Cofinimmo - Annual Financial Report 2015

RISK FACTORS

DESCRIPTION OF THE RISK POTENTIAL IMPACT

MITIGATING FACTORS AND MEASURES

Conflict of interest with

Cofinimmo’s investment

activities

Cofinimmo passes up an opportunity to invest

in certain assets itself.

The investments concerned are different from those of Cofinimmo.

Cofinimmo does not want to or cannot purchase these assets, either

because it feels that it already holds sufficient similar assets or because it

does not have the necessary financial means to acquire them. In the case

of co-investments (MAAF insurance agencies, for example), sharing the

risk may also be a desirable option.

Reclassification of the

Asset Management

business as a non-

ancillary activity in

the event where the

share of profits earned

exceeds 10% of the

profits of Cofinimmo

Investissements et

Services (CIS)

1. If this limit is exceeded, the regulatory

authorities may impose a penalty/fine and

demand the reduction/sale of the business.

2. Loss of the RREC status.

The Asset Management activities will be deliberately restricted so as not

to reach this limit.

Liability proceedings in

relation to losses incurred

on the portfolio managed

for third parties

Deterioration of the business relationship

with the investor who may accuse Cofinimmo

of not having sufficiently analysed the

investment products offered. Potential

payment of damages.

Cofinimmo Investissements et Services (CIS) only does business

with institutional investors which are aware of the risks related to the

investment products offered. The investment policy is clearly defined

with and approved by the investor. This policy is part of a contract

between Cofinimmo Investissements et Services (CIS) and the client. The

client’s decision to invest is based on the products offered by Cofinimmo

Investissements et Services (CIS), which criteria are defined in the

contract.

MANAGEMENT FOR THIRD PARTIES AND CO-INVESTMENTS

In 2013, Cofinimmo Investissements et Services (CIS)

launched an

asset management activity for third parties. It constitutes an ancillary

activity within the Group.

In addition, Cofinimmo also joins forces with third parties on some of

its investments. It materialises in the form of a share, on their behalf, in

the capital of subsidiary companies or other types of economic inter-

ests, such as the issue by these subsidiaries of mandatory convertible

bonds.

The above-mentioned mitigating factors and measures do not necessarily dissolve the entire potential impact of the identified risk. Hence, the

impact remains partially or entirely the company’s and, indirectly, its shareholders’ liability.

Formerly Cofinimmo France.