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2023 ReportEDMOND DE ROTHSCHILD (MONACO) | ANNUAL REPORT 2023ANNUALREPORT2023EDMOND DE ROTHSCHILD (MONACO) ANNUAL REPORT 2023 | 1 ANNUAL REPORT 2023 EDMOND DE ROTHSCHILD (MONACO) EDMOND DE ROTHSCHILD (MONACO) | 2 ANNUAL REPORT 2023 | 3 Contents 5 Shareholders' letter 6 Governing bodies Edmond de Rothschild (Monaco) 7 Financial Report Edmond de Rothschild (Monaco) Group 8 Board of Directors’ report on the consolidated financial statements 10 Statutory auditors’ report on the consolidated financial statements 11 Consolidated statement 13 Consolidated income statement 15 Notes to the consolidated financial statements 24 Financial Report Edmond de Rothschild (Monaco) 25 Board of Directors’ report on the corporate accounts 27 Statutory Auditors’ general report on the corporate accounts 28 Statutory Auditors’ special report on the corporate accounts 29 Income statement 31 Income statement 33 Income statement 42 Resolutions 44 Addresses EDMOND DE ROTHSCHILD (MONACO) | 4 ANNUAL REPORT 2023 | 5 Shareholders' letter Edmond de Rothschild enjoyed remarkable success in 2023, a year marked by turbulent international conditions and a return to normal on the financial markets. The Group was buoyed by the very positive momentum in all its business lines, demonstrating the attractiveness of its positioning. At the international level, there is no doubt that we have entered a period of geopolitical uncertainty and that we must be courageous and realistic in our response. International tensions – in Europe and the Middle East – and uncertainties about growth in Europe have become a reality that must now be reckoned with. This should in no way affect our confidence in the future – because we live in a world where revolutions are accelerating. In this changing environment, we also need to keep moving forward and innovating. At the economic and financial level, the central banks – and the Federal Reserve in particular – deserve credit for their actions to control inflation. The financial markets did not miss a beat: stock market performances were strong over the year – particularly in the last quarter of 2023. They reflect the markets’ optimism about the prospect of a rate cut in the near future and their confidence in the tremendous opportunities promised by the spread of artificial intelligence in our economies. Edmond de Rothschild’s mission is not to be a spectator in these developments, but rather to incorporate them so as to guide our actions in a positive way. This is what my family has been doing for nearly 250 years. I am particularly mindful of our ongoing commitment to ensuring that finance serves both the real economy and progress. When we work towards sustainable agriculture, the development of human capital and limits on urban sprawl, or when we combat deforestation, we are addressing real issues that arise in societal development. I am committed to making Edmond de Rothschild the model for this approach. For me, the decision to move our head office in Geneva to the eco-district of l’Etang, which we announced this year, is a strong symbol of this social commitment. It embodies my ambition to bring all the teams together in one place for greater cross-functionality, efficiency and creativity so we can design the investments of the future. Edmond de Rothschild achieved remarkable results this year. We are very proud to have won 23 awards for the quality of our expertise, the best proof of our excellence. Our management performance met the expectations of our investor clients. Our record inflows of more than CHF 11 billion demonstrate the excellence of our services and the desirability of our brand. Our financial results for 2023 are extremely solid and result from a collective effort to serve our clients. They enable us to continue to prepare for the future and maintain our ambitious growth plans. We owe it to the next generations that are watching us. This year we announced a strategic partnership in Vietnam with key player BIDV to create the country’s leading private bank with a view to local development. I would like to thank our private and institutional clients who, by allowing us to manage their assets, have become part of our Investment Vision. We have built a sound foundation together and, along with the relevance of our positioning, this gives me absolute confidence in our ability to face the future. Ariane de Rothschild Chief Executive Officer Group EDMOND DE ROTHSCHILD (MONACO) | 6 Governing bodies of Edmond de Rothschild (Monaco) Board of Directors Chairman Hervé Ordioni Vice-Chairman Jean Laurent-Bellue Directors Philippe Cieutat (2) Tobias Guldimann François Pauly (1) Cynthia Tobiano Senior Management Chief Executive Officer Gérard Ohresser Deputy Chief Executive Officer Hugues Grumiaux (4) Eric Pfefferlé (3) Geoffroy Rousseau (4) Executive Committee Jonathan Atlani (6) Hugues Grumiaux (4) Michael Mennella Gérard Ohresser Eric Pfefferlé (5) Geoffroy Rousseau Grégory Sorba Statutory Auditors André Garino (1) Jean-Paul Samba (2) Frank Vanhal (1) until 23th March 2023 (2) from the General Meeting of 23th March 2023 (3) until 1sh July 2023 (4) from the Board Meeting of 14th July 2023, autorised by ACPR 23th May 2023 (5) until 31st of October 2023 (6) from the Board Meeting of 19th July 2023 ANNUAL REPORT 2023 | 7 Financial Report Edmond de Rothschild (Monaco) Group 8 Board of Directors’ report on the consolidated financial statements 10 Statutory auditors’ report on the consolidated financial statements 11 Consolidated statement 13 Consolidated income statement 15 Notes to the consolidated financial statements EDMOND DE ROTHSCHILD (MONACO) | 8 Report of the Directors on the consolidated financial statements of Edmond de Rothschild (Monaco) to the Ordinary General Meeting of 22 March 2024 Dear Shareholders, After a devastating 2022, inflation fell and liquidity conditions gradually improved. These factors supported a general re-rating of financial assets at the expense of commodities. While investors may have been tempted to take advantage of the highest interest rates in more than 15 years and to stash a large portion of their savings in money-market products, the strongest performances were achieved by choosing investment vehicles with a long-term investment horizon (quality stocks and long-dated bonds). Indeed, in a liquidity-rich environment, time works in favour of investors who choose long-term assets. The year therefore ended with very solid performances across all asset classes. Performance of the main asset classes in 2023: the improvement has been across the board, with the exception of commodities. Cash has moved out of the latter and taken refuge in financial assets. Source: Bloomberg, Edmond de Rothschild Gestion Monaco. In addition, a new investment theme linked to the democratisation and rapid and massive adoption of artificial intelligence tools emerged in 2023. On the financial markets, this theme gave rise to the Magnificent 7. These are seven stocks of very large US companies that have been grouped under a single banner. They play a key role in making AI work and have enjoyed spectacular share price growth (+75%). Their weight in the equity indices is now quite high (28% of the S&P 500). EDMOND DE ROTHSCHILD GESTION Our asset management company has strived to deliver more and more service to the bank in terms of communication, risk management, investment transparency and team quality. During 2023, the management company recorded a rise in AuM in mandates and in dedicated funds. The increase in assets under management can be explained both by a positive market effect and by the addition of new management mandates and contributions to existing mandates. Most of the inflows were generated in large portfolios that seek to invest directly in bond vehicles. As at 31 December 2023, the number of accounts totalled 676 and assets under management reached €2.9 billion. As at 31 December 2023, the two mutual funds managed totalled €254 million in assets under management. The company’s balance sheet total was €17.1 million as at 31 December 2023. Revenue for the year totalled €16.1 million, down 11.4% compared with 2022. ANNUAL REPORT 2023 | 9 Given the €3.1 million in expenses incurred by the Company and the €0.3 million in ancillary and exceptional income, net income amounted to €13.3 million as at 31 December 2023. The company’s workforce consisted of eight employees at end-2023. EDMOND DE ROTHSCHILD ASSURANCES ET CONSEILS On the sales front, the recovery was strong in 2023, despite the interest rate environment. Regarding inflows, activity was robust in the first half of the year (60% of annual activity) and in the last quarter of the year (34% of inflows). Over the entire year, 64 insurance policies (life insurance policies and endowment policies) were set up, and we recorded 11 broker deals, representing gross inflows of €279 million as at 31 December 2023. Unit-linked inflows (97%) still made up the vast majority, and represent our core business with our partners. For our clients, the euro fund, whose main objective is to preserve capital for short-term financing of transactions and to serve as a basis for loan collateral, saw quite significant outflows in 2023 (more than 26% of outflows), due to the rise in interest rates. Sources of gross inflows remained similar to previous financial years, with Edmond de Rothschild Group accounting for 61% and independent managers for 39%. As at 31 December 2023, the estimated valuation of the EDRAC portfolio was €2,169 million (+11.1%) with a total of 977 active contracts. As a result, the average premium per contract rose to €2.2 million (compared with €1.95 million in 2022). Outflows were higher, at €236 million (versus €198 million in 2022) and the euro fund segment continued to see outflows. On an administrative level, business held steady, with more than 686 transactions processed during the financial year, compared with 659 in 2022. Regarding human resources, the workforce increased with 6 employees as at 31 December 2023. The company’s balance sheet total was €3.3 million as at 31 December 2023. Revenue for the year was down slightly to €2.9 million compared with €3 million in 2022. Given the expenses incurred by the company, i.e. €1.4 million, and income tax of €0.4 million, net income amounted to €1.1 million. CONSOLIDATED FINANCIAL STATEMENT RESULTS The consolidated balance sheet total of EdR (Monaco) was €4.4 billion, versus €4.6 billion in 2022. Net banking income was €134.5 million, up 31% year-on-year. The net interest margin doubled compared to 2022 to €68.8 million. The rise in key rates, which began in 2022, led our clients to favour the more profitable term deposits. Likewise, income from variable-rate loans granted to our clients benefited from this rise in interest rates. Surplus cash is systematically placed back with the Banque de France or in the Group’s banks under market conditions. Conversely, net fee income was down 3% to €71.1 million. Transaction fees and fees on AuM were down 4% and 6%, respectively. Operating expenses totalled €60.3 million in 2023, up 8.9% compared to 2022. This increase was attributable to personnel expenses, which rose from €39.2 million to €40.2 million, as well as other administrative expenses, which increased from €16.1 million to €20 million as at 31 December 2023. Consolidated profit thus came to €50.7 million compared with €36.4 million, up 39.2% from the previous financial year. These financial statements were approved by the Board of Directors on 20 February 2024 based on the information available at that date. Since the beginning of the Russia-Ukraine crisis, our Institution has implemented measures to monitor the changes in international provisions and the decisions taken and to assess their impact on our business. Given the level of assets and financial commitments involving counterparties linked to this crisis, our Institution did not identify any risks resulting from the consequences of sanctions against Russia/Russian residents, credit losses or indications of impairment on the items on its balance sheet as at 31/12/2023 related to the Russia-Ukraine crisis. OUTLOOK FOR 2024 After 2022, one of the worst years of the last 50 years, almost all assets performed very well in 2023. What does 2024 hold for us? The rate hikes that continued into 2023 were beneficial for our bank. Rate levels seem to have peaked, but it is very difficult to predict the extent and timing of potential cuts. Moreover, inflation is not yet under control and, more than ever, the geopolitical context calls for caution. Many uncertainties lie ahead in 2024: the elections in the United States, the level of the expected recession, the growth recovery in China, the evolution of the Russia-Ukraine conflict, and the upheavals linked to new technologies and, in particular, to the development of artificial intelligence. All these very uncertain factors will have a significant impact on the markets, which will remain volatile, which argues for a prudent and differentiated approach to the management of the assets entrusted to us by our clients. Edmond de Rothschild (Monaco) is, as always, driven by the pursuit of excellence and a long-term commitment to serve its clients by focusing its efforts on its areas of expertise. We also wish to express our sincere gratitude to our clients for their trust in us and our deepest thanks to the management team, executives and all employees for the efforts made and results achieved in 2023. The Board of Directors EDMOND DE ROTHSCHILD (MONACO) | 10 General Report on the Consolidated Financial Statements by the Statutory Auditors for the fiscal year ending on December 2023 To the Shareholders, In compliance with the assignment entrusted to us, we hereby report to you on our audit of the consolidated financial statements of the Company for the year ended 31 December 2023. These consolidated financial statements have been approved by the Board of Directors. Our role is to express an opinion on these consolidated financial statements, based on our audit. Total consolidated assets were 4'413'141'294,49€ The income statement shows a net profit of 50'743'613,82€ The share capital was 230'551'973,06€ We conducted our audit in accordance with the standards of our profession. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit involves performing procedures, using sampling techniques or other methods of selection, to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made, as well as the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. In our opinion, the consolidated financial statements give a true and fair view of the assets and liabilities and of the financial position of the Group at 31 December 2023 and of the results of its operations for the year then ended. As required by law and in accordance with the standards of our profession, we have also verified the information regarding the Group presented in the Board of Directors’ report. We have no matters to report as to its fair presentation and its consistency with the consolidated financial statements. Monaco, February 28, 2024 Frank VANHAL Jean-Paul SAMBA Statutory Auditor Statutory Auditor ANNUAL REPORT 2023 | 11 Consolidated Statement as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Liquid Cash desk, Central Banks, C.C.P. 384’898’201 457’749’985 Receivables from credit institutions 1’853’435’368 2’020’134’326 Client transactions 2’077’628’660 2’028’411’674 Doubtful loans 18’526’791 17’453’455 Bonds and other fixed income securities - - Equities and other variable-income securities 1’000 1'000 Other equity securities 64’470 64’470 Other financial fixed assets 626’768 532’487 Intangible assets 13’707’956 16’043’015 Property, plant and equipment 3’369’646 3’139’605 Other assets 51’964’676 19’928’514 Adjustment accounts 8’917’759 3’104’669 Total assets 4'413'141'295 4'566'563'201 Liabilities Due to credit institutions 186’151’244 218’288’178 Client transactions 3’926’949’258 4’063’804’968 Other liabilities 37’875’926 62’939’459 Adjustment accounts 29’157’186 17’579’929 Contingency provisions 2’455’708 1’729’521 Share capital 13'900'000 13'900'000 Consolidated reserves - Group share 165'908'359 151'872'517 Income for the financial year - Group share 50’743’614 36’448’629 Total - Group share 230'551’973 202'221’146 Minority interests - - Consolidated shareholders' equity excluding funds for general banking risks 230'551’973 202'221’146 Total liabilities 4'413'141'295 4'566'563'201 EDMOND DE ROTHSCHILD (MONACO) | 12 Consolidated off-balance sheet items as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Commitments received Financing commitments received - - Guarantee commitments received 2'419'167'621 2'236'861'582 - Guarantee received from a credit institution - - - Guarantees received from clients 2'419'167'621 2'236'861'582 Commitments on securities received - - Commitments given Financing commitments given 635'362'961 462'248'751 Guarantee commitments given 26'208'152 44'688'345 Commitments on securities given 31'361'480 36'616'010 ANNUAL REPORT 2023 | 13 Consolidated income statement as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Interest and similar income 177'080'779 56'982'555 on transactions with credit institutions 93'333'607 26'704'219 on transactions with clients 83'747'172 30'278'336 Interest and similar expenses -108'298'961 -23'226'997 on transactions with credit institutions -1'041'189 -4'328'776 on transactions with clients -107'257'772 -18'898'222 Income from variable-income securities 5'334 8'304 Commissions (income) 63'783'302 68'187'266 Commissions (expenses) -3'312'437 -3'702'157 Gains or losses on trading book transactions 10'626'683 8'787'675 trading securities 6'539'866 3'168'363 forex 4'067'227 5'581'697 financial instruments 19'590 37'615 Gains or losses on investment portfolio transactions and similar 0 73'259 Other income from banking operations 1'483'593 973'974 Other expenses from banking operations -6'865'019 -5'425'647 Net banking income 134'503'275 102'658'232 EDMOND DE ROTHSCHILD (MONACO) | 14 Consolidated income statement as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) General operating expenses -60'255'562 -55'343'742 personnel costs -40'234'778 -39'241'866 other administrative costs -20'020'784 -16'101'876 Allowances for depreciation and provisions on intangible and intangible property -4'232'634 -3'043'219 EBITDA 70'015'078 44'271'271 Cost of risk -732'621 -267'434 Operating profit 69'282'457 44'003'837 Gains or losses on fixed assets -5'412'230 - Pre-tax profit before extraordinaries 63'870'227 44'003'837 Exceptional profit/loss -172'064 -3'310 Income tax -12'954'549 -7'551'898 Allocations/write-backs on funds for general banking risks and regulated provisions - - Net income 50'743'614 36'448'629 * of which minority interests - - Net income - Group share 50'743'614 36'448'629 ANNUAL REPORT 2023 | 15 Notes to the consolidated financial statements for the financial year ended 31 December 2023 of the Edmond de Rothschild (Monaco) Group 1. GENERAL PRINCIPLES AND METHODS The consolidated financial statements of the Edmond de Rothschild Monaco Group are prepared in accordance with the general accounting principles applicable in France to credit institutions. The general registration methods specific to the regulations applicable to credit institutions and provided for in the instructions of Regulation ANC 2020-01 are applied. In accordance with the decree of 03 November 2014 repealing amended regulation no. 97/02, our Group has internal control, under the conditions provided for in said decree. 2. ACCOUNTING PRINCIPLES AND VALUATION METHODS 2.1. Scope and consolidation methods Undertakings over which the Group exercises exclusive control are fully consolidated, including undertakings with different account structures whose activity is aligned with the banking and financial activities or related activities. The Group has exclusive control by directly holding voting rights in the following consolidated companies: Edmond de Rothschild (Monaco) – Banking activity: head of the Group; Edmond de Rothschild Assurances et Conseils (Monaco) – Insurance brokerage activity: 100% of the Shares and Voting Rights are held by the head of the Group; Edmond de Rothschild Gestion (Monaco) – Discretionary portfolio and UCITS management activity: 100% of the Shares and Voting Rights are held by the head of the Group. 2.2. Balance sheet date and reference currency The consolidated financial statements are prepared as at 31 December of each year, as for all consolidated companies. The consolidated financial statements are denominated in EUR, as are as the financial statements of each of the consolidated companies. 2.3. Intra-group operations The reciprocal financial statements, as well as the income and expenses resulting from internal Group operations and having a significant influence on the consolidated financial statements, are eliminated when they relate to fully consolidated subsidiaries. For intra-group income and expenses, the amount excluding taxes is eliminated in the income statement. 2.4. Goodwill Not applicable. 2.5. Hedging transactions As the Bank/Management Company's activity is portfolio management, its involvement on the financial markets is mainly as an intermediary. It does not deal with derivatives, except for the occasional purchase or sale of options hedged on behalf of clients. As a result, it has no counterparty risk on derivatives. The other consolidated companies are not active on the markets. 2.6. Conversion of foreign currency transactions Receivables, debts and off-balance sheet commitments expressed in foreign currencies are converted at the year-end exchange rate. Foreign currency income and expenses are converted into euros at the spot rate in effect on the trade day. Forward foreign exchange contracts are valued at the forward rate of the remaining period, on the closing date of the financial year. Foreign exchange income and losses from foreign exchange transactions are included in the Income Statement. EDMOND DE ROTHSCHILD (MONACO) | 16 2.7. Operating leases Contracts for the rental of passenger vehicles and computer equipment are referred to as operating leases; the expense is recorded in a straight-line manner over the term of the contract. 2.8. Deferred tax assets Deferred tax assets relate only to temporary differences between the accounting income and the taxable income of consolidated companies subject to tax. In this case, the tax rate of 25% is applied to these temporary differences (rate applicable in the Principality of Monaco). 2.9. Minority interests Directors holding Guarantee Shares are not categorised as minority shareholders. No minority interests as at 31/12/2023. 2.10. Treasury shares The shares of the head of the Group held by consolidated subsidiaries are categorised as Treasury Shares. The income generated during the financial year by holding these Treasury Shares is offset by Consolidated Income. 2.11. Fixed assets Fixed assets are valued at their acquisition cost. Depreciations were carried out on a straight-line basis over their likely useful life, under commonly accepted rates. These are: Fixtures and facilities 5 or 10 years Movables 5 years Equipment 5 years Software 3 or 5 years IT hardware 3 years Vehicles 4 years 2.12. Pension commitments Retirement benefits resulting from the Monaco Collective Agreement for Banking Employees are not covered by insurance policies. The total provision amounted to €541,000 as at 31 December 2023 compared with €480,000 as at 31 December 2022. 2.13. Taxation The Group's tax consists of the tax due by each of the companies in respect of the financial year and the variation in deferred assets taxes. According to Monaco's tax provisions, only companies under the laws of Monaco and with revenue in Monaco of less than 75% of total revenue are subject to corporate income tax at the rate of 25%. 2.14. Counterparty risk The vast majority of interbank commitments are made with the Group. The bank's credit lines are monitored daily by the Banking Relations Department in Geneva and reviewed semi-annually by each entity's Executive Committee. A list of lines by counterparty is established and submitted to each subsidiary. Each entity sends a series of reports on the banks' credit lines and their use for the consolidation of the Group's exposure. 2.15. Impact of the Russia-Ukraine crisis on the financial statements Our institution has fully complied with international sanctions. The Russia-Ukraine crisis had no impact on our accounting principles and did not generate any additional risks requiring an adjustment to our accounts. ANNUAL REPORT 2023 | 17 3. INFORMATION ON BALANCE SHEET ITEMS 3.1. Receivables and debts Receivables and debts are broken down according to their remaining maturity as follows: Breakdown of Receivables and Debts according to residual maturity Headings (in thousands of euros) maturity ≤ 3 months 3 months < maturity ≤ 1 year 1 year < maturity ≤ 5 years maturity > 5 years Receivables from credit institutions 1'397'142 639'477 200'000 - demand 55'951 term 1'339'430 624'002 200'000 related receivables 1'761 15'475 Amounts due from clients 1'017'707 72'259 353'673 633'990 demand 773'242 term 244'372 71'830 352'166 630'028 related receivables 93 429 1'507 3'962 Doubtful loans 18'527 TOTAL ASSETS 2'433'376 711'736 553'673 633'990 Due to credit institutions 1'918 9'412 86'349 88'473 demand 1'918 term 0 9'412 86'236 88'324 related receivables 0 0 113 149 Accounts payable by clients 3'243'108 683’841 - - demand 736'653 term 2'502'128 664'351 related receivables 4'327 19'490 TOTAL LIABILITIES 3'245'026 693'253 86'349 88'473 Receivables and debts from credit institutions include transactions with banks of the Edmond de Rothschild Group and are recorded in the following table : Headings (in thousands of euros) Total Receivables from credit institutions 1'797'899 Due to credit institutions 187'409 The balance of assets largely corresponds to the investment of the surplus of resources over uses, with counterparty risk being regularly analysed by the Bank's Board of Directors. Receivables from clients are recorded on the balance sheet at their nominal value. 3.2. Equities and other variable-income securities The security held at the close by our management company EDRG is a UCITS unit of a fund under its management. Headings (in thousands of euros) at 31/12/2023 at 31/12/2022 Investment securities/Shares 0 0 Accumulation UCITS 1 1 Provision for impairment 0 0 Net book value of shares and other variable-income securities 0 0 These securities are recorded at the historical cost. A provision is made when the market value is less than the book value. EDMOND DE ROTHSCHILD (MONACO) | 18 3.3. Fixed assets As at 31 December 2023, fixed assets broke down as in the tables below : GROSS AND NET VALUES Types of fixed assets (in thousands of euros) Gross amount at start of 2023 financial year Acquisitions 2023 Disposals 2023 Gross amount at end of 2023 financial year NBV at end of 2023 financial year Intangible assets Goodwill 4'258 0 0 4'258 3'801 Leasehold rights 3'888 0 0 3'888 3'888 Software & licences 17'363 3'959 0 21'322 5'899 Miscellaneous deposits 3'586 1'946 5'412 120 120 Sub-total 29'095 5'905 5'412 29'588 13'708 Property, plant and equipment Fixtures, facilities and other tangible fixed assets 19'119 912 8'043 11'988 2'635 Miscellaneous deposits 735 735 735 Sub-total 19'119 1'647 8'043 12'723 3'370 Total Fixed Assets 19'119 1'647 8'043 12'723 3'370 DEPRECIATION Types of fixed assets (in thousands of euros) Accumulated depreciation at the beginning of the 2023 financial year Allocations 2023 Reversals 2023 Accumulated depreciation at the end of the 2023 financial year Intangible assets Goodwill 457 457 Leasehold rights 0 0 Software & licences 12'594 2’828 0 15'422 Miscellaneous deposits Sub-total 13'051 2’828 0 15'879 Property, plant and equipment Fixtures, facilities and other tangible fixed assets 15'979 1'418 8'043 9'354 Miscellaneous deposits Sub-total 15'979 1'418 8'043 9'354 Total Fixed Assets 29'030 4'246 8'043 25'233 All of these fixed assets are used for the Bank's own activities. ANNUAL REPORT 2023 | 19 3.4. Consolidated shareholders' equity Consolidated Shareholders' Equity as at 31 December 2023 totalled €230’452,000. Headings (in thousands of euros) 31/12/2022 2023 income Capital inc./red. Consolidation adjustment Profit and Loss Allocation 31/12/2023 Share capital 13'900 13'900 Issue premium 18'149 18'149 Consolidated reserves - Group share 133'723 19'149 100 -20'113 14'900 147'759 Consolidated income - Group share 36'449 50'744 -36'449 50'744 Total - Group share 202'221 69'893 100 -20'113 -21'549 230'552 Minority interests 0 0 Consolidated shareholders' equity 202'221 69'893 100 -20'113 -21'549 230'552 3.5. Provisions for Risks and Expenses Provisions for Risks and Expenses as at 31 December 2023 are €2'462,000 and consist of : Headings (in thousands of euros) Gross amount at start of 2023 financial year Allocations as at 31/12/2023 Reversals as at 31/12/2023 Balance as at 31/12/2023 Provisions for pension expenses 480 61 542 Other provisions for risks 1'250 1'494 830 1'914 Total provisions for risks and expenses 1'730 1'562 830 2'462 Commitments covered by a provision for retirement are valued annually and amounted to €542,000 at 31 December 2023. Provisions for client risks are established according to the risks of losses as soon as they are known. They are deducted from assets when they relate to doubtful loans, otherwise they are incorporated into liabilities. At 31 December 2023, the risk assessment of loans classified as doubtful loans did not result in a provision for risk of loss. EDMOND DE ROTHSCHILD (MONACO) | 20 3.6. Adjustment accounts and miscellaneous The table below provides details of the adjustment accounts and other asset and liability accounts by transaction category : Headings (in thousands of euros) Asset accounts Liability accounts Off-balance sheet foreign exchange income -358 Prepaid expenses 979 Miscellaneous income receivable 7'884 Accrued expenses - personnel 12'480 Accrued expenses - suppliers 0 7'691 Accrued expenses - business introducers 2'367 Miscellaneous 412 6'619 Total Adjustment Accounts 8'917 29'157 Securities transaction settlement accounts 2'892 9'581 Miscellaneous debtors 2'687 Security deposits paid 46'263 Miscellaneous creditors 5'341 Collateral deposits received 16'009 Tax payable to the State 6'945 Deferred Tax Asset 123 Total Other 51'965 37'876 3.7. Euro equivalent of foreign currency assets and liabilities Exchange value in thousands of euros Exchange value in thousands of euros Total assets 1'698'832 Total liabilities 1'698'834 ANNUAL REPORT 2023 | 21 4. INFORMATION ON OFF-BALANCE SHEET ITEMS 4.1. Foreign Exchange contracts not settled as at 31 December 2023 Headings (in thousands of euros) To be received To be delivered Euros purchased not received 3’616 Currencies purchased not received 3'356 Euros sold not delivered 2’956 Currencies sold not delivered 4'008 Total foreign exchange spot transactions 6'972 6'964 Euros receivable, currencies to be delivered 171'187 628'481 Currency receivable, euros to be delivered 627'179 170'112 Currency receivable, currency to be delivered 68'131 68'116 Total foreign exchange forward transactions 866'497 866'709 The transactions recorded here do not indicate that the Bank has a significant proprietary position. 4.2. Transactions on conditional foreign exchange instruments (in thousands of euros) Call purchases 12'338 Put purchases 20’000 Call sales 12'338 Put sales 20’000 For these transactions, the Bank/Management Company only acts on the markets as an intermediary and only on behalf of its clients, as transactions are systematically backed by a banking counterparty. All transactions are carried out over-the-counter. EDMOND DE ROTHSCHILD (MONACO) | 22 5. INFORMATION ON INCOME STATEMENT ITEMS 5.1. Breakdown of the interest margin for the 2023 financial year Headings (in thousands of euros) Expenses Products Credit institutions 1'041 93'334 Clients 107'258 83'747 Total interest 108'299 177'081 The interest margin reflects the difference between the income generated by loans granted to clients, as well as Cash placements, and the cost of deposits. 5.2. Breakdown of Commissions for the 2023 financial year Headings (in thousands of euros) Expenses Products Foreign exchange transactions 14 14 Securities transactions on behalf of clients 2'119 39'202 Other financial services 1’180 11'901 Other miscellaneous client transactions 0 12'667 Total commissions 3'313 63'784 The income is collected from clients. Commissions paid mainly represent costs incurred on behalf of clients with the various financial intermediaries, credit institutions or others. 5.3. Gains on trading book transactions This item reflects the result of the following transactions: - Transactions to buy and sell securities carried out by the Bank, mainly on the bond markets totalling €6,540,000; - Foreign exchange transactions totalling €4,067,000; - Transactions on financial instruments for €20,000. 5.4. Other banking operating income and expenses Headings (in thousands of euros) 2023 2022 Miscellaneous commission retrocessions 840 264 Other ancillary income 516 613 Expenses recharged to Group companies 0 0 Transfer of NB operating expenses 32 21 Other operating income 95 76 Total Income 1'483 974 Business introducers & external managers 6'148 4'741 Guarantee fund premiums 79 78 Other operating expenses 638 607 Total Expenses 6'865 5'426 ANNUAL REPORT 2023 | 23 5.5. General operating expenses - personnel costs The change in personnel costs during the 2023 financial year was as follows: Headings (in thousands of euros) 2023 2022 Wages and salaries 30'642 29'746 Pension expenses 3'632 3'531 Other social security expenses 5'861 5'838 Vocational training 100 127 Total personnel costs 40'235 39'242 The provision for paid leave, established in accordance with the regulations in force and incorporated into the Adjustment Accounts items on the Balance Sheet, has been updated according to the change in the number of employees and their leave rights as at 31 December 2023. The corresponding additional provision was booked as a charge under Personnel expenses. 5.6. Cost of risk Headings (in thousands of euros) 2023 2022 Allocations to provisions for risks and charges -1'562 -506 Losses on irrecoverable loans Write-backs on provisions for risks and charges 829 238 Total -733 -268 5.7. Exceptional revenue and expenses Exceptional expenses -€267K Exceptional revenue €95K Exceptional profit/loss -€172K 5.8. Group workforce Headcount 2023 2022 Executives 154 147 Non-executive 74 71 Total 228 218 EDMOND DE ROTHSCHILD (MONACO) | 24 Financial Report Edmond de Rothschild (Monaco) 25 Board of Directors’ report on the corporate accounts 27 Statutory Auditors’ general report on the corporate accounts 28 Statutory Auditors’ special report on the corporate accounts 29 Balance sheet 31 Income statement 33 Notes to the financial statements ANNUAL REPORT 2023 | 25 Report of the Directors on the corporate accounts of Edmond de Rothschild (Monaco) to the Ordinary General Meeting of 22 March 2024 BALANCE SHEET REVIEW On the assets side, the cash position totalled €348.8 million, down €73 million compared with 2022. Bank receivables decreased by €166.6 million to €1,853.5 million. Client loans totalled €2,077.6 million, a 2.4% increase compared with 2022. They accounted for 47% of the balance sheet total. As at 31 December 2023, the balance sheet total stood at €4.4 billion, down by €159.4 million on the previous year. On the liabilities side, bank commitments were down by €32.1 million to €186.2 million. At the end of the 2023 financial year, total client deposits were €3,941.7 million, down 3.4% compared to 2022. Client deposits accounted for 89.4% of the balance sheet total. ANALYSIS OF INCOME The Bank’s profit for 2023 totalled €52.7 million, up 41.6% on the previous year. Net banking income was €132.7 million, up 33.1% year-on-year. › Net commissions remained stable compared to 2022 at €52.1 million. › The client interest margin came to -€23.8 million, a decrease of €35.2 million compared to 2022. › The banking margin totalled €92.3 million, up €69.9 million. Operating expenses totalled €56.9 million, an increase of 9.2% compared with 2022. This increase stems from personnel expenses, which rose from €36.4 million to €37.5 million, and from other administrative expenses, which increased from €15.7 million to €19.5 million. These financial statements were approved by the Board of Directors on 20 February 2024 based on the information available at that date. Since the beginning of the Russia-Ukraine crisis, our Institution has implemented measures to monitor the changes in international provisions and the decisions taken and to assess their impact on our business. Given the level of assets and financial commitments involving counterparties linked to this crisis, our Institution did not identify any risks resulting from the consequences of sanctions against Russia/Russian residents, credit losses or indications of impairment on the items on its balance sheet as at 31/12/2023 related to the Russia-Ukraine crisis. TRANSACTIONS REFERRED TO IN ARTICLE 23 OF THE SOVEREIGN ORDINANCE OF 5 MARCH 1895 It should be noted that this section addresses any undertakings or transactions comprising a series of successive services (supply, works) of the same nature, or of a similar nature, contracted with the company or on its behalf and in which a director of your company has a direct or indirect interest. During the 2023 financial year, the following transactions, covered by Article 23 of the Sovereign Ordinance of 5 March 1895, were carried out: With EDMOND DE ROTHSCHILD (FRANCE) (Interested parties: Cynthia Tobiano and Jean Laurent-Bellue): During the 2023 financial year, the Company received administrative services. The amount invoiced by EDMOND DE ROTHSCHILD (FRANCE) under the service level agreement signed on 11 December 2017 totalled €295.474,00 (excl. tax). The company also carried out routine reciprocal banking transactions under market conditions. With EDMOND DE ROTHSCHILD (SUISSE) (Interested parties: Hervé Ordioni, Philippe Cieutat and Jean Laurent-Bellue): During the 2023 financial year, the Company received administrative services. The amount invoiced by EDMOND DE ROTHSCHILD (SUISSE) under the service agreement signed on 11 December 2017 is CHF 771,006.19 (excl. tax). The company also carried out routine reciprocal banking transactions under market conditions. MEETINGS HELD DURING THE FINANCIAL YEAR An Ordinary General Meeting was held on 23 March 2023 to approve the individual and consolidated financial statements for the financial year ended 31 December 2022. EDMOND DE ROTHSCHILD (MONACO) | 26 APPROVAL OF THE INDIVIDUAL FINANCIAL STATEMENTS AND PROPOSAL TO ALLOCATE INCOME We hereby submit the financial statements for the 2023 financial year for your approval, together with our proposal regarding the allocation of distributable profit. After taking into account retained earnings, the distributable profit is as follows: 2023 profit 52'692'210,66 Previous retained earnings 14'664,42 Distributable profit 52'706'875,08 We propose that you allocate the distributable profit as follows: Distribution of a dividend of €405 per share: For 86,875 shares 35'184'375,00 Allocation to the optional reserve 17'500'000,00 Retained earnings 22’500,08 Total 52'706'875,08 ELECTIONS AS PER OUR ARTICLES OF ASSOCIATION As the terms of office of the Directors expire at the end of this Ordinary General Meeting, we propose to renew the terms of office of Cynthia Tobiano, Jean Laurent-Bellue, Hervé Ordioni, Philippe Cieutat and Tobias Guldimann for a term of one year ending at the end of the General Meeting called to approve the financial statements for 2024. If you approve the resolutions proposed to you, the Board of Directors will be composed of: › Hervé ORDIONI › Cynthia TOBIANO › Philippe CIEUTAT › Jean LAURENT-BELLUE › Tobias GULDIMANN until the day of the Ordinary General Meeting convened to approve the financial statements for the year ended 31 December 2024. ATTENDANCE FEES Lastly, we propose setting the annual amount of attendance fees at €6,300. We also wish to express our sincere gratitude to our clients for their trust in us and to express our deepest thanks to Management, executives and all employees for the efforts made in 2023. The Board of Directors ANNUAL REPORT 2023 | 27 Statutory Auditors’ General Report on the corporate accounts for the fiscal year ending on 31 December 2023 To the Shareholders, In accordance with article 25 of Monegasque Law no. 408 of 20 January 1945, we hereby report to you on the long-term overall engagement which you have entrusted to us, in accordance with article 8 of said Law, following the decision of the Ordinary General Meeting of 24 March 2022, for Frank Vanhal for the 2022, 2023 and 2024 financial years, and the Ordinary General Meeting of 23 March 2023, for Jean-Paul Samba, for the 2023 and 2024 financial years.. The financial statements and accompanying notes have been prepared under the responsibility of the Board of Directors. The Company’s total assets were €4'407'607'882,88 The income statement shows a net profit of €52'692'210,66 The Company’s share capital was €213'266'861,52 Our role, which consists in expressing an opinion on the financial statements, was conducted in accordance with the standards of our profession, and led us to examine the transactions carried out by the Company in 2023, the balance sheet at 31 December 2023, and the income statement for the twelve months then ended and the accompanying notes to the financial statements, presented as required by banking regulations. These documents were prepared following the same overall presentation and using the same measurement methods as in the previous year. We verified the various assets and liabilities on the balance sheet as well as the methods used to measure them and to recognise the income and expenses presented in the income statement. We conducted our audit in accordance with generally accepted standards for auditing accounting information, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures, using sampling techniques, to obtain audit evidence about the amounts and disclosures in the financial statements, assess their overall presentation and evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Company’s management. We believe that our procedures form a reliable basis for our opinion. In our opinion, the balance sheet at 31 December 2023, the income statement for the year then ended and the accompanying notes, which are submitted to your approval, give a true and fair view of (i) the assets and liabilities of the Company at 31 December 2023, and (ii) the transactions and results of its operations for the twelve months then ended, in accordance with the applicable legal provisions and professional standards. We have no matters to report on the information provided in the Board of Directors’ report relating to the financial statements. The proposed appropriation of profit complies with the applicable laws and articles of association. We did not identify any infringement of the legal provisions or the provisions of the articles of association governing the organisation and procedures of the Company’s corporate bodies. Monaco, March 28, 2024 Frank VANHAL Jan-Paul SAMBA Statutory Auditor Statutory Auditor EDMOND DE ROTHSCHILD (MONACO) | 28 Statutory Auditors’ Special Report on the corporate accounts for the fiscal year ending on 31 December 2022 To the Shareholders, In accordance with article 24 of Monegasque Law No. 408 of 20 January 1945, we hereby report to you on the transactions subject to article 23 of the Sovereign Decree of 5 March 1895, which took place during the 2022 financial year, and on the Shareholders' Meetings held during this period. I. TRANSACTIONS SUBJECTS TO ARTICLE 23 OF THE SOVEREIGN DECREE OF 5 MARCH 1895 The Sovereign Decree of 5 March 1895 applies to any corporate or market transaction involving a series of successive services (i.e., provision of services, work) of the same type or of a similar type, performed by the Company or on its behalf, and in which a Director of the Company has a direct or indirect interest. The performance of these transactions during the 2023 financial year is described in the special report prepared by the Board of Directors of your Company. We have verified the information provided in this report and have no matters to report in this regard. II. SHAREHOLDERS’MEETING HELD IN 2023 During 2023, the Company’s shareholders met at an Ordinary General Meeting on 23 March 2023, notably to approve the financial statements for the year ended 31 December 2022. Regarding this Meeting, we verified : - that it was held in compliance with the applicable laws and the articles of association ; - the execution of the adopted resolutions. We have no matters to report in this regard. Monaco, March 28, 2024 Frank VANHAL Jean-Paul SAMBA Statutory Auditor Statutory Auditor ANNUAL REPORT 2023 | 29 Balance sheet as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Liquid Cash desk, Central Banks, C.C.P. 384’784’201 457’749’985 Receivables from credit institutions 1’853’549’368 2’020’134’326 Client transactions 2’077’628’660 2’028’411’674 Doubtful loans 18’526’791 17’453’455 Bonds and other fixed income securities - - Equities and other variable-income securities - - Shares in affiliated companies 365’835 365’884 Other financial fixed assets 625’403 531’073 Intangible assets 13’603’563 15’936’649 Property, plant and equipment 3’369’646 3’139’605 Other Assets 51’841’148 19’817’738 Adjustment accounts 3’313’268 3’425’545 Total assets 4'407'607'883 4'566'965'935 Liabilities Due to credit institutions 186’151’244 218’288’178 Client transactions 3’941’699’177 4’081’140’541 Other Liabilities 37’293’408 62’430’494 Adjustment accounts 26’824’553 20’535’177 Contingency provisions 2’402’640 1’670’019 Shareholders' equity excluding funds for general banking risks 213'266'861 182’901’526 Share capital 13'900'000 13’900’000 Reserves 146’659’986 131’759’986 Retained earnings 14’664 22’495 Income pending approval - - Income (loss) for the year 52'692’211 37’219’045 Total liabilities 4'407'607'883 4'566'965'935 EDMOND DE ROTHSCHILD (MONACO) | 30 Off-balance sheet items as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Commitments received Financing commitments received - - Guarantee commitments received 2'419'167'621 2'236'861'582 - Guarantee received from a credit institution - - - Guarantees received from clients 2'419'167'621 2'236'861'582 Commitments on securities received - - Commitments given Financing commitments given 635'362'961 462'248'751 Guarantee commitments given 26'208'152 44'688'345 Commitments on securities given 31'361'480 36'616'010 ANNUAL REPORT 2023 | 31 Income statement as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) Interest and similar income 177'080'779 56'982'555 on transactions with credit institutions 93'333'607 26'704'219 on transactions with clients 83'747'172 30'278'336 Interest and similar expenses -108'609'625 -23'226'997 on transactions with credit institutions -1'041'189 -4'328'776 on transactions with clients -107'568'436 -18'898'222 Income from variable-income securities 16'379'422 17'221'568 Commissions (income) 60'395'323 64'694'653 Commissions (expenses) -18'900'598 -21'365'397 Gains or losses on trading book transactions 10'626'683 8'787'675 trading securities 6'539'866 3'168'363 forex 4'067'227 5'581'697 financial instruments 19'590 37'615 Gains or losses on investment portfolio transactions and similar 0 73'259 Other income from banking operations 2'341'103 1'720'505 Other expenses from banking operations -6'571'412 -5'156'384 Net banking income 132'741'675 99'731'438 EDMOND DE ROTHSCHILD (MONACO) | 32 Income statement as at 31 December 2023 at 31/12/2023 (€) at 31/12/2022 (€) General operating expenses -56'931'289 -52'113'281 personnel costs -37'416'366 -36'426'732 other administrative costs -19'514'923 -15'686'549 Allowances for depreciation and provisions on intangible and intangible property -4'125'680 -2'954'927 EBITDA 71'684'706 44'663'230 Cost of risk -732'621 -252'673 Operating profit 70'952'085 44'410'557 Gains or losses on fixed assets -5'412'230 0 Pre-tax profit before extraordinaries 65'539'855 44'410'557 Exceptional profit/loss -253'571 -66'208 Income tax -12'594'073 -7'125'304 Allocations/write-backs on funds for general banking risks and regulated provisions Net income 52'692'211 37'219'045 ANNUAL REPORT 2023 | 33 Notes to the annual financial statements for the financial year ended 31 December 2023 of Edmond de Rothschild (Monaco) 1. GENERAL PRINCIPLES AND METHODS The annual financial statements are prepared in accordance with Regulation no. 2020-10 of 22 December 2020 and ANC Regulation no. 2014-07 of 26 November 2014 on the financial statements of companies in the banking sector. 2. ACCOUNTING PRINCIPLES AND VALUATION METHODS As the Bank's sole activity is portfolio management, its involvement on the financial markets is mainly as an intermediary. It does not deal with derivatives, except for the occasional purchase or sale of options hedged on behalf of clients. As a result, it has no counterparty risk on derivatives. 2.1. Conversion of foreign currency transactions In accordance with Articles 2711-1 to 2731-1 of Book II, Section 7 of the ANC Regulation, receivables and debts denominated in foreign currencies are converted at the exchange rates indicated by the European Central Bank on the last trading day of December. The differences that may result from this conversion are included in the income statement. Foreign exchange positions are revalued monthly by applying the rate in force at the end of the month. The resulting foreign exchange income is included in the income statement under the heading "Net gain/loss on foreign exchange transactions". Foreign currency transactions are converted at the exchange rate in force at the time of the transaction. Pursuant to Articles 2722-1 to 2723-2 of the ANC Regulation, forward foreign exchange positions are revalued: - during the term in the case of so-called "dry" forward foreign exchange transactions or forward foreign exchange transactions carried out to hedge another forward foreign exchange transaction; - at the spot rate in the case of other transactions. 2.2. Holdings and shares in affiliated companies Equity securities are recognised at their historical price. 2.3. Fixed assets Fixed assets are valued at their acquisition cost. Depreciations were carried out on a straight-line basis over their likely useful life, under commonly accepted rates. These are: › Fixtures and facilities 5 or 10 years › Movables 5 years › Equipment 5 years › Software 3 or 5 years › IT hardware 3 years › Vehicles 4 years 2.4. Types of financial instruments As part of its management activity, the Bank has processed foreign exchange option and securities transactions on behalf of its clients. There were no proprietary positions opened as at 31 December 2023. 2.5. Interest and commissions Interest is recognised in the income statement on a pro rata temporis basis. Commissions are recognised as soon as the transactions that generated them are entered in the accounting system. 2.6. Social security commitments Retirement benefits resulting from the Monaco Collective Agreement for Banking Employees are not covered by insurance policies. The total provision amounted to €488,000 as at 31 December 2023. The Edmond de Rothschild Group has put in place a bonus share plan for Edmond de Rothschild Holding S.A. (Swiss unlisted holding company of the Edmond de Rothschild Group) for the benefit of certain Group employees. EDMOND DE ROTHSCHILD (MONACO) | 34 2.7. Taxation This year, the Bank again generated revenue in Monaco below 75% of its total revenue. According to Monaco's tax provisions, it remains subject to corporate income tax at a rate of 25%, i.e. €7,125,000. 2.8. Counterparty risk The vast majority of interbank commitments are made with the Group. The bank's credit lines are monitored daily by the Banking Relations Department in Geneva and reviewed semi-annually by each entity's Executive Committee. A list of lines by counterparty is established and submitted to each subsidiary. Each entity sends a series of reports on the banks' credit lines and their use for the consolidation of the Group's exposure. 2.9. Client risk The client risk assessment method is based on individualized, probable and actual risk. 2.10. Credit risk Credit risk is managed by the Credit and Treasury Committees as well as by the management team when there is a risk of probable or partial non-recovery. As at 31 December 2023, no impairment for doubtful loans was recognised. 2.11. Additional information Edmond de Rothschild (Monaco) is fully integrated into the scope of consolidation of Edmond de Rothschild (Suisse) S.A. 2.12. Impact of the Russia-Ukraine crisis on the financial statements Our institution has fully complied with international sanctions. The Russia-Ukraine crisis had no impact on our accounting principles and did not generate any additional risks requiring an adjustment to our accounts. 3. INFORMATION ON BALANCE SHEET ITEMS 3.1. Receivables and debts Receivables and debts are broken down according to their remaining maturity as follows: Breakdown of receivables and debts according to residual maturity Headings (in thousands of euros) maturity ≤ 3 months 3 months < maturity ≤ 1 year 1 year < maturity ≤ 5 years maturity > 5 years Receivables from credit institutions 1'397'142 639'477 200'000 - demand 55'951 term 1'339'430 624'002 200'000 related receivables 1'761 15'475 Amounts due from clients 1'017'707 72'259 353'673 633'990 demand 773'242 term 244'372 71'830 352'166 630'028 related receivables 93 429 1'507 3'962 Doubtful loans 18'527 TOTAL ASSETS 2'433'376 711'736 553'673 633'990 Due to credit institutions 1'918 9'412 86'349 88'473 demand 1'918 term 0 9'412 86'236 88'324 related receivables 0 0 113 149 Accounts payable by clients 3'247'385 694’283 - - demand 737'029 term 2'506'028 674'651 related receivables 4'328 19'632 TOTAL LIABILITIES 3'249'303 703'695 86'349 88'473 ANNUAL REPORT 2023 | 35 Receivables and debts from credit institutions include transactions with banks of the Edmond de Rothschild Group and are recorded in the following table: Headings (in thousands of euros) Total Receivables from credit institutions 1'797'899 Due to credit institutions 187'409 The balance of assets largely corresponds to the investment of the surplus of resources over uses, with counterparty risk being regularly analysed by the Bank's Board of Directors. Receivables from clients are recorded on the balance sheet at their nominal value. 3.2. Table of subsidiaries and holdings Subsidiaries and holdings (in thousands of euros) Share capital Acquisition cost Share of capital held 2023 revenue 2023 income Dividends received during 2023 Reserves before allocation of 2023 income Retained earnings before allocation of 2023 income Edmond de Rothschild Assurances et Conseils Monaco SAM created on 26/10/2005 150 0,15 100 % 2’921 1’116 1’204 15 1’338 Edmond de Rothschild Gestion Monaco SAM created on 11/12/2008 250 0,25 100 % 16’061 13’293 15'256 15 1’286 3.3. Fixed assets As at 31 December 2023, fixed assets broke down as in the tables below: Types of fixed asset (in thousands of euros) Gross amount at start of 2023 financial year Acquisitions 2023 Disposals 2023 Depreciation expenses 2023 Accumulated depreciation or amortisation as at 31/12/2023 Residual value at the end of the financial year Intangible assets Goodwill 4'258 457 3'801 Leasehold rights 3'888 3'888 Software & licences 16'939 3'854 2'721 14'998 5'795 Miscellaneous deposits 3'586 1'946 5'412 120 Sub-total 28'671 5'800 5'412 2'721 15'455 13'604 Property, plant and equipment Fixtures, facilities and other tangible fixed assets 19'117 912 8'043 1'418 9'351 2'635 Miscellaneous deposits 735 735 Sub-total 19'117 1'647 8'043 1'418 9'351 3'370 Total Fixed Assets 47'788 7'447 13'455 4'139 24'806 16'974 EDMOND DE ROTHSCHILD (MONACO) | 36 All of these fixed assets are used for the Bank's own activities. The Bank initiated a phase of adaptation of its IT system in preceding years, which led to €5.4 million in scrapping and €2.7 million in new investments in assets in progress. Concerning other financial fixed assets, this item includes partner certificates constituting non-voting capital securities on the Deposit Guarantee and Resolution Fund reserves, as well as association certificates constituting a claim on the Deposit Guarantee and Resolution Fund, subordinated and indefinite-term. 3.4. Shareholders' equity As at 31 December 2023, the Bank had capital of €13,900,000 consisting of 86,875 shares with a par value of €160. The Bank's shareholders' equity, as at 31 December 2023, and after including the earnings, totalled €213,267,000. Headings (in thousands of euros) Shareholders' equity at 31/12/2022 2023 capital increase Allocation of 2022 income Shareholders' equity at 31/12/2023 Share capital 13'900 13'900 Statutory reserve 1'390 0 1'390 Optional reserve 112'221 14’900 127'121 Issue premium 18'149 18'149 Retained earnings 22 -7 15 Income (loss) for the year 37'219 52'692 Total 182'901 0 14’893 213'267 Earnings per share 0,43 0,61 3.5. Provisions Provisions as at 31 December 2023 were €2,402,000 and consist of : Headings (in thousands of euros) Gross value at the beginning of financial year 2023 Allocations as at 31/12/2023 Write-backs as at 31/12/2023 Balance as at 31/12/2023 Provisions for pension expenses 420 68 488 Other provisions for risks 1'250 1'494 829 1'915 Total provisions for risks and expenses 1'670 1'562 829 2'403 Commitments covered by a provision for retirement are valued annually and amounted to €488,000 as at 31/12/2023. Provisions for client risks are established according to the risks of losses as soon as they are known. They are deducted from assets when they relate to doubtful loans, otherwise they are incorporated into liabilities. At 31/12/2023, the risk assessment for loans classified as doubtful loans did not result in a provision for risk of losses. ANNUAL REPORT 2023 | 37 3.6. Adjustment accounts and miscellaneous The table below provides details of the adjustment accounts and other asset and liability accounts by transaction category: Headings (in thousands of euros) Asset accounts Liability accounts Off-balance sheet foreign exchange income -358 Prepaid expenses 967 Miscellaneous income receivable 2'292 Accrued expenses - personnel 11'392 Accrued expenses - suppliers 0 6'447 Accrued expenses - business introducers 2'367 Miscellaneous 412 6'619 Total adjustment accounts 3'313 26'825 Securities transaction settlement accounts 2'892 9'581 Miscellaneous debtors 2'686 Security deposits paid 46'263 Miscellaneous creditors 4'809 Collateral deposits received 16'009 Tax payable to the tax authorities 6'894 Total other 51'841 37'293 3.7. Euro equivalent of foreign currency assets and liabilities Exchange value in thousands of euros Exchange value in thousands of euros Total assets 1'698'832 Total liabilities 1'698'834 EDMOND DE ROTHSCHILD (MONACO) | 38 4. INFORMATION ON OFF-BALANCE SHEET ITEMS 4.1. Foreign Exchange contracts not settled as at 31 December 2023 Headings (in thousands of euros) To be received To be delivered Euros purchased not received 3’616 Currencies purchased not received 3'356 Euros sold not delivered 2’956 Currencies sold not delivered 4’008 Total foreign exchange spot transactions 6'972 6'964 Euros receivable, currencies to be delivered 171'187 628'481 Currency receivable, euros to be delivered 627'179 170'112 Currency receivable, currency to be delivered 68'131 68'116 Total foreign exchange forward transactions 866'497 866'709 The transactions recorded here do not indicate that the Bank has a significant proprietary position. 4.2. Transactions on conditional foreign exchange instruments (in thousands of euros) Call purchases 12'338 Put purchases 20’000 Call sales 12'338 Put sales 20’000 For these transactions, the Bank/Management Company only acts on the markets as an intermediary and only on behalf of its clients, as transactions are systematically backed by a banking counterparty. All transactions are carried out over-the-counter. ANNUAL REPORT 2023 | 39 5. INFORMATION ON INCOME STATEMENT ITEMS 5.1. Breakdown of the interest margin for the 2023 financial year Headings (in thousands of euros) Expenses Products Credit institutions 1'041 93'334 Clients 107'569 83'747 Total interest 108'610 177'081 The interest margin reflects the difference between the income generated by loans granted to clients, as well as Cash placements, and the cost of deposits. 5.2. Breakdown of commissions for the 2023 financial year Headings (in thousands of euros) Expenses Products Delegation of financial management 15'588 0 Foreign exchange transactions 14 14 Securities transactions on behalf of clients 2'119 35'849 Other financial services 1’180 11'865 Other miscellaneous client transactions 0 12'667 Total commissions 18'901 60'395 The income is collected from clients. Commissions paid mainly represent costs incurred on behalf of clients with the various financial intermediaries, credit institutions or others. A delegation of financial management agreement between the Bank and its subsidiary Edmond de Rothschild Gestion Monaco was signed on 1st September 2013. 5.3. Gains on trading book transactions This item reflects the result of the following transactions: - Transactions to buy and sell securities carried out by the Bank, mainly on the bond markets totalling €6,540,000; - Foreign exchange transactions totalling €4,067,000; - Transactions on financial instruments for €20,000. EDMOND DE ROTHSCHILD (MONACO) | 40 5.4. Other banking operating income and expenses Headings (in thousands of euros) 2023 2022 Miscellaneous commission retrocessions 840 264 Other ancillary income 511 580 Expenses recharged to Group companies 863 780 Transfer of NB operating expenses 32 21 Other operating income 95 76 Total Income 2'341 1'721 Business introducers & external managers 5'855 4'472 Guarantee fund premiums 79 77 Other operating expenses 637 607 Total Expenses 6'571 5'156 An agreement for the provision of personnel and technical resources between the Bank and its subsidiary Edmond de Rothschild Gestion was signed on 1st September 2013, as well as with its other subsidiary Edmond de Rothschild Assurances et Conseils on 2nd January 2014. 5.5. General operating expenses - personnel costs The change in personnel costs during the 2023 financial year was as follows: Headings (in thousands of euros) 2023 2022 Wages and salaries 28'433 27'557 Pension expenses 3'403 3'298 Other social security expenses 5'484 5'454 Vocational training 96 118 Total personnel costs 37'416 36'427 The provision for paid leave, established in accordance with the regulations in force and incorporated into the Adjustment Accounts items on the Balance Sheet, has been updated according to the number of employees and their leave rights as at 31 December 2023. The corresponding additional provision was booked as a charge under Personnel expenses. 5.6. Cost of risk Headings (in thousands of euros) 2023 2022 Allocations to provisions for risks and charges -1'562 -491 Allowances for miscellaneous and personnel risks 0 0 Write-backs on provisions for risks and charges 0 0 Write-backs for miscellaneous and personnel risks 829 238 Total -733 -253 The cost of risk includes allocations and write-backs primarily related to the clients and personnel risks. ANNUAL REPORT 2023 | 41 5.7. Exceptional revenue and expenses Exceptional expenses -263 K€ Exceptional revenue 9 K€ Exceptional profit/loss -254 K€ 6. OTHER INFORMATION 6.1. The Bank's workforce totalled 214 people as at 31 December 2023 Workforce 2023 2022 Executives 143 137 Non-executive 71 68 Total 214 205 6.2. Summary of the Bank's earnings for the last 5 years Income (in thousands of euros) 2019 19’726 2020 23’750 2021 27’096 2021 37’219 2023 52’692 6.3. Prudential ratios 6.3.1. European solvency ratio The Bank calculates its ratio in accordance with the requirements of Regulation (EU) No. 575/2013 (Capital Requirements Regulation or CRR). Our Group uses the standardised approach to calculate its capital requirements. This ratio is used to measure the ratio between the bank's capital and all the risks incurred by the bank, with the risks weighted according to the solvency risk of the beneficiaries, and must be equal to at least 10.50%, a limit broadly observed by our Group as at 31 December 2023. 6.3.2. Liquidity ratio The Bank has a strong liquidity position with a liquidity coverage ratio (LCR) well above the 100% expected for the year ended 31 December 2023. 6.3.3. Control of large exposures The objective of the banking regulations is to spread the risks of each banking institution and to ensure that each risk is proportional to its capital base so that it is always able to withstand a company's default (see Regulation (EU) 575/2013). The Bank complies with all requirements. 6.3.4. Risk management Through the framework of its ALM Committee, the Bank adopts an asset/liability maturity matching policy to meet the requirements for managing interest rate risk and liquidity risk. 6.4. Reserve requirements In accordance with Regulation (EC) No 1745/2003 of the European Central Bank, as amended, the Bank maintains the monthly minimum reserves. EDMOND DE ROTHSCHILD (MONACO) | 42 Resolutions Adopted at the Ordinary General Meeting of 22 March 2024 FIRST RESOLUTION Approval of the corporate accounts The Ordinary General Meeting: (i) approves, as presented to it, the financial statements for the financial year ended 31 December 2023, i.e. the balance sheet, the income statement and the notes, which result in net accounting income of €52,692,210.66; (ii) approves the terms of the Board of Directors’ report on the financial statements for the financial year ended 31 December 2023 and the terms of the statutory auditors’ general report on said financial statements; (iii) accordingly gives discharge to the directors and statutory auditors of the performance of their duties for the last year; (iv) gives François Pauly, who resigned as director, full and final discharge of his management duties during the period from 1 January to 23 March 2023. This resolution was put to a vote and adopted unanimously. SECOND RESOLUTION Allocation of income The Ordinary General Meeting: (i) notes that the distributable profit is as follows: 2023 profit 52'692'210,66 Previous retained earnings 14'664,42 Distributable profit 52'706'875,08 (ii) decides to allocate the distributable profit as follows: Distribution of a dividend of €405 per share For 86,875 shares 35'184'375,00 Allocation to the optional reserve 17'500'000,00 Retained earnings 22’500,08 Total 52'706'875,08 Cette résolution, mise aux voix, est adoptée à l’unanimité THIRD RESOLUTION Approval of the consolidated annual financial statements Having read the report by the Board of Directors and the report by the statutory auditors on the consolidated annual financial statements for the financial year ended 31 December 2023, the General Meeting of Shareholders approves, as presented to it, the consolidated financial statements for the financial year ended 31 December 2023, i.e. the balance sheet, the income statement and the notes, resulting in net accounting income for the entire Group of €50,743,613.82. Cette résolution, mise aux voix, est adoptée à l’unanimité FOURTH RESOLUTION Approval of the transactions referred to in Article 23 of the Sovereign Ordinance of 5 March 1895 Having read the report by the Board of Directors and the special report by the statutory auditors on the transactions referred to in Article 23 of the Sovereign Ordinance of 5 March 1895, the General Meeting: - approves the agreements referred to therein, and - renews for the directors, for the current financial year, the authorisation provided for in Article 23 of the Sovereign Ordinance of 5 March 1895. Cette résolution, mise aux voix, est adoptée à l’unanimité FIFTH RESOLUTION Approval of the amount of statutory auditors' fees The General Meeting approves the amount of the statutory auditors' fees for the financial year ended 31 December 2023, as shown in the financial statements for the financial year mentioned above. Cette résolution, mise aux voix, est adoptée à l’unanimité ANNUAL REPORT 2023 | 43 SIXTH RESOLUTION Determining directors' fees Having read the report by the Board of Directors, the General Meeting sets the total budget for directors' fees allocated to directors for the performance of their term of office during the financial year ended 31 December 2023 at the sum of €6,300. This resolution was put to a vote and adopted unanimously. SEVENTH RESOLUTION Renewal of a director’s mandate Having read the report by the Board of Directors, the General Meeting decided to renew the term of office of Hervé Ordioni for a period of one year, i.e. until the end of the annual Ordinary General Meeting called to approve the financial statements for the financial year ending 31 December 2024. This resolution was put to a vote and adopted unanimously. Hervé Ordioni states that he accepts the duties assigned to him and that he is not subject to any legal prohibition relating to the exercise of said duties. EIGHTH RESOLUTION Renewal of a director’s term of office Having read the report by the Board of Directors, the General Meeting decided to renew the term of office of Cynthia Tobiano for a period of one year, i.e. until the end of the annual Ordinary General Meeting called to approve the financial statements for the financial year ending 31 December 2024. This resolution was put to a vote and adopted unanimously. Cynthia Tobiano states that she accepts the duties assigned to her and that she is not subject to any legal prohibition relating to the exercise of said duties. NINTH RESOLUTION Renewal of a director’s mandate Having read the report by the Board of Directors, the General Meeting decided to renew the term of office of Philippe Cieutat for a period of one year, i.e. until the end of the annual Ordinary General Meeting called to approve the financial statements for the financial year ending 31 December 2024. This resolution was put to a vote and adopted unanimously. Philippe Cieutat states that he accepts the duties assigned to him and that he is not subject to any legal prohibition relating to the exercise of said duties. TENTH RESOLUTION Renewal of a director’s term of office Having read the report by the Board of Directors, the General Meeting decided to renew the term of office of Jean Laurent-Bellue for a period of one year, i.e. until the end of the annual Ordinary General Meeting called to approve the financial statements for the financial year ending 31 December 2024. This resolution was put to a vote and adopted unanimously. Jean Laurent-Bellue states that he accepts the duties assigned to him and that he is not subject to any legal prohibition relating to the exercise of said duties. ELEVENTH RESOLUTION Renewal of a director’s term of office Having read the report by the Board of Directors, the General Meeting decided to renew the term of office of Tobias Guldimann for a period of one year, i.e. until the end of the annual Ordinary General Meeting called to approve the financial statements for the financial year ending 31 December 2024. This resolution was put to a vote and adopted unanimously. Tobias Guldimann states that he accepts the duties assigned to him and that he is not subject to any legal prohibition relating to the exercise of said duties. TWELFTH RESOLUTION Power of attorney for formalities The General Meeting grants all powers to the bearer of an original, copy or extract of these minutes, to carry out all filings and formalities required by the legal and regulatory provisions in force. EDMOND DE ROTHSCHILD (MONACO) | 44 Addresses Edmond de Rothschild (Suisse) S.A. Head office GENEVA Edmond de Rothschild (Suisse) S.A. Rue de Hesse 18 - 1204 Genève T. +41 58 818 91 11 Branches FRIBOURG Edmond de Rothschild (Suisse) S.A. Succursale de Fribourg Place de la Gare 5 - 1700 Fribourg T. +41 26 347 24 24 LAUSANNE Edmond de Rothschild (Suisse) S.A. Succursale de Lausanne Avenue Agassiz 2 - 1002 Lausanne T. +41 21 318 88 88 LUGANO Edmond de Rothschild (Suisse) S.A. Succursale di Lugano Via Ginevra 2 - 6900 Lugano T. +41 91 913 45 00 Branch ZURICH Edmond de Rothschild (Suisse) S.A. Beethovenstrasse 11 - 8002 Zurich T. +41 44 818 81 11 Subsidiaries in Switzerland Edmond de Rothschild REIM (Suisse) S.A. Rue du Rhône 30 - 1204 Genève T. +41 22 436 32 40 Foreign subsidiaries and offices GERMANT Edmond de Rothschild REIM (Germany) GmbH Anna-Louisa-Karsch-Strasse 3 10178 Berlin T. +49 30 374 36 38-20 Edmond de Rothschild REIM (Germany) GmbH Taunusanlage 16 60325 Frankfurt-am-Main T. +49 69 743 03 88-0 Edmond de Rothschild REIM (Germany) GmbH Müllerstrasse 27 - 80469 München T. +49 89 52 03 56 20 UNITED ARAB EMIRATES Edmond de Rothschild (Middle East) Ltd. ICD Brookfield Place, Level 31, Unit L31.09 Dubai International Financial Centre P.O. Box 506938 Dubaï, United Arab Emirates T. +971 4 329 21 42 Edmond de Rothschild (Suisse) S.A., Banking Representative Office The Maze Tower-902 Trade Centre Second Sheikh Zayed Road P.O. Box 214924 Dubaï, United Arab Emirates T. +971 4 346 53 88 FRANCE Edmond de Rothschild (France) (Détails en pages suivantes) Edmond de Rothschild REIM (France) S.A.S. 35, boulevard des Capucines 75002 Paris T. +33 1 40 06 00 00 ISRAEL Edmond de Rothschild (Israel) Ltd. 20 Rothschild Boulevard 6688123 Tel Aviv T. +972 3 713 03 00 LUXEMBOURG Edmond de Rothschild (Europe) (Détails en pages suivantes) Edmond de Rothschild Private Equity Luxembourg S.A. 4, rue Robert Stumper L-2557 Luxembourg T. +352 26 74 22-1 MONACO Edmond de Rothschild (Monaco) Les Terrasses - 2, avenue de Monte-Carlo BP 317 - 98006 Monaco Cedex T. +377 93 10 47 47 Edmond de Rothschild Assurances et Conseils (Monaco) Filiale d’Edmond de Rothschild (Monaco) Les Terrasses - 2, avenue de Monte-Carlo BP 317 - 98006 Monaco Cedex T. +377 97 98 28 00 Edmond de Rothschild Gestion (Monaco) Filiale d’Edmond de Rothschild (Monaco) Les Terrasses - 2, avenue de Monte-Carlo BP 317 - 98006 Monaco Cedex T. +377 97 98 22 14 THE NETHERLANDS Edmond de Rothschild REIM (Benelux) BV Gustav Mahlerplein 121-123 1082 MS Amsterdam T. +31 20 575 50 80 UNITED KINGDOM Edmond de Rothschild (UK) Limited Edmond de Rothschild Asset Management (UK) Limited Edmond de Rothschild Capital Holdings Limited Edmond de Rothschild Private Merchant Banking LLP 4, Carlton Gardens London SW1Y 5AA T. +44 20 7845 5900 Edmond de Rothschild REIM (UK) Limited 18, Savile Row London W1S 3PW T. +44 20 3206 7910 URUGUAY Edmond de Rothschild (Suisse) S.A. Representación Uruguay* World Trade Center Montevideo Torre II – Piso 21 Avenida Luis Alberto de Herrera 1248 11300 Montevideo T. +598 2 623 24 00 * In March 2022, the Group decided to close this entity. Therefore, the liquidation process was initiated. ANNUAL REPORT 2023 | 45 Addresses Edmond de Rothschild (Europe) Head Office LUXEMBOURG Edmond de Rothschild (Europe) 4, rue Robert Stumper L-2557 Luxembourg T. +352 24 88 1 Subsidiaries LUXEMBOURG Edmond de Rothschild Assurances et Conseils (Europe) 4, rue Robert Stumper L-2557 Luxembourg T. +352 26 26 23 92 Edmond de Rothschild Asset Management (Luxembourg) 4, rue Robert Stumper L-2557 Luxembourg T. +352 24 88 27 32 Joint venture JAPON Edmond de Rothschild Nikko Cordial Co., Ltd 3-3-1, Marunouchi, Shintokyo Bld. 3F, Chiyoda-ku, Tokyo #100-0005 T. +81 3 3283-3535 Branches abroad BELGIUM Head branch in Brussels Edmond de Rothschild (Europe) Succursale en Belgique Avenue Louise 235 – Lobby A 1050 Bruxelles T. +32 2 645 57 57 Antwerp branch Edmond de Rothschild (Europe) Frankrijklei 103 2000 Antwerpen T. +32 3 212 21 11 SPAIN Edmond de Rothschild (Europe) Sucursal en España Avinguda Diagonal, 618, 9a 08021 Barcelona T. +34 93 823 34 09 Edmond de Rothschild (Europe) Sucursal en España Paseo de la Castellana 55 28046 Madrid T. +34 91 364 66 00 PORTUGAL Edmond de Rothschild (Europe) Sucursal em Portugal Rua Dom Pedro V 130 1250-095 Lisbonne T. +351 21 045 46 60 EDMOND DE ROTHSCHILD (MONACO) | 46 Addresses Edmond de Rothschild (France) Head office FRANCE Edmond de Rothschild (France) 47, rue du Faubourg Saint-Honoré 75401 Paris Cedex 08 T. +33 1 40 17 25 25 Representative offices BORDEAUX Edmond de Rothschild (France) Hôtel de Saige 23, cours du Chapeau Rouge 33000 Bordeaux T. +33 5 56 44 20 66 LILLE Edmond de Rothschild (France) 116, rue de Jemmapes 59800 Lille T. +33 3 62 53 75 00 LYON Edmond de Rothschild (France) 27, rue Auguste Comte 69002 Lyon T. +33 4 72 82 35 25 MARSEILLE Edmond de Rothschild (France) 165, avenue du Prado 13272 Marseille T. +33 4 91 29 90 80 NANTES Edmond de Rothschild (France) 20, rue de la Contrescarpe 44000 Nantes T. +33 2 53 59 10 00 STRASBOURG Edmond de Rothschild (France) 6, avenue de la Marseillaise 67000 Strasbourg T. +33 3 68 33 90 00 TOULOUSE Edmond de Rothschild (France) 22, rue Croix Baragnon 31000 Toulouse T. +33 5 67 20 49 00 Subsidiaries in France PARIS Edmond de Rothschild Asset Management (France) 47, rue du Faubourg Saint-Honoré 75401 Paris Cedex 08 T. +33 1 40 17 25 25 Edmond de Rothschild Corporate Finance 47, rue du Faubourg Saint-Honoré 75401 Paris Cedex 08 T. +33 1 40 17 21 11 Edmond de Rothschild Private Equity (France) 47, rue du Faubourg Saint-Honoré 75401 Paris Cedex 08 T. +33 1 40 17 25 25 Edmond de Rothschild Assurances et Conseils (France) 47, rue du Faubourg Saint-Honoré 75401 Paris Cedex 08 T. +33 1 40 17 22 32 COGIFRANCE 63, rue La Boétie 75008 Paris T. +33 1 45 61 65 00 Subsidiaries abroad GERMANY Edmond de Rothschild Asset Management (France), Niederlassung Deutschland Main Building Taunusanlage 16 60325 Frankfurt am Main T. +49 69 244 330 200 CHINA Zhanghai Fund Management Co Ltd. 29F Shidaijinrong Center 68 Yincheng Middle Road Pudong 200120 Shanghai SPAIN Edmond de Rothschild Asset Management (France), Sucursal en España Paseo de la Castellana 55 28046 Madrid T. +34 91 789 32 20 ITALY Edmond de Rothschild (France) Succursale italiana Corso Venezia 36 20121 Milano T. +39 02 76 061 200 UNITED KINGDOM Edmond de Rothschild Asset Management (France) 4, Carlton Gardens London SW1 5AA T. +44 20 7845 5900 EDMOND DE ROTHSCHILD (MONACO) | RAPPORT ANNUEL 2023RAPPORT ANNUEL2023EDMOND DE ROTHSCHILD (MONACO)
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