increase was the result of higher revenues by 238 million euros or 5%, marginal higher costs by (27) million euros or 1% and an increase in the cost of risk by (141) million euros.

Non-operating items (share of earnings of equity-method entities, net gain on non-current assets and goodwill) were up by 455 million euros. The corporate income tax increased by (86) million euros and the minority interests decreased by (3) million euros.

The comparison between the first half of 2026 and first half of 2025 results was impacted by the following elements:

• Scope changes, including mainly the sale of BNPP Asset Management in Q3 2025, the sale of AG Insurance in Q2 2026, the liquidation of BNPPF NY Branch in Q4 2025 and the liquidation of FCT Pulse France in Q1 2026;
• Foreign exchange variations, mostly the depreciation of the Turkish lira against euro (from 46.86 EUR/TRY in Q2 of 2025 to 53.29 EUR/TRY in Q2 of 2026).

Based on the segment information, 47% of the revenues were generated by banking activities in Belgium (mainly BNP Paribas Fortis and other legal entities of Commercial & Personal Banking), 25% by Arval & Leasing Solutions, 9% by banking activities in Luxembourg (mainly BGL BNP Paribas), 14% by banking activities in Turkey (mainly Turk Ekonomi Bankasi (“TEB”)) and 5% by Other (mainly Personal Finance).

Net interest income reached 2,741 million euros in the first half of 2026, an increase of 424 million euros or 18% compared to the first half of 2025. Excluding the foreign exchange effect ((45) million euros), the net interest income increased by 469 million euros.

In banking activities in Belgium and in Luxembourg, net interest income increased by 15% and 16% respectively, mainly driven by the Commercial and Personal Banking activities with higher deposit margins and volumes, partially offset by decreasing margins on loans. In banking activities in Turkey, the net interest income increased by 55% driven by higher commercial margins and increased volumes on loans and deposits. At Arval, there was an overall decrease in the net interest income driven by the increasing interest expenses (while most of its revenues are posted in the ‘net income from other activities’) and despite the fleet growth of 6%. At Leasing Solutions, the net interest income decreased by (2)% mainly due to lower margins and a delay in production of new leasing contracts.

Net commission income amounted to 876 million euros in the first half of 2026, up by 64 million euros or 8% compared to the first half of 2025. Excluding the scope changes (15 million euros) and the foreign exchange effect ((16) million euros), net commission income increased by 64 million euros.

In banking activities in Belgium, net commissions increased mainly driven by financial fees. The net commissions increased in all other segments, except in banking activities in Luxembourg and at Personal Finance.

Net results on financial instruments at fair value through profit or loss stood at 76 million euros in the first half of 2026, down by (66) million euros compared to the first half of 2025. Excluding the scope changes (5 million euros) and foreign exchange effect ((9) million euros), net results on financial instruments at fair value through profit or loss decreased by (62) million euros.

The decrease was mostly driven by banking activities in Turkey, with lower revenues from market activities servicing clients in the first half of 2026 as the revenues of the first half of 2025 benefited from a context of high volatility in currency exchange rates and interest rates.

Net results on financial instruments at fair value through equity stood at 4 million euros in the first half of 2026 compared to 13 million euros in the first half of 2025.

Net results on the derecognition of financial assets at amortised cost amounted to (2) million euros in the first half of 2026, compared to (1) million euros in the first half of 2025.

Net income from insurance activities totalled 40 million euros in the first half 2026, compared 32 million euros in the first half of 2025.

Net income from other activities totalled 1,695 million euros in the first half 2026, decreasing by (181) million euros or (10%) compared to the first half of 2025. Excluding the scope changes ((4) million euros) and foreign exchange effect ((12) million euros), net income from other activities decreased by (165) million euros.

The main contributor remained Arval thanks to results supported by a further expansion of the financed fleet (+6%). However, this increase was more than offset by a decrease of revenues on used cars ((306) million euros compared to the first half of 2025) in a context of conflict in the Middle East impacting the fuel price upwards and resulting in significantly lower used car prices.

Operating expenses amounted to (2,983) million euros in the first half of 2026, increasing by (12) million euros compared to the first half of 2025. Excluding the scope changes ((5) million euros) and the foreign exchange effect (43 million euros), there was an increase of (50) million euros.

The staff expenses were higher, mainly driven by banking activities in Turkey still impacted by the inflation and by Arval & Leasing Solutions following the growth of activities at Arval and the wage drift. In banking activities in Belgium, staff costs were lower following a decrease in FTEs. The decrease in other operating expenses is mainly attributable to banking activities in Belgium thanks to decreasing banking taxes with a lower contribution to the Deposit Guarantee Scheme (DGS) compared to the first half of 2025.

Depreciation charges stood at (223) million euros in the first half of 2026 compared to (208) million euros in the first half of 2025, i.e. an increase of (15) million euros.

Cost of risk totalled (446) million euros in the first half of 2026, i.e. an increase of (141) million euros compared to the first half of 2025. Excluding the scope changes (1 million euros) and the foreign exchange effect (14 million euros), there was an increase of (156) million euros. Following the review of the macroeconomic scenarios, a total impact for BNP Paribas Fortis of (37) million euros was accounted for in the cost of risk to reflect the geopolitical context.

In banking activities in Belgium, the cost of risk increased in the first half of 2026 compared to the first half of 2025, mainly due to higher stage 3 provisions in individual files. In banking activities in Luxembourg, the cost of risk increased driven by higher provisions in all stages. In banking activities in Turkey, the cost of risk increased with higher provisions in stage 3, partly compensated by lower stages 1 and 2. At Arval, a decrease in stage 1 and 2 was noted, while the provisions in stage 3 increased; and at Leasing Solutions as well as at Personal Finance higher provisions were noted across all stages.

Share of earnings of equity-method entities amounted to 76 million euros in the first half of 2026, compared to 221 million euros during the first half of 2025, i.e. a decrease of (145) million euros compared to the first half of 2025. Excluding the scope changes ((102) million euros, of which (34) million euros linked to the disposal of the BNP Paribas Asset Management activities and (64) million euros linked to the sale of AG insurance), there was a decrease of (43) million euros. The decrease was mainly attributable to lower results at BNP Paribas Bank Polska and to the remaining profit realized on the sale of the non-banking activities of Isabel in Q1 2025 in banking activities in Belgium.

Net gain or loss on non-current assets amounted to 452 million euros in the first half of 2026 compared to (148) million euros in the first half of 2025, i.e. an increase of 600 million euros. The increase was mainly driven by the gain of 636 million euros following the sale of the 25% participation in AG Insurance in the second quarter of 2026, partly offset by the application of IAS 29 in banking activities in Turkey and in Arval & Leasing Solutions. According to IAS 29 in connection with the hyperinflation situation of the economy in Turkey, the line Results from monetary positions reported in Net gain or loss on non-current assets mainly includes the effect of the evolution of the consumer price index in Turkey on the valuation of non-monetary assets and liabilities and accrued income from the Turkish government bonds portfolio indexed on inflation and held by TEB.

Corporate income tax in the first half of 2026 totalled (611) million euros compared to (525) million euros, an increase of (86) million euros. Excluding the share of earnings of equity-method entities (reported net of income taxes), the effective tax rate stood at 38% in the first half of 2026 compared to 34% in the first half of 2025.

Net income attributable to minority interests amounted 201 million euros in the first half of 2026, compared to 198 million euros in the first half of 2025.

Comments on the evolution of the balance sheet

The total balance sheet of BNP Paribas Fortis amounted to 394.7 billion euros as at 30 June 2026, up by 2.5 billion euros or 1% compared to 392.2 billion euros as at 31 December 2025.

Based on the segment information, 61% of the assets were contributed by banking activities in Belgium, 21% by Arval & Leasing Solutions, 9% by banking activities in Luxembourg, 4% by banking activities in Turkey and 5% by Other.

Assets

Cash and amounts due from central banks amounted to 33.0 billion euros, a decrease of (6.3) billion euros compared to 31 December 2025, mainly driven by banking activities in Belgium and Luxembourg in overnight deposits at their respective National Banks.

Financial instruments at fair value through profit or loss stood at 9.5 billion euros, down by (0.1) billion euros compared to 31 December 2025.

Derivatives used for hedging purposes increased by 0.3 billion euros and amounted to 4.5 billion euros. The derivatives used for hedging purposes on the liability side decreased by (0.7) billion euros and amounted to 4.7 billion euros as at 30 June 2026.

Financial assets at fair value through Other Comprehensive Income amounted to 15.0 billion euros as at 30 June 2026, up by 1.2 billion euros compared to 13.8 billion euros as at 31 December 2025.

Financial assets at amortised cost amounted to 271.0 billion euros as at 30 June 2026 and increased by 6.8 billion euros compared to 31 December 2025.

Loans and advances to customers amounted to 234.6 billion euros, up by 4.6 billion euros. In banking activities in Belgium, the increase was mainly related to on-demand accounts, mortgage loans and term loans, but partly offset by a decrease in reverse repos. Loans and advances to customers increased in all segments, albeit for different reasons: in banking activities in Luxembourg, the on-demand accounts increased most, while at Leasing Solutions and in banking activities in Turkey the growth stems mainly from term loans. At Personal Finance, the growth was mainly driven by consumer loans.

In addition, Loans and advances to credit institutions increased by 1.7 billion euros.

Debt securities at amortised cost amounted to 15.7 billion euros, increased by 0.5 billion euros compared to 31 December 2025.

Remeasurement adjustment on interest-rate risk hedged portfolios amounted to (1.1) billion euros compared to (1.0) billion euros as at 31 December 2025. This evolution is mainly driven by banking activities in Belgium and in relation with the evolution of interest rates.

Investments and other assets related to insurance activities amounted to 0.6 billion euros; a slight increase of 0.1 billion euros compared to 31 December 2025.

Current and deferred tax assets amounted to 0.8 billion euros, up by 0.1 billion euros compared to 0.7 billion euros as at 31 December 2025.

Accrued income and other assets stood at 12.3 billion euros as at 30 June 2026, an increase of 0.9 billion euros compared to 11.4 billion euros as at 31 December 2025.

Equity-method investments amounted to 1.4 billion euros, down by (0.1) billion euros compared to 1.5 billion euros as at 31 December 2025.

Property, plant and equipment and Investment property amounted to 46.3 billion euros as at 30 June 2026, up by 1.0 billion euros compared to 45.3 billion euros as at 31 December 2025, mainly related to the growth of the financed fleet at Arval (+2%, from 1.895k to 1,932k vehicles as at 30 June 2026).

Non-current assets held for sale amounted to 0.8 billion euros as at 31 December 2025. The investment in AG Insurance was reclassified as at 31 December 2025 from Equity-method investments following the signing of a framework agreement on 7 December 2025 between BNP Paribas Fortis and Ageas Group. Ageas, owner of 75% of the shares in AG Insurance and BNP Paribas Fortis, owner of 25% of the shares in AG Insurance, have agreed that the latter will sell its stake in AG Insurance to the former in exchange of a cash consideration of 1.9 billion euros. The sale was finalised in the second quarter of 2026 and the caption Non-current assets held for sale was therefore derecognised from the Balance sheet as at 30 June 2026.

Liabilities and Equity

Deposits from central banks stood at 2.4 billion euros as at 30 June 2026, up by 0.3 billion euros compared to 31 December 2025.

Financial instruments at fair value through profit or loss decreased by (2.8) billion euros, totalling 16.7 billion euros as at 30 June 2026 compared to 19.5 billion euros as at 31 December 2025. This difference is mainly explained by the decrease of the repos activity and the negative evolution of interest rate derivative instruments, only partly compensated by the debt securities issued, all in banking activities in Belgium.

Financial liabilities at amortised cost amounted to 317.4 billion euros as at 30 June 2026, up by 3.6 billion euros compared to 313.8 billion euros as at 31 December 2025.

Deposits from customers stood at 229.8 billion euros, up by 5.1 billion euros compared to 224.7 billion euros as at 31 December 2025. The increase in banking activities in Belgium stems mostly from an increase in saving and term accounts, while in banking activities in Luxembourg, the decrease of non-regulated accounts was more than compensated by the increase in term deposits.

Deposits from credit institutions decreased by (0.8) billion euros mainly caused by banking activities in Belgium, where higher repos were only partly offset by a decrease in interbank borrowings. Banking activities in Luxembourg showed an increase in interbank borrowings.

Debt securities decreased by (0.7) billion euros. Issued bonds decreased in Belgium banking activities and at Arval by 2.1 billion euros compared to 31 December 2025 and was partly offset by an increase in saving certificate issuances and negotiable debt securities in both Belgium and Luxembourg banking activities.

Subordinated debt stood at 6.8 billion euros as at 30 June 2026, stable compared to 31 December 2025.

Remeasurement adjustment on interest-rate risk hedged portfolios amounted to (1.9) billion euros compared to (2.3) billion euros as at 31 December 2025. This evolution is mainly explained by banking activities in Belgium due to the evolution of interest rates.

Current and deferred tax liabilities amounted to 1.9 billion euros as at 30 June 2026, compared to 1.7 billion euros as at 31 December 2025.

Accrued expenses and other liabilities stood at 12.1 billion euros as at 30 June 2026, up by 1.5 billion euros compared to 31 December 2025. This increase is mainly linked transactions not yet settled at the end of the month and for which settlement occurred in the beginning of July 2026.

Liabilities related to insurance contracts amounted to 0.3 billion euros as at 30 June 2026, stable compared to 31 December 2025.

Provisions for contingencies and charges amounted to 3.3 billion euros as at 30 June 2026, decreasing by (0.1) billion euros compared to the 3.4 billion euros as at 31 December 2025. The decrease is mainly driven by Arval, in relation to the reversal of provisions for uncertainty on the residual value of vehicles (for an amount of (74) million euros), provisions which were created for Plug-in Hybrid Electric Vehicle delivered before 2023 in a context of some uncertainty in the used car markets. Provisions for litigations have increased by 45 million euros compared to 31 December 2025, mainly as a response to a ruling in the UK regarding the interest margins to customers on car loans.

Shareholders’ equity amounted to 31.4 billion euros as at 31 December 2025, up by 0.2 billion euros compared with 31.2 billion euros as at 31 December 2025. Retained earnings in banking activities in Belgium were mainly impacted by the net income attributable to shareholders contributing for 1.5 billion euros as at 30 June 2026, but were partly offset by the dividend distribution of -2.0 billion euros. Changes in assets and liabilities recognised directly in equity increased by 0.4 billion euros mainly following to the derecognition of unrealised or deferred gains or losses on recyclable items through profit or loss related to the sale of AG insurance.

Minority interests stood at 6.4 billion euros as at 30 June 2026, a slight decrease of (0.1) billion euros compared to 31 December 2025.

Liquidity and solvency

BNP Paribas Fortis’ liquidity position remained sound, with a non-consolidated LCR and NSFR for the period ending 30 June 2026 respectively at 130% and 109% (versus 138% and 109% at 31 December 2025).

BNP Paribas Fortis’ solvency stood well above the minimum regulatory requirements. At 30 June 2026, BNP Paribas Fortis’ Basel III Common Equity Tier 1 ratio (CET1 ratio) stood at 14.0%. Total risk-weighted assets amounted to 187.7 billion euros at 30 June 2026, of which 152.6 billion euros are related to credit risk, 2.1 billion euros to market risk and 22.5 billion euros to operational risk, while counterparty risk, securitisation and equity risk worked out at 1.9 billion euros, 1.6 billion euros and 7.0 billion euros respectively.

Principal risks and uncertainties

BNP Paribas Fortis’ activities are exposed to a number of risks, such as credit risk, market risk, liquidity risk and operational risk. To ensure that these risks are identified and adequately controlled and managed, the Bank adheres to a number of internal control procedures and refers to a whole array of risk indicators, which are further described in the Chapter ‘Risk management and capital adequacy’ of the BNP Paribas Fortis consolidated financial statements 2025 and in the BNP Paribas Fortis Pillar 3 disclosure 2025.

BNP Paribas Fortis is involved as a defendant in various claims, disputes and legal proceedings in Belgium and in some foreign jurisdictions, arising in the ordinary course of its banking business, as further described in note 6.a ‘Contingent liabilities: legal proceedings and arbitration’ to the BNP Paribas Fortis interim financial statements for the first half-year of 2026.

Events after the reporting period is described in note 6.j ‘Events after the reporting period’ to the BNP Paribas Fortis consolidated interim financial statements for the first half-year of 2026.

STATEMENT OF THE BOARD OF DIRECTORS

In accordance with article 13 of the Royal Decree of 14 November 2007, we confirm that, to the best of our knowledge, as at 30 June 2026:

a) the condensed set of financial statements, prepared in accordance with the applicable set of accounting standards, gives a true and fair view of the assets, liabilities, financial position of BNP Paribas Fortis and the undertakings included in the consolidation as of 30 June 2026 and of the result and cash-flows of the period then ended.

b) the interim management report includes a fair review of the development, results and position of BNP Paribas Fortis and the undertakings included in the consolidation, together with a description of the principal risks and uncertainties with which they are confronted.

c) The Board of Directors reviewed the BNP Paribas Fortis consolidated interim financial statements on 3 September 2026 and authorised their issue.

Brussels, 3 September 2026

The Board of Directors of BNP Paribas Fortis

COMPOSITION OF THE BOARD OF DIRECTORS

As at 30 June 2026, the composition of the Board of Directors is as follows:

JADOT Maxime
Chairman of the Board of Directors. Non-executive director.
Member of the Board of Directors since 13 January 2011.
The current board member mandate has been renewed on 20 April 2023.
It will expire at the end of the 2027 annual general meeting of shareholders.

ANSEEUW Michael
Executive director. Chairman of the Executive Board.
Member of the Board of Directors since 19 April 2018.
The current board member mandate has been renewed on 23 April 2026.
It will expire at the end of the 2030 annual general meeting of shareholders.

BORDENAVE Philippe
Vice-chairman of the Board of Directors. Non-executive director.
Member of the Board of Directors since 20 April 2023.
The board member mandate will expire at the end of the 2027 annual general meeting of shareholders.

de CLERCK Daniel
Executive director.
Member of the Board of Directors since 12 December 2019.
The current board member mandate has been renewed on 20 April 2023.
It will expire at the end of the 2027 annual general meeting of shareholders.

de L’ESCAILLE Laurence
Independent non-executive director.
Member of the Board of Directors since 18 April 2024.
The board member mandate will expire at the end of the 2028 annual general meeting of shareholders.

GAVGANI Bernard
Non-executive director.
Member of the Board of Directors since 24 April 2025.
The board member mandate will expire at the end of the 2029 annual general meeting of shareholders.

HARTMANN Nathalie
Non-executive director.
Member of the Board of Directors since 20 April 2023.
The board member mandate will expire at the end of the 2027 annual general meeting of shareholders.

LECLERCQ Anne
Independent non-executive director.
Member of the Board of Directors since 23 April 2026.
The board member mandate will expire at the end of the 2030 annual general meeting of shareholders.

MERLO Sofia
Non-executive director.
Member of the Board of Directors since 21 April 2016.
The current board member mandate has been renewed on 18 April 2024.
It will expire at the end of the 2028 annual general meeting of shareholders.

RAYS Franciane
Executive director.
Member of the Board of Directors since 24 April 2025.
It will expire at the end of the 2029 annual general meeting of shareholders.

STOCKX Frank
Independent non-executive director.
Member of the Board of Directors since 23 April 2026.
It will expire at the end of the 2030 annual general meeting of shareholders.

VAN HECKE Didier
Executive director.
Member of the Board of Directors since 23 April 2026.
It will expire at the end of the 2030 annual general meeting of shareholders.

VAN WAEYENBERGE Titia
Independent non-executive director.
Member of the Board of Directors since 18 April 2019.
The current board member mandate has been renewed on 20 April 2023.
It will expire at the end of the 2027 annual general meeting of shareholders.

VARÈNE Thierry
Non-executive director.
Member of the Board of Directors since 14 May 2009.
The current board member mandate has been renewed on 18 April 2024.
It will expire at the end of the 2028 annual general meeting of shareholders.

VERMEIRE Stéphane
Executive director.
Member of the Board of Directors since 19 April 2018.
The current board member mandate has been renewed on 23 April 2026.
It will expire at the end of the 2030 annual general meeting of shareholders.

WILIKENS Sandra
Executive director.
Member of the Board of Directors since 21 April 2022.
The current board member mandate has been renewed on 23 April 2026.
The board member mandate will expire at the end of the 2030 annual general meeting of shareholders.

The BNP Paribas Fortis Board of Directors, which is responsible for setting general policy and supervising the activities of the Executive Board, is currently composed of sixteen (16) directors, of whom ten (10) are non-executive directors (four (4) of them are appointed as independent directors in compliance with the criteria laid down in the Banking Law) and six (6) of them are executive directors.

Accredited Statutory Auditor:
Deloitte Bedrijfsrevisoren BV / Deloitte Réviseurs d'Entreprises SRL, represented in 2026 by Mr. Yves DEHOGNE.

BNP PARIBAS FORTIS CONSOLIDATED INTERIM FINANCIAL STATEMENTS 30 JUNE 2026

Prepared in accordance with International Financial Reporting Standards as adopted by the European Union

Profit and loss account for the first half of 2026

Statement of net income and change in assets and liabilities recognised directly in equity

Balance sheet at 30 June 2026

Cash flow statement for the first half of 30 June 2026

Statement of changes in shareholders’ equity between 31 December 2024 and 30 June 2026

NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS 30 JUNE 2026

Prepared in accordance with International Financial Reporting Standards as adopted by the European Union

1. MATERIALACCOUNTING POLICIES APPLIED BY BNP PARIBAS FORTIS

1.a Accounting standards

1.a.1 Applicable accounting standards

The consolidated financial statements of BNP Paribas Fortis have been prepared in accordance with international accounting standards (International Financial Reporting Standards – IFRS), as adopted for use in the European Union1 . Accordingly, certain provisions of IAS 39 on hedge accounting have been excluded.

These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 “Interim financial Reporting”.

The same accounting policies and methods of computation are followed in the interim financial statements as compared with the annual financial statements 2025 of BNP Paribas Fortis.

The introduction of other standards, amendments and interpretations that are mandatory as from 1 January 2026 had no effect on the financial statements of BNP Paribas Fortis as at 30 June 2026.

1.a.2 New Major Accounting Standards, published but not yet applicable

BNP Paribas Fortis did not early apply new standards, amendments and interpretations endorsed by the European Union when the application in 2025 was optional.

The impact assessment of the new standards and amendments not yet applicable by BNP Paribas Fortis is presented below:

Publication of IFRS 18 “Presentation and disclosure in financial statements” in replacement of IAS 1 “Presentation of Financial Statements”.

IFRS 18 will be mandatory from 1 January 2027, with retrospective application.

IFRS 18 includes many of the requirements of IAS 1 without changes and supplements them with new requirements relating to:

• the presentation of specific categories (operating, investment and financing) and sub-totals in the statement of profit or loss;
• information to be disclosed in the notes to the financial statements on management-defined performance measures (MPM);
• aggregation and disaggregation of information in the statement of profit or loss account.

BNP Paribas Fortis continued to assess the detailed implications of applying IFRS 18 to the BNP Paribas Fortis consolidated financial statements and does not expect significant changes to the presentation of its profit and loss account. Indeed, most of the elements included in the operating result remain classified as such since the Group’s activity includes providing financing to customer and investing in assets, which meet the definition of specified main business activities. As a result, BNP Paribas Fortis does not expect any significant changes to the presentation of its income statement other than those resulting from the reclassification to operating income of items previously classified under "Net gain on non-current assets" and "Goodwill".

1 The full set of standards adopted for use in the European Union can be found on the website of the European Commission at: https://ec.europa.eu/info/ business-economy-euro/company-reporting-and-auditing/company-reporting_en

In addition, regarding the measurement of the BNP Paribas Fortis' performance, with the exception of Revenues and Gross operating income, BNP Paribas Fortis has not identified any other performance indicators in its financial communication that could be identified as MPM.

Meanwhile, BNP Paribas Fortis continues to monitor the discussions and final decisions expected from the IFRS Interpretations Committee (IFRIC).

1.b Segment reporting

The bank considers that within the legal and regulatory scope of BNP Paribas Fortis (‘controlled perimeter’), the nature and financial effects of the business activities in which it engages and the economic environments in which it operates are best reflected through the following segments:

• banking activities in Belgium;
• banking activities in Luxembourg;
• banking activities in Turkey;
• Arval and Leasing solutions;
• other.

Operating segments are components of BNP Paribas Fortis:

• that engage in business activities from which it may earn revenues and incur expenses;
• whose operating results are regularly reviewed by the Board of Directors of BNP Paribas Fortis in order to make decisions about resources to be allocated to that segment and to assess its performance;
• for which discrete financial information is available.

The Board of Directors of BNP Paribas Fortis is deemed to be the chief operating decision maker (CODM) within the meaning of IFRS 8 ‘Operating Segments’, jointly overseeing the activities, performance and resources of BNP Paribas Fortis.

BNP Paribas Fortis, like many other companies with diverse operations, organises and reports financial information to the CODM in more than one way.

BNP Paribas Fortis and the legal entities that are part of the BNP Paribas Fortis Group exercise management control over the full legal and regulatory scope, known as the ‘controlled perimeter’, including the establishment of appropriate governance structures and control procedures.

Within this organisational structure and in the context of the regulatory scope (‘controlled perimeter’) of BNP Paribas Fortis, the operating segments mentioned above are best aligned with the core principles and criteria for determining operating segments as defined in IFRS 8 ‘Operating Segments’.

Transactions or transfers between the operating segments are entered into under normal commercial terms and conditions as would be the case with non-related third parties.

1.c Consolidation

1.c.1 Scope of consolidation

The consolidated financial statements of BNP Paribas Fortis include entities that are controlled by BNP Paribas Fortis, jointly controlled, and under significant influence, with the exception of those entities whose consolidation is regarded as immaterial to BNP Paribas Fortis. Companies that hold shares in consolidated companies are also consolidated.

Subsidiaries are consolidated from the date on which BNP Paribas Fortis obtains effective control. Entities under temporary control are included in the consolidated financial statements until the date of disposal.

1.c.2 Consolidation methods

Exclusive control

Controlled enterprises are fully consolidated. BNP Paribas Fortis controls a subsidiary when it is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

For entities governed by voting rights, BNP Paribas Fortis generally controls the entity if it holds, directly or indirectly, the majority of the voting rights (and if there are no contractual provisions that alter the power of these voting rights) or if the power to direct the relevant activities of the entity is conferred on it by contractual agreements.

Structured entities are entities established so that they are not governed by voting rights, for instance when those voting rights relate to administrative tasks only, whereas the relevant activities are directed by means of contractual arrangements. They often have the following features or attributes: restricted activities, a narrow and well-defined objective and insufficient equity to permit them to finance their activities without subordinated financial support.

For these entities, the analysis of control shall consider the purpose and design of the entity, the risks to which the entity is designed to be exposed and to what extent BNP Paribas Fortis absorbs the related variability. The assessment of control shall consider all facts and circumstances able to determine BNP Paribas Fortis' practical ability to make decisions that could significantly affect its returns, even if such decisions are contingent on uncertain future events or circumstances.

In assessing whether it has power, BNP Paribas Fortis considers only substantive rights which it holds or which are held by third parties. For a right to be substantive, the holder must have the practical ability to exercise that right when decisions about the relevant activities of the entity need to be made.

Control is reassessed if facts and circumstances indicate that there are changes to one or more of the elements of control.

Where BNP Paribas Fortis contractually holds the decision-making power, for instance where BNP Paribas Fortis acts as fund manager, it shall determine whether it is acting as agent or principal. Indeed, when associated with a certain level of exposure to the variability of returns, this decision-making power may indicate that BNP Paribas Fortis is acting on its own account and that it thus has control over those entities.

Minority interests are presented separately in the consolidated profit and loss account and balance sheet within consolidated equity. The calculation of minority interests takes into account the outstanding cumulative preferred shares classified as equity instruments issued by subsidiaries, when such shares are held outside BNP Paribas Fortis.

As regards fully consolidated funds, units held by third-party investors are recognised as debts at fair value through profit or loss, in as much as they are redeemable at fair value at the subscriber’s initiative.

For transactions resulting in a loss of control, any equity interest retained by BNP Paribas Fortis is remeasured at its fair value through profit or loss.

Joint control

Where BNP Paribas Fortis carries out an activity with one or more partners, sharing control by virtue of a contractual agreement which requires unanimous consent on relevant activities (those that significantly affect the entity’s returns), BNP Paribas Fortis exercises joint control over the activity. Where the jointly controlled activity is structured through a separate vehicle in which the partners have rights to the net assets, this joint venture is accounted for using the equity method. Where the jointly controlled activity is not structured through a separate vehicle or where the partners have rights to the assets and obligations for the liabilities of the jointly controlled activity, the BNP Paribas Fortis accounts for its share of the assets, liabilities, revenues and expenses in accordance with the applicable IFRS.

Significant influence

Companies over which BNP Paribas Fortis exercises significant influence or associates are accounted for by the equity method.

Significant influence is the power to participate in the financial and operating policy decisions of a company without exercising control. Significant influence is presumed to exist when BNP Paribas Fortis holds, directly or indirectly, 20% or more of the voting rights of a company. Interests of less than 20% can be included in the consolidation scope if BNP Paribas Fortis effectively exercises significant influence. This is the case for example for entities developed in partnership with other associates, where BNP Paribas Fortis participates in strategic decisions of the enterprise through representation on the Board of Directors or equivalent governing body, or exercises influence over the enterprise’s operational management by supplying management systems or senior managers, or provides technical assistance to support the enterprise’s development.

Changes in the net assets of associates (companies accounted for under the equity method) are recognised on the assets side of the balance sheet under ‘Investments in equity-method entities’ and in the relevant component of shareholders’ equity. Goodwill recorded on associates is also included under ‘equity-method investments’.

Whenever there is an indication of impairment, the carrying amount of the investment consolidated under the equity method (including goodwill) is subjected to an impairment test, by comparing its recoverable value (the higher of value-in-use and market value less costs to sell) to its carrying amount. Where appropriate, impairment is recognised under ‘Share of earnings of equity￾method entities’ in the consolidated income statement and can be reversed at a later date.

If BNP Paribas Fortis’ share of losses of an equity-method entity equals or exceeds the carrying amount of its investment in this entity, BNP Paribas Fortis discontinues including its share of further losses. The investment is reported at nil value. Additional losses of the equity-method entity are provided for only to the extent that BNP Paribas Fortis has contracted a legal or constructive obligation, or has made payments on behalf of this entity.

Where BNP Paribas Fortis holds an interest in an associate, directly or indirectly through an entity that is a venture capital organisation, a mutual fund, an open-ended investment company or similar entity such as an investment-related insurance fund, it may elect to measure that interest at fair value through profit or loss.

Realised gains and losses on investments in consolidated undertakings are recognised in the profit and loss account under ‘Net gain on non-current assets’.

The consolidated financial statements are prepared using uniform accounting policies for similar transactions and other events occurring in similar circumstances.

For transactions resulting in a loss of significant influence, any equity interest retained by the BNP Paribas Fortis is accounted for in accordance with IFRS 9 principles applicable to financial instruments held.

1.c.3 Consolidation rules

Elimination of intragroup balances and transactions

Intragroup balances arising from transactions between consolidated enterprises, and the transactions themselves (including income, expenses and dividends), are eliminated. Profits and losses arising from intragroup sales of assets are eliminated, except where there is an indication that the asset sold is impaired. Unrealised gains and losses included in the value of financial instruments at fair value through equity are maintained in the consolidated financial statements.

Translation of accounts expressed in foreign currencies

The consolidated financial statements of BNP Paribas Fortis are prepared in euros.

The financial statements of enterprises whose functional currency is not the euro are translated using the closing rate method. Under this method, all assets and liabilities, both monetary and non-monetary, are translated using the spot exchange rate at the balance sheet date. Income and expense items are translated at the average rate for the period.

Financial statements of BNP Paribas Fortis’ subsidiaries located in hyperinflationary economies, previously adjusted for inflation by applying a general price index are translated using the closing rate. This rate applies to the translation of assets and liabilities as well as income and expenses.

Differences arising from the translation of balance sheet items and profit and loss items are recorded in shareholders’ equity under ‘Exchange differences’ and in ‘Minority interests’ for the portion attributable to outside investors. Under the optional treatment permitted by IFRS 1, BNP Paribas Fortis has reset to zero all translation differences, by booking all cumulative translation differences attributable to shareholders and to minority interests in the opening balance sheet at 1 January 2004 to retained earnings.

On liquidation or disposal of some or all of an interest held in a foreign enterprise located outside the eurozone, leading to a change in the nature of the investment (loss of control, loss of significant influence or loss of joint control without keeping a significant influence), the cumulative exchange difference at the date of liquidation or sale is recognised in the profit and loss account.

Should the percentage of interest change without leading to a modification in the nature of the investment, the exchange difference is reallocated between the portion attributable to shareholders and that attributable to minority interests, if the entity is fully consolidated; if the entity is consolidated under the equity method, it is recorded in profit or loss for the portion related to the interest sold.

1.c.4 Business combination and measurement of goodwill

Business combinations

Business combinations are accounted for using the purchase method.

Under this method, the acquiree’s identifiable assets and liabilities assumed are measured at fair value at the acquisition date except for non-current assets classified as assets held for sale, which are accounted for at fair value less costs to sell.

The acquiree’s contingent liabilities are not recognised in the consolidated balance sheet unless they represent a present obligation on the acquisition date and their fair value can be measured reliably.

The cost of a business combination is the fair value, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued to obtain control of the acquiree.

Any contingent consideration is included in the cost, as soon as control is obtained, at fair value on the date when control was acquired. Subsequent changes in the value of any contingent consideration recognised as a financial liability are recognised through profit or loss.

Costs directly attributable to the business combination are treated as a separate transaction and recognised through profit or loss. Likewise, amounts paid to the seller (or to parties related to the seller) that remunerate transactions separate from the business combination are excluded from the acquisition cost. This includes, for example, amounts paid under commercial contracts entered concurrently with the acquisition and that did not pre-exist within the acquired entity. These amounts are recognised separately in accordance with the applicable IFRS standards.

BNP Paribas Fortis may recognise any adjustments to the provisional accounting within 12 months of the acquisition date.

Goodwill represents the difference between the cost of the combination and the acquirer’s interest in the net fair value of the identifiable assets and liabilities of the acquiree at the acquisition date. Positive goodwill is recognised in the acquirer’s balance sheet, while negative goodwill is recognised immediately in profit or loss, on the acquisition date.

Minority interests are measured at their share of the fair value of the acquiree’s identifiable assets and liabilities. However, for each business combination, BNP Paribas Fortis can elect to measure minority interests at fair value, in which case a proportion of goodwill is allocated to them. To date, BNP Paribas Fortis has never used this latter option.

Goodwill is recognised in the functional currency of the acquiree and translated at the closing exchange rate.

On the acquisition date, any previously held equity interest in the acquiree is remeasured at its fair value through profit or loss. In the case of a step acquisition, the goodwill is therefore determined by reference to the acquisition-date fair value.

Since the revised IFRS 3 has been applied prospectively, business combinations completed prior to 1 January 2010 were not restated for the effects of changes to IFRS 3.

As permitted under IFRS 1, business combinations that took place before 1 January 2004 and were recorded in accordance with the previously applicable accounting standards (Belgian GAAP), had not been restated in accordance with the principles of IFRS 3.

Measurement of goodwill

BNP Paribas Fortis tests goodwill for impairment on a regular basis.

Cash-generating units

BNP Paribas Fortis has split all its activities into cash-generating units2 representing major business lines. This split is consistent with the organisational structure and management methods of BNP Paribas Fortis and reflects the independence of each unit in terms of results and management approach. It is reviewed on a regular basis in order to take account of events likely to affect the composition of cash-generating units, such as acquisitions, disposals and major reorganisations.

2 As defined by IAS36

Testing cash-generating units for impairment

Goodwill allocated to cash-generating units is tested for impairment annually and whenever there is an indication that a unit may be impaired, by comparing the carrying amount of the unit with its recoverable amount. If the recoverable amount is less than the carrying amount, an irreversible impairment loss is recognised, and the goodwill is written down by the excess of the carrying amount of the unit over its recoverable amount.

Recoverable amount of a cash-generating unit

The recoverable amount of a cash-generating unit is the higher of the fair value of the unit less costs to sell, and its value in use.

Fair value is the price that would be obtained from selling the unit at the market conditions prevailing at the date of measurement, as determined mainly by reference to actual prices of recent transactions involving similar entities or on the basis of stock market multiples for comparable companies.

Value in use is based on an estimate of the future cash flows to be generated by the cash-generating unit, derived from the annual forecasts prepared by the unit’s management and approved by the Executive Management, and from analyses of changes in the relative positioning of the unit’s activities on their market. These cash flows are discounted at a rate that reflects the return that investors would require from an investment in the business sector and region involved.

1.d Translation of foreign currency transactions

The methods used to account for assets and liabilities relating to foreign currency transactions entered into by BNP Paribas Fortis, and to measure the foreign exchange risk arising on such transactions, depend on whether the asset or liability in question is classified as a monetary or a non-monetary item.

Monetary assets and liabilities3 expressed in foreign currencies

Monetary assets and liabilities expressed in foreign currencies are translated into the functional currency of the relevant entity at the closing rate. Foreign exchange differences are recognised in the profit and loss account, except for those arising from financial instruments designated as a cash flow hedge or a net foreign investment hedge, which are recognised in shareholders’ equity.

Non-monetary assets and liabilities expressed in foreign currencies

Non-monetary assets may be measured either at historical cost or at fair value. Non-monetary assets expressed in foreign currencies are translated using the exchange rate at the date of the transaction (i.e. date of initial recognition of the non-monetary asset) if they are measured at historical cost, and at the closing rate if they are measured at fair value.

Foreign exchange differences relating to non-monetary assets denominated in foreign currencies and recognised at fair value (equity instruments) are recognised in profit or loss when the asset is classified in ‘Financial assets at fair value through profit or loss’ and in equity when the asset is classified under ‘Financial assets at fair value through Other comprehensive income’.

3 Monetary assets and liabilities are assets and liabilities to be received or paid in fixed or determinable amounts of cash

1.e Financial information in hyperinflationary economies

BNP Paribas Fortis applies IAS 29 to the presentation of the accounts of its consolidated subsidiaries located in countries whose economies are in hyperinflation.

IAS 29 presents a number of quantitative and qualitative criteria to assess whether an economy is hyperinflationary, including a cumulative, three-year inflation rate approaching or exceeding 100%.

IAS 29 standard requires that the balance sheet and the profit or loss amounts not already expressed in terms of the measuring unit current at the end of the reporting period be restated by applying a general price index.

For this purpose:

• All non-monetary assets and liabilities of subsidiaries in hyperinflationary countries, including equity, are restated on the basis of changes in the Consumer Price Index (CPI) from the date of initial recognition in the balance sheet to the end of the reporting period. Each line of the profit and loss account is restated on the basis of changes in CPI between the dates when the transactions were realised and the end of the reporting period.
• Assets and liabilities linked by agreement to changes in prices, such as index linked bonds and loans, are adjusted at the reporting date, in accordance with the agreement.

In a period of inflation, an entity holding an excess of monetary assets over monetary liabilities loses purchasing power and an entity with an excess of monetary liabilities over monetary assets gains purchasing power to the extent the assets and liabilities are not linked to a price level.

The gain or loss on the net monetary position, which reflects this gain or loss on purchasing power incurred by BNP Paribas Fortis during the reporting period, may be derived as the difference resulting from the restatement of non￾monetary assets, equity and the profit and loss account and the adjustment of index linked assets and liabilities. This gain or loss is recognised under “Net gain on non-current assets”.

Financial statements of these subsidiaries are then translated into euros at the closing rate.

In accordance with the provisions of the IFRIC’s decision of March 2020 on classifying the effects of indexation and translation of accounts of subsidiaries in hyperinflationary economies, the Group has opted to present these effects (including the net book value effect at the date of the initial application of IAS 29) within changes in assets and liabilities recognised directly through equity related to exchange differences.

Since 1 January 2022, BNP Paribas Fortis has applied IAS 29 to the presentation of the accounts of its consolidated subsidiaries located in Türkiye.

1.f Net interest income, commissions and income from other activities

1.f.1 Net interest income

Income and expenses relating to debt instruments measured at amortised cost and at fair value through other comprehensive income are recognised in the income statement using the effective interest rate method.

The effective interest rate is the rate that ensures that the discounted estimated future cash flows through the expected life of the financial instrument or, when appropriate, a shorter period, is equal to the carrying amount of the asset or liability in the balance sheet. The effective interest rate measurement takes into account all fees received or paid that are an integral part of the effective interest rate of the contract, transaction costs, and premiums and discounts.

Commissions considered as an additional component of interest are included in the effective interest rate and are recognised in the profit and loss account in ‘Net interest income’. This category includes notably commissions on financing commitments when it is considered that the setting up of a loan is more likely than unlikely. Commissions received in respect of financing commitments are deferred until they are drawn and then included in the effective interest rate calculation and amortised over the life of the loan. Syndication commissions are also included in this category for the portion of the commission equivalent to the remuneration of other syndication participants.

1.f.2 Income and Expenses from Commissions and income from other activities

Commissions received with regards to banking and similar services provided (except for those that are integral part of the effective interest rate), revenues from property development and revenues from services provided in connection with lease contracts fall within the scope of IFRS 15 ‘Revenue from Contracts with Customers’.

This standard defines a single model for recognising revenue based on principles set out in five steps. These five steps enable to identify the distinct performance obligations included in the contracts and allocate the transaction price among them. The income related to those performance obligations is recognised as revenue when the latter are satisfied, namely when the control of the promised goods or services has been transferred.

The price of a service may contain a variable component. Variable amounts may be recognised in the income statement only if it is highly probable that the amounts recorded will not result in a significant downward adjustment.

Commission income and expense

BNP Paribas Fortis records commission income and expense in profit or loss:

• either over time as the service is rendered when the client receives continuous service. These include, for example, certain commissions on transactions with customers when services are rendered on a continuous basis, commissions on financing commitments that are not included in the interest margin, because the probability that they give rise to the drawing up of a loan is low, commissions on financial collateral, clearing commissions on financial instruments, commissions related to trust and similar activities, securities custody fees, etc. Commissions received under financial guarantee commitments are deemed to represent the initial fair value of the commitment. The resulting liability is subsequently amortised over the term of the commitment, in Commission Income.
• or at a point in time when the service is rendered, in other cases. These include, for example, distribution fees received, loan syndication fees remunerating the arrangement service, advisory fees, etc.

Income and expenses from other activities

Income from services provided in connection with lease contracts is recorded under ‘Income from other activities’ in the income statement as the service is rendered, i.e. in proportion to the costs incurred for maintenance contracts.

Regarding income from services provided in connection with lease contracts, BNP Paribas Fortis records them in profit or loss as the service is rendered, i.e. in proportion to the costs incurred for maintenance contracts. The corresponding expenses are recognised when the service is rendered. At the same time, provisions are recognised to cover risks mainly related to services provided like risk retention and relay-assistance vehicles.

1.g Financial assets and financial liabilities

Financial assets are classified at amortised cost, at fair value through other comprehensive income or at fair value through profit or loss depending on the business model and the contractual features of the instruments at initial recognition.

Financial liabilities are classified at amortised cost or at fair value through profit or loss at initial recognition.

Financial assets and liabilities are recognised in the balance sheet when BNP Paribas Fortis becomes a party to the contractual provisions of the instrument. Purchases and sales of financial assets made within a period established by the regulations or by a convention in the relevant marketplace are recognised in the balance sheet at the settlement date.

1.g.1 Financial assets at amortised cost

Financial assets are classified at amortised cost if the following two criteria are met: the business model objective is to hold the instrument in order to collect the contractual cash flows and the cash flows consist solely of payments relating to principal and interest on the principal.

The ‘financial assets at amortised cost’ category includes, in particular, loans granted by BNP Paribas Fortis, as well as, reverse repurchase agreements and securities held by BNP Paribas Fortis ALM Treasury in order to collect contractual flows and meeting the cash flow criterion.

Business model criterion

Financial assets are managed within a business model whose objective is to hold financial assets in order to collect cash flows through the collection of contractual payments over the life of the instrument.

The realisation of disposals close to the maturity of the instrument and for an amount close to the remaining contractual cash flows, or due to an increase in the counterparty's credit risk is consistent with a business model whose objective is to collect the contractual cash flows (‘collect’). Sales imposed by regulatory requirements or to manage the concentration of credit risk (without an increase in the asset’s credit risk) are also consistent with this business model when they are infrequent or insignificant in value.

Cash flow criterion

The cash flow criterion is satisfied if the contractual terms of the debt instrument give rise, on specified dates, to cash flows that are solely repayments of principal and interest on the principal amount outstanding.

The criterion is not met in the event of a contractual characteristic that exposes the holder to risks or to the volatility of contractual cash flows that are inconsistent with those of a non-structured or ‘basic lending’ arrangement. It is also not satisfied in the event of leverage that increases the variability of the contractual cash flows.

Interest consists of consideration for the time value of money, for the credit risk, and for the remuneration of other risks (e.g. liquidity risk), costs (e.g. administration fees), and a profit margin consistent with that of a basic lending arrangement. The existence of negative interest does not call into question the cash flow criterion.

The time value of money is the component of interest - usually referred to as the ‘rate’ component - which provides consideration for only the passage of time. The relationship between the interest rate and the passage of time must not be modified by specific characteristics that could call into question the respect of the cash flow criterion.

Thus, when the variable interest rate of the financial asset is periodically reset at a frequency that does not match the duration for which the interest rate is established, the time value of money may be considered as modified and, depending on the significance of that modification, the cash flow criterion may not be met. Some financial assets held by BNP Paribas Fortis present a mismatch between the interest rate reset frequency and the maturity of the index, or interest rates indexed to an average of benchmark rate. BNP Paribas Fortis has developed a consistent methodology for analysing this alteration of the time value of money.

Regulated rates meet the cash flow criterion when they provide consideration that is broadly consistent with the passage of time and do not expose to risks or volatility in the contractual cash flows that would be inconsistent with those of a basic lending arrangement.

Some contractual clauses may change the timing or the amount of cash flows. Early redemption options do not call into question the cash flow criterion if the prepayment amount substantially represents the principal amount outstanding and the interest thereon, which may include reasonable compensation for the early termination of the contract. For example, as regards loans to