2007 REGISTRATION DOCUMENT

CONSOLIDATED FINANCIAL STATEMENTS5Notes to the financial s tatements p repared in accordance with I nternational Financial Reporting S tandards as adopted by the European Union< Contents >These adjustments reduced the Group share of BNL’s equity at31 March 2006 by the same amount, and gave rise to residual goodwillof EUR 2,295 million at 5 April 2006, the date BNP Paribas obtainedeffective control of BNL.In accordance with the accounting policies described in note 1.c.7,“Own equity instruments and own equity instrument derivatives”,the difference between the acquisition cost and the Group’s equityin BNL’s net assets held by minority shareholders and acquired afterthe date of acquisition (i.e. between 5 April 2006 and 31 December2006) was recorded as a deduction from retained earnings attributableto BNP Paribas shareholders in an amount of EUR 2,224 million at31 December 2007.BNP Paribas financed the BNL acquisition by means of (i) aEUR 5,467 million issue of shares with pre-emptive subscription rightsfor existing shareholders; (ii) a EUR 2,023 million issue of undatedsuper subordinated notes; and (iii) its own funds. Details of these issuesare provided in note 8.a, “Changes in share capital and earnings pershare”.12The table below shows (i) BNL’s consolidated balance sheet at 31 March 2006 prepared in accordance with IFRS before taking into account the controllinginterest acquired by the Group in its capital; and (ii) BNL’s Balance sheet at the same date after adjustments recorded to comply with applicable rules onbusiness combinations as prescribed by IFRS and with BNP Paribas Group accounting policies.31 March 2006 31 March 2006In millions of eurosAfter acquisition-relatedadjustments Prior to acquisitionASSETSFinancial assets at fair value through profi t or loss 7,730 7,541Available-for-sale fi nancial assets 1,160 1,157Loans and receivables due from credit institutions 8,705 8,705Loans and receivables due from customers 63,860 63,763Property, plant & equipment and intangible assets 2,682 2,600Non-current assets held for sale - 850Other assets 5,318 4,284TOTAL ASSETS 89,455 88,900LIABILITIESFinancial liabilities at fair value through profi t or loss 8,303 8,007Due to credit institutions 10,549 10,549Due to customers 37,085 37,100Debt securities 20,509 20,199Non-current liabilities held for sale - 784Other liabilities 8,534 6,909TOTAL LIABILITIES 84,980 83,548CONSOLIDATED EQUITYShareholders’ equity 4,434 5,311Minority interests 41 41TOTAL CONSOLIDATED EQUITY 4,475 5,352TOTAL LIABILITIES AND EQUITY 89,455 88,900345678The BNL sub-group has been fully consolidated as from the acquisitiondate. For the last three quarters of 2006 BNL contributed EUR 294 millionto the BNP Paribas Group’s net income and EUR 248 million to netincome attributable to equity holders.If the acquisition had taken place on 1 January 2006, the BNL sub-groupwould have contributed EUR 3,036 million to net banking income andEUR 395 million to net income for the full year. This acquisition led toa net cash outflow of EUR 11,490 million for the BNP Paribas Groupin 2006.The Extraordinary General Meeting of BNP Paribas SA shareholderson 15 May 2007 approved BNL’s merger into the Group, to be carriedout by BNL transferring to BNP Paribas all of its assets in return forBNP Paribas assuming all of BNL’s liabilities (twelfth resolution). Thistransaction was completed on 1 October 2007, and involved a link-upbetween the branches owned by BNL outside Italy and any BNP Paribasbranches located in these countries. In the United States, the Groupobtained an agreement in principle from the US tax authorities allowingthe transaction to benefit from tax neutrality. Under the agreement,BNP Paribas may allocate tax losses carried forward by BNL New Yorkagainst future taxable profits of its New York branch. In view of theconditions set out in the agreement and the US tax rules governingutilizations of loss carryforwards resulting from a merger and change incontrol, the Group recognised EUR 124 million in tax assets.910112007 Registration document - BNP PARIBAS 209