FCA 2015.12.31 20FA


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 20-F/A
(Amendment No. 1)
 
o
REGISTRATION STATEMENT PURSUANT TO SECTIONS 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2015
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
o
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 001-36085
 
Fiat Chrysler Automobiles N.V.
(Exact Name of Registrant as Specified in Its Charter)
 
The Netherlands
(Jurisdiction of Incorporation or Organization)
 
25 St. James's Street
London SW1A 1HA
United Kingdom
Tel. No.: +44 (0) 20 7766 0311
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
 
Richard K. Palmer
25 St. James's Street
London SW1A 1HA
United Kingdom
Tel. No.: +44 (0) 20 7766 0311
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Company Contact Person)
 
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
 
Name of Each Exchange on which Registered
Common Shares, par value €0.01
 
New York Stock Exchange
Mandatory Convertible Securities due 2016
 
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 1,288,956,011 common shares, par value €0.01 per share, and 408,941,767 special voting shares, par value €0.01 per share.
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Act of 1934. Yes o No þ
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o





Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). N/A
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer þ
 
Accelerated filer o
 
Non-accelerated filer o
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP o International Financial Reporting Standards as issued by the International Accounting Standards Board þ Other o
If “Other” has been checked in response to the previous question indicate by check mark which financial statement item the registrant has elected to follow: Item 17 o or Item 18 o.
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o No þ
(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes o No o





EXPLANATORY NOTE

This Amendment No. 1 on Form 20-F/A (the “Amendment”) amends the Annual Report on Form 20-F for the year ended December 31, 2015 of Fiat Chrysler Automobiles N.V. (“FCA”), as originally filed with the U.S. Securities and Exchange Commission on February 29, 2016 (the “Original Filing”). FCA is filing the Amendment solely to amend and restate Exhibit 99.1“Consolidated Financial Statements of FCA Bank S.p.A. at December 31, 2015” to correct a transcription error in the Report of Independent Auditors to refer to “December 31, 2015” rather than “December 31, 2013.”
The Exhibit filed herewith supersedes in its entirety the Exhibit originally filed with the Original Filing. This Amendment does not affect any other parts of, or exhibits to, the Original Filing, nor does it reflect events occurring after the date of the Original Filing. Accordingly, this Amendment should be read in conjunction with the Original Filing and any documents filed with or furnished to the Securities and Exchange Commission by FCA subsequent to February 29, 2016.
























i





TABLE OF CONTENTS
 
Page
 
 
 
 
 
 
 
 
Item 19.
1
 
2
























ii





Item 19. Exhibits
Exhibit
Number
Description of Documents
1.1
English translation of the Articles of Association of Fiat Chrysler Automobiles N.V. (incorporated by reference to Exhibit 3.1 to Amendment No. 3 to Registration Statement on Form F-1, filed with the SEC on December 4, 2014, File No. 333-199285)
1.2
English translation of the Deed of Incorporation of Fiat Chrysler Automobiles N.V. (incorporated by reference to Exhibit 3.2 to Registration Statement on Form F-4, filed with the SEC on July 3, 2014, File No. 333-197229)

2.1
Terms and Conditions of the Global Medium Term Notes (incorporated by reference to Exhibit 4.1 to Registration Statement on Form F-4, filed with the SEC on July 3, 2014, File No. 333-197229)

2.2
Deed of Guarantee, dated as of March 19, 2013, by Fiat S.p.A. in favor of the Relevant Account Holders and the holders for the time being of the Global Medium Term Notes and the interest coupons appertaining to the Global Medium Term Notes (incorporated by reference to Exhibit 4.2 to Registration Statement on Form F-4, filed with the SEC on July 3, 2014, File No. 333-197229)
 
There have not been filed as exhibits to this Form 20-F/A certain long-term debt instruments, none of which relates to indebtedness that exceeds 10% of the consolidated assets of Fiat Chrysler Automobiles N.V. Fiat Chrysler Automobiles N.V. agrees to furnish the Securities and Exchange Commission, upon its request, a copy of any instrument defining the rights of holders of long-term debt of Fiat Chrysler Automobiles N.V. and its consolidated subsidiaries.
4.1
Indenture, dated December 16, 2014, between Fiat Chrysler Automobiles N.V. and The Bank of New York Mellon, as Trustee, relating to 7.875% Mandatory Convertible Securities due 2016 (incorporated by reference to Exhibit 4.1 to Report on Form 6-K, filed with the SEC on December 16, 2014, File No. 001-36675)
4.2
Fiat Chrysler Automobiles N.V. Equity Incentive Plan (incorporated by reference to Exhibit 4.2 to Registration Statement on Form S-8, filed with the SEC on January 12, 2015, File No. 333-201440)
4.3
Fiat Chrysler Automobiles N.V. Remuneration Policy (incorporated by reference to Exhibit 4.3 to Registration Statement on Form S-8, filed with the SEC on January 12, 2015, File No. 333-201440)
4.4
Indenture, dated as of April 14, 2015, between Fiat Chrysler Automobiles N.V. and The Bank of New York Mellon, as Trustee, relating to senior debt securities (incorporated by reference to Exhibit 4.1 to Report on Form 6-K, filed with the SEC on April 16, 2015, File No. 001-36676)
4.5
Form of 4.500% Rule 144A Global Note due 2020 (incorporated by reference to Exhibit 4.2 to Report on Form 6-K, filed with the SEC on April 16, 2015, File No. 001-36676)
4.6
Form of 4.500% Regulation S Global Note due 2020 (incorporated by reference to Exhibit 4.3 to Report on Form 6-K, filed with the SEC on April 16, 2015, File No. 001-36676)
4.7
Form of 5.250% Rule 144A Global Note due 2023 (incorporated by reference to Exhibit 4.4 to Report on Form 6-K, filed with the SEC on April 16, 2015, File No. 001-36676)
4.8
Form of 5.250% Regulation S Global Note due 2023 (incorporated by reference to Exhibit 4.5 to Report on Form 6-K, filed with the SEC on April 16, 2015, File No. 001-36676)
8.1
Subsidiaries (incorporated by reference to Exhibit 8.1 to Annual Report on Form 20-F, filed with the SEC on February 29, 2016, File No. 001-36675)
12.1
Section 302 Certification of the Chief Executive Officer
12.2
Section 302 Certification of the Chief Financial Officer
13.1
Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
13.2
Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.1
Consolidated Financial Statements of FCA Bank S.p.A. at December 31, 2015
99.2
Consolidated Financial Statements of FCA Bank S.p.A. at December 31, 2014 and 2013 (incorporated by reference to Exhibit 99.2 to Annual Report on Form 20-F, filed with the SEC on February 29, 2016, File No. 001-36675)
1





SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F/A and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
 
FIAT CHRYSLER AUTOMOBILES N.V.
 
(Registrant)
 
 
 
 
By:
 /s/ Richard K. Palmer
 
 
 
 
Name: Richard K. Palmer
 
Title: Chief Financial Officer
Dated: August 9, 2016
 
 











































2


Exhibit 12.1 20FA


Exhibit 12.1
FIAT CHRYSLER AUTOMOBILES N.V.
SECTION 302 CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER
I, Sergio Marchionne, Chief Executive Officer and Director of Fiat Chrysler Automobiles N.V., certify that:
1.
I have reviewed this annual report on Form 20-F, as amended by Amendment No.1 thereto, of Fiat Chrysler Automobiles N.V.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
4.
The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
5.
The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
 
 
 
 
Date: August 9, 2016
 /s/ Sergio Marchionne
 
Sergio Marchionne
 
Chief Executive Officer and Director
 
 


Exhibit 12.2 20FA


Exhibit 12.2
FIAT CHRYSLER AUTOMOBILES N.V.
SECTION 302 CERTIFICATION OF THE CHIEF FINANCIAL OFFICER
I, Richard K. Palmer, Chief Financial Officer of Fiat Chrysler Automobiles N.V., certify that:
1.
I have reviewed this annual report on Form 20-F, as amended by Amendment No.1 thereto, of Fiat Chrysler Automobiles N.V.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
4.
The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
5.
The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
 
 
 
 
Date: August 9, 2016
/s/ Richard K. Palmer
 
Richard K. Palmer
 
Chief Financial Officer


Exhibit 13.1 20FA




Exhibit 13.1
FIAT CHRYSLER AUTOMOBILES N.V.
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Sergio Marchionne, Chief Executive Officer and Director of Fiat Chrysler Automobiles N.V. (the “Company”), hereby certify pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
1.
the Company’s Annual Report on Form 20-F for the year ended December 31, 2015, as amended by Amendment No. 1 thereto, to which this statement is furnished as an exhibit (the “Report”), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2.
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


 
 
 
 
Date: August 9, 2016
 /s/ Sergio Marchionne
 
Sergio Marchionne
 
Chief Executive Officer and Director
 
 





Exhibit 13.2 20FA




Exhibit 13.2
FIAT CHRYSLER AUTOMOBILES N.V.
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Richard K. Palmer, Chief Financial Officer of Fiat Chrysler Automobiles N.V. (the “Company”), hereby certify pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
1.
the Company’s Annual Report on Form 20-F for the year ended December 31, 2015, as amended by Amendment No. 1 thereto, to which this statement is furnished as an exhibit (the “Report”), fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2.
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


 
 
 
 
Date: August 9, 2016
 /s/ Richard K. Palmer
 
Richard K. Palmer
 
Chief Financial Officer





Exhibit 99.1 20FA


Exhibit 99.1


FCA Bank Group
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2015




























CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2015
    














FCA Bank S.p.A.
Registered office: Corso G. Agnelli, 200 - 10135 Turin - www.fcabankgroup.com - Paid-up Share Capital : Euro 700,000,000 - , Turin Companies Register n. 08349560014, - Tax and VAT Code 08349560014 - Entered in the Bank Register n. 5764 - Holding of FCA Bank Banking Group - Entered in the Banking Group Register - Cod. ABI 3445 - Entered in Single Register of Insurance Intermediaries (RUI) no. D00016456.

























CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Statement of Financial Position
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Cash Flow
Notes to the Consolidated Financial Statements




































CONSOLIDATED STATEMENT OF FINANCIAL POSITION




ASSETS
(€ thousand)
 
 
 
 
 
 
 
 
BALANCE SHEET - ASSETS
31/12/2015
31/12/2014
 
 
 
 
10.
Cash and cash balances
21
22
20.
Financial assets held for trading
2,993
13,155
50.
Held-to-maturity investments
9,682
9,715
60.
Loans and receivables with banks
1,333,338
761,663
70.
Loans and receivables with customers
15,453,854
13,677,250
80.
Hedging derivatives
95,842
83,603
90.
Changes in fair value of portfolio heged items (+/-)
48,125
59,106
100.
Investments in associates and joint ventures
79
79
110.
Insurance reserves attributable to reinsures
22,385
34,007
120.
Property, plant and equipment
1,168,341
1,041,574
130.
Intangible assets
217,917
217,507
 
- goodwill
180,338
180,338
140.
Tax assets
280,612
250,614
 
a) current tax assets
113,349
81,284
 
b) deferred tax assets
167,263
169,330
 
of wich Law 214/2011
-
-
160.
Other assets
875,962
785,920
TOTAL ASSETS
19,509,151
16,934,215
 
 
 
 



LIABILITIES and NET EQUITY
(thousand)
 
 
 
 
 
 
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
31/12/2015
31/12/2014
 
 
 
 
10.
Deposits from banks
7,650,594
6,788,256
20.
Deposits from customers
453,801
169,382
30.
Debt securities in issue
8,244,250
7,069,598
40.
Financial liabilities held for trading
8,004
16,140
60.
Hedging derivatives
61,403
80,818
80.
Tax liabilities
108,850
86,027
 
a) current tax liabilities
45,695
39,979
 
b) deferred tax liabilities
63,155
46,048
100.
other liabilities
627,038
547,758
110.
Provision for employee severance pay
12,350
13,001
120.
Provisions for risks and charges
217,245
207,419
 
a) post retirement benefit obligations
39,261
33,777
 
b) Other reserves
177,984
173,642
130.
Insurance reserves
27,953
41,839
140.
Revaluation reserves
45,580
16,880
170.
Reserves
894,840
807,789
180.
Share premium
192,746
192,746
190.
Issued capital
700,000
700,000
210.
Minorities (+/-)
16,889
15,413
220.
Net Profit (Loss) for the year (+/-)
247,608
181,149
Total liabilities and Shareholders' Equity
19,509,151
16,934,215






CONSOLIDATED INCOME STATEMENT
 
 
 
 
 
 
 
 
Item
31/12/2015
31/12/2014
10.
 INTEREST INCOME AND SIMILAR REVENUES
729,002
737,429
20.
 INTEREST EXPENSES AND SIMILAR CHARGES
(285,031)
(372,803)
30.
NET INTEREST MARGIN
443,971
364,626
40.
FEE AND COMMISSION INCOME
120,332
113,124
50.
FEE AND COMMISSION EXPENSES
(40,219)
(30,562)
60.
NET FEE AND COMMISSION
80,113
82,562
80.
NET INCOME FINANCIAL ASSETS AND LIABILTIES HELD FOR TRADING
(2,222)
(2,141)
90.
FAIR VALUE ADJUSTMENTS IN HEDGE ACCOUNTING
(1,081)
(769)
120.
OPERATING INCOME
520,781
444,278
130.
IMPAIRMENT LOSSES ON:
(76,933)
(82,934)
 
a) loans
(76,933)
(82,934)
140.
NET PROFIT FROM FINANCIAL ACTIVITIES
443,848
361,344
150.
NET PREMIUM EARNED
1,537
1,990
160.
NET OTHER OPERATING INCOME/ CHARGES FROM INSURANCE ACTIVITIES
2,889
2,951
170.
NET PROFIT FROM FINANCIAL AND INSURANCE ACTIVITIES
448,274
366,285
180.
ADMINISTRATIVE COSTS
(227,255)
(214,855)
 
a) payroll costs
(145,484)
(135,764)
 
b) other administrative costs
(81,771)
(79,091)
190.
NET PROVISIONS FOR RISKS AND CHARGES
(6,379)
(44,812)
200.
IMPAIRMENT ON TANGIBLE ASSETS
(259,052)
(250,572)
210.
IMPAIRMENT ON INTANGIBLE ASSETS
(6,092)
(5,310)
220.
OTHER OPERATING INCOME / CHARGES
409,922
405,799
230.
OPERATING COSTS
(88,856)
(109,750)
280.
TOTAL PROFIT OR LOSS BEFORE TAX FROM CONTINUING OPERATIONS TAX EXPENSE RELATED TO PROFIT OR LOSS FRO
359,418
256,535
290.
TAX EXPENSE RELATED TO PROFIT OR LOSS FROM CONTINUING OPERATIONS TOTAL PROFIT OR LOSS AFTER TAX FROM
(110,330)
(74,060)
300.
TOTAL PROFIT OR LOSS AFTER TAX CONTINUING
249,088
182,475
320.
NET PROFIT OR LOSS
249,088
182,475
330.
MINORITY PORTION OF NET INCOME (LOSS)
(1,480)
(1,326)
340.
HOLDINGS INCOME (LOSS) OF THE YEAR
247,608
181,149
 
 
 
 



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(€/thousands)
 
 
 
 
 
DESCRIPTION
31/12/2015
31/12/2014
10.
Profit (loss) for the year
249,088
182,475
 
Other items of comprehensive income after taxes that will not be reclassified to profit or loss
 
-
40.
Defined-benefit plans
(593)
(7,666)
 
Other items of comprehensive income after taxes that may be reclassified to profit or loss
 
 
80.
Exchange rate differences
27,561
19,742
90.
Cash flow hedge
1,732
(532)
130.
Total other items of comprehensive income after taxes
28,700
11,545
140.
Comprehensive income (loss) (item 10+130)
277,788
194,020
150.
Total comprehensive income (loss) attributable to non - controlling interests
1,480
1,326
160.
Total comprehensive income (loss) attributable to owners of the parents
276,308
192,694
 
 
 
 








CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS OF 31/12/2015 AND 31/12/2014
(€/thousands)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Closing balance at 31/12/2014
Balance at 01/01/2015
Allocation on profit from previous year
Changes during the year
Equity at
 31/12/2015
Equity attributable to Parent Company's shareholders at
31/12/2015
Non-controlling interests at 31/12/2015
Changes in reserves
Equity transactions
Consolidated comprehensive income for 31/12/2015
Reserves
Dividends and other allocations
New share issues
Share buyback
Special dividends paid
Changes in equity instruments
Other changes
Share capital:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
a) common stocks
700,000
700,000
 
 
 
 
 
 
 
 
 
 
700,000
 
b) other stocks
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Share premium reserve
192,746
192,746
 
 
 
 
 
 
 
 
 
 
192,746
 
Reserves:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
a) retained earnings
807,789
807,789
89,573
 
(2,522)
 
 
 
 
 
 
 
894,840
 
b) other
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Valutation reserve
16,880
16,880
 
 
 
 
 
 
 
 
28,700
 
45,580
 
Equity instruments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interim dividends
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Treasury shares
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Profit (loss) for the year
181,149
181,149
(89,573)
(91,576)
 
 
 
 
 
 
247,608
 
247,608
 
Equity
1,913,977
1,913,977
 
(91,576)
(2,526)
 
 
 
 
 
277,788
2,097,663
 
 
Equity attributable to parent Company's shareholders
1,898,564
1,898,564
 
(91,576)
(2,522)
 
 
 
 
 
276,308
 
2,080,774
 
Non- controlling interests
15,413
15,413
 
 
(4)
 
 
 
 
 
1,480
 
 
16,889







(€/thousands)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Closing balance at 31/12/2013
Balance at 01/01/2014
Allocation on profit from previous year
Changes during the year
Equity at
31.12.2014
Equity attributable to Parent Company's shareholders at
31/12/2014
Non-controlling interests at 31/12/2014
Changes in reserves
Equity transactions
Consolidated comprehensive income for 2014
Reserves
Dividends and other allocations
New share issues
Share buyback
Special dividends paid
Changes in equity instruments
Other changes
Share capital:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
a) common stocks
700,000
700,000
 
 
 
 
 
 
 
 
 
 
700,000
 
b) other stocks
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Share premium reserve
192,746
192,746
 
 
 
 
 
 
 
 
 
 
192,746
 
Reserves:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
a) retained earnings
719,746
719,746
141,744
 
 
 
 
 
(53,700)
 
 
 
807,790
 
b) other
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Valutation reserve
5,335
5,335
 
 
 
 
 
 
 
 
11,545
 
16,880
 
Equity instruments
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interim dividends
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Treasury shares
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Profit (loss) for the year
170,330
170,330
(141,744)
(28,586)
 
 
 
 
 
 
181,149
 
181,149
 
Equity
1,802,248
1,802,249
 
(28,586)
(5)
 
 
 
(53,700)
 
194,020
1,913,977
 
 
Equity attributable to parent Company's shareholders
1,788,156
1,788,157
 
(28,586)
-
 
 
 
(53,700)
 
192,694
 
1,898,564
 
Non- controlling interests
14,092
14,092
 
 
(5)
 
 
 
 
 
1,326
 
 
15,413







CONSOLIDATED STATEMENT OF CASH FLOW (DIRECT METHOD)
(€/thousands)
 
 
 
 
31/12/2015
31/12/2014
A. OPERATING ACTIVITIES
 
 
1. Business operations
645,901
579,226
- interest income (+)
781,844
719,533
- interest expense (-)
(299,631)
(340,710)
- fee and commission income (expense) (+/-)
80,114
88,387
- personnel expenses (-)
(131,429)
(127,583)
- Net earned premiums (+)
1,280
1,990
- Other insurance income/expenses (+/-)
3,747
3,607
- other expenses (-)
(370,591)
(413,209)
- other revenue (+)
672,003
721,841
- taxes and levies (-)
(91,436)
(74,630)
2. Cash flows from increase/decrease of financial assets
(2,529,501)
(437,375)
- financial assets held for trading
10,163
23,668
- receivables - due from customers
(1,906,386)
(102,390)
- receivables - due from banks: other credits
(571,676)
(29,035)
- other assets
(61,602)
(329,618)
3. Cash flow from increase/decrease of financial liabilities
2,367,471
199,800
- payables - due to banks: other payables
872,453
(562,205)
- payables - due to customers
295,293
10,728
- notes issued
1,168,265
696,302
- financial liabilities held for trading
(8,134)
(22,503)
- other liabilities
39,594
77,478
Cash flowa generated by/(usedfor) operating activities
483,871
341,651
B. Investing activities
 
 
1. Cash flows generated by
34
-
- disposals/repayments of financial assets held to maturity
34
 
2. Cash flows used for
(392,323)
(259,391)
- purchases of financial assets held to maturity
 
(153)
- purchases of property,plant and equipment
(385,819)
(251,637)
- purchases of intangible assets
(6,504)
(7,601)
Cash generated by / (used for) investing activities
(392,289)
(259,391)
C. FINANCING ACTIVITIES
 
 
- dividend and other distributions
(91,583)
(82,286)
Cash generated by / (used for) financing activities
(91,583)
(82,286)
CASH GENERATED /(USED) DURING THE YEAR
(1)
(26)
 
 
 


RECONCILIATION
 
 
 
 
 
 
31/12/2015
31/12/2014
Cash and cash equivalents - opening blance
22
48
Cash generated (used) during the year
(1)
(26)
Cash and cash equivalents - closing balance
21
22
 
 
 

















NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
PART A - ACCOUNTING POLICIES
A1 - GENERAL INFORMATION
Section 1 - Statement of compliance with International Financial Reporting Standards
The accompanying consolidated financial statements of FCA Bank S.p.A. for the years ended December 31, 2015 and 2014 are being provided pursuant to Rule 3-09 of the United States Securities and Exchange Commission Regulation S-X. These consolidated financial statements are prepared in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”). The designation IFRS also includes International Accounting Standards (“IAS”) as well as all the interpretations of the International Financial Reporting Interpretations Committee (“IFRIC” and “SIC”).
In accordance with Rule 3-09 of Regulation S-X, only the 2015 consolidated financial statements are required to be audited under U.S. Generally Accepted Auditing Standards as 2015 was the only year in which FCA Bank S.p.A. met the conditions of a significant subsidiary under Rule 1-02(w) of Regulation S-X. The consolidated financial statements as of and for the year ended December 31, 2014 are unaudited.
Banca d’Italia, whose powers in relation to the accounts of banks and financial companies subject to its supervision were laid down by Legislative Decree no. 87/92 and confirmed by the above-mentioned Legislative Decree, established the formats of the accounts and the notes used to prepare these financial statements through circular no. 262 of 22 December 2005, as amended. Moreover, the 4th updated version of such circular, issued on 15 December 2015, reflects in particular the changes occurred on credit quality that take effect in relation to the financial statements for the year ended 31 December 2015.
Section 2 - Basis of preparation
The consolidated financial statements consist of the Statement of financial position, the Income statement, the Statement of comprehensive income, the Statement of changes in equity, the Statement of cash flows and the Notes.
The financial statements and the notes show the amounts for the year just ended as well as the comparable amounts at 31 December 2014. The 2014 financial statements, which had been prepared in accordance with the provisions governing financial intermediaries, were recast in accordance with circular no. 262/05 of Banca d’Italia on the formats and rules related to the preparation of banks’ financial statements.
The FCA Bank Group’s consolidated financial statements were prepared in accordance with IAS 1 and the guidelines of Banca d’Italia’s circular no. 262 of 22 December 2005, 4th update of 15 December 2015. In particular:
Formats of the consolidated Statement of financial position, Income statement and notes.
The statement of financial position and the income statement do not contain items with zero balances in the year just ended and in the previous one.
Statement of comprehensive income.





The statement of comprehensive income reflects, in addition to net profit for the year, other items of income and expenses divided between those that can be reverse and those that cannot be reversed to income statement.
Statement of changes in consolidated equity.
The statement of changes in equity shows the composition and changes in equity for the year under review and the comparable period. The items are allocated between the amounts attributable to the Parent Company’s shareholders and non-controlling interests.
Consolidated statement of cash flows.
The Statement of cash flows was prepared with the direct method.
Unit of account.
Amounts in the financial statements and the notes are in thousands of euros.
Going concern, accrual basis and consistency of presentation of financial statements.
The Group is expected to remain viable in the foreseeable future. Accordingly, the financial statements for the year ended 31 December 2015 were prepared on the assumption that the Company is a going concern, in accordance with the accrual basis of accounting and consistent with the financial statements for the previous year.
There were no departures from the application of IAS/IFRSs.

Risks and uncertainties related to the use of estimates
In accordance with IFRSs, management is required to make assessments, estimates and assumptions which affect the application of IFRSs and the amounts of reported assets, liabilities, costs and revenues and the disclosure of contingent assets and liabilities. The estimates and the relevant assumptions are based on past experience and other factors considered reasonable under the circumstances and are adopted to determine the carrying amount of assets and liabilities.
In particular, estimates were made to support the carrying amounts of some of the most significant items of the consolidated financial statements as of 31 December 2015, in accordance with IAS/IFRSs and the above-mentioned provisions. Such estimates concerned largely the future recoverability of the reported carrying amounts in accordance with the applicable rules and based on a going concern assumption.
Estimates and assumptions are revised regularly and updated from time to time. In case performance fails to meet expectations, carrying amounts might differ from original estimates and should, accordingly, be changed. In these cases, changes are recognized through profit or loss in the period in which they occur or in subsequent years.
The main cases where management is required to make subjective assessments include:
recoverability of receivables and, in general, financial assets and the determination of any impairment;
determination of the fair value of financial instruments to be used for financial reporting purposes; in particular, the use of valuation models to set the fair value of financial instruments not traded in active markets;
quantification of employee provisions and provisions for risks and charges;
recoverability of deferred tax assets and goodwill.





Section 3 - Scope and methods of consolidation
The consolidated financial statements as of 31 December 2015 include the accounts of the Parent Company, FCA Bank S.p.A., and its direct and indirect Italian and foreign subsidiaries, as required by IFRS 10.
They reflect also the entities, including structured entities, in relation to which the Parent Company has exposure or rights to variable returns and the ability to affect those returns through power over them.
To determine the existence of control, the Group considers the following factors:
the purpose and design of the investee, to identify the entity’s objectives, the activities that give rise to its returns and how such activities are governed;
to power to understand whether the Group has contractual arrangements which attribute it the ability to govern the relevant activities; to this end, attention is paid only to substantive rights, which provide practical governance capabilities;
the exposure to the investee to determine whether the Group has arrangements with the investee whose returns vary depending on the investee’s performance.
If the relevant activities are governed through voting rights, control may be evidenced by considering potential or actual voting rights, the existence of any arrangements or shareholders’ agreements giving the right to control the majority of the voting rights, to appoint the majority of the members of the board of directors or otherwise the power to govern the financial and operating policies of the entity.
Subsidiaries may include any structured entities, where voting rights are not paramount to determine the existence of control, including special purpose vehicles (SPVs). Structured entities are considered subsidiaries where:
the Group has the power, through contractual arrangements, to govern the relevant activities;
the Group is exposed to the variable returns deriving from their activities.























The Group does not have investments in joint ventures.
The table below shows the companies included in the scope of consolidation.



1.Investments in wholly-owned


NAME
REGISTERED OFFICE
COUNTRY OF INCORPORATION (*)
TYPE OF RELATIONSHIP (**)
SHARING %
FCA Bank S.p.A.
Turin - Italy
 
 
 
Leasys S.p.A.
Turin - Italy
Rome - Italy
1
                                   100.00
FCA Capital France S.A.S.
Trappes - France
 
1
                                   100.00
FCA Fleet Services France SAS
Trappes - France
 
1
                                   100.00
FCA Leasing France SNC
Trappes - France
 
1
                                     99.99
FCA Bank Deutschland GmbH
Heilbronn - Germany
 
1
                                   100.00
FCA Automotive Services UK Ltd
Slough - UK
 
1
                                   100.00
FCA Dealer Services UK Ltd
Slough - UK
 
1
                                   100.00
FCA Fleet Services UK Ltd
Slough - UK
 
1
                                   100.00
FCA Capital Espaňa EFC S.A.
Alcala de Henares - Spain
 
1
                                   100.00
FCA Dealer Services Espaňa S.A.
Alcala de Henares - Spain
 
1
                                   100.00
FCA Capital Portugal IFIC S.A.
Lisbon - Portugal
 
1
                                   100.00
FCA Dealer Services Portugal S.A.
Lisbon - Portugal
 
1
                                   100.00
FCA Capital Suisse S.A.
Schlieren - Switzereland
 
1
                                   100.00
FCA Leasing Polska Sp. Zo.o.
Warsaw - Poland
 
1
                                   100.00
FCA-Group Bank Polska SA
Warsaw - Poland
 
1
                                   100.00
FCA Capital Nederland B.V.
Lijnden - Netherlands
 
1
                                   100.00
FCA Capital Danmark A/S
Glostrup - Denmark
 
1
                                   100.00
FCA Capital Belgium S.A.
Auderghem - Belgium
 
1
                                     99.99
FCA Bank GmbH
Vienna - Austria
 
2
                                     50.00
FCA Leasing GmbH
Vienna - Austria
 
1
                                   100.00
FCA Capital Hellas S.A.
Athens - Greece
 
1
                                     99.99
FCA Insurance Hellas S.A.
Athens - Greece
 
1
                                     99.99
FCA Capital Ireland Plc
Dublin - Ireland
 
1
                                     99.99
FCA Capital Re Limited
Dublin - Ireland
 
1
                                   100.00
FCA Capital Sverige AB
Sweden
 
1
                                   100.00
Athomstart Invest 35
Norway
 
1
                                   100.00
 
 
 
 
 
(*) If different from Registered Office
 
 
(**) Relation Type:
1 = majority of voting rights at ordinary meetings
2 = dominant influence at ordinary meeting
 
 
 
On 13 January, 2016, Fal Fleet Services SAS changed its name to FCA Fleet Services France SAS.
 












The structured entities related to securitization transactions, whose details are provided below, are fully consolidated:
NAME
COUNTRY
A-BEST THIRTEEN FT
Madrid - Spain
A-BEST TWELVE S.r.l.
Conegliano (TV) - Italy
A-BEST ELEVEN UG
Frankfurt am Main - Germany
A-BEST TEN S.r.l.
Conegliano (TV) - Italy
A-BEST NINE S.r.l.
Conegliano (TV) - Italy
A-BEST EIGHT PLC
London - Uk
A-BEST SEVEN S.r.l.
Milan - Italy
A-BEST FOUR S.r.l.
Conegliano (TV) - Italy
Nixes Three Plc
Dublin - Ireland
Nixes Four S.r.l.
Milan - Italy
Nixes Six PLc
Londra - Uk
Nixes Five Ltd
Island of Jersey
FCT Fast 2
Courbevoie - France
Fast 3 S.r.l.
Milan - Italy
Erasmus Finance Limited
Dublin - Ireland



2.Investments in subsidiaries with significant non-controlling interests

Non-controlling interests, availability of non-controlling interests’ voting rights and dividends paid to non-controlling interests

Name
Non-controlling interests (%)
Availability of non-controlling interests’ voting rights (%)
Dividends distributed to non-controlling interests
FGA BANK GMBH (Austria)
50%
50%
-


Pursuant to IFRS 10, FGA Bank GmbH (Austria), a 50%-held subsidiary, is fully consolidated because FCA Bank S.p.A. exercises a dominant influence.
Investments in subsidiaries with significant non-controlling interests
The table below provides financial and operating highlights of FGA Bank Gmbh before intercompany eliminations required by IFRS 12:

 
(amounts in thousands of euros)
 
 
 
 
FCA BANK GMBH (AUSTRIA)
31/12/2015
31/12/2014

Total assets
170,960
146,631

Financial assets
170,079
145,340

Financial liabilities
140,099
117,225

Equity
28,763
26,874

Net interest income
3,462
3,102

Net fee and commission income
685
665

Banking income
4,147
3,767

Net result from investment activities
3,837
3,349

Net result from investment and insurance activities
3,837
3,349

Operating costs
(1,319)
(1,215)

Profit (loss) before taxes from continuing operations
2,518
2,134

Net profit (loss) for the period
1,881
1,623

 
 
 







Consolidation methods
In preparing the consolidated financial statements, the financial statements of the parent company and its subsidiaries, prepared according to IAS/IFRSs, are consolidated on a line-by-line basis by adding together like items of assets, liabilities, equity, income and expenses.
The carrying amount of the parent’s investment in each subsidiary and the corresponding portions of the equity of each such subsidiary are eliminated.
Any difference arising during this process - after the allocation to the assets and liabilities of the subsidiary - is recognized as goodwill on first time consolidation and, subsequently, among other reserves.
The share of net profit pertaining to non-controlling interests is indicated separately, so at to determine the amount of net profit attributable to the parent company’s shareholders.
Assets, liabilities, costs and revenues arising from intercompany transactions are eliminated.
The financial statements of the Parent Company and those of the subsidiaries used for the consolidated financial statements are all as of the same date.
For foreign subsidiaries which prepare their accounts in currencies other than the euro, assets and liabilities are translated at the exchange rate prevailing on the balance sheet date while revenues and costs are translated at the average exchange rate for the period.
Exchange differences arising from the conversion of costs and revenues at the average exchange rate and the conversion of assets and liabilities at the reporting date are reported in profit or loss in the period.
Exchange differences arising from the equity of consolidated subsidiaries are recognized in other comprehensive income and reversed to profit and loss when loss of the subsidiaries’ control occurs.
The exchange rates used to translate the financial statements at 31 December 2015 are as follows:

 
 31/12/2015
Medium 31/12/2015
31/12/2014
Medium 31/12/2014
Polish Zloty (PLN)
4,264
4,184
4,273
4,184
Danish Crown(DKK)
7,463
7,459
7,445
7,455
Swiss Franc (CHF)
1,084
1,068
1,202
1,215
GB Pound (GBP)
0,734
0,726
0,779
0,806
Norwegian Krone (NOK)
9,603
8,948
 
 
Svedish Krona (SEK)
9,190
9,353
 
 

Other information
To prepare the consolidated financial statements use was made of the following::
draft financial statements at 31 December 2015 of the Parent Company FCA Bank S.p.A.;
accounts as of 31 December 32015, approved by the competent bodies and functions, of the other fully consolidated companies, as adjusted to take into account the consolidation process and, where necessary, to comply with the Group’s accounting policies.
Section 4 - Subsequent events
No events occurred after the balance sheet date which should result in adjustments of the consolidated financial statements as of 31 December 2015. A description of the most significant events occurred after the balance sheet date is provided in the specific section in the Report on operations.





Section 5 - Other information
The consolidated financial statements and the Parent Company’s financial statements were audited by Reconta Ernst&Young S.p.A. pursuant to Legislative Decree no. 39 of 27 January 2010.

ACCOUNTING STANDARDS, AMENDMENTS AND INTERPRETATIONS NOT YET MANDATORILY APPLICABLE AND NOT ADOPTED EARLY BY THE GROUP AT 31 DECEMBER 2015
 
 
 
 
Standard/amendment
Date of publication
Date of application
Description of standard/amendment
Recognition of Deferred Tax Assets for Unrealised Losses (amendment to IAS 12)
19 January 2016
1 January 2017
IASB clarifies the accounting treatment of deferred tax assets related to debt instruments measured at fair value.
IFRS 15 - Revenue from Contracts with Customers
28 May 2014
1 January 2017
The objective of IFRS 15 is to establish a new revenue recognition model which will apply to all contracts entered into with customers except those that fall within the scope of other IFRSs/IAS, such as leases, insurance contracts and financial instruments. The key steps to account for revenue according to the new model include:
- identify the contract(s) with the customer;
- identify the performance obligations of the contract;
- determine the transaction price;
- allocate the transaction price to the performance obligations in the contract;
- recognize revenue when (or as) the entity satisfies a performance obligation.
 
 
IFRS 16 - Leases
13 January 2016
1 January 2019
The new standard constitutes an innovation in that it established that leases be reported in entities' balance sheets, thus enhancing the visibility of their assets and liabilities.
IFRS 16 repeals the distinction between operating leases and finance leases (for the lessee), requiring that all lease contracts be treated as finance leases.
Short-term contracts (12 months) and those involving low value items (e.g. personal computers) are exempted from this treatment.
The new standard will take effect on 1 January 2019, Early adoption is permitted provided that also IFRS 15, Revenue from Contracts with Customers, is applied.












Standard/amendment
Date of publication
Date of application
Description of standard/amendment
IFRS 9 - Financial instruments
24 July 2014
1 January 2018
The document reflects the results of the phases related to classification and measurement, impairment and hedge accounting of IASB's plan to replace IAS 39. The standard introduces new criteria to classify and measure financial assets and liabilities. In particular, for the financial assets the new standard uses a single approach based on the management of financial instruments and the characteristics of the contractual cash flows of the financial assets to determine their measurement method, replacing the different methods provided for by IAS 39.
 
 
 
 
 
On the other hand, for financial liabilities the main change concerns the accounting treatment of changes in the fair value of a financial liability designated as a financial liability recognized at fair value through profit or loss, in case these changes are due to changes in the issuer's credit rating at fair value. Under the new standard, these changes must be recognized through other comprehensive income and no longer through profit or loss.
 
 
 
 
 
 
With reference to the impairment model, the new standard requires loan loss estimates be made on the basis of the expected loss model (not on the incurred loss model) using supportable information, available without unreasonable costs or efforts that would include historical, current and prospective data. The standard requires that this model be applied to all financial instruments, tat is to all financial assets measured at amortized cost, to those recognized at fair value through other comprehensive income, to receivables arising from rental contracts and to trade receivables.
 
 
 
 
 
 
Lastly, the standard introduces a new model of hedge accounting to modify the requirements of the current IAS 39, which sometimes are considered too strict and unsuited to reflect entities' risk management policies. The main developments of the document concern:
- increase in the number of transactions eligible for hedge accounting, including also the risks of non-financial assets/liabilities eligible for hedge accounting treatment;
- change of accounting treatment of forward contracts and options when they are embedded in a hedge accounting relationship, to reduce the volatility of the income statement;
- amendments to the effectiveness test by replacing the current procedure based on the 80%-125% range with the concept of "economic relationship" between hedged item and hedging instrument. A retrospective assessment of effectiveness of the hedging relationship will no longer be required.
 
 
 


A.2 - MAIN ITEMS IN THE FINANCIAL STATEMENTS
This section shows the accounting policies adopted to prepare the consolidated financial statements as of 31 December 2015. Such description is provided with reference to the recognition, classification, measurement and derecognition of the different assets and liabilities.
1.
Held-for-trading financial assets
This item includes financial assets held in the trading portfolio, reflecting essentially the positive value of derivative contracts not designated as hedging instruments.
Derivatives are recognized as assets if their fair value is positive and as liabilities if their fair value is negative. Assets and liabilities arising from transactions with the same counterparty can be offset only if there is the legally enforceable right to offset the amounts recognized and the parties intend to settle on a net basis (see IAS 32).





No reclassifications to other financial asset categories are permitted, save for the existence of unusual events that can hardly take place again in the short term. In these cases, debt and equity instruments that are no longer held for trading can be reclassified only for in particular situations, under IAS 39 (Financial assets held to maturity, Available for sale financial assets, Receivables). These assets are transferred at their fair value at the time of reclassification.
Initial recognition takes place on the date of settlement for debt and equity instruments and on the execution date for derivative contracts. Held-for-trading assets are initially recognized at their fair value, which is normally the price paid, without considering transaction costs and income attributable to the instrument.
After initial recognition, held-for-trading financial assets and liabilities are measured at their fair value. Any changes in fair value are recognized through profit or loss under item 80. “Net result of trading activities”.
The fair value of derivative contracts quoted in an active market is determined on the basis of the market value of such contracts at the end of the period. In the absence of an active market, use is made of estimation methods and valuation models that take into account the risk factors associated to the instruments and based on market data, such as interest rates. Equity instruments, units of UCITS and derivatives with equity instruments as underlying not quoted in an active market, for which the fair value cannot be determined reliably according to the above guidelines, are reported at cost.
Held-for-trading financial assets and liabilities are derecognized when the contractual rights to the cash flows deriving therefrom expire or when the financial asset or liability is sold, substantially transferring all related risks and rewards.
2.
Available-for-sale financial assets
These are financial assets other than derivatives which are not classified as receivables, financial assets held to maturity or assets recognized at their fair value. These assets are held for an indefinite period of time and can be sold to generate liquidity or to meet changes in interest rates, exchange rates and prices.
Available-for-sale financial assets include money market, debt and equity instruments; they include non-controlling equity interests that do not quality as investments in subsidiaries, joint ventures or associated companies.
Debt and equity instruments are recognized as financial assets on the settlement date while receivables are recognized on the disbursement date.
Financial assets are initially recognized at their fair value, including transaction costs and income attributable directly to the instrument. Financial assets reclassified from Financial assets held to maturity are initially recognized at their fair value at the time of transfer.
Subsequently, Available-for-sale financial assets are measured at their fair value. Interest, calculated with the amortized cost method is recognized in the income statement while changes in fair value are recognized through equity, in item 140 “Valuation reserve”. Changes in fair value are reported also in the Statement of comprehensive income.
Fair value is determined on the basis of the criteria already illustrated for held-for-trading financial assets. Equity instruments not quoted in an active market and whose fair value cannot be determined due to lack of reliable information are recognized at cost, which reflects the latest reliably measured fair value.
Tests to determine the existence of objective evidence of impairment are conducted on year-end or interim reporting dates. In the presence of such objective evidence, the amount of the loss is measured as the difference between the carrying amount of the asset and the present value of the estimated cash flows, as discounted at the original effective interest rate. Impairment losses are reported in item 130.b) “Impairment/reinstatement of value of available-for-sale financial assets”.
If the reasons of the impairment no longer apply, following an event occurred after the recognition of the relevant loss, value is reinstated through profit or loss, in the case of debt instruments, and through equity, in the case of equity instruments. The amount of the reinstatement cannot, under any circumstance, exceed the amortized cost that the instruments would have had in the absence of previous impairments.
In case of disposal of the financial asset, cumulative gains and losses are released to the income statement to item 100.b) “Gains (losses) on disposal or buyback of available-for-sale financial assets”.





3.
Financial assets held to maturity
Held-to-maturity investments are non-derivative financial assets that have either fixed or determinable payments and a fixed maturity - other than those that can be classified as loans to banks or loans to customer - and for which there is the ability and the intention to hold to maturity.
If during the year a significant amount of such investments is sold or reclassified, before their maturity, the remaining financial assets held to maturity would be reclassified as available-for-sale financial assets and use of this category would be precluded for the following two years, unless the sales or reclassifications:
are so close to the maturity date or the date of the option for the repayment of the financial asset that interest rate fluctuations would not have a significant effect on the fair value of the asset;
take place after the collection of substantially all the original capital of the financial asset through planned or advance repayments;
are attributable to an isolated, uncontrollable event that is not recurring and could not be reasonably predicted.
Initial recognition of these financial instruments takes place at the settlement date. Financial assets held to maturity are initially recognized at their fair value, including any income and cost attributable directly. Subsequently, they are measured at amortized cost by using the effective interest rate method.
Gains or losses related to financial assets held to maturity are recognized through profit or loss when such assets are derecognized or impaired or through the amortization of the difference between the initial carrying amount and the amount repayable at maturity.
Tests to determine the existence of objective evidence of impairment are conducted on year-end or interim reporting dates. In the presence of such objective evidence, the amount of the loss is measured as the difference between the carrying amount of the asset and the present value of the estimated cash flows, as discounted at the original effective interest rate. Impairment losses are reported in item 130.c) “Impairment/reinstatement of value of financial assets held to maturity”.
If the reasons of the impairment no longer apply, following an event occurred after the recognition of the relevant loss, value is reinstated through profit or loss. The amount of the reinstatement cannot, under any circumstance, exceed the amortized cost that the instruments would have had in the absence of if no loss had been recorded.
Financial assets held to maturity are derecognized when the contractual rights to the cash flows deriving therefrom expire or when the financial asset is sold, substantially transferring all related risks and rewards. In case of disposal/derecognition of the financial asset, cumulative gains and losses are released to the income statement to item 100.c) “Gains (losses) on disposal or buyback”.
4.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market, and are not recognized as “Assets held for trading” or designated as “Available-for-sale assets” or “Assets held to maturity”.
“Loans to customers” include receivables originated from instalment loans, finance leases and loans disbursed, in connection with the factoring business, on a recourse basis. Regarding receivables sold on a non-recourse basis, these are reported in the presence of contractual clauses that do not transfer substantially the relevant risks and rewards.
Lease agreements are classified as finance leases whenever the relevant term and conditions are such as to transfer substantially all the risks and benefits of ownership from the lessor to the lessee. All the other leases are operating leases. The amounts due from lessees under finance leases are recognized as receivables for the amount of the Group’s investment in the leased assets.
Loans and receivables are recognized initially upon disbursement.
Upon initial recognition, loans and receivables are recorded at face value, which is typically the amount of the sum disbursed, including income and costs directly attributable to the single loan or receivable and determinable since inception of the transaction, even though the relevant monetary amount is collected or paid subsequently.
Subsequently, loans and receivables are measured at amortized cost, or the difference between their carrying amount on initial recognition - as increased or decreased for any principal repayment, impairments or reinstatements - and the amortization, calculated with the effective interest rate, of the difference between the amount disbursed and that due at maturity, taking into account costs or income directly attributable to the individual loan or receivable. The effective interest rate is equal to the discount rate that sets the present value of the future cash flows of the





loan or receivable, in terms of principal and interest, equal to the amount disbursed less any cost/income attributable to the loan or receivable. This accounting treatment, based on a cash flow rationale, makes it possible to distribute the effects of costs/income throughout the terms to maturity of the loan or receivable. Short-term loans or receivables, which are not impacted by any time effect, are reported at their initial carrying amount.
Gains and (losses) on loans are recognized through profit or loss:
when the financial asset in question is derecognized, in item 100.a) “Gains (losses) on loan or receivable disposals”; or:
when the financial asset is impaired (or when the original value is reinstated), in item 130.a) “Impairment/reinstatement of value due to impairment of loans or receivables”.
Interest earned on loans or receivables are recognized in item 10. “Interest and similar income” and is recognized in accordance with the effective interest rate method as apportioned throughout the remaining term of the loan.
The carrying amount of loans and receivables is tested from time to time for recoverability through an analysis designed to identify those that, following the occurrence of events after their disbursement, show objective evidence of possible impairment. These include loans or receivables classified as non-performing, non-accruing, restructured or past due, in accordance with the rules enacted by Banca d’Italia in force at 31 December 2015, consistent with IAS/IFRS.
These deteriorated loans and receivables are evaluated individually and the amount of the adjustment for each is equal to the difference between its carrying amount upon initial recognition (amortized cost) and the present value of future cash flows, as discounted at the original effective interest rate.
Loans and receivables for which no objective evidence of impairment has been gathered individually are tested for any collective impairment. The evaluation is carried out by grouping these loans and receivables by consistent credit risk categories and the loss percentage are estimated taking into account the time series of the losses associated with each category.
The losses are recognized through profit or loss. If an impaired loan or receivable is recovered, the amount is recognized as a debit to “Impairment losses due to credit deterioration”.
The full or partial write-off of an uncollected loan or receivable takes place when such loan or receivable is considered as definitely irrecoverable. The loss is recognized in the income statement less any previous impairment losses taken.
Deteriorated loans are derecognized only if the sale entailed the substantial transfer of all related risks and rewards. By contrast, when the risks and rewards of the loans or receivables sold have not been transferred, these continue to be reported on the balance sheet, even though ownership of the loan or the receivable has been transferred. In the event that the substantial transfer of risks and rewards cannot be ascertained, the loans or receivables are derecognized whenever no type of control has been maintained over them. By converse, keeping control, in whole or in part, involves the on-balance-sheet recognition on the balance sheet of the loans or receivables for the balance outstanding, as measured by the exposure to changes in value of the loans or receivables sold and the changes in the relevant cash flows. Lastly, loans or receivables sold are derecognized whenever the contractual rights to receive the related cash flows are maintained whenever the entity is required to pay such cash flows to a third party.
Deteriorated loans or receivables
Deteriorated exposures - i.e. those with the features outlined in paragraphs 58-61 of IAS 39 - are classified in the categories listed below, in accordance with Banca d’Italia’s guidance contained in Circular no. 272 of 30 July 2008 as amended:
non-performing: the total amount of cash and off-balance-sheet exposure toward an entity in a state of insolvency (including in the absence of a court ruling) or in substantially similar situations, regardless of any loss forecasts by the bank. This category does not include any deterioration determined by country risk. The assessment is generally made on an individual basis.
probable defaults (“unlikely to pay”): the total amount of cash and off-balance-sheet exposure which does not qualify as non-performing but which are considered as unlikely to be repaid (in terms of principal or interest), absent any action such as calling on guarantees, by the





borrower. This assessment is generally made regardless of any past due amount or installment. Probable defaults are generally assessed on an individual basis or by applying a pre-set percentage to the various credit risk categories.
Past due and/or excess exposures: these are cash exposures other than those classified as non-performing or probable defaults that, at the reporting date, are either past due or exceed approved credit limits. Past due and/or excess exposures can be determined by reference to either the individual borrower or the individual transaction.


Securitized receivables
Certain Group companies participate in receivable securitization programs as sellers and subscribers of bonds issued under these programs.
Securitization transactions involve the sale on a non-recourse basis of a receivable portfolio to a vehicle company, which in turn finances the purchase of these receivables by issuing asset-backed securities, that is bonds whose repayment of principal and interest depend on the cash flow generated by the receivable portfolio.
Asset-backed securities are ranked by seniority and rating, with the senior placed in the market with investors while the junior notes, which are subordinated to senior notes in priority of repayment, are placed with companies of the FCA Group.
According to IFRS 10, vehicles are included in the scope of consolidation, as the placement of junior asset-backed securities and participation of the originator in the set-up of the program, imply control over the SPE.
5.
Hedging transaction
Hedging transactions are intended to offset potential losses on a specific item or group of items, attributable to a specific risk, through the gains generated on another instrument or group of instruments in the event that the specific risk in question materializes. The FCA Bank Group hedges its exposure to the interest rate risk associated with receivables arising from installment loans and bonds issued with derivatives designated as fair value hedges. Derivatives entered into to hedge the interest rate risk associated with the debt of the companies engaged in long-term rental are designated as cash flow hedges..
Only derivatives entered into with a counterparty not belonging to the Group may be treated as hedging instruments.
Hedging derivatives are stated at fair value. Specifically:
in the case of cash flow hedges, derivatives are recognized a their fair value. Any change in the fair value of the effective part of the hedge is recognized through equity, in item 140. “Valuation reserve” while any change in the fair value of the ineffective part of the hedge is recognized through profit or loss in item 90. “Net result of hedging activities”;
in the case of fair value hedges, any change in the fair value of the hedging instrument is recognized through profit or loss in item 90. “Net result of hedging activity”. Any change in the fair value of the hedged instrument, attributable to the risk hedged with the derivative instrument, is recognized through profit and loss as an offsetting entry of the change in the carrying amount of the hedged item;
The fair value of derivative instruments is calculated on the basis of interest and exchange rates quoted in the market, taking into account the counterparties’ creditworthiness, and reflects the present value of the future cash flows generated by the individual contracts.
Gains or losses on derivatives hedging interest rate risk are allocated either to “Interest and similar income” or “Interest and similar expenses”, as the case may be.
A derivative contract is designated for hedging activities if there is a formal document of the relationship between the hedged instrument and the hedging instrument and whether the hedge is effective since inception and, prospectively, throughout its life.
A hedge is effective (in a range between 80% and 125%) when the changes in the fair value (or cash flows) of the hedging financial instrument almost entirely offset the changes in hedged item with regard to the risk being hedged.
Effectiveness is assessed at every year-end or interim reporting date by using:





prospective tests, to demonstrate an expectation of effectiveness in order to qualify for hedge accounting;
retrospective tests, to ensure that the hedging relationship has been highly effective throughout the reporting period, measuring the extent to which the achieved hedge deviates from a perfect hedge.
If the tests fail to demonstrate hedge effectiveness, hedge accounting, as indicated above, is discontinued and the derivative contract is reclassified to held-for-trading financial assets and is therefore measured in a manner consistent with its classification. In case of macro hedging, IAS 39 permits the establishment of a fair value hedge for the interest rate risk exposure of a designated amount of financial assets or liabilities so that a group of derivative contracts can be used to offset the changes in fair value of the hedged items as interest rates vary.
Macro hedges cannot be applied to differences between financial assets and liabilities.
Macro hedging is considered highly effective if, like fair value hedges, at inception and in subsequent periods the changes in fair value of the hedged amount are offset by the changes in fair value of the hedging derivatives in the range of 80% to 125%.
6.
Investments
Investments in joint ventures (IFRS 11) as well as in companies subject to significant influence (IAS 28) are recognized with the equity method.
Investments in companies that are not subsidiaries or associated companies, and are unlisted, are reported at cost.
If there is any evidence that the value of an investment has been impaired, the recoverable value of the investment is estimated, taking account the present value of the future cash flows that it will generate, including its disposal value.
If the recovery value is lower than book value, the difference is recorded in the income statement.
In subsequent periods, if the reasons for the impairment cease to exist, the original value may be restored through the income statement.
7.
Tangible assets
This item includes furniture, fixtures, technical and other equipment and assets related to the leasing business.
These tangible assets are used to provide goods and services, to be leased to third parties, or for administrative purposes and are expected to be utilized for more than one period.
This item consists of:
assets for use in production;
assets held for investment purposes.
Assets held for use in production are utilized to provide goods and services as well as for administrative purposes and are expected to be used for more than one period. Typically, this category includes also assets held to be leased under leasing arrangements.
This item includes also assets provided by the Group in its capacity as lessor under both finance lease agreements operating lease agreements. Assets leased out include vehicles provided under operating lease agreements by the Group’s long-term car rental companies. Trade receivables to be collected in connection with recovery procedures in relation to operating leases are classified as “Other assets”. Operating lease agreements with a buyback clause are also included in “Other assets”.
Tangible assets comprise also leasehold improvements, whenever such expenses are value accretive in relation to identifiable and separable assets. In this case, classification takes place in the specific sub-items of reference in relation to the asset.
Assets held for investment purposes refer to investment property under IAS 40, that is to real estate held (owned or under finance lease arrangements) to generate rental income and/or to achieve a capital gain.
Tangible assets are initially recognized at cost, inclusive of purchase price and all the incidental charges incurred directly to purchase and to put the asset in service. Costs incurred after purchase are only capitalized if they lead to an increase in the future economic benefits deriving from the asset to which they relate. All other costs are recorded in the income statement as incurred.
Subsequently, tangible assets are recognized at cost, minus accumulated depreciation and impairment losses. Depreciation is calculated on a straight line basis considering the remaining useful life and value of the asset.





At every reporting date, if there is any evidence that an asset might be impaired, the book value of the asset is compared with its realizable value - equal to the higher of fair value, net of any selling costs, and the value in use of the asset, defined as the net present value of future cash flows generated by the asset. Any impairment losses and adjustments are recorded in the income statement, item 200 “Impairment/reinstatement of tangible assets”.
If the reasons that gave rise to the impairment no longer apply, then the loss is reversed for the amount that would restore the asset to the value that it would have had in the absence of any impairment, minus depreciation.
Initial direct costs incurred in the negotiation and execution of an operating agreement are added to the leased assets in equal installments, based on the length of the agreement.
Tangible assets are unrecognized upon disposal or when they are retired from production and no further economic benefits are expected from them. Any difference between the selling price or realizable value and the carrying amount is recognized through profit or loss, item 270 “Gains (losses) from the sale of investments”.
8.
Intangible assets
Intangible assets are non-monetary long-term assets, identifiable even though they are intangible, controlled by the Group and which are likely to generate future economic benefits.
Intangible assets include mainly goodwill, software, trademarks and patents.
Goodwill reflects the positive difference between purchase price and fair value of the assets and liabilities acquired in a business combination.
In the case of software generated internally the costs incurred to develop the project are recognized as intangible assets provided that the following conditions are met: technical feasibility, intention to complete, future usefulness, availability of sufficient technical and financial resources and the ability to measure reliably the costs of the project.
Intangible assets are recognized if they are identifiable and originated from legal or contractual rights.
Intangible assets purchased separately and/or generated internally are initially recognized a cost and, except for goodwill, are amortized on a straight line basis over their remaining useful life.
Subsequently, they are recognized net of accumulated amortization and any accumulated impairment losses. The useful life of intangible assets is either definite or indefinite.
Definite-life intangibles are amortized over their remaining useful life and are tested for impairment every time there is objective evidence of a possible loss of value. The amortization period and method of a definite-life intangible asset are reviewed at least once every year, at year end. Changes in the useful life and the manner in which the future economic benefits related to the asset will materialize result in changes in the amortization period or amortization method, as the case may be, and are considered as changes in estimates. The amortization of definite-life intangible asset is recognized in the income statement in the cost category consistent with the function of the intangible asset.
Indefinite-life intangible assets, including goodwill, are not amortized but are tested every year for impairment both individually and at the level of cash generating units. Every year (or whenever there is evidence of impairment) goodwill is tested for impairment. To this end, the cash generating unit to which goodwill is to be attributed is identified. The amount of any impairment is calculated as the difference between the carrying amount of goodwill and its recoverable value, if lower. Recoverable value is equal to the higher of the fair value of the cash generating unit, less any selling costs, and the relevant value in use. Any adjustments are recognized in the income statement, item 260.
“Goodwill impairment”. No reinstatement of value is permitted for goodwill.
Intangible assets are derecognized upon disposal or when and no further economic benefits are expected from them. Any difference between the selling price or realizable value and the carrying amount is recognized through profit or loss, item 270 “Gains (losses) from the sale of investments”.
9.
Current and deferred taxation
Deferred tax assets and liabilities are recognized on the balance sheet of the consolidated financial statements in items 140.
“Tax assets” and 80. “Tax liabilities”.
Under the «Balance sheet method», current and deferred taxes include:
current tax assets, that is payments in excess of tax obligations to be fulfilled in accordance with the applicable law;





current tax liabilities, that is tax obligations to be fulfilled in accordance with the applicable law;
deferred tax assets, that is income tax amounts recoverable in future years and related to:
deductible temporary differences;
carryforwards of unused tax losses; and
carryforwards of unused tax credits;
deferred tax liabilities, that is income tax amounts due in future years in relation to temporary taxable differences.
Current and deferred tax assets and liabilities are calculated in accordance with applicable national tax laws and are accounted as an expense (income) in accordance with the accrual basis of accounting and matching cost principle applicable to the costs and income that originated them.
Generally, deferred tax assets and liabilities arise whenever a cost is deductible or income is taxable in a period other than that in which they are recognized.
Deferred tax assets and liabilities are recognized on the basis of the tax rates that, at the balance sheet date, are expected to be applicable in the year in which the asset will be realized or the liability extinguished, on the basis of the tax legislation in force, and are periodically revised to take account of any change in legislation.
Deferred tax assets are recognized, to the extent that they can be recovered against future income. In accordance with IAS 12, the probability that there is sufficient taxable income in future should be verified from time to time. If the analysis reveals that there is no sufficient future income, the deferred tax assets are reduced accordingly.
Current and deferred taxes are recognized in the income statement, item 290 “Income tax on continuing operations”, with the exception of those taxes related to items recognized, in the current or in another year, directly through equity, such as those related to gains or losses on available-for-sale financial assets and those related to changes in the fair value of cash flow hedges, whose changes in value are recognized, on an after-tax basis, directly in the statement of comprehensive income in the “Valuation reserve”.
Current tax assets are shown in the balance sheet net of current tax liabilities whenever the following conditions are met:
existence of an enforceable right to offset the amounts recognized; and
the parties intend to settle the assets and liabilities in a single payment on a net basis or to realize the asset and simultaneously extinguish the liability.
Deferred tax assets are reported in the Statement of financial position net of deferred tax liabilities whenever the following conditions are met:
existence of a right to offset the underlying current tax assets with current tax liabilities; and
both deferred tax assets and liabilities relate to income taxes applied by the same tax jurisdiction on the same taxable entity, or on different taxable a intend to settle the current tax assets and liabilities on a net basis (typically in the presence of a tax consolidation agreement).
10.
Provisions for risks and charges
Post-employment benefits and similar obligations
Post-employment benefits are established in accordance with labour agreements and are qualified as defined-benefit plans.
Obligations associated with employee defined-benefit plans and the relevant pension costs associated to current employment are recognized based on actuarial estimates by applying the projected unit credit method. Actuarial gains/losses resulting from the valuation of the liabilities of the defined-benefit plan are recognized through equity in the “Valuation reserve”.
The discount rate used to calculate the present value of the obligations associated with post-employment benefits changes depending on the country/currency in which the liability is denominated and is set on the basis of yields, at the balance sheet date, of bonds issued by prime corporates with an average maturity consistent with that of the liability.
Other provisions
Other provisions for risks and charges relate to costs and charges of a specified nature and existence certain or probable but whose amount or date of payment is uncertain on the balance sheet date. Provisions for risks and charges are made solely whenever:





a) there is a current (legal or constructive) obligation as a result of a past event;
b) fulfillment of this obligation is likely to be onerous;
c) the amount of the liability can be reliably estimated.
When the time value of money is significant, the amount of a provision is calculated as the present value of the expenses that will supposedly be incurred to extinguish the obligation.
This item includes also long-term benefits to employees whose expenses are determined with the same actuarial criteria as those of the defined-benefit plans. Actuarial gains or losses are all recognized as incurred through profit or loss.
11.
Debts, securities outstanding and other liabilities
The items Bank borrowings, due to customers and Securities outstanding, include the financial instruments (other than financial liabilities held for trading and recognized at their fair value) issued to raise funds from external sources. In particular, securities outstanding reflect bonds issued by Group companies and securities issued by the SPEs in relation to receivable securitization transactions.
These financial liabilities are recognized on the date of settlement at fair value, which is normally the amount collected or the issue price, less any transaction costs directly attributable to the financial liability. Subsequently, these instruments are recognized at their amortized cost, on the basis of the effective interest method. The only exception is short-term liabilities, as the time factor is negligible, which continue to be recognized on the basis of the amount collected.
Financial liabilities are unrecognized when they reach maturity or are extinguished. Derecognition takes place also in the presence of a buyback of previously issued securities. The difference between the carrying amount of the liability and the price paid to buy it back is recognized through profit or loss, item 100.d) “Gains (Losses) on buyback of financial liabilities”.
12.
Financial liabilities held for trading
Financial liabilities held for trading include mainly derivative contracts that are not designated as hedging instruments.
These financial liabilities are recognized initially at their fair value initially and subsequently until they are extinguished, with the exception of derivative contracts to be settled with the delivery of an unlisted equity instrument whose fair value cannot be determined reliably and that, as such, are recognized at cost.
13.
Insurance assets and liabilities
IFRS 4 defines insurance contracts as contracts under which one party (the insurer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder (or a party designated by the policyholder) if a specified uncertain future event (the insured event) adversely affects the policyholder.
The Group’s insurance activity concerns the reinsurance of life and non-life insurance policies sold by insurance companies to customers of consumer credit companies to protect the payment of the debt.
The items described below reflect, as prescribed by paragraph 2 of IFRS 4, the operating and financial effects deriving from the reinsurance contracts issued and held.
In essence the accounting treatment of such products calls for the recognition:
in items 150. “Net premiums” and 160. “Income (losses) from insurance activities” of the income statement, (i) of the premiums, which include the premiums written for the year following the issue of contracts, net of cancellations; (ii) changes in technical provisions, reflecting the variation in future obligations toward policyholders arising from insurance contracts; (iii) commissions for the year due to intermediaries; (iv) cost of claims, redemptions and expirations for the period;
in item 130. “Technical provisions”, on the liability side, of the obligations toward policyholders, calculated individually for every contract with the prospective method, on the basis of demographic/financial assumptions currently used by the industry;
in item 110. “Technical provisions ceded to reinsurers”, on the asset side, the obligations attributable to reinsurers.
14.
Other information
Employee Severance Fund





The FCA Bank Group has established different defined-benefit and defined-contribution pension plans, in line with the conditions and practices in the countries in which it carries out its activities.
In Italy, the Employee Severance Fund is treated as “post-employment benefits”, classified as:
“defined-contribution plan” for the severance amounts accrued to employees as of 1 January 2007 (effective date of Legislative Decree no. 252 on the reform of supplementary pension funds), both in case the employee exercised the option to allocate the sums attributable to him/her to supplementary pension funds and in case the employee opted for the allocation of these sums to INPS’s Treasury fund. For these sums, the amount accounted for as personnel expenses is determine on the basis of the contributions due without applying actuarial calculation methods;
“defined-benefit plan”, recognized on the basis of its actuarial value as determined by using the projected credit unit method, for the severance amounts accrued until 31 December 2006. These amounts are recognized on the basis of their actuarial value as determined by using the projected credit unit method. To discount these amounts to present value, the discount rate was determined on the basis of yields of bonds issued by prime corporates taking into account the average remaining duration of the liability, as weighted by the percentage of any payment and advance payment, for each payment date, in relation to the total amount to be paid and paid in advance until the full amount of the liability is extinguished.
Costs related to the employee severance fund are recognized in the income statement, item no. 180.a) “Administrative expenses: personnel expenses” and include, for the part relating to the defined-benefit plan (i) service costs related to companies with less than 50 employees; (ii) interest cost accrued for the year, for the defined-contribution part; (iii) the severance amounts accrued in the year and credited to either the pension funds or to INPS’s Treasury fund.
On the Statement of financial position, the “Employee severance fund” reflects the balance of the fund exiting at 31 December 2006, minus any payment made until 31 December 2015. Item 100 “Other liabilities” - “Due to social security institutions” shows the debt accrued at 31 December 2015 relating to the severance amounts payable to pension funds and INPS’s Treasury fund.
Actuarial gains and losses, reflecting the difference between the carrying amount of the liability and the present value of the obligation at year-end, are recognized through equity in the Valuation reserve, in accordance with IAS 19 Revised.

Revenue recognition
Revenues are recognized when they are collected or, in any case, when it is probable that future benefits will be received and they can be reliably quantified. In particular, interest income on receivables from customers from banks are classified under “Interest and similar income” and recorded on an accrual basis. In particular, interest on customer financing, commission income and interest receivable from banks are recognized as Interest and similar income deriving from loans to banks and customers and are recognized on the basis of amortized cost, using the effective interest rate method.
Commission and interest received or paid in relation to financial instruments are accounted for on an accruals basis. On the other hand, commissions considered in amortized cost to determine the effective rate of interest are recognized as interest.
Revenues from services are recognized when the services are rendered.
Dividends are recognized in the year in which their distribution is approved.
Cost recognition
Costs are recognized as they are incurred. Costs attributable directly to financial instruments measured at amortized cost and determinable since inception, regardless of when the relevant outlays take place, flow to the income statement via application of the effective interest rate.
Impairment losses are recognized as incurred.
Finance leases
Lease transactions are accounted for in accordance with IAS 17.





In particular, recognition of a lease agreement as a lease transaction is based on the substance that the agreement on the use of one or more specific assets and whether the agreement transfers the right to use such asset.
A lease is a finance lease if it transfers all the risks and benefits incidental to ownership of the leased asset; if it does not, then a lease is an operating lease.
For finance lease agreements where the FCA Bank Group acts as lessor, the assets provided under finance lease arrangements are reported as a receivable in the statement of financial position for a carrying amount equal to the net investment in the leased asset. All the interest payments are recognized as interest income (finance component in lease payments) in the income statement while the part of the lease payment relating to the return of principal reduces the value of the receivable.
Foreign currency transactions
Foreign currency transactions are entered, upon initial recognition, in the reference currency by applying to the foreign currency amount the exchange rate prevailing on the transaction date. At every interim and year-end reporting date, items originated in a foreign currency are reported as follows:
cash is converted at the exchange rate prevailing at year-end;
non-monetary items, recognized at historical cost, are converted at the exchange rate prevailing on the date of the transaction;
non-monetary items, recognized at fair value, are converted at the exchange rate prevailing at year-end.
Exchange rate differences arising from the settlement of monetary items and the conversion of monetary items at exchange rates other than the initial ones, or those used to translate the previous year’s accounts, are recognized in the income statement as incurred. When a gain or a loss related to a non-monetary item is recognized through equity, the exchange rate difference related to such item is also recognized through equity. By converse, when a gain or a loss is recognized through profit or loss, the exchange rate difference related to such item is also recognized through profit or loss.
Use of estimates
Financial reporting requires use of estimates and assumptions which might determine significant effects on the amounts reported in the Statement of financial position and in the Income statement, as well as the disclosure of contingent assets and liabilities. The preparation of these estimates implies the use of the information available and subjective assessments, based on historical experience, used to make reasonable assumptions to record the transactions. By their nature, the estimates and assumptions used may vary from one year to the next and, as such, so may the carrying amounts in the following years, significantly as well, as a result of changes in the subjective assessments made.
The main cases where subjective assessments are required include:
quantification of losses on loans and receivables, investments and, in general, on financial assets;
evaluation of the recoverability of goodwill and other intangible assets;
quantification of employee provisions and provisions for risks and charges;
estimates and assumptions on the recoverability of deferred tax assets.
The estimates and assumptions used are periodically and regularly checked by the Group. Variations in actual circumstances could require that those estimates and assumptions are subsequently adjusted. The impacts of any changes in estimates and assumptions are recognized directly in profit or loss in the period in which the estimates are revised, if the revision impacts only that period, or also in future periods, if the revision impacts both the current and future periods.
Following are the key considerations and assumptions made by management in applying IFRS and that could have a significant impact on the amounts recognized in the consolidated financial statements or where there is significant risk of a material adjustment to the carrying amounts of assets and liabilities during a subsequent financial period.

Recoverability of deferred tax assets





At 31 December 2015, the Group had deferred tax assets on deductible temporary differences and theoretical tax benefits arising from tax loss carryforwards. The Group has recorded this amount because it believes that it is likely to be recovered.
In determining this amount, management has taken into consideration figures from budgets and forecasts consistent with those used for impairment testing and discussed in the preceding paragraph on the recoverable amount of non-current assets.
Moreover, the contra accounts that have been recognized are considered to be sufficient to protect against the risk of a further deterioration of the assumptions in these forecasts, taking account of the fact that the net deferred assets so recognized relate to temporary differences and tax losses which, to a significant extent, may be recovered over a very long period, and are therefore consistent with a situation in which the time needed to exit from the crisis and for an economic recovery to occur extends beyond the horizon implicit in the above-mentioned estimates.

Pension plans and other post-employment benefits
Employee benefit liabilities with the related assets, costs and net interest expense are measured on an actuarial basis, which requires the use of estimates and assumptions to determine the net liabilities or net assets.
The actuarial method takes into consideration parameters of a financial nature such as the discount rate and the expected long term rate of return on plan assets, the growth rate of salaries and the growth rates of health care costs as well as the likelihood of potential future events by using demographic assumptions such as mortality rates, dismissal or retirement rates.
In particular, the discount rates selected are based on yields curves of high quality corporate bonds in the relevant market. The expected returns on plan assets are determined considering various inputs from a range of advisors concerning long-term capital market returns, inflation, current bond yields and other variables, adjusted for any specific aspects of the asset investment strategy. Salary growth rates reflect the Group’s long-term actual expectation in the reference market and inflation trends. Trends in health care costs are developed on the basis of historical experience, the near-term outlook for costs and likely long-term trends.
Changes in any of these assumptions may have an effect on future contributions to the plans.

Contingent liabilities
The Group makes provisions for pending disputes and legal proceedings when it is considered probable that there will be an outflow of funds and when the amount of the losses arising therefrom can be reasonably estimated. If an outflow of funds becomes possible but the amount cannot be estimated, the matter is disclosed in the notes. The Group is the subject of legal and tax proceedings covering a range of matters which are pending in various jurisdictions. Due to the uncertainty inherent in such matters, it is difficult to predict the outflow of funds which will result from such disputes. Moreover, the cases and claims against the Group often derive from complex and difficult legal issues which are subject to a different degree of uncertainty, including the facts and circumstances of each particular case, the jurisdiction and the different laws involved. In the normal course of business the Group monitors the stage of pending legal procedures and consults with legal counsel and experts on legal and tax matters. It is therefore possible that the provisions for the Group’s legal proceedings and litigation may vary as the result of future developments of the proceedings under way.
A.3 - Information on transfers between portfolios of financial assets
In 2015 no inter-portfolio transfers were made.

A.4 - Information on fair value
According to IFRS 13, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). IFRS 7 introduces instead the definition of “fair value hierarchy”. This standard calls for fair value to be determined in accordance with a three-level hierarchy based on the significance of the inputs used in such measurement. The objective is to set the price at which the asset can be sold.
 





The three levels are as follows:
a) Level 1 (L1): quoted prices (without adjustments) in an active market - as defined by IAS 39 - for the assets and liabilities to be measured;
b) Level 2 (L2): inputs other than quoted market prices included within Level 1 that are observable either directly (prices) or indirectly (derived from prices) in the market;
c) Level 3 (L3): inputs that are not based on observable market data.

Below, the methods adopted by the Company to determine fair value are illustrated:

Financial instruments classified as (L1), whose fair value is their market price (securities traded in an active market), refer to:

Austrian government bonds purchased by the Austrian subsidiary, quoted in regulated markets (Caption: assets held to maturity);
Bonds issued by the subsidiaries in Ireland, Poland and Switzerland under, the Euro Medium Term Notes programmer and listed in regulated markets (Caption: bonds outstanding);
Bonds issued in connection with securitization transactions, placed with the public or with private investors, by different Group entities (Caption: bonds outstanding).

For listed bonds issued in connection with securitization transactions, reference to prices quoted by Bloomberg.

Financial assets and liabilities classified as (L2), whose fair value is determined by using inputs other than quoted market prices that are observable either directly (prices) or indirectly (derived from prices) in the market, refer to:
OTC trading derivatives to hedge securitization transactions,
OTC derivatives entered into to hedge Group companies’ receivables,
trade receivable portfolio (Caption: Receivables),
borrowings,
bonds issued in connection with securitization transactions, placed with the public or with private investors, by different Group entities.

Derivatives are measured by discounting their cash flows at the rates plotted on the yield curves provided by Bloomberg. Receivables and payables are measured in the same way.

Bonds outstanding reflect the prices published by Bloomberg. For unlisted bonds reference is made to quoted prices for comparable transactions.
In accordance with IFRS 13, to determine fair value, the FCA Bank Group considers default risk, which includes changes in the creditworthiness of the entity and its counterparties.

In particular:
a CVA (Credit Value Adjustment) is a negative amount that takes into account scenarios in which the counterparty fails before the company and the company has a positive exposure to the counterparty. Under these scenarios, the company incurs a loss equal to the replacement value of the derivative;
a DVA (Debt Value Adjustment) is a positive amount that takes into account scenarios in which the company fails before the counterparty and the company has a negative exposure to the counterparty. Under these scenarios, the company obtains a gain for an amount equal to the replacement cost of the derivative.

For listed bonds issued in connection with private securitization transactions, reference is provided by prime banks active in the market taking as reference equivalent transactions, or made to the nominal value of the bonds or the fair value attributed by the banking counterparty that subscribed to them.





The Group uses measurement methods (mark to model) in line with those generally accepted and used by the market. Valuation models are based on the discount of future cash flows and the estimation of volatility; they are reviewed both when they are developed and from time to time, to ensure that they are fully consistent with the objectives of the valuation.
 
These methods use inputs based on prices prevailing in recent transactions on the instrument being measured and/or prices/quotations of instruments with similar characteristics in terms of risk profile.


A.4.5 FAIR VALUE HIERARCHY
A.4.5.1 Assets an liabilities measure at fair value on a recurring basis: breakdown by fair value levels
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Financial Assets/Liabilities measured at fair value
12/31/2015
12/31/2014
L1
L2
L3
L1
L2
L3
1. Financial assets held for trading
0
2,993
0
0
13,155
0
2. Financial assets at fair value through P&L
0
0
0
0
0
0
3. Available for sale financial assets
0
0
0
0
0
0
4. Hedging derivative assets
0
95,842
0
0
83,603
0
5. Property, plant and equipment
0
0
0
0
0
0
6. Intangible assets
0
0
0
0
0
0
Total
 
98,835
0
0
96,758
0
1. Financial liabilities held for trading
0
8,004
0
0
16,140
0
2. Financial liabilities at fair value through P&L
0
0
0
0
0
0
3. Hedging derivative liabilities
0
61,403
0
0
80,818
0
Total
0
69,407
0
0
96,958
0
 
 
 
 
 
 
 
L1 = Livello 1
 
 
 
 
 
 
L2 = Livello 2
 
 
 
 
 
 
L3 = Livello 3
 
 
 
 
 
 


 
 
 
 
 
 
 
 
 
A.4.5.4 Assets and liabilities not measured at fair value or measured at fair value on a non-recurring basis: distributions for levels of fair value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets/Liabilities not measured at fair value or measured at fair value on a non recurring- basis
31/12/2015
31/12/2014
BV
L1
L2
L3
BV
L1
L2
L3
1. Held-to-maturity investments
9,682
10,512
0
0
9,715
10,631
0
0
2. Loans and receivables with banks
1,333,338
0
1,303,308
0
736,050
0
736,050
0
3. Loans and receivables with customers
15,453,854
0
15,501,977
0
13,842,958
0
13,902,064
0
4. Available for sale financial assets
0
0
0
0
0
0
0
0
5. Non current assets classified as held for sale
0
0
0
0
0
0
0
0
Total
16,796,874
10,512
16,805,285
0
14,588,723
10,631
14,638,114
0
1. Deposits from banks
6,779,283
0
7,109,280
0
5,817,147
0
5,804,105
0
2. Deposits from customers
319,000
0
365,454
0
199,221
0
214,776
0
3. Debt certificates including bonds
8,244,250
5,744,121
2,526,157
0
7,069,598
4,186,488
2,961,896
0
4. Liabilites included in disposal group classified as hfs
0
0
0
0
0
0
0
0
Total
15,342,533
5,744,121
10,000,891
0
13,085,966
4,186,488
8,980,777
0
 
 
 
 
 
 
 
 
 
VB = Valore di bilancio
 
 
 
 
 
 
 
 
L1 = Livello 1
 
 
 
 
 
 
 
 
L2 = Livello 2
 
 
 
 
 
 
 
 
L3 = Livello 3
 
 
 
 
 
 
 
 






A.5 - Information about “day one profit/loss”
IFRS 7, Paragraph 28 regulates the particular case in which, in the event that the purchase of a financial instrument calculated at fair value but not listed in market, the transaction cost, that generally represent the best estimate at fair value in an initial basis, diverges to the fair value determined with the evaluative techniques adopted by the entity.
In this case an evaluative profit/loss is realized and an adequate informative note for class of financial instrument must be provided at the purchase place.



PART B - INFORMATION ON THE CONSOLIDATED BALANCE SHEET
ASSETS
Section 1 - Cash and cash equivalents - Item 10
This item includes cheques, cash and cash equivalent items.


1.1 Cash and cash balances
 
31/12/2015
31/12/2014
a) Cash
21
22
b) Demand deposits with Central banks
0
0
Total
21
22







Section 2 - Financial assets held for trading - Item 20    
2.1 Financial assets held for trading: product breakdown
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Items/Values
31/12/2015
31/12/2014
L1
L2
L3
L1
L2
L3
A. Balance-sheet assets
 
 
 
 
 
 
1. Debt securities
0
0
0
0
0
0
1.1 Structured securities
0
0
0
0
0
0
1.2 Other
0
0
0
0
0
0
2. Equity instruments
0
0
0
0
0
0
3. Units in investment funds
0
0
0
0
0
0
4. Loans
0
0
0
0
0
0
4.1 Repos
0
0
0
0
0
0
4.2 Other
0
0
0
0
0
0
Total (A)
0
0
0
0
0
0
B. Derivative instruments
 
 
 
 
 
 
1. Financial derivatives:
0
2,993
0
0
13,155
0
1.1 Trading
0
2,993
0
0
13,155
0
1.2 Related to fair value option assets / liabilities
0
0
0
0
0
0
1.3 Other
0
0
0
0
0
0
2. Credit derivatives:
0
0
0
0
0
0
2.1 Trading
0
0
0
0
0
0
2.2 Related to fair value option assets / liabilities
0
0
0
0
0
0
2.3 Other
0
0
0
0
0
0
Total (B)
0
2,993
0
0
13,155
0
Total (A+B)
0
2,993
0
0
13,155
0
 
 
 
 
 
 
 
L1 = Level 1
 
 
 
 
 
 
L2 = Level 2
 
 
 
 
 
 
L3 = Level 3
 
 
 
 
 
 

This item includes the positive valuation of financial derivative instruments related to the securitization transactions, which were entered into with the banks involved in such transactions.






2.2 Financial instruments held for trading: breakdown by debtors/issuers
 
 
 
 
 
 
Items/Values
31/12/2015
31/12/2014
A. Financial assets (non-derivatives)
 
 
1. Debt securities
0
0
a) Governments and central banks
0
0
b) Other public-sector entities
0
0
c) Banks
0
0
d) Other issuers
0
0
2. Equity instruments
0
0
a) Banks
0
0
b) Other issuers:
0
0
- Insurance companies
0
0
- Financial companies
0
0
- Non-financial companies
0
0
- Other
0
0
3. Units investment funds
0
0
4. Loans
0
0
a) Governments and Central Banks
0
0
b) Other public-sector entities
0
0
c) Banks
0
0
d) Other issuers
0
0
Total A
0
0
B. Derivative instruments
 
 
a) Banks
2,993
13,155
- Fair value
2,993
13,155
b) Customers
0
0
- Fair value
0
0
Total B
2,993
13,155
Total (A+B)
2,993
13,155
 
 
 

Section 3 - Financial assets measured at fair value - Item 30
The Group doesn’t hold financial assets though fair value.
Section 4 - Financial assets held for sale - Item 40
This item reflects the net amount of equity instruments underwritten in 2009 by FCA Bank S.p.A., for a total of €639 thousand, in connection with the restructuring of a dealer’s payables. This amount was written off in 2009.
Section 5 - Financial assets held for maturity - Item 50
5.1 Held-to-maturity investments: product breakdown
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
Total
31/12/2015
31/12/2014
BV
FAIR VALUE
BV
FAIR VALUE
L1
L2
L3
L1
L2
L3
1. Debts securities
9,682
10,512
0
0
9,715
10,631
0
0
- structured
0
0
0
0
0
0
0
0
- other
9,682
10,512
0
0
9,715
10,631
0
0
2. Loans
0
0
0
0
0
0
0
0
 
 
 
 
 
 
 
 
 
BV = Book Value
 
 
 
 
 
 
 
 





5.2 Held-to-maturity investments: breakdown by issuer/borrower
 
 
 
 
 
 
Type of transaction / Values
31/12/2015
31/12/2014
1. Debt securities
9,682
9,715
a) Governments and central banks
9,682
9,715
b) Other public-sector entities
0
0
c) Banks
0
0
d) Other issuers
0
0
2. Loans
0
0
a) Governments and central banks
0
0
b) Other public-sector entities
0
0
c) Banks
0
0
d) Other entities
0
0
Total
9,682
9,715
Total FV
0
0
 
 
 

This item includes in bond issued by the Austrian government and held by FGA Bank GmbH (Austria) and bond held by Fiat Bank Polska S.A.; these are deposits required by the local Central Bank.


Section 6 - Loans to banks - Item 60

6.1 Loans and receivables with banks: product breakdown
 
 
 
 
 
 
 
 
 
Type of transaction / Values
Total
31/12/2015
Total
31/12/2014
BV
FV
BV
FV
Level 1
Level 2
Level 3
Level 1
Level 2
Level 3
A. Loans to Central Banks
23,036
0
23,036
0
15,470
0
15,470
0
1. Time deposits
21,155
X
X
X
11,410
X
X
X
2. Compulsory reserves
1,582
X
X
X
957
X
X
X
3. Repos
0
X
X
X
0
X
X
X
4. Other
299
X
X
X
3,103
X
X
X
B. Loans to banks
1,310,302
0
1,301,300
0
746,193
0
746,193
0
1. Loans
1,310,302
0
1,301,300
0
746,193
0
746,193
0
1.1 Current accounts and demand deposits
861,995
X
X
X
668,030
X
X
X
1.2 Time deposits
223,985
0
0
0
78,163
0
0
0
1.3 Other loans:
224,322
X
X
X
0
X
X
X
- Repos
210,669
X
X
X
0
X
X
X
- Finance leases
0
X
X
X
0
X
X
X
- Other
13,653
X
X
X
0
X
X
X
2. Debts securities
0
0
0
0
0
0
0
0
2.1 Structured
0
X
X
X
0
X
X
X
2.2 Other
0
X
X
X
0
X
X
X
Total
1,333,338
0
1,324,336
0
761,663
0
761,663
0
 
 
 
 
 
 
 
 
 

Bank deposits and current accounts include funds available on current accounts or deposited by SPEs totaling €519 million (Euro 398 million at 31 December 2014). Liquidity is restricted as per each relevant securitization contract. A breakdown by SPV is provided below:














SPV
31/12/2015
31/12/2014
 
 
 
A-Best Four Srl
28,228
49,485
A-Best Five SA
 
57
A-Best Seven Srl
 
31,582
A-Best Eight Plc
 
5,956
A-Best Nine Plc
43,403
46,201
A-Best Ten S.r.l.
40,704
43,684
A-Best Eleven S.r.l.
96,316
 
A-Best Twelve S.r.l.
78,079
 
Nixes Three Plc
 
27,228
Nixes Four Srl
 
5,169
Nixes Five Plc
43,495
32,849
Nixes Six Plc
94,891
73,136
Erasmus Finance Ltd
83,422
66,447
FCT Fast 2
 
16,136
FCT Fast 3
10,065
 
TOTAL
518,603
397,930
 
 
 
 
 
 


The securitisation transactions Nixes Three, A-Best Eight and Nixes Four ended in the first half of 2015, FCT Fast 2 ended on August 2015, in the same year four new securitisations started: A-Best Eleven, A-Best Twelve, A-Best.Thirteen and FAST 3.
The Liquidity Reserve is designed to meet any cash shortfalls for the payment of interest on senior securities and certain specific expenses.
The funds held in current accounts or as bank deposits are used for:
a. acquisition of new portfolio of receivables/loans;
b. repayment of notes;
c. payment of interest on “senior” notes;
d. SPE operating costs.
 
Bank deposits and current accounts also include short term deposits held temporarily with banks and year-end current account balances resulting from ordinary operating activities.






Section 7 - Loans to customers - Item 70
7.1 Loans and receivables with customers: product breakdown
 
 
 
 
 
 
 
 
 
 
 
 
 
Type of transaction/Values
Total
31/12/2015
Total
31/12/2014
Book Value
Fair Value
Book Value
Fair Value
Performing
Impaired
L1
L2
L3
Performing
Impaired
L1
L2
L3
Purchased
Other
Purchased
Other
Loans
15,287,695
0
166,162
0
15,501,977
0
13,500,354
0
176,896
0
13,736,356
0
1. Current accounts
18,845
0
0
X
X
X
6,425
0
0
X
X
X
2. Repos
0
0
0
X
X
X
0
0
0
X
X
X
3. Mortgages
0
0
0
X
X
X
0
0
0
X
X
X
4. Credit cards and personal loans, incl. wage assignement loans
34,156
0
88
X
X
X
30,572
0
3,225
X
X
X
5. Financial leasing
2,319,725
0
32,814
X
X
X
1,948,150
0
15,878
X
X
X
6. Factoring
4,038,581
0
84,914
X
X
X
3,342,639
0
124,461
X
X
X
7. Other loans
8,876,388
0
48,346
X
X
X
8,172,568
0
33,332
X
X
X
Debts securities
0
0
0
0
0
0
0
0
0
0
0
0
8. Structured
0
0
0
X
X
X
0
0
0
X
X
X
9. Other
0
0
0
X
X
X
0
0
0
X
X
X
Total
15,287,695
0
166,162
0
15,501,977
0
13,500,354
0
176,896
0
13,736,356
0
 
 
 
 
 
 
 
 
 
 
 
 
 
L1 = Level 1
 
 
 
 
 
 
 
 
 
 
 
 
L2 = Level 2
 
 
 
 
 
 
 
 
 
 
 
 
L3 = Level 3
 
 
 
 
 
 
 
 
 
 
 
 

Factoring
This item includes:
receivables arising from sales to the dealer network for €13.2 million factored on a non-recourse basis by the FCA Group; however, since this amount was in excess of the lines of credit available, the associated risk was not transferred to the factors;
receivables arising from sales to the dealer network for €4,122.6 million, factored on a recourse basis to the commercial partners of companies of FCA Bank Group; of which, assets of SPE Fast 2 for €149 million, Fast 3 for 775.8 million, and Erasmus for €356.2 million, consolidated in accordance with IFRS 10; FGA Bank Germany GmbH (Germany), FC France S.A. (France) and FGA Capital Services Spain S.A. (Spain) are the originators of Erasmus securitisation transaction, FCA Bank S.p.A. the originator of Fast 2 and Fast 3.

Other loans
This item includes credit financing mainly concerns fixed installment car loans and personal loans.
The receivables comprise the amount of transaction costs/fees calculated in relation to the individual loans by including the following:
grants received in relation to promotional campaigns;
fees received from customers;
incentives and bonuses paid to the dealer network;
commissions on the sale of ancillary products.
Receivables include 4.103 million relating to SPEs for the securitisation of receivables, as reported in accordance with IFRS 10.

This item includes loans granted to the FCA Group dealer network to fund network development, commercial requirements in handling used vehicles and to meet specific short/medium term borrowing requirements.
The item include as well the loans to legal entity of retail business classify in this item in accordance with the definition of Bank of Italy of consumer credit.







7.2 Loans and receivables with customers: breakdown by issuer / borrower
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Type of transaction / Values
31/12/2015
31/12/2014
Bonis
Impaired
Bonis
Impaired
Purchased
Other
Purchased
Other
1. Debt securities issued by
0
0
0
0
0
0
a) Governments
0
0
0
0
0
0
b) Other public-sector Entities
0
0
0
0
0
0
c) Other issuers
0
0
0
0
0
0
- non-financial companies
0
0
0
0
0
0
- financial companies
0
0
0
0
0
0
- insurance companies
0
0
0
0
0
0
- other
0
0
0
0
0
0
2. Loans to:
15,287,691
0
166,163
13,500,354
0
176,896
a) Governments
4
0
0
32
0
0
b) Other public-sector Entities
462
0
0
44
0
0
c) Other entities
15,287,225
0
166,163
13,500,278
0
176,896
- non-financial companies
7,843,361
0
136,431
5,077,051
0
133,739
- financial companies
69,526
0
90
189,288
0
0
- insurance companies
63
0
0
281
0
10
- other
7,374,275
0
29,642
8,233,658
0
43,147
Total
15,287,691
0
166,163
13,500,354
0
176,896
 
 
 
 
 
 
 


7.4 Financial Leasing
Maturity Range
Total 2015
Total 2014
Non performing assets
MINIMUM PAYMENTS
GROSS INVESTMENTS
Non performing assets
MINIMUM PAYMENTS
GROSS INVESTMENTS
Principal
Interest
 
Of which unsecured residual amount
Principal
Interest
 
Of which unsecured residual amount
 
Of which secured residual amount
 
 
Of which secured residual amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
- on demand
469
1,551
 
529
2,021
0
132
3,537
3,815
327
3,669
0
- up to 3 months
8,610
157,789
 
11,677
166,398
0
7,662
221,728
 
37,240
229,390
0
- between 3 months and 1 year
2,913
484,700
 
4,892
487,612
0
2,518
497,512
 
116,974
500,030
0
- between 1 and 3 years
20,822
1,366,566
 
10,397
1,387,388
0
5,557
1,223,782
 
109,356
1,229,339
0
- over 5 years
0
309,120
 
808
309,120
0
8
1,485
 
5,174
1,493
0
- unspecified maturity
 
 
 
0
0
0
 
 
 
0
0
0
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
32,814
2,319,726
0
28,303
2,352,540
0
15,877
1,948,044
3,815
269,071
1,963,921
0
 
 
 
 
 
 
 
 
 
 
 
 
 








Section 8 - Hedging derivatives - Item 80