ATRADIUS CRÉDITO YCAUCIÓN S.A. DE SEGUROSY REASEGUROSAnnual Statements and Management Report for the financial year
closed on December 31, 2022
Together with the Independent Audit ReportAll amounts are in millions of Euros, unless otherwise stated

Independent Audit Report on the Annual Financial Statements

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

ATRADIUS CRÉDITO Y CAUCIÓN S.A.
DE SEGUROS Y REASEGUROSAnnual Financial Statements and Management Report for the financial year
ended on December 31, 2022

All amounts are in millions of Euros, unless otherwise stated

Annual Statements for the financial
year 2022

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Balance Sheets at 31 December 2022 and 2021
(Thousands of Euros)
31.12.2021 (1)31.12.2022

Assets

Nota

Cash and cash equivalents

8.1

399,682

347,323

Available-for-sale financial assets

8.2

1,781,248

1,671,196

Equity instruments-

303,803

394,133

Debt securities-

1,477,445

1,277,063

Loans and receivables-

480,646457,747

Loans

8.2

-

-

Deposits in credit institutions

8.2

43,07360,015

Deposits made for accepted reinsurance

10

2,320

3,201

Receivables on direct insurance operations

10

119,394

108,351

Policyholders-

98,23789,067

Brokers-

21,157

19,284

Receivables on reinsurance operations

10

111,881

91,092Other receivables

10

203,978

195,088

Tax receivables

-

717

316

Rest of receivables-

203,261

194,772

Reinsurance share on technical provisions

16

888,962

944,539

Provision for unearned premiums-

272,430

300,417

Provision on claims-

616,532

644,122

Property, plant and equipment and investment property

668,82273,987

Property, plant and equipment-

61,631

71,689Investment property

-

7,191

2,298

Intangible assets

5105,985

97,471

Goodwill-

13,71318,319Other intangible assets-

92,272

79,152

Holdings in Group companies and associates

916,493

16,493

Holdings in Group companies-

16,493

16,493

Tax assets

12244,884

187,226

Current tax assets-

51,38817,261

Deferred tax assets-

193,496

169,965

Other assets-

366,695

307,700

Assets and reimbursement rights for long-term staff remuneration

14.1

88,505

95,157

Accrual accounts-

278,190

212,543

Total assets-

4,353,417

4,103,682(1) Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance sheet at 31
December 2022. Both in the current year and in the previous year, other technical provisions of the ceded business have been reclassified to provisions for profit sharing andreturns.

All amounts are in millions of Euros, unless otherwise stated

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Balance Sheets at 31 December 2022 and 2021
(Thousands of Euros)
Liabilities

Nota

31.12.2022

Debts and payables

11

Deposits received for ceded reinsurance

0

9,903

11,556

Payables on insurance operations

0

74,08969,482

Payables to insureds

041,92541,515

Payables to brokers

018,532

15,194

Conditional payables

396,137

31.12.2021 (1)579,668

0

13,632

12,773

Payables on reinsurance operations

0

182,534

376,670

Other accounts payable:

0129,611

121,960

Tax payables

0

7,616

6,813

Other accounts payable to Group companies and associates

18.1

49,31541,314

Rest of other accounts payable

072,68073,833

Technical provisions

16

2,004,525

1,637,764

Provision for unearned premiums

0

701,723

641,731

Claims provision0

1,238,688

959,898

Provision for profit sharing and for return premiums

064,11436,135

Non-technical provisions

14

60,450101,260

Provision for pensions and similar obligations

0

59,47598,752Other non-technical provisions

0

975

2,508

Tax liabilities

12

252,199

251,512Current tax liabilities

043,51927,026

Deferred tax liabilities

0208,680

224,486

Other liabilities

0173,345

183,703

Accrual accounts

065,926

63,961

Commissions and other acquisition costs of ceded reinsurance

0

107,419

119,742

Total liabilities

2,886,656

2,753,907

Equity000Shareholder funds

17

1,530,666

1,289,148

Capital or mutual fund024,87024,870Share premium

0

1,231

1,231

Reserves

0

1,398,101

1,072,317

Legal and bylaws reserves

0

17,40917,409Equalization reserve

0

800,488630,530

Other reserves

0580,204

424,378

Other shareholder contributions

0

60,00060,000Result for the year

0216,422

132,372(Interim dividend and interim equalization reserve)0(169,958)(1,642)

Valuation adjustments:

0(63,905)

60,627Available-for-sale financial assets

0(37,232)

80,003

Exchange and translation differences

0(26,673)(19,376)

Total equity

0

1,466,761

1,349,775

4,353,417

4,103,682

Total liabilities and equity(1) Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance sheet at 31
December 2022. Both in the current year and in the previous year, other technical provisions of the ceded business have been reclassified to provisions for profit sharing andreturns.

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Profit and loss Statements for the years ended 31 December 2022 and 2021
(Thousands of Euros)
Technical account – Non-life insurance

Nota

2022

2021 (1)Premiums Attributed to the Year, Net of Reinsurance

0

1,022,691

512,236

Earned premiums

0

1,880,367

1,642,879

Direct insurance

15

1,760,973

1,550,193

Accepted reinsurance

15

124,452

95,571

Change in impairment losses on uncollected premiums (+ /-)0(5,058)(2,885)

Ceded reinsurance premiums

15(767,448)(989,065)

Change in the provision for unearned premiums and for unexpired risks (+/-)

16.1(62,636)(64,415)

Direct insurance

0(64,742)(62,407)

Accepted reinsurance

0

2,106

(2,008)Change in the provision for unearned premiums, ceded reinsurance (+/-)

16.1(27,592)(77,163)

Income from property, plant and equipment and from investments

023,80833,554

Income from investment property

6

518

291

Income from financial investments

0

23,29033,263

Other technical income

16.3

57,78453,948Claims for Year, Net of Reinsurance

0(521,914)(213,635)

Claims and expenses paid

0(184,415)(70,048)

Direct insurance

0(394,411)(255,904)

Accepted reinsurance

0(12,188)(21,272)

Ceded reinsurance

0

222,184

207,12816.1(295,702)(102,107)

Direct insurance

0(244,373)(51,212)

Accepted reinsurance

0(31,207)(47,956)

Ceded reinsurance

Variation in the claims provision (+/-)

0(20,122)(2,939)

Expenses attributable to claims

0(41,797)(41,480)

Profit sharing and for return premiums

0(27,972)(14,649)

Variation in the provision for profit sharing and for return premiums (+/-)

16.3(27,972)(14,649)

Net Operating Expenses

0(279,328)(172,450)

Acquisition costs

16.3(225,305)(189,788)

Administration costs

16.3(376,766)(388,793)

Commissions and profit sharing on ceded reinsurance and retrocession

13.3

322,743

406,131

Other Technical Expenses

16.3

(225)

(397)

Expenses on property, plant and equipment and investments

0(6,163)(6,325)Investment management expenses

0(5,592)(3,754)

Espenses on investment property

0

(318)

(207)

Expenses on investments and financial accounts

0(5,274)(3,547)

Valuation adjustments of property, plant and equipment and investments

0

(571)

(2,571)

Impairment of property, plant and equipment and investment property

6

(158)

(45)

Impairment of financial investments

8.2

(413)

(2,526)

268,681

192,282

Subtotal (Result of Non-Life Insurance Technical Account)(1) Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance sheet at 31 December 2022. Both in the current
year and in the previous year, other technical provisions of the ceded business have been reclassified to provisions for profit sharing and returns.

All amounts are in millions of Euros, unless otherwise stated

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Profit and loss Statements for the years ended 31 December 2022 and 2021
(Thousands of Euros)
2022

2021 (1)Income from property, plant and equipment and from investments

35,192

2,998

Gains on sale of property, plant and equipment and investments

35,192

2,998

Of property, plant and equipment and investment property

3,839

-

31,353

2,998

Expenses on property, plant and equipment and investments(19,753)(991)

Losses on property, plant and equipment and investments(19,753)(991)(1,039)(240)(18,714)

(751)

6,340

2,795

6,340

2,795

21,7794,802

290,461

197,083(74,039)(64,711)

216,422

132,372

Non-Technical AccountOf financial investments

Nota

8.2

On property, plant and equipment and investment property
On financial investments

8.2

Other expenses
Rest of expenses

13.3

Subtotal (Result of Non-Technical Account)
Profit before tax
Corporate Income Tax
Net Profit for the Year

(1)

12

Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of thebalance sheet at 31 December 2022.

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Statement of Changes in Equity in 2022 and 2021
A) Statement of Recognised Income and Expense(Thousands of Euros)
2022

2021 (1)

216,422

132,372

Available-for-sale financial assets(155,629)

34,628Valuation gains/(losses)(143,403)

35,911

Amounts transferred to profit or loss

(12,226)(1,283)

Valuation gains/(losses)(7,431)

10,694

Valuation gains/(losses)(7,431)

10,694

Actuarial gains/(losses) on pension benefits

36,00938,936

Actuarial gains/(losses) on pension benefits

36,00938,936

Corporate income tax

27,562(17,560)

Total recognised income and expense

116,933

199,070

Result for the year
Other recognised income and expense

1)
Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance
sheet at 31 December 2022.

All amounts are in millions of Euros, unless otherwise stated

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Statements of Changes in Equity in 2022 and 2021
B) Statement of Changes in Total Equity (Thousands of Euros)
Authorised ShareLegal
and Equalization
capitalpremium bylaws
reserve
reserves

Voluntary Revaluation
reserve and reserve
otherreserves

Reserve for Shareholders Result for Interim
actuarial
contribution the year
equalization
gains andreservelossesValuation
Total
adjustments

Balances at 1 January 2021
24,870Total recognised
income/(expenses)
Transactions with shareholders or
mutual soc. members
-

1,231

17,409628,888473,668

5,552(170,818)-

86,767(1,564)24,704

1,090,707

-

-

-

-

-

30,774-132,371-

35,923

199,068

-

-

-

-

-

-

60,000---60,000

Redistribution of capital

-

-

-

-

-

-

-

60,000---60,000

Other changes in equity

-

-

-

1,642

4,211

-

80,992-(86,767)

(78)

-

-

Transfers between equity captions -

-

-

-

85,203---(86,767)

1,564

-

-

Other changes
Balances at 31 December 2021

24,8701,231

17,4091,642
630,530(80,992)
477,879

5,552

80,992(59,052)

60,000132,371(1,642)(1,642)60,627

1,349,775

-

-

-

-

-

-

-

-

-

-

-

-

Balances at 1 January 2022
Total recognised
income/(expenses)

24,8701,231

17,409630,530

477,879

5,552(59,052)

60,000132,371(1,642)60,627

1,349,775

-

-

-

-

-

-

25,042-

216,422-(124,532)

116,933

Transactions with shareholders or
mutual soc. members
-

-

-

-

-

-

-

-

-

-

-

-

Redistribution of capital

-

-

-

-

-

-

-

-

-

-

-

-

Other changes in equity

-

-

-

169,958

130,783---(132,371)(168,316)-

54

Transfers between equity captions -

-

-

-

130,729---(132,371)

1,642

-

-

1,231

17,409169,958
800,48854
608,661

5,552(34,010)60,000216,422(169,958)(169,958)(63,905)54
1,466,761(2)

Other changes
Balances at 31 December 2022

24,870(1) Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance sheet at 31 December 2022.
(2) Included NIC29 effect due to hyperinflation in Turkey (EUR 0,1 million)

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Statements of Cash Flows for 2022 and 2021 (Thousands of Euros)
Note
A. Cash flows from operating activities
A-1 Underwriting activities
1.- Premiums received from direct insurance, coinsurance and accepted reinsurance
2.- Payments of claims for direct insurance, coinsurance and accepted reinsurance
3.- Cash received from ceded reinsurance
4.- Payments for ceded reinsurance
5. - Recovery of claims
6.- Remuneration paid to brokers
7.- Other cash received from operating activities
8.- Other cash paid in operating activities
9. Total cash inflows from underwriting activities (1+3+5+7 = I)
10. Total cash outflows in underwriting activities (2+4+6+8 = II)
A-2 Other operating activities
3.- Cash received from other activities
5.- Total cash inflows from other operating activities (1+3) = III
6.- Total cash outflows in other operating activities (2+4) = IV
7.- Cash received/(paid) for Corporate Income Tax (V)A-3 Total net cash flows from operating activities (I-II+III-IV+V)

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
6
6
0
0
0
0
0
0
0
0
0
0
0
0
0

B. Cash flows from investing activities
B-1 Cash inflows from investing activities
1.- Property, plant and equipment
2.- Investment property
4.- Financial instruments
6.- Interest received
7.- Dividends received
6. Total cash inflows from investing activities (1+2+3+4+5 = VI)
B-2 Cash paid in investing activities
1.- Property, plant and equipment
3.- Intangible assets
4.- Financial instruments
5. Total cash outflows in investment activities (1+2+3+4 = VII)
B-3 Total cash flows from investing activities (VI + VII)
C. Cash flows from financing activities
C-1 Cash received from financing activities (VIII)
5.- Other cash inflows from con financing activities
C-2 Cash paid in financing activities
1.- Dividends to shareholders
2.- Interest paid
C-3 Total net cash flows from financing activities (VIII+IX)
Total increases/decreases in cash and cash equivalents (A-3 + B-3 + C-3)
Cash and cash equivalents at start of year
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of year
Components of cash and cash equivalents at end of year
1.- Cash on hand and at bank
2.- Other financial assets
Total cash and cash equivalents at end of year

17.8
0
17.4
0
0
0
0
8
0
8
0
0
0
0

2022

2021 (1)1,823,469(574,257)
573,258(1,014,259)
167,658(200,711)
50,314(440,501)
2,614,699(2,229,728)

1,599,764(472,237)
651,416(1,064,900)
195,060(171,780)
46,143(355,206)
2,492,383(2,064,123)

10,537
10,537(110,530)
284,978

6,778
6,778
(50,240)
384,798

60
1,162
684,749
19,301
8,740
714,01252
657
473,378
14,27028,581
516,938(5,892)(23,263)(925,514)(954,669)(240,657)(14,635)(30,653)(783,944)(829,232)(312,294)(2,600)(2,600)(2,600)(2,600)58,83960,00060,000(1,161)(1,161)
58,83941,722
347,323
10,637
399,682

131,343
208,370
7,610
347,323

260,499
139,183
399,682345,682
1,641
347,323(1) Presented solely and exclusively for purposes of comparison. Notes 1 to 20 and the Annex to these Financial Statements form an integral part of the balance sheet at 31 December 2022.

All amounts are in millions of Euros, unless otherwise stated

Atradius Crédito y Caución S.A. de
Seguros y Reaseguros
Notes to the Financial Statements for the year ended 31 December2022

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Notes 2022
Content

1

Description of the Company .............................................................................................................................................................. 14

2

Basis of presentation of the financial statements ....................................................................................................................... 18

3

Allocation of results .............................................................................................................................................................................21

4

Recognition and measurement standards .....................................................................................................................................21

5

Intangible assets .................................................................................................................................................................................. 37

6

Property, plant and equipment and investment property ........................................................................................................40

7

Leases ...................................................................................................................................................................................................... 42

8

Financial assets, cash and cash equivalents................................................................................................................................. 43

9Investments in Group companies, jointly controlled entities and associates ...................................................................... 49

10 Receivables on insurance and reinsurance operations and other receivables ....................................................................51
11 Debts and payables .............................................................................................................................................................................. 52
12 Tax matters............................................................................................................................................................................................ 54
13 Income and expenses.......................................................................................................................................................................... 58
14 Provisions and contingencies ........................................................................................................................................................... 59
15 Segment Reporting .............................................................................................................................................................................. 66
16 Technical information ........................................................................................................................................................................ 68
17 Capital and reserves and equity ....................................................................................................................................................... 73
18 Transactions and balances with related parties .......................................................................................................................... 74
19 Other information ............................................................................................................................................................................... 78
20 Subsequent events .............................................................................................................................................................................. 79
ANNEX. BREAKDOWN OF REAL ESTATE PROPERTIES AT 31 DECEMBER 2022 .....................................................................80
Managment report of the Company ....................................................................................................................................................... 93

All amounts are in millions of Euros, unless otherwise stated

Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Notes to the Financial Statements for the year ended 31 December 2022
Translation of a report originally issued in Spanish. In the event of a discrepancy, the Spanish-language version prevails.

1

Description of the Company

a. Incorporation, duration and registered office
Atradius Crédito y Caución S.A. de Seguros y Reaseguros (‘ACyC’ or the ‘Company’) was incorporated in Madrid on 6 July
1929 for an unlimited duration. The registered office is located in Madrid, at Paseo de la Castellana, no. 4.
b. Registered corporate object, regulatory framework and lines of insurance in which the Company operates
ACyC's corporate object consists of the following businesses:--

In the insurance field:
Commercial risks arising from credit transactions in domestic trade;
Commercial risks arising in all types of foreign trade;
Any other types of credit insurance allowed under the applicable legal provisions and the pursuit of which
has been agreed;
Surety bonds and guarantees;
Reinsurance of the above operations.

At 31 December 2022, the applicable legal framework is set out in Spanish Law 20/2015 of 14 July 2015 on Regulation,
Supervision and Capital Adequacy of Insurers and Reinsurers and in Royal Decree 1060/2015 of 20 November 2015.
The Company is registered in the Commercial Registry of Madrid in volume 10836 of section 8, on folio 1, page M-171,144,
entry 308, and with Legal Entity Identification Code no. 9598002U9BK2VP1RTG14 issued by that Registry; it is likewise
registered in the Administrative Register of Insurers of the Spanish Directorate General of Insurance and Pension Funds(Dirección General de Seguros y Fondos de Pensiones; hereinafter 'DGSFP') under reference C-0046, and is authorised
to operate in the following lines of insurance: Credit (commercial risks in domestic and foreign markets) and Bonding.
c. Information on the GroupThe main shareholder of ACyC is Atradius Insurance Holding N.V., a company incorporated and domiciled in
Amsterdam, the Netherlands. The parent company of Atradius Insurance Holding N.V. is Atradius N.V. (together with its
subsidiaries, hereinafter referred to as “Atradius” or the “Atradius Group”), incorporated and domiciled in Amsterdam,
the Netherlands, which also holds one share in the Company. The ultimate parent and controlling party of Atradius is
Grupo Catalana Occidente, S.A., a company incorporated and domiciled in Madrid, Spain.
At year-end 2022, the shareholder structure had not changed. The shareholder of reference of Grupo Catalana Occidente,
S.A. is INOC, S.A., which controls approximately 61.94% of the share capital.
Grupo Catalana Occidente, S.A., through the company Sociedad Gestión Catalana Occidente S.A., holds 1,977,283 shareswith an aggregate acquisition cost of 22.38 million euros, representing 1.65% of the share capital. Those linked to thecouncil represent a 2.86%. The Group's free float is 33.54%, half of which is held by institutional investors. The Group has
no information as to the existence of agreements among its shareholders for concerted exercise of voting rights orplacing restrictions on the transfer of their shares. The institutional investors are distributed geographically as follows:
Spain (45.0%)
USA (25.6%)
United Kingdom (14.1%)
Norway (1.6%)
Switzerland (3.2%)
Rest of Europe (7.5%)
Rest of the world (3.0%)
14

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

The Company is a group parent company and under the current legal framework is exempted from presenting
consolidated financial statements, given that the group is consolidated with a larger group headed by Grupo Catalana
Occidente, S.A. that is governed by Spanish company law and has its registered office at Paseo de la Castellana, 4(Madrid). The 2022 consolidated financial statements of Grupo Catalana Occidente, S.A. were authorised by the Directorsof Grupo Catalana Occidente, S.A. at the Board of Directors meeting held on 23 February 2023 and will be deposited with
the Commercial Registry of Madrid.
Grupo Catalana Occidente, S.A. has the obligation to file consolidated information with the DGSFP.
d. Internal structure
The ACyC organisation is based on centralisation of functions and decentralisation of operations.
In Spain, the regional network is composed of five commercial areas that comprise 20 branches. It has been operatingin Portugal since March 1998, with offices in Lisbon and Oporto.
Grupo Catalana Occidente, S.A.
Spain

Grupo Compañía Española de Crédito y Caución S.L.
Spain

Atradius N.V.
The Netherlands

Atradius Insurance Holding N.V.
The Netherlands
Atradius Crédito y Caución S.A. de Seguros y
Reaseguros
Spain

Atradius Crédito y Caución Seguradora S.A.
BrazilBranches:
Australia
Austria
Belgium
Bulgaria
CanadaCzech Rep
Denmark
FinlandFranceGermany
GreeceHong Kong
Hungary
Ireland
Italy

Japan
Luxembourg
The Netherlands
New Zealand
NorwayPolandPortugal
Romania
Singapore
Slovakia
SwedenSwitzerland
TurkeyUnited Kingdom

Iberinform internacional S.A.U.
Spain
Branch; Portugal

e. Insurance products, their characteristics, sensitivity to insurance risk, risk mitigation and controls:
ACyC works with two main direct insurance products: credit insurance and bonding. Credit insurance can be divided
into three subcategories: traditional credit insurance, instalment credit protection and special products. Each of thesecategories has particular risk characteristics.
The starting point for the management of insurance risk is that all staff have well-defined capacities specifying the levelof risk they can accept and that all risk acceptance must take place within the framework of the risk governancestructure described in Note 16.2. Furthermore, ACyC's reinsurance structure imposes checks on the largest exposures.
Exposures beyond a certain threshold are subject to special acceptance by our leading reinsurers.

15

All amounts are in millions of Euros, unless otherwise stated

Traditional credit insurance and special products
In traditional credit insurance, ACyC insures its customers against the risk of non-payment of trade receivables. The
causes of loss covered differ by policy and usually include all forms of legal insolvency. Policies can also cover so-called‘political’ causes of loss, which include but are not limited to the risk of non-payment due to payment transfer problems,
cancellation of export/import licenses and contract frustration. Traditional credit insurance does not cover nonpayment of trade receivables due to commercial disputes. Each policy stipulates a maximum credit period that thepolicyholder can offer to their debtors without prior approval from ACyC. ‘Debtors’ are the customers of the ACyC’s
insured customers, i.e., the parties on whom ACyC insures credit risk. In order to mitigate the risk of adverse selection,
the traditional credit insurance products of ACyC usually cover only the entire portfolio of debtors of a policyholder. In
addition, policies contain modules that exclude cover for transactions involving sanctioned entities.
For traditional credit insurance, there are two underwriting processes: policy underwriting and risk underwriting.
Policy underwriting is the process by which ACyC decides which companies to accept as policyholders and the coverageterms and conditions offered. Risk underwriting is the process by which ACyC sets risk limits for each buyer and issues
credit limits, thus allowing the risk of existing policies to be managed. Policy underwriting takes place in theCommercial Units and risk underwriting in the Risk Services.
Policies are issued for a fixed period: usually between one and three years. Normally, customers retain some of the risk
for their own account to protect ACyC from the risk of moral hazard. That self-retention can take the form, for example,of an uninsured percentage, a deductible on each claim, an aggregate first loss amount or a combination of these. Almost
all policies stipulate the maximum liability borne by ACyC. A customer is covered for the credit risk on a buyer once acredit limit has been established for the debtor. Many policies allow customers to establish credit limits themselves forsmaller amounts, under conditions specified in the policy. For larger amounts, ACyC must establish the limits for eachdebtor. Credit limits are an important risk management instrument for ACyC as they cap the amount that ACyC would
have to pay out to a customer in the event of a claim. Moreover, ACyC can, in principle, withdraw the credit limit on abuyer at any time if circumstances so require. Credit limits may be subject to specific conditions and ACyC can also set
conditions for cover on a country or withdraw cover on a country altogether. These are important tools in managing
risk exposure.
Staff in Commercial Units have well-defined capacities specifying who can underwrite which policies. The approval of
two people is usually required, and conditions become stricter as the policy coverage grows larger, with the biggest
contracts needing sign-off by both the Director of a Commercial Unit and the responsible Executive Committee member.
The pricing of credit insurance policies, whether renewed or amended, is also subject to governance systems and themethodologies used to establish a benchmark price require the approval of the Quantitative Model Committee, acommittee specifically tasked with approving the quantitative models used in ACyC.
Staff in Risk Services have well-defined capacities specifying who can set the credit limit approval levels. As credit
amounts grow, decisions require approval from at least one supervisor with a higher authority level. Largest credit
amounts require approval by a committee with the appropriate authority level and, in special cases, by a reinsurance
panel.
The special products business offers a range of tailor-made policies to insure against a number of credit and politicalrisks; this type of product includes policies that cover single transactions, single trade relationships and asset
confiscation. A distinguishing feature of the special products policies is that, unlike traditional credit insurance, credit
limits can usually not be easily withdrawn. The conditions of the special products policies demand greater supervisionand due diligence vis-à-vis the insured.
All policies come under a framework of clearly defined authorities issued for underwriters who ultimately report to theMarkets Director. Policyholders’ risk is approved by a dedicated Risk Service that ultimately reports to the Risk Director.
In addition, a risk management team with a functional reporting line to the Group Risk Management unit ensures
adherence to the risk governance model, monitors the portfolio risk and ensures compliance with the terms of thereinsurance treaty.
Bonding
ACyC issues surety bonds for customers in a number of European countries, including Italy, France, Spain, Portugal,
Germany, the Nordic and Benelux countries. Surety bonds insure beneficiaries against the risk of our customer not
meeting contractual, legal, or tax obligations. Beneficiaries include national, regional and local governments as well as
tax authorities and businesses.

16Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Just as there exists the risk that our customer may fail to meet its obligations, whether because it is unable to performthe agreed services or at the required level or because it is insolvent, there is also the risk of the customer intentionallynot performing its obligations. Therefore, our assessment of both the customer’s financial strength and its ability toperform plays an important part in the underwriting process. Unlike traditional credit insurance, exposure related toissued bonds cannot be unilaterally cancelled by ACyC.
When a beneficiary reports a claim, ACyC mediates to resolve conflicts by working with both customer and beneficiary.
If, as a result of non-performance a payment is made by ACyC to the beneficiary, a recovery action is taken against thecustomer, who remains ultimately liable. Whenever ACyC incurs an irrecoverable loss, it is almost always because of
the customer’s financial distress, making the triggers for loss similar to those of traditional credit insurance.
The distribution of customers across different sectors of the economy varies by country as a result of different legal andmarket environments. The type of bonds issued include bid bonds, performance bonds, maintenance bonds, advancepayment bonds and various types of administrative bonds. These bonds are issued with terms ranging from a few weeks
to years, but only rarely do they run beyond five years.
All surety bonds and individual bonds are underwritten by technical underwriters who are part of the Commercial Units.
Technical underwriters assess the risk of non-performance, as well as the terms of the bonding facilities and othertechnical aspects. Financial underwriters, who are not part of the Commercial Units, focus on aspects relating tocustomer risks and must approve the acceptance of facilities and individual bonds with respect to certain thresholds.
There is an authority structure in which decisions are escalated depending on the amounts analysed. The largest
amounts require the approval of a committee with the appropriate authority level.
Instalment Credit Protection (ICP)The ICP product line covers the medium- and long-term risks that financial and corporate policyholders face in theirmultiple instalment agreements with private individuals and businesses, and is available in Belgium and Luxembourg.
Policy underwriting is performed within the Commercial ICP Units. Policies are generally issued for a fixed period with
automatic renewal. The indemnification rate can rise to 100% and recoveries are for the benefit of ACyC.
Risk underwriting is performed by the risk underwriting teams. Authorities are granted to underwriters in accordancewith their seniority and expertise. Cases are escalated in accordance with pre-determined thresholds to the local ICP
credit committees, then to the ICP credit committee and finally to the Executive Committee member responsible for ICP.
f. Distribution Systems
With the main goal of providing a high-quality service to its customers, manifest in highly personalised bespoke
advising using advanced technological resources, ACyC distributes its products through a regional network in Spain andbranches in different locations around the world.
g. Subsidiaries
The ACyC subsidiary companies are (see Note 9):
Subsidiaries

Registered Corporate Objects

Iberinform Internacional, S.A.U.
B2B Safe, S.A.

Information services
Advisory services

Iberinmobiliaria, S.A.U.

Real estate

Crédito y Caución de Brasil Gestao de Riscos de Crédito e Management company
Servicos LTDA (Brasil)
Atradius Crédito y Caución Seguradora S.A. (Brasil)

17

Domestic and foreign credit insurance company

All amounts are in millions of Euros, unless otherwise stated2

Basis of presentation of the financial statements

2.1

Financial reporting regulatory framework that applies to the Company

The regulatory framework governing the Company's financial reporting is set out in:
a)
b)
c)
d)

e)
f)

The Spanish Commercial Code (Código de Comercio) and related company legislation;
The Accounting Plan for Insurers approved by Royal Decree 1317/2008, as amended;
The mandatory standards approved by the Institute of Accounting and Auditing (Instituto de Contabilidad y
Auditoría de Cuentas — ICAC) implementing the General Accounting Plan and its complementary rules;
Royal Decree 1060/2015 of 20 November 2015 on Regulation, Supervision and Capital Adequacy of Insurers andReinsurers (“ROSSEAR”). The purpose of the ROSSEAR is to implement the regulation of private insurance andreinsurance activities set out in Law 20/2015 of 14 July 2015 on Regulation, Supervision and Capital Adequacy of
Insurers and Reinsurers, as well as to complete the transposition into Spanish law of Directive 2009/138/EC of theEuropean Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of
Insurance and Reinsurance (Solvency II Directive);
Spanish Law 20/2015 of 14 July 2015 on Regulation, Supervision and Capital Adequacy of Insurers and Reinsurers(“LOSSEAR”);
All other applicable Spanish accounting rules.

For business operations located outside Spain and Portugal, adjustments have been made to the Accounting Plan for
Insurers (Plan Contable de Entidades Aseguradoras — PCEA) for the sake of uniform accounting treatment where those
operations differ significantly from the accounting standards that apply in Spain.

2.2

Fair presentation

The 2022 financial statements have been obtained from the accounting records of the Company and are presented inaccordance with the applicable financial reporting regulatory framework (see Note 2.1) and, in particular, with theaccounting principles and policies contained thereof to give a true and fair view of the net assets and financial positionof the Company at 31 December 2022, as well as of the results of its operations, of the changes in equity and of the cash
flows during said financial year.
These financial statements, which were approved by the Directors of the Company at the Board Meeting held on 1 March
2023, will be submitted for approval by the Company’s shareholders in General Meeting and are expected to be approved
without any modifications. The financial statements for 2021, were approved by the Directors of the Company on 2
March 2022 and by the Company’s shareholders at the General Shareholders’ Meeting of 23 March 2022.

2.3

Critical issues regarding valuation and estimation of uncertainty

The information contained in these financial statements is the responsibility of the Directors of the Company, who have
had to make estimates to measure some of the assets, liabilities, revenues, expenses and commitments recorded herein.
Basically, those estimates primarily refer to:-

Impairment losses on certain assets (see notes 4.1, 4.2 y 4.5);
The assumptions made for the actuarial calculation of defined-benefit pension liabilities and other commitments
to personnel (see Note 4.11);
Determining the value of the technical provisions (see Note 4.8);
Estimates for calculating premiums accrued and not issued (see Note 4.13);
Estimates for recovery of claims (see Note 4.5.1);

These estimates were made on the basis of the information available at year-end 2022 on the situations analysed.
However, these estimates may have to be modified (upward or downward) in the coming years as a consequence ofsubsequent events. Such modifications would be made prospectively and recognising the effects of the changed
estimates in the profit and loss statement for the years affected.
As a result of COVID-19, of the Russian invasion of Ukraine and of the energy crisis, the state of the economy in the near
future is significantly more uncertain than usual. This, in turn, impacts uncertainty related to the frequency and severityof claims.

18

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Concerning COVID-19, some countries (e.g. China) are still experiencing lockdowns and/or an increase in infection rates.
Moreover, in most European countries (core of Atradius credit insurance business) the governmental support to theeconomy is being progressively rolled back. However, there is still uncertainty as to the extent to which the economy
relied on such support.
The energy crisis and the Russian invasion of Ukraine have had relevant adverse impacts across the global economy,notably on inflation and interest rates. Most trade sectors are dependent on energy, which has suffered material inflation
during 2022. Therefore, the world-trade is being affected by such inflation and stress. This in turn impacts uncertainty
related to the frequency and severity of claims.
As a collateral effect of the above mentioned, most relevant central banks have increased the interest rates. This has
been followed by banks and suppliers of credit, leading to tougher lending conditions, thus adding to the uncertainty infrequency and severity of claims, and affecting, in particular, recoveries.
All the factors above lead to an increased potential for adverse development on the technical provisions in the coming
months because of increase in frequency, severity and insolvency rates.
The bonding business usually only incurs irrecoverable losses when, after a bond call, any payments to beneficiaries
recourse to the bonding customer or its guarantors fails. This is typically due to either the insolvency or bankruptcy ofthe bonding customer. Thus, in the end, the frequency and severity of claims is affected by similar factors as thoseaffecting credit insurance.
All forms of credit insurance and bonding bear the risk that changes in legislation, in particular of insolvency law, may
affect the amount and timing of claims payments or recoveries.
Atradius’ business processes are designed to effectively manage the impact of the many risk factors that affect thefrequency and severity of claims. The business processes continually evolve in response to how Atradius views theserisk factors in the context of its overall business strategy.

2.4Grouping of items

Certain items in the balance sheet, profit and loss statement, statement of changes in equity and statement of cash flows
are presented grouped together for easier understanding, although a breakdown of material items is given in therelevant Notes to the financial statements.

2.5

Allocation of expenses

Expenses are initially booked according to their nature and, subsequently, in those cases where the classification of
expenses by use differs from their classification by nature, reclassified to expense accounts by use.
The policy applied by the Company to reclassify expenses by nature to expenses by use is described below:--

Expenses attributable to benefits mainly include the cost of both internal and external staff that manage claims andthe cost of supplies and maintenance services for the material resources used in that activity;
Acquisition costs mainly include the fees of brokers directly involved in the acquisition of insurance contracts andother related expenses;
Administration expenses mainly include the cost of both internal and external staff engaged in services relating tothis activity, such as the expenses of studies and re-studies borne by the Company in analysing the insured risks;
Expenses attributable to investments mainly include both internal and external investment management
expenses, comprising, in the latter case, the professional fees, commissions and brokerage charges accrued, the costof staff engaged in those functions and the amortisation and depreciation charges (without including goodwill);
Other technical expenses are those that cannot be allocated to one of the above uses per the established criteria.

In addition, with respect to the allocation by insurance line, separate accounting control and management is maintainedfor each line in which ACyC operates and for the different types, with the applicable revenues and expenses being
allocated in line with the volume of premiums and nature of their operations.
There are allocated to the non-technical income statement for the year the losses or profits obtained on the sale oramortisation of financial investments in the asset base, as well as changes in the measurement of investments at fairvalue through profit or loss for said assets.

19All amounts are in millions of Euros, unless otherwise stated

Dividends from financial assets accrued after the date of acquisition will be recognised as income in the profit and loss
statement.

2.6

Comparative Information

The information contained in the accompanying financial statements for 2021 is presented solely and exclusively for
purposes of comparison with the information for 2022.
All amounts presented in these financial statements are presented in thousands of euros (EUR), rounded to the closest
thousand, unless otherwise specified. Such differences as may be observed in some cases between the sums of the
figures recorded in the balance sheet, the profit and loss statement, the statement of changes in equity, the statement ofcash flows and the explanatory Notes are due to rounding.

20

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

3

Allocation of results

The proposed allocation of the net results for the financial year 2022 adopted by the Directors of the Company and to besubmitted for approval by the shareholders of the Company in General Meeting is the following:
Basis of distribution
Profit/(Loss) for the year

216,422

Total

216,422

Allocation
Interim allocation to the equalization reserve

169,958

To voluntary reserves

46,464

Total

216,422

According to the ROSSP, the equalization reserve will be increased every year against the allocation of profit for the year
(see Note 17.6).
At the proposal of the Board of Directors, the General Meeting of the Company's shareholders will resolve to allocate theresults of each year after the interim allocation to the equalization reserve as follows:-

10% will be allocated to the legal reserve until it reaches at least 20% of the share capital. Given that this reserve has
been fully covered, no further allocations were needed at year-end 2022 and 2021;
The amount needed to pay the dividend deemed appropriate by the General Meeting, which will be distributed inproportion to the capital paid in. At 31 December 2022 and 2021, there was no capital pending disbursement;
Any remaining sum will be allocated, by decision of the Shareholders in General Meeting, to setting up special
reserves, to increasing those already created, to extraordinary writeoffs, or will be carried forward in the part notearmarked for any other special use to the following year.

4

Recognition and measurement standards

The main recognition and measurement standards used by the Company to prepare the financial statements for theyear ended 31 December 2022 in accordance with the Accounting Plan for Insurers (“PCEA”) were as follows:

4.1

Intangible fixed assets

4.1.1

Goodwill

Goodwill is the excess, at the acquisition date, of the cost of the business combination over the fair value of theidentifiable net assets acquired in the transaction. Consequently, goodwill is only recognised when assets are acquiredfor valuable consideration and relates to the future economic benefits from assets that could not be individually
identified and recognised separately.
Goodwill is allocated to each of the cash generating units that are expected to benefit from the synergies of the businesscombination. After its initial recognition, goodwill is carried at the acquisition price less the accumulated amortisation
and, if applicable, the cumulative amount of valuation adjustments recognised for impairment. According to theapplicable standards and rules, the useful life of goodwill is set at 10 years and it is amortised on a straight-line basis.
Furthermore, those cash generating units will be analysed at least annually for signs of impairment and, if such signs
exist, impairment testing will be conducted using the methodology indicated further below and, if applicable, avaluation adjustment will be made. The impairment testing has been conducted taking into account the current
macroeconomic conditions, which are being impacted by the COVID-19 pandemic.
Impairment adjustments recognised against goodwill are not reversible in later financial periods.

4.1.2

21

Computer applications

All amounts are in millions of Euros, unless otherwise statedAcquired computer software licences are capitalised on the basis of costs incurred to acquire and to bring to use thespecific software. These assets are amortised on the basis of the expected useful life: which is between three and five
years. Computer software is stated at cost less accumulated amortisation and any accumulated impairment losses.
Development costs that are directly associated with the production of identifiable and unique software products
controlled by Atradius, and that will probably generate economic benefits exceeding costs beyond one year, arerecognised as intangible assets. Direct costs include the software development team’s employee costs and an
appropriate portion of relevant overhead. The research costs associated with developing identifiable and unique
software products as well as the costs of maintaining computer software programmes are recognised as an expense as
incurred. The computer software development costs recognised as assets are amortised using the straight-line
amortisation method over its estimated economic useful lives: in general, not exceeding a period of five years. Majorityof capitalised software developed for strategic business developments has a useful life of 10 years.
Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic
benefits embedded in the specific assets to which it relates. All other expenditure is expensed as incurred.

4.1.3

Other fixed assets

Other intangible assets are recorded at their fair value as at the date of acquisition. Their amortisation is calculated on astraight-line basis during the expected useful life of the assets, which is estimated at between 5 and 10 years.

4.2

Property, plant and equipment and investment property

Property, plant and equipment and investment property are initially recorded at their acquisition price or cost of
production, revised, where applicable, as provided in Royal Decree Law 7/1996 of 7 June 1996 and in Royal Decree
2607/1996 of 20 December 1996 (for property located in Spain), less their accumulated depreciation and such
impairment losses as may exist according to the policy mentioned at the end of this Note.
All land, natural assets and buildings held to obtain income, capital gains or both are considered investment property.
The land, natural assets and buildings held to provide services or for administrative purposes are considered property,
plant and equipment.
Expenses associated with the repair and maintenance of property, plant and equipment and investment properties arecharged to the profit and loss statement for the year in which they are incurred. Conversely, sums invested in
improvements that contribute to increasing the capacity or efficiency or to lengthening the useful life of those assets arerecorded as a higher cost of those assets.
The Company depreciates its property, plant and equipment and investment properties on a straight-line basis, applying
yearly depreciation percentages calculated as a function of the years of estimated useful life of the respective assets, as
indicated below:
Asset Category

Depreciation
Percentage

Buildings

2%

Furniture

10%-33%

Plant

10%-33%

Data processing equipment

20%-33%

Other property, plant and equipment

12%-15%22

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

4.2.1

Impairment of intangible assets, property, plant and equipment and investment property

At the end of each year, the Company conducts an impairment test for the existence of impairment that reduces therecoverable value of these assets to below their carrying amount. Impairment of intangible assets and of property, plantand equipment and investment property is calculated, in general terms, separately asset by asset. If the recoverable
value of each individual asset or right cannot be calculated, the Company determines the recoverable value of the cash
generating unit to which each fixed asset belongs.
In its impairment testing of assets, the Company considers at least the following factors:-

Evidence from internal reports indicating that the economic return on the assets is, or will be, worse than expected.
Evidence of obsolescence or physical deterioration of an asset.

The recoverable amount is the higher of the asset's fair value less costs to sell and its value in use, with the latter
understood to mean the present value of the expected future cash flows.
In the case of real estate, fair value is the appraised value determined by appraisal companies authorised to appraise
properties. Those appraisals are updated at least biannually. Where the fair value of the property, thus determined, isless than its net carrying value, the loss of value is accounted for by setting aside the relevant provision for impairmentwith a charge to profit and loss statement.
The individualised valuation adjustments of the above assets, and their reversal when the circumstances that led to theadjustments disappear, are taken to the profit and loss statement as an expense or income, respectively. Reversals arelimited to the carrying value at which the fixed asset or the investment property would have been recognised at thereversal date had no loss of value been recorded.

4.3

Operating leases

Leases are classified as finance leases when their conditions imply substantial transfer to the lessee of the risks andrewards incidental to ownership of the leased asset. Operating leases are those in which the conditions do not imply
substantial transfer to the lessee of the risks and rewards incidental to ownership of the leased asset.
Revenues and costs arising from operating lease agreements are taken to the profit and loss statement in the year they
are accrued. Any payment that may be received or made when contracting an operating lease will be treated as aprepayment and taken to profit and loss statement over the term of the lease, as the rewards of the leased asset aretransferred or received.
In the case of finance leases, the cost of acquiring the leased asset is presented on the balance sheet according to its
nature, increased by the amount of the directly attributable contracts costs, which are recognised as an expense over
the term of the contract, applying the same criterion as used for recognising lease revenues.

4.4

Fair value

For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree towhich the inputs to the fair value measurements are observable and the significance of the inputs to the fair value
measurement in its entirety, which are described as follows:
Level 1: Quoted prices in active markets. This category includes financial instruments for which the fair value isdetermined directly by reference to published quotes in an active market. A financial instrument is regarded as quoted
in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group,
pricing service or regulatory agency and those prices represent actual and regularly occurring market transactions
conducted on an arm’s length basis.
Level 2: Valuation techniques based on observable market data. This category includes financial instruments for which
the fair value is determined using a valuation technique (a valuation model), where inputs in the valuation model aretaken from an active market or are market observable. If certain inputs in the model are not market observable, but all
significant inputs are, the instrument is still classified in this category, provided that the impact of those elements on
the overall valuation is insignificant. Included in this category are items whose value is derived from quoted prices ofsimilar instruments, but for which the prices are (more than insignificantly) modified based on other observable
external data.
23

All amounts are in millions of Euros, unless otherwise stated

Level 3: Valuation techniques incorporating information other than observable market data. This category includes
financial investments for which the fair value is determined using a valuation technique for which a significant level ofthe input is not supported by current observable market transactions. This category also includes the financial
investments for which the fair value is based on brokers’ quotes or pricing services. These valuations are for 100% of
the fair value verified by an external independent valuation company.
The fair values of financial instruments traded in active markets are based on quoted market prices at the end of thereporting period. The quoted market price used for financial investments held by ACyC is the current ask price.
Transaction costs on initial recognition of financial investments are expensed as incurred.
The fair value of financial instruments not traded in an active market is determined using valuation techniques. ACyC
uses its judgment to select a variety of methods and make assumptions that are mainly based on market conditions
existing at the end of each reporting period.
The fair value of own-use property and of investment property is determined by independent real estate appraisers
registered in the relevant countries and with the appropriate qualifications and experience in property valuations.

4.5

Financial instruments

4.5.1

Financial assets

Classification
The financial assets held by the Company have been classified, as at 31 December 2022, into the following categories:--

Loans and receivables: financial assets originating in insurance and reinsurance operations, or those which, nothaving a commercial origin, are not equity instruments or derivatives, with receipts of fixed or determinableamounts and not traded on an active market. This excludes debt securities and swaps of certain or predeterminedcash flows that the Company allocates, at the time of initial recognition, to "Available-for-sale financial assets".
Holdings in Group companies and associates: Group companies are those with which the Company has a controlling
relationship, while associated companies are those in which the Company exercises significant influence.
Available-for-sale financial assets: this includes debt securities and equity instruments of other companies thathave not been classified in any of the above categories.

Initial measurement
The Company recognises financial assets on its balance sheet when it becomes a party to the associated contract or legal
arrangement according to its terms.
Recoveries of claims are only recognised when they are sufficiently certain at the date on which the financial statements
are issued and, therefore, expected to give rise to economic benefits. As regards Spain and Portugal, for recoveries
specific to the credit insurance line, in accordance with article 43 of the Regulations on the Organisation and Supervisionof Private Insurance (Reglamento de Ordenación y Supervisión de los Seguros Privados) and Finance Ministry Order
EHA/339/2007 of 16 February 2007 implementing certain specific provisions of private insurance, the Company
capitalises the recoveries, using statistical methods, with the execution of certain requirements and submitting the
calculations to periodic assessments by independent experts. In this case, the Company calculates the amount of theestimated recoveries using a statistical method specifically developed for this purpose, which studies the historicalevolution of the settlements of all declared losses, including completed claims, and allows their future behaviour to bepredicted, in order to apply them to the actual situation and make reasonable estimates of the recoveries to be obtainedwith those projections. For the other branches, the estimated recovery is implicit in the calculation of the technicalprovisions (see Note 4.8).
The amount of the estimated recoveries of the business in Spain and Portugal, net of the reinsurance share, is recorded
under “Loans and receivables – Other receivables – Rest of receivables” on the accompanying balance sheets (see Note
10).

24

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Purchases and sales of financial assets structured in conventional contracts are recognised on the trade or settlement
date. Contracts that can be settled for cash differences are recorded as a derivative instrument. In particular, foreign
currency transactions are recorded at the settlement date, and financial assets traded in Spanish secondary securities
markets are recognised on their trade date if they are equity instruments and on their settlement date if they are debt
securities.
Financial assets are initially recorded at the fair value of the consideration received plus any transaction costs that are
directly attributable at the acquisition date.
In the case of equity investments in Group companies that entail control of the subsidiaries, the fees paid to legal
advisors and other professionals in relation to the acquisition of the investment are taken directly to the profit and loss
statement. Investments in Group companies, jointly controlled entities and associates are initially recorded at cost.
Loans and receivables are initially recognised al fair value plus transactions costs.
Subsequent measurement
Financial assets classified as "Loans and receivables" are carried at their amortised cost. The interests accrued arerecorded in the profit and loss statement, applying the effective interest rate method.
In particular, with respect to valuation adjustments of premiums pending collection, the Company makes theappropriate allocation with a charge to the profit and loss statement in accordance with the impairment of thereceivables from policyholders. That impairment is calculated at year-end separately for each line of insurance or risk
using the information available on receipts of premiums pending collection at that date.
The general policy followed by the Company is as follows:--

Premiums of six months or more are provisioned for in full;Premiums of three months or more and less than six months are 50% provisioned for;Premiums of less than three months that have not been claimed in court are provisioned for applying the average
percentage of cancelled premiums that were in that situation in the last three years, making the historical series asuniform as possible. Where the recorded experience is not sufficient, these premiums are provisioned for applying
a percentage of 25%;
Premiums claimed in court are provisioned for separately according to the circumstances of each case.

For the rest of the items classified as loans and receivables, at least at year-end the necessary impairment adjustments
are made if there is objective evidence that not all sums owed will be received.
Available-for-sale financial assets are carried at their fair value. Such variations as may occur in that fair value will berecorded in equity until the asset is disposed of or becomes impaired (on a stable or permanent basis), at which timethose accumulated results will be taken to the profit and loss statement. In this regard, signs of impairment (of apermanent nature) are considered to exist in equity instruments if there is a 40% decline in the trading price of the asset
or if its value enters into a prolonged decline of a year and a half without recovering. In the case of debt instruments
acquired, impairment is deemed to exist if there is a reduction or delay in the estimated future cash flows that may becaused by insolvency of the issuer.
Debt securities and swaps of certain or predetermined cash flows assigned to the "available for sale" category, and all
financial assets that are not carried at their fair value, will be tested for impairment by the Company at least at yearend.
Objective evidence of impairment is considered to exist if the recoverable amount of the financial asset is lower than its
carrying amount. The recoverable value is determined by the present value of the future cash flows that are estimatedwill be generated by the financial assets being measured discounted at the effective interest rate calculated at the timeof their initial recognition.

25

All amounts are in millions of Euros, unless otherwise stated

Investments in Group companies, jointly controlled entities and associates are stated at their cost, minus, as applicable,
the cumulative amount of valuation adjustments for impairment. Those adjustments are calculated as the difference
between the carrying value of those investments and their recoverable amount, the latter being taken as the higher ofthe fair value less costs to sell and the present value of the future cash flows from the investment. Unless there is better
evidence of the recoverable amount, the equity of the investee is considered, adjusted for the unrealised capital gains
existing at the measurement date (including such goodwill as may exist).
The Company derecognises financial assets when they expire or when the rights to the cash flows of the financial asset
are assigned and the risks and rewards incidental to ownership are substantially transferred, such as in outright salesof assets, sales of financial assets with an agreement for repurchase at their fair value and securitisations of financial
assets in which the seller neither retains subordinated financing nor gives any type of guarantee nor assumes any othertype of risk.
Conversely, the Company does not derecognise financial assets, and instead recognises a financial liability equal to theconsideration received, in those assignments of financial assets in which it substantially retains the risks and rewards
incidental to ownership, such as discounted bills, sales of financial assets with an agreement to repurchase at a fixedprice or at the selling price plus interest, and securitisations of financial assets in which the seller retains subordinatedfinancing or some other type of guarantee that substantially absorbs all expected losses.
The impact of foreign currency on available-for-sale financial assets is recorded in the profit and loss statement.

4.5.2

Financial liabilities

The financial instruments issued, incurred or acquired are classified as financial liabilities, in full or in part, when they
imply for the Company a contractual obligation to deliver cash or another financial asset, or to exchange financial assets
or liabilities with third parties on conditions that are potentially unfavourable.
Debts and payables that originate in insurance and reinsurance operations, as well as those which, though not of acommercial origin, cannot be considered as derivative financial instruments, are classified as financial liabilities, forpurpose of their measurement, in the category of debts and payables.
Debts and payables are initially stated at the fair value of the consideration received adjusted for any directly
attributable transaction costs.
They are subsequently stated at their amortised cost. The interest accrued is recorded in the profit and loss statement,
applying the effective interest method. Nevertheless, debts that have been initially measured at their nominal value willcontinue to be carried at that amount.
Trade payables falling due within one year and that do not have a contract interest rate, and capital calls on
shareholdings in third parties that are expected to be paid in the near term, are recorded at their nominal value, whenthe effect of not discounting cash flows to present value is not significant.

26

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

4.6

Transactions in foreign currency

4.6.1

Functional and presentation currency

Items included in the financial statements of the Company are measured using the functional currency of the respective
markets in which it operates. For purposes of its financial reporting, the Company's currency is the euro.

4.6.2

Transactions and accounting balances

At the close of the financial year, monetary assets and liabilities held in foreign currencies are converted to euros at therate of exchange in effect at the balance sheet date. Exchange gains and losses are expensed when they arise.
Non-monetary assets and liabilities that are measured at fair value and denominated in foreign currency are converted
according to the exchange rates prevailing on the date the fair value was determined. The exchange gains and losses
that arise are taken to equity or to profit and loss for the year applying the same policy as for recording variations infair value.

4.6.3

Branches

Where the functional currency of a branch of the Company is a non-euro currency, the differences generated in theconversion of its financial statements to the presentation currency will be recorded directly in equity.
Shown below are the most significant functional currencies for the Company:
Currency

Year end rate

Average rate

At 31 December 2022

GBP
1.127

AUD
0.637

GBP
1.156

AUD
0.648

At 31 December 2021

1.190

0.640

1.174

0.629

Shown below are the assets, earned premiums and the profit before tax of the most significant functional currencies for
the Company:

2022

AssetsEarned premiums

Profit before tax

EUR

2,619,511

1,282,563

188,248

GBP

573,239

156,32133,020AUD

135,274

58,041

13,872Other currencies

1,025,393

383,443

55,319Total

4,353,417

1,880,367

290,460

2021

AssetsEarned premiums

Profit before tax

EUR

2,473,189

1,139,726

134,237

GBP

638,859

137,545

18,029AUD

126,150

49,002

19,259Other currencies
Total

4.7

865,484

316,606

25,557

4,103,682

1,642,879

197,082

Corporate income tax

Corporate income tax cost or income includes both the part relating to the current income tax and the one for deferred
tax.

27

All amounts are in millions of Euros, unless otherwise stated

Current income tax is that paid as a result of tax assessments on the profits for the year. Tax relief and other tax benefits,
excluding withholdings and interim payments on account, and tax loss carryforwards applied in the year, reduce thecurrent income tax liability.
The deferred income tax cost or income reflects the recognition and cancellation of deferred tax assets and liabilities.
These include temporary differences, which are identified as the expected balances payable or recoverable as a resultof differences between the book value and tax value of assets and liabilities, as well as tax losses pending carryforward
and credits for tax deductions not applied. These amounts are recorded applying to the temporary difference or credit
in question the tax rate at which they are expected to be collected or settled.
Deferred tax liabilities are recognised for all taxable temporary differences, except those in which the temporary
difference derives from the initial recognition of goodwill or other assets and liabilities in operations that affect neither
tax income nor accounting income and which are not a business combination.
Deferred tax assets are only recorded when it is considered likely that the Company will have sufficient future taxable
earnings against which they can be applied.
Deferred tax assets and liabilities arising on operations debited or credited directly to equity accounts will also berecognised in a balancing entry under equity.
Deferred tax assets are reviewed at each balance sheet date and the necessary adjustments are made if there is any
doubt concerning their future recoverability. Deferred tax assets not recognised in the balance sheet are also reviewed
at each balance sheet date and are recognised if their recovery against future tax profits becomes probable.
On 23 July 2015, the Board of Directors of the Company resolved that for tax periods beginning as from 2015, theCompany would pay tax in Spain under the tax consolidation system provided for in articles 55 to 75 of Law 27/2014 on
Corporate Income Tax, designating Grupo Catalana Occidente, S.A. as parent company of ACyC.

4.8

Technical provisions y Equalization reserve

As mentioned in Note 2.1, on 1 January 2016 the Royal Decree 1060/2015 of 20 November 2015, which approved theROSSEAR and repealed the previous ROSSP came into force. Nevertheless, as stipulated in Additional Provision Five of
the ROSSEAR, when calculating technical provisions for accounting purposes, articles 29 to 48 bis of the ROSSP will
apply.
Technical provisions record the amounts of obligations undertaken under insurance contracts in force in order toensure, based on prudent and reasonable considerations, the fulfilment of those obligations.

4.8.1

Provision for unearned premiums and ongoing risks

The provision for unearned premiums is made to time allocate the premiums accrued at year-end and includes the partof the premium earmarked for fulfilling future obligations not expired at that date.
Commissions and other acquisition costs in respect of the premiums written are expensed according to the same
criterion as used to recognise revenue from the premiums of insurance contracts in force. The part of commissions andother acquisition costs for the unearned period of insurance policies in force is recorded in “Other assets – Accrual
accounts” under assets on the accompanying balance sheets. At 31 December 2022, the amount of accrued commissions
was EUR 69.6 million (2021: EUR 61.2 million).
The provision for unexpired risks complements the provision for unearned premiums to the extent that the amount of
this provision is not sufficient to reflect the measurement of all risks and expenses to be covered in relation to thecoverage period not closed at year-end. It is calculated as provided in the current ROSSP. At 31 December 2022 and 2021,
the result of the calculation indicated the provision was not required.
In compliance with the resolution issued by the DGSFP in reply to a query submitted by the Company on 18 December
2015, the Company made an adjustment for uniform treatment of the insurance operations originating from the former
Atradius Credit Insurance S.A. (ACI), allocating to the provision for unearned premiums the part of the premium inrespect of outstanding operations that was included as provision for claims incurred but not yet reported in ACI's books.

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Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

4.8.2

Claims provisionThis records the total amount of outstanding obligations in respect of claims incurred prior to the balance sheet date.
The Company calculates this provision as the difference between the estimated or certain total cost of claims not yetreported or pending settlement or payment and aggregate sums already paid in respect of those claims.
Claims not yet settled or paid and claims not yet reported
For claims pending to be settled that were declared at year-end, the amount of this provision is calculated on the basisof an individual analysis of each file, based on the best information available at year-end, using the claim data for
individual cases notified to the AC&C and statistical analysis for claims that have occurred but have not been declared.
This includes external expenses inherent to the claims settlement, interest on late payments and legally establishedpenalties, where applicable. In addition, estimates of expected losses are made based on historical claims experience,
estimates of future payments versus estimates and other known trends and developments.
The risks associated with credit insurance and bonding are subject to a number of influences that are not particularly
open to quantitative sensitivity analysis. This section describes the quantitative sensitivity analysis that is feasible.
Under normal circumstances, the most important assumption used in the main methods for reserving for traditional
credit insurance to set the estimate for the ultimate number of claims for the most recent months of risk would be thatthe claims inflow in early 2023 would be around 20% above the level of end 2022. The main methodologies for
estimating claims provisions for traditional credit insurance combined underpin 65% (2021: 71%) of the claims
provisions for traditional credit insurance.
In light of the increased uncertainty as a result of the current circumstances, we have taken a similar approach for 2022
closing as we did for 2021 closing. During the second half of 2020, the number of reported claims dropped significantly
compared to the first half of the year. This partly relates to a drop of insured business as result of the lock-downs in early2020 and, partially, because of government’s support for the economy. However, whilst the insured shipments haverecovered since, the number of claims registrations remained at a low level including the first two quarters of 2022.
However, the second half of 2022, showed a notable increase. This being said, the total number of claims registrations
during 2022 is still 20 – 40% lower than the claims reported during the first half of 2020, depending on the country. The
2022 provisions have been set based on the assumption that this reduction is still temporary and that a further strong
increase in claims registrations is still expected going forward. The estimated ultimate claim count for most recent
month of risk has been set at the level of the first half of 2020 plus 10 – 40% depending on the country due to uncertainty
in the current economic environment.
An indication of the sensitivity to projected ultimate number of claims would be the following: if the estimated ultimate
number of claims, inclusive of the expected increase mentioned in the previous paragraph, for the most recent six
months of risk were to change by 10%, the claims provisions would change by EUR 37 million, gross of reinsurance(2021: EUR 33 million). As in essence provisions for most recent months are set as estimated number times estimatedclaims size, this also describes the sensitivity to assumed claims size. This sensitivity is approximately linear. Unless
noted otherwise, the same holds true for other sensitivities mentioned in this section.
Under normal circumstances, for modelling attritional losses, the uncertainty in severity quickly becomes lessimportant compared to the uncertainty in frequency, as the portfolio becomes larger. This feature is not specific to credit
insurance, but holds for any insurance product, provided the portfolio is large enough, and correlation between countand severity is small enough. It is our experience that average claim sizes, for the attritional losses, are sufficiently
stable over time to not have significant margins of uncertainty in the parameters governing the size of attritional claims
that have not yet been reported.
Whilst recent trends in severity have been duly considered as part of the process by which Atradius reviews and sets
parameters and prudent choices have been made, we still consider there to be more uncertainty than in recent history,
as result of the unprecedented circumstances.
To indicate an overall level of sensitivity with respect to the parameters driving the average size for claims not yet
registered, if this average would be increase by 10%, claims provisions for attritional losses would increase by EUR 34
million (2021: 32 million).

29

All amounts are in millions of Euros, unless otherwise stated

By its nature, an estimate of the expected inflow of large cases is not easy to quantify. The order of magnitude of thissensitivity would be, in the judgement of management, similar to the sensitivity in the estimated number of claims forthe most recent months, although, as is inevitable with severity risk, it has a longer tail. From historic data it can be seenthat the correlation between the ultimate aggregate losses arising from large claims by underwriting year and theattritional losses is larger than 80%.
As such, supporting the plausibility of the management judgement, provisions for large cases are in part based on
historic experience with large cases and in part on case by case reporting of ultimate loss estimates. The approach that
relies on historic experience sets an ultimate loss arising from large cases as a fraction of the total losses for the last two
risk years. Despite the historically high correlation between large and attritional losses, current low claims entry implies
estimated attritional losses for recent underwriting years to be well below prior years. These exceptional circumstances,accompanied with the current level of uncertainty and experience from prior financial crisis (2008-2009, which showeda higher proportion of large losses over total losses) leads to setting a ratio aligned to the historic one observed in priorfinancial crisis. The selected ratio implies estimated ultimate large loss amounts (as opposed to the ratio with attritional
losses) to be in the range of those observed under normal circumstances, like underwriting years 2012 to 2019. If thesefractions were chosen 10% higher, then the claims provisions for traditional credit insurance would increase by EUR 75
million (2021: 66 million). The case by case estimates are specific to the individual facts and circumstances of the case.
As such, no meaningful overall insight to the sensitivity can be given.
In addition to contributions from standard components of Atradius reserving methodologies, an Event Based Provision
has been estimated, due to the impact of the conflict between Russia and Ukraine. This is for those risks considered to
be not fully covered by the standard methodologies. This is based on a case-by-case review of the exposures related to
the Russia-Ukraine conflict. Management has considered two main drivers of risks to be covered by the Event Based
Provision:a) Real Outstanding Exposure (ROE) related to traditional credit insurance business from customers trading out of
Russia and for Russian/Ukrainian buyers. This excludes exposure already notified as claims, as the standard
methodology already caters for this. It also excludes exposure for which a notification of non-payment was
registered. This is treated as a separate category:b) Notifications of Non-Payments related to business from customers out of Russia but affected by the conflict between
Russia and Ukraine.
As a result of the analysis performed, a EUR 140m provision gross of reinsurance (EUR 98m net of reinsurance) has
been added.
Claims provisions are presented net of recoveries from salvage and subrogation. Realised recoveries can deviate fromexpected recoveries. Expected recoveries amount to EUR 364 million (2021: EUR 361 million). The largest twocomponents of the expected recoveries are the recoveries for traditional credit insurance of EUR 160 million (2021: EUR
137 million) and for instalment credit protection of EUR 132 million (2021: EUR 138 million).
As recovery rates differ by country as well as product, moreover, that the development depends on the age of theunderwriting year, it is challenging to provide insight into sensitivity to assumptions by measuring the impact of a mere
parameter change. For traditional credit insurance, ultimate recoveries are first estimated using commonly usedprojection methods. These estimates are then reduced considering a margin for uncertainty, such that a favourable
development on these estimates is by far the most likely outcome. Nevertheless, the impact of setting the recovery
provisions lower by 10% is EUR 16 million (2021: EUR 14 million). For instalment credit protection, for which similar
margins for uncertainty are introduced, the impact of setting recovery provisions lower by 10% is EUR 13 million (2021:
EUR 13 million).
Sources of uncertainty in the estimation of future claims payments
The sources of uncertainty in the estimation of future claims payments include, but are not limited to, all the factors that
affect the frequency and severity of claims in general, as described in Note 2.3.
The insurance liabilities that cover claims experience after the reporting period for risks that have been accepted before
the end of the reporting period consist of two elements: the provision for unearned premium (UPR) and the provisions
for claims ‘incurred but not reported’, the IBNR. The accounting policies and estimation methods for setting UPR and
IBNR vary by product and in part also by entity within Atradius:

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Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

-

-

-

For traditional credit insurance, premium is earned in full when the underlying shipment takes place. UPR
exclusively relates to the unearned part of premium invoiced in advance and to risks that have not started. IBNR
is Atradius’ estimate for future claims payments that will result from risks taken on, but for which no claims
notification has been received;
For the local credit insurance business in Spain and Portugal, premium is earned pro rata over the period between
invoice date and due date of invoices for the insured shipments. Thus, part of UPR relates to risks that have started,in the sense that the underlying insured shipment has taken place. IBNR is the local business in Spain andPortugal’s estimate for future claims payments that will result from risks taken on, for which no claims notification
has been received and for which the underlying invoices are overdue at the end of the reporting period;
For bonding, instalment credit protection and reinsurance, the UPR relates to risk taken on; andFor special products, UPR is set on the same basis as for traditional credit insurance. With the exception of single
transactions, where the UPR relates to risk taken on.

As a consequence, the release of the provision for unearned premium should be taken into account for the local credit
insurance business in Spain and Portugal, bonding, instalment credit protection and reinsurance to evaluate theaccuracy with which Atradius has historically estimated future claims payments.
Estimates for future claims payments are made through a combination of case-by-case estimates and statisticalestimates. Provisions for reported claims are set on a case-by-case basis, taking into account statistical estimates for
expected recoveries and statistical estimates of claims incurred to payment ratios. The estimates for future claims
payments are produced per period during which policyholders brought risk under the cover of the policy (i.e., the period
in which the insured shipment has taken place). Large cases are provisioned separately, at expected loss.
In the case of traditional credit insurance, the main sources of uncertainty for estimates of future claims payments
include the same as the ones contained in Note 2.3. Estimates for future claims payments for bonding have a greater
uncertainty than estimates for future claims payments for credit insurance. Bonding is a ‘longer tail’ business; i.e., thetime between issuance of the bond and receipt of the bond call tends to be much longer than that of traditional shortterm credit insurance. For example, most credit insurance covers credit periods up to 180 days, while around half thenumber of bonds written has tenors of over two and a half years. After receipt of a bond call, it usually takes longer tosettle the claim and litigation is not uncommon, either following the bond call or when trying to realise recoveries.
Especially in Italy, litigation tends to be a lengthy process. Outcomes of litigation cannot be predicted with certainty. For
bonding, the provisions set on a case-by-case basis are based on the amount called minus an amount to account for
expected recoveries based on historic experience or case specific information. For imminent large bond calls as well as
for large customers in financial difficulties, the Company sets a claim provision. The case by case and business oriented
evaluation is integrated with a statistical and actuarial model. This model based on the exposure of active bonds applies
probability of defaults and loss given default. Booked recovery provisions for bonding are periodically reviewed andadjusted to experience.
Internal claims settlement expenses
The claims provision includes an estimated amount for internal management and claims handling expenses.

4.8.3

Provisions for profit-sharing and return premiums

These provisions include the profits accrued and not yet allocated to policyholders or beneficiaries, as well as theestimated amount of premiums to be returned to policyholders based on the recorded behaviour of the insured risks.
They are calculated according to the relevant clauses of the contracts in force at year-end.
Both in the current year and in the previous year, other technical provisions of the ceded business have been reclassified
to provisions for profit sharing and returns. The amount reclassified in 2022 is EUR 64.1 million (2021: EUR 68 million)

4.8.4

Equalization reserve

Unlike the above reserves, this is a restricted reserve recorded in the Company's equity. It is cumulative and must be set
aside for the credit and bonding insurance lines out of the profits recorded each year (see Note 3).

31All amounts are in millions of Euros, unless otherwise stated

By law, in credit insurance the allocation to this reserve can be no less than 75% of the positive technical result of theinsurance line and must be made until it reaches 134% of the average of the self-retention premiums accrued in the last
five years. In bonding insurance, the minimum allocation is 2% of the commercial premium. The reserve may only be
used to offset deviations in the self-retention claims rate (see Note 17.6). For the bonding line the allocations are madeuntil the reserve stands at 35% of the self-retention risk premiums.

4.8.5

Reinsurance share on technical provisions

These are calculated according to the conditions of the reinsurance contracts in force at year-end. ACyC transfers asignificant portion of its insurance risk to external reinsurers through a number of reinsurance arrangements that
include quota share and excess of loss treaties covering both the entire portfolio of ACyC and the quota sharearrangements relating to specific risks. The reinsurance treaties are usually renewed annually one year in advance,
normally in December of the previous year. During 2022, Atradius decided to renew its reinsurance treaties for 2023.
This trend continued with the renewal of reinsurance treaties for 2024 at the start of 2023. On renewal, Atradiusassesses the optimal structure of the treaties, including the excess of loss, the stop-loss and the optional treaties. A
number of items are taken into consideration during this review, including the growth projected for the underlying
business, the state of the economy, etc. Also, the proposed structure is considered in the context of the Solvency II capitalrequirements and Atradius' risk appetite.
For the 2022 underwriting year, one quota share reinsurance treaty was in place covering the major part of ACyC's
business. The retention under this treaty is 63% (2021: 63%).
It is currently expected that Atradius Reinsurance DAC (ARE) will be merged into ACyC through a cross-border merger
to be completed in 2023. The transaction remains subject to the necessary Board, shareholder, court and regulatory
approvals. Upon effectiveness of the merger, ARE’s assets and liabilities, including all of its reinsurance obligations,would be transferred to ACyC, through its Irish branch, which would conduct ARE’s reinsurance business as its legal
successor, with ARE being dissolved without going into liquidation.
In addition, there are two additional quota share contracts covering a limited number of policies, with a retention
percentage of 25%, and a single excess of loss programme covering the self-retention under that quota share treaty thatconsists of a series of excess of loss treaties (per buyer group).
The attachment point of the excess of loss treaties has been set such that the net retention for business ceded underthese treaty structures for any buyer group does not exceed EUR 26.25 million for ACyC. The top of the excess of loss
layers is chosen so that, in the judgement of management, there remains only a very remote possibility that failure ofany single buyer/buyer group will exceed the top end of the excess of loss coverage.
With regard to the reinsurance panel, it is Atradius’ policy to select only reinsurers that have a high rating. The normal
minimum requirement is an ‘A-’ level rating. The treaties also include a provision that if a reinsurer is downgraded
during the period of the reinsurance below an ‘A-‘ rating that then security can be requested and if not provided thereinsurance agreement with that reinsurer can be terminated.
Government Agreements
In view of the situation generated by the COVID-19 pandemic and, as a support to the national economy, the 10 main
countries where the Group operates have supported the business of credit insurance in the form of specific government
reinsurance schemes with high cession rates.
The government schemes were part of an overall package of measures and aimed to ensure that sufficient liquidity wasavailable in the market, to counteract the damage inflicted on companies affected by the outbreak and to preserve thecontinuity of economic activity during and after the outbreak. In particular, they aimed to ensure that trade credit
insurance services continued to be available to businesses.
In 2020 Atradius entered into agreements with the governments of France, Germany, Denmark, Norway, Belgium,
Luxemburg, the Netherlands, United Kingdom, Italy and Spain. All these agreements were renewed until the firstsemester of 2021, except for France where the covered period was extended to 31 December 2022. In general terms, allgovernment schemes covered Credit Insurance with domestic policyholders related to all the buyers. In Europe, allagreements were approved by their correspondent regulators. These government reinsurance agreements are applied
before the private reinsurance with the exception of Spain where the agreement provided an additional cession to theprivate cession). All government schemes are risk attaching, the cession rates are different per country.
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Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

The table below details the impacts of the agreements in the consolidated statement of financial position (in thousand
euros):(EUR thousands)

Total

Total

Balance Sheet:

2022

2021

Ceded Technical Provision

29,190106,766

Premium provisions ceded

7,533

26,117(384,364)(297,805)

Accounts receivable/payable

12,115(125,754)

Reinsurance commission(2,044)(7,307)

Insurance premiums ceded(14,852)(323,805)

Claims recovered(27,277)(35,527)

2,647(7,307)(39,482)(253,128)

Cash received/paid

Profit and loss Statement:

Reinsurance commission
Result of governmental agreements

4.9

Provisions and contingencies

In preparing the financial statements, the Directors of the Company distinguish between:-

Provisions: credit balances covering current obligations arising as a result of past events the cancellation of which
will probably result in a future outflow of funds but whose amount and/or cancellation date are uncertain;
Contingent liabilities: possible obligations arising as a result of past events, whose materialisation is dependent on
the occurrence, or otherwise, of one or more future events falling outside the Company’s control.

The financial statements present all provisions for which it is more likely than not that the obligation will have to be
met.
The value of these provisions is measured using the best possible estimate of the amount necessary to cancel or transfer
the obligation, taking into consideration the information available on the event and its consequences, recording theadjustments made from updating said provisions as financial costs as they accrue.
Provisions for restructurings, onerous contracts and litigation are recognised when ACyC has a present legal orconstructive obligation as a result of past events and that an adverse result is highly likely to imply a loss for theCompany on its settlement and that such loss is reasonably quantifiable.
Restructuring provisions include employees’ termination payments which are directly related to workforce
restructuring plans. No provisions are recognised for future losses. Where there is a number of similar obligations, thelikelihood that an outflow will be required is determined by considering the different classes of obligations as a whole.
Where the effect of the time value of money is material, the provision is measured as the present value of the expected
expenditure, discounted using a pre-tax discount rate.
Contingent liabilities are not recognised in the financial statements but are disclosed in the Notes thereto insofar as they
are not considered remote.

4.10

Indemnities for termination

In accordance with current legislation, the Company is required to make severance payments to employees whose
contracts of employment are terminated in certain circumstances. Therefore, the indemnities for termination that canbe reasonably quantified are recorded as a cost in the financial year in which the decision to terminate the contract istaken and a valid expectation regarding termination is created for third parties.

33

All amounts are in millions of Euros, unless otherwise stated

4.11

Pension commitments

4.11.1 Defined benefit pension commitments
A defined benefit plan is a pension plan that defines the amount of the pension that an employee will receive on
retirement, dependent on one or more factors such as age, length of service and salary. In a defined benefit plan the
Company may pay contributions into a separate entity or pension fund. ACyC and, in some cases, the employees who
participate in funding a defined benefit plan have the legal or constructive obligation to make further contributions if
the fund does not have sufficient assets to pay the benefits due to all employees for the rights acquired in the current or
prior periods.
The amount recognised as a defined benefit pension liability is the present value of the obligation at the end of thereporting period, less the fair value at that date of the plan assets (if any) out of which the obligations are to be settled.
The recognition of assets that arise by over-funding of the defined benefit plan is limited to the ability to using thesurplus to generate future benefits (the asset ceiling). The defined benefit obligation is calculated annually byindependent actuaries using the projected unit credit method. The present value of the benefit is determined bydiscounting the estimated future cash outflows using interest rates on high-quality corporate bonds that are
denominated in the currency in which the benefits will be paid and that have terms to maturity that approximate theterms of the related pension liabilities.
The present value of the defined benefit, which includes actuarial gains and losses, the return on the plan assets (notincluding net interest that is calculated by applying the discount rate) and the effect of the asset ceiling (if any, excludinginterest), is recognised immediately in other revenue and expenses recognised in equity. ACyC determines the netinterest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used tomeasure the defined benefit obligation defined at the beginning of the annual period, taking into account any changes
in the net defined benefit liability (asset) during the period as a result of contributions and benefit payments. Net interest
expense and other expenses related to defined benefit plans are recognised in the profit and loss statement.
The non-recognition of assets (‘asset ceiling’) can occur when the plan assets are higher than the projected benefits andACyC cannot recover any surplus due to solvency and/or control requirements.
When the conditions of a plan are changed or the obligations of a plan are discharged, the resulting impact on benefits
related to past services or the gain or loss from that change is recognised immediately in the profit and loss statement.
If the changes to the pension plan are conditional on the employees remaining in service for a specified period of time(the vesting period), the related past service costs are amortised on a straight-line basis over the vesting period. ACyC
recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.
Expenses for defined benefit pension commitments are classified as follows:-

Service expense (including current service cost, past service cost, as well as gains and losses on curtailments andsettlements);
Administration costs;
Net interest expense or income;Remeasurement.

The first two components of defined benefit pension commitments are presented in the profit and loss statement under
net administration costs. The net interest is presented under finance expenses. Curtailment gains and losses areaccounted for as past service costs. Remeasurements are recognised in other income and expenses recognised in equity.
The characteristics of those commitments are described in Note 14.1.
Defined benefit pension commitments in Spain
According to article 6L of the General Spanish National Collective Bargaining Agreement (CBA) for Insurers, Reinsurers
and Occupational Accident Mutual Societies, on reaching retirement age an employee may elect to retire or retirement
may be decided by the employer, with a lifelong economic compensation, in both cases, payable by the employer andconsisting of the difference between the pension received by the employee from the Social Security General System andthe percentages set out in the CBA. These commitments do not apply to personnel hired as from 9 June 1986 fromcompanies not included in the scope of the sector CBA.
The CBA also includes coverage for the contingencies of death or disability of employees during their employment.

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Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

At the end of 1986, Crédito y Caución set up an alternative employee retirement plan to the above system, expanding
the commitments under the CBA, which were externalised in insurance policies.
During 2005, the Company adapted its commitments to the terms of Additional Provision Fifteen of Law 44/2002 of 22
November 2002 on Measures for Reform of the Financial System, by contracting insurance policies with the insurers
Seguros Catalana Occidente S.A. de Seguros y Reaseguros and Axa Aurora Vida S.A.
In the case of insurance policies contracted with non-related entities, the assets earmarked to meet these commitments,“plan assets”, are not owned by the Company but by a legally independent entity and can only be used to pay or fundthe employee contributions. They can only be returned to the Company if the plan assets are sufficient to discharge allof the obligations.

4.11.2 Defined contribution pension commitments
Defined contribution plans are post-employment benefit plans under which ACyC pays fixed contributions into aseparate entity (a fund) and has no legal or constructive obligation to pay further contributions if the fund assets are notsufficient to pay all employee benefits relating to employee service in the current and prior periods.
For defined contribution plans, ACyC pays contributions to publicly or privately administered pension plans on a
mandatory, contractual or voluntary basis. ACyC has no further payment obligations once the contributions have been
paid. The contributions are recognised as employee benefit expenses when they fall due. Prepaid contributions arerecognised as an asset to the extent that a cash refund or a reduction in the future payments is possible. The
contributions to these plans are recognised as expenses in the profit and loss statement. The characteristics of thosecommitments are described in Note 14.1.
Defined contribution pension commitments in Spain
In 2007, the Company set up a complementary employee benefit system in the form of a company social security planthat provides benefits for retired employees and for those who suffer full and permanent disability that incapacitates
them to perform their regular job or absolute permanent disability for all types of work, major disabilities and death.
The Company has adapted the related insurance contracts to Royal Decree 1588/1999 of 15 October 1999 that approved
the regulations on formal arrangements for company pension commitments.
In 2017, a new social security system was approved with the aim of promoting an appropriate employment policy forthe sector. It has been implemented through a defined contribution group life insurance policy suitable forexternalisation of the pension commitments. This system applies automatically to staff hired as from 1 January 2017
and to the previously hired employees who were given the option of keeping the retirement economic incentive staff
regulated in the previous CBA or of enrolling in this new plan.

4.11.3 Special retirement plan
During 2015 the Company prepared a special retirement plan for a group of employees who meet a series ofrequirements of seniority and years of paid affiliation to the Social Security system.
The “Non-technical provisions – provision for pensions and similar obligations” on the balance sheet at 31 December
2022 includes EUR 1.7 million to fund the commitments with those employees (2021: EUR 1.7 million).

4.12

Related party transactions

The Company´s transactions with related parties are all done at market prices. In addition, the transfer prices are fully
supported and the Company’s Directors therefore do not consider that there is any significant risk in this regard that
could produce a liability in the future.

4.13

Income and expenses

According to the PCEA, income and expenses are generally recognised on an accrual basis, that is, when the actual
transfer of goods and services occurs, irrespective of the timing of the related financial or monetary flow. Revenues arestated at the fair value of the consideration received, less discounts and taxes.

35

All amounts are in millions of Euros, unless otherwise statedPremium income is recorded on the dates the related invoices are issued for the estimated provisional premium (credit
insurance) or final premium (bonding). This provisional premium is later adjusted to match the actual sales insured. At
31 December 2022, EUR 165.2 million was recorded in “Other assets – Accrual accounts” for premiums accrued and notissued net of commissions and reinsurance (2021: EUR 130.1 million).
That line item also includes deferred expenses of EUR 16.3 million (2021: EUR 13.5 million).
The reclassification of expenses by nature to expenses by use is done applying objective criteria to the various existing
parameters, namely: volume of transactions, number of employees and investments used in the business process, etc.,
as described in Note 2.5.
Premiums accrued and not issued
Premiums accrued and not issued refer to insured sales made by ACyC customers in which ACyC covers the risk insured
by the policy, but which have not yet been issued. Premiums accrued and not issued are defined as the part of theinsurance premium that has been accrued but not yet issued at the end of the reporting period. Although the calculationof premiums accrued and not issued stems from the underwriting operations and is made at the policy level on aparametrised basis, the Company considers all specific elements of analysis that can have an impact on the calculation.
Premiums for covered risks depend on the amount of business insured during the period of reference, when not all of
the business has been reported at the end of that period. A second element to consider is that for the policies the final
premium will depend on the claims rate of the policy. Given that the result attributable to the policy is not fully knownat the analysis date, part of the final amount of the premium accrued but not yet due reflects estimates. The assumptions
employed in making those estimates are based on the most recent trends of the insured business, specific informationon the customers, information on pending claims and, where relevant, macroeconomic information. It is that changing
macroeconomic information, within the context of an unprecedented pandemic, which requires quantification of theadditional uncertainty with respect to the normal process followed to estimate premiums accrued and not issued, inorder to ensure that the possible future behaviour of that parameter does not have a negative effect on the financial
statements in the coming years. The positive historical evolution of this process indicates that any potential deviation
in insured sales not reported during a pandemic without precedent and in an uncertain economic environment would
be covered without having a significant impact on premium revenue. The Company nonetheless conducts a detailed
analysis of the different components included in the automated calculations of the modelled premium, making
adjustments to those which the Company considers could prove more uncertain in the current environment of low
claims rates (given its impact on the bonus component of the accrued premium pending issuance) or the deviations in
the estimates of insured sales (reconciliation invoices).

4.14

Cash and cash equivalents

This balance sheet line includes cash, composed by cash on hand and deposits held on call with banks, as well as cash
equivalents. Cash equivalents correspond to other short-term highly liquid investments with original maturities of threemonths or less that are subject to an insignificant risk of changes in their fair value.

36Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

5Intangible assets

The breakdown and movements of this balance sheet heading in 2022 and 2021 are as follows:

2022

Balances at cost at 1 January
Additions
Retirements

Goodwill

Computerapplications

Portfolioacquisition

Total

45,826326,102

17,049388,977-

23,263-23,263

-

(119)

-

(119)

(23)

(6,874)71(6,826)

Balances at cost at 31 December

45,803342,372

17,120405,295

Accumulated amortisation and impairment at 1 January(27,507)(246,949)(17,049)(291,505)

Allocations with a charge to the profit and loss statement(4,583)(8,324)-(12,907)

Retirements

-

84

-

84

Impairment

-

(435)

-

(435)

Effect of changes in foreign exchange rates
Accumulated amortisation and impairment at 31 December(32,090)

5,524(250,100)(71)(17,120)

5,453(299,310)

Balances at 1 January

18,31979,153-

97,471

Balances at 31 December

13,71392,272-

105,985

Goodwill

Computerapplications

Portfolioacquisition

Total

293,614

16,967356,407356,407

Additions-30,653-30,653Retirements-(6,042)-(6,042)

Effect of changes in foreign exchange rates

-

7,877

82

7,959

Balances at cost at 31 December

45,826326,102

17,049388,977

Accumulated amortisation and impairment at 1 January(22,923)(191,923)(16,967)(231,813)

Allocations with a charge to the profit and loss statement

Effect of changes in foreign exchange rates

2021

Balances at cost at 1 January(4,584)(14,015)-(18,600)

Retirements

-

6,041

-

6,041

Impairment-(40,992)-(40,992)

Effect of changes in foreign exchange rates
Accumulated amortisation and impairment at 31 December(27,507)(6,060)(246,949)(82)(17,049)(6,142)(291,506)

Balances at 1 January

22,903

101,691-

124,594

Balances at 31 December

18,31979,153-

97,471

Goodwill
If applicable, impairment of goodwill is recognised as a separate item on the profit and loss statement. ACyC assessed
the possible impairment of its goodwill. No impairment was recognised in 2022, just as in 2021.
The goodwill allocated to the main cash generating units (CGU) or groups of units is shown below:

37

All amounts are in millions of Euros, unless otherwise statedCash Generating Units

2022

2021

ACyC branch France

2,700

3,601

736

1,012

9,304

12,408

ACyC branches in Nordic countries
ACyC branch Germany
ACyC branch Switzerland
Total

973

1,298

13,71318,319(1) The goodwill of the Nordic countries unit includes the bonding business in Denmark, Norway, Sweden and Finland.

The value in use of an individual CGU is determined using a dividend discount model (DDM). The dividend flows are
estimated using a projection period and a normalised period. Long term projections are applied to ensure cover throughthe-economic cycle performance. The projection period is 10 years towards, where the first 1-4 year projections are
based on financial budgets and/or forecasts. The remaining years are estimated using ratios and growth rates thatconverge towards their normalised term value. The discount rate, gross of tax, varies depending on the Risk-Free Rateand the Country Risk Premium of the country where the CGU is located. For those CGUs with Goodwill higher than EUR
10 million (ACyC), the discount rate applied is between 6.7% and 8.9% and the growth rate is between 1% and 2%,
respectively. The terminal value is calculated based on the dividend flows of the normalised period through a perpetuity
which applies a long term growth rate of 2% for CGUs excluding ACyC and a 3% for associated companies (2021: 2%-3%)
and the specific discount rate. Any profits, after fulfilling minimum capital requirements, are assumed to be
distributable dividends. Minimum capital requirements are calculated taking into account local solvency rules, theSolvency II Partial Internal Model and minimum shareholders equity required (non-distributable).
The sums seen for the CGUs in France, Germany and Switzerland were due to restructurings via mergers of the Group's
credit insurance companies. The Nordic CGU refers to the bonding line. Both restructurings were carried out in 2005 via
an aggregation of businesses of the former ACI. The changes generated during 2022 are mainly due to amortisation of
goodwill (see Note 4.1.1).
The business plans of the CGUs are consisted with the expected claims rates and are approved by the Executive
Committee.
In the sensitivity analysis of the following assumptions, the market value of the CGUs would be impacted in thefollowing percentages (other CGUs are not included because they are not material):

Combined ratio

Solvency
Ratio(1)+50pb+1,000bp -1000bp

Cash Generating Units

Discounte rate

Growth rate

2022

+50pb

+50pb

ACyC branch France-10.3%

13.2%

-7.2%

-3.6%

-3.6%

3.6%

ACyC branches in Nordic countries-12.1%

16.1%

-8.9%

-4.3%

-4.3%

4.3%

-4.6%

4.6%

ACyC branch Germany

-8.0%

10.5%

-5.6%

-5.2%

-5.2%

5.2%

-5.0%

5.0%

ACyC branch Switzerland

-8.9%

12.1%

-6.4%

-3.6%

-3.6%

3.6%

-3.5%

3.5%

Combined ratio

Solvency
Ratio(1)+50bp+1,000bp -1000bp

-50pb

-50pb

Cash Generating Units

Discounte rate

Growth rate

2021

+50bp

+50bp

ACyC branch France-18.3%

-50bp
31.2%

-15.4%

-50bp
-3.4%

-3.4%

-50pb

-50bp

-0.7%

0.7%

3.4%

-4.2%

21.0%

ACyC branches in Nordic countries-17.4%

27.9%-14.3%

-3.7%

-3.7%

3.7%

-4.4%

4.4%

ACyC branch Germany-21.4%

40.5%-18.3%

-5.7%

-5.7%

5.7%

-7.9%

7.9%

ACyC branch Switzerland-20.0%

36.5%-17.0%

-2.7%

-2.7%

2.7%

-1.5%

1.5%

1)

For the same required capital.

38

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

None of the previously mentioned sensitivity analyses would imply a book value of the CGUs greater than theirrecoverable value.
Computer applications
ACyC assessed all capitalised software to determine if the criteria for capitalisation are being met (see Note 4.1.2
Aplicaciones informáticas). Based on that assessment, ACyC decided to recognise an impairment loss of EUR 0.4 million
in its in-house software (2021: EUR 41 million) mainly relating to the need to redesign some of the solutions in its
transformation programmes, including data models, user needs, use of shared components, new functionalities andmultichannel/omnichannel integrations to deliver a better customer experience. In addition, during 2022, ACyC
capitalised EUR 20 million primarily in respect of the Atradius Business Transformation project (ABT) (2021: EUR 29.1
million).
The amount recorded for computer applications in branches outside Spain totalled EUR 91.1 million (2021: EUR 93.3
million).
At 31 December 2022 and 2021there were no fully amortised intangible assets still in use. The whole of the intangible
assets that were fully amortised by year-end 2022 have been derecognised on the balance sheet in the amount of EUR
84 thousand (2021: EUR 6 million).

39

All amounts are in millions of Euros, unless otherwise stated

6

Property, plant and equipment and investment property

The breakdown and movements of this balance sheet heading in 2022 and 2021 are as follows:
Furnitureand fixtures

Data
processing
equipment

Total

2022

Land andbuildings

Balances at cost at 1 January

62,491

56,18647,390166,067

-

1,572

4,320

5,892

(1,162)(3,570)(5,063)(9,795)-(806)(1,100)(1,906)

Balances at cost at 31 December

66,78147,93045,547160,259

Accumulated depreciation and impairment at 1 January(19,685)(34,311)(38,087)(92,083)

Charge to the profit and loss statement(826)(2,814)(5,095)(8,735)Retirements

761

2,958

4,208

7,927

-

525

929

1,454

Accumulated depreciation and impairment at 31
December(19,750)(33,642)(38,045)(91,437)

Balances at 1 January
Balances at 31 December

42,80647,031

21,875
14,288

9,303
7,502

73,984
68,822

Furnitureand fixtures

Data
processing
equipment

Total

2021

Land andbuildings

Balances at cost at 1 January

63,14058,26246,019167,421Additions
Retirements
Effect of changes in foreign exchange rates

Effect of changes in foreign exchange rates

Additions

-

8,941

5,694

14,635Retirements(657)(12,113)(5,715)(18,485)

8

1,096

1,392

2,496

Balances at cost at 31 December

62,491

56,18647,390166,067

Accumulated depreciation and impairment at 1 January(19,188)(37,513)(35,111)(91,812)Charge to the profit and loss statement(734)(7,949)(7,369)(16,052)

Retirements

186

11,861

5,525

17,572

-

-

(53)

(53)

54

-

-

54

Effect of changes in foreign exchange rates
Accumulated depreciation and impairment at 31
December(3)(19,685)(710)(34,311)(1,079)(38,087)(1,792)(92,083)

Balances at 1 January
Balances at 31 December

43,95242,806

20,74921,875

10,9089,303

75,60973,984

Effect of changes in foreign exchange rates

Deterioro con cargo a la cuenta de pérdidas y ganancias
Reversal of impairment losses

At 31 December 2022, a total of EUR 0 miles (2021: EUR 54 miles) of impairment adjustments were reversed.
40

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

At year-end 2022 and 2021, none of the fully depreciated property, plant and equipment remained in use. The whole ofthese assets that were fully depreciated by year-end 2022 have been derecognised on the balance sheet in the amountof EUR 7.9 millones (2021: EUR 17.6 millones).
At 31 December 2022, the value allocated to the real estate awarded to the Company in foreclosures in and out of court
by the debtors of its insureds was EUR 1.2 million (2021: EUR 1.4 million). The Company maintains proper nonaccounting control of those property assets.
Shown below is a breakdown of the land and buildings recorded in the preceding table at 31 December 2022 and 2021:
Carrying
Value (Gross)

Accumulated
Depreciation

Accumulated
Valuation
Adjustments

Total

55,689(15,604)(245)

39,840At 31 December 2022
Property, Plant and Equipment
Investment Property

11,092(3,808)

(93)

7,191

Total

66,781(19,412)(338)

47,031

Property, Plant and Equipment

55,689(14,939)(242)

40,508Investment Property

6,802(4,411)

(93)

2,298

Total

62,491(19,350)(335)

42,806

At 31 December 2021

Shown below is the separate gross value of the buildings and land owned by the Company at year-end 2022 and 2021:
Property, Plant
and Equipment

Investment
Property

Total

Land

22,512

1,206

23,718

Buildings

33,1779,886

43,063

Total

55,689

11,092

66,781

At 31 December 2022

At 31 December 2021
Land

22,512

1,438

23,950

Buildings

33,177

5,364

38,541

Total

55,6896,802

62,491

The attached Annex gives a breakdown of the land and buildings owned by the Company at 31 December 2022 with thefollowing information for each asset: classification as own-use property, plant and equipment or as investment property(rented or for sale), gross book value, accumulated depreciation, accumulated valuation adjustments, location, appraisedvalue and appraisal date. Land has an unlimited useful life and is therefore not depreciated.
The Company has several insurance policies with Grupo Catalana Occidente, S.A. to cover the risks to which its
properties in Spain and Portugal are exposed. The coverage afforded by those policies is considered sufficient.
The investment properties held by the Company at 31 December 2022 are rented out, mainly for offices and commercial
activities. In 2022, the rent revenue from the investment properties owned by the Company amounted to EUR 0.5
million (2021: EUR 0.3 million), which is recorded under “Income from property, plant and equipment and frominvestments – Income from investment property” on the attached non-life insurance technical account for the year.
The Company held the following investment properties other than land and buildings located outside of Spain at yearend 2022 and 2021:

41

All amounts are in millions of Euros, unless otherwise stated2022
Carrying Value(Gross)Accumulated
Depreciation

2021
Carrying Value(Gross)Accumulated
Depreciation

Furniture and Fixtures

42,998(32,586)

45,801(33,738)

Data processing equipment

42,748(36,519)

44,569(37,074)

Total

85,746(69,105)

90,370(70,812)

7

LeasesThe non-cancellable operating lease commitments are shown below:
2022

2021

Less than 1 year

19,84020,458Between 1 and 5 years

49,91349,918More than 5 years

33,63917,941

Total

103,392

88,317

ACyC leases office equipment and office space under a number of operating lease agreements. The lease agreements
have remaining terms of between 1 and 20 years. Leasing of office space accounts for around 93.0% ((2021: 93.0%) of
the expected total future payments.
The Company is lessee in leases with third parties that during 2022 generated a cost of EUR 23.8 million (2021: EUR
22.2 million).
At 31 December 2022, the Company was lessor in leases with third parties of part of its investment properties.
The leased property assets are listed in the attached Annex and, as explained in Note 6, most of those properties are used
for the commercial offices of the Company's network of agents. Lease revenue is detailed in Note 6. All of the leases havea term of one year and are renewal and no contingent rent payments were recognised as income during the year.

42

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

8

Financial assets, cash and cash equivalents

8.1

Cash and cash equivalents
2022

2021

Cas at bank and at hand
Efectivo restringido
Bank deposits

260,499
119,070
20,113345,682
1,641

Total

399,682

347,323

ACyC forms part of the Atradius centralised cash pooling system that involves different cross-border arrangements. Thissystem provides a cash pooling structure with interest compensation per currency. The cash pool arrangements allow
for offsetting of cash balances within the same legal entity, but do not allow offsetting between different legal entities.
In 2022 it was decided to reclassify from "restricted financial investments" to "cash and cash equivalent" the deposits
that meet the criteria established by the standard for this category. This cash is not available to the Company for
immediate or general business use neither to spend, nor to invest. (2021: EUR 45 million).

8.2

Financial assets

There follows a breakdown of the different financial instruments owned by the Company. These assets do not include
investments in Group companies, which are detailed separately in Note 9.
Investments Classified byCategory and Nature of
the Financial Assets

Cash and cash
equivalents

Available-for-Sale
Financial Assets at Fair
Value
2022
2021

2022

2021

-

-

303,803

Debt securities

-

-

Loans

-

Deposits in credit
institutions

Loans andReceivables 1)

Total

2022

2021

2022

2021

394,133--

303,803

394,133

1,477,445

1,277,063--

1,477,445

1,277,063

-

-

-

-

-

-

-

-

-

-

-

43,07360,01543,07360,015

Other financial assets

399,682

347,323

-

-

-

-

399,682

347,323

Total

399,682

347,323

1,781,248

1,671,196

43,07360,0152,224,003

2,078,534

Equity instruments- Financial investmentsin equity

1) In 2022 and 2021 there were no deposits with tacit renewal.

43All amounts are in millions of Euros, unless otherwise statedShown below are the movements in financial assets:

Available-for-sale financial assets

EquityInstruments

Debt Securities

Deposits in
CreditInstitutions and
Other
Investments

Total

Balances at 1 January394,134

1,277,064

60,015

1,731,213

Additions

123,046664,978

82,884

870,908

Retirements(181,376)(349,823)(100,922)(632,121)

Writedowns
Gains/losses recognised on sale
Changes in value against reserves
Impairment losses
Effect of changes in foreign exchange rates

27,930(59,999)(413)
481(8,181)(15,291)(95,629)
4,331

1,095

(8,181)
12,639(155,628)
(413)
5,907

Balances at 31 December

303,803

1,477,449

43,072

1,824,324

2022

Available-for-sale financial assets

EquityInstruments

Debt Securities

Deposits in
CreditInstitutions and
Other
Investments

Total

Balances at 1 January292,671

1,071,889

19,3291,383,889

Additions60,983

577,579

67,433705,995

Retirements(8,571)(361,730)(29,411)(399,712)

Writedowns-(8,967)-(8,967)

Gains/losses recognised on sale
Changes in value against reserves
Impairment losses
Effect of changes in foreign exchange rates(163)
47,567(964)

2,410(12,940)
-

-

2,247
34,627
(964)

2,611

8,823

2,664

14,098

Balances at 31 December

394,134

1,277,064

60,015

1,731,213

2021

At 31 December 2022, there had accrued explicit interest on fixed-income securities and deposits in credit institutionsof EUR 10.1 million (2021: EUR 7.4 million), which is included in “Other assets – Accrual accounts” on the accompanying
balance sheet at that date.
The fair value of financial instruments has been determined as follows:
The fair value of equity investments has been obtained from the market trading prices. For shareholdings inunlisted companies the fair value has been determined using valuation techniques generally accepted in thefinancial sector.
Fixed-income securities are measured by reference to their market trading prices or using valuation techniques
generally accepted in the financial sector.
Holdings in mutual funds have been measured by reference to the net asset value published by the managementcompanies. Unlisted funds will be measured by an external independent valuation company or the asset managerof illiquid mutual funds.

44Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

The following tables present the fair values of the financial instruments recorded at fair value:
Financial instruments measured at fair value Assets

Level 1

Level 3

Total

2022
Available for sale:
Equity securities

272,154

31,649303,803

Government bonds

197,777-

197,777

Corporate bonds

781,718-

781,718

Total

1,251,649

31,6491,283,298

Financial instruments measured at fair value Assets

Level 1

Debt securities:

Level 3

Total

2021
Available for sale:
Equity securities

367,010

27,123394,133

Government bonds

185,981-

185,981

Corporate bonds

1,091,082-

1,091,082

1,644,073

27,123

1,671,196

Debt securities:

Total

At 31 December 2021, the Company was primarily exposed to securities traded on active markets (Level 1), although
reclassifications and new investments have also added exposure to illiquid markets (Level 3).
Reconciliation of Level 3 fair values
The following tables detail the changes in the fair value of Level 3 financial investments (valuation techniques
incorporating information other than observable market data):

Financial investments Level 3

Equity securities
2022

2021

Balance at 1 January

27,123

22,910Total gains or losses:--

In statement of recognised income and expense

1,107

(103)

Purchases/Sales

3,419

4,316

Balance 31 at December

31,64927,12345

All amounts are in millions of Euros, unless otherwise stated

The breakdown by maturity of the different categories of financial instruments classified is as follows:

At 31 December 2022

Available

Available-for-sale financial
assets:- Debt securities
Loans and receivables:- Deposits in credit institutions
and loans
Other financial assets
Total

At 31 December 2021
Available-for-sale financial
assets:- Debt securities

Less than 1 year

1 to 5 years

More than 5
years

Total

-

213,229

1,238,208

26,0081,477,445

703,485
703,485

43,073
256,3021,238,208

26,00843,073
703,485
2,224,003

Available

Less than 1 year

1 to 5 years

More than 5
years

Total

-

156,744

1,072,594

47,725

1,277,063

Loans and receivables:- Deposits in credit institutions
and loans
Other financial assets

741,456

60,015---60,015
741,456

Total

741,456

216,759

1,072,594

47,7252,078,534

The average annual yields in 2022 and 2021 on fixed-income securities and other similar financial investments,
classified by homogeneous issuer group, are shown below:% Yield2022

2021

Bonds issued by private entities

3.48%

0.16%

Bank deposits

0.24%-0.01%

The following table presents a breakdown of gains and losses on disposal of debt securities and equity securities in the“Available-for-sale financial assets” portfolio in 2022 and 2021:
2022

2021

Gains recorded in the profit and loss statement on sale

31,3532,998

Losses recorded in the profit and loss statement on sale

(18,714)(751)

Information on the nature and level of risk of the financial instruments
The most important components of financial risk are market risk, credit risk and liquidity risk.
The Company invests in a diversified portfolio of capital instruments to mitigate those risks.

46

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y ReasegurosMarket Risk

Market risk is the risk that the fair value of assets and liabilities that are sensitive to movements in market prices will
decrease or increase due to adverse movements in equity prices, interest rates or exchange rates. The Company is
exposed to these risks by holding assets and liabilities whose fair value is sensitive to movements in those prices. Theserisks are measured using the mismatch between assets and liabilities whose fair value is denominated in foreign
currency, Value at Risk, capital models of credit risk rating institution and the duration of interest rates, among others.
ACyC uses the capital approach available under the Solvency II Directive to define strategic asset allocation and assess
the impact of investment decisions to ensure sufficient capital under Solvency II.
The estimates of the fair value of ACyC's financial assets and liabilities are their carrying amount.
The assets are exposed to increases in inflation and/or in inflation forecasts, which could accompany increases ininterest rates and lead to a decrease in the market value of bonds held in our investment portfolio. Increases in inflation
could also have an impact on the creditworthiness of bond issuers and could result in an increase in credit spreads. Allof these factors could lead to a decline in the value of the bonds.
Inflation in the costs of claims, labour costs, cost of energy and raw materials, and/or inflation due to disruptions in the
global supply chain could impact the industry. The impact of inflation on claim costs could be more pronounced forcertain of our claims that are indexed to inflation and for bonding business which is considered “long tail”.
The fair values are based on the price, as best estimate, which would be received on selling an asset or paid ontransferring a liability in an orderly transaction between market participants at the measurement date. Wheneverpossible, the fair values are based on quoted market prices. If there is no quoted market price available, valuation
techniques are used that are based on market prices of comparable instruments or on observable market observable
data. If no observable market inputs are available, valuation models are used (non-market observable data). Thesevaluation techniques are subjective in nature and rely on pricing assumptions. Deviations in those assumptions may
significantly affect the estimated fair values. Consequently, the fair values presented may not be indicative of the net
realisable value. In addition, the calculation of the estimated fair value is based on market conditions at a specific point
in time and may not be indicative of future fair values.
The fair values are subject to a control environment designed to ensure that they are determined or validated by afunction that is independent of the owner of those risks. Toward this end, ACyC defines the accounting policies andprocesses that govern the measurements and at the same time ensure compliance with the applicable accounting
legislation. Within this governance structure, non-quoted investments or illiquid investments in which ACyC invests
are measured by an external independent valuation company or the asset manager of the illiquid investment fund.
Those firms use their own proprietary valuation systems to measure the securities based on economic and market
assumptions from financial information providers. The valuations are provided on a monthly basis and are reviewed
and approved by ACyC. The valuation process of the asset manager is audited and approved by its statutory auditor.


Credit Risk

With regard to managing the credit risks of its financial investments, the investment policy of ACyC is to hold aprincipally euro-centric, internationally diversified portfolio and to avoid large risk concentrations. From a Standard &Poor’s rating scale or comparable perspective, the fixed income portfolio is almost completely invested in investment
grade debt securities with an ‘A-‘ rating or stronger. If a debt security bond in which ACyC has invested falls below theminimum credit rating or is not rated, it must be reviewed by the Atradius Investment Committee to decide whether theinvestment fund is still a suitable investment. The maximum concentration limit per issuer is 5% of the market value ofthe financial investments of the entity. Concentration per issuer is evaluated by aggregating the exposure to a single
issuer through both debt investments and equity securities. The Atradius Investment Committee monitors this limit andthe appropriate actions are taken if a concentration limit is breached.
The counterparty credit ratings and the credit rating of the debt instruments are predominantly based on Standard &Poor’s rating. In the absence of a Standard & Poor’s credit rating, the Atradius uses Moody’s or Bloomberg Composite
ratings.

47

All amounts are in millions of Euros, unless otherwise stated

Liquidity Risk

ACyC is exposed to liquidity risk if there is insufficient cash available to meet its financial obligations, when due, at areasonable cost. For ACyC, liquidity risks may arise if large-scale short-term fluctuations occur in cash flows, such as adecline in cash inflows or a rise in cash outflows, or a combination of both.
Liquidity risk is managed at Atradius level, in close coordination with local operations. The Atradius policy is to monitor
and measure ongoing cash flow patterns and control liquidity by maintaining sufficient cash and highly marketablesecurities to reduce liquidity risk to acceptably low levels. The investment policy states that ACyC should only invest in
financial instruments that can be liquidated within three business days or less. ACyC is able to access credit facilities toprevent liquidity shortages that can arise due to short-term cash flow variances. ACyC maintains uncommitted credit
lines in excess of EUR 1 million. It is an overdraft facility for a total of EUR 50 million (2021: 50 million euros). The credit
line provides liquidity to cover infrequent peaks in short-term liquidity requirements while also permitting ACyC to
reduce its cash balances and to benefit from a broader and more and stable investment portfolio. Lastly, ACyC has inplace a simultaneous claims payment clause in the main reinsurance treaties. This clause allows ACyC to ask thereinsurers to accelerate the payment of a large claim upon ACyC’s request instead of the usual payment terms agreed in
the reinsurance treaties.

48

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

9 Investments in Group companies, jointly controlled entities andassociates
The following table presents the most significant information on the Group companies, jointly controlled entities andassociates at year-end 2022 and 2021:

49

All amounts are in millions of Euros, unless otherwise stated

Business
2022

Iberinform Internacional,
S.A.
(Paseo de la Castellana, 4Madrid)Information
ServicesB2B Safe, S.A.
(Paseo de la Castellana, 4Madrid)Advisory
Services

Iberinmobiliaria, S.A.
(Paseo de la Castellana, 4Madrid)Real Estate

Crédito y Caución do Brasil Management
Gestao de Riscos deCompany
Crédito e Servicios LTDA
(Avda Angelica, 2530 Sao
Paulo)
Atradius Crédito y Caución Domestic and
Seguradora, S.A. (Avda
foreign credit
Angelica, 2530 Sao Paulo)
insurance

Business
2021

Iberinform Internacional,
S.A.
(Paseo de la Castellana, 4Madrid)B2B Safe, S.A.
(Paseo de la Castellana, 4Madrid)%Holding

Net Value oftheInvestment

Dividends
received
in 2022

Share
Capital(1)EquityReserves(1)Profit for
the year(1)

100%

6,311

-

6,311

4,652

1,805

100%

57

-

60

2

(4)

100%

60

-

60

16

(0.4)

100%

693

-

1,300

2,257

1,045

100%

9,372

-

7,445

3,690

1,989

16,493---%
Holding

Net Value oftheInvestment

Dividends
received
in 2021

Share
Capital(2)EquityReserves(2)Profit for
the year(2)

100%

6,311

19,000

6,311

1,907

2,745

100%

57

-

60

5

(3)

100%

60

-

60

17

(1)

100%

693

-

1,231

1,363

775

100%

9,372

-

7,049

1,492

2,002

16,49319,000Information
Services

Advisory
Services

Real Estate
Iberinmobiliaria, S.A.
(Paseo de la Castellana, 4Madrid)Crédito y Caución do Brasil Management
Gestao de Riscos deCompany
Crédito e Servicios LTDA
(Avda Angelica, 2530 Sao
Paulo)
Atradius Crédito y Caución Domestic and
Seguradora, S.A. (Avda
foreign credit
Angelica, 2530 Sao Paulo)
insurance(*)

Includes indirect participations in subsidiaries.

(1)

Data obtained from 2022 financial statements of each investee company, pending approval by their respective control bodies. Nevertheless, the Directors of theCompany estimate that those financial statements will be approved without changes.
(2)

Data obtained from the 2021 financial statements of each investee company.

None of the subsidiaries is quoted on the stock market.

50

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Note 18 “Transactions and balances with related parties” gives a breakdown of the positions with Group entities
according to their carrying value in the Company's books.

10 Receivables on insurance and reinsurance operations and otherreceivables
The breakdown of accounts receivable from insurance and reinsurance contracts, along with other receivables, ispresented below:
2022

2021

2,320
119,394
98,2373,201
108,351
89,067

Direct business and coinsurance

116,546

103,186

Provision for uncollected premiums(18,309)(14,119)

21,157

19,284

21,157

19,284

Receivables on reinsurance operations

111,881

91,092

Receivables from reinsurers

116,120

94,129Provision for impairment of receivables from reinsurance(4,239)(3,037)

203,978

195,088717

316

203,261

194,772

437,573

397,732

Deposits made for accepted reinsurance
Accounts receivable on direct insurance operations
Policyholders – outstanding invoices

Brokers
Receivables from brokers

Other receivables
Tax receivables
Rest of receivables
Total
Shown below is a breakdown of “Other receivables – Rest of receivables”:

2022

2021

Recovery receivables (Note 16.1)
Recoveries pending allocation

37,903
3,841

27,311
3,226

Recovery management expenses pending application

7,363

7,216

Invoiced study expenses

11,43010,922

Amounts owed by Group companies (Note 18.1)

95,57360,987

Others47,151

85,110Total

203,261

194,772

Note 16 on “Technical information” includes the estimated movements in recoveries in 2022 and 2021.
The “Other receivables” line item on the balance sheet records recoveries obtained during the claims management
process that at the end of the year were pending allocation to specific claims. Also included in that line item the expenses
arising from the management process mentioned before which, though already allocated to specific claims, are pendingof inclusion in the settlement of the claim.
“Other receivables – Other” mainly records deposits held in compliance with legal or contractual obligations.
There follows a breakdown of the movement recorded in provisions in 2022 and 2021:

51

All amounts are in millions of Euros, unless otherwise stated2022

Provision foruncollected
premiums

Provision for
impairment ofreceivablesfromreinsurance

Balances at 1 January(14,119)(3,037)

Allocations with a charge to the profit and loss statement(18,309)(4,239)Applications with a credit to the profit and loss statement
Balances at 31 December

14,119(18,309)

3,037(4,239)Provision foruncollected
premiums

Provision for
impairment ofreceivablesfromreinsurance

Balances at 1 January(13,603)(861)

Allocations with a charge to the profit and loss statement(14,119)(3,037)

Applications with a credit to the profit and loss statement

13,603

861

Balances at 31 December(14,119)(3,037)2021

11 Debts and payables
Shown below is the breakdown of debts and other accounts payable under insurance and reinsurance contracts,
together with other accounts payable, at year-end 2022 and 2021:
2022

2021

Deposits received for ceded reinsurance

9,903

11,556

Payables on insurance operations

74,08969,482

Payables to policyholders

41,92541,515

Payables to brokers

18,532

15,194(1)

13,632

12,773

Payables on reinsurance operations

Conditional payables

182,534

376,670

Other accounts payable

129,611

121,960

Tax and employee payables

7,616

6,813

Other accounts payable to Group companies and associates (Note 18.1)

49,31541,314

Rest of payables

72,68073,833396,137

579,668

Total

The significant decrease during 2022 is explained by the settlements with the Governments in ACyC UK, ACyC Germany
y ACyC Spain and the liability cancelation with Grupo Catalana Occidente, S.A. related to the Corporate Tax payments.
In the preceding table, “Other accounts payable” includes the following items:

52

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Tax and employee payables
VAT payable to the Treasury

2022

2021

7,616

6,813

471

343

Other government entities (Consortium, Tax on premiums ...)

1,678

1,798

Payables to Social Security system

5,467

4,672

Other accounts payable to Group companies and associates (Note 18.1)

49,31541,314

Rest of payables

72,68073,83328,59228,807

1,789

1,340

Recoveries pending application

22,54424,301

Staff compensation payable

19,755

19,385

129,611

121,960

Sundry creditors
Payables for services

Total

Recoveries pending application year-end are recoveries obtained in the claims management process which, thoughalready allocated to specific claims, are pending inclusion in the settlement process.
Information on deferral of payments to suppliers
Below is the information required by Final Provision Two of Law 31/2014 of 3 December 2014 amending the recast textof the Spanish Companies Act (Ley de Sociedades de Capital) for the improvement of corporate governance and Law
15/2010 of 5 July 2010 amending Law 3/2004 of 29 December 2004. That information was prepared by the Directorsof the Company pursuant to the Resolution of the Spanish Institute of Accounting and Auditing (Instituto de Contabilidad
y Auditoría de Cuentas) of 29 January 2016. This information is limited to the operations of the ACyC branch in Spain.

2022

2021

Days

Days

Average period of payment to suppliers

26.00

18.60

Ratio of paid operations

26.66

18.69

Ratio of pending operations

7.70

16.48

AmountAmountTotal payments (Thousands of Euros)

31,667

37,465

Total payments made within established standard terms

19,45730,90961%

83%

Total pending payments (Thousands of Euros)

1,144

1,543

Total number of invoices paid

5.26

5.09

Total number of invoices paid within established standard terms

3.70

4.50

% invoices paid within established standard terms/total invoices paid

70%

88%

Total payments made within established standard terms / total payments

According to the ICAC Resolution, the average supplier payment period has been calculated taking into account tradetransactions involving the delivery of goods or provision of services accruing since the effective date of Law 31/2014 of
3 December 2014.
Solely for the purposes of the disclosure provided for in that Resolution, suppliers are considered to be commercial
creditors for debts with suppliers of goods or services, included in the item "Debts and payables other liabilities – Other
accounts payable – Rest of accounts payable" under current liabilities on the balance sheet.
“Average payment period to suppliers” means the time period between delivery of the goods or performance of theservices by the supplier and actual payment of the transaction.

53

All amounts are in millions of Euros, unless otherwise stated

12 Tax matters
Years open for review and tax audits
At 31 December 2022, the Company remained open to tax audit for those years not yet time barred with respect to themain taxes that affect its operations. According to the applicable regulations, tax settlements cannot be considered final
until they have been audited by the competent authorities or until the legal limitation periods have lapsed.
With respect to the years not inspected, due to the different tax law interpretations of the Company's operations,contingent tax liabilities can arise that cannot be objectively quantified, although the Directors of the Company estimatethat if those liabilities were to materialise, they would not have a material effect on these financial statements.
Reconciliation of accounting profit/(loss) and taxable income
The reconciliation between account income and the corporate income tax base for 2022 and 2021 for operations subject
to tax in Spain is shown below:

2022

Increases

Decreases

-

-

1,388

(301,503)(300,115)-(301,476)(301,476)

1,381

(27)

1,354

Reinvestment extraordinary profits

7

-

7

Impairment of foreign investments

-

-

-

Reported profit/(loss) before tax
Permanent differences
Reported profit/(loss) before tax ACYC and foreign entities
Non-deductible expenses

Dividends received

Total
290,461---

Temporary differences

203,427(175,701)

27,727

Originating in the year

203,427-

203,427

203,427-

203,427

-

-

-

-

(175,701)(175,701)

204,815(175,701)(477,203)(175,701)
18,073

Accounting allocations to non-deductible provisions
Allocation to Equalization Reserve (art.12.3 Spanish CIT Law)
Originating in previous years
Accounting allocations to non-deductible provisions in previous
years
Total

54

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2021

Increases

Decreases

-

-

1,609

(154,691)(153,082)-(135,691)(135,691)

1,602

-

1,602

Reinvestment extraordinary profits

7

-

7

Dividends received-(19,000)(19,000)

179,154
179,154(113,568)-

65,586
179,154

179,154-

179,154

Reported profit/(loss) before tax
Permanent differences
Reported profit/(loss) before tax ACYC and foreign entities
Non-deductible expenses

Temporary differences
Originating in the year
Accounting allocations to non-deductible provisions
Allocation to the Equalization Reserve (art.12.3 Spanish CIT Law)

197,083

-

-

-

-

(113,568)(113,568)-(113,568)(113,568)

180,763(268,259)

109,587

Originating in previous years
Accounting allocations to non-deductible provisions in previous
years
Total

Total

Reconciliation between accounting profit/(loss) and corporate income tax expense/ (rebate)
Shown below is the reconciliation between accounting profit and corporate income tax expense for 2022 and 2021:
2022

2021

290,461

197,083

Gross tax

71,77046,418Deductions

(593)

1,119

(3,644)

4,825

216

5,962

Impairment/reversal of deferred tax assets

(201)

(868)

Other adjustments

6,491

7,254

74,03964,711

Reported profit/(loss) before tax

Adjustment for prior years' tax expense
Adjustment for change of tax rate

Total tax expenses recognised in profit and loss statement

The amounts in the following tabs for deferred tax assets and liabilities, are shown before the assets and liabilities
compensation calculated at fiscal jurisdiction level.
Deferred tax assets
There follows a breakdown of deferred tax assets at year-end 2022 and 2021:

55

All amounts are in millions of Euros, unless otherwise stated

2022

2021

Technical accounts

130,91376,782Foreign branches

37,40922,336

93,50454,445

20,277

31,669Foreign branches

17,422

27,426

Branches in Spain

2,855

4,243

Tax loss available for set-off

32,672

31,280Foreign branches
Tax effect of revaluation of available-for-sale investment portfolio

32,672

31,28022,524420

Foreign branches
Other items

22,524420

26,72829,814Foreign branches

25,172

27,755

Branches in Spain

1,556

2,059

Total deferred tax assets

233,114

169,965

Temporary differences (tax prepayments):

Branches in Spain
Increase in asset base on recording defined contribution pension commitments

The deferred tax assets mentioned above have been recognised on the accompanying balance sheets because the
Directors of the Company believe that the best estimate of the Company's future earnings, including certain tax planning
actions, make their recoverability probable.
ACyC has tax losses from previous years not recorded on the balance sheets at 31 December 2022 of EUR 25.9 million(2021: EUR 34.0 million), which are wholly in respect of foreign branches. The time limit for carrying forward those tax
losses are specified below:
Setoff of tax loss carryforwards

2022

2021

1 – 3 years-

230

4 – 9 years

-

1,262

Indefinite

25,92632,526

Total

25,92634,018Deferred tax liabilities
There follows a breakdown of deferred tax liabilities at year-end 2022 and 2021:

56

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2022

2021

Equalization Reserve

159,736

141,845

Foreign branches

99,55081,626

Temporary differences (deferred tax)

Branches in Spain

60,18560,21920,922

21,244Foreign branches

20,922

21,244

Technical accounts

38,364

12,847

Foreign branches

38,364

12,847

10,72527,241

Foreign branches

1,133

1,937

Branches in Spain

9,591

25,304

18,552

21,309Foreign branches

17,83020,619Branches in Spain

723

690

248,298

224,486

Increase in asset base on recording defined contribution pension commitments

Tax effect of revaluation of available-for-sale investment portfolio

Other items

Total deferred tax liabilities
Deductions

In its Corporate Income Tax declarations from 2004 to 2014, the Company took deductions for its spending on research,development and technological innovation in Spain of EUR 3.7 million in accordance with article 35 of the recast text of
the Spanish Corporate Income Tax Law approved by Royal Decree Law 4/2004 of 5 March 2004 (for tax periods
beginning as from 1 January 2015, the deduction for research and development and technological innovation isregulated under article 35 of the Law 27/2014, of 27 November 2014, on the Corporate Income Tax (the CIT Law)).
Current tax
Current tax assets primarily consist of prepayments of the local corporate income tax. Current tax liabilities primarily
consist of corporate income tax and other local taxes payable.
Tax consolidation treatment
Since 2016, some of the companies in the consolidated group with registered office in Spain are taxed, for Corporate
Income Tax purposes, on a tax consolidation basis under Chapter VI of Title VII of the CIT Law that applies nationally in
Spain.
Atradius Crédito y Caución S.A. de Seguros y Reaseguros is part of consolidated tax group number 173/01 that is headedby the company Grupo Catalana Occidente, S.A. The branches located outside Spain apply the different tax systems inforce in the different countries in which they operate or are established. They had an average effective tax rate of 27%
in 2022 (33% in 2021).

57

All amounts are in millions of Euros, unless otherwise stated

13 Income and expenses
13.1

Personnel expenses

Shown below is the breakdown of personnel expenses at year-end 2022 and 2021:
2022

2021

Wages and salaries

182,081

175,929

Employee benefits

116,103110,881

840

2,166

Employer's Social Security contributions

39,27337,826Long-term remuneration in defined-benefit systems

5,979

15,542Long-term remuneration in defined-contribution systems

15,96010,063

Other employee costs

54,05045,285

298,184

286,810

Indemnities

Total

The variation observed in long-term remuneration plans, decreasing the defined-benefit line and increasing thedefined-contribution line, is the result of a modification in some pension plans in the Netherlands, where a certain
amount of defined-benefit plans changed to a defined-contribution system.

13.2

Other expenses – Rest of Expenses

This line item of the non-technical profit and loss statement for 2022 mainly records the allocation to the amortisationof goodwill of EUR 4.6 million (2021: EUR 4.6 million) and income from exchange and translation differences of EUR
10.6 million (2021: EUR 7.6 million of income).

13.3

Commissions and profit sharing on ceded reinsurance and retrocession

The line item “Commissions and profit sharing on ceded reinsurance and retrocession” of the technical account at yearend 2022 and 2021 records the accrual of commissions under the reinsurance contracts in effect at the respective yearends.

58

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

14 Provisions and contingencies
14.1

Obligations for pensions and similar obligations

The various commitments the Company had to staff as at 31 December 2022 are described in Note 4.11.
2022

2021

Pension Plans

51,93791,477

Other employee benefits

7,538

7,275

Total

59,47598,752

Defined benefit plans expose Atradius mainly to market investment risk, interest rate risk and inflationary risk:-a decline in asset market value (equity, real estate, alternatives, etc.) will immediately increase the balance sheet
liability and the near-term cash flows for countries where there is minimum funding requirements;a decrease in corporate bond yields will result in an increase in plan liabilities even if this effect will be partially
offset by an increase in the value of the plans’ bonds; andan increase in inflation rate will result in higher plan liabilities thus, an increase in future employer contributions incountries where there is minimum funding requirements.

The main defined benefit plans remaining at 31 December 2022 are in the United Kingdom and Germany andrespectively represent 83.0% (2021: 85.0%) of pension plan assets and 79.3% (2021: 80.5%) of the liabilities for defined
benefits recorded under liabilities on the balance sheet. The rest of the plans are in respect of Spain, Italy, Switzerland,
Sweden, Belgium, Norway and France. The defined benefit liabilities under those plans range between EUR 1.6 million
and EUR 10.2 million (2021: EUR 2 million – EUR 10 million) and the number of participants enrolled between 13 and451 people (2021: between 13 and 451).
The Company also has defined contribution plans. The contributions to these pension plans are recognised as an
expense in the accompanying technical profit and loss statements and amounted to EUR 16 million in 2022 (2021: EUR
10.1 million), highlighting those defined-benefit pension plans in the Netherlands, which changed to a definedcontribution system.

Pension assets and liabilities
Shown below are the changes recorded in the value of net pension liabilities:

59

All amounts are in millions of Euros, unless otherwise statedBalance at 1 January

Defined benefit
obligations

Fair value of assets

Techo del activo

Net defined benefit
liabilities (assets)

2022

2021

2022

2021

2022

2021

2022

2021 (*)

535,348

987,936443,871857,438--

91,477130,498

6,903

15,059

-

-

-

-

6,903

15,059

-

(228)

-

-

-

-

-

(228)

Profit and loss statement:
Cost of current services
Cost of past services –Modifications of the plans
Cost of past services – Recalculationof the commitments-(29,180)

-

-

-

-

-

(29,180)

Settlements-(429,992)-(459,172)---

29,180Net interest

8,147

10,941

9,010

10,833

-

-

(863)

108

4

661

-

-

-

-

4

661

15,054(432,739)

9,010(448,339)

-

-

6,044

15,600- actuarial assumptions(2,840)(9,228)

-

-

-

-

(2,840)(9,228)– financial assumptions

Administration costs
Total Profit and loss Statement

Recognised income and expense:
Measurements of losses (gains):
Actuarial gains and losses:(181,910)

7,277

-

-

-

-

(181,910)

7,277– adjustments for experience

7,278(17,120)

-

-

-

-

7,278

(17,120)

Return on the plan asset, notincluding interest income--(141,061)

20,602--141,061(20,602)

Change in unrecoverable surplus
other than interest

-

-

-

-

(60)

-

-

-

(19,071) (141,061)

20,602(60)-(36,411)(39,673)

Total recognised income andexpenses(177,472)

Others:Contributions by employer
Contributions by employee(3,612)616(3,568)
1,965

2,995
616

41,928
1,965--(6,607)-(45,496)-

Benefits paid

(15,707)(21,162)(15,707)(21,162)

-

-

-

-

Effect of exchange rates(13,972)

21,987(18,379)

26,143

-

-

4,407

(4,156)

-

-

7,034

(34,704)--(7,034)34,704

Total Other(32,675)(778)(23,441)

14,170--(9,234)(14,948)

Balance 31 at December

340,255

535,348

288,379

443,871(60)-

51,876

91,477

Reclassification of plan surplus
assets(*) The opening balance includes the Netherlands pension plan (defined benefit obligations: EUR 452 million; fair value of plan assets EUR 420 million)

The present value of the remuneration referred to in the preceding table has been determined by qualified independentactuaries, who considered the following to quantify those items:-

60

Method of calculation: “Projected credit unit”, which considers each year of service as entitling one additional unitof rights to the benefits, with each unit being measured separately;
Actuarial assumptions used: unbiased and compatible with each other. The main assumptions used for making theactuarial valuations of the principal defined plans are shown in the following table:

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

The surplus of the pension plans amounts to EUR 81.3 million at 31 December 2022 (2021: EUR 88.4 million), recorded
in “Other assets – Assets and reimbursement rights for long-term staff remuneration”.
In Spain, the defined benefit plans are partly insured by Seguros Catalana Occidente, S.A. These insurance policies are
not considered qualified and, therefore, their value is considered as reimbursement rights, recorded as other assets inthe amount of EUR 6.3 million (2021: EUR 6.5 million).
The pension commitments with related entities at 31 December 2022 and 2021 are shown below:

2022

2021

Present value of the net obligations

2,716(2,367)

Fair value of the plan assets

6,260

6,503

Total

8,976

4,136

These amounts have been recorded in the item “Non-technical provisions – Provision for pensions and similar
obligations” and in “Other assets – Assets and reimbursement rights for long-term staff remuneration”, respectively, on
the accompanying balance sheets. The difference between the two amounts has been recorded under shareholder fundsof the Company.
The measurement of the fair value of the plan assets earmarked for the defined benefit commitments has been
performed considering the amount of the mathematical provisions reported by the insurers and the pension fundmanagement companies for those commitments, which have calculated those provisions according to their own
assumptions on interest rates and mortality tables. Those assumptions must conform to the specific insurance standards
in effect in each country at present. This gives rise to an accounting asymmetry between the assumptions used tomeasure assets and those employed to measure the obligations by the independent actuaries.

61

All amounts are in millions of Euros, unless otherwise stated

Characteristics of the main defined benefit plans
Characteristics
Entitlement

United Kingdom
Based on a percentage of final salary(closed to new employees).

Germany
Based on a percentage of the averagesalary of the last 10 years.

Number of participants

85 active members (2021: 101 active
members).
547 inactive members (2021: 539 inactive
members).

424 active members (2021: 432 active
members).
378 inactive members (2021: 360 inactive
members).

Definedobligations

EUR 169 million (2021: EUR 299 million).

EUR 99.7 million (2021: EUR 136.6 million).

AssetsEUR 247 million (2021: EUR 387 million).

EUR 59.9 million (2021: EUR 70 million).
EUR 14.9 million of assets (2021: EUR 16.9
million) recognised as part of financial
investments.

Measurement of gain
(loss) in income andexpenses not recognised

EUR 6.3 million – gain (2021: EUR 30.7
million – gain).

EUR 23.6 million – loss (2021: 0.5 million –loss).

Funding agreement

The basis of the funding agreement lies inthe trust agreement. The pension fundperforms triennial actuarial valuations todetermine employer contributions.

A trust agreement is established as afinancing vehicle to cover part of thepension liabilities. There is no specificfunding agreement although the assets
must exceed the initially funded amount of
EUR 30 million.

Employee contributions

In 2022 contributions amounted to 7,1% of
the salary (7,1% in (2021).

None; contributions are made by theemployer.

ALM strategy

The investment strategy consists of aliabilities management driven investment
portfolio in order to provide revenues thatmatch the retirement benefits, together
with interest rate and inflation hedges,
with the rate of inflation, so that the plancan be self-sufficient.

The investment objectives and policies aredeveloped based on an ALM study.

The UK pension plan is subject to UK
legislation and to the pension guidelines
issued by the UK pension regulator.

The German pension plan is subject toGerman legislation and to the pension
guidelines issued by Germany's pension
regulator.

benefitRegulatory Framework

62

The investment policy limits the interest
rate risk by restricting the investment inbonds to fixed rate bonds. Equity price risk
is controlled by investing according to the
Dow Jones Euro Stoxx 50 Index.

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Fair value of the pension assets
The fair value of pension plan assets at the end of the year is shown below:

Assets 2022

Cash and cash
Sharesequivalents

Bonds

Investment
funds

Insurance
contracts

Real estate Total

Belgium

-

-

-

-

25,203-25,203Germany(457)

22,54937,815---59,907

Norway

-

-

-

-

2,734

-

2,734

Spain

-

-

-

-

13,126-

13,126

Sweden

-

347

1,522

481

-

-

2,350

Switzerland

-

-

-

-

4,510

-

4,510

United Kingdom

6,443

-

163,583

10,203--

180,229

Total

5,986

22,896

202,920

10,68445,573-

288,059

Investment
funds

Insurance
contracts

Assets 2021

Cash and cash
Sharesequivalents

Bonds

Real estate Total

Belgium

-

-

-

-

33,576-33,576

Germany(391)

25,71644,653---69,978

Norway

-

-

-

-

2,899

-

2,899

Spain

-

-

-

-

13,160-13,160Sweden

-

366

1,604

507

-

338

2,815

Switzerland

-

-

-

-

4,001

-

4,001

United Kingdom

3,766

-

299,052

14,624--317,442

Total

3,375

26,082

345,309

15,131

53,636338

443,871

The investments held by the pension plans in equities and fixed-income securities are quoted on active markets. The
plan assets include no financial instruments owned by ACyC or any real estate occupied by the Company or assets usedby the Company.
The expected rates of return on the assets of the pension plans are calculated by multiplying the fair value of the plan
assets by the discount rate determined at the start of the year taking into account the changes in the plan assets during
the period as a result of the contribution and benefits payments. The current return on the plan assets (including
reimbursement rights) amounted to EUR 132.3 million – gains (2021: EUR 30.2 million).
In 2023 ACyC expects to contribute approximately EUR 2.8 million to defined benefit plans.

63All amounts are in millions of Euros, unless otherwise stated

Actuarial assumptions
The principal assumptions used for the purpose of the actuarial valuations of the two main defined benefit plans arepresented in the following table:
Principal actuarial assumptions

United Kingdom
2022

Germany

2021

2022

2021

Discount rate

5.00%

2.00%

3.75%

1.00%

Inflation rate

3.50%

3.50%

2.50%

2.00%

Expected increase of future salaries

3.25%

3.25%

3.05%

2.55%

Expected increase of future benefits
Mortality table

3.36%
CMI 2021(1.25%LTR)

3.36%
CMI 2020(1.25%
LTR)

2.25%
Heubeck
Richttafeln
2018 G

1.75%
Heubeck
Richttafeln
2018 G

15

19

13

16

Duration in years

An approximation of the sensitivity of the key actuarial assumptions, holding other assumptions constant, would impact
the total defined benefit obligation of the main pension plans by the amounts shown below:
Defined benefit obligations

2021 (*)

2022
Increase

Decrease

Increase

Decrease

Discount rate (1% movement)(35,441)

44,356(73,210)95,563

Inflation rate (1% movement)

36,944(33,255)

75,236(64,217)

Future salary growth (1% movement)

6,791(6,085)

13,478(12,028)

Future pension growth (1% movement)

32,461(27,317)65,90354,149

9,111

n/a

20,631n/a

Future mortality (+1 year)(*) For purposes of comparability of the sensitivity analysis, the comparative values for ##D<FYPrior> do not include the Netherlands pension plan settled in ##D<FYCurr>, so these figures are not the same as
those presented in the ##D<FYPrior> Annual Report.

Expenses for personnel commitments
EUR 6.3 (2021: EUR 15.2 million) was recorded as pension expense in the technical profit and loss statements under“Administration costs”. Of this amount EUR 6.3 million (2021: EUR 15.2 million) was in respect of pension plans and
EUR: 0.2 million (2021: EUR 0.2 million) of other long-term commitments.

14.2

Other non-technical provisions

Shown below is the breakdown of other non-technical provisions:64Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2022
Balances at 1 January

Retirements

Litigation

Total

1,584

925

2,509

Allocation

-

60

60

Application(1,584)(10)(1,594)

Effect of changes in foreign exchange rates

-

-

-

Balances at 31 December

-

975

975

Retirements

Litigation

Total

1,782

886

2,668

Allocation

-

112

112

Application

(198)

(73)

(271)

2021
Balances at 1 January

Effect of changes in foreign exchange rates
Balances at 31 December

-

-

-

1,584

925

2,509

Litigation
The litigation provisioning is in respect of disputes with third parties that do not involve the Company's insurance
business. The provisions for the insurance underwriting business are included in the Technical provision for claims.
The provision reflects the estimated cost of legal proceedings unrelated to the insurance underwriting business. These
provisions have not been discounted to their present value as the effect of the discounting is not material.

14.3

Contingencies

There are no contingencies at year-end 2022 and 2021.

65

All amounts are in millions of Euros, unless otherwise stated

15 Segment Reporting
The Company carries out transactions globally through an extensive network of branches. The regional distribution of
the direct insurance, accepted reinsurance and ceded reinsurance business areas in 2022 and 2021, was as follows:66Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2022
Spain andPortugalTransactions reported in:Rest ofRest of theEurope (1)World (2)372,8311,254,230

133,9121,760,973

Inward reinsurance premiums-

21,959102,493

124,452

Ceded reinsurance premiums(149,620)(514,023)(103,805)(767,448)

Total premiums

223,211762,165

132,600

1,117,976

86,514533,21373,987693,715

Provisioning for the year, accepted insurance

-

335

7,673

8,008

Provisioning for the year, ceded reinsurance(29,089)(212,292)(31,048)(272,430)

Total

57,425321,256

50,612429,293415,280595,295

51,177

1,061,752

Provisioning for the year, accepted insurance

182

7,340

169,414

176,937

Provisioning for the year, ceded reinsurance(200,925)(505,954)

90,348(616,532)

Total

214,537

96,681

310,939622,157

271,962

417,937

361,551

1,051,450

Total

Net premiums
Direct insurance premiums

Technical provisions
Provision for sms and for unexpired risks
Provisioning for the year, direct insurance

Claims provision
Provisioning for the year, direct insurance

Total provisions net of reinsurance
2021

Transactions reported in:
Spain andPortugalRest ofEurope (1)Rest of theWorld (2)

Total

345,838

1,112,097

92,2571,550,192-

14,67380,89895,571

Outward reinsurance premiums(233,178)(668,569)(87,318)(989,065)

Total premiums

112,660

458,201

85,837

656,697

80,864

495,71756,028632,609

Provisioning for the year, accepted insurance

-

508

8,613

9,121

Provisioning for the year, ceded reinsurance(36,498)(232,151)(31,768)(300,417)

Total

44,366

264,074

32,873341,313

381,993

411,465

27,109820,567

Provisioning for the year, accepted insurance

260

4,108

134,962

139,330

Provisioning for the year, ceded reinsurance(197,806)(366,415)(79,900)(644,121)

Total

184,447

49,15882,171

315,776

228,813313,232

115,044657,089

Net premiums
Direct insurance premiums
Inward reinsurance premiums

Technical provisions
Provision for unearned premiums and for unexpired
risks
Provisioning for the year, direct insurance

Claims Provision
Provisioning for the year, direct insurance

Total provisions net of reinsurance(1)

Mainly in Belgium, Netherlands, Germany and United Kingdom(2)Mainly in Hong Kong and Australia

67

All amounts are in millions of Euros, unless otherwise stated

16 Technical information
16.1

Technical provisions

The movements recorded in technical provisions during 2022 and 2021 is as follows:
2022
Balance at 1
January

Allocations

Applications

Balance at
31
DecemberDirect Business and Accepted Reinsurance
Provision for unearned premiums and for unexpired risks

641,731701,723(641,731)

701,723

Claims provision959,898

1,238,688(959,898)

1,238,688

Provision for profit sharing and for return premiums

36,13564,114(36,135)

64,114

1,637,764

2,004,525(1,637,764)

2,004,525(300,417)(272,430)

300,417(272,430)(644,122)(944,539)(616,532)(888,962)

644,122944,539(616,532)(888,962)

Balance at 1
January

Allocations

Applications

Balance at
31
December

Provision for unearned premiums and for unexpired risks

575,076

641,731(575,076)

641,731

Claims provision864,393

959,898(864,393)

959,898

81,491

36,135(81,491)

36,135

1,520,960

1,637,764(1,520,960)

1,637,764

Provision for unearned premiums and for unexpired risks(375,201)(300,417)

375,201(300,417)

Claims provision(647,268)(644,122)

647,268(644,122)

Other technical provisions(59,430)-

59,430-(1,081,899)(944,539)

1,081,899(944,539)

Total

Reinsurance share on technical provisions
Provision for unearned premiums and for unexpired risks
Claims provision
Total

2021

Direct Business and Accepted Reinsurance

Provision for profit sharing and for return premiums
Total

Reinsurance share on technical provisions

Total

The movements in estimated recoveries of the technical claims provisions recorded under assets on the balance sheetsat 31 December 2022 and 2021 in the line item “Loans and receivables – Other Receivables – Rest of Receivables” (seeNote 10), which are in respect of the Spain and Portugal business, are shown below:

68Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2022

Balance at 1
January 2021

Allocations

Applications

Balance at 31
December
2021

65,816(38,505)

69,293(31,390)(65,816)
38,50569,293(31,390)

27,31137,903(27,311)37,90383,084(47,668)

65,816(38,505)(83,084)
47,66869,293(31,390)

35,41627,311(35,416)

37,903

Estimated Recoveries
Estimated Recoveries Direct insurance
Estimated Recoveries Ceded insurance
Total
2021
Estimated Recoveries
Estimated Recoveries Direct insurance
Estimated Recoveries Ceded insurance
Total

The change in the estimated recoveries is recorded in the technical profit and loss statement in the line item “Variationin the provision for claims” both in the direct insurance and in the ceded reinsurance business.

16.2

Risk exposure and management

Operational risk management
Operational risks are the risks of direct or indirect loss from inadequate or failed internal processes, people, and systems
or external events. This definition is in line with industry practice as well as with the Solvency II Directive. This risk isthus present in all activities carried on by Atradius, at all levels and in all locations. At the same time as classifying
operational risk into processes, people, systems, and external events, Atradius also labels the its risks according toEnvironmental, Social & Governance (ESG) categories.
The Operational Risk Management (ORM) unit is part of the ACyC Risk Management department and is responsible fordeveloping methods for identifying, assessing and responding to risks and for monitoring and further enhancing theoverall risk management and control framework. The ORM unit works closely with both Internal Audit and the Legaland Compliance unit. At the highest level, operational risk is supervised by the Operational Risk Committee, which has
a reporting line through to the Chief Risk Officer.
The ORC unit uses a framework for the management of operational risk, which is based on the Committee of Sponsoring
Organisations’ Enterprise Risk Management (COSO ERM) Integrated Framework. Identification and monitoring
activities are developed and enhanced on an ongoing basis and include the maintenance of risk registers, facilitation ofrisk and control self-assessments, capture of risk indicators and incidents and testing and review of business continuity
plans. Risks and risk responses are discussed at all levels, locations and units across the business, including theManagement Board and Supervisory Board of Atradius N.V. High-level information on crystallised risks has been
captured for many years, with separate records of information technology risk events stretching back even further. To
provide oversight and assurance in an auditable and efficient manner, the ORC unit employs a dedicated governance,risk and compliance software platform (the ’GRC Portal‘) that integrates existing risk management activities across thebusiness.
In respect of external fraud, the Fraud Control Group, composed of employees across over 30 locations, monitors theactivity of customers and buyers to detect indications of fraud. This monitoring includes using bespoke software tocapture indicators of fraud from wide-ranging internal and external sources. Atradius also provides fraud awarenesstraining and advice to employees and customers to help identify fraudulent buyers. Internal fraud is addressed throughmanual and automated operational controls such as the segregation of duties, application of signing authorities androle-based system privileges and authorities.
More details on certain operational risk management activities are provided below.

69

All amounts are in millions of Euros, unless otherwise stated

Risk registers and risk /control self-assessments
While the ORC unit is responsible for facilitating operational risk management within ACyC, the lines of business andfunctional areas are responsible for managing their operational risks. Atradius Leadership Team members, assisted by‘risk champions’, maintain risk registers for their respective units. The content of registers provides input to local
management meetings and is also reviewed by the Operational Risk Committee and during meetings of the Executive
Committee of ACyC. This ensures that operational risks are considered from all management perspectives.
While risk registers use a top-down approach to capturing risks, Atradius also uses a bottom-up approach of control
self-assessments to review existing risks and associated controls and identify any control weaknesses inherent inbusiness processes.
On a quarterly basis, ACyC conducts specific assessments of processes and controls covering financial reporting risks,
including reporting for Solvency II purposes; the resulting ‘in control’ sign-off process is overseen by a committee withrepresentatives from Group Risk Management, Finance and Internal Audit.
Business continuity management
ACyC recognises the importance of being able to recover its critical business processes in the event of any major
operational disruption. Business continuity management at ACyC is based on the International Standard ISO22301. The
ORM unit coordinates the documentation, maintenance and continuous testing of practical plans for recovering key
business activities within acceptable timeframes.
Regulatory compliance
At Atradius we believe that complying with all applicable laws, rules and regulations and maintaining high standardsof ethics and integrity serves to lessen operational risk and achieve more stable commercial processes. The Atradius
Code of Conduct outlines the basic corporate, legal and ethical compliance principles and guidelines that apply to all our
employees and that govern Atradius' commercial conduct toward its customers, brokers and all parties involved in ourbusiness.
Atradius has set up several additional compliance policies for more specific areas which set out the requirements that
Atradius’ employees must adhere to. For example, the Policy on Customer Due Diligence and Policy on Sanctions
address potential sanctions risks establishing operational and control procedures to comply with sanctions laws andregulations. Atradius also has a Data Protection Framework in place, which includes controls, policies and procedures
to comply with the applicable data protection legislation. All the compliance policies are available to employees an are
reviewed on a regular basis.
The Compliance Function supports the management of Atradius in meeting its objective of being compliant withapplicable laws, rules and external and internal regulations. The Group Compliance Function is responsible for the
maintenance and overall effectiveness of the compliance framework at Group level and, the Local Compliance Function
monitors regulatory and compliance developments at local country level.
Russia – Ukraine War
The large number of sanctions restrictions relating to Russia and Belarus imposed by authorities in the EU, the UK and
the US, among others, have been closely reviewed by the organization to analyse their impact on the business. In linewith its sanctions compliance programme, Atradius reviews the potential exposure of business counterparties and otherentities to sanctions in close coordination between the Group Legal & Compliance, Risk Services and Commercial teams,
based both on its regular screening tools as well as on ad hoc review initiatives. In the context of this situation, theorganization has relied on a number of measures to closely monitor the impact of the updated sanctions regimes,
including the daily screening of its main databases against certain tools coordinated by a central compliance team, theestablishment of a task force with representatives from various departments to align the strategy and measures
adopted, and the introduction of certain additional checks to enhance the monitoring capabilities.

70Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Management of environmental risk
The higher frequency and severity of extreme weather events is harming infrastructure and disrupting supply chains.
The transition to a low-carbon economy is bringing about new policies, regulations and changes in market dynamics.
There is a risk of these changes having a negative impact in ACyC by affecting our operations and/or our customers andtheir buyers. The focus on reducing their carbon footprint and CO2 emissions can require manufacturers to adapt orclose, which can have a domino effect on their suppliers. Doing business in certain commercial sectors can become
undesirable and draw negative publicity. At the same time, the interest in climate change and ethical practices, and ESG
and Corporate Social Responsibility (CSR) considerations can create opportunities for improving the Company's
offerings. These developments are being tracked and discussed in various forums within the Company.

16.3

Information on the non-life insurance businessTechnical revenues and expenses by insurance line

CreditBonding

2022

2021

2022

2021

1,688,616

1,457,633

129,114

119,856

1,756,872

1,508,502

128,553

136,287(63,280)(4,976)(47,985)(2,884)644(83)(16,429)(2)

Reinsurance premiums (Cession and Retrocession)
Earned premiums net of cancellations and return
premiums(728,754)(995,958)(66,285)(70,271)(714,354)(919,082)(53,093)(69,983)+/- Change in provision for unearned premiums(14,400)(76,876)(13,192)(287)

Total of premiums attributed net of reinsurance

959,862

461,675

62,82949,585Premiums attributed (Direct and Accepted)
Earned premiums net of cancellations and return
premiums+/- Change in provision for unearned premiums+/- Change in provision for uncollected premiums

Claims (Direct and Accepted)(685,073)(376,811)(38,904)(41,014)Claims and expenses attributable to claims(407,548)(285,673)(40,848)(32,984)+/- Change in claims technical provisions(277,525)(91,138)

1,944(8,030)182,778

180,816

19,28323,373Claims and expenses paid

198,815

185,981

23,36821,147+/- Change in claims technical provisions(16,037)(5,165)(4,085)

2,226

Total claims net of reinsurance+/- Change in other technical provisions net ofreinsurance(502,295)(195,995)(19,621)(17,641)(27,959)(20,991)

(13)

(10)

Acquisition costs (Direct and Accepted)(215,419)(181,085)(9,886)(8,703)Administration costs (Direct and Accepted)(338,013)(343,166)(38,753)(45,628)

Claims (Cession and Retrocession)

Other technical expenses (Direct and Accepted)
Comissions and profit sharing on ceded reinsurance andretrocession

(215)

(381)

(10)

(17)

293,180

374,592

29,56331,539Other technical income

53,00549,043

4,779

4,905

(235,421)(121,987)(14,320)(17,913)

Total operating expenses and other technical expenses
(net)

71

All amounts are in millions of Euros, unless otherwise statedTechnical result by year of occurrence

CreditBonding

2022

2021

Premiums attributed (Direct and accepted)
Earned premiums net of cancellations and return
premiums

1,189,416

1,075,398

38,717

33,841

1,613,632

1,441,199

103,206

103,011+/- Change in provision for unearned premiums(314,015)(266,877)(64,330)(69,069)+/- Change in provision for uncollected premiums+/- Change in provision for bonuses and return
premiums(10,498)(7,813)

(100)

(56)

(99,704)(91,111)

(58)

(45)

Time allocated reinsurance premiums
Earned premiums net of cancellations and return
premiums(502,649)(734,802)(14,907)(16,104)(609,425)(845,312)(39,755)(50,123)+/- Change in provision for unearned premiums

106,776

110,510

24,84834,019Total premiums acquired net of reinsurance

686,766

340,596

23,81017,737

Claims (Direct and Accepted)(909,713)(617,815)(18,095)(22,450)

Claims and expenses attributable to claims(170,058)(67,803)

(666)

(282)

Technical provision for claims paid on claims occurred
during the year

(739,656)(550,011)(17,429)(22,168)

336,949

360,322

6,681

10,767

Claims and expenses attributable to claims

60,90753,801260

189

Technical provision for claims paid on claims occurred
during the year

276,042

306,521

6,421

10,578

Total claims net of reinsurance(572,764)(257,493)(11,414)(11,683)

Acquisition costs (Directo)(149,822)(132,334)(2,866)(2,452)Administration costs (Direct)(264,306)(283,409)(8,603)(8,918)

-

-

-

-

Reinsurance claims (Ceded)

Other technical expenses (Direct)
Comissions and profit sharing on ceded reinsurance andretrocession (Ceded)

2022

2021

172,151

268,062

5,608

6,621

Technical finance income net of expenses of same
nature

9,901

9,901

(268)

(268)

Other technical income

51,75848,494

3,268

3,172

Technical result by year of occurrence(66,316)(6,183)

9,533

4,207

The information presented in the preceding table includes data for the 2022 underwriting year, with underwriting year
understood to mean the risk underwritten in that year (2022).
Using data for the year of occurrence would not produce significant differences.
The line item “Other technical income” of the technical profit and loss statement records, among other items, EUR 49.7
million in 2022 (2021: EUR 46.1 million) invoiced in respect of studying and re-studying customers in relation to thepurchase of insurance and subsequent development. The expenses associated with that activity are recorded as“Administration costs” of the Company.

72

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

17 Capital and reserves and equity
The movement in the Company's shareholder fund during 2022 and 2021 is presented in the accompanying statementsof changes in total equity.

17.1

Share capital

Under the applicable laws, insurance companies operating in the credit and bonding insurance lines must havesubscribed share capital of not less than EUR 9,015,181.57.
The share capital of Atradius Crédito y Caución S.A. de Seguros y Reaseguros at 31 December 2022 and 2021 wasrepresented by 4,138,065 registered shares, each with a nominal value of EUR 6.01, fully subscribed and paid in andcarrying identical financial, voting and other rights. There are no restrictions on the transferability of the shares. The
Company's shares are not traded on the stock market.

17.2

Legal reserve

According to the recast text of the Spanish Companies Act (Ley de Sociedades de Capital), 10% of profit for the year mustbe allocated to the legal reserve until the balance of this reserve reaches at least 20% of share capital. Until that thresholdis reached, the legal reserve may only be used to offset losses, if there are no other sufficient reserves available for that
purpose. At year-end 2022, the reserve was fully established in the amount of EUR 5.0 million (2021: EUR 5.0 million).

17.3

Bylaws reserves

At year-end 2022, the Company had a reserve set aside in accordance with a previously existing bylaws obligation toallocate 5% of profit to a voluntary reserve until it reached 50% of the share capital. That reserve amounts to EUR 12.4
million (2021: EUR 12.4 million).

17.4

Voluntary reserves

At 31 December 2022, the balance of these reserves was freely disposable.
In 2022, as resolved by the Shareholders in General Meeting, no dividend was distributed (2021: no dividend was
distributed).
The balance of these reserves at year-end 2022 is EUR 608.7 million (2021: EUR 477.9 million).

17.5

Revaluation reserve

With this reserve the Company recognises differences in the value of certain assets, as provided in Royal Decrees 7/1996
of 7 June 1996 and Royal Decree 2607/1996 of 20 December 1996.
The amount of this reserve is the difference between the quantities obtained by applying the revision percentages
stipulated in Royal Decree 2607/1996 to the Company's property, plant and equipment and their depreciation charges,
and their value before the revision. The reserve is presented net of the associated single charge of 3%.
The revisions were inspected for tax purposes and gave way to no incidents for the Company.
The balance of these reserves at year-end 2022 is EUR 5.6 million (2021: EUR 5.6 million).

17.6

Equalization reserve

According to the PCEA, the equalization reserve is recognised in the Company's equity. At year-end 2022, it totaled EUR
800.5 million (2021: EUR 630.5 million).
During 2022, the Company allocated EUR 167.7 million in the credit insurance line and EUR 2.7 million in the bonding
insurance line, as required by the ROSSP. During 2021, the Company set aside EUR 1.6 million in the bonding line.
During the year there were applications of the reserve, given the positive operating technical result.

73

All amounts are in millions of Euros, unless otherwise stated

17.7

Share premium

The Recast Text of the Spanish Companies Act permits the use of the share premium account balance to increase capitaland places no specific restrictions on its disposability.

17.8

Other shareholder contributions

No contribution from the Shareholders was registered in 2022.
The cancellation of the ACyC intra-group reinsurance cession to Atradius Reinsurance DAC for the 2022 underwriting
year led to an increase in the ACyC self-retention. To offset this effect in part, at year-end 2021 the ACyC Shareholders
contributed funds of 60 million euros to ACyC in order to strengthen ACyC's equity after the end of the cession to
Atradius Reinsurance DAC.

17.9

Reserve for actuarial gains and losses

During 2022, the Company recognised a gain of EUR 25 million in reserves for actuarial gains and losses (2021: EUR
117.0 millions). All of them come from the impact of the annual measurement of the Company's defined benefit pension
plans (2021: EUR 30.8 million).

18 Transactions and balances with related parties
18.1

Balances with related parties

The breakdown of balances with related parties at 31 December 2022 and 2021 is as follows:

2022
AssetsInvestments
Receivables(Note 10)
ReinsuranceLong-term
staff
remuneration
Total Assets
Liabilities
Security
deposits
received
Debts andother accounts
payable (Note11)
Reinsurance
payablesGroup tax
payablesTotal
Liabilities

74

Atradius
NV

Atradius Collections
Atradius
Atradius
Subsidiaries
Insurance
Holding
Reinsurance
Informationof ACyC (1)Holding NV
B.V.
DAC
Services

Grupo
Catalana
Occidente

Others
(2)

Total

(3)

-

-

-

24,440

-

-

76

-

24,51660,211

571

4,981

594

75

25,136

223

3,782

95,573----37,753--447

38,200

-

-

-

-

-

-

6,464

-

6,464

60,211

571

4,981

25,03437,82825,136

6,764

4,229

164,754

-

-

-

-

1,778

-

-

-

1,778

10,404

-

1,591

1,917

-

35,339-64

49,315----

13,571

-

195

1,705

15,471

-

-

-

-

-

-

-

-

-

10,404

-

1,591

1,917

15,34935,339195

1,769

66,564

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

2021
AssetsInvestments
Receivables(Note 10)
ReinsuranceLong-term staff
remuneration
Total Assets
Liabilities
Security
deposits
received
Debts and otheraccounts
payable (Note11)
Reinsurance
payablesGroup tax
payablesTotal Liabilities

Grupo
Atradius
Atradius
Atradius
Collections
Catalana
Atradius Insurance
Subsidiarie
Reinsuranc Informatio
Holding
Occidente
NV
Holdings of ACyC (1)e DACn Services
B.V.
(3)
NV

Others
(2)

Total

-

-

7,436

16,475

-

-

76

-

16,551

26,898

794

-

192

75

20,804-

4,788

60,987----

38,838--(1,152)

37,687

-

-

7,436

-

-

-

6,707

-

6,707

26,898794-

16,66738,91320,804

6,783

3,636

121,932

-

-

1,339

-

2,374

-

-

-

2,374

12,821

-

-

1,756

-

25,287-

112

41,314----

41,535

-

-

1,753

43,288

-

-

1,339

-

-

-

11,895-

11,895

12,821

-

-

1,756

43,90911,895

11,895

1,864

98,871(1) –ACyC – Includes transactions with Iberinform, Invercyca, Iberinmobiliaria, Crédito y Caución de Seguradora de Crédito e Garantías and Crédito y Caución do Brasil Gestao de Riscos deCrédito e Servicios LTDA
(2) – Others – Includes transactions with DSB NV, Mexico, ATCI Inc., Atradius Rus and Atradius Italia Intermediazioni S.r.l.
(3) – Grupo Catalana Occidente – Includes transactions with Grupo Catalana Occidente S.A., Seguros Catalana Occidente, Sociedad Anónima de Seguros y Reinsurance, Grupo Catalana Occidente
Gestión de Activos S.A., S.G.I.I.C. and Grupo Catalana Occidente Tecnología y Servicios, A.I.E.

We notice an increase of the balance sheet position, at the receivables line of the balances with related parties, as there
was no settlement in 2022 of the 2021 position with the 2022 transfer pricing charges.

18.2

Related party transactions

The following table breaks down the transactions with related parties as at year-end 2022 and 2021 according to theircarrying value on the Company's books:

75

All amounts are in millions of Euros, unless otherwise stated2022

Atradius
Atradius
Atradius
Atradius Insurance Collections Subsidiaries
Reinsurance
Information
NV
Holding
Holding B.V. of ACyC (1)DACServicesNV

Grupo
Catalana
Occidente

Others

Total

(2)

(3)

Income statement
From premiums
ceded/accepted
From claims
ceded/accepted
From commission
on reinsurance
ceded/accepted
From services
provided andreceived
From financeincome and costs
Total

2021

-

-

-

1

(34,206)---(3,077)-(64,854)

-

-

-

-

-

30,339--(1,835)28,50428,581-

9,372(17,013)-7,585(3,805)(1,356)23,364

-

-

-

-

(2)

-

-

-

(2)

28,581-

6,295(17,012)(68,723)

7,585

Atradius
Collections
Atradius
Atradius Insurance
Subsidiaries
Holding
Reinsurance(1)
NV
Holdingof ACyC
B.V.
DAC
NV

79

4,403

(29,723)(112) (7,042) (75,084)(3,837) (5,831) (52,943)

Grupo
Atradius
Catalana
Information
Occidente
Services(3)

OthersTotal(2)

Income statement
From premiums
ceded/accepted
From claims
ceded/accepted
From commission
on reinsurance
ceded/accepted
From services
provided andreceived
From financeincome
Total

-

-

2,958

(61)

(154,627)

-

-

2,958

-

-

(70)

-

12,364

-

(78)

(70)

9,242

-

-

(2,094)

2

78,084-- (2,094)

75,992

31,627249(932)(17,033)-

7,707(5,587)(932)

25,476

-

-

-

-

(3)

-

-

-

(3)

31,627249(138)(17,092)(64,182)

7,707(5,665)(151,730)(138) (41,023)(1) – ACyC – Includes transactions with Iberinform, Invercyca, Iberinmobiliaria, Crédito y Caución de Seguradora de Crédito e Garantías and Crédito y Caución do Brasil Gestao de Riscos de Crédito eServicios LTDA
(2) – Others – Includes transactions with DSB NV, Mexico, ATCI Inc., Atradius Rus and Atradius Italia Intermediazioni S.r.l.
(3) – Grupo Catalana Occidente – Includes transactions with Grupo Catalana Occidente S.A., Seguros Catalana Occidente, Sociedad Anónima de Seguros y Reinsurance, Grupo Catalana Occidente
Gestión de Activos S.A., S.G.I.I.C. and Grupo Catalana Occidente Tecnología y Servicios, A.I.E.

In 2022 the Company paid no dividend to Grupo Catalana Occidente (in 2021 no dividend was paid).
In 2022 the Company received no dividend from related parties (in 2021 EUR 19 million dividends were received from
related parties).

76

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

18.3

Compensation of the Board of Directors and Senior Management

The Board of Directors received did not receive any remuneration as members of the Board, nor any for their pension
or life insurance obligations contracted on their behalf.
The following table provides details on the remuneration for members of the Executive Committee, which have assumed
senior management functions:
2022
2021
Short-term employee compensation (1)Long-term employee compensation
Post-employment benefits
Total remuneration

1,154
720
152
2,026

1,025
677
148
1,850

(1) Short-term employee compensation includes salaries, housing, Social Security, medical expenses, vehicle rental
and others.
An insurance policy has been contracted for senior managers to cover possible civil liability with a premium of EUR 0.2
million (2021: 0.2 million euros).

18.4

The duty of loyalty and duty to avoid situations of conflicts of interest of the Directors

The members of the Board of Directors have sent to the Company the communications relating to the duty of loyalty andto the duty to avoid situations of conflicts of interest, pursuant to articles 227 to 231 of the recast text of the Spanish
Companies Act, as amended by Spanish Law 31/2014 of 3 December 2014 for the improvement of corporate governancefor the year ended 31 December 2022.
In said communications, the members of the Board of Directors have stated that they have not been in any situation of
direct or indirect conflict of interest with the interest of the Company and that, according to the information that they
are aware of and that they have been able to obtain with the greatest due diligence, none of their related persons are insuch situation either. Lastly, in compliance with the aforementioned Law, they have indicated that they will promptly
report any change that may occur with regard to the detailed information.

77

All amounts are in millions of Euros, unless otherwise stated

19 Other information
19.1

Personnel

The average number of full-time employees of the Company and their distribution by job category during 2022 and2021 is as follows:
2022

2021

Management

87

87

Technical staff and middle managers

447

447

1,805

1,802

Others

230

230

Total

2,569

2,565

Administrative staff

The gender distribution of full-time employees of the Company at year-end 2022 and 2021 is shown below, breakdownby job category:
2022
2021
Men

Women

Men

Women

71

14

73

14

Technical staff and middle managers

305

138

308

139

Administrative staff

884

922

880

922

Others

51

184

50

180

Total

1,311

1,258

1,311

1,254

Management

The Board of Directors of the Company at 31 December 2022 was composed of 9 members (8 men and 1 woman). In
2021, the Board was composed of 9 members (8 men and 1 woman). No member of the Board of Directors has an
employment relationship with the Company.
During 2022, there were a total of 58 employees with a disability of 33% (2021: 57 employees).

19.2

Auditor fees

During 2022 and 2021, the fees for accounting audit services and other services performed by the Company's statutory
auditor, PricewaterhouseCoopers Auditores (PwC) or by any company related to the auditor by virtue of control, common
ownership or management were as follows:

2022

2021

Other firms in
the PwC
network

Other firms in
the PwC
network

Items

PwC

Audit services

1,388

1,078

2,466

796

867

1,663

342

-

342

392

69

461

Other verification services

6

7

13

-

7

7

Rest of other services

-

63

63

-

6

6

1,736

1,148

2,884

1,188

949

2,137

Other services required by the regulations

Total other professional services

78

Total

PwC

Total

Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

These figures are for the fees agree for audit services for 2022 and other services (including VAT and other expenses).
The amounts of audit services include services involving review of the Solvency II Directive and other regulatory
requirements. The sums reported for non-audit services are related to projects that required the involvement of thestatutory auditor according to the regulation applicable in each country.
The increase of audit fees in relation to fiscal year 2021 is driven by the audit work that is currently in progress in viewof the implementation of the IFRS 17 by Atradius N.V. and Grupo Catalana Occidente.

19.3

Customer Service Office

In compliance with the regulatory framework that applies in Spain, the Customer Service Department has prepared theprescribed Report on Complaints and Claims for 2022.
That report, which relates to the businesses in Spain, shows that five written submissions were received in the Customer
Service Department. All of them met the formal requirements, and consequently have been processed as claims.
Three claims, out of the five processed, were settled by agreement with the customer. In the other two left, the resolution
was entered rejecting the claim and ruling that the decisions made by the Company departments involved were lawful.
In each submission and in the resolution issued it was expressly stated that the Commission for the Defence of Insureds
and of Pension Plan Participants, of the DGSFP, is not authorised to hear the claims submitted as these involved
insurance contracts for major risks. The five claims handled were in respect of credit insurance policies.
In addition, it bears emphasis that comparing the number of claims processed with the customer who could potentiallysubmit claim gave a percentage of 0.01372% for the year ended 31 December 2022.
Given the small number of claims and their different underlying reasons, as well as the Company's experience, nogeneral guidelines have been set and no recommendations or suggestions were issued.

19.4

Information on the environment

Given the nature of the Company's business, it has no liabilities, expenses, assets or provisions and contingencies of anenvironmental nature that could be significant in relation to its equity, financial position and earnings. For this reason,no specific disclosures on these issues are included in these Notes.

19.5

Guarantees with third parties

At 31 December 2022 there were bank guarantees securing EUR 1.8 million in lease obligations of the Company and EUR
27 thousand in bonds in respect of legal proceedings against third parties.

20 Subsequent events
The Board of Directors proposes to the General Meeting that the result for the year be allocated to voluntary reserves.

79All amounts are in millions of Euros, unless otherwise stated

ANNEX. BREAKDOWN OF REAL ESTATE PROPERTIES AT 31 DECEMBER
2022(Figures in euros)

Location

Address

CountryYearofacquis Gross value
ition

2022
Accum.
Depreciation

Net value

Impairment

Last
Appraisal
Date

PROPERTIES FOR OWN USE
ALCALA DE H.

Comp.Inmob.Garena Plaza pl 9 B Spain

2005

1,031,468(285,911)

745,557

745,557

28-mar.-22

ALICANTE

C/ San Fernando , 19 Principal

Spain

2002

429,024(51,572)

377,453

377,453

24-mar.-22

BILBAO

Gran Vía, 17 2º Planta Of.1 y 3

Spain

2004

2,931,093(698,676)

2,232,417

2,232,417

29-abr.-22

CASTELLON

Ruíz Zorrilla, 1 5º

Spain

1999

414,097(118,297)

295,800

295,800

5-abr.-22

GERONA

Avda. Jaime I, 1

Spain

1990

335,248(175,093)

160,155

160,155

8-abr.-22

LA CORUÑA

Real, 85 6º

Spain

1975

495,743(360,072)

135,670

135,670

9-may.-22

LAS PALMAS

Plaza de España, 6

Spain

2020

365,013(9,947)355,066

355,066

7-sep.-21

LEON

Avda. Independencía, 2 3º

Spain

1974

36,998(27,763)

9,251

9,251

8-abr.-22

MADRIDPº de la Castellana, 4

Spain

1995

21,739,237(7,525,720)

14,213,516

14,213,516

28-mar.-22

MALAGA

Avda. Andalucia, 19 L-A2

Spain

1981

160,619(102,425)

58,19458,19422-abr.-22

MALAGA

Avda. Andalucia, 19 L-A5

Spain

1987

119,346(66,545)

52,80252,80222-abr.-22

MURCIA

Avda. Libertad, 2

Spain

1988

252,571(136,505)

116,066

116,066

18-mar.-22

MURCIA

Avda. Libertad, 2 Local C

Spain

2001

115,755(39,655)

76,10076,10018-mar.-22

OVIEDO

Conde de Toreno, 4

Spain

1967

134,614(107,691)

26,92326,92313-abr.-22

PAMPLONA

Avda. Carlos III, 13-15

Spain

1984

110,902(65,626)

45,27745,277

3-may.-22

SEVILLA

Plaza Nueva, 8 Dpdo. 5

Spain

1971

494,036(395,228)

98,80798,80724-mar.-22

SEVILLA

Plaza Nueva, 8

Garaj. 63

Spain

1971

6,842

(5,200)

1,642

1,642

24-mar.-22

SEVILLA

Plaza Nueva, 8

Garaj. 50

Spain

1973

6,540

(4,971)

1,569

1,569

24-mar.-22

TARRASA

Gutemberg, 3 3º F

Spain

1976

143,451(101,426)

42,02542,02528-mar.-22

VALENCIA

Avda. Jacinto Benavente,14

Spain

2004

2,284,661(482,370)

1,802,291

1,802,291

8-abr.-22

VALLADOLID

Duque de la Victoria, 4

Spain

1978

247,596(171,002)

76,594

76,5941-abr.-22

ZARAGOZA

Plaza Salamero, 14 3º A

Spain

1975

285,300(205,492)

79,80879,808

7-abr.-22

ZARAGOZA

Plaza Salamero, 14 Trasteros

Spain

1989

4,608

(3,223)

1,384

1,384

7-abr.-22

LISBOA

Av.C. Bordalo Pinheiro 75

Portugal

2017

3,970,100(317,227)

3,652,873

3,652,873

21-sep.-21

LISBOA

Avda. la Liberdade, 245

Portugal

2001

1,444,953(482,587)

962,366

962,366

29-jun.-22

OPORTO

Plaza Buen Suceso, 61

Portugal1905

977,169(315,355)

661,814661,81429-jun.-22

ROMA

Via Crescenzio

Italy

1972

15,823,758(3,102,694)

12,721,064

12,721,064

10-dic.-21

ROMA

Via Cassiodoro 9

Italy

1993

1,328,200(246,014)

1,082,186

1,082,186

10-dic.-21

55,688,942(15,604,287)

40,084,670(244,996)

Total Own-Use Real Estate80Annual accounts 2022 Atradius Crédito y Caución S.A. de Seguros y Reaseguros

Location

Address

Country

Year ofacquisition

Last
Appraisal
Date

2022

Gross value

Accum.
Depreciation

Net value

Impairment

PROPERTIES FOR OWN USE
ALBACETE

Tesifonte Gallego, 4

Spain

1982

59,865(37,241)

22,624

22,62410-mar.-22

ALMERIA

Lachambre, 2 2º

Spain

1996

102,998(44,175)

58,82458,82429-mar.-22

BADAJOZ

Avda. Ramon y Cajal, 13 1º

Spain

1992

64,119(31,028)

33,09133,09121-mar.-22

BARCELONA

Provenza, 216

Spain1965 7,847,107(2,024,469)

5,822,638

5,822,638

5-abr.-22

BILBAO

Gran Vía, 53

Spain

1967

146,093(116,874)

29,21929,21929-abr.-22

BURGOS

P. Alonso Martinez, 8

Spain

1987

80,510(44,653)

35,85735,85717-mar.-22

CORDOBA

Ronda de los Tejares, 32

Spain

1986

127,910(72,852)

55,05855,05821-mar.-22

GRANOLLERS

Avda. San Esteban, 9

Spain

1999

201,270(83,339)

117,931

117,93128-mar.-22

JAEN

P. Constitución, 10

Spain

1989

76,541(40,731)35,81035,81025-mar.-22

JEREZ

Cmte. Paz Varela, 21 2º L-8

Spain

1988

41,184(22,240)

18,944

18,94429-abr.-22

LA CORUÑA

Alameda, 34 5º C

Spain

1974

82,324(61,117)

21,207

21,207

6-may.-22

LERIDA

Avda. del Segre, 1

Spain

1990

109,392(56,172)

53,21953,21928-mar.-22

MADRID

Dulcinea, 47 Bajo L-1-2

Spain

1969

213,572(170,858)

42,71442,7145-abr.-22

P. MALLORCAPª del Borne, 15

Spain

1975

137,568(100,159)

37,41037,41022-mar.-22

S. C. TENERIFE

Villalba Hervas, 9 1º C

Spain

1987

190,727(105,666)

85,06285,062

9-jun.-22

SABADELL

Plaza de Cataluña,16

Spain

1997

222,201(88,838)

133,363

133,363

28-mar.-22

SANTANDER

Cuesta, 2 4º Dcha.

Spain

1985

132,231(76,678)

55,55355,55324-mar.-22

SEVILLA

Plaza Nueva, 8 Garaj. 61

Spain

1971

6,842

(5,201)

1,642

1,642

24-mar.-22

SEVILLA

Plaza Nueva, 8 Garajes

Spain

1973

32,699(24,853)

7,846

7,846

24-mar.-22

TARRAGONA

Rambla Nova, 76 1º 2

Spain

1976

110,509(79,131)

31,37831,37811-abr.-22

VIGO

Uruguay, 2 2º

Spain

1967

205,884(164,708)

41,176

41,17615-mar.-22

VITORIA

Manuel Iradier, 24 L-1

Spain

1986

71,875(40,709)

31,166

31,16618-mar.-22

ZARAGOZA

Plaza Salamero, 14 3º B

Spain

1975

116,558(83,915)

32,64432,6447-abr.-22

ZARAGOZA

Coso, 98-100 7º 6

Spain

1972

41,409(32,814)

8,595

8,595

1-abr.-22

LEON

Avda. Independencía, 2 3º

Spain

1974

38,462(28,816)

9,628

9,628

8-abr.-22

OVIEDO

Conde de Toreno, 4

Spain

1967

21,914(17,531)

4,383

4,383

13-abr.-22

GENOVAVia di Sottoripa 1/A

Italy

1991

249,333(65,900)

183,433

183,433

10-dic.-21

UDINE

Via Manzini 8-9

Italy

1992

184,416(54,318)

130,098

130,098

10-dic.-21

ROMA

Via Padre Semeria 29

Italy

1985

176,406(33,202)143,204

143,204

10-dic.-21

11,091,91(3,808,188)

7,283,717(92,949)

Total Leased Properties*** The "PROPERTIES FOR OWN USE" table does not include a fully depreciated property in Sweden acquired in 1993 for an acquisition price of 345,000
Swedish Krona (EUR 33,643).

81

Management Report82Management Report
CONTENTS
1

Economic Environment ...................................................................................................................................................................... 84

2

Financial Situation .............................................................................................................................................................................. 85

3Management of Risks, Financial Instruments and Capital ....................................................................................................... 86

4Group Companies................................................................................................................................................................................. 89

5

Other Information................................................................................................................................................................................90

6

Outlook for 2023 .................................................................................................................................................................................. 9383

1

Economic Environment

Geopolitical Risk presents a new threat to growth
Global economic growth slowed from 6.0% in 2021 to 3.0% in 2022. The COVID-19 pandemic continued to influence theworld economy, though less so than in 2021, as most markets emerged from their lockdowns after the first quarter of2022. A new threat came to the forefront when Russia invaded Ukraine in February 2022. The war has enormous
humanitarian and economic consequences for Ukraine, but also has important ramifications for global energy markets.
Energy shocks have pushed up inflation, weighing on consumers’ purchasing power and firms’ profitability.
Advanced markets
Across advanced markets, GDP growth slowed to 2.6% in 2022, following on a 5.3% expansion in 2021. High inflation
was the main culprit to growth in 2022. Inflation in advanced markets rose to an average 7.1% in 2022, mainly driven
by high energy prices, but also core inflation (excluding energy and food) was clearly above its historical average.
Supply chain bottlenecks, such as high shipping costs and semiconductor shortages, remained an issue in 2022. Many
governments kept supportive fiscal policies in 2022, resulting from pandemic-related support and support given
because of the energy crisis. Monetary policy, however, was tightened in many markets to combat high inflation.
The United States entered a technical recession in the first half of 2022. Despite this, economic activity remained
resilient in the third quarter of 2022 and the labour market remained strong throughout the year. Towards the end of2022, the US economy showed signs of weakening, with decelerating private consumption growth and softening jobs
data, a sign that tougher times are ahead. In response to high inflation, the US Federal Reserve began to shrink the sizeof its balance sheet and implemented several policy rate hikes in 2022.
The eurozone experienced a relatively strong first half of 2022. Economies emerged from their lockdowns after the firstquarter, giving a growth boost to the services sectors and to tourism. GDP growth weakened significantly, however, inthe second half of the year. This was mainly the result of high inflation, the reduction in consumers’ purchasing power
and the affection in the sentiment among both households and businesses. The European Central Bank, somewhat later
than the Federal Reserve, moved on a more restrictive monetary policy path. It implemented several rate hikes in 2022
and ended net asset purchases under the pandemic emergency purchase programme.
Emerging markets
Growth in emerging market economies (EMEs) slowed from 7.0% in 2021 to 3.5% in 2022. They were confronted withheadwinds from the COVID-19 pandemic as well as the fallout of the war between Russia and Ukraine. EMEs in 2022
faced tighter financial conditions as central banks in advanced markets raised interest rates in response to higher
inflation. Some of the more indebted EMEs struggled with higher financing costs and threats of debt instability.
Growth in Emerging Asia continued to moderate, though it remained the fastest growing region in 2022 (34%). In China,
economic activity slowed from 8.1% in 2021 to 2.7% in 2022. COVID outbreaks and mobility restrictions as part of thegovernment’s zero-COVID policy have pulled down economic activity. The Chinese real estate sector also experienced
troubles due to the declining housing market and the bankruptcy of several large property developers.
The economic recovery lost some steam in Latin America, with GDP growth slowing to 3.7%. Latin American economies
faced ongoing challenges (high inflation, monetary tightening), further aggravated by the economic repercussions
caused by the war in Ukraine. In Brazil, GDP expanded by 3.0% in 2022. Despite political uncertainty and tight monetary
policy, economic activity remained relatively resilient. Jobs growth and consumer spending supported growth in thefirst half of 2022. In Mexico, economic activity rose by 3.1% in 2022, roughly bringing the GDP back to pre-pandemic
levels. It benefitted from employment and wage growth, record-breaking remittances, and a strong recovery of US
tourists.
In Eastern Europe, economic developments in 2022 were completely dominated by the war in Ukraine. Westerncountries imposed massive sanctions on Russia, resulting in an estimated 2.9% contraction of the Russian economy in2022. Turkey’s economic growth slowed considerably (from a very high 11.4% in 2021 to 5.0% in 2022), due to a weakexternal environment as well as rampant inflation that weighed on consumers’ purchasing power.

84

Global insolvencies: Reversing back to normal
In 2022, global insolvencies increased on an annual basis, though they remained on the low side compared to the prepandemic situation. Fiscal support measures and temporary changes to insolvency legislation helped to protect
companies from going bankrupt during the COVID-19 pandemic. As these measures were phased out in 2022, we began
to see an increase back to the normal, pre-pandemic insolvency levels. Furthermore, the incomplete GDP recovery since
the pandemic, and negative growth effects from the war in Ukraine, also gave upward pressure to bankruptcies.
In the eurozone, relatively high increases of insolvencies were recorded in Austria, France and Belgium, countries forwhich fiscal support was phased out in the first half of 2022 and the adjustment back to normal insolvency levels
already began. However, there were also markets with relatively small increases, such as Spain, the Netherlands and
Italy. Italy and Spain already adjusted back to normal insolvency levels in 2021, whereas the normalisation did not yet
occur in the Netherlands in 2022.
In the United States, insolvencies trended upwards in 2022, but the increase was relatively mild. We suspect this had to
do with the relatively generous government support given during the COVID-19 pandemic that has improved theliquidity position of firms, preventing mass bankruptcies directly after the support was phased out. By contrast,
bankruptcies in the UK increased relatively sharply in 2022, which can be attributed to the ending of government
support measures and the weak economic recovery since Brexit. UK bankruptcies by the end of 2022 even exceeded
the pre-pandemic level.

2

Financial Situation

Credit insurance is our core business and includes traditional credit insurance for both domestic and export trades, aswell as coverage of political risks and consumer finance. The credit insurance business continued to perform well in
2022 with profit net of reinsurance of EUR 222 million. The Company offers a wide range of bonding products designed
to cover the varying needs of our customers in Belgium, France, Germany, Italy, Luxembourg, the Netherlands, theNordic region, Spain and Portugal. The bonding line posted profit net of reinsurance of EUR 28.8 million.
Insurance Revenue
Insurance revenue performed well, posting moderate growth of 15% despite the sharp negative impact of thisunprecedented pandemic. The bonding business' revenue was up 7,3%, to reach EUR 133.9 million in 2022, while credit
insurance revenue rose to EUR 1,741.6 million.
ClaimsClaims ended the year at EUR 723.9 million, 73% more than in 2021. The claims ratio reached 38,6%.
Operating Expenses
Operating expenses totalled EUR 602.3 million in 2022. Insurance brokerage commissions increased 18.7%. The
Company ended 2022 with an expense ratio of 32.1%, in comparison with the previous year's figure of close to 35.5%.
Reinsurance Result
Part of our business is ceded to our panel of reinsurers, whose aggregate share of the Company's results was EUR 270.2
million (2021: EUR 448.6 million). The reinsurance treaties arising from government support measures had a negative
impact of EUR 39.5 million on the results.
Net Investment Result
The net investment result rose to EUR 17.6 million for 2022 from the EUR 8.2 million recorded in 2021.

85

3Management of Risks, Financial Instruments and Capital

Risk Management
Note 16.2 to these financial statements describes the main risks and uncertainties and how they are managed by theCompany.
Financial Instruments Management
The most important components of financial risk are market risk, credit risk and liquidity risk.
The Company invests in a diversified portfolio of capital instruments to mitigate those risks.
Market Risk

Market risk is the risk that the fair value of assets and liabilities that are sensitive to movements in market prices will
decrease or increase due to adverse movements in equity prices, interest rates or exchange rates. The Company is
exposed to these risks by holding assets and liabilities whose fair value is sensitive to movements in those prices. Theserisks are measured using the mismatch between assets and liabilities whose fair value is denominated in foreign
currency, Value at Risk, capital models of credit risk rating institution and the duration of interest rates, among others.
ACyC uses the capital approach available under the Solvency II Directive to define strategic asset allocation and assess
the impact of investment decisions to ensure sufficient capital under Solvency II.
The estimates of the fair value of ACyC's financial assets and liabilities are their carrying amount.
The assets are exposed to increases in inflation and/or in inflation forecasts, which could accompany increases ininterest rates and lead to a decrease in the market value of bonds held in our investment portfolio. Increases in inflation
could also have an impact on the creditworthiness of bond issuers and could result in an increase in credit spreads. Allof these factors could lead to a decline in the value of the bonds.
Inflation in the costs of claims, labour costs, cost of energy and raw materials, and/or inflation due to disruptions in the
global supply chain could impact the industry. The impact of inflation on claim costs could be more pronounced forcertain of our claims that are indexed to inflation and for bonding business which is considered “long tail”.
The fair values are based on the price, as best estimate, which would be received on selling an asset or paid ontransferring a liability in an orderly transaction between market participants at the measurement date. Wheneverpossible, the fair values are based on quoted market prices. If there is no quoted market price available, valuation
techniques are used that are based on market prices of comparable instruments or on observable market observable
data. If no observable market inputs are available, valuation models are used (non-market observable data). Thesevaluation techniques are subjective in nature and rely on pricing assumptions. Deviations in those assumptions may
significantly affect the estimated fair values. Consequently, the fair values presented may not be indicative of the net
realisable value. In addition, the calculation of the estimated fair value is based on market conditions at a specific point
in time and may not be indicative of future fair values.
The fair values are subject to a control environment designed to ensure that they are determined or validated by afunction that is independent of the owner of those risks. Toward this end, ACyC defines the accounting policies andprocesses that govern the measurements and at the same time ensure compliance with the applicable accounting
legislation. Within this governance structure, non-quoted investments or illiquid investments in which ACyC invests
are measured by an external independent valuation company or the asset manager of the illiquid investment fund.
Those firms use their own proprietary valuation systems to measure the securities based on economic and market
assumptions from financial information providers. The valuations are provided on a monthly basis and are reviewed
and approved by ACyC. The valuation process of the asset manager is audited and approved by its statutory auditor.

86



Credit Risk

With regard to managing the credit risks of its financial investments, the investment policy of ACyC is to hold aprincipally euro-centric, internationally diversified portfolio and to avoid large risk concentrations. From a Standard &Poor’s rating scale or comparable perspective, the fixed income portfolio is almost completely invested in investment
grade debt securities with an ‘A-‘ rating or stronger. If a debt security bond in which ACyC has invested falls below theminimum credit rating or is not rated, it must be reviewed by the Atradius Investment Committee to decide whether theinvestment fund is still a suitable investment. The maximum concentration limit per issuer is 5% of the market value ofthe financial investments of the entity. Concentration per issuer is evaluated by aggregating the exposure to a single
issuer through both debt investments and equity securities. The Atradius Investment Committee monitors this limit andthe appropriate actions are taken if a concentration limit is breached.
The counterparty credit ratings and the credit rating of the debt instruments are predominantly based on Standard &Poor’s rating. In the absence of a Standard & Poor’s credit rating, the Atradius uses Moody’s or Bloomberg Composite
ratings.
Liquidity Risk

ACyC is exposed to liquidity risk if there is insufficient cash available to meet its financial obligations, when due, at areasonable cost. For ACyC, liquidity risks may arise if large-scale short-term fluctuations occur in cash flows, such as adecline in cash inflows or a rise in cash outflows, or a combination of both.
Liquidity risk is managed at Atradius level, in close coordination with local operations. The Atradius policy is to monitor
and measure ongoing cash flow patterns and control liquidity by maintaining sufficient cash and highly marketablesecurities to reduce liquidity risk to acceptably low levels. The investment policy states that ACyC should only invest in
financial instruments that can be liquidated within three business days or less. ACyC is able to access credit facilities toprevent liquidity shortages that can arise due to short-term cash flow variances. ACyC maintains uncommitted credit
lines in excess of EUR 1 million. It is an overdraft facility for a total of EUR 50 million (2021: 50 million euros). The credit
line provides liquidity to cover infrequent peaks in short-term liquidity requirements while also permitting ACyC to
reduce its cash balances and to benefit from a broader and more and stable investment portfolio. Lastly, ACyC has inplace a simultaneous claims payment clause in the main reinsurance treaties. This clause allows ACyC to ask thereinsurers to accelerate the payment of a large claim upon ACyC’s request instead of the usual payment terms agreed in
the reinsurance treaties.
Capital Management
Capital management is guided by the following these basic principles:
a)
b)
c)
d)
e)

Ensure the Company is sufficiently capitalised so that it has ample available capital after meetings its financial
obligations;
Comply with the local regulatory capital requirements of all ACyC branches;
Manage capital adequacy in ACyC and it branches, taking into account the economic conditions and accounting
regulations and standards together with the external rating agencies and regulatory capital requirements;
Optimise the capital structure by allocating funds across ACyC branches; andMinimise funding costs while preserving financial flexibility.

In each country in which ACyC has insurance companies established under local laws, as well as where prescribed forbranches as well, the local insurance regulator specifies the minimum amount and type of capital that must be held by
each of the subsidiaries or branches. The minimum required capital must be maintained at all times throughout theyear. In addition, the local insurance regulators have the discretionary right to impose additional capital requirements
in excess of the required minimum.
In 2022, the capital of ACyC has been managed according to the Atradius guidelines and in close cooperation with theunits involved in managing the different factors related to capital. ACyC entities were able to meet their financial
obligations efficiently and to comply with local legal and regulatory requirements.
Own Funds
The Company's own funds at year-end 2022 amounted to EUR 1,466.8 million, with a positive contribution of EUR 216.4
million from the result recorded for the year.
87

The equalization reserve reached EUR 800.5 million, demonstrating the Company's strong financial capacity to confront
potential adverse scenarios in the future.
Solvency II Directive
Solvency II is the regulatory framework for (re-)insurance undertakings and groups domiciled in the EU. It came into
effect on 1 January 2016, replacing the former regulatory regime of 14 directives which were commonly known as“Solvency I”.
ACyC is one of two regulated entities in Atradius subject to Solvency II. Under Solvency II, supervision of the AtradiusGroup is conducted by Grupo Catalana Occidente, S.A., the primary parent company.
ACyC applies a partial internal model to calculate its regulatory capital requirements. That internal model reflects thecharacteristics of our business more precisely than would be the case applying the regulatory “standard approach” andis used to calculate capital requirement for underwriting risks. The Company continues to use the standard approachfor market risks, counterparty default risk and operational risk, as the nature of those risks is such that the internal
model approach cannot be assured to be more effective. Approval for the use of our partial internal model was received
in 2017.
ACyC's capital adequacy is solid, allowing it to meet its financial obligations efficiently and comply with its legal andregulatory requirements.

884Group Companies

4.1

Iberinform Internacional, S.A.U.

Iberinform Internacional, S.A.U. (‘Iberinform’) has firmly established itself in the commercial and financial information
market, offering online international information on more than 37 countries that in aggregate account 70% of the export
destinations of Spanish businesses.
It also offers debt collection services that cover more than 200 countries. Iberinform continues developing its strategic
agreements with other companies, allowing it to bring to market innovative, value-added information-based services.
The business has performed well and recorded growth over the previous year, mainly lifted by a substantial rise inbusiness from foreign customers. Technological advances and the innovative nature of its business intelligencesolutions are the main drivers of this growth. The company's expansion has contributed to consolidate its overall profit
margins in recent years.
In 2020, Iberinform took over Iberinform Portugal S.A. and set up a branch in Portugal under the name "IberinformInternacional S.A.U. Sucursal em Portugal" to continue the business carried on by Iberinform Portugal S.A. before themerger.
4.2

Entidades en Brasil

Insurance revenue in Brazil rose 66.7%, despite the poor overall performance of the economy (EUR 15 million 2021).
The Company maintains high levels of profitability in this market with combined ratios of slightly higher than 50.9%,
thus consolidating its position as the number three operator there.

89

5

Other Information

5.1

Our People

ACyC offers products and services from offices located on six continents and had 2.569 employees at 31 December 2022
(2021: 2.565).
We observe global trends that are shaping the future of talent retention and attraction. As a result of the COVID-19
pandemic, on a global scale, people are reconsidering their job preferences and labour markets are tightening. At
Atradius, attracting and retaining talent is high on our list of priorities. In 2022, we have focused on recruitment
strategy, development opportunities and improving the onboarding experience to address this challenge. We are proudof our retention levels and we continuously invest in our people to keep this number up.
Hybrid-Working Model
In July 2021, we introduced the Hybrid-Working Model, which allows Atradius employees to split their time between
working in the office and working from home. As a starting point, we asked our employees to be in the office for 60% of
their time and be flexible for the remaining 40%. After more than a year of working with the model, we conducted apulse survey to gain insight into our employees’ experiences working with the hybrid-working model and to understandwhere we can evolve hybrid working in the future.
The results of the survey have been encouraging: 71% of employees are satisfied with the hybrid-working model.
Additionally, we scored an 8.8 on managerial trust in hybrid times, an 8.8 on enablement to work in a hybrid mannerand an 8.3 on feeling connected to the organisation. These results give us the confidence that our people can work
effectively both at home and in the office and that we can maintain our strong Atradius culture even in the hybrid way
of working.
Even though the survey showed a positive result, we will continue to adapt and evolve to become more successful with
the Atradius Hybrid-Working Model.
Developing our people
At Atradius, we encourage our employees to take the lead in their personal and professional development. We offer
support at the local and unit level and the Atradius Academy offers various (virtual) learning and development
opportunities. The courses on offer expand every year, ranging from; financial and compliance e-learning courses; tocybersecurity awareness campaigns; to diversity and inclusion webinars; and soft skills taught through classroom
trainings. Development programmes were conducted online during the COVID-19 pandemic, but during 2022 we haveresumed in person training.
Diversity, Equity and Inclusion
As we have a presence in more than 50 countries worldwide and multinational staff of whom many are multilingual,
diversity is at the heart of our company. These different backgrounds and ways of thinking enrich us. Our people are
the key to our success and we believe that collaboration between people with a mix of generations, genders and cultures
brings the best results.
We strive to create a diverse and inclusive workplace. In the Employee Engagement Survey, we outperformed theexternal benchmark when it comes to being an inclusive organisation.
We aim to continue the focus on increasing diversity and inclusion at Atradius and bring more initiatives in 2023.
The Growth Programme
In 2021, the Growth Programme focused on personal well-being and the importance of having a good balance in achallenging environment. This year, we focused on gaining an overview and focus and building strong teams in the new
hybrid-working world. Topics included managing workload, goal setting and how to create a dream team. As the wellbeing of our employees is extremely important to us, this program will continue for the third year in 2023.

90

Evolving our culture
To help our employees during these uncertain times, we strengthen our culture via Evolve+, our multi-year cultural
programme. Since 2017, the Strike initiative has been taking place - a group-wide sales competition helping build andsupport our growing competitive spirit and actively encouraging proactivity and agility. In May 2022, a winners’ event
was hosted in Madrid to celebrate the Strike League winning teams from 2019, 2020 and 2021. The teams wererecognised for their contribution, commitment and dedication to the winning of new business, and the significant
contribution they made to our Strike targets.
Another Evolve+ initiative is the Digital Ambassadors Programme – a yearly programme that trains employees to play
the role of navigator and sense-maker, providing a source of knowledge and expertise in guiding colleagues throughtheir digitalisation journey. In 2022, we had 47 colleagues participating from all around the world motivated to increase
their digital literacy and help their colleagues’ ongoing digitalisation.
Atradius Cares, under the Evolve+ initiative, was introduced in 2017 to share our resources charitably and give back tosociety. This is applicable not only for our commercial stakeholders but also for the wider community and theenvironment. Over the past years, many events have been organised locally by our colleagues around the world.
Participating in these initiatives encourages team spirit and reinforces positive and sustainable values while
contributing positively to society. It contributes to our direct community and environment, and it also broadens personal
horizons. For example, in April 2022, Atradius matched the amount that our colleagues donated to UNHCR and local
initiatives to support Ukrainian refugees.
5.2

Our Network of Brokers

Our commercial network comprises a renowned network of agents and brokers of the Company who receive continuous
support and offer a high level of professional advising throughout the entire process of offering our products andservices.
5.3

Reinsurance

The Group's reinsurance includes a quota-share treaty with retention of 37% and an excess of loss contract adapted to
the needs of our business.
The reinsurance business made a negative contribution of EUR 270.2 million (EUR 448.6 million in 2021) to theCompany's total result.
As indicated in Note 1(e) to the accompanying financial statements, during 2021 reinsurance treaties were signed withdifferent Governments that had a negative impact in 2022 of EUR 39.5 million in the Company's overall results.
The experience, technical support and financial strength of our panel of reinsurers are essential assets for our business
and we continue to deepen our professional collaboration with our reinsurers' teams of people.
5.4

Trading with Own Shares

The Company engaged in no transactions with its own shares or with shares of the parent company during 2022 or 2021
and held none of its own shares as treasury stock at those year-ends.
5.5

Average Payment Period

The average payment term to the Company's suppliers for transactions in Spain did not exceed the legal maximum thatapplied in 2022 which, according to Law 3/2004 of 29 December 2004 on measures to combat late payments incommercial operations, is set at 30 days, unless a different payment period is agreed with the supplier, which may inno case exceed the legal maximum of 60 days.
During 2022 the average payment period was 26 days as indicated in Note 11 to the financial statements.
5.6

Financial Instruments

The information on financial investments and on management of liquidity and market risk is included in Note 8 to theaccompanying financial statements.

91

5.7

Subsequent Events

The Company describes the significant events that have occurred after 31 December 2022 in Note 20 to the financial
statements.
5.8

Non-Financial Information

The Company is exempt from including the non-financial information indicated in Law 11/2018 of 28 December 2018,
because it is included in the consolidated Management Report of Grupo Catalana Occidente, S.A., the head company of
the consolidated tax group with which the Company is consolidated. The consolidated Financial Statements of Grupo
Catalana Occidente, S.A., together with its consolidated Management Report, will be deposited in the Commercial
Registry of Madrid.
5.9

Research and Development

The Company is engaged in various multiyear programmes for transformation of its business applications that will enhance
the interconnectivity of its business systems and facilitate integrated management of our insureds. Innovation projects
continued during 2021 as a cornerstone of Atradius' digital transformation, with special focus on Big Data and artificial
intelligence, connectivity, platforms, ecosystems y blockchains.
5.10

Environment, Society and Governance (ESG)

ESG developments in the Company are framed within the ESG (Environmental, Social & Governance) processes of Atradius
as a group, and those of the ultimate parent company (Grupo Catalana Occidente S.A.).
Atradius has been enabling trade for nearly 100 years and it is important for us to think about what the next 100 years will
look like in this new era of economic growth, and how Atradius will contribute to the global sustainability agenda.
We expect to see big changes in the way that trade will take place – especially as the world takes on the enormous challenge
to be net zero by 2050. Businesses are increasingly challenged with considering criteria other than economic profitability,
which means embedding sustainability in the decision-making process.
We are fully committed to ensuring that our own business is sustainable and supporting our customers to make their trade
more sustainable.
In 2022, we formalised our sustainability ambition and created a dedicated ESG Committee, to structure the various ESG
initiatives.
We have three pillars that reflect the different aspects of Sustainability and the ambition we are aiming for:
PlanetAtradius enables sustainable trade by supporting the most sustainable ways of doing business and we promote trade thatis planet positive.
Our ambition:







Shifting our portfolio to Net Zero by 2050
Helping our customers find planet positive trading partners
Supporting our customer’s transition to clean production and supply chain
Supporting our customers to lower their carbon footprint
Responsible investment
Carbon neutral in our own operations

PeopleAtradius empowers people & communities and we value the richness of genders, races, cultures and personalities.

92

Our ambitions:









Equal opportunity employer regardless of genders, races and cultures
Delivering value through diversity and inclusion
Enhancing employability
Supporting well-being of employees
Giving back to society
Striving for a good balance between the prosperity of communities and the impact on the environment
Helping / coaching sustainable entrepreneurs
Guiding / training our employees to contribute to a more sustainable future individually

Prosperity
Atradius pursues sustainable growth for the company, driven by transparency and integrity, fostering sustainable
prosperity.
Our ambitions:







Safeguarding the company through compliance with relevant international ESG standards. We also voluntarily
define goals that go beyond compliance
Building ESG factors into our strategic decision framework
Innovation for growth – tapping into the potential of growing clean industries via matching products, services andbusiness models
Insurer of choice: trusted partner for sustainable global trade
Partnership with growing green finance
Attracting, motivating and retaining the best talent to achieve our sustainability goals

External Assessment of our activities
As a measure of the quality of our sustainability management system, our policies, actions and results were assessed on 21
sustainability criteria by EcoVadis (Business Sustainability Rating Agent, Barcelona), ranging from environment, labourand human rights, to ethics and sustainable procurement. The resulting scorecard puts Atradius in the upper half of all rated
companies.
Since 2008 we have subscribed to the ten principles of the United Nations Global Compact (UNGC) on human rights, labour
conditions, the environment and anti-corruption. Every year we provide an update on the progress we have made.
Moodys have assigned Atradius an ESG rating of CIS-2. This score is made up of two components. The Credit Impact scoreof Atradius is assessed as Neutral to low. The Issuer Profile Score has been assessed as neutral to low for Environmental(E), Social (S) and Governance (G) components.

6

Outlook for 2023

We predict global economic activity to slow to 1.3% in 2022. This marks the weakest growth profile since the global
financial crisis (excluding the COVID-19 virus-driven downturn in 2020). Three critical factors weigh on growth:monetary policy tightening in response to high inflation, the impact of the war in Ukraine, and the ongoing impact oflockdowns (particularly in China) and supply chain disruptions. None of these factors is likely to be fully resolved in
2023.
Emerging markets are forecast to show relative resilience in 2023, with GDP growth forecast to go only a notch down,from 3.6%in 2022 to 2.9% in 2023. This partly reflects idiosyncratic factors, such as a rebound in Chinese growth as the
economy emerges from COVID lockdowns and an easing in the pace of contraction in Russia. Emerging Asia remains
the fastest growing region in 2023 (3.8%). In China, growth is foreseen to improve to 4.2%, due to a partial reversal of
the COVID lockdowns of last year, and further aided by existing policy support and infrastructure spending. For Eastern
Europe, we forecast a recession in 2023, reflecting negative growth in Russia as well as a sharp slowdown of growth inTurkey. We do not expect the war between Russia and Ukraine to be resolved soon.

93Growth in advanced economies is projected to slow to 0.2%. Several key advanced markets – US, UK and eurozone – areexpected to fall into recession in 2023. GDP growth in the United States is expected to decline further as stubborn
inflation and hawkish monetary policy take their toll on consumption. Eurozone GDP growth is also expected to be innegative territory, mainly as a result of high energy prices. Governments in advanced markets continue to provide fiscal
support in 2023, though the fiscal position is slightly less expansionary than last year. Central banks are expected tocontinue to keep monetary policy relatively tight as long inflation does not come down.
In 2023, insolvencies in most markets continue to adjust to normal, pre-pandemic levels. There remains, however, awide dispersion of insolvency projections across countries. In South Korea, New Zealand, the United States and theNetherlands, the withdrawal of fiscal support is likely to lead to a strong increase in insolvencies, after insolvencies
stayed relatively low in 2022. There are, however, also countries with a relatively small increase in insolvencies. The
UK, for example, saw insolvencies already exceeding the pre-pandemic level in 2022, putting a lid on insolvency growthin 2023. Three markets – Romania, Switzerland and Spain – are expected to see a decline in annual insolvency growthin 2023.
Risks to the world economy remain high. New disruptions to energy markets resulting from the Russia-Ukraine war,
policy mistakes in monetary tightening, or new, more lethal COVID-19 virus variants, are all risks that could further
derail the global economy. The current risk environment makes it even more challenging for companies to emerge
stronger from the COVID-19 pandemic.

Board of Directors
Xavier Freixes
Bernd Hinrich Meyer
Hugo Serra
Désirée van Gorp
John Hourican
Carlos Halpern
José María Sunyer
Juan Ignacio Guerrero
Joaquín Guallar

94

El Consejo de Administración de ATRADIUS CRÉDITO YCAUCIÓN S.A. DE SEGUROS Y REASEGUROS, en su
reunión de hoy, 1 de Marzo de 2023, ha formulado las
Cuentas Anuales (PCEA) y el Informe de Gestión de laCompañía, correspondientes al ejercicio cerrado al 31 dediciembre de 2022, que constan extendidos en ____
páginas numeradas correlativamente, además de lapresente y las siguientes páginas de firma numeradas dela (i) a la (ix), ambas inclusive.
Y para que así conste, en cumplimiento de lo preceptuado
en el artículo 253 de la Ley de Sociedades de Capital, losConsejeros que se relacionan en las siguientes páginas
firman esta manifestación, a 1 de Marzo de 2023

The Board of Directors of ATRADIUS CRÉDITO YCAUCIÓN S.A. DE SEGUROS Y REASEGUROS, in themeeting held today, 1 March 2023, has formulated theAnnual Accounts (Spanish GAAP) and the Management
Report of the Company, corresponding to the financial
year ended 31 December 2022. They consist of ____
consecutively numbered pages, in addition to this and thefollowing signature pages numbered from (i) to (ix), bothincluded.
And as an evidence thereof, in compliance with theprovisions of article 253 of the Spanish Companies Act,
the Directors referred to in the following pages sign thisstatement, on 1 March 2023.

Xavier Freixes Portes

Bernd Hinrich Meyer

Hugo Serra Calderón

Désirée Maria van Gorp

John Patrick Hourican

Carlos Halpern Serra

José María Sunyer Sendra

Juan Ignacio Guerrero

Joaquín Guallar

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