69 Assessment of the transitions as of 31/12/2021: Formostof theentitiesandactivitiesconcerned, proactive transition plans were activated as soon as possible in 2021, with an intensification in the second half of the year: cash loans/borrowings between Group entities, Crédit Agricole SA bond issues, customer deposit accounts, cleared interest rate derivatives transitioned en masse via the clearing houses' conversion cycles in October (EONIA) and December (LIBOR excluding USD). The activation from 1 January 2022 of fallback clauses - considered to be a "safety net" - concerned a small part of the stock of contracts impacted by changes in the benchmark index. However, for non-cleared derivatives coveredby the ISDA fallbackprotocol,market participants have largely favoured the activation of fallbacks. At the Crédit Agricole Group level, few contracts referencingEONIA or CHF, EUR, GBP and JPY LIBOR could not be renegotiated before 31 December 2021 or switched to an alternative index by activating the fallback clause. This residual stock of contracts concerns either negotiations not finalised by 31 December, which should be concluded by early 2022, or contracts that benefit or will benefit from the legislative provisions in force. Risk management: Inaddition topreparingand implementing the replacement of benchmarks that wi l l disappear or become unrepresentative by 31 December 2021 and complying with BMR regulations, the project's work also focused on managing and controlling the risks inherent in the benchmark transitions, particularly with regard to the financial, operational, legal and compliance aspects, and in particular on the customer protection aspect (conduct risk prevention). For example, on the financial side, the risk of market fragmentation induced by the use of different types of rates (calculationof a predetermined rate at thebeginning of the interest period, known as " forward looking", or calculationof apost-determined rate, knownas "backward looking") and different conventions according to the classes of assets/currencies can lead to financial risks for those involved in the sector. However, it is anticipated that these risks, clearly identified within the Group, will tend to diminish as market standards emerge and the private sector - with the support of the banks - is able to manage this fragmentation. USD LIBOR: In 2022, thework of the transition programme continues, in particular to prepare for the cessation of publication of USDLIBORor its non-representativeness inJune 2023. This component primarily concerns the investment bank CACIB, theGroup entitywith the greatest exposure to this index. For the transition from USD LIBOR, the implementation of a legislative schemewill be confirmed by the UK authorities at a later stage, while the US authorities have already approved the designation of statutory replacement rates for New York law contracts. In order to ensure that accounting hedging relationships affected by this benchmark reform can be maintained despite uncertainties about the timing and methods of the transition from the current to the new interest rate indices, the IASB issued amendments to IAS 39, IFRS 9 and IFRS 7 in September 2019 which were adopted by the European Union on 15 January 2020. The Group applies these amendments as long as the uncertainties about the future of the indices will have an impact on the amounts and timing of the interest flows and therefore considers that all of its hedging contracts on the relevant indices canbenefit fromthese amendments at 31 December 2021. Further amendments, published by the IASB in August 2020, supplement those published in 2019 and focus on the accounting consequences of replacing the old benchmark interest rateswithother benchmarks following the reforms. These changes, known as "Phase 2", mainly concern changes in contractual cash flows. They allow entities not to derecognise or adjust the book value of financial instruments to reflect thechanges requiredby the reform, but rather to update the effective interest rate to reflect the change in the alternative benchmark rate. With regard to hedge accounting, entities will not have to de-designate their hedging relationships when they make the changes required by the reform and subject to economic equivalence. At 31 December 2021, the breakdown by significant benchmark of instruments based on the old benchmark rates and due to transition to the new rates before their maturity is as follows: (in millions of euros) EONIA LIBOR USD LIBOR GBP LIBOR JPY LIBOR CHF EURIBOR Total financial assets excluding derivatives Total financial liabilities excluding derivatives Total notional amounts of derivatives 28.7 1.242 In the absence of announcements regarding the forthcoming replacement of the EURIBOR, WIBOR and STIBOR indices, these have been excluded from the quantitative data provided.
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