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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.

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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.

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1.	the Company’s Annual Report on Form 20-F for the year ended December 31, 2017, 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.

1.	the Company’s Annual Report on Form 20-F for the year ended December 31, 2017, 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.

1)	Registration Statement (Form F-3 No. 333-217806) of Fiat Chrysler Automobiles N.V.,

2)	Registration Statement (Form S-8 No. 333-201440) pertaining to the Fiat Chrysler Automobiles N.V. Equity Incentive Plan and the Fiat Chrysler Automobiles N.V. Remuneration Policy of Fiat Chrysler Automobiles N.V.;

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•	Formats of the consolidated Statement of financial position, Income statement and notes.

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•	Statement of comprehensive income.

•	Statement of changes in consolidated equity.

•	Consolidated statement of cash flows.

•	Unit of account.

•	Going concern, accrual basis of accounting and consistency of presentation of financial statements.

•	recoverability of receivables and, in general, financial assets and the determination of any impairment;

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•	determination of the fair value of financial instruments to be used for financial reporting purposes; in particular, the use of valuation models to determine 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.

•	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;

•	the power over the investee and 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.

•	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.

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1.	List of subsidiaries

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2.	Subsidiaries with significant non-controlling interests

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•	financial statements at 31 December 2017 of the Parent Company FCA Bank S.p.A.;

•	accounts as of 31 December 2017, 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.

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•	The definition of parameters to determine the significant increase of credit risk, for the proper allocation of exposures in stage 1 or stage 2. These parameters are consistent with the Bank’s credit analysis policies. Non-performing exposures, allocated in stage 3, have been considered such in keeping with prudential rules;

•	The determination of the short-term and lifetime PD;

•	The definition of the forward-looking models.

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1.	Held-for-trading financial assets

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2.	Available-for-sale financial assets

3.	Financial assets held to maturity

•	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;

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•	are attributable to an isolated, uncontrollable event that is not recurring and could not be reasonably predicted.

4.	Loans and receivables

•	when the financial asset in question is derecognized, in item 100.a) “Gains (losses) on loan or receivable disposals”; or:

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•	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”.

•	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.

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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 instalment. 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.

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5.	Hedging transaction

•	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 OCI, 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”;

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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 item, 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.

•	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.

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6.	Investments

7.	Tangible assets

•	assets for use in production;

•	assets held for investment purposes.

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8.	Intangible assets

9.	Current and deferred taxation

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•	current tax assets, that is payments in excess of taxes due under applicable national tax laws;

•	current tax liabilities, or taxes payable under applicable national tax laws;

•	deferred tax assets, that is income taxes recoverable in future years and related to:

•	deductible temporary differences;

•	unused tax loss carry-forwards; and

•	unused tax credits carried forward;

•	deferred tax liabilities, that is income tax amounts payable in future years due to the excess of income over taxable income due to timing differences.

•	existence of an enforceable right to offset the amounts recognized;

•	the parties intend to settle the assets and liabilities in a single payment on a net basis or to realize he asset and simultaneously extinguish the liability.

•	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 entities that intend to settle the current tax assets and liabilities on net basis (typically in the presence of a tax consolidation agreement).

10.	Provisions for risks and charges

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11.	Debts, securities outstanding and other liabilities

12.	Financial liabilities held for trading

13.	Insurance assets and liabilities

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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

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“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;

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“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.

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•	cash and monetary items are converted at the exchange rate prevailing at the reporting date;

•	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 the reporting date.

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•	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.

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•	Level 1 (L1): quoted prices (without adjustments) in an active market – as defined by IAS 39 – for the assets and liabilities to be measured;

•	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;

•	Level 3 (L3): inputs that are not based on observable market data.

•	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 programme 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).

•	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.

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•	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.

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•	acquisition of new portfolio of receivables/loans;

•	repayment of notes;

•	payment of interest on “senior” notes;

•	SPE operating costs.

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•	receivables arising from sales to the dealer network for €17.3 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;

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receivables arising from sales to the dealer network for €5,969.9 million, factored on a non-recourse basis by the commercial partners to companies of FCA Bank Group; of which, assets of SPE Fast 3 for €1,208.6 million and Erasmus for €1,310.8 million consolidated in accordance with IFRS 10; FCA Bank Germany GmbH (Germany), FCA Capital France S.A. (France) and FCA Capital Espana EFC S.A. (Spain) are the originators of Erasmus securitization transaction, FCA Bank S.p.A. is the originator of Fast 3.

•	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.

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•	€50.1 million related to the recognition - by the subsidiary Fidis Servizi Finanziari S.p.A., which merged into the Holding FCA Bank on March 1st, 2008 - of goodwill arising on the transfer of the “Network finance and other financing” business and the acquisition of the “Holding Division” from Fidis S.p.A.;

•	€36.8 million related to the acquisition of certain European companies engaged in dealer financing;

•	€15 million related to the acquisition of the Fidis Servizi Finanziari S.p.A. Group, which was eventually merged into the parent Company.

•	licenses and software of the subsidiary Leasys S.p.A. for €15.7 million and of the parent company, FCA Bank, for €15.1 million;

•	royalties for €1.4 million.

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•	the discount rate of 7.94% was calculated as cost of capital, considering a risk-free interest rate of 0.38%, a risk premium for the company of 6.44% and a beta of 1,18;

•	the estimated growth rate was 1.6%.

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•	security deposits by dealers for €27 million with the Parent Company and €652 million advances related to factoring.

•	Retail liabilities and security deposits made by private individuals in relation to finance leases.

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•	the provision of administrative, tax and payment services at arm’s length by companies of the FCA Group;

•	incentives payable to the FCA Group’s dealer network;

•	charges payable to dealers and banks, mainly in connection with the Parent Company’s operations.

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•	mortality rates

•	disability

•	employees leaving the company (resignation or layoff)

•	applications for anticipation

•	future employees career (hypothetical promotions to higher categories included)

•	purchasing power evolution

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1.	Issued guarantees and commitments

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•	ensure that the Board of Directors and management are properly involved in the Group’s risk management;

•	combine strategic policies and business choices with risk propensity;

•	ensure that shareholder value and returns are generated;

•	comply with all regulatory requirements;

•	activate a structured approach for the management, implementation and monitoring of the Risk Appetite Framework at all Group levels;

•	define precisely roles and responsibilities in case of breaches of risk propensity and to foster dialogue among the areas concerned at both Parent and Subsidiary level.

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1.	Overview

•	Providing of consumer credit and leases to buyers/lessees of vehicles manufactured by its industrial partners (Retail business line);

•	Lending to dealers of the industrial partners (Dealer financing business line);

•	Holding and control of investments in commercial companies that are not part of the Banking Group in Italy and in Europe. Moreover, the Bank provides financial support to the subsidiaries through the provision of lines of credit and by posting guarantees with other lenders.

2.	Credit risk management policies

•	controlled;

•	reasonable;

•	kept within certain standards.

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•	support credit approval managers in their assessments;

•	set and maintain the quality of credit standards;

•	meet customers’ credit requirements;

•	seize the commercial opportunities made available by the possibility to develop new financial products in markets and to limit losses.

•	Board of Directors;

•	Board Executive Credit Committee;

•	Credit Committee of the Parent Company;

•	HQ Internal Credit Committee;

•	Local Credit Committees.

•	setting credit risk policies and any amendment thereof;

•	adopting and approving the system to delegate powers and any modification thereof;

•	approving from time to time changes in the scorecard cut-offs (delegated to the Credit Committees);

•	setting from time to time the credit approval limits attributed to the Credit Committees and the individual - country managers.

•	recommending credit risk policies (and any change thereof) to the Board of Directors;

•	defining credit approval limits within the interval set from time to time by the Board of Directors for every business managed by the FCA Bank Group;

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•	proposing changes to the scorecards and modifying them as specifically authorized by the Board of Directors;

•	assessing and analyzing risk performance;

•	analyzing any issues assigned by the Board of Directors;

•	adopting decisions, within its authority, on credit approval requests coming from the Market and analyzing the requests to be submitted to the Board of Directors.

•	Approving credit applications within the limits of delegated authority;

•	Preparing for review and approval credit applications beyond the limits of delegated authority ;

•	Evaluating and changing the Parent Company’s and the local companies’ credit manuals within the governance of the FCAB Group Credit Guidelines;

•	Evaluating, approving or submitting to the competent bodies the Market requests regarding credit policy issues with respect to the rules established by the parent company;

•	Evaluating and approving powers delegated to the Markets.

•	Establishing local applications of general policies and guidelines for credit approval, control and collection by adapting the FCA Bank Group’s General Principles and Rules to the country’s practices and laws;

•	Formalizing and updating the Market’s Credit Policy Manual;

•	Analyzing credit exposures and lines of credit;

•	Setting, within the scope of their own authority, credit approval limits and processes (to be formalized in the Market’s Credit Policy Manual);

•	Attributing powers within their own organizational structure, to be submitted for approval to the Parent Company’s HQ Internal Credit Committee;

•	Approving credit applications within the scope of delegated authority.

•	monitoring of specific KRIs;

•	second-level control activities carried out by R&PC – GRM with specific reference to Credit review, Dealer Financing review and Collection review.

•	the issue, on 30 September 2015, of a Credit Risk Mitigation (CRM) policy.

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•	Non-Performing Loans (NPL) Ratio, calculated as the ratio of loans past due for over 90 days to total credit exposure at month-end;

•	Cost of Risk (CoR) Ratio, calculated as the ratio of total allowance for loan and lease losses and the average credit exposure calculated at month-end.

•	SIRN, calculated as the number of contracts of a given generation (N) with two or more instalments past due as a share of total contracts of the same generation;

•	Collection indicators, calculated in relation to total outstanding in collection;

•	Collateral: pledged assets, deposits, mortgage security.

•	Third-party guarantees: bank guarantees, insurance companies (bonds), sureties.

•	Other types: third-party deposits, comfort letters, retention of title, assignment of proceeds, buy back obligation.

•	Certainty of the issue date, which is obtained with the inclusion of a date and by complying with and completing the necessary formalities;

•	Concurrent execution with the financing;

•	Reference to the underlying transaction.

•	Clearing operations of transaction in derivatives;

•	REPO type operations;

•	On-balance sheet netting.

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•	Credit reviews, which involve a number of controls over the activity carried out;

•	in the Retail Financing area with the objective to:

•	ensure compliance with the Group’s credit policies and the procedures in place,

•	verify that data is properly entered in the system both for applications approved automatically and for applications processed by the acceptance unit of the Retail & Corporate Underwriting department,

•	determine any training requirements,

•	identify potential concentration risks;

•	recommend solutions to keep “acceptable” credit standards; and

•	in the Dealer Financing area with the objective to:

•	ensure that the control plan for the wholesale business is adequately implemented and carried out with the frequency required;

•	recommend solutions to improve the control plan;

•	verify that data are properly entered in the system and that such data are consistent with the lines of credit approved and the limits for substantial transactions;

•	bring to light critical results of the process and plan proper corrective action.

•	Collection Reviews, which involve a number of controls over the collection activity with the objective to:

•	ensure the proper application of the Group’s guidelines;

•	recommend solutions to improve the collection process;

•	verify that data are entered properly in the system;

•	assess the level of application of local collection rules;

•	determine any training requirements.

•	Retail Credit Review Procedure;

•	Dealer Financing Review Procedure;

•	Collection Review Procedure.

•	the general characteristics of credit risk mitigation (CRM) techniques;

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•	the requirements that need to be met by guarantees to be considered for credit risk mitigation purposes;

•	the credit risk mitigation tools utilized by FCA Bank.

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funded credit protection‧ means a technique of credit risk mitigation where the reduction of the credit risk on the exposure of an institution derives from the right of that institution, in the event of the default of the counterparty or on the occurrence of other specified credit events relating to the counterparty, to liquidate, or to obtain transfer or appropriation of, or to retain certain assets or amounts, or to reduce the amount of the exposure to, or to replace it with, the amount of the difference between the amount of the exposure and the amount of a claim on the institution (Ref. art. 4 of CRR, paragraph 58).

•	unfunded credit protection‧ means a technique of credit risk mitigation where the reduction of the credit risk on the exposure of an institution derives from the obligation of a third party to pay an amount in the event of the default of the borrower or the occurrence of other specified credit events (Ref. art. 4 of CRR, paragraph 59).

•	customers undergoing bankruptcy proceedings or with an exposure more than 8 months past due: provisions equal to 100% of the amount of the financing outstanding;

•	customers with exposures more than six months past due: provisions equal to 60% of the financing outstanding;

•	customers with exposures past due from 1 to 6 months: provisions equal to 10% of the financing outstanding;

•	customers who are current: provisions determined by the collective provision model for financing outstanding with 0 instalments past due.

•	exposures to customers in manifested financial distress;

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•	deteriorated exposures, customers in permanent financial distress.

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A.	Credit quality

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B.	Breakdown and concentration of exposures

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C.	Securitization

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E.	Sales Transactions

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Reset Gap Analysis: this methodology is designed to determine the difference between the amount of assets and liabilities with a reset date in the same time bucket. Maturity gap is the difference between the total value of the assets and liabilities maturing/showing a reset date in a specific bucket. Maturity gaps are grouped in buckets and totaled within each such bucket. This difference in called Gap Mismatch Index. Management processes of financial risks, as defined by Group policy, establish that Gap Mismatch can’t exceed ±10% for each temporal phase;

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Duration Analysis: this methodology is designed to determine the difference between the duration of assets and that of liabilities analyzed by reset date. In particular, the assets maturing/resetting in a given month are totaled and discounted to present value at the appropriate rate, as calculated on the basis of the interest rates prevailing in the market at the end of the month under analysis. The sum of all the assets so discounted, as weighted by their effective term to maturity in months, divided by the total of all discounted assets, is called asset duration. The liabilities maturing/resetting in a given month are totaled and discounted to present value at the appropriate rate, as calculated on the basis of the interest rates prevailing in the market. The sum of all the liabilities so discounted, as weighted by their effective term to maturity in months, divided by the total of all discounted assets, is called liabilities duration. The difference between asset duration and liabilities duration as a percentage share of asset duration is called duration gap index. Financial risk management sets maximum limits for the duration gap index, which cannot deviate for more than ± 5%;

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•	Board of Directors is responsible for managing, setting policies and reviewing the compliance, and appropriateness, of the risk management structure;

•	Advisory Board is responsible for monitoring the Company’s and the Group’s position on interest rate risk and liquidity risk;

•	Finance & Control Committee is responsible for monitoring the Company’s and the Group’s position on market risk and to define strategies to hedge significant risks;

•	Group Internal Risk Committee is responsible for setting policies on, and monitoring the proper working of, the Group’s internal control system and is convened whenever there is a crisis situation;

•	ALM Internal Committee (I.C) is responsible for:

•	Treasury is responsible for:

•	ALM & Financial Reporting is responsible for:

•	Risk & Permanent Control is responsible for:

•	performs systematic controls on the proper application of Treasury/ALM & FR procedures;

•	monitoring consistency between the interest rate risk hedging transactions approved and those carried out on a monthly basis.

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•	the Group’s financial management activities are centralized at Parent Company level, where the Treasury department is responsible for the proper financial management of all the subsidiaries. Moreover, all structured finance transactions are negotiated and managed at the central level;

•	the Parent is the only Group company with a rating assigned by Fitch Ratings, Moody’s e Standard&Poor’s. In this sense, all bank accounts and lines of credit are managed at the central level;

•	all of the Group companies refer to the Parent Company for their borrowing requirements through negotiations for the most appropriate financing instruments.

•	management of operating liquidity and structural liquidity, including the use of regularly revised and updated cash flow schedules;

•	constant monitoring of cash flows and adoption of metrics to measure and control exposure to liquidity risk (maturity mismatch approach);

•	setting limits to the exposure and concentration regarding liquidity risk;

•	stress tests to evaluate risk exposure under stressful conditions;

•	preparation of the Contingency Funding Plan intended to define the roles and responsibilities, the processes, actions to undertake and the identification of risk mitigation techniques to be adopted in case a sudden liquidity crisis.

•	Maturity Ladder, which is used to calculate, monitor and control any liquidity shortfall by maturity bucket; and

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•	Cumulative Liquidity Gap, which is used to calculate progressive cash flows and identifies the presence of any negative cash flows that would require hedging.

•	the Liquidity Coverage Ratio (LCR) every month;

•	the Net Stable Funding Ratio (NSFR) every quarter.

•	Liquidity Coverage Ratio (LCR) 206%;

•	Net Stable Funding Ratio (NSFR) 109%.

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•	Operational risk management function (embedded in the Risk & Permanent Control area) which defines and develops the methodologies, policies and procedures to identify, assess, monitor and mitigate operational risks;

•	individual units within the Group companies. These units participate actively, with varying levels of responsibility and involvement, in the operational risk management processes through the identification of the main (effective end potential) risks that can materialize in daily operations and ongoing risk control, each within the scope of its responsibilities.

•	mapping of operational risks by corporate process, in their expected and unexpected nature (updated annually and after structural process changes);

•	survey of loss events on a quarterly basis;

•	analysis and classification of risk and loss events and definition, where necessary, of control and risk mitigation actions.

•	Internal fraud;

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•	External fraud;

•	Employment relationship and safety at work;

•	Customers, products and professional practices;

•	Damage to tangible assets;

•	Breakdown of operations and malfunctions in information systems;

•	Process execution and management.

•	External frauds (only for Retail business):

•	Fraud Trend = Number of frauds per year;

•	Through The Door (TTD) Frauds / whole TTD;

•	Frauds avoided/Frauds detected.

•	Moreover, the following ratios are calculated:

•	OR Cost = Total Loss Data (including frontier risk) / Net Banking Income;

•	"Pure" OR Cost = Total Loss Data (excluding frontier risk) / Net Banking Income.

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•	a comprehensive organizational model;

•	a process for identifying, monitoring and mitigating securitization risks formalized in specific internal procedures.

•	structuring all of the Group’s transaction, managing directly (in Italy) and monitoring (abroad) the servicing activities of the securitization transactions undertaken as well as managing relations with rating agencies and investors;

•	performing 2.1 level controls. First-level controls are performed directly by the foreign markets.

•	review of the entire documentation and contractual package of the transaction by the Treasury Department – Securitization and Risk Transfer, in cooperation with internal and external counsel;

•	review of the fairness and suitability of the transaction by the Treasury Department – Securitization and Risk Transfer;

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•	Risk & Permanent Control is also responsible for second-level permanent controls on securitization transactions.

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•	Common Equity Tier 1 - CET1;

•	Additional Tier 1 - AT1;

•	Tier 2 - T2.

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•	identification of significant risks to be assessed;

•	measurement/assessment of the individual risks and the relevant internal capital;

•	determination of total internal capital – as required by the prudential provisions for Class 2 Banks and Groups – in accordance with the simplified building block technique, which involves adding the internal capital set aside for first pillar risks to internal capital for second pillar risks and any internal capital allocated as a result of stress tests;

•	stress testing designed to better assess risk exposure, the relevant mitigation systems and control as well as capital adequacy.

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1.	Information on key executive compensation

2.	Information on related-party transactions

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•	Formats of the consolidated Statement of financial position, Income statement and notes.

•	Statement of comprehensive income.

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•	Statement of changes in consolidated equity.

•	Consolidated statement of cash flows.

•	Unit of account.

•	Going concern, accrual basis and consistency of presentation of financial statements.

•	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.

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•	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.

•	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.

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•	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.

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1.	Held-for-trading financial assets

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2.	Available-for-sale financial assets

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3.	Financial assets held to maturity

•	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.

4.	Loans and receivables

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•	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”.

•	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

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•	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.

5.	Hedging transaction

•	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;

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•	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.

6.	Investments

7.	Tangible assets

•	assets for use in production;

•	assets held for investment purposes.

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8.	Intangible assets

9.	Current and deferred taxation

•	current tax assets, that is payments in excess of tax obligations to be fulfilled in accordance with the applicable law;

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•	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.

•	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.

•	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

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11.	Debts, securities outstanding and other liabilities

12.	Financial liabilities held for trading

13.	Insurance assets and liabilities

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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

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“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;

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“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.

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•	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.

•	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.

•	Recoverability of deferred tax assets

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•	Pension plans and other post-employment benefits

•	Contingent liabilities

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•	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).

•	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.

•	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.

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•	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.

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•	€50.1 million relate to the recognition - by the subsidiary Fidis Servizi Finanziari S.p.A., which merged into the Holding FCA Bank on March 1st, 2008 - of goodwill arising on the transfer of the “Network finance and other financing” business and the acquisition of the “Holding Division” from Fidis S.p.A.;

•	€36.8 million relate to the first-time consolidation of certain European companies engaged in dealer financing;

•	€15 million relate to the first-time consolidation of the Fidis Servizi Finanziari S.p.A. Group, which was eventually merged into the parent Company.

•	licenses and software of the subsidiary Leasys S.p.A. for €15.7 million and of the parent company, FCA Bank, for €15.1 million;

•	royalties for €1.4 million.

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•	the discount rate of 10,19% was calculated as cost of capital, considering a risk-free interest rate of 0.55%, a risk premium for the company of 7.65% and a beta of 1.26;

•	the estimated growth rate was 1.7%.

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•	security deposits by dealers for €35 million with the Parent Company and €149 million advances related to factoring with recourse.

•	Retail liabilities and security deposits privately issued in relation to the leasing.

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•	the provision of administrative, tax and payment services at arm’s length by companies of the FCA Group;

•	incentives payable to the FCA Group’s dealer network;

•	charges payable to dealers and banks, mainly in connection with the Parent Company’s operations.

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1.	Guarantees given and committents

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•	Senior notes - corresponding to 1,142 Mln/Eur - originated by internal securitization not registered in assets

•	State bonds originated by repurchase agreement corresponding to 66.5 k/Eur

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•	€63,8 million on insurance products not attributable to a single loan contract;

•	€18 million in recoveries of collection charges from customers;

•	€3 million in commissions for early repayments.

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•	€368 million in fees from car leases;

•	€182 million in fees from services related to car rentals

•	€74 million expenses recovered from customers on car rentals;

•	€13 million for subsidies and discounts received by the FCA Group and dealers

•	€34 million in gains on disposals of rental cars.

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1.	Overview

•	Support sales, in Italy and abroad, of cars by FCA and other car manufacturing partners, by offering financing opportunities tailored to the different requirements of dealer networks, retail customers and companies;

•	Be the provider of choice for customers and dealers requiring financing services;

•	Continue to manage risk carefully, within the framework of the objectives set out by the shareholders;

•	Diversify the structure of funding sources.

•	Dealer financing;

•	Customer financing: retail products intended to encourage the purchase/use of cars;

•	Ancillary insurance products and services in connection with the financing activity (credit protection and car insurance).

•	Provision of consumer credit and finance lease services to buyers and users of cars made by its manufacturing partners (Retail Financing business line);

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2.	Credit risk management policies

•	controlled;

•	reasonable;

•	kept within certain standards.

•	support credit approval managers in their assessments;

•	set and maintain the quality of credit standards;

•	meet customers’ credit requirements;

•	take the commercial opportunities made available by the possibility to develop new financial products in markets and to limit losses.

•	Board of Directors;

•	Board Executive Credit Committee;

•	Credit Committee of the Parent Company;

•	Local Credit Committees.

•	Setting credit risk policies and any amendment thereof;

•	Adopting and approving the system to delegate powers and any modification thereof;

•	Approving from time to time changes in the scorecard cut-offs (delegated to the Credit Committees);

•	Setting from time to time the credit approval limits attributed to the Credit Committees and the individual country managers.

•	Recommending credit risk policies (and any change thereof) to the Board of Directors;

•	Defining credit approval limits within the interval set from time to time by the Board of Directors for every business managed by the FCA Bank Group;

•	Proposing changes to the scorecards and modifying them as specifically authorized by the Board of Directors;

•	Checking and analysing risk performance;

•	Analysing any issues assigned by the Board of Directors;

•	Adopting decisions, within its authority, on credit approval requests coming from the Market and analysing the requests to be submitted to the Board of Directors.

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•	Approving credit applications within the limits of delegated authority;

•	Preparing for review and approval credit applications beyond the limits of delegated authority;

•	Evaluating and changing the Parent Company’s and the local companies’ credit manuals;

•	Evaluating and approving deviations from the credit policies established by the Parent company, upon the Markets’ request;

•	Evaluating and approving powers delegated to the Markets.

•	Establishing local applications of general policies and guidelines for credit approval, control and collection by adapting the FCA Bank Group’s General Principles and Rules to the country’s practices and laws;

•	Formalizing and updating the Market’s Credit Policy Manual;

•	Analysing credit exposures and lines of credit;

•	Setting, within the scope of their own authority, credit approval limits and processes (to be formalized in the Market’s Credit Policy Manual);

•	Attributing powers within their own organizational structure, to be submitted for approval to the Parent Company’s HQ Internal Credit Committee;

•	Approving credit applications within the scope of delegated authority.

•	monitoring of specific KRIs;

•	use of guarantees;

•	second-level control activities carried out by R&PC - GRM with specific reference to Credit review, Dealer Financing review and Collection review.

•	Non-Performing Loans (NPL) Ratio, calculated as the ratio of loans past due for over 90 days to total credit exposure at month-end;

•	Cost of Risk (CoR) Ratio, calculated as the ratio of total allowance for loan and lease losses and the average credit exposure calculated at month-end.

•	SIRN, calculated as the number of contracts of a given generation (N) with two or more instalments past due as a share of total contracts of the same generation;

•	Collection indicators, calculated in relation to total outstanding in collection;

•	Litigation indicators, calculated in relation to total outstanding in litigation.

•	Collateral: pledged assets, deposits, mortgage security.

•	Third-party guarantees: bank guarantees, insurance companies (bonds), sureties.

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•	Other types: third-party deposits, comfort letters, retention of title, assignment of proceeds, buy back obligation.

•	Certainty of the issue date, which is obtained with the inclusion of a date and by complying with and completing the necessary formalities;

•	Concurrent execution with the financing;

•	Reference to the underlying transaction.

•	Credit reviews, which involve a number of controls over the activity carried out in the Retail Financing area with the objective to:

•	ensure compliance with the Group’s credit policies and the procedures in place;

•	check that data is properly entered in the system both for applications approved automatically and for applications processed by the acceptance unit of the Retail & Corporate Underwriting department;

•	determine any training requirements,

•	identify potential concentration risks,

•	recommend solutions to keep “acceptable” credit standards,

•	ensure that the control plan for the wholesale business is adequately implemented and carried out with the frequency required;

•	recommend solutions to improve the control plan;

•	check that data is properly entered in the system and that such data is consistent with the lines of credit approved and the limits for substantial transactions;

•	bring to light critical results of the process and plan proper corrective action.

•	Collection Reviews, which involve a number of controls over the collection activity with the objective to:

•	ensure the proper application of the Group’s guidelines;

•	recommend solutions to improve the collection process;

•	check that data is entered properly in the system;

•	assess the level of application of local collection rules;

•	determine any training requirements.

•	Credit Review Retail Procedure;

•	Dealer Financing Review Procedure;

•	Collection Review Procedure.

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B.	Breakdown and concentration of exposures

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A.	Securitization

•	Diversification of funding sources: securitizations are a significant source of alternative funding for the Group, compared to ordinary bank funding;

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Improvement of liquidity position: the Group’s potential ability to securitize its receivables provides significant support to the Group’s liquidity position. The excellent results of the transactions carried out so far, together with the operating companies’ reputation in the role of servicers, guarantee in fact immediate access to this instrument, in case of difficulties in the other financial markets of reference;

•	Optimization of the cost of funding: the structures used to carry out the securitizations and the quality of the receivables assigned make it possible, thanks to higher ratings, to obtain competitive funding costs.

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•	A-BEST FOUR

•	A-BEST SEVEN

•	A-BEST NINE

•	A-BEST TEN

•	A-BEST ELEVEN

•	A-BEST TWELVE

•	A-BEST THIRTEEN.

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E.	Sales Transactions

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•	Board of Directors is responsible for managing, setting policies and reviewing the compliance, and appropriateness, of the risk management structure;

•	Advisory Board is responsible for monitoring the Company’s and the Group’s position on interest rate risk and liquidity risk;

•	Finance & Control Committee is responsible for monitoring the Group’s position on market risk and to define strategies to hedge significant risks;

•	Group Internal Risk Committee is responsible for setting policies on, and monitoring the proper working of, the Group’s internal control system and is convened whenever there is a crisis situation;

•	ALM Internal Committee (I.C) is responsible for:

•	Treasury is responsible for:

•	ALM & Financial Reporting is responsible for:

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•	Risk & Permanent Control performs systematic controls on the proper application of Treasury/ALM & FR procedures, including the relevant controls.

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Reset Gap Analysis: this methodology is designed to determine the difference between the amount of assets and liabilities with a reset date in the same time bucket. Maturity gap is the difference between the total value of the assets and liabilities maturing/showing a reset date in a specific bucket. Maturity gaps are grouped in buckets and totalled within each such bucket. The ratio of this total to the total assets maturing/showing a reset date in the bucket is defined as gap mismatch index. Financial risk management sets maximum limits for the gap mismatch index, which cannot deviate for more than ± 10%;

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Duration Analysis: this methodology is designed to determine the difference between the duration of assets and that of liabilities analysed by reset date. In particular, the assets maturing/resetting in a given month are totalled and discounted to present value at the appropriate rate, as calculated on the basis of the interest rates prevailing in the market at the end of the month under analysis. The sum of all the assets so discounted, as weighted by their effective term to maturity in months, divided by the total of all discounted assets, is called asset duration. The liabilities maturing/resetting in a given month are totalled and discounted to present value at the appropriate rate, as calculated on the basis of the interest rates prevailing in the market. The sum of all the liabilities so discounted, as weighted by their effective term to maturity in months, divided by the total of all discounted assets, is called liabilities duration. The difference between asset duration and liabilities duration as a percentage share of asset duration is called duration gap index. Financial risk management sets maximum limits for the duration gap index, which cannot deviate for more than ± 5%;

•	Board of Directors is responsible for managing, setting policies and reviewing the compliance, and appropriateness, of the risk management structure;

•	Advisory Board is responsible for monitoring the Company’s and the Group’s position on interest rate risk;

•	Finance & Control Committee is responsible for monitoring the Group’s position on interest rate risk and to define strategies to hedge significant risks;

•	Group Internal Risk Committee is responsible for setting policies on, and monitoring the proper working of, the Group’s internal control system and is convened whenever there is a crisis situation;

•	ALM Internal Committee (I.C) is responsible for:

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•	Treasury is responsible for:

•	ALM & Financial Reporting is responsible for:

•	Risk & Permanent Control performs systematic controls on the proper application of Treasury/ALM & FR procedures, including the relevant controls.

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A.	Overview, management processes and methods to measure liquidity risk.

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•	the Group’s financial management activities are centralized at Parent Company level, where the Treasury department is responsible for the proper financial management of all the subsidiaries. Moreover, all structured finance transactions are negotiated and managed at the central level;

•	the Parent is the only Group company with a rating assigned by Fitch Ratings, Moody’s e Standard&Poor’s. In this sense, all bank accounts and lines of credit are managed at the central level;

•	all of the Group companies refer to the Parent Company for their borrowing requirements through negotiations for the most appropriate financing instruments.

•	management of operating liquidity and structural liquidity, including through regularly revised and updated cash flow schedules;

•	constant monitoring of cash flows and adoption of metrics to measure and control exposure to liquidity risk (maturity mismatch approach);

•	setting limits to the exposure and concentration regarding liquidity risk;

•	stress tests to evaluate risk exposure under stressful conditions;

•	preparation of the Contingency Funding Plan intended to define the roles and responsibilities, the processes, actions to undertake and the identification of risk mitigation techniques to be adopted in case a sudden liquidity crisis is signalled by early warning indicators (EWI).

•	management of short-term liquidity risk, involving what is known as operating liquidity, typically with a time horizon of up to one year, with an impact on the Group’s liquidity over the cited time horizon;

•	management of medium/long-term liquidity risk, involving what is known as structural liquidity, that is the management of all the events that impact the Group’s liquidity position. The primary objective is to maintain an adequately steady ratio between medium/long-term assets and liabilities obtained by comparing the asset and liability maturity profiles, thus:

•	Maturity Ladder, which is used to calculate, monitor and control any liquidity shortfall by maturity bucket; and

•	Cumulative Liquidity Gap, which is used to calculate progressive cash flows and identifies the presence of any negative cash flows that would require hedging.

•	the Liquidity Coverage Ratio (LCR) every month;

•	the Net Stable Funding Ratio (NSFR) every quarter.

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•	Board of Directors is responsible for managing, setting policies and reviewing the compliance, and appropriateness, of the risk management structure;

•	Advisory Board is responsible for monitoring the Company’s and the Group’s position on liquidity risk;

•	Group Internal Risk Committee is responsible for setting policies on, and monitoring the proper working of, the Group’s internal control system and is convened whenever there is a liquidity crisis situation in the market or affecting the Company (Contingency Funding Plan), as reported by the competent corporate function;

•	Finance & Control Committee is responsible for monitoring the Group’s position on liquidity risk and to define strategies to hedge significant risks.

•	ALM Internal Committee (I.C.) is responsible for:

•	Treasury is responsible for:

•	ALM & Financial Reporting is responsible for:

•	Risk & Permanent Control performs systematic controls on the proper application of Treasury/ALM & FR procedures, including the relevant controls.

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a first-level control function composed of individual units within the Group companies. These units participate actively, with varying levels of responsibility and involvement, in the operational risk management processes through the identification of the main (effective end potential) risks that can materialize in daily operations and ongoing risk control, each within the scope of its responsibilities;

•	a second-level operational risk management function (embedded in the Risk & Permanent Control area) which defines and develops the methodologies, policies and procedures to identify, assess, monitor and mitigate operational risks;

•	a third-level control function by the Internal Audit department, in keeping with the Group’s internal control system.

•	mapping of operational risks by corporate process, in their expected and unexpected nature (updated annually and after structural process changes);

•	survey of loss events on a quarterly basis;

•	analysis and classification of risk and loss events and definition, where necessary, of control and risk mitigation actions;

•	analysis of alert events that might change the Group’s risk profile, depending on their materialization above certain threshold amounts.

•	Theft and fraud (internal and external)

•	Employment and safety at work

•	Customers, products and professional practices

•	Damage to tangible assets

•	Shutdowns and failures of information systems

•	Process execution and management.

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•	a comprehensive organizational model;

•	a process to identify, monitor and mitigate securitization risks formalized in specific internal procedures.

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•	Capital Markets, unit of the Treasury department, is responsible for:

•	Risk & Permanent Control - GRM defines and develops the methodologies, policies and procedures to detect, assess, monitor, measure and mitigate second-level securitization risks; it expresses its opinion within the NPA Committee.

•	Internal Audit carries out, at least every three years, checks on the adequacy of the internal control system and verifies that FCA Bank’s management of securitization transactions and servicing activity comply with applicable regulations.

•	control of the appropriateness and adequacy of the transaction in its entirety by the Treasury department - Capital Markets;

•	control of the appropriateness and adequacy of the transaction in its entirety by the Treasury department - Capital Markets, in cooperation with legal affairs and external counsel;

•	Risk & Permanent Control - PC is also directly responsible for second-level permanent controls over securitization transactions.

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•	identification of significant risks to be assessed;

•	measurement/assessment of the individual risks and the relevant internal capital;

•	determination of total internal capital - as required by the prudential provisions for Class 2 Banks and Groups - in accordance with the simplified building block technique, which involves adding the internal capital set aside for first pillar risks to internal capital for second pillar risks and any internal capital allocated as a result of stress tests;

•	stress testing designed to assess better risk exposure, the relevant mitigation systems and control as well as capital adequacy.

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1.	Compensation to key executive directors

2.	Information on related-party transactions

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