Connected
Leading the future
Annual Report 2017 Atradius N.V.
Annual Report 2016 Atradius N.V.

Contents
This is Atradius .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 3Our 2017 performance at a glance .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 6Ten years in figures.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 8

A message from the Management Board
Connected

9Business profile .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 13
Products, services and brand .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 13
Global footprint.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 16
Atradius Group organisation . .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 18

Corporate governance .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 20
Report of the Supervisory Board. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 20
Shareholder structure. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 22
Connected to people

Corporate governance. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 25

Consolidated management report. .  .  .  .  .  .  .  .  .  .  .  .  . 0031
The global economic environment .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 31
Business performance . .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 34
Human resources .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 44
Risk and capital management .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 46
Corporate responsibility .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 48

Financial statements . .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 53
Connected through technology

Consolidated financial statements 2017. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 54
Company financial statements 2017 . .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 139

Other information . .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 146
Independent auditor’s report .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 149
Glossary.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 152.
	 Overview of subsidiaries, branches, associatedcompanies and minority shareholdings .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 155

Connected on the go
Click on the arrow  

2

to go straight to that section of the reportAtradius | This is AtradiusThis is Atradius

People don’t care how much you know
until they know how much you care.
Theodore Roosevelt
When Roosevelt said this he was speaking about politics, but this is aprinciple which equally applies to business and this is something that we
believe in at Atradius. We genuinely care about our customers’ businesses andtheir success.
At Atradius we engage in a very real sense with our customers, connectingwith them on many levels to provide the best possible service. We arecommitted to excellence in our support of trade across the globe and in all ofour business lines. That commitment is essential for our continuing successand that of our customers.
Connecting with customers is crucial to the service we provide. Connectingwith customers means understanding their business and getting to know
the people involved so that we can deliver a service that suits their needs,
whether this is for a highly involved one-to-one service, or a more hands-off
digital experience. Either way Atradius has the people and tools to deliver
first-class cover, information and insight that truly enables trade forour customers.
As our customers’ businesses grow and the world in which they are trading
evolves, so do the demands that they place on us. That’s why we arecontinuously innovating to enhance the ways in which we serve them. We
want to support our customers to not only manage the trade credit risks thatare inherent in business, but also to meet the new challenges that the fastpaced, digital world is bringing.
We continue to raise the bar in our digital connections, with tools like Atradius
Insights and Atradius Atrium providing our customers and partners with vital
information to help them manage risk. Regular tasks such as applying for
credit limits or submitting claims have been streamlined and simplified so
our customers can focus more of their time on activities that add value totheir business.

3

Atradius | This is Atradius

It isn’t only digital connections that make Atradius a strong and reliable
partner. The relationship that we build – through personal contact – plays
the most significant role in defining what we stand for and creating longlasting and mutually beneficial bonds. Through this personal interaction
we can fully understand what our customers expect from us and respondaccordingly. This personal interaction also allows us to display to ourcustomers what Atradius stands for and the values that underpin ourorganisation and culture.
It is important to Atradius that we are geographically close to ourcustomers’ operations and to the markets in which they trade to build theseconnections and understand our customers’ businesses and the risks they
face. Our presence in over 50 countries across six continents ensures that
we have a good understanding of the cultural, political, legal and economic
peculiarities of the markets they are trading in.
Atradius connects in many ways, not only with our customers andintermediaries but, equally importantly, with information providers,insurance partners & fronters, reinsurers and collections networks that arevital to Atradius’ ability to provide our services and meet - and exceed - ourcustomers’ expectations.
All of these connections have evolved and strengthened over the years toenable us to help our customers achieve success in growing their businessby increasing the value of the services we provide.
As a result, we don’t just work for our customers: we genuinely workwith them.

4

We don’t just workfor our customers:
we genuinely
work with them.

Atradius | This is Atradius

The evolution of Atradius
1925 –	NCM (Nederlandsche Credietverzekering Maatschappij) is foundedin the Netherlands, with the aim of improving trading conditions for
Dutch companies.
1929 – Crédito y Caución is founded, becoming the first credit insurer in the
Spanish market.
1932 –	NCM partners with the Dutch government to provide export credit
services to Dutch companies on behalf of the Dutch State. This
relationship continues to be successful.
1954 –	In Germany, Gerling Kreditversicherung (Gerling Credit) is
established as the credit insurance arm of the Gerling Group.
1962 – Gerling Credit opens its first international branch office in
Switzerland, and is the first private credit insurer to offer export
credit protection.
1991 –	NCM acquires the short-term export credit arm of the UK’s Export
Credit Guarantee Department (ECGD), itself a long-standing
credit insurer.
2001 –	The paths of NCM and Gerling Credit meet and Gerling NCM
is formed.
2004 – Gerling NCM rebrands to Atradius.
2008 –	Grupo Catalana Occidente S.A. becomes the major shareholder ofAtradius. Crédito y Caución becomes a key part of the Atradius Group.
2011 –	Atradius launches its Roadmap for Success; a strategy to enable its
regional teams across the globe to be even more responsive to theircustomers’ needs.
2013 – Atradius redefines its corporate guiding principles with a clear focus
on delivering tailor-made solutions in each of its markets.
2014 –	Grupo Catalana Occidente S.A. celebrates its 150th anniversary, andthe 10th anniversary of the Atradius brand.
2016 –	Atradius merged its two European insurance carriers consolidating
the leadership in the market, and strengthen its information services
by acquisitions of Graydon Holding N.V. (Graydon) in the Netherlands
and IGNIOS Gestão Integrada de Risco S.A. in Portugal (now named
Iberinform Portugal).
2017 –	Atradius acquires 25% of Credit Guarantee Insurance Corporation of
Africa Ltd.

5

Atradius | This is Atradius

Our 2017 performanceat a glance
Building our business by connectingwith our customers across the world• Total income increased by 2.5% (3.2% at constant foreign exchange rates).
• T otal revenue increased by 4.3% including service and other income (5.1% atconstant foreign exchange rates), supported by growth in the Global unit, North
America, Asia and Central and Eastern Europe.
• T he investment return contributed positively to the bottom line. Excluding
extraordinary impact for associated companies, net investment result
increased by 8.6%.
• O ur risk acceptance remained balanced in 2017 with a solid 41.7% claims ratioby successfully managing claims costs in a challenging risk environment.
• The combined ratio ended at 77.4% (1).
• The result for the year was EUR 186.2 million.
• O ur shareholders’ equity and subordinated debt position was further
strengthened by 6.6%, resulting from profit generation.

Management Board
Isidoro Unda, Chairman
Andreas Tesch
Christian van Lint
Claus Gramlich-Eicher
Marc Henstridge

The Supervisory Board		
Ignacio Álvarez, Chairman
Francisco Arregui, Vice-Chairman
Bernd H. Meyer
Dick Sluimers
Xavier Freixes
Hugo Serra
Désirée van Gorp
John Hourican
Carlos Halpern
José María Sunyer

Supervisory Board Committees
Audit Committee
Remuneration, Selection and Appointment Committee
	The combined ratio is calculated using the insurance industry standard;
the sum of claims and expenses divided by insurance revenue.

(1)

6

Atradius | This is Atradius

Total	
  Total	
  Total	
  Total	  RRRevenue	  Revenue	  evenue	  evenue	
  

In	
  
In	
  
In	
  
EIn	
  
EUR	
  
EUR	
  
EUR	
  
UR	
  
mmm
illion	  million	  illion	  illion	
  

	
  	
   	
  	
  

2017	
  
2017	
  
2017	
  
2017	
  
2015	
  
2015	
  
2015	
  
2015	
  

1,627	
  
1,627	
  
1,627	
  
1,627	
  
1,578	
  
1,578	
  
1,578	
  
1,578	
  

2013	
  
2013	
  
2013	
  
2013	
  
1,000	
  1,000	
  1,000	
  1,000	
  1,100	
  1,100	
  1,100	
  1,100	
  

1,200	
  
1,200	
  
1,200	
  
1,200	
  1,300	
  1,300	
  1,300	
  1,300	
  

(1)
(1)
Net	
  
Net	
  
Net	
  
Net	
  
IInvestment	
  nvestment	
  IInvestment	
  nvestment	  RRResult	  Result	  esult	  esult	
  
	
  	
  (1)
	
  	
  (1)

1,400	
  
1,400	
  
1,400	
  
1,400	
  1,500	
  1,500	
  1,500	
  1,500	
  

1,600	
  
1,600	
  
1,600	
  
1,600	
  

1,837	
  
1,837	
  
1,837	
  
1,837	
  
1,761	
  
1,761	
  
1,761	
  
1,761	
  
1,718	
  
1,718	
  
1,718	
  
1,718	
  

1,700	
  
1,700	
  
1,700	
  
1,700	
  

1,800	
  
1,800	
  
1,800	
  
1,800	
  

	
  	
  	
  	
  	
  	
  	
  	
  

In	
  
In	
  
In	
  
EIn	
  
EUR	
  
EUR	
  
EUR	
  
UR	
  
mmm
illion	  million	  illion	  illion	
  

	
  	
   	
  	
  

25	
  
25	
  
25	
  
25	
  
23	
  
23	
  
23	
  
23	
  

2017	
  
2017	
  
2017	
  
2017	
  
2015	
  
2015	
  
2015	
  
2015	
  

36	
  
36	
  
36	
  
36	
  
38	
  
38	
  
38	
  
38	
  
35	
  
35	
  
35	
  
35	
  

2013	
  
2013	
  
2013	
  
2013	
  
0	
  0	
  0	
  0	
  

5	
  5	
  5	
  5	
  

10	
  
10	
  
10	
  
10	
  

1,900	
  1,900	
  1,900	
  1,900	
  

15	
  
15	
  
15	
  
15	
  

20	
  
20	
  
20	
  
20	
  

25	
  
25	
  
25	
  
25	
  

30	
  
30	
  
30	
  
30	
  

35	
  
35	
  
35	
  
35	
  

45%	
  
45%	
  
45%	
  
45%	
  

46%	
  
46%	
  
46%	
  
46%	
  

40	
  
40	
  
40	
  
40	
  

Claims	  Claims	  Claims	  Claims	  RRRa4o
Ra4o
a4o
a4o 	
  	
  	
  	
  	
  
41.7%	
  
41.7%	
  
41.7%	
  
41.7%	
  
41.6%	
  
41.6%	
  
41.6%	
  
41.6%	
  

2017	
  
2017	
  
2017	
  
2017	
  
2015	
  
2015	
  
2015	
  
2015	
  
2013	
  
2013	
  
2013	
  
2013	
  
38%	
  
38%	
  
38%	
  
38%	
  

43.5%	
  
43.5%	
  
43.5%	
  
43.5%	
  40.7%	
  40.7%	
  40.7%	
  40.7%	
  
39%	
  
39%	
  
39%	
  
39%	
  

40%	
  
40%	
  
40%	
  
40%	
  

41%	
  
41%	
  
41%	
  
41%	
  

45.6%	
  
45.6%	
  
45.6%	
  
45.6%	
  

42%	
  
42%	
  
42%	
  
42%	
  

43%	
  
43%	
  
43%	
  
43%	
  

44%	
  
44%	
  
44%	
  
44%	
  

47%	
  
47%	
  
47%	
  
47%	
  

Expense	
  Expense	
  Expense	
  Expense	  RRRa4o
Ra4o
a4o
a4o	
  	
  	
  	
  	
  
35.7%	
  
35.7%	
  
35.7%	
  
35.7%	
  

2017	
  
2017	
  
2017	
  
2017	
  

36.4%	
  
36.4%	
  
36.4%	
  
36.4%	
  

2015	
  
2015	
  
2015	
  
2015	
  

35.9%	
  
35.9%	
  
35.9%	
  
35.9%	
  

2013	
  
2013	
  
2013	
  
2013	
  
35%	
  
35%	
  
35%	
  
35%	
  

35%	
  
35%	
  
35%	
  
35%	
  

36%	
  
36%	
  
36%	
  
36%	
  

36%	
  
36%	
  
36%	
  
36%	
  

37%	
  
37%	
  
37%	
  
37%	
  

37%	
  
37%	
  
37%	
  
37%	
  

(2)	
  
(2)	
  
Result	  Result	  Result	  Result	
  
FFor	
  
For	
  
For	
  
or	
  
TTThe	
  
The	
  
he	
  
he	
  
YYYear	
  
Year	
  
ear	
  
ear	
  
	
  	
  (2)	  	  	
  (2)	
  

	
  	
   	
  	
  

186	
  
186	
  
186	
  
186	
  

2015	
  
2015	
  
2015	
  
2015	
  

135	
  
135	
  
135	
  
135	
  

2013	
  
2013	
  
2013	
  
2013	
  
50	
  
50	
  
50	
  
50	
  

100	
  
100	
  
100	
  
100	
  

178	
  
178	
  
178	
  
178	
  
161	
  
161	
  
161	
  
161	
  

150	
  
150	
  
150	
  
150	
  

	
  	
   	
  	
  

1,753	
  
1,753	
  
1,753	
  
1,753	
  
1,626	
  
1,626	
  
1,626	
  
1,626	
  1,500	
  1,500	
  1,500	
  1,500	
  1,393	
  1,393	
  1,393	
  1,393	
  1,287	
  1,287	
  1,287	
  1,287	
  

2015	
  
2015	
  
2015	
  
2015	
  
2013	
  
2013	
  
2013	
  
2013	
  

(2)

250	
  
250	
  
250	
  
250	
  

In	
  
In	
  
In	
  
EIn	
  
EUR	
  
EUR	
  
EUR	
  
UR	
  
mmm
illion	  million	  illion	  illion	
  

2017	
  
2017	
  
2017	
  
2017	
  

(1)

212	
  
212	
  
212	
  
212	
  

200	
  
200	
  
200	
  
200	
  

Equity	  Equity	  Equity	  Equity	
  

0	
  0	
  0	
  0	
  

38%	
  
38%	
  
38%	
  
38%	
  

In	
  
In	
  
In	
  
EIn	
  
EUR	
  
EUR	
  
EUR	
  
UR	
  
mmm
illion	  million	  illion	  illion	
  

2017	
  
2017	
  
2017	
  
2017	
  

0	
  0	
  0	
  0	
  

37.1%	
  
37.1%	
  
37.1%	
  
37.1%	
  

36.6%	
  
36.6%	
  
36.6%	
  
36.6%	
  

200	
  
200	
  
200	
  
200	
  

400	
  
400	
  
400	
  
400	
  

600	
  
600	
  
600	
  
600	
  

800	
  
800	
  
800	
  
800	
   1,000	
  1,000	
  1,000	
  1,000	
   1,200	
  
1,200	
  
1,200	
  
1,200	
   1,400	
  1,400	
  
1,400	
  
1,400	
   1,600	
  1,600	
  
1,600	
  
1,600	
   1,800	
  1,800	
  
1,800	
  
1,800	
   2,000	
  2,000	
  2,000	
  2,000	  (1)
(1)(1)
(1)
Net
Net
Net
Net
Investment
Investment
Investment
Investment
ResultResultResultResultconsists
consists
consists
consists
of
ofof
of
net
net
net
net
incomeincomeincomeincome
from
from
from
from
investments
investments
investments
investments
and
and
and
and
share
share
share
share
of
ofof
of
associatedassociatedassociatedassociatedcompanies
companies
companies
companies(excluding(excluding(excluding(excluding
realisedrealisedrealisedrealised	N
etInvestment
Resultconsistsof
net income
from investments
and
share
of
associatedcompanies
gains
gains
gains
gains
&&&
losses,&losses,losses,losses,
and
and
and
and
impactimpactimpactimpactofofofofvaluation
valuation
valuation
valuation
of
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of
associatedassociatedassociatedassociatedcompanies
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companies
inin
in
2016
in
2016
2016
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and
and
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2017).
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2017).
2017).
(2)
(2)
(2)
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(excluding
realisedgains& lossesandimpactof valuation
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and 2017).
ResultResultResultResult
of
ofof
of
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the
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the
year
year
year
year
includesincludesincludesincludes	  	
  impacti	
  mpact	
  impact
impactof
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companies
companies(minus(minus(minus
EUR
EUR
EUR
EUR
11.7
11.7
11.7
11.7
millionmillionmillionmillion
2017
2017
2017
2017
impairment
impairment
impairment
impairment
and
and
and
and
EUR
EUR
EUR
EUR
22.2
22.2
22.2
22.2

millionmillionmillionmillion
2016
2016
2016
2016
realisedrealisedrealisedrealised
gains)
gains)
gains)
gains)
	Result for the year includes impact of associated companies (minus EUR 11.7 million 2017 impairment
and EUR 22.2 million 2016 realised gains).

7

Atradius | This is Atradius

Ten years in figures
Financial information(in EUR million)

20172016 (1)

2015

2014

2013

2012

2011

2010

2009

2008

Insurance premium revenue

1,588.1

1,557.6

1,537.0

1,458.2

1,412.1

1,439.8

1,403.4

1,345.6

1,468.6

1,616.4

Service and other income

249.1

203.1

180.8

169.0

166.4

161.8

150.5

155.1

197.8

225.4

Total revenue

1,837.2

1,760.7

1,717.8

1,627.2

1,578.4

1,601.6

1,553.8

1,500.7

1,666.4

1,841.8

24.7

22.8

36.0

37.8

35.1

30.3

31.1

22.7

68.3

47.8

Total income

1,861.9

1,805.6

1,753.8

1,665.0

1,613.5

1,632.0

1,584.9

1,523.4

1,734.7

1,889.6

Result for the year

186.2

211.8

178.2

161.2

134.5

113.6

129.8

124.9

(113.3)(193.4)Equity1,753.2

1,625.5

1,500.2

1,393.0

1,286.9

1,196.3

1,129.8

1,035.2

905.0

1,005.5

Total assets

4,519.2

4,391.5

4,250.2

4,130.9

3,697.8

3,737.2

3,580.1

3,285.2

3,389.7

4,021.0

Insurance contracts

1,530.3

1,561.2

1,648.8

1,572.2

1,486.3

1,592.8

1,549.3

1,311.8

1,508.1

2,166.9

Return on equity (3)

11.0%

13.6%

12.3%

12.0%

10.8%

9.8%

12.0%

12.9%

(12.0%)(17.0%)

Outstanding ordinary
shares (at year-end)

79.1

79.1

79.1

79.1

79.1

79.1

79.1

79.1

79.1

79.1

Dividend paid

76.7

71.2

64.9

53.8

43.5

43.5

25.3

-

-

25.3

Net investment result (2)Balance sheet information(in EUR million)

Shareholders information

Technical ratios
Gross claims ratio

41.7%

41.6%

43.5%

40.7%

45.6%

51.2%

49.7%

38.6%

85.2%

98.3%

Gross expense ratio

35.7%

36.4%

37.1%

36.6%

35.9%

35.0%

35.2%

35.4%

36.6%

34.1%

Gross combined ratio

77.4%

78.0%

80.6%

77.3%

81.5%

86.2%

84.9%

74.0%

121.8%

132.4%Net claims ratio

41.4%

42.0%

42.0%

42.6%

46.4%

49.1%

50.3%

44.6%

76.6%

96.9%

Net expense ratio

34.2%

35.4%

35.9%

35.8%

37.4%

37.5%

34.2%

39.3%

46.2%

32.3%

Net combined ratio

75.5%

77.4%

77.9%

78.3%

83.8%

86.7%

84.5%

83.9%

122.9%

129.2%

3,596

3,586

3,161

3,139

3,107

3,143

3,149

3,171

3,488

3,863

Employees
Full-time equivalents(FTE), at year-end
Credit ratings
A.M. Best‘A, outlook stable’

Moody's‘A2, outlook stable’

Including Graydon, Iberinform Portugal, Gestifatura and Informes Mexico since Q3 2016.

(1)	Net income from investments excluding extraordinary impact of associated companies (minus EUR
11.7 million 2017 impairment, and EUR 22.2 million 2016 realised gains).

(2)

(3)

Return on equity is defined as the result for the year divided by the time weighted average
shareholders’ equity.

8

Atradius | A message from the Management Board Atradius N.V.

A message from theManagement Board

Left to right: Claus Gramlich-Eicher, Marc Henstridge, Isidoro Unda, Christian van Lint and Andreas Tesch.

Dear stakeholder,2017 was an exciting year for Atradius. We have continued to cement our excellent
performance and leadership at the same time as embedding plans to future-proof
our organisation for the years to come. Our financial results are evidence that
Atradius is a strong and reliable business partner with market leading retention
levels (93.0%), a combined ratio of 77.4% and a strong and growing capital base(including subordinated debt) of EUR 2,077 million up by 6.6%.
We find ourselves in an environment where technology is changing the faceof trade and the way that we interact with our customers and partners. Being‘connected’ to our customers – both in terms of personal relationships and ina technological sense - is very important to Atradius and something that we
continue to invest in, at both a strategic and an operational level.
Atradius has always been at the forefront of innovative technology in our
industry. We were the first credit insurer to offer customers an online policy
management tool and connectivity web services. We have a long history ofusing sophisticated algorithms to drive automation of underwriting so we
can provide instant credit limit decisions to our customers on high volumesof limits and our global IT platform is a foundation from which we are able toprovide the best service to our customers on a multinational basis.

9Technology ischanging theface of trade andthe way that weinteract with ourcustomers.

Atradius | A message from the Management Board Atradius N.V.

At Atradius we understand the ways that global trade is evolving andthe challenges our customers are facing to continue growing in a safe
environment. We are advancing our digital capabilities to adapt ourbusiness to the changing environment and strengthen our connections
with the customer. In 2017 we launched Atrium, our new online customer
portal, where insured customers can access all their Atradius services.
Atrium delivers streamlined and simplified processes that put the customer
and their business at the centre. Atradius Collections also developed an
e-commerce platform where customers can purchase Collections services
directly from Atradius online and an online payments portal to increase theefficiency and effectiveness of collecting debtors’ payments. This tool is to belaunched in 2018.
In 2017 we started a multi-year programme to enhance our core systems
using the latest technology to deliver the best digital experience for ourcustomers, partners and teams. For our customers this will include easierways to connect with us to reduce the time needed to administer theirpolicy. We want our customers to focus on our value added services that will
provide information and insights on risks and opportunities that can put
them one step ahead of their competitors. For our teams this will include
being able to access systems via mobile devices so they can spend moretime in front of the customer, fulfilling the important role of working in
partnership to enable trade.
For our partners this will include new and more efficient ways of sharing
information so that our services can be more easily integrated with there isat the point in time when it is needed.
Our ability to deliver reliable standards of service and of the highest quality
requires collaboration and connectivity on a global scale across time zones
and cultures. At Atradius, this is possible because of the strong work ethicof our teams but also through the systems and IT connections that are inplace for them. Atradius is proud to have a global IT system, that means anunderwriter in Hong Kong can access the same information on a buyer as
an underwriter in Paris at any given moment. This is a foundation of ourcore business.
As well as improving our core systems, Atradius is also using technology toinnovate in Credit Management. We understand the rapid, and potentiallydisruptive, nature of some of the latest technology trends. We areharnessing newer technologies to integrate the growing areas of blockchain,
platforms, big data and advanced analytics into our core business. We arealso stimulating innovation ideas from within the organisation via our‘Innovation Hub’ which allows all staff to play a part in the innovation
journey of Atradius and learn about the trends and technologies which areshaping the world of tomorrow.
2017 saw further expansion of the Atradius Group with new Credit Insurance
offices opened in Bulgaria and Romania, the completion of the acquisitionof a 25% stake in the South African Credit Guarantee Insurance Corporationof Africa Ltd. and increased presence of Atradius Collections through newcooperations in Indonesia and Portugal. These are important steps in
Atradius’ growth strategy to deliver a more complete service to
our customers.

10

An underwriterin Hong Kongcan access thesame information
on a buyer as
an underwriterin Paris.

Atradius | A message from the Management Board Atradius N.V.

During 2017 Atradius achieved a significant milestone with the regulatory
approval of our Partial Internal Model for underwriting risk. Atradius has aninternally developed economic capital model for the calculation of regulatory
capital under Solvency II. With this approval our supervisors confirm
the sophistication of Atradius’ risk modelling capabilities. With a strong
solvency position, including well capitalised operating entities, we are able
to withstand financial stress, meet our financial obligations and ultimately
deliver shareholder value.
Atradius’ sound financial position and its leading position in the credit
insurance industry are reflected in the robust credit ratings assigned to the
Atradius Group by A.M. Best (‘A’ excellent, Outlook Stable) and Moody’s(‘A2’, Outlook Stable). Moody’s upgraded Atradius to ‘A2’ from ’A3’ inMarch 2018. The rating upgrade by Moody’s is a recognition of the strong
and consistent profitability as well as solid capital position of Atradius.
Atradius’ profits over recent years have been supported by steady revenues,
a relatively low claims ratio and solid cost control. The company’s financial
situation has continued to prosper with a profit of EUR 186 million in 2017
and the shareholders’ equity at an historic high.
The outlook for 2018 is one of continued strengthening of the global economy
with worldwide growth forecast to increase to 3.2%. The main challenges
to growth that we have experienced in recent years (low inflation, negative
bond yields, austerity and low commodity prices) are slowly starting tophase out and the outlook for emerging markets is brighter. Atradius is areliable partner in managing risk through bad times and good. We workwith customers and business partners to avoid risk and seek opportunities
so that we deliver on our promise to ‘enable trade’ for our customers. We willcontinue to focus on growth, service and sustainability and leverage the latest
technologies to evolve our value proposition so that we can provide the best
digital experience for our customers.
The Management Board would like to thank our customers, business partners,
brokers, reinsurers, agents and our employees for helping us to achieve our
excellent results in 2017 and we look forward to the challenges that 2018 willbring and working alongside you to make it another successful year.

The Atradius Management Board
Isidoro Unda, Chairman
Andreas Tesch
Christian van Lint
Claus Gramlich-Eicher
Marc Henstridge

11

We work withcustomers
and business
partners to avoid
risk and seek
opportunities.

Connected

12

Atradius  |  Business profile Atradius N.V.

Products and services
Our products and services are designed
to provide businesses of all sizes withpeace of mind and commercial advantage.
We work in all sectors with teams ofexperienced underwriters who areexperts in the type of businessthey underwrite.
Credit insurance offerings to suit all sizes of businessOur core product - credit insurance - provides cover for financial losses
arising when a customer’s buyer can’t or won’t pay for goods and services
bought on credit.
Our strategy is to focus on a range of business segments: offering credit
insurance tailored to the needs of small and medium-sized enterprises (SMEs),
medium-sized and large local companies, and multinational corporations.
For multinationals we offer a sophisticated and tailored credit management
solution in the form of our Global policy. As a market leader and pioneer with 20
years of experience in this segment, Atradius Global has developed an excellent
understanding of the needs of multinationals.
Global customers can choose between a credit insurance policy with standard
terms and conditions, serving both the parent company and all its subsidiaries,
stand-alone policies that accommodate varying performance levels and country
conditions, or a combination of both.
Our dedicated Global account teams are situated across the world, providing
extensive cross-border customer service. Dedicated underwriters ensure
consistent high quality decision making on the buyer portfolio of our
Global customers.
For our large and medium-size customers we offer a flexible modular credit
insurance policy that gives protection against non-payment and allows theterms of cover to be adapted to each customer’s needs. In this way, covercan be adapted to fit all kinds of businesses, large and small, doing businessdomestically or across the world.
To meet the many different demands of SMEs we have created a range of SME
products, all of which are characterised by their simplicity.

13

Our strategy is
to focus on a
range of businesssegments.

Atradius  |  Business profile Atradius N.V.

We realise that traditional credit insurance cover, on a ‘whole turnover’ basis,
may not be the right solution for every company. That is why we offer a rangeof structured credit risk solutions for specific large and complex transactions.
These solutions address a range of circumstances, from enhanced credit
protection for single contracts or buyers to pre-export finance, and can be
combined to meet multiple needs.

Insuring the insurers
Atradius Reinsurance DAC (Atradius Re) is the leading specialised credit
and bonding reinsurer in the market, offering reinsurance solutions forthe credit insurance and bonding business of primary insurers around theworld, through its dedicated team of underwriters. The combination of theskills of a reinsurer with the experience of a leader in credit insurance andbonding reinforces Atradius Re’s most developed proposition to the market.
The reinsurance business is underwritten by a dedicated team of specialist
underwriters based in Dublin at Atradius Re.

A leading bond provider in Europe
Present in 11 European markets, Atradius Bonding serves a wide portfolio oflarge corporates and SMEs active in different sectors, looking for a uniquebonding partner to support them locally and internationally. Our longstanding bonding expertise, deep local market knowledge and the ability to
seize niche market opportunities allow us to offer flexible solutions that meetthe needs of our customers. We have benefitted from steady growth over thelast couple of years thanks to the consolidation of our portfolio and earned thetrust of major organisations, making us a leading bond supplier in Europe.

Covering the risks of multiple instalment agreements
Atradius Instalment Credit Protection (ICP) covers short and medium-termrisks involved in multiple instalment agreements with private individuals
and businesses. The core product offering of ICP covers consumer credit,
leasing and renting risks. More recently the product range has been extended
to offer residential real estate insurance products for co-ownerships and forrental guarantees as well as products for private car leasing arrangements.
The latest new product - B2C Protect – is offered to customers in theconstruction sector to protect against payment default by home owners. ICP’s
services are offered to financial and corporate policyholders in Belgium andLuxembourg.

Skilled and sensitive debt collections
With worldwide expertise and local staff in 29 countries, Atradius Collections
helps businesses - both insured and uninsured - to collect domestic andinternational trade debts while maintaining sound business relationships
with their clients. It has built a strong reputation as a dedicated businessto-business specialist, leveraging the strength of Atradius Credit Insurance,
combined with its own integrated international network of collectors, lawyers
and insolvency practitioners as well as its online capabilities.

14

We offer a rangeof structured
credit risk
solutions for
specific large
and complex
transactions.

Atradius  |  Business profile Atradius N.V.

Since 2015 Atradius Collections has also offered a first party collections
service, so that customers can outsource their reminder process immediately
after due date. A range of services has been created for the financial industry,including back-up servicing, cross border collection and invoice verification,
allowing factoring companies and asset based lenders to investigate whether
the business transactions and/or invoices from their client are acknowledgedby the buyer.

Working with the Dutch State
Atradius Dutch State Business (ADSB) is the Export Credit Agency of theNetherlands. To minimise the risks of non-payment that are not covered by
the private market, ADSB offers a wide range of insurance and guarantee
products to Dutch exporters of capital goods, internationally operating
construction companies, their financiers and/or investors. ADSB works onbehalf of, and for the account of the Dutch State, making sure that exporttransactions can be completed successfully.

Business intelligence
Atradius offers business intelligence services through the following
companies: Iberinform in Spain and Portugal, Graydon in the Netherlands,
Belgium and UK and Informes in Mexico. These companies support
Atradius by providing information to underwrite buyer risks for our corecredit insurance business. They also support our customers with businessintelligence solutions that can help customers to manage risk and growtheir business.
Through these companies we are able to offer our customers a range ofbusiness information solutions which can help them to make smart businessdecisions in several areas of their business including: credit management,risk and compliance and marketing.

15

Business
intelligencesolutions that canhelp customers
to manage risk
and grow theirbusiness.

Atradius  |  Business profile Atradius N.V.

Global footprint
EuropeAustria
Belgium
Bulgaria
Czech Republic
Denmark
FinlandFranceGermany

ViennaNamur, Antwerp
Sofia
PragueCopenhagen, Århus
Helsinki
Paris, Bordeaux, Compiègne, Lille, Lyon, Marseille,
Rennes, Strasbourg

GreeceHungary
Iceland
Ireland
Italy
Luxembourg
Netherlands
NorwayPolandPortugal
Romania
RussiaSlovakia
Spain

Cologne, Berlin, Bielefeld, Bremen, Dortmund,Düsseldorf, Frankfurt, Freiburg, Hamburg, Hanover,
Kassel, Munich, Nuremberg, Stuttgart
Athens
Budapest
Reykjavik (1)DublinRome, Milan
Luxembourg
Amsterdam, Ommen
Oslo
Warsaw, Krakow, Poznan, Jelena Gora
Lisbon, Porto
Bucharest
Moscow
Bratislava
Madrid, Alcalá de Henares, Alicante, Barcelona, Bilbao,
A Coruña, Castellón, Girona, Las Palmas de Gran
Canaria, Málaga, Murcia, Oviedo, Pamplona, Seville,
Tarragona, Terrassa, Valencia, Zaragoza

SwedenSwitzerland
TurkeyUnited Kingdom

Stockholm
ZurichIstanbul
Cardiff, Belfast, Birmingham, London, Manchester

Middle East
IsraelLebanonSaudi Arabia
United ArabEmirates
Americas
Argentina
BrazilCanadaChile
MexicoPeru

Tel Aviv (1)Beirut (1)Riyadh (1)Asia

Dubai (1)
Buenos Aires (1)São Paulo
Almonte (Ontario), Mississauga (Ontario), Pointe Claire(Quebec)
Santiago de Chile (1)Mexico City, Guadalajara, Monterrey
Lima (1)USA	
Baltimore (Maryland), Carmel (Indiana), Chicago (Illinois), Elk
Grove (California), Hallendale Beach (Florida),Irvine, California,
Los Angeles (California), Morristown (New Jersey), New York(New York), Plano (Texas)

16

China	Beijing, Guanzhou, Nanjing,
Shanghai (2)Hong Kong
Hong Kong
India
Mumbai, New Delhi, Kolkata (2)Indonesia
Jakarta (2)
Japan
Tokyo
Malaysia
Kuala Lumpur (1)Philippines
Manila (1)Singapore
Singapore
South Korea
Seoul (2)TaiwanTaipei (1)Thailand
Bangkok (2)VietnamHanoi (1)AfricaKenya
South Africa
Tunisia

Nairobi (1)Johannesburg (1)Tunis (1)Oceania
Australia	Sydney, Brisbane, Melbourne, Perth
New Zealand
Auckland17(1)

 ssociated company, minority interest orA
co-operation agreement with local partner(2)

 ervice establishment and co-operation
Sagreement with local partner

Atradius  |  Business profile Atradius N.V.

Atradius Group
organisation
General overview as at 31 December 2017

Atradius N.V.
The Netherlands

Atradius Collections
Holding B.V.
The Netherlands

Atradius Insurance
Holding N.V.
The Netherlands

Atradius Collections
operating companies
and branches

Atradius Crédito y
Caución S.A. de Seguros y
Reaseguros
Spain

Office locations:
Australia
Indonesia
Belgium
Ireland
BrazilItaly
CanadaMexicoNetherlands
China
Czech Republic Poland
Denmark
Spain
FranceSingapore
Germany
TurkeyHong Kong
United Kingdom
USA
Hungary

Atradius Finance B.V.
The Netherlands

Atradius Crédito y Caución
Seguradora S.A.
Brazil
Iberinform Internacional S.A.u.
Spain

Atradius Investments Ltd.
IrelandBranches:
Australia
Japan
Austria
Luxembourg
Netherlands
Belgium
Bulgaria
New Zealand
NorwayCanadaCzech Republic Poland
Denmark
Portugal
Romania
FinlandFranceSingapore
Slovakia
Germany
SwedenGreeceHong Kong
Switzerland
Hungary
TurkeyUnited Kingdom
Ireland
Italy

Atradius Reinsurance DAC
IrelandAtradius Trade Credit
Insurance Inc. USA
Atradius Credit Insurance
Agency Inc. USA

Atradius Seguros
de Crédito S.A. Mexico
Operating companies& branches:

Atradius Rus Credit
Insurance LLC Russia

Belgium
China
Denmark
FranceGermany
India
Indonesia
Ireland
Italy
Japan

Atradius Information
Services B.V.
The Netherlands
Atradius Dutch StateBusiness N.V.
The Netherlands

MexicoNorwayRussiaSouth Korea
Spain
SwedenSwitzerland
Thailand
United Kingdom

Graydon Holding N.V.
The Netherlands
Office locations:

Graydon operatingcompanies

Belgium
Netherlands
United Kingdom

18

Atradius Participations
Holding B.V.
The Netherlands
Atradius
Participations

Connected to people

19Atradius | Corporate Governance Atradius N.V.

Report of theSupervisory Board
After the slow pace in 2016, the global economy strengthened in 2017. Bothemerging markets and advanced economies have improved their growth rate.
The US economy continues with its robust recovery while also all Eurozone
economies grew, although not evenly distributed among all member states.
Domestic demand remained the pillar of growth in 2017. Private consumption
growth was underpinned by rising employment, low inflation and strong
sentiment while the unemployment rate declined further in 2017. For Emerging
markets, China’s higher domestic demand and exports resulted in higher growth
while also Russia, Brazil and Argentina emerged from their previous recessions.
Global growth is also expected to pick up slightly in 2018, keeping good
economic prospects in practically all countries. While the economic outlook is
promising, political risk challenges still may affect stability. The evolution of
the negotiation of the Brexit will be an element of special sensitivity for theEuropean Union and, particularly, for United Kingdom.
In 2017, world trade has experienced a greater than expected expansion,
growing above 4.0% in recent months. In the United States, it increased by 3.3%
while the Eurozone grew by 2.6%. It is especially noticeable the growth of 6.3% in
Asia Pacific. Global export orders, which is another leading indicator, have also
remained firm. As a result, the forecast of insolvencies at a global level showsa reduction of 3% in 2017; looking forward, conditions are expected to easefurther, supporting a more stable insolvency outlook in 2018.
In 2017 Atradius once again achieved strong results. The profit for the year
was EUR 186.2 million which was supported by a 2.0%increase in insurance
revenue compared to 2016. Also risk acceptance remained high in 2017 at
41.7% claims ratio by successfully managing claims costs in a challenging risk
environment. The shareholder’s equity and subordinated debt position was
further strengthened by 6.6% resulting from profit generation.
During the year, Atradius undertook several initiatives to improve its service
offering and product development to maintain and enhance its strong value
proposition to its customers. In 2017 multi-year projects were started to enhance
Atradius’ core systems leveraging on the latest technology to deliver excellent
digital experience to customers, partners and staff. For our staff this will include
best-in class applications for policy and buyer underwriting, fully automatedand globally accessible via mobile devices. For our customers this will include
easier ways to connect with us to reduce the time needed to administer theirpolicy. For our partners this will include new and more efficient ways to share
information so that our services can be more easily integrated.
Atradius is also using technology to innovate in credit management with theaim to integrate some of the digitalization opportunities like platforms, big data,advanced analytics and robotics into our core business. In particular, in 2017 thestate of the art on-line customer portal Atrium was launched.

20

In 2017 Atradius
once again
achieved strong
results.

Atradius | Corporate Governance Atradius N.V.

Atradius continues to enhance its diversification also in 2017 by acquiring the
25% of Credit Guarantee Insurance Corporation of Africa Ltd., based in South
Africa, opening new offices in Bulgaria and Romania, expanding the bonding
segment to Germany and France and beginning collections activity in China
and India.
In the course of 2017 Grupo Catalana Occidente in-house ‘Partial Internal
Model’ for calculating regulatory capital under Solvency II was approvedby the College of Regulators. This reinforced our risk management and risk
quantification. In particular, the solvency ratio of Atradius at the end of 2017is well above 200%.
In 2017, the full Supervisory Board convened five times, the Audit Committee
five times, while the Remuneration, Selection and Appointment Committee
convened three times.
As in previous years, both the Management Board and the Supervisory
Board participated in Atradius’ annual Permanent Education Programme.
In 2017 this programme covered, amongst other topics: New developmentsin the financial/insurance industry (incl. Big Data, Fintech & Blockchain),
Cybercrime and Cybersecurity. The Supervisory Board was also involved in
the review of the Remuneration Policy.
With effect from 1 January 2018 Messrs. Bernd-Hinrich Meyer and Francisco
Arregui and Mrs Désirée van Gorp were reappointed as member of theSupervisory Board.
Atradius N.V.’s Annual Report contains the financial statements for thefinancial year 2017, audited by Deloitte Accountants B.V., and has beenpresented to the Supervisory Board by the Management Board. The
Supervisory Board has approved the Annual report and advised the General
Meeting to adopt the financial statements for 2017.
The Supervisory Board would like to thank the Management Board and all
Atradius employees for the excellent results achieved in 2017 as well as all
customers for continuing to trust their business to us. Finally, the Supervisory
Board is confident that the Atradius management team and employees willcontribute to another successful year in 2018.
Ignacio Álvarez
Chairman21

The solvency ratioof Atradius at theend of 2017 is well
above 200%.

Atradius | Corporate Governance Atradius N.V.

Shareholder structure
Atradius is part of Grupo Catalana
Occidente. It is the international brandof the credit insurance business.
Shareholder structure of Atradius N.V., since 2011:
Shareholder structure of Atradius N.V.

Percentage ofShares

Grupo Catalana Occidente, S.A.

35.77%

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

64.23%

Grupo Catalana Occidente, S.A.

73.84%

Consorcio de Compensación de Seguros

9.88%

Nacional de Reaseguros

7.78%

España, SA Compañía nacional de Seguros

5.00%

Ges Seguros y Reaseguros

3.50%

Total

100.00%

Grupo Catalana Occidente is the main shareholder with an economic stake of 83.2% (35.77% directly and 47.43%
indirectly through the holding Company Grupo Companía Española de Crédito y Caución, S.L.).
The shares of Grupo Catalana Occidente are listed on the Continuous Market of the Barcelona and Madrid
stock exchanges as part of the IBEX Medium Cap Index. Currently, 38% of its capital is floating and the main
shareholder is INOC, S.A., holding 62% of the capital of Grupo Catalana Occidente.
Thanks to the stability of the results and the prudent investment policy, Grupo Catalana Occidente has a solid
solvency position.

Key figures(EUR million)

2017

2016

% change
2016/2017

Long-term capital market value

3,755.5

3,508.5

7.0%

Equity3,078.6

2,834.7

8.6%

Subordinated debt

200.2

204.9

(2.3%)

Return on long-term capital

11.8%

11.7%

Funds under management

11,988.2

11,672.1

Total revenue

4,254.3

4,235.8

0.4%

357.3

324.5

10.1%

Consolidated result

22

2.7%

Atradius | Corporate Governance Atradius N.V.

Grupo Catalana
Occidente
One of the leaders in the Spanish insurance sector and in global credit insurance. Founded more than 150 years ago, it
has experienced constant growth, thanks to its capacity to adapt to change and remain loyal to its principles, which are
truly insurance oriented.
Grupo Catalana Occidente is committed to the professional development of its employees and insurance agents, its
personalised customer service and the trust its shareholders have in the organisation.

More than
19,000 insurance
brokers

More than
1,600 branches

Presence inmore than 50
countries

More than
7,300 employees

More than€4,200 million
turnover

Strategic goal
To be leaders in the field of risk protection and long-term savings of families, as well as that SMEs, and to beinternational leaders in commercial risk coverage.

Profitability

GrowthRecurrent and sustained profitability
based on technical and actuarial
rigour, investment diversificationand processes that allow tight cost
ratios and quality service.

Defining markets targeted by
the Group, appropriate productand service development andestablishing suitable distribution
channels to reach the customer.

Solvency
Prioritise own resources generation andcontinued growth in order to support theGroup’s expansion, ensuring compliancewith commitments and ensuring appropriate
shareholders returns.

23

Atradius | Corporate Governance Atradius N.V.

Traditional BusinessCharacteristics

Lines of Business

Focused on Spain

Multi-risk

Families and small and medium sizedcompanies

Automobile

Professional agency network

Other non-life

1,405 offices

Life and financial products
HealthFuneralCredit Insurance
Business

Service offered in more than 50 countries

Credit insurance

Companies

Bonding

Agents and brokers

Credit and bonding reinsurance
Debt collection
Instalment credit protection
Business information

Fundación Jesus Serra
Fundación Jesús Serra, named after the founder of the Grupo Catalana
Occidente, was created in 2006 in order to channel the philanthropic actionsof the Group and to drive the human and professional values that werecharacteristic of its founder. For this reason, the foundation participates inmore than seventy projects in the areas of business, teaching, investigation,
culture, sport and social action. In this way the Group contributes to theconstruction of a fairer, more united and more developed society, in which
values such as initiative, effort, healthy competition and continuous
improvement prevail.

24

Atradius | Corporate Governance Atradius N.V.

Building trust
Atradius endorses the importanceof sound corporate governance.
Key elements of independence,accountability and transparency createa relationship of trust between Atradius
and all of its stakeholders.
Atradius N.V. is a limited liability company organised under the laws of
the Netherlands with a Management Board and a Supervisory Board. The
Management Board is responsible for achieving the Company’s objectives,
strategy, policy and results and is guided by the interests of the Company
and the business connected with it. The Supervisory Board supervises theCompany’s general affairs and the policy pursued by the Management Board
as well as the performance of the management duties by the Management
Board members, taking into account the interests of the Company and thebusiness connected with it.

The Management Board
Composition
The Management Board of Atradius N.V. currently consists of five members.
Isidoro Unda - Chairman and Chief Executive Officer
Andreas Tesch - Chief Market Officer
Christian van Lint - Chief Risk Officer
Claus Gramlich-Eicher - Chief Financial Officer
Marc Henstridge - Chief Insurance Operations Officer
CVs of each of the Management Board members, showing their roles,
background and experience are available on our website.
Role and procedures
The Management Board as a whole is responsible for the management andthe general affairs of Atradius and is supervised by the Supervisory Board.
The Management Board determines Atradius’ operational and financial
objectives, and the strategy designed to achieve these objectives, and ensuresthat Atradius has in place an effective risk management system, internal
control system and internal audit function. The annual business plan andbudget of Atradius are submitted to the Supervisory Board for approval. The
Management Board rules describe the (allocation of) duties and the decision
making process of the Management Board.

25

Atradius | Corporate Governance Atradius N.V.

The General Meeting has the authority to appoint the members of theManagement Board on the recommendation of the Remuneration, Selection
and Appointment Committee of the Supervisory Board. A Management Board
member may be suspended or dismissed by the General Meeting at any time.
The Management Board shall consist of at least three members. Management
Board members are appointed for an undefined term. In the event of avacancy, the management of Atradius N.V. will be conducted by the remaining
members or sole remaining member of the Management Board.
Remuneration
The Supervisory Board determines the remuneration and further
employment conditions of each member of the Management Board, basedon the recommendation of the Remuneration, Selection and Appointment
Committee of the Supervisory Board and in accordance with the
remuneration policy adopted by the General Meeting. Information regarding
the amount of remuneration received by Management Board members can befound in the explanatory notes to the consolidated financial statements of theAnnual Report 2017.
Conflict of interest
A member of the Management Board with a potential conflict of interest
with the Company will immediately report this to the Chairman of theManagement Board who will determine whether the reported case qualifies asa conflict of interest. A member of the Management Board will not participate
in any deliberations or decision-making process of the Management Board
if such member of the Management Board has a direct or indirect personal
interest which conflicts with the interest of the Company or its business. In
such case the other non-conflicted members of the Management Board willpass the resolution. If all members of the Management Board are conflicted,
then the Supervisory Board will pass the resolution.

26

Atradius | Corporate Governance Atradius N.V.

The Supervisory Board
Composition
The Supervisory Board of Atradius N.V. currently consists of ten members.
Ignacio Álvarez, Chairman
Francisco Arregui, Vice-Chairman
Bernd H. Meyer
Dick Sluimers
Xavier Freixes
Hugo Serra
Désirée van Gorp
John Hourican
Carlos Halpern
José María Sunyer
CVs of each of the Supervisory Board members, showing their backgroundand experience are available on our website.
Role and procedures
The Supervisory Board supervises the Company’s general affairs andthe policy pursued by the Management Board. The responsibilities of theSupervisory Board include, among others, supervising, monitoring andadvising the Management Board on the Company’s strategy, performance andrisks inherent to its business activities; the design and effectiveness of theinternal risk management and control systems and the financial reporting
process. The Supervisory Board rules describe the decision-making process
and the composition and committees of the Supervisory Board.
The General Meeting has the authority to appoint the members of theSupervisory Board on the recommendation of the Remuneration, Selection
and Appointment Committee of the Supervisory Board. A Supervisory Board
member may be suspended or dismissed by the General Meeting at any time.
The Supervisory Board shall consist of at least five members. Supervisory
Board members shall resign according to a rotation scheme determinedby the Supervisory Board pursuant to which each Supervisory Board
member shall resign after a maximum period of four years, after the date of
appointment. A resigning Supervisory Board member may be reappointed.
A Supervisory Board member will resign early in the event of inadequate
performance or in other circumstances in which resignation is deemednecessary by the other members of the Supervisory Board.
The composition of the Supervisory Board
The composition of the Supervisory Board shall be such that the
combined experience, expertise and independence of its member enables
the Supervisory Board to best carry out its various responsibilities. The
current members of the Supervisory Board have extensive experience ininsurance and reinsurance, investment banking, strategic consulting andregulatory matters.

27

Atradius | Corporate Governance Atradius N.V.

Role of the Chairman and the Company Secretary
Among other things, the Chairman of the Supervisory Board co-ordinates
the decision making of the Supervisory Board, draws up the agenda of theSupervisory Board meetings, chairs the Supervisory Board meetings and theGeneral Meetings of Shareholders, ensures the adequate performance of theSupervisory Board and its committees, ensures the annual evaluation of thefunctioning of the members of the Management Board and the Supervisory
Board, and acts on behalf of the Supervisory Board in serving as the principal
contact person for the Management Board. The Chairman of the Supervisory
Board is assisted in his role by the Company Secretary.
Committees of the Supervisory Board
The committees of the Supervisory Board are set up to reflect both the Dutch
corporate standards and the specific interests of the business of Atradius.
As risk management is considered to be a key area for attention, theSupervisory Board considers it important that this subject is discussed by
the full Supervisory Board, rather than in a specific risk committee. All risk
subjects dealt with in meetings of the Supervisory Board are chaired by
Bernd H. Meyer.
Audit Committee
The Audit Committee supports the Supervisory Board in fulfilling its
supervisory and monitoring duties with respect to the assurance of theintegrity of the Company’s financial statements, the external auditor’squalifications, and the performance of internal and external auditors. The
Audit Committee monitors, independently and objectively, the financial
reporting process within Atradius and the system of internal controls. The
Audit Committee also facilitates the ongoing communication between theexternal auditor, the Management Board, the internal audit department andthe Supervisory Board on issues concerning the Company’s financial position
and financial affairs. In 2017, the Audit Committee met five times. The Audit
Committee currently consists of Xavier Freixes (Chairman), Francisco Arreguiand Dick Sluimers.

Remuneration, Selection and Appointment Committee
The Remuneration, Selection and Appointment Committee supports theSupervisory Board in fulfilling its supervisory and monitoring duties withrespect to proposals for the appointment of members of the Management
Board and the Supervisory Board, the remuneration policy, the remunerationof senior management and other corporate governance matters. In 2017, theRemuneration, Selection and Appointment Committee met three times. The
Remuneration, Selection and Appointment Committee currently consists ofFrancisco Arregui (Chairman), Ignacio Álvarez and Hugo Serra.
Remuneration
The General Meeting determines the remuneration of the members of theSupervisory Board based on the recommendation of the Remuneration,
Selection and Appointment Committee and in accordance with the
remuneration policy adopted by the General Meeting. Members of theSupervisory Board are reimbursed for their expenses. Information regarding
the amount of remuneration received by Supervisory Board members can befound in the explanatory notes to the consolidated financial statements of theAnnual Report 2017.

28

Atradius | Corporate Governance Atradius N.V.

Conflict of interest
A member of the Supervisory Board with a potential conflict of interest
with the Company will immediately report this to the Chairman of theSupervisory Board who will determine whether the reported case qualifies asa conflict of interest. A Supervisory Board member will not participate in any
deliberations or decision-making process of the Supervisory Board, if such
Supervisory Board member has a direct or indirect personal interest whichconflicts with the interest of the Company or its business. In such case theother non-conflicted Supervisory Board members will pass the resolution. If
all Supervisory Board members are conflicted as referred to above, then the
General Meeting will pass the resolution.
General Meeting
The General Meeting is the body of the Company formed by the shareholders
and other persons entitled to vote. The General Meeting can exercise its rights
at the General Meeting of Shareholders. The General Meeting is also authorised
to approve important decisions regarding the identity or character of Atradius,
as well as major acquisitions and divestments.

The internal and external auditor
Internal auditor
The internal auditor fulfils an important role in assessing and testing theinternal risk management and control system. The Director of Internal Audit
reports to the Chairman of the Audit Committee and, with respect to day-to-day
activities, to the Chief Executive Officer of Atradius.
External auditor
The General Meeting appoints the external auditor on the recommendationof the Audit Committee of the Supervisory Board. The Audit Committee
evaluates the performance of the external auditor and also pre-approves
the fees for audit and permitted non-audit services to be performed by theexternal auditor. The Audit Committee ensures that the external auditor is notappointed to render non-audit services that are listed explicitly as prohibited
services in the Atradius Compliance Code on Auditor Independence.
The General Meeting appointed Deloitte Accountants B.V. as the Company’s
external auditor for the financial year 2017 on 13 June 2017.

29

Connected through technology

30

Atradius | Consolidated management report

The global economic
environment in 2017
Global growth strengthens
The global economy strengthened in 2017, with higher growth rates in both
emerging markets and advanced economies. Global growth rose to 2.9% in 2017,
up from 2.4% in 2016 and is expected to increase further (to 3.2%) in 2018.

Advanced markets
Growth in advanced markets improved in 2017. Eurozone recovery
strengthened to 2.4%, with private consumption, investment and external
demand bolstering growth. Domestic demand remained the pillar of growth for
the Eurozone in 2017. Private consumption growth was underpinned by rising
employment, low inflation and strong sentiment. The unemployment rate
declined further in 2017, to 8.7% in November 2017, compared to 9.6% at the startof the year.
All member states’ economies grew last year. Still, Eurozone growth continues
to be unevenly distributed, with Southern European member states lagging
behind their Northern European counterparts. Spain is the clear exception inSouthern Europe: for the third consecutive year it showed robust economic
expansion, with 3.1% GDP growth in 2017.
Financial conditions remained very loose in 2017. Low interest rates kept
funding costs for companies low and made it relatively cheap for consumers
and firms to borrow. As a result, borrowing in the Eurozone continued torecover in 2017, with banks relaxing their credit conditions, making it easier
to obtain loans. Southern Europe remained a weak spot in bank lending, asbanks still have to cope with still weak balance sheets and high levels of nonperforming loans.
The US economy experienced robust recovery in 2017, with GDP growth coming
in at 2.3%. Private consumption, which accounts for more than two-thirds of the
US economy, remained the primary growth driver. Labour market conditions
continued to improve and the unemployment rate was at 4.1% in December
2017, below the previous 2007-low.
Global economic growth

Real GDP growth, percent change y-o-y31Eurozone growthcontinues tobe unevenly
distributed.

Atradius | Consolidated management report

Emerging Markets
Emerging market growth strengthened in 2017. China’s growth went up anotch in 2017 as a result of higher domestic demand and exports, supported
by accommodative policy. Also, some of the largest emerging markets (Russia,
Brazil and Argentina) emerged from their 2015-2016 recessions.
The emerging world benefitted from a cyclical recovery in global trade.
Trade expanded particularly in emerging Asia and Latin America. Declining
policy uncertainty in the US has benefitted Latin American countries. Mexico
maintained growth momentum, despite uncertainty related to NAFTA
negotiations and significant tightening of monetary policy. Brazil andArgentina emerged from their 2015-2016 recessions, helped by structuralreforms and the increase in commodity prices. In Eastern Europe, the higher
oil price lifted Russia from its recession. Trade growth rose in emerging Asia
due to higher import demand from China.
As monetary policy in the advanced world remained very accommodative,
financial conditions in emerging markets have remained supportive of
economic activity. Moreover, net importers of commodities such as oil, steel
and coal benefitted from another year of relatively low prices, providing
stimulus to domestic demand. Among these net importers are many Latin
American countries.
Growth in Central and Eastern Europe strengthened due to the positive effectof the Eurozone recovery which translated into higher exports and more
inward investment, as well as re-emerging growth in Russia.
Global commodity prices
Price index, 2010 = 10032

The emerging
world benefitted
from a cyclicalrecovery in global
trade.

Atradius | Consolidated management report

Cautious decline in insolvencies
Global insolvencies declined slightly in 2017, as the world economy continued
to build momentum. The strongest improvement is seen in Eurozone
countries, like the Netherlands, and some of the southern European countries(Portugal, Italy) which are recovering from high insolvency rates. Credit
conditions for businesses generally improved across advanced markets
in 2017. However, insolvency levels remained elevated in many Eurozone
countries – especially in southern Europe – and financial conditions were still
far from the pre-2008 benign environment.
Other advanced markets generally faced improving conditions as well.
US insolvencies declined on the back of another year of robust growth.
Insolvencies have started to pick up again in the UK due to reduced growthlevels as a result of Brexit uncertainty. In most other advanced markets,
strengthening domestic demand and higher exports have pushed up GDP
growth rates, leading either to stable or declining insolvencies.
Growth picked up slightly in most emerging markets in 2017, producing aslightly more benign insolvency environment. Insolvencies are forecast to
decline in India, Brazil and South Africa because these are countries thatwill benefit from increasing economic growth. Other emerging markets
are expected to see a rise in insolvencies in line with the poorer economic
conditions. In China, insolvencies have increased in 2017 as companies havebeen impacted by worsening funding conditions. Turkey saw a steep increase
in insolvencies due to high inflation and lira volatility.

Outlook for 2018
Global growth is expected to increase momentum in 2018. Across emerging
markets growth is expected to pick up helped by a mild recovery incommodity prices. In Latin America, the economic recovery is expected tocontinue this year, with a higher growth rate for Brazil and Argentina, andstable growth for Mexico. However, a possible breakdown of the NAFTA
negotiations remains a sizeable downward risk for Mexico. In Eastern Europe,
growth is expected to moderate slightly next year. Asian growth, supported byIndia and China, will continue to fuel the engine of global growth.
Despite this positive outlook, emerging markets may endure some financialpressure from US monetary policy tightening. Advanced markets are
expected to maintain their growth rate. Eurozone growth is expected to coolslightly in 2018, resulting from lower export and consumption growth. US
growth is forecast to continue in 2018 as a result of fiscal stimuli.
For advanced markets as a whole, the business environment is expected
to remain more or less stable with no significant changes to insolvencies.
Financial conditions are expected to remain accommodative, despite
US monetary policy tightening and the gradual scale-back of the ECB’s
bond-buying programme. The UK is expected to see the strongest rise in
insolvencies, as uncertainty surrounding the negotiations with the EU andadverse effects from the weak pound will really impact next year. This will
also have moderate negative spill-over effects on other EU countries.

33

Financialconditions werestill far from thepre-2008 benign
environment.

Atradius | Consolidated management report

Stable and profitable
growth(EUR thousands)

2017

2016

1,718,925

1,684,984

2.0%(717,228)(701,147)(2.3%)(612,910)(612,682)(0.0%)

Reinsurance result(133,683)(140,062)

4.6%

Insurance result

255,103

231,093

10.4%

Service income (1)121,056

78,43854.3%

Service expenses(116,016)(70,517)(64.5%)

Insurance revenue
Gross insurance claims and loss adjustment expenses
Gross insurance operating expenses

(1)

(1)

Service result

5,040

7,922

(36.4%)Net investment result (2)24,726

22,761

8.6%

Operating result before finance costs

284,870

261,775

8.8%

Result for the year (after tax)

186,236

211,772(12.1%)

3,596

3,586

0.3%

Employees (FTE)(3)

Overview includes inter-segment revenue and (claims) expenses.
	Net income from investments excluding extraordinary impact from associated companies(minus EUR 11.7 million impairment in 2017, and EUR 22.2 million of realised gains in 2016).
(3)
Including FTE from Graydon, Iberinform Portugal, Gestifatura and Informes.
(1)

(2)

Gross
2017

Net
2016

2017

2016

Claims ratio

41.7%

41.6%

41.4%

42.0%

Expense ratio

35.7%

36.4%

34.2%

35.4%

Combined ratio

77.4%

78.0%

75.5%

77.4%

Revenue by business segment

6%
7%

7%
80%

Credit Insurance (including ICP)
Reinsurance
BondingServices34

Atradius | Consolidated management report

In 2017 Atradius once again achieved strong results. The insurance result
increased by an outstanding 10.4%. The net investment result increased by
8.6% in 2017 (excluding extraordinary impacts from associated companies)
which led to the operating result growing by 8.8%.
Despite the excellent operating result, the result for the year 2017 decreasedby 12.1% purely driven by the extraordinary impacts of associated companies(Minus EUR 11.7 million impairment in 2017 and EUR 22.2 million of realised
gains in 2016.)
The profit for the year of EUR 186.2 million was supported by a 2.0% increase
in insurance revenue compared to 2016. Gross claims were at EUR 717.2
million (2.3% above 2016) while gross insurance expenses remained in linewith the previous year at EUR 613 million. The gross combined ratio, ended at
an excellent 77.4%.
The credit insurance business performed well in 2017, despite reduced
premiums in Southern Europe. The performance in Spain, which is our largest
credit insurance market, continues to show strong activity and increasing
volumes of insured turnover, although price pressure has impacted premiums
driven by the competitive environment.
The markets in North America, Asia and Central and Eastern Europe showedstrong revenue growth, in line with our ambition to expand in these regions.
Claims costs in 2017 saw an inflow that was both moderate and stable.
The Global unit performed well with an increase in revenue whilst Special
Products experienced a marginal decline. Both units however experienced asignificant reduction in claims compared to 2016. For Bonding revenue grewin 2017 and the result remained excellent with a claims ratio of 18.6%. Also for
Reinsurance revenue increased slightly in 2017 and the claims ratio recoveredfrom 70.1% in 2016 to 57.9% in 2017.
The Atradius gross insurance operating expenses in 2017 amounted to EUR
612.9 million with the cost ratio of 0.6 percentage points lower compared to2016. Brokerage fees increased by 1.4% compared to 2016, however this is 0.6
percentage points less than the growth ratio of insurance revenue.
The reinsurance of the Group remained under a single quota share contract
with the retention remaining at 57.5%, in line with 2016. The cost ofreinsurance in 2017 was EUR 133.7 million, a decrease of EUR 6.4 million
compared to 2016, largely a result of higher reinsurance commission.
Services achieved a positive result of EUR 5.0 million this year, showing
positive performance in all businesses with the exception of Graydon which
was impacted by one-off expenses. Our Collections unit saw a positive
development in service income as a result of growth in market share of our
non-insured collections products and the improving insolvency environment
in Western Europe.
The net investment result contributed positively to the bottom line. Excluding
extraordinary impact of associated companies, the net investment result
increased by 8.6% compared to 2016.

35

North America,
Asia and Central
and Eastern
Europe showedstrong revenue
growth.

Atradius | Consolidated management report

Credit Insurance including Instalment Credit Protection (ICP)(EUR thousands)
Insurance premium revenue

2017

2016

1,341,173

1,316,365

1.9%

Information income

130,830

127,396

2.7%

Insurance revenue

1,472,003

1,443,761

2.0%

Gross insurance claims and loss adjustment expenses (1)(618,736)(600,704)(3.0%)

Gross insurance operating expenses(509,929)(501,364)(1.7%)(1)

Result before reinsurance

343,339

341,693

0.5%

Reinsurance result(108,898)(113,341)

3.9%

Result after reinsurance

234,441

228,352

2.7%

42.0%

41.6%

(1.0%)

Total credit insurance and ICP gross claims ratio(1)

Overview includes inter-segment reclassifications

Credit insurance & ICP revenue by region
8.4%
8.9%

23.1%

Spain & Portugal
Northern & Central Europe

7.0%Western Europe
Southern Europe
Asia

22.2%
30.3%

AmericasCredit insurance is Atradius’ core product in terms of premium. It iscompromised of traditional credit insurance for both domestic and export
trade and the structured credit and political risk business of our Special
Products team.
The global economy is continuing to strengthen. Worldwide growth isexpected to increase 3.2% in 2018.
The outlook for emerging markets was brighter than in 2016, as Brazil,
Argentina and Russia emerged from recession and access to financeremained favourable. Many markets benefitted from the elevated commodity
prices. Financial markets’ perception of emerging economies is increasingly
positive, but countries with high external liabilities remain vulnerable.
While the global economic outlook is more robust than previous years,
political risk remains a downside risk to stability. The Eurozone economy
has benefitted in 2017 from a pick-up in global activity, driven largely by
emerging markets and some advanced markets. Despite the pick-up in global
activity, Eurozone growth largely came from domestic demand. Consumer
and business confidence indicators remain strong. The US economic outlook
is steady with GDP growth driven primarily by consumer spending, supported
by low interest rates and the tightening labour market. The UK economy has
been resilient in the aftermath of the Brexit vote but GDP growth is beginningto ease.

36

The outlook for
emerging markets
was brighter thanin 2016.

Atradius | Consolidated management report

Atradius’ credit insurance business showed consistent performance in 2017,with a result before reinsurance of EUR 343.3 million, 0.5% higher than in
2016. Insurance revenues reported a 2.0% increase compared to 2016 (2.7%
at constant foreign exchange rates). Claims inflow remained under control.
Claims expenses increased slightly in 2017, moderately by a small numberof larger cases. This increase in claims however resulted in higher recoveries
from claims ceded to reinsurers. Credit conditions were supportive in Europe
and finally improving in emerging markets. The insolvency outlook has also
been favourable overall with the exception of Spain which continues to bestable. Gross insurance operating expenses increased by 1.7%, at a lower level
than the development in insurance revenues.
The global economy is still influenced by uncertainty. Against thisbackground, we continued to provide cover to our customers around theworld. Our total potential exposure (TPE) in 2017 increased by 6.1% to EUR
622.8 billion. The top three regions for exposure concentration did not change
compared to 2016 with Europe accountable for 72.7% of the exposure, Asia for
13.8% and the Americas 12.4% of the total exposure.
In relative terms, the region with the highest concentration (Europe) is also
the region where exposure grew the most (up 6.8%). Other regions with highgrowth were Oceania (5.9%) and Asia (6.6%) but all buyer regions contributed
to the increase in exposure. In North America the increase was marginal(1.0%). In China, our exposure increased substantially, a result of the steadydomestic economic rebalancing.
The concentration of exposure by trade sector remained fairly stable. 76.8% of
the Group’s TPE is in seven trade sectors: chemicals, construction, consumer
durables, electronics, food, metals and transport. In 2017 our exposure
increased most notably in agriculture and construction due to increased
business levels of existing and new customers.
Our initiatives to meet customers’ needs were rewarded with improved
customer retention. Overall our credit insurance portfolio reported moderate
growth of 2.0%.
Germany, one of our larger markets within Europe, delivered an increase
in revenues of 3.8% compared to 2016. The United Kingdom & Ireland on
the other hand showed a decrease in revenue of 1.5%. However at constantforeign exchange rates revenue grew by 8.2%. France and Italy showed
moderate increases in revenue of 1.3% and 1.5% respectively, while Belgium &Luxembourg grew by 1.9% and the Netherlands by 2.9%.
Revenue growth between 6.8% and 7.3% was observed in the Nordic region
and Central & Eastern Europe while revenue grew even more significantlyin Asia and NAFTA by 11.6% and 10.0% respectively. In Oceania revenue grewby 4.5%. In Spain revenue decreased by 7.9%, impacted by price pressure in acompetitive environment.
Gross claims expenses of local credit insurance ended at EUR 423.8 million,
a 10.6% increase compared to 2016. In Asia the claims ratio increased by 3.4
percentage points while both our Global and Special Products units improved
substantially.

37

The global
economy is stillinfluenced byuncertainty.

Atradius | Consolidated management report

Our Global unit represents a significant part of our total credit insurance
revenue and is the acknowledged market leader in the multinationalcustomer segment of the credit insurance industry. In 2017 the Global
unit celebrated its 20th anniversary and is proud to be the pioneer for a
multinational approach in the industry. The ongoing success of Global once
again affirms the importance of having a separate unit dedicated to providing
solutions to the multinational segment.
Our Special Products Unit (SPU) offers solutions outside the framework of ourwhole turnover policies, to cover the non-performance of trade transactions
and of the related financing. In 2017 SPU has delivered stable revenues and adecrease in claims, combined with an increase in recoveries
Instalment Credit Protection (ICP) covers the medium- and long-term risks
that financial and corporate policyholders face in their multiple instalment
agreements with private individuals and businesses. In 2017 insurance
revenue increased. The claims ratio remained exceptionally low at 1.7% thanks
to above-target recoveries.
In 2017 Atradius started a company wide multi-year programme, named
Credit Insurance Business Transformation, focused on enhancing ourbusiness processes, modernising our IT systems and strengthening ourvalue proposition. Our goal is to redesign our core company processes andapplications, and how we interact with our customers, distribution channels
and cooperation partners in the coming years. Our first focus area will be thecommercial processes.

38

Enhancingour businessprocesses,
modernising our
IT systems andstrengthening ourvalue proposition.

Atradius | Consolidated management report

Reinsurance(EUR thousands)

2017

2016

Insurance revenue

133,697132,024

1.3%

Gross insurance claims and loss adjustment expenses(77,452)(92,542)16.3%

Gross insurance operating expenses(54,840)(54,927)

0.2%

Result before reinsurance

1,405(15,446)

109.1%

Reinsurance result

(592)

2,865

(120.7%)813(12,581)106.5%

57.9%

70.1%

17.4%

Result after reinsurance
Gross claims ratio

Reinsurance revenue by region of cedent
0.6%
23.0%

14.4%
3.8%
15.4%

Spain & Portugal
Northern & Central Europe
Western Europe
Southern Europe
Asia

42.8%

Americas

Atradius Re provides reinsurance capacity for primary insurance companies
from both the developed and developing credit insurance and bonding
markets and assumes business from over 60 countries. The underlying
business consists of around 60% credit insurance and 40% bonding, based onpremium volume. The business is underwritten by an international team ofunderwriters based in our offices in Dublin, Ireland.
Atradius Re has long-standing relationships with its clients and leads morethan one third of its treaties, in addition it maintains close contacts withspecialist brokers. The quality of these client relationships is underscoredby the Company’s unique offering: combining our skills in the primary
underwriting of credit insurance and bonding risks with expertise instructuring reinsurance solutions. In this way, Atradius Re can anticipate andrespond to clients’ specific and changing needs. The strategy of Atradius Re
is to diversify and evolve the portfolio by region, country and business type,with a focus on Asia, the Middle East, Africa and Latin America.
The total reinsurance revenue for 2017 of EUR 133.7 million has increasedslightly from EUR 132.0 million in 2016, despite the decision in favour of aproactive strategy towards long-term relationships.

39

Combining
our skills in
the primary
underwriting ofcredit insurance
and bonding risks
with expertisein structuring
reinsurance
solutions.

Atradius | Consolidated management report

Bonding(EUR thousands)

2017

2016

Insurance revenue

113,225

109,199

3.7%

Gross insurance claims and loss adjustment expenses(21,040)(7,901)(166.3%)Gross insurance operating expenses(41,396)(40,885)(1.2%)

Result before reinsurance

50,78960,413(15.9%)

Reinsurance result(24,194)(29,585)

18.2%

Result after reinsurance

26,59530,827(13.7%)

Gross claims ratio

18.6%

7.2%

(156.8%)

Bonding insurance revenue by region
9%

2%
34%

24%

Italy
FranceNordics & Germany
Spain
Other

31%

Atradius Bonding is active in Italy, France, Spain, the Nordic countries(Denmark, Finland, Norway and Sweden), Germany, the Netherlands,
Belgium and Luxembourg.
Atradius Bonding works with different industries and maintains
relationships with a large range of companies. We offer a wide variety of
products closely linked to local legal requirements and tailored to customers’
needs. The products offered can be clustered into two groups of bonds:
contract bonds (bid, performance, advance payment, maintenance) andcommercial bonds (tax, excise, custom and authorisation bonds). Atradius
Bonding is constantly monitoring the markets of its operations, seeking newopportunities and products following legislation changes (e.g. travel bonds).
In addition to the traditional Bonding sectors (such as construction,engineering, capital goods and travel), demand for bonds is growing in
new sectors such as environmental services. Bonding customers show anincreasing need for both domestic services and international bonds support.
To meet customers’ expectations we have expanded our geographic footprint
so that we can also address the international requirements of our domestic
customers. Our expanded presence throughout Europe allows us to support
our customers’ multinational activities, combined with a wide network offronters across the world.
Moreover, our active response to the innovation of the insurance sector and,in particular to the bonding market, means we provide an advanced web
solution to support our customers in handling their bonds efficiently while atthe same time maintaining a pioneering catalogue of products.

40

A wide variety
of products
closely linked
to local legal
requirements
and tailored tocustomers’ needs.

Atradius | Consolidated management reportThanks to our long-standing Bonding expertise, deep local market knowledge
and ability to seize niche market opportunities, we benefit from steady
growth over the last years and the trust of major organisations. This places
us in the peer group of other major surety companies and makes us a leading
bonds supplier in Europe.
Insurance revenue in 2017 amounted to EUR 113.2 million, a 3.7% increase
compared to 2016. The business developed well in Spain, Italy, France andthe Nordic region. Performance in newer markets such as Germany, Belgium,
the Netherlands and Luxembourg has been outstanding and has been an
important driver for growth since 2016. The result is in line with the longterm strategy of the Bonding unit.
The claims ratio evolution in 2017 is satisfactory for all countries with a grossclaims ratio of 18.6%.
In 2017 as part of our innovation programme, we have started to develop acommon Bonding IT platform for customers, partners and staff. This common
platform will help us sustain our market position by providing our customers
with modern customer journeys that bind, enable geographical expansion tocountries where Atradius has a footprint, and support the further expansionof our bonding service portfolio.

41

A leading bonds
supplier in Europe.

Atradius | Consolidated management report

Services(EUR thousands)

20172016 (2)Service income (1)121,056

78,438Service expenses(116,016)(70,517)(64.5%)

5,040

7,922

(36.4%)

Service result
(1)
(2)

54.3%

Overview includes intersegment revenues
Overview includes Graydon, Iberinform Portugal and Gestifatura since Q3 2016.

Service income
37%

Collections
Information
services & ADSB
63%

Atradius’ Services segment is comprised of our debt collection operations,the Dutch State Business and service revenue from our buyer information
businesses.

Debt Collection
2017’s economic climate followed a similar path of consolidation as 2016. The
challenges remained linked to scarce availability of liquidity and low cash
flow levels.
In Western Europe we see indeed that the insolvency environment is
improving. Emerging markets, however experienced another challenging
year. China and Turkey are suffering from a distressed situation which incombination with a slow down of growth rates and an increase of outstanding
debts, creates the ideal environment for a positive development of our activity
in future years. We see local and global companies with a presence in theseregions increasingly asking us to support them there, also for first party
collection services.
Atradius Collections’ service income increased 3.9% in 2017. Debt placement
decreased by 4.0%, mainly as a result of decreased claims. Despite thedecrease in debt placements, we observed an increase of collected sums
which is testament to the improved quality and performance of our local
teams. The positive development of our performance and the underlying
increase in our customer base are providing a positive outlook for further
business development and collections service income generation. AtradiusCollections expanded its reach in 2017 further by establishing service inTurkey and Indonesia.

42

A positive outlook
for further
businessdevelopment.

Atradius | Consolidated management report

Atradius Dutch State Business
Atradius Dutch State Business issues credit insurance policies and guarantees
to Dutch companies and banks financing Dutch exports on behalf of and forthe account of the Dutch State. The technical results for the account of the
Dutch State were positive throughout 2017.
The main activity of Atradius Dutch State Business is to provide cover for
risks related to infrastructure projects and the export of capital goods – often
on medium or long-term credit – and for services to buyers in countries
outside the Netherlands that are not covered by the private market. ADSB
provides cover for political risks related to investments in other countries.
In addition, Atradius Dutch State Business provides cover on development
investments relevant for export contracts in medium and lower income
countries which benefit (local) SMEs. This service is provided under the Dutch
Good Growth Fund.
Next to this, the Dutch Trade and Investment Fund enables Atradius Dutch
State Business to provide cover on investments and export contracts up
to EUR 5 million for which finance support by commercial banks is notavailable. By discounting bills of exchange, these contracts can also be
financed by Atradius Dutch State Business.
In addition, Atradius Dutch State Business provides debt management
services, under an agreement with the Dutch State, including those relating
to international debt agreements concluded by the Paris Club. It also
manages the loan portfolio of the ‘Nederlandsche Investeringsbank voor
Ontwikkelingslanden’. This portfolio is in run-off and consists of concessionalloans to developing countries on behalf of the Dutch State.

Information Services
Atradius offers a wide range of information services through its new groupcompanies Graydon and Iberinform. These companies support businessdecision-making with business intelligence tools designed to analysecustomers, suppliers and competitors. Credit scoring models and business
reports help companies to assess customer credit risk, assign credit limits
and, ultimately, improve their cash flow.
Graydon has offices in the Netherlands, Belgium and the UK and uses a
network of 130 international databases around the world with information
on more than 90 million companies. Graydon is one of the leading providers
in business information solutions for credit management & collections,marketing intelligence and risk & compliance. Graydon’s markets showmodest growth. Competition is fierce at the low-end segment and incumbents
are moving to value added services. Graydon is moving towards more tailoredsolutions for customers delivering scalable products and services.
Iberinform is active in the Spanish and Portuguese markets. Iberinform
Portugal started in 2016 after acquiring an 80% share in Ignios. This puts
Iberinform in a strong position to consolidate a powerful range of products
and services for the Iberian market.
Business information services are also offered in Mexico via our company
Informes Mexico S.A.

43

Business
intelligence
tools designed
to analysecustomers,
suppliers andcompetitors.

Atradius | Consolidated management report

Building throughpeople who can makea difference
The success of Atradius depends on the
success of our employees. Ambitious
Teamwork is one of Atradius’ core values– promoting working together.
Employee engagement survey
We value our employees, opinion about what is going well and what could
be improved upon in Atradius. Since 2006, Atradius has conducted four
employee engagement surveys. The survey gives insight into the organisationfrom the perspective of the employees and offers the different units andteams practical information to pinpoint improvement areas and design
concrete actions.
In 2017 another survey was conducted. The results showed that Atradiusscored higher than the previous survey and also higher than the benchmark
on most themes.
Overall the survey showed that our employees are strongly connected to
Atradius as an employer and improvement opportunities are being addressedwith the roll-out of local improvement plans.

Atradius Academy
The motto of the Atradius Academy is ‘to maximise the potential of our staff’.
Atradius supports an environment of continuous learning and invests inupskilling staff. Being adaptable to new challenges is important in this time of
rapid change, Atradius invests in the development of staff so they are able tosupport our evolving customers’ needs in the best way possible and to remain
positive and open for change in the future.
Atradius invests in people by offering a wide choice of development
opportunities. At any time and in any place, staff can connect to our Learning
Management System to immerse themselves into a wide selection of
E-learning courses. Staff and managers have the ability to create personalised
learning paths from an extensive library of training materials to suit theirown development needs.

44

Employees
are strongly
connected to
Atradius as an
employer.

In 2017 three Management Development Programmes were organised by the Atradius
Academy: Stepping Forward 1 & 2 and Moving Forward with each programme being
designed for a specific audience. This year the Moving Forward programme wasoffered to the entire Atradius Leadership Team to support them with the important
challenge of leading our staff through a period of change and transformation.
For our Management Board and Supervisory Board we organised a Permanent
Education session covering two topics: new developments in the insurance andfinance industry and cybercrime.

The importanceof teamwork
and social
responsibility.

To ensure that all Atradius employees maintain up-to-date knowledge ofcompliance and governance rules and regulations, we run the annual Atradius
Learning Carousel. The 2017 version of the Carousel addressed an introduction to
the General Data Protection Regulation (GDPR) and Cybercrime. Participation inthese e-learning courses is mandatory for all employees.

Evolve +Evolve+ is the continuation of our multi-year cultural change programme which
focuses on increasing innovation and being more externally focused to support
connecting with our customers in a personal and meaningful way.
The ‘Atradius Cares’ initiative was launched in 2017 to highlight the importanceof teamwork and social responsibility. This initiative brings together all the social
activities that are organised by our staff worldwide to create a powerful overview
of the impact that Atradius is making on our local communities. Events suchas charity sports events, and food and toy drives have resulted in engaging andempowering experiences for the people involved.

Gender diversity
Dutch public interest entities that meet the criteria of a large legal entity inaccordance with title 9, Book 2 of the Dutch civil Code, effective from 13 April 2017,
requires large Dutch companies, when nominating or appointing members to their
Management Board or Supervisory Board, to take into account, as far as possible abalanced composition of these boards in terms of gender, so that at least 30% of thepositions are held by women and at least 30% by men. Although it is not obligatory,
Atradius uses this policy as good practice.
The current composition of the Management Board and the Supervisory Board
deviates from these percentages. In January 2017, two new appointments weremade in respect of the Supervisory Board and none for the Management Board.
With regard to future appointments, the Management Board and the Supervisory
Board will take gender diversity objectives into account as far as possible.
Indicators

2017 2016 (1)

2015

2014

2013

2012

2011

2010

2009

2008

Headcount

3,756

3,758

3,333

3,298

3,257

3,315

3,304

3,318

3,627

4,106

Total average number of employees(full-time equivalent)

3,591

3,584

3,153

3,132

3,132

3,139

3,159

3,318

3,662

3,851

Total year end number of employees(full-time equivalent)

3,596

3,586

3,161

3,139

3,107

3,143

3,149

3,165

3,470

3,854

Retention rate

91.1%

92.3%

92.0%

94.9%

91.4%

92.6%

91.1%

85.8%

88.6%

88.8%

Sick leave

3.1%

2.9%

3.1%

2.8%

3.0%

3.1%

3.4%

3.6%

3.4%

3.0%

Development and training
Expenses as % of salaries

1.8%

1.7%

1.6%

1.5%

1.2%

1.4%

1.3%

1.3%

1.4%

2.5%

Number of training attendees

9,228

7,680

6,366

5,646

5,283

1,656

1,952

1,236

1,943

4,455

(1)

Including FTEs from Graydon, Iberinform Portugal, Gestifatura and Informes since 2016.

45

Atradius | Consolidated management report

Securing futurefinancial stability
As a global insurance company, Atradius
is exposed to many and varied risks
Atradius classifies its main risk types as insurance, financial and operational.
Insurance risk is predominantly the risk of non-payment by a buyer coveredby a policy (credit insurance) or the risk of non-performance of a customer(bonding). Financial risks arise out of developments in financial markets andwith counterparties - including market risk, credit risk and liquidity risk.
Operational risk is the risk of direct or indirect losses resulting from humanerror, inadequate or failed internal processes, systems or external events and includes fraud risk.

Risk management
The boards of the Group companies have ultimate responsibility andaccountability for risk management and internal control within theirrespective companies. The Management Board owns, implements andoversees Atradius Group-wide risk governance through the Risk Strategy
Management Board (RSMB). A number of committees support the RSMB in
specific risk-related areas such as underwriting of buyer exposures, country
risk, provisioning, asset composition and investment policy, reinsurance,
quantitative modelling, and approval of new products. In addition, allemployees have well-defined authorities specifying the level of risk they
can accept. This framework ensures that risks are assumed and managed ina controlled way and in line with the risk appetite of the company. For thedescription of the main risks and uncertainties and how these are managed
please refer to Note 4 Risk and Capital management of the consolidated
financial statements.
The relationship between risk and capital is fundamental for Atradius.
Understanding how risk-taking consumes capital allows management tosteer Atradius and to take strategic decisions with the interdependence ofrisk and capital in mind. These decisions are increasingly informed by theoutcomes of Atradius’ internally developed economic capital model. Thismodel contributes to a multitude of risk assessment activities and risk
profile measurement, and allows Atradius to better monitor and manage risk
levels within the organisation through the allocation of risk-based capital.
In addition the model is used in the partial internal model for calculation ofregulatory capital requirements under Solvency II.

46

Atradius | Consolidated management report

Atradius compliance framework
Compliance practices support our business, our reputation and our integrity.
Complying with relevant laws, rules and regulations and maintaining a highstandard in terms of ethics and integrity leads to lower operational risk andmore stable business processes. The Group’s Code of Conduct outlines thebasic corporate, legal and ethical compliance principles and guidelines that
apply to all employees of the Group and that govern the Group’s operations
and its employees’ business conduct and actions. Individual Compliance
Codes address specific compliance areas in more detail and set out detailed
compliance requirements that must be followed across the Group and whichmust be included in business procedures. For example, the Customer Due
Diligence Code addresses potential risks in areas such as sanctions regulations
and money laundering. The Compliance Function within Atradius consistsof the Group Compliance Function and the Local Compliance Functions. The
Compliance Function supports the management of Atradius in meeting its
objective of being compliant with applicable laws, rules and external andinternal regulations.	

Capital management
Atradius seeks to maintain a strong capital position and well capitalised
operating entities. This helps us to support the evolution of our insurance
business, withstand financial stress in adverse business and financial markets,meet our financial obligations and ultimately deliver shareholder value.
In 2017 all Atradius’ entities were able to meet their financial obligations
efficiently and to comply with local legal and regulatory requirements.
Shareholders’ funds and Subordinated debt
Shareholders’ funds at the end of 2017: EUR 1,753.2 million increased by 7.9%
from EUR 1,625.5 million at year end 2016, due mainly to positive results
after tax.
Subordinated debt of EUR 323.6 million (nominal value) at the end of 2017consisted of subordinated notes of EUR 248.6 million and a subordinatedloan of EUR 75 million, both of which qualify as Tier 2 basic own funds for
Solvency II. For further details please see Note 16 of the consolidated financial
statements of the Annual Report 2017.

Regulatory capital
Atradius’ regulated entities maintain a strong solvency position. In particular,
the solvency ratio of Atradius at the end of 2017 is well above 200%.(1)As approved by the relevant supervisors during 2017, Atradius applies apartial internal model of underwriting risk for regulated entities to calculate
regulatory capital requirements under Solvency II. For further details on
the main Solvency II regulatory capital requirements please see theSolvency and Financial Condition Reports of Atradius’ European
regulated entities.
(1)

Subject to finalisation of any audit procedures.

47

Atradius | Consolidated management report

Connecting with ourcommunities
Atradius continues a journey toreport fully on our Corporate Social
Responsibility (CSR) in accordance with
the Global Reporting Initiative (GRI).
Atradius reaffirms its support of the ten principles of the United Nations
Global Compact (UNGC) with respect to Human Rights, Labour, Environment
and Anti-Corruption and we express our intent to remain a ‘good corporate
citizen’ by embedding these principles in our strategy, culture, and day-to-day
operations.
In our commitment to the UNGC principles, our ambition is to continue tohave a positive impact on our surroundings, and to strive for greater reportinglevels of transparency and accountability.
In line with the UN Global Compact Atradius produces an annualCommunication On Progress (COP) report detailing our delivery against
the ten UNGC principles into our strategies and operations, as well as ourefforts to support societal priorities. The COP is a visible expression of ourcommitment to sustainability. This report is available on the UN website(www.unglobalcompact.org).
As part of the GRI, an internal and external survey has been performed
in 2017 to provide input for an updated materiality matrix. A materiality
matrix prioritises key CSR topics and KPIs will be developed for all topics inthe matrix. Atradius has conducted an exercise to score the different topics
in terms of their importance to Atradius internally and the importance toexternal stakeholders. The higher scoring topics include areas such as;
customer centricity, ethics, employee well-being and human rights policies.
KPIs will be designed to monitor our progress on these topics in a quantifiable
manner. Please find below the materiality matrix that has been constructed
in 2017.

48

Our ambition is tocontinue to have apositive impact on
our surroundings.

Atradius | Consolidated management report

Very important

Information security

Fraud
control

Customer centricity
Business continuity
Trade &
economic
growthInnovation

Importance to stakeholders

Product & service transparency
Employeeengagement

Corporate
governance

Financial
Literacy

HumanrightspolicyTraining &development

Fraud
controlLong term
value creation

Employeewell-being

EthicsEconomic
performance

Relationshipmanagementwith partners

Sustainable sourcing
Corporate citizenship
Brokers/agents
attraction & retention

Less important

Inclusion & diversity

Brand management

Less important

Importance to Atradius N.V.

Very important

In addition to the materiality matrix a self-assessment for the Transparency
Benchmark (TB) has been performed and independently scored by an
external accountant. The Transparency Benchmark compares companies
based in the Netherlands on achievements in CSR. The official ranking
has been published by the Ministry of Economic Affairs and Atradius N.V.
achieved a record high score of 143 points (the maximum score is 200 points),
which is a significant improvement versus the previous listing.

Our customers
In addition to our day-to-day engagement in customer service, we also
connect with customers via our numerous free of charge publications such as
Country Reports, Payment Practice Barometers and Global Economic Outlook.
We also seek feedback from our customers about the services we provide to
identify improvement areas.
A recent customer survey indicated that 97% of surveyed customers would
recommend Atradius to other organisations.
Improvements have been made to the on-line connections for our customers
during 2017. We currently communicate more frequently and more directlywith our customers via the portal which customers can access at any given
moment. The portal provides our customers with valuable information on theirbuyers and exposure.

49

Atradius coverage
allows us tocompete with ourglobal competitors
by offering
attractive terms
to our prospective
customers.
Morten Fullerton, Director forInternational Sales, Rawbite

Atradius | Consolidated management report

Our suppliers
The Group Procurement Framework states that every (potential) supplier
will be screened to find out whether or not they apply the same standardsof ethical practice as Atradius, including the abolition of child labour. With
suppliers we interact on a day to day basis and have technical visits andmeetings. During these interactions we also discuss minimising waste andstrive for eco- friendly solutions. Atradius has an environmental policy stating
our approach to environmental challenges in our business.

Our people
Our employees are represented through the various local works councils
and the European Works Council. Furthermore there is a yearly dialogue(Roadshows) between the Management Board and the employees. During
these Roadshows not only financial results, budgets and key areas of strategy
are being discussed to bring a common focus and drive in the organisation. In
addition to Roadshows Atradius also invests in staff with surveys, training andthe evolve+ programme as mentioned the Human Recourses chapter of the
management report.

Our communities
Atradius is fully aware of the responsibility it has towards the communities
in which it operates, and as a company we encourage our people to involve
themselves in initiatives that benefit those communities: whether financial,personal or social. An initiative called ‘Atradius Cares’ provides a way for local
Atradius staff to share and gain recognition for local social projects. Some ofthe projects included are; events for disabled people, support for the American
Red Cross disaster relief, the Amsterdam City Swim to fight ALS, Warszawa
Business Run, Race for Breast Cancer and several initiatives to raise money for
local charities.

Our environment
New KPIs have been developed in accordance with the revised materiality
matrix. As a financial services provider, our environmental impact is small
compared to many other industries. However, our customers and otherstakeholders still expect us to minimise our impact, and as a responsible
business whose operations ultimately rely on natural resources, we areconstantly looking for opportunities to make efficient and sustainable use ofnatural resources.
We have developed a system for measuring key performance indicatorsfor each country to accurately gauge our consumption of energy and otherresources. We also monitor how much of that is derived from renewable
and recycled sources. Furthermore, our greenhouse gas emissions and our
methods of disposal of waste materials are monitored.
The definitions and measurement methods to gather information on our
key performance indicators remained the same as in previous years. An
updated online data collection tool is being used to collect and aggregate
the environmental KPI data. Our Country Managers in each country are
responsible for the quality of the submitted data. Lastly, the collected data isreviewed and verified at central level. All of the above positively contributes tothe quality of the obtained data. We plan to use these data in the developmentof objectives for further reductions of our environmental footprint.

50

The relationshipand service
levels provided
by Atradius aresecond to none.
Atradius fully
understands ourbusiness needs andrequirements.
Vishnu Gopie, General Manager,
Credit & AR, LG Electronics LTD

Atradius | Consolidated management report

Environmental KPIs (1)

2017

2016

2017/2016

KPI

Total

Total

Change32

32-

Number of reporting countries
Number of offices
Total office space (m2)

99

99

-

101,429

106,142decrease

Energy (gas & electricity) usage
Electricity from non-renewable source (kWh)7,730,922

7,868,831

decrease

Electricity from renewable source (kWh)2,794,747

2,966,516

decrease

26.6%

27.4%

decrease

10,525,669

10,835,347

decrease% of renewable electricity
Total electricity (kWh)Gas (m )361,173

411,521decrease

13,709,761

14,466,843

decrease

Employee air travel (km)15,780,012

13,738,292

increase

Employee rail travel (km)3,042,574

2,615,557

increase

Company lease car travel (km)10,614,257

10,670,533

decrease

Total travel (km)29,436,843

27,024,382

increase

6,870

7,159

decrease

3

Total energy
TravelCO2 footprint (tonnes of CO2)
Energy (CO2)
Travel (CO2)

7,871

7,151

increase

Total (CO2)

14,741

14,310increase

Non-recycled paper (sheets A4)

15,206,023

16,341,548

decrease

Recycled paper (sheets A4)4,225,298

5,173,324

decrease

21.7%

24.0%

decrease

19,431,321

21,514,872

decrease

39,237

38,202increase

Paper used

% recycled paper
Total paper
Water usage (m3)
Waste -per type

6.0

7.1

decrease

Non-hazardous waste (tonnes)

Hazardous waste (tonnes)

532.0

558.0

decrease

Total waste

538.0

565.1

decrease(1)

This table does not include information from Graydon, Gestifatura, Informes and Iberinform Portugal.

51

Connected on the go52

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Consolidated financial statements 2017
Contents
Consolidated financial statements .......................................................................................................................................... 54
Notes to the consolidated financial statements
1

General information .............................................................................................................................................................. 59

2

Summary of significant accounting policies ................................................................................................................ 59

3

Critical accounting estimates and judgements in applying accounting policies ............................................. 77

4

Risk and capital management ........................................................................................................................................... 79

5

Segment information .......................................................................................................................................................... 101

6

Intangible assets ................................................................................................................................................................... 105

7

Property, plant and equipment & investment property ......................................................................................... 107

8

Subsidiaries............................................................................................................................................................................ 109

9Investments in associated companies .......................................................................................................................... 110

10 Financial investments ........................................................................................................................................................ 112
11 Receivables .............................................................................................................................................................................. 112
12 Deferred acquisition costs .................................................................................................................................................. 113
13 Miscellaneous assets and accruals .................................................................................................................................. 113
14 Cash and cash equivalents .................................................................................................................................................114
15 Capital and reserves .............................................................................................................................................................114
16 Subordinated debt ................................................................................................................................................................. 116
17 Employee benefit assets and liabilities .......................................................................................................................... 116
18 Insurance contracts .............................................................................................................................................................. 121
19 Provisions ............................................................................................................................................................................... 125
20 Deferred and current income tax................................................................................................................................... 126
21 Payables .................................................................................................................................................................................. 128
22 Other liabilities ..................................................................................................................................................................... 128
23 Net premium earned .......................................................................................................................................................... 129
24 Service and other income ................................................................................................................................................. 129
25 Net income from investments ......................................................................................................................................... 130
26 Insurance claims .................................................................................................................................................................. 132
27 Net operating expenses ..................................................................................................................................................... 133
28 Finance expenses ................................................................................................................................................................ 133
29 Income tax ............................................................................................................................................................................. 134
30 Dividends per share............................................................................................................................................................ 134
31 Assets not freely disposable ............................................................................................................................................. 134
32 Capital commitments and contingencies .................................................................................................................... 134
33 Operating leases ................................................................................................................................................................... 135
34 Personnel ............................................................................................................................................................................... 135
35 Related party transactions ............................................................................................................................................... 135
36 Events after the reporting period ................................................................................................................................... 137

5353

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Consolidated financial statements
Consolidated statement of financial position
AssetsNote

31.12.201731.12.2016

Intangible assets

6

236,419

226,005

Property, plant and equipment

7

133,445

125,968

Investment property

7

9,688

9,908

Investments in associated companies

963,53839,586

Financial investments

102,287,830

2,280,293

Reinsurance contracts

18585,887

632,262

Deferred income tax assets

20

30,08745,315Current income tax assets

20

59,55950,613

Receivables

11

225,079

201,287

Accounts receivable on insurance and reinsurance business

164,983

153,405

Other accounts receivable

60,09647,882Other assets

540,459

519,356
73,124

Deferred acquisition costs

12

69,441

Miscellaneous assets and accruals

13

471,018

446,232

Cash and cash equivalents

14

347,171

287,080

4,519,162

4,417,673

1,753,232

1,625,470

16

55

1,753,248

1,625,525

Total
EquityCapital and reserves attributable to the owners of the Company
Non-controlling interests
Total
Liabilities
Subordinated debt

16

323,614

323,437

Employee benefit liabilities

17

79,554

109,451

Insurance contracts

18

1,530,339

1,561,155

Provisions

19

3,034

6,027

Deferred income tax liabilities

20

124,951

115,179

Current income tax liabilities

20

37,63623,960

Payables

21

200,947

232,746

129,822

183,407

71,12549,339459,846

419,582

Accounts payable on insurance and reinsurance business
Trade and other accounts payable
Other liabilities

22

Borrowings

14

5,993

611

Total

2,765,914

2,792,148

Total equity and liabilities

4,519,162

4,417,673

54

54

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Consolidated income statement
Note

2017

2016

Insurance premium revenue

23

1,588,095

1,557,588

Insurance premium ceded to reinsurers

23(675,629)(663,831)

912,467

893,757

Net premium earned
Service and other income

24249,140

203,079

Share of income/ (losses) of associated companies

25(7,396)

26,689Net income from investments

25

20,586

18,2791,174,797

1,141,804

Total income after reinsurance
Insurance claims and loss adjustment expenses

26(714,482)(698,392)

Insurance claims and loss adjustment expenses recovered from reinsurers

26

285,498

271,896(428,984)(426,496)(473,929)(431,325)

Total expenses after reinsurance(902,913)(857,821)

Operating result before finance costs

271,884

283,983

2,696

3,325

(19,271)(12,744)

255,309274,564(69,073)(62,792)

186,236

211,772

Owners of the Company

186,275

211,795

Non-controlling interests

(39)

(23)

Total result for the year

186,236

211,772

Net insurance claims
Net operating expenses

27

Finance income
Finance expenses

28

Result for the year before tax
Income tax expense

29

Result for the year
Attributable to:55

55All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Consolidated statement of comprehensive income
Note
Result for the year

2017

2016

186,236

211,772

Other comprehensive income:Items that will not be reclassified to the income statement:
Effect of the asset ceiling on defined benefit pension plans

15.5(3,286)-

Actuarial gains/(losses) on defined benefit pension plans

15.5

45,643(40,045)(9,370)7,925

12,854

20,324--(25,303)(1,869)

Income tax relating to items that will not be reclassified
Items that may be subsequently reclassified to the income statement:
Net fair value gains/(losses) on available-for-sale financial investments
Share of other comprehensive income of associated companies
Exchange gains/(losses) on translating foreign operations and associatedcompanies

15.3

15.4

Income tax relating to items that may be reclassified(2,303)(1,699)Other comprehensive income for the year, net of tax

18,235(15,364)

Total comprehensive income for the year

204,471

196,408

204,510

196,431

(39)

(23)

204,471

196,408

Attributable to:
The owners of the Company
Non-controlling interests
Total comprehensive income for the year

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Consolidated statement of changes in equity
Attributable to the owners of the Company
SharecapitalShare Revaluation
Currency
premium
reserve translation
reserve
reserve

Pensionreserve

Retainedearnings

Total

Noncontrollinginterests

Total
equity79,122

639,228

37,176(31,733)(138,190)

914,646

1,500,249-

1,500,249

Acquisitions--

Dividends

-

-

-

-

-

-

-

78

78

-

-

-

(71,210)(71,210)-(71,210)

Total comprehensive
income for the year-

Result for the year--

17,581(825)(32,120)

211,795

196,431(23)

196,408

-

-

-

-

211,795

211,795(23)

211,772

79,122

639,228

17,58154,757(825)(32,558)(32,120)(170,310)

1,055,231(15,364)
1,625,470

55(15,364)
1,625,525

79,122

639,22854,757(32,558)(170,310)

1,055,231

1,625,470

55

1,625,525

Dividends

-

-

-

-

-

(76,748)(76,748)-(76,748)

Total comprehensive
income for the year

-

-

8,303

(23,055)

32,987

186,275

204,510(39)

204,471

Result for the year

-

-

-

-

-

186,275

186,275(39)

186,236

79,122

639,228

8,303
63,060(23,055)(55,612)32,987(137,323)

1,164,758

18,235
1,753,232

16

18,235
1,753,248

Balance at 1 January
2016

Other comprehensive
incomeBalance at 31 December
2016
Balance at 1 January
2017

Other comprehensive
incomeBalance at 31 December
2017

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57

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Consolidated statement of cash flows
2017

2016

255,309274,564

Realised capital (gains)/losses on investments(5,379)(23,296)

Dividends received from financial investments(9,463)(9,762)

Share of income of associated companies(3,678)(4,975)

I. Cash flows from operating activities
Result for the year before tax
Adjustments for:

Depreciation, impairment and amortisation

67,60859,712

Interest expense on subordinated debt

17,065

15,894

Net interest income(37,582)(38,154)

Other non-cash items

27,686(1,452)

Insurance contracts(30,816)(87,636)

Reinsurance contracts

46,37557,587

Deferred acquisition costs

3,683

795

Changes in operational assets and liabilities:

Accounts receivable and payable on insurance and reinsurance business(65,163)

43,540Changes in other assets and liabilities

48,986(74,973)

Pensions and other long-term employee benefit net contributions(22,870)(28,434)

Cash generated from operations

291,761

183,410

Income tax paid

(58,070)(47,955)

Interest paid

(1,308)(2,102)

232,383

133,353

Net cash (used in)/generated by operating activities
II. Cash flows from investing activities
Investments and acquisitions (cash outflows):
Business Combination(21,300)

Investments in associated companies(34,742)-

Short-term investments(159,856)(88,408)

Financial investments available-for-sale(586,891)(966,407)

Property, plant and equipment and intangible assets(50,393)(46,035)

Short-term investments

157,368

158,005

Financial investments available-for-sale543,470

823,271

2

1,616

Divestments, redemptions and disposals (cash inflows):

Property, plant and equipment and intangible assets
Net cash acquired in a business combination

14,465

Dividends received from associated companies

462-

Dividends received from financial investments

9,001

9,762

Interest received

42,23745,070Net cash (used in)/generated by investing activities(79,342)(69,961)

Dividend paid

(76,748)(71,210)

Interest paid on subordinated debt

(16,875)(13,125)-75,000(93,623)(9,335)

III. Cash flows from financing activities

Subordinated debt - addition
Net cash (used in)/generated by financing activities
Changes in cash and cash equivalents (I + II + III)59,41854,057

Cash and cash equivalents at the beginning of the year

286,469

229,376

Effect of exchange rate changes on cash and cash equivalents(4,709)3,036

Cash and cash equivalents at the end of the year

341,178

286,469

The cash and cash equivalents are presented net of bank overdrafts (see Note 14).

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Notes to the consolidated financial statements
1

General information

Atradius N.V. (‘the Company’), with its office at David Ricardostraat 1, 1066 JS, Amsterdam, the Netherlands, and its
subsidiaries (together referred to as ‘Atradius’) is a global credit insurer and aims to support its customers’ growth bystrengthening their credit and cash management through a wide range of credit insurance management products andservices. These services include credit insurance, bonding, reinsurance, information services, collection services andinstalment credit protection. Atradius offers products and services from strategically located offices on six continents
and employed 3,756 people as at 31 December 2017 (2016: 3,758). The parent is Grupo Compañía Española de Crédito y
Caución, S.L., which owns 64.23% (2016: the same) of the shares in Atradius N.V. The ultimate parent and the ultimate
controlling party of Atradius is Grupo Catalana Occidente, S.A., which holds 73.84% of the shares in Grupo Compañía
Española de Crédito y Caución, S.L. and 35.77% (2016: the same) of the shares in Atradius N.V. The financial statementsof Atradius N.V. are consolidated within Grupo Catalana Occidente, S.A., which is a listed company in Spain.
The Atradius consolidated financial statements have been authorised for issue by the Management Board on 9 March2018 and have been reviewed by the Supervisory Board. On 9 March 2018 the consolidated financial statements havebeen adopted at the Annual General Meeting of Atradius N.V.

2

Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out
below. These policies have been consistently applied to all financial years presented, unless otherwise stated.

2.1

Basis of preparation

The Atradius consolidated financial statements are prepared in accordance with International Financial ReportingStandards (IFRS) as adopted by the European Union and also comply with Part 9 of Book 2 of the Dutch Civil Code.
These have been prepared under the historical cost convention as modified by the revaluation of available-for-salefinancial investments.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its judgement in the process of applying the Atradius accounting
policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the consolidated financial statements, are disclosed in Note 3.
The income statement of Atradius N.V. for 2017 is incorporated in the consolidated financial statements, which allow
for a presentation of a condensed company income statement in the company financial statements in compliance withBook 2, Article 402 of the Dutch Civil Code.
All amounts in the notes are shown in thousands of Euro (EUR), rounded to the nearest thousand, unless otherwise
stated.

2.2

New and revised standards

All changes in the accounting policies have been made in accordance with the transitional provisions in the respective
standards. All standards and amendments adopted by Atradius require retrospective application.

2.2.1

Standards, amendments and interpretations effective in 2017

The following relevant standards, amendments and interpretations have been adopted in 2017, but have had nomaterial effect on the consolidated financial statements unless otherwise mentioned:

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

-

-

2.2.2

Amendments to IAS 7 Statement of Cash Flows. The amendments will require entities to provide
disclosures that enable investors to evaluate changes in liabilities arising from financing activities,
including changes arising from cash flows and non-cash changes;
Amendments to IAS 12 Income Taxes. The amendments, Recognition of Deferred Tax Assets for
Unrealised Losses, clarify how to account for deferred tax assets related to debt instruments measured atfair value;Standards, amendments and interpretations not yet adopted

The following relevant standards and amendments are effective for annual periods beginning after 31 December 2017and have not been early adopted by Atradius:
-

-

-

-

IFRS 9 Financial Instruments (effective 1 January 2018). This standard replaces the existing guidance in
IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 includes revised guidance on theclassification and measurement, impairment of financial instruments and the new general hedge
accounting requirements. In September 2016, the IASB issued amendments to IFRS 4 to address issues
arising from the different effective dates of IFRS 9 and the forthcoming new insurance contracts
standard (IFRS 17). The amendments introduce two alternative options for entities that issue insurance
contracts within the scope of IFRS 4:
an option that permits entities to reclassify, from profit or loss to other comprehensive
income, some of the income or expenses arising from designated financial assets (the‘overlay approach’);an optional temporary exemption from applying IFRS 9 for entities whose predominant
activity is issuing contracts within the scope of IFRS 4 (the ‘deferral approach’). The
temporary exemption enables eligible entities to defer the implementation date of IFRS 9
for annual periods beginning before 1 January 2021 at the latest.
The application of both approaches is optional and an entity is permitted to stop applying them before the
new insurance contracts standard is applied. Atradius performed an assessment of the amendments andconcluded that its activities are predominantly connected with insurance as at 31 December 2015.
Atradius intends to apply the temporary exemption in its reporting period starting on 1 January 2018 and
expects to adopt IFRS 9 in combination with the adoption of IFRS 17 Insurance contracts in 2021;
IFRS 15 Revenue from Contracts with Customers (effective 1 January 2018) establishes a comprehensive
framework for determining whether, how much and when revenue is recognised. Under IFRS 15 revenue
is recognised at an amount that reflects the consideration to which an entity expects to be entitled in
exchange for transferring goods or services to a customer. The new revenue standard will supersede thecurrent revenue recognition standard and the related interpretations under IFRS. Since insurance
contracts are scoped out of IFRS 15, only income from services and other income will be affected.
Atradius will adopt the standard using the modified retrospective method. The standard is not expected
to have a material impact on the consolidated financial statements;
IFRS 16 was issued in January 2016 (effective 1 January 2019) and replaces IAS 17 Leases. IFRS 16 sets
out the principles for the recognition, measurement, presentation and disclosure of leases and requires
lessees to account for all leases under a single on-balance sheet model similar to the accounting for
finance leases under IAS 17. At the commencement date of a lease, a lessee will recognise a liability tomake lease payments and an asset representing the right to use the underlying asset during the lease
term. Lessees will be required to separately recognise the interest expense on the lease liability and thedepreciation expense on the right-of-use asset.
Lessor accounting under IFRS 16 is substantially unchanged from today’s accounting under IFRS 17.
Atradius has completed the initial assessment of the potential impact on its consolidated financial
statements. So far, the most material impact identified is that Atradius will recognise new assets andliabilities for its operating leases, of which the majority are buildings, estimated at approximately EUR
98 million as at 31 December 2017 (undiscounted) with no material impact on profit or loss.
In addition, the nature of expenses related to those leases will now change as IFRS 16 replaces thestraight-line operating lease expense with a depreciation charge for the right-of-use assets and interest
expense on lease liabilities. Atradius plans to implement IFRS 16 using the modified retrospective
approach.
Annual improvements cycle 2014-2016 Cycle (effective 1 January 2018). The Cycle introduces limited
amendments to the following standards: IAS 28 Investments in Associates and Joint ventures and IFRS 1
First time adoption of International Financial Reporting Standards. The amendments are not expected tohave a material impact on the consolidated financial statements.

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

The following relevant standards and amendments have not yet been endorsed by the European Union and as such
have not been adopted:
-

-

-

-

2.3

IFRS 17 Insurance contracts (effective 1 January 2021). The standard replaces the existing guidance in
IFRS 4 Insurance contracts. IFRS 17 aims to provide a more useful and consistent accounting model
among entities issuing insurance contracts. The standard is expected to have a material impact on the
consolidated financial statements;
Amendments to IAS 40 Investment property: Transfer of investment property (effective 1 January 2018)clarifies that management’s intention is insufficient on its own to justify a previously recognised
property from being reclassified to or from the investment property category. The amendment is notexpected to have a material impact on the consolidated financial statements;
Annual improvements cycle 2015-2017 Cycle (effective 1 January 2019). The cycle introduces limited
amendments to the following standards: IFRS 3 Business combinations, IFRS 11 Joint arrangements, IAS
12 Income taxes and IAS 23 Borrowing costs. The amendments are not expected to have a material
impact on the consolidated financial statements;
IFRIC 22 Foreign Currency Transactions and Advance Consideration (effective 1 January 2018). Theinterpretation is not expected to have a material impact on the consolidated financial statements;
IFRIC 23 Uncertainty over Income Tax Treatments (effective 1 January 2019). The interpretation is notexpected to have a material impact on the consolidated financial statements;
Amendment to IAS 19 Employee benefits, on Plan amendment, curtailment or settlement (effective 1
January 2019) specifies how companies determine pension expenses when changes to a defined benefit
pension plan occur. Atradius is currently assessing the impact of the amendment on the consolidated
financial statements.

Changes in presentation

The information contained in this consolidated financial statements referred to 2016 are disclosed solely forcomparative purposes with the current period presentation.
The consolidated statement of financial position of 2016, disclosed solely for comparative purposes, differs from theconsolidated statement of financial position approved for the 2016 year-end due to a reclassification of EUR 26.2
million from the line Other liabilities to Miscellaneous assets and accruals. This amendment has not impact in equity
or in the consolidated income statement of the 2016 year-end.

2.4

Consolidation

The following principles of consolidation and measurement are applied to the financial statements:

2.4.1

Subsidiaries

Subsidiaries are all entities over which Atradius has control. Atradius controls an entity when it is exposed to, or has
rights to variable returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to Atradius.
They are de-consolidated from the date on which control ceases.
Intragroup transactions, balances and unrealised gains on intragroup transactions are eliminated. Unrealised losses
are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Subsidiaries’
accounting policies are changed where necessary to ensure consistency with the policies adopted by Atradius except
for the accounting for insurance contracts (see Note 2.18).

2.4.2

Business combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a businesscombination is measured at fair value, which is calculated as the sum of fair values of the assets (at the acquisitiondate) transferred to Atradius, liabilities incurred by Atradius to the former owners of the acquiree and the equity
interests issued by Atradius in exchange for control of the acquiree. Acquisition-related costs are generally recognisedin the income statement as incurred.

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value atthe acquisition date, except that the deferred tax assets or liabilities and assets or liabilities related to employee
benefit arrangements are recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee
Benefits respectively.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controllinginterests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any)over the net amount of the identifiable assets acquired and the liabilities assumed. If the net amount of the identifiable
assets acquired and the liabilities assumed exceed the sum of the consideration transferred, the amount of any noncontrolling interests in the acquiree and the fair value of Atradius’ previously held equity interest in the acquiree (ifany), then the excess is recognised immediately in profit or loss as a bargain purchase.
Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of theentity’s net assets in the event of liquidation, may be initially measured either at fair value or at the non-controllinginterests’ proportionate share of the recognised amounts of the acquiree’s identifiable net assets. The choice ofmeasurement method is made on a transaction-by-transaction basis. Other types of non-controlling interests aremeasured at fair value or, when applicable, on the basis specified in another IFRS.
When the consideration transferred by Atradius in a business combination includes assets or liabilities resulting froma contingent consideration arrangement, the contingent consideration is measured at the fair value and included in
the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that
qualify as measurement period adjustments, are adjusted retrospectively, with a corresponding adjustment togoodwill. Measurement period adjustments are adjustments that arise from additional information obtained during
the ‘measurement period’ (which cannot exceed one year from the acquisition date) about facts and circumstancesthat existed at the acquisition date.
The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as
measurement period adjustments depends on how the contingent consideration is classified. A contingent
consideration that is classified as equity is not re-measured at subsequent reporting dates and its subsequent
settlement is accounted for within equity. A contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates in accordance with IAS 39 Financial Instruments: Recognition andMeasurement or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with thecorresponding gain or loss being recognised in profit or loss.
When a business combination is achieved in stages, Atradius’ previously held equity interest in the acquiree is remeasured to fair value at the acquisition date (i.e., the date when Atradius obtains control) and the resulting gain or
loss, if any, is recognised in the income statement. Amounts arising from interests in the acquiree before theacquisition date that have previously been recognised in other comprehensive income are reclassified to profit or loss
where such treatment would be appropriate if that interest were disposed of.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the
combination occurs, Atradius reports provisional amounts for the items for which the accounting is incomplete. Those
provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities arerecognised, to reflect new information obtained about facts and circumstances that existed at the acquisition date that,
if known, would have affected the amounts recognised at that date.

2.4.3

Associated companies

Associated companies are entities in which Atradius has significant influence, but not control or joint control, over thefinancial and operating policies, generally accompanying a shareholding of between 20% and 50% of the voting rights.
Associated companies are accounted for using the equity method and are initially recognised at cost. Atradius’
investment in associated companies includes goodwill (net of any accumulated impairment loss).
Atradius’ share in its associated companies’ post-acquisition profits or losses is recognised in profit or loss, and its
share of post-acquisition movements in other comprehensive income is recognised in other comprehensive income.
Unrealised gains on transactions between Atradius and its associated companies are eliminated to the extent of
Atradius’ interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of6262Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

an impairment of the asset transferred. Associate’s accounting policies are changed where necessary to ensure
consistency with the policies adopted by Atradius.
Interests in companies in which Atradius does not exercise significant influence are accounted for at fair value, in
accordance with the accounting principles for available-for-sale investments.

2.5

Segment reporting

IFRS 8 requires operating segments to be identified on the basis on which the Management Board regularly reviews
components of Atradius in order to allocate resources to the segments and to assess their performance. Operating
segments are reported in a manner consistent with the internal reporting provided to the Management Board.

2.6

Foreign currencies

2.6.1

Functional and presentation currency

Items included in the financial statements of each of Atradius’ entities are measured using the currency of the primaryeconomic environment in which the entity operates (the ‘functional currency’).

2.6.2

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at thedates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions andfrom the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in the income statement. A monetary item that forms part of a net investment in a foreign operation forwhich settlement is neither planned nor likely to occur in the foreseeable future is, in substance, part of the net
investment in that foreign operation. In the consolidated financial statements the related exchange gains and losseson these monetary items are recognised in other comprehensive income.
Translation differences on non-monetary items, such as equities classified as available-for-sale financial investments,
are included in the revaluation reserve through other comprehensive income.

2.6.3

Atradius companies

The results and financial position of all Atradius entities that have a functional currency different from thepresentation currency are translated into the presentation currency as follows:--

assets and liabilities for each statement of financial position presented are translated at the closing
exchange rate at the date of that statement of financial position;
income and expenses for each income statement presented are translated at monthly average exchange
rates unless this average is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at exchange rates
at the dates of the transactions; andall resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from the translation of the net investment in foreign entities and ofborrowings and other currency instruments designated as hedges of such investments, are taken to othercomprehensive income. When a foreign operation is sold, such exchange differences are recognised in the income
statement as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as the foreign entity’s
assets and liabilities and are translated at the closing rate.
The exchange rates of the most relevant functional currencies for Atradius are presented below:

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Currency

End rate
GBP

USD

Average rate
AUD

GBP

USD

AUD

At 31 December 2017

1.127

0.834

0.652

1.146

0.891

0.680

At 31 December 2016

1.168

0.949

0.685

1.235

0.900

0.672

2.7

Goodwill and other intangible assets

2.7.1

Goodwill

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controllinginterests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any)over the net amount of the identifiable assets acquired and the liabilities assumed. If the net amount of the identifiable
assets acquired and the liabilities assumed exceed the sum of the consideration transferred, the amount of any noncontrolling interests in the acquiree and the fair value of Atradius’ previously held equity interest in the acquiree (ifany), then the excess is recognised immediately in profit or loss as a bargain purchase. Goodwill arising on an
acquisition of a business is carried at cost as established at the date of acquisition of the business (see Note 2.4.2) lessaccumulated impairment losses, if any.
For the purpose of impairment testing, goodwill is allocated to Atradius’ relevant cash-generating units. Cashgenerating units to which goodwill has been allocated are tested for impairment annually, or more frequently when
there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less thanthe carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill
allocated to the unit and then to the other assets of the unit pro rata on the basis of the carrying amount of each asset
in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on
disposal.
Goodwill on the acquisitions of associated companies is included in investments in associated companies.

2.7.2

SoftwareAcquired computer software licenses 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.
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, are recognised as
intangible assets. Direct costs include the software development team’s employee costs and an appropriate portion of
relevant overhead. All other costs associated with developing or maintaining computer software programmes arerecognised as an expense as incurred. 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 offive 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.

2.7.3

Other intangible assets

Other intangible assets are recognised at fair value at the acquisition date. Amortisation charges are included in net
operating expenses and are calculated using the straight-line method over the expected life of the asset which isestimated to be between 5 and 15 years.

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

2.8

Property, plant and equipment

Land and buildings comprise offices occupied by Atradius (‘property for own use’). Land and buildings are stated at
the cost of acquisition or construction, less any subsequent accumulated depreciation and subsequent accumulated
impairment losses. For analysis of the residual value, the fair value is assessed based on active market prices, adjusted
if necessary, for any difference in the nature, location or condition. All other property, plant and equipment are statedat historical cost less accumulated depreciation and subsequent impairment losses.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to Atradius and the cost of theitem can be reliably measured. All other repairs and maintenance are recognised as an expense in the income
statement during the financial period in which they are incurred.
Some of Atradius’ properties comprise a part that is held as investment property to earn rentals or for capital
appreciation and another part that is held for own use. If these parts could be sold separately or leased out separately
under a financial lease, Atradius accounts for the parts separately as investment property and property for own use,
respectively.
The depreciation period is based on the estimated economic useful life of the asset. Leasehold improvements areamortised over the shorter of the estimated useful life of the improvements and the respective lease terms. Land is notdepreciated. All other assets are depreciated using the straight-line depreciation method over the estimated economic
useful lives: buildings over 50 years, fixtures and fittings over 3-10 years and information systems hardware over 3-5
years.

2.9

Investment property

Property held for long-term rental yields that is not occupied by one of the companies of Atradius is classified as
investment property.
Investment property comprises freehold land and buildings. It is stated at the cost of acquisition or construction, lessany subsequent accumulated depreciation and subsequent impairment losses. Buildings are depreciated using thestraight-line depreciation method over the estimated economic useful life of the property: 50 years.

2.10

Fair value measurements

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 on an arm’s length basis;
Level 2: Valuation techniques based on observable market data. This category includes financial instruments forwhich the fair value is determined using a valuation technique (a valuation model), where inputs in the valuation
model are taken 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 of similar instruments, but for which the prices are (more than insignificantly) modified based onother market observable external data;
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 levelof the input is not supported by a current observable market transaction. 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 with an external independent valuation company.

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

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 Atradius is the current bid price.
Transaction costs on initial recognition of financial investments are expensed as incurred.
The fair values of financial instruments in markets that are not active are determined using valuation techniques.
Atradius uses a variety of methods and assumptions that are based on market conditions existing at the end of thereporting period.
The fair values of property for own use and investment property are determined by independent real estate valuators
registered in the relevant countries and who have appropriate qualifications and experience in the valuation ofproperties.
See Note 4.3.1.1 for further details regarding the determination of the fair value of financial investments.

2.11

Recognition and derecognition of financial investments

All purchases and sales of financial investments carried at fair value that require delivery within the time frame
established by regulation or market convention (‘regular way’ purchases and sales) are recognised at trade date, i.e.
the date that Atradius commits to purchase or sell the asset. Loans and receivables are recognised and derecognised atsettlement date, the date Atradius receives or delivers the asset.
Financial investments are derecognised when the rights to receive cash flows from the financial investments have
expired or where Atradius has transferred substantially all the risks and rewards of ownership. If Atradius neithertransfers nor retains substantially all the risks and rewards of ownership of a financial investment and does not retain
control over the investment, it derecognises the financial investment. In transfers where control over the asset isretained, Atradius continues to recognise the asset to the extent of its continuing involvement. The extent ofcontinuing involvement is determined by the extent to which Atradius is exposed to changes in the value of the asset.

2.12

Classification of financial investments

Atradius classifies its financial investments into two categories: investments available-for-sale and loans andreceivables. The classification depends on the purpose for which the investments were acquired. Atradius determines
the classification of its investments at initial recognition and re-evaluates this at the end of each reporting period.

2.12.1 Available-for-sale financial investments
Available-for-sale financial investments are non-derivative financial investments that are either designated in thiscategory or not classified in other categories.
Financial investments are initially recognised at fair value plus transaction costs that are directly attributable to theiracquisitions. Unrealised gains and losses arising from changes in the fair value of financial investments classified asavailable-for-sale are recognised in other comprehensive income net of tax. When financial investments classified asavailable-for-sale are sold or impaired, the accumulated fair value adjustments are included in the income statement
as net gains or losses on financial investments.

2.12.2 Loans and receivables
Loans and receivables (including deposits) are non-derivative financial investments with fixed or determinable
payments that are not quoted on an active market, other than those that Atradius intends to sell in the short term, orthat it has designated as available-for-sale. Deposits withheld by ceding companies and receivables arising frominsurance contracts are also classified in this category. Loans and receivables are initially recognised at fair value plustransaction costs and subsequently measured at amortised cost using the effective interest method, less provision for
impairment. Interest income is recognised by applying the effective interest rate, except for short-term receivables
where the recognition of interest would be immaterial.

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Atradius | Consolidated financial statements 2017 Atradius N.V.

2.13

Impairment of assets

2.13.1 Financial assets - general
At the end of each reporting period Atradius assesses, whether there is objective evidence that a financial asset orgroup of financial assets is impaired. A financial asset or group of financial assets is impaired and impairment losses
are incurred only if there is objective evidence of impairment as a result of one or more events that have occurred
after the initial recognition of the asset (a ‘loss event’) and that loss event has a negative impact on the estimatedfuture cash flows of the financial asset or group of financial assets that can be reliably estimated.
Atradius first assesses whether objective evidence of impairment exists for financial assets that are individuallysignificant. If Atradius determines that no objective evidence of impairment exists for an individually assessedfinancial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk
characteristics and assesses them collectively for impairment. Assets that are individually assessed for impairment
and for which an impairment loss is or continues to be recognised are not included in a collective assessment of
impairment.

2.13.2 Financial investments - carried at amortised cost
Objective evidence that loans and receivables are impaired can include
significant financial difficulty of the counterparty;
default or delinquency by a counterparty;
restructuring of a loan or advance by Atradius on terms that Atradius would not otherwise consider;indications that a counterparty will enter bankruptcy; orother observable data relating to a group of assets such as adverse changes in the payment status ofcounterparties; or
economic conditions that correlate with defaults.
If there is objective evidence that an impairment loss has been incurred on loans and receivables, the amount of theloss is measured as the difference between the asset’s carrying amount and estimated future cash flows. The carrying
amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in theincome statement. If a loan has a variable interest rate, the discount rate for measuring any impairment loss is thecurrent effective interest rate determined under contract. As a practical expedient, Atradius may measure impairment
on the basis of an instrument’s fair value using an observable market price.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively toan event occurring after the impairment was recognised, the previously recognised impairment loss is reversed byadjusting the allowance account. The amount of the reversal is recognised in the income statement.

2.13.3 Financial investments - carried at fair value
Atradius assesses, at the end of each reporting period, whether there is objective evidence that an available-for-salefinancial investment is impaired. Objective evidence that available-for-sale financial investments (including debt andequity securities) are impaired can include default or delinquency by an issuer, indications that an issuer will enter
bankruptcy and/or the disappearance of an active market for a security. In addition, for an investment in an equity
security, management assesses whether there has been a significant or prolonged decline in its fair value below its
acquisition cost.
Where such evidence exists for available-for-sale financial investments, the cumulative net loss that has beenpreviously recognised directly in other comprehensive income is recycled from other comprehensive income (therevaluation reserve) and recognised in the income statement. If, in a subsequent period, the fair value of debt
securities classified as available-for-sale increases and the increase can be objectively related to an event occurring
after the impairment loss was recognised in the income statement, the impairment loss is reversed through theincome statement, but only to the amortised cost price. Subsequent increases above the amortised cost price arecredited against the revaluation reserve as a component of other comprehensive income. Impairment losses
recognised in the income statement on equity securities cannot be reversed in subsequent periods.

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

2.13.4 Impairment of other non-financial assets
Assets that have an indefinite useful life, for example land, are not subject to amortisation or depreciation and aretested annually for impairment. Assets that are subject to amortisation and depreciation are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes ofassessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows(cash-generating units). Investment properties are not allocated to cash-generating units, but are tested for
impairment on an individual basis.
If in a subsequent period the amount of the impairment loss decreases and the decrease can be related objectively toan event occurring after the impairment loss was recognised in the income statement, the carrying amount of theasset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, provided that theincreased carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised for the asset (or cash-generating unit) in previous years. The amount of the reversal
is recognised in the income statement. However, impairment losses recognised for goodwill are not reversed insubsequent periods.

2.14

Offsetting financial instruments

Financial assets and liabilities are offset and the net amount is reported in the statement of financial position only
when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net
basis, or to realise the asset and settle the liability simultaneously.

2.15

Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held on call with banks and other short-term highly liquid
investments with original maturities of three months or less that are subject to an insignificant risk of changes in theirfair value, and are used by Atradius in the management of its short-term commitments. Bank overdrafts that are
repayable on demand form an integral part of Atradius’ cash management and are included as a component of cash
and cash equivalents for cash flow purposes. In the statement of financial position, bank overdrafts that do not meetthe criteria for offsetting, are presented separately as liabilities under borrowings.
Deposits pledged for regulatory and other purposes as well as cash held for investments are not available for use in
Atradius’ day-to-day operations and are therefore not included within cash and cash equivalents. These assets areincluded within financial investments.

2.16

Capital and reserves

2.16.1 Share capital
Share capital is classified as equity when there is no obligation to transfer cash or other assets. Incremental costs
directly attributable to the issue of equity instruments are shown in equity as a deduction from the proceeds, net oftax. Incremental costs directly attributable to the issue of equity instruments as consideration for the acquisition of abusiness are included in the cost of acquisition.

2.16.2 Share premium reserve
Share premium reserve is the amount received by the Company in excess of the nominal value of the shares it has
issued.

2.16.3 Revaluation reserve
The revaluation reserve comprises the unrealised gains/losses of the securities available-for-sale after the deduction
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of income tax, except for impairments that are charged directly to the income statement.

2.16.4 Currency translation reserve
The net exchange difference, after the deduction of income tax that is recognised in the currency translation reserve ineach period represents the following:-in respect of revenue, expenses and capital transactions, the difference between translating these items at
actual or average exchange rates and using the exchange rate at the end of the reporting period, which isthe case for recognised assets and liabilities;
in respect of the net assets at the beginning of the reporting period, the difference between translatingthese items at the rate used at the end of the previous reporting period and using the rate at the end of thecurrent reporting period; andin respect of the net assets acquired during the reporting period, the difference between translating these
items at the rate at acquisition date and using the rate at the end of the current reporting period.

2.16.5 Pension reserve
The pension reserve relates to the various defined benefit schemes and consists of:-actuarial gains and losses, after the deduction of income tax, that arise in calculating Atradius’ pension
obligations and fair value of the plan assets in respect of a defined benefit plan in the period in which theyoccur; andthe non-recognition of assets (‘asset ceiling’) that can occur when the plan assets are higher than the
projected benefit obligation and where Atradius cannot recover any surplus through refunds from thepensions vehicle due to solvency and/or control requirements.

2.16.6 Retained earnings
Retained earnings are the accumulated amount of profits or losses at the end of the reporting period which have notbeen distributed to shareholders.

2.16.7 Non-controlling interests
Non-controlling interests represent the proportion of shareholders’ equity and of total comprehensive income
attributable to minority shareholders.
Non-controlling interest are initially measured on the net fair value of the acquirer’s identifiable assets, liabilities andcontingent liabilities at the date of the acquisition. The calculation of the percentage attributable to the non-controllinginterest includes any equity interest not held indirectly through subsidiaries.
Non-controlling interest is presented within equity separately from the equity attributable to the equity holders of theCompany. Similarly, the statement of recognised income and expenses presents total income and expenses for theperiod showing separately the amounts attributed to the equity holders of the Company and non-controlling interests.

2.17

Subordinated debt

A subordinated debt is recognised initially at fair value, net of transaction costs incurred. A subordinated debt issubsequently stated at amortised cost. The difference between the proceeds (net of transaction costs) and theredemption value is recognised in the income statement over the fixed period of the debt during which the interest isfixed using the effective interest method. Interest payable is reported under other liabilities.

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

2.18

Insurance contracts

An Insurance contract is a contract under which one party (the insurer) accepts significant insurance risk fromanother party (the policyholder) by agreeing to compensate the policyholder or its beneficiary if a specified uncertain
future event (the insured event) affects the policyholder.
The insurance contracts issued by Atradius can be classified into two main categories:--

Credit insurance contracts: contracts that provide for specific payments to be made to reimburse theholder for the loss it incurs because a specified debtor fails to make a payment when due under theoriginal or modified terms of the contract between the debtor and Atradius’ insured customers; andBonding contracts: contracts that provide compensation to the beneficiary of the contract if Atradius’
bonding customer fails to perform a contractual obligation relative to the beneficiary.

The company applies IFRS 4.25, which allows existing insurance accounting practices to continue. The main item isthat the local business in Spain and Portugal applies existing earnings and related provisioning practices. The
differences in application lead to different allocations of unearned premium and provision for outstanding claims.
Further reference is made to specific information included on ACyC in Note 4.2.6 and Note 18.

2.18.1 Deferred acquisition costs
Commission costs that vary with and are related to securing new contracts and renewing existing contracts arecapitalised as deferred acquisition costs. All other costs are recognised as expenses when incurred. The deferredacquisition costs are subsequently amortised over the life of the policies as premium is earned.

2.18.2 Provision for unearned premium
The recognition of unearned premium per product is set out in Note 4.2.6.1.

2.18.3 Provision for outstanding claims
Claims and loss adjustment expenses are charged to the income statement as incurred based on the estimated liability
for compensation owed to contract holders. They include direct and indirect claims settlement costs and arise from therisks Atradius has assumed up to the end of the reporting period. Atradius does not discount its liabilities (other than
the recoveries on the Instalment Credit Protection (ICP) product) given the short-term nature of its liabilities.
Liabilities for unpaid claims are estimated using the input of assessments for individual cases reported to Atradius andstatistical analyses for the claims incurred but not reported. When appropriate, deductions are made for salvage,
subrogation and other expected recoveries from third parties. For reinsurance business the provisions are determinedtreaty-by-treaty, based on premium and loss information supplied by the ceding companies. Estimates of expected
losses are developed using historical claims experience, actual versus estimated claims experience and other known
trends and developments.
Additional information on the measurement of the provision for outstanding claims is provided in Note 4.2.6.

2.18.4 Liability adequacy test
At the end of each reporting period, a liability adequacy test is performed to ensure the overall adequacy of the total
insurance contract liabilities, net of related deferred acquisition costs. In performing this test, current best estimates of
future contractual cash flows and claims handling expenses are used. Any deficiency on consolidated level isimmediately charged to the income statement by first writing down the related deferred acquisition costs and then by
establishing a provision for losses arising from the liability adequacy test.

2.18.5 Reinsurance contracts
Contracts entered into by Atradius with reinsurers, under which Atradius is compensated for losses on one or more
contracts it has issued and that meet the classification requirements for insurance contracts, are classified as
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reinsurance contracts held. Contracts that do not meet the classification requirements are classified as financial assets.
Insurance contracts entered into by Atradius under which the contract holder is another insurer (reinsurance
business) are included in insurance contracts.
The benefits to which Atradius is entitled under its reinsurance contracts held are recognised as reinsurance assets.
These assets consist of short-term balances due from reinsurers (classified within loans and receivables), as well as
longer term receivables (classified as reinsurance contracts) that are dependent on the expected claims and benefits
arising under the related reinsurance contracts. Amounts recoverable from or due to reinsurers are measured
consistently with the amounts associated with the reinsured insurance contracts and in accordance with the terms ofeach reinsurance contract. Reinsurance liabilities are primarily premium payable for reinsurance contracts and arerecognised as an expense when due.
Atradius assesses its reinsurance assets for impairment on a quarterly basis. If there is objective evidence that thereinsurance asset is impaired, Atradius reduces the carrying amount of the reinsurance asset to its recoverable
amount and recognises that impairment loss in the income statement. Atradius gathers the objective evidence that areinsurance asset is impaired by applying procedures similar to those adopted for financial assets held at amortised
cost. The impairment loss is calculated under the same method used for these financial assets.
Atradius has profit commission arrangements with its reinsurance companies that are based on the loss ratio perunderwriting year. Atradius accounts for these commissions based on detailed assessments of the expected ultimate
loss ratios.
Atradius recognises the gains and losses from reinsurance contracts directly in the income statement.

2.18.6 Receivables and payables related to insurance contracts
Receivables and payables are recognised when due. These include amounts due to and from agents, brokers andinsurance contract holders.
If there is objective evidence that the insurance receivable is impaired, Atradius reduces the carrying amount of theinsurance receivable accordingly and recognises that impairment loss in the income statement. Atradius gathers theobjective evidence that an insurance receivable is impaired by applying procedures similar to those adopted for loans
and receivables. The impairment loss is also calculated under the same method used for these financial assets.

2.18.7 Salvage and subrogation reimbursements
Some insurance contracts permit Atradius to sell goods acquired in settling a claim (i.e., salvage). Atradius may also
have the right to pursue third parties for payment of some or all costs (i.e., subrogation).
Estimates of salvage recoveries and subrogation reimbursements are included as an allowance in the measurement of
the provision for claims. The allowance is the amount that can reasonably expected be to be recovered.

2.19

Provisions

Provisions for restructuring, onerous contracts and litigation are recognised when Atradius has a present legal orconstructive obligation as a result of past events and it is more likely than not that an outflow of resources will be
required to settle the obligation and the amount has been reliably estimated.
Restructuring provisions include employees’ termination payments that are directly related to restructuring plans.
Provisions are not recognised for future operating losses. Where there are a number of similar obligations, thelikelihood that an outflow will be required in settlement is determined by considering the class of obligations as awhole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the sameclass of obligations may be small. Where the effect of the time value of money is material, the provision is measured as
the present value of the expenditure expected to be required to settle the obligation discounted using a pre-tax rate.

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All amounts in thousands of Euro, unless otherwise stated

2.20

Deposits received from reinsurers

Deposits received from reinsurers represent amounts received from reinsurance companies in respect of ceded claims
and premium provisions and are stated at amortised cost using the effective interest method. Interest expense isrecognised on an effective yield basis, except for short-term deposits where the impact of interest would be
immaterial.

2.21

Employee benefits

2.21.1 Post-employment benefits
Atradius has a number of post-employment benefit plans. The schemes are determined by periodic actuarial
calculations and are generally funded through payments to state plans, insurance companies or trustee-administeredfunds. Atradius has both defined benefit plans and defined contribution plans.
Defined benefit plans
A defined benefit plan is a pension plan that defines an amount of pension benefit that an employee will receive on
retirement, dependent on one or more factors such as age, years of service and compensation. In a defined benefit plan
Atradius may pay contributions into a separate entity or fund. Atradius, and in some cases the employees who areparticipating, fund a defined benefit plan and Atradius has a legal or constructive obligation to pay further
contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service
in the current and previous periods.
The amount recognised as a defined benefit liability is the net total of the present value of the defined benefit
obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (ifany) out of which the obligations are to be settled directly. The recognition of assets that arise by over-funding of thedefined benefit plan is limited to the ability to use the surplus to generate future benefits (the asset ceiling). The
defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The
present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using
interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid
and that have terms of maturity that approximate to the terms of the related pension liability.
Remeasurement of the net defined benefit liability, which comprises actuarial gains and losses, the return on plan
assets (excluding net interest that is calculated by applying the discount rate) and the effect of the asset ceiling (if any,excluding interest), is recognised immediately in other comprehensive income. Atradius determines the net interest
expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used tomeasure the defined benefit obligation at the beginning of the annual period to the then net defined benefit liability(asset), taking into account any changes in the net defined benefit liability (asset) during the period as a result ofcontributions and benefit payments. Net interest expense and other expenses related to defined benefit plans arerecognised in the income statement.
The non-recognition of assets (‘asset ceiling’) can occur when the plan assets are higher than the projected benefit
obligation and Atradius cannot recover any surplus through refunds from the pension vehicle due to solvency and/or
control requirements.
When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past
service or the gain or loss on curtailment is recognised immediately in the income statement. Atradius recognises
gains and losses on the settlement of a defined benefit plan when the settlement occurs.
Defined benefit costs are categorised as follows:-

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

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The first two components of defined benefit costs are presented in the income statement under net operating
expenses. The net interest is presented under finance expenses. Curtailment gains and losses are accounted for as past
service costs. Remeasurements are recognised in other comprehensive income.
Defined contribution plans
Defined contribution plans are post-employment benefit plans under which Atradius pays fixed contributions into aseparate entity (a fund) and will have no legal or constructive obligation to pay further contributions if the fund does
not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods.
For defined contribution plans, Atradius pays contributions to publicly or privately administered pension insurance
plans on a mandatory, contractual or voluntary basis. Atradius has no further payment obligations once thecontributions have been paid. The contributions are recognised as employee benefit expenses when they are due.
Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments
is available. The contributions to these plans are recognised as expenses in the income statement.

2.21.2 Other long-term employee benefits
Atradius has a number of other post-employment plans. The main plans are lump sum payment plans and prepension plans. A lump sum payment plan is a plan where the employees are entitled to a lump sum payment at thedate their employment is terminated. A pre-pension plan is a plan where the employees are entitled to receive
payments if they stop working before their actual retirement date.
Atradius’ net obligation in respect of long-term service benefits, other than pension plans, is the amount of future
benefit that employees have earned in return for their service in the current and prior periods. The net obligation is
calculated annually by independent actuaries using actuarial techniques.

2.21.3 Termination benefits
Termination benefits are payable when employment is terminated before the normal retirement date, or whenever an
employee accepts voluntary redundancy in exchange for these benefits. Atradius recognises termination benefits
when it is demonstrably committed to either terminating the employment of current employees according to adetailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made toencourage voluntary redundancy. When termination benefits are related to an overall restructuring plan, the Atradiusliability is included as part of the provisions.

2.21.4 Profit sharing and bonus plans
Atradius recognises a liability and an expense for bonuses and profit sharing based on a formula that takes into
consideration, amongst other things, individual targets and the profit attributable to the owners of the Company.
Atradius recognises a liability where contractually obliged or where there is a past practice that has created aconstructive obligation.

2.22

Taxation

Income tax in the consolidated income statement for the year comprises current and deferred tax. Income tax isrecognised in the consolidated income statement except to the extent that it relates to items recognised in othercomprehensive income, in which case it is recognised in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income for the year, using tax rates enacted or
substantively enacted at the end of the reporting period, and any adjustment to tax payable in respect of previous
years.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred income
tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the end of the73

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All amounts in thousands of Euro, unless otherwise statedreporting period and are expected to apply when the related deferred income tax asset is realised or the deferredincome tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available
against which the temporary differences can be used. Deferred tax assets and liabilities are offset when there is alegally enforceable right to set-off current tax assets against current tax liabilities and when they relate to income
taxes levied by the same tax authority and Atradius intends to settle its current tax assets and liabilities on a net basis.
If the deferred income tax arises from initial recognition of an asset or liability in a transaction other than a businesscombination that at the time of the transaction affects neither the accounting nor the taxable profit or loss, it is notaccounted for.

2.23

Consolidated income statement

2.23.1 Income
Revenue comprises the fair value for services, net of value added tax, after eliminating revenue within Atradius.
Revenue is recognised as follows:
Premium earned
Written premium includes both direct business and reinsurance business and is defined as all premium and policyrelated fees invoiced to third parties and reinsurance premium, excluding tax.
Written premium includes an estimate of premium not yet invoiced for which Atradius has already accepted thecontractual risk. Accruals for premium refunds and cancellations are charged against premium written. Premium
earned includes an adjustment for the unearned share of premium.
Premium ceded under reinsurance contracts is reported as a reduction of premium earned. Amounts for ceded
unearned premium under cession agreements are reported as assets in the consolidated statement of financial
position.
Service and other income
Service income includes the income from information services, collections and activities carried out as an agent onbehalf of the Dutch State. This income is recognised as the service is provided.
Share of income of associated companies
Associates are accounted for in the consolidated financial statements using the equity method. Under the equity
method the investor’s share of after-tax profits or losses of the associates is presented as a single line item in theincome statement.
Net income from investments
Investment income comprises interest income on funds invested (including available-for-sale financial investments),
dividend income, gains on the disposal of available-for-sale financial investments and rental income from investment
property that are recognised in the income statement. Interest income is recognised as it accrues in the income
statement, using the effective interest method. Dividend income is recognised in the income statement on the date that
Atradius’ right to receive payment is established, which in the case of quoted securities is the ex-dividend date.
Investment expenses comprise impairment losses recognised on financial investments and investment property.
Realised gains or losses on investment property recognised in the income statement represent the difference between
the net disposal proceeds and the carrying amount of the property.

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2.23.2 Expenses
Net insurance claims
Claims charges include claims paid, the change in provision for outstanding claims, and the claims handling expenses.
Claims ceded under cession contracts are recorded as reductions of gross claims.
Net operating expenses
Net operating expenses comprise administrative expenses and commissions. Total administrative expenses are
expenses associated with selling and administrative activities after reallocation of claims handling expenses toinsurance claims.
Finance income and expenses
Finance income consists of interest received on loans, receivables and cash and cash equivalents.
Finance expenses includes interest, amortisation of discount on the subordinated debt, foreign exchange results andthe net interest on the net defined benefit liability (asset) related to defined benefit plans (see also Note 2.21). Foreign
currency gains and losses are reported on a net basis and consist of transaction and translation results.
Interest income and expenses are calculated using the effective interest rate method based on market rather than
nominal rates, at the date that the instrument is recognised initially or modified.

2.24

LeasesLeases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as
operating leases.

2.24.1 Atradius as lessor
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial
direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased
asset and recognised on a straight-line basis over the lease term.

2.24.2 Atradius as lessee
Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except whereanother systematic basis is more representative of the time pattern in which economic benefits from the leased asset
are realised. Contingent rentals arising under operating leases are recognised as an expense in the period in which
they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as aliability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis,
except where another systematic basis is more representative of the time pattern in which economic benefits from theleased asset are realised.

2.25

Consolidated statement of cash flows

The statement of cash flows is presented using the indirect method, whereby the result for the year before tax isadjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash
receipts or payments, and items of income or expense associated with investing or financing cash flows.
Some of the terminology used in the statement of cash flows is explained as follows:-

Cash flows are inflows and outflows of cash and cash equivalents;

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All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated--Operating activities are the principal revenue-producing activities of Atradius and other activities that are
not investing or financing activities;
Investing activities are the acquisition and disposal of long-term assets and other investments not included
in cash equivalents; andFinancing activities are activities that result in changes in the size and composition of the contributed
equity and borrowings of Atradius.

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3 Critical accounting estimates and judgements in applying accounting
policies
Atradius makes estimates and assumptions that affect the reported assets and liabilities and contingent assets andliabilities. Estimates and judgements are continually evaluated. These are based on historical experience and otherfactors, including expectations of future events that are believed to be reasonable under the circumstances. The mostsignificant areas for which management is required to make judgements and estimates that affect reported amounts
and disclosures are detailed below.

3.1

Measurement of fair value

Atradius measures some of its financial instruments at fair value for financial reporting purposes. The fair value offinancial instruments that are not traded in an active market is determined by using valuation techniques. Atradiususes its judgement to select a variety of methods and make assumptions that are mainly based on market conditions
existing at the end of each reporting period. Where Level 1 inputs are not available, Atradius engages an external
independent valuation company to perform the valuation. Atradius works together with the external independentvaluation company to establish the appropriate valuation techniques and inputs to the model.
Information about the valuation techniques and inputs used in determining the fair value of various instruments aredisclosed in Note 4.3.1.1 and Notes 7 and 16.

3.2(Re-)insurance related estimates

The ultimate liability arising from claims made under insurance contracts
The estimate of the ultimate liability arising from claims including recoveries made, or to be made, under insurance
contracts is Atradius’ most critical accounting estimate. Although management has endeavoured to adequately take all
facts into account, by their very nature estimates remain uncertain and the eventual outcome may differ significantly
from the projected amount.
Pipeline premium
Pipeline premium is estimated as the part of insurance premium earned but not yet invoiced at the end of thereporting period. Although the calculation of the pipeline premium is derived from the core business systems andcalculated at policy level, the calculation does involve the use of management estimates.
Sliding scale reinsurance commission
Reinsurance commission related to Atradius’ quota share treaties is calculated and accounted for at a provisional rate
but reviewed against the development of the ultimate loss ratio as soon as an underwriting year matures. The sliding
scale commission (an additional income or expense on top of the provisional commission) is based on an estimate bymanagement of the ultimate loss ratio for an underwriting year.

3.3

Impairment of available-for-sale equity financial investments

Atradius determines that an available-for-sale equity financial investment is impaired when there has been asignificant or prolonged decline in the fair value below its cost. This determination of what is significant or prolonged
requires judgement. In making this judgement, Atradius evaluates among other factors, the normal volatility in shareprice, the financial health of the investment, industry and sector performance, changes in technology and operationaland financing cash flows. Impairment may be appropriate when there is evidence of deterioration in the financial
health of the investment, industry and sector performance, changes in technology, and financing and operational cash
flows.
Had all the declines in fair values below cost been considered significant or prolonged Atradius would have anadditional EUR 3.5 million loss before tax (2016: EUR 5.9 million loss), being the transfer of the total revaluation
reserve for unrealised losses on equity financial investments to the income statement.

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77All amounts in thousands of Euro, unless otherwise stated

All amounts in thousands of Euro, unless otherwise stated

3.4

Estimated impairment of goodwill

In accordance with its accounting policy, Atradius annually tests whether goodwill has suffered any impairment. The
recoverable amounts of cash-generating units have been determined based on value in use calculations. These
calculations require the use of estimates (see Note 6).
In order to test the value in use against the recognised goodwill, Atradius has stress-tested the main assumptions(discount rate and combined ratio of terminal value) which have been applied when determining the value in use forthe related cash-generating units. Increasing both assumptions downward and upward by 1% respectively did notindicate any potential impairment of the goodwill under this scenario. The term ‘potential’ is used here since anindication of impairment does not always lead to an actual impairment charge to the income statement.

3.5

Pension and post-retirement benefits

The present value of the pension obligations depends on a number of factors that are determined on an actuarial basis
using a number of assumptions. The main assumptions used in determining the net cost (income) for pensions
includes the discount rate and the inflation rate. Any change in these assumptions will impact the carrying amount ofpension obligations.
Atradius determines the appropriate discount rate at the end of each year. This is the interest rate that should be used
to determine the present value of estimated future cash outflows expected to be required to settle the pension
obligations. In determining the appropriate discount rate, Atradius considers the interest rates of high-quality
corporate bonds that are denominated in the currency in which the benefits will be paid and that have terms tomaturity approximating the terms of the related pension obligation. Other key assumptions for pension obligations
are based in part on current market conditions.
Additional information, including a sensitivity analysis for the main (actuarial) assumptions, is disclosed in Note 17.

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4

Risk and capital management

4.1

Risk management

As a global insurance provider, Atradius recognises the importance of risk management. Atradius maintains a strong
governance and associated internal control system within the organisation. As a self-learning organisation and basedon additional regulatory requirements. Atradius continues to strengthen its risk management capabilities bybroadening risk management scope and enhancing existing risk management tools.
The relationship between risk and capital is fundamental for Atradius. Understanding how risk-taking consumes
capital allows management to steer Atradius and take strategic decisions with the interdependence of risk and capitalin mind. These decisions are increasingly informed by the outcomes of Atradius’ economic capital model. This
internally developed model, which has received supervisory approval for use in calculating regulatory capitalrequirements, contributes to a multitude of risk assessment activities, as well as risk profile measurement, and allows
Atradius to better monitor and manage risk levels within the organisation through the allocation of risk-based capital.
Moreover, risk management, risk profile measurement and implicitly the relationship between risk and capital play acentral role in the European regulatory regime, Solvency II.

4.1.1 The risk landscapeThe state of the global economy greatly influences the risks that Atradius faces. Economic deterioration may result inhigher insolvencies causing more frequent and severe claims expenses. In addition, a deterioration may lower ourrevenues as they are strongly correlated to global trade. The return on our investment may also deteriorate anddefaults on our holdings of debt instruments may occur. A severe deterioration of all the above mentioned may impact
the credit rating of Atradius. A downgrade of our credit rating could have a potential negative impact on the number ofcustomer policies held by Atradius. This might further lower revenues.

4.1.2 The risk management and internal control framework
The boards of the group companies have ultimate responsibility and accountability for risk management and internal
control within their respective companies. Atradius N.V.’s Management Board owns, implements and oversees
Atradius group-wide risk governance through the Risk Strategy Management Board (RSMB). The RSMB consists of all
members of the Management Board, as well as the Directors of Group Risk Management, Strategy and Corporate
Development and Finance. The RSMB’s responsibilities include the development of the framework to manage risk andthe on-going overview of the largest risks. The RSMB establishes the internal risk control system by determining risk
control policies, risk boundaries, and by prescribing risk mitigation activities. In addition, the RSMB ensures that there
are processes and systems to review the effectiveness of risk management and the internal control system.
The Supervisory Board is responsible for overseeing that the Management Board implements, amongst other things, a
suitable risk management and internal control system. In this respect, the Management Board, alongside its risk
management functions, periodically presents results, developments and plans to the Supervisory Board and relevant
committees thereof. One of these committees, the Audit Committee, supervises, monitors and advises the Management
Board on the effectiveness of internal risk management and control systems. The Audit Committee is assisted in thisrole by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls andprocedures, the results of which are reported to the Audit Committee.
Atradius’ risk management policies are established to identify and analyse the risks faced by Atradius, to set
appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies andsystems are reviewed regularly to reflect changes in market conditions and Atradius’ activities. Through its training
and management standards and procedures, Atradius aims to develop a disciplined and constructive control
environment in which all employees understand their roles and obligations.
Central to Atradius’ system of governance is the Atradius risk governance structure. The risk governance structure
comprises a framework of committees (which support RSMB in specific risk areas), approval authorities, roles andresponsibilities and risk boundaries which combine to define the process by which Atradius decides what risks ittakes on and how it manages those risks.

7979All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

By applying the Atradius risk governance structure, Atradius is able to:Communicate risk-related norms and values across the organisation;
Provide clarity over the various responsibilities and accountabilities in the management of risk;
Manage the Group’s risk profile and development of the business over time;
Ensure that Atradius adheres to an approved risk appetite;
Ensure appropriate ownership of decisions; andProvide the Management Board with clear lines of sight into decision-making and risk-management
processes.

4.1.3 Risk classification
Atradius classifies its main risk types as insurance, financial and operational. Insurance risks are the risks of financial
loss as a direct result of providing insurance; these arise predominantly from the risk of non-payment by a buyer
covered by a policy (credit insurance) or the risk of non-performance by a customer (bonding). Financial risks include
market risk, credit risk and liquidity risk. Operational risks arise from inadequate or failed internal processes, people,
systems, or applicable loss from external events.

4.2

Insurance risk

4.2.1 Insurance products, their characteristics, sensitivity to insurance risk, risk mitigation and controls
Atradius operates with two main direct insurance product lines: credit insurance and bonding. In addition, Atradiusalso writes credit and surety business as a reinsurer. Credit insurance can be divided into three subcategories:
traditional credit insurance, instalment credit protection and special products. Each of these sub-categories has
particular risk characteristics.
The starting point for the management of insurance risk is that all staff have well-defined authorities specifying thelevel of risk they can accept and that all risk acceptance must take place within the framework of the risk governancestructure described in Note 4.1.2. The main elements of the risk governance structure currently in place are described
below. Furthermore, Atradius’ reinsurance structure imposes checks on the largest exposures. Exposures beyond acertain threshold are subject to special acceptance by our leading reinsurers.
Traditional credit insurance and special products
In traditional credit insurance, Atradius 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 socalled ‘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 covernon-payment of trade receivables due to commercial disputes. Each policy stipulates a maximum credit period thatthe policyholder can offer to its buyers without prior approval from Atradius. ‘Buyers’ are the customers of Atradius’
insured customers, i.e., the parties that Atradius insures credit risk on. In order to mitigate the risk of adverse
selection, the traditional credit insurance products of Atradius usually cover the entire portfolio of buyers of a policy
holder.
For traditional credit insurance, there are two underwriting processes: policy underwriting and buyer underwriting.
Policy underwriting is the process by which Atradius decides which companies to accept as policyholders and theterms and conditions of cover that are offered. Buyer underwriting is the process by which Atradius sets risk limits foreach buyer and issues credit limits, thus managing risk on existing policies. Policy underwriting takes place in theCommercial units and buyer underwriting in the Risk Service units.
Policies are issued for a fixed period: usually no longer than three years. Normally, customers retain some of the risk
for their own account to protect Atradius from the risk of moral hazard. That self-retention can take the form, forexample, of an uninsured percentage, a deductible on each claim, an aggregate first loss amount or a combination ofthese. Almost all policies stipulate Atradius’ maximum liability. A customer is covered for the credit risk on a buyer
after a credit limit on the buyer has been established. Most policies allow customers to establish credit limits
themselves for smaller amounts, under conditions specified in the policy. Larger credit limits must be issued by
Atradius. Credit limits are an important risk management instrument for Atradius as they cap the amount that
Atradius would have to pay to a customer in the event of a claim. Moreover, Atradius can, in principle, withdraw the80

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credit limit on a buyer at any time if circumstances demand. Credit limits may be subject to specific conditions andAtradius 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 authorities specifying who can underwrite which policies. Authorities
typically require the approval of two people and conditions become stricter as policy amounts become larger, with thelargest policies needing sign-off by both the Director of a Commercial unit and the responsible Management Board
member. The pricing of credit insurance policies, new and renewed, is also subject to governance and themethodologies used to establish a benchmark price require the approval of the Quantitative Model Committee, acommittee responsible for approving quantitative models used within the group.
Staff in Risk Services have well-defined authorities specifying who can set what capacity on a buyer and who canapprove what credit limits. As credit amounts grow, decisions require the approval of one or more cosignatories ofincreasing seniority. The largest credit amounts require the approval of the Atradius credit committee with theappropriate authority level.
The special products business offers a range of bespoke policies to insure against various credit and political risks; thisproduct line includes policies that cover single transactions, single trade relationships and asset confiscation. A
distinguishing feature of special products policies is that, unlike traditional credit insurance, credit limits typicallycannot be readily withdrawn. The conditions of special products policies tend to place a greater onus on risk
monitoring and due diligence on the insured.
All policies are bound within clearly defined authorities issued to the policy underwriters who report ultimately to theChief Market Officer. All buyer risk is signed off by dedicated Risk Services teams which have a separate and distinct
reporting line to the Chief Risk Officer. In addition, a dedicated risk management team with a functional reporting line
to the Director. Group Risk Management ensures adherence to the risk governance model monitors the portfolio risk
and ensures compliance with the terms of the reinsurance treaty.
Bonding
Atradius issues surety bonds for customers in a number of European countries including Italy, France, Spain, Portugal,
Germany and 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, local governments and tax
authorities as well as companies.
While our customer may fail to meet its obligations either because it is unable to perform to the agreed or required
level or because it is insolvent, there is also the risk that the customer may intentionally fail to meet its obligations.
Therefore, our assessment of both the customer’s financial strength and its ability to perform plays an important partin the underwriting process. Unlike traditional credit insurance, exposure related to issued bonds cannot be
unilaterally cancelled by Atradius.
When a bond is called by the beneficiary, Atradius mediates to resolve conflicts by working with both customer andbeneficiary. If, as a result of non-performance a payment is made by Atradius to the beneficiary, a recovery action istaken against the customer who remains ultimately liable. If Atradius does incur 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 spread of customers over industry sectors varies by country as a result of differing legal and market
environments. The type of bonds issued include bid bonds, performance bonds, maintenance bonds, advance payment
bonds and various types of administrative bonds. These are issued with tenors ranging from a few weeks to years, but
only rarely in excess of five years.
All bonding facilities and individual bonds are underwritten by technical underwriters who are part of theCommercial units. Technical underwriters assess the risk of non-performance as well bonding wordings and othertechnical aspects. Financial underwriters, who are not part of the Commercial units, focus on the credit risk-related
aspects of customers; they must approve the acceptance of facilities and individual bonds over certain thresholds.
There is an authority structure in which decisions are escalated depending on the amounts involved. The largest
amounts require the approval of Atradius credit committee with the appropriate authority level.

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All amounts in thousands of Euro, unless otherwise stated

Other products
Reinsurance
Atradius underwrites reinsurance programmes for the credit insurance and bonding business written by primary
insurers. This business is conducted by Atradius Re, domiciled and regulated in Ireland.
Atradius Re provides reinsurance capacity for primary insurance companies from both the developed and developing
credit insurance and bonding markets. It currently assumes business from over 50 countries worldwide, maintaining
a balanced diversity within the portfolio from each continent. The underlying business consists of approximately 58%
credit insurance and 42% bonding, based on premium volume.
Reinsurance underwriting guidelines and risk boundaries define the kind of business Atradius Re is authorised towrite, with specific guidelines to type of product, capacity limit, exposure, term and diversity of the underlying
insurance ceded. Particular attention is given to ensuring the diversity of business from third party clients and thelevel of exposure to any one country, company, or market is managed within agreed underwriting limits and capacity.
All reinsurance business is regularly reviewed with respect to past underwriting years’ performance, triangulation
development, individual buyer exposure development, aggregate total potential exposure management and market
and country exposure. Risk and policy limit setting is monitored to ensure credit quality and performance of theunderlying insurance products to reinsurance terms agreed with third party clients.
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 andLuxembourg.
Policy underwriting is performed within the Commercial 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 Atradius.
Risk underwriting is performed by the risk underwriting teams. Credit decisions are made for each individual
operation based on an automated decision model. The model, without human intervention, can refer the case to anunderwriter for manual assessment. Authorities are granted to underwriters according to their seniority andexpertise. Cases are escalated according to pre-determined thresholds to the local ICP credit committees, then to the
ICP credit committee and finally to the Management Board member responsible for instalment credit protection.

4.2.2 Insurance risk management tools
Atradius monitors exposure across various dimensions such as counterparty, industry sector and geographic location.
We maintain records of all credit insurance policies, credit limits and buyers in various connected systems. Thesesystems enable Atradius to set system specific limits by buyer or buyer group. Management information derived fromthese systems enables Atradius to monitor aggregate exposure by country, customer, industry sector and otherdimensions.
All buyers with significant exposure are reviewed at least annually. Atradius continually receives information onbuyers through on-line connections with business information providers and from customers reporting negative
payment experiences. Buyers are reviewed whenever pertinent new information is received. Atradius assigns aninternal rating to buyers and the review process takes into account exposure on a buyer through direct business,
including exposure for special products and bonding. The authority structure for approval of new exposure referred toin this note also applies to buyer reviews.
The main system includes an integrated risk and cost-based pricing system. Most new policies and non-tacit renewals
are priced starting from a price suggested by the pricing system.
For reinsurance, Atradius Re uses a number of risk management tools to monitor the reinsurance portfolio for
exposures and performance developments. The reinsurance system is used to record the risk profile, ultimate estimate
and related accounting information for each reinsurance treaty. This allows the reporting of performance, total

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aggregate exposure and accounting reinsurance result. Performance development and exposures related to eachreinsurance treaty are reviewed quarterly within certain limits and through exception reporting.
For ICP, consumer credit risk underwriting relies on the databases of the relevant national authorities. In Belgium, theNational Bank of Belgium maintains two databases: a negative database, listing every credit non-payment incident,
and a positive database, listing every credit granted to any individual. In addition, ICP maintains and uses its own
internal consumer credit database.
Both Bonding and ICP have their own pricing systems and guidelines, which reflect the specifics of their businesses.

4.2.3 Reinsurance programme
Atradius transfers a significant portion of its insurance risk to external reinsurers, through a number of reinsurance
arrangements that include quota share and excess of loss treaties covering either the entire portfolio of Atradius or
specific risks. Traditionally the reinsurance treaties are usually renewed annually, however at the end of 2015 it was
decided to renew on a two year basis (comprising of two separate underwriting years), this report therefore covers thesecond year of that two year period. During 2017, Atradius renewed its reinsurance arrangements for 2018. On
renewal, Atradius assesses the optimal structure of the treaties for the forthcoming period, including the excess of loss
treaties (the attachment points, spread of the layer and the number of reinstatements). A number of items are taken
into consideration during this review, including the cost of the synthetic capital that reinsurance provides asmeasured by the economic capital model and also the impact on the Solvency II Capital charge under the standard
formula of the various reinsurance proposals.
For the underwriting years 2016 and 2017 one quota share reinsurance treaty is in place covering the majority ofAtradius’ business. The retention under this treaty is 57.5%.
In addition, there is a separate quota share treaty which covers a limited number of policies, where the retention
percentage is 25%. In addition, there is a single excess of loss programme, covering the own retention under these
quota share treaties, consisting of a series of excess of loss treaties (per buyer group) and an aggregate stop loss treaty.
These excess of loss treaties also provide protection for the assumed business of Atradius Re . The combined excess ofloss programme for Atradius has mitigated the likelihood of it retaining two separate retentions if a common buyer
were to fail, impacting both the assumed and direct business of Atradius. 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 of any single buyergroup will exceed the top end of the excess of loss coverage purchased.
The attachment point of the excess of loss treaties has been set such that the net retention for business ceded underthe quota share treaties and excess of loss structure for any buyer group does not exceed EUR 25 million for Atradius.
Atradius Rei has also purchased additional lower level protection.
With regard to the reinsurance panel, it is Atradius’ policy to select only reinsurers that have a high quality standard ofsolvency/rating. The normal minimum requirement is an ‘A-’ level rating. The treaties also include a provision that if areinsurer is downgraded during the period of the reinsurance below an A- rating then security can be requested and if
not provided the reinsurance agreement with that reinsurer can be terminated.

4.2.4 Concentration risk
Atradius is exposed to concentration risk in a number of ways: primarily by buyer, buyer’s country or buyer’s
industry. The following tables illustrate the exposure at the end of 2017 and 2016 in terms of the sum of credit limits
registered by Atradius on individual buyers. This is referred to as total potential exposure or TPE.
TPE is an approximate upper boundary to real exposure, in the sense that a limit that Atradius has issued does notnecessarily give rise to credit risk at a specific point in time. Atradius normally does not know the real outstanding
exposure under its limits on any specific buyer. The ‘usage’ of limits is, on average, much smaller than the amount of
the limit. At the portfolio level, real outstanding exposure tends to be in the range of 10% to 30% of TPE, on top of whichcustomers still have their own retention. In addition to the TPE, customers are often allowed to bring exposure under
the policy through discretionary limits and potential exposure resulting from a discretionary limit on any buyer is notheld on Atradius’ system. Each policy specifies the maximum discretionary limit allowed under the policy and, for83

83All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedmost policies this is no more than EUR 20 thousand per buyer. This illustrates that TPE is a crude measure of exposureand that, in aggregate, real exposure will be far lower.
The TPE details below show TPE gross of reinsurance; due to the non-linear nature of the excess of loss cover in
Atradius’ reinsurance programme, which has a finite number of reinstatements for each layer, there is no natural way
to show TPE net of reinsurance.
In the following tables, the TPE has been aggregated and shows the exposure for credit insurance (including special
products and reinsurance). Germany, Spain and Portugal constitute more than 29% of the overall exposure.
Buyer country

TPE 2017(EUR million)%

TPE 2016(EUR million)%

Spain, Portugal

98,71415.8%

93,437

15.9%

Germany

86,43013.9%

82,783

14.1%

Central and Eastern Europe

59,253

9.5%

55,098

9.4%

USA49,228

7.9%

48,956

8.3%

France44,854

7.2%

43,323

7.4%

United Kingdom

43,537

7.0%

39,779

6.8%

Italy

42,242

6.8%

37,208

6.3%

The Netherlands

27,636

4.4%

25,268

4.3%

Nordic26,390

4.2%

24,838

4.2%

Other

144,54523.2%

136,414

23.3%

Total

622,829100%

587,104

100%

The following table shows the distribution of TPE over buyer industry sector. In terms of Industry Sectors the mainbuyer sectors we provide cover on are Chemicals, Electronics, Consumer durables and Metals, which constitute morethan 46% of the exposure in 2017. The remaining exposure is distributed across Food, Transport, Construction,
Machines, Agriculture, Construction materials, Services and other sectors.
Industry sector

TPE 2017(EUR million)

TPE 2016(EUR million)

Chemicals

82,78378,593

Electronics

74,47670,510Consumer durables

68,44265,324

Metals63,41958,855Food

58,60855,640Transport

56,93053,434

Construction

46,896

43,133

Machines

37,137

34,734Agriculture

33,31830,907

Construction materials

27,05825,387

Services

26,99425,276

Other

46,76845,311

Total

622,829

587,104

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The following table shows TPE aggregated by group of buyers. This is the method of aggregation that is relevant for
Atradius’ excess of loss treaties. For instance, assuming real outstanding exposure of 20% of TPE, then only buyers
with TPE in excess of around EUR 125 million could give rise to a hit to an excess of loss treaty (2016: the same).
Value band

TPE 2017

TPE 2016(EUR million)(EUR million)

0 - 20339,174

331,385

20 - 100

107,227

99,785100 - 250

66,82459,545250 - 500

46,08042,968500 - 1000

33,85823,7601000 - and more

29,666

29,661

Total

622,829

587,104(EUR million)

Exposure for bonding and for instalment credit protection has different characteristics and therefore has not been
included in these tables. The bonding exposure is EUR 23.4 billion (2016: EUR 22.7 billion). Exposure for instalment
credit protection amounts to EUR 2.5 billion (2016: EUR 2.3 billion).

4.2.5 Factors affecting the frequency and severity of claims
The frequency and severity of claims are affected by several factors. These include all factors that affect credit risk ingeneral. Thus the status of the economy is a major driver of the frequency and severity of claims. Its effect may varyby country and sector. For trade credit risk, the behaviour of customers may also affect the frequency and severity ofclaims, for instance through risks inherent to their business activities and their risk management practices. Specific
events (e.g. natural disasters) or structural changes in the economy (e.g. easier access to developed markets for
producers in low cost countries), may impact the frequency and severity of claims. What specific events or structuralchanges are relevant in this respect will vary over time. In addition, the political risk cover that Atradius provides has
its own dynamics of frequency and severity of claims.
The bonding business usually only incurs irrecoverable losses when, after a bond call, any payments to beneficiaries
cannot be reclaimed from the bonding customer, or its guarantors. This is almost always due to either the insolvency
or bankruptcy of the bonding customer. Thus, in the end, the frequency and severity of claims is affected by similar
factors as those affecting 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.

4.2.6 Sources and assumptions
4.2.6.1

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 factorsthat affect the frequency and severity of claims in general, as described in Note 4.2.5.
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 theprovisions 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:85

85

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

-

-

-

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 noclaims 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 and Portugal’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 atthe end of the reporting period;for bonding, instalment credit protection and reinsurance, the UPR relates to risk taken on;
for 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 when interpretingthe claims development tables in Note 18 to evaluate the accuracy with which Atradius has historically estimatedfuture 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., theperiod 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 amounts that will be paid out as a percentage of the claim amount;the speed with which customers submit claims, as measured from the moment that the insured shipment
took place, the expected average claims payment and the expected percentage of cases that do not lead to apayment;
the expected number of claims for risks taken on during the most recent months since very few claims will
have been reported for the most recent four to six months (depending on the country of the customer);the inflow by number and size of large case; andthe estimation of the expected recovery percentages.

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., the time between issuance of the bond andreceipt of the bond call tends to be much longer than that of traditional short-term credit insurance. For example, mostcredit insurance covers credit periods up to 180 days, while around half the number of bonds written has tenors ofover two years. After receipt of a bond call, it will take longer to settle 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.

4.2.6.2

Assumptions, change in assumptions and sensitivity

The risks associated with credit insurance and bonding are complex and are subject to a number of influences that are
not particularly open to quantitative sensitivity analysis. However, this section describes the quantitative sensitivity
analysis that is feasible.
The most important assumption used in the main method for reserving for traditional credit insurance to set theestimate for the ultimate number of claims for the most recent months of shipment is that the claims inflow in early2018 will be around 20% above the level of end 2017. An indication of the sensitivity to projected ultimate number ofclaims would be the following: if the estimated ultimate number of claims for the most recent six months of risk wereto change by 10%, the claims provisions would change by EUR 23 million, gross of reinsurance (2016: EUR 23 million).
As in essence provisions for most recent months are set as estimated number times estimated claims size, this also
describes the sensitivity to assumed claims size.

86

86Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

By its nature, an estimate of the expected inflow of large cases is not easy to quantify. The order of magnitude of thissensitivity would, in the judgement of management, be 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.
Claims provisions are presented net of recoveries from salvage and subrogation. Realised recoveries can deviate fromexpected recoveries. Expected recoveries amount to EUR 441.2 million (2016: EUR 478.8 million). The largest twocomponents of the expected recoveries are the recoveries for standard credit insurance of EUR 194.2 million (2016:
EUR 210.9 million), and for instalment credit protection of EUR 134.7 million (2016: EUR 128.8 million).

4.3

Financial risk

Atradius is exposed to financial risk mainly through its financial assets, financial liabilities, reinsurance contracts andinsurance contracts. The core components of financial risk are market risk, credit risk and liquidity risk.
These risks arise mainly from interest rate sensitive positions, equity instruments, credit exposures, non-Eurocurrency exposures and cash flow patterns.

4.3.1 Market risk
Market risk is the risk that the fair value of assets and liabilities that are sensitive to movements in market prices,
decrease or increase due to adverse movements in equity prices, interest rates or currency rates. Atradius exposes
itself to these risks by holding assets and liabilities whose fair value are sensitive to movements in those prices. To
measure these risks, Atradius uses several risk metrics. The most important ones being the mismatch between assets
and liabilities whose fair value is denominated in foreign currency, Value-at-Risk, capital models from the credit
assessment institutions and interest rate duration.
Atradius uses a Solvency II available capital approach to define the Strategic Asset Allocation and to assess the impact
of investment decisions to ensure that sufficient Solvency II capital remains.

4.3.1.1

Fair value of financial assets and liabilities

The estimated fair values of Atradius’ financial assets and liabilities, other than the subordinated debt, equal theircarrying value. The fair values of subordinated debts are disclosed in Note 16.
The fair values correspond with the price, at our best estimate, that would be received to sell an asset or paid totransfer 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, we use
valuation techniques which are based on market prices of comparable instruments or parameters from comparable
active markets (market observable data). If no observable market inputs are available, valuation models are used(non-market observable data). These valuation techniques are subjective in nature and involve various assumptions
about the relevant pricing factors. Changes in these assumptions could 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 framework designed to ensure that they are either determined or validated by afunction independent of the risk taker. To this end, Atradius establishes the accounting policies and processes
governing valuation and is responsible for ensuring that these comply with all relevant accounting pronouncements.
Within this governance structure, non-quoted investments or illiquid investments in which Atradius invests arevalued by an external independent valuation company. That company uses its own proprietary valuation systems tovalue the securities supported by economic and market assumptions from financial information providers. The
valuations are provided on a monthly basis and are reviewed and approved by Atradius.
Debt and equity securities available-for-sale
The fair value of debt and equity securities available-for-sale is based on quoted market prices, where available. For
those securities not actively traded, fair values are provided by an external independent valuation company.

87

87

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Loans and short-term investments
For loans and other short-term investments, carrying amounts represent a reasonable estimate of their fair values.
Other financial assets
The carrying amount of other financial assets, including cash and cash equivalents, is not materially different to theirfair value, given their short-term nature.
Subordinated debt
The fair values of subordinated debts are based on binding quotes from independent brokers (see Note 16 for further
details).
Other financial liabilities and deposits received from reinsurers
The carrying amount of other financial liabilities and deposits received from reinsurers is not materially different totheir fair value, given their short-term nature.

88

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

The following tables present the fair values of the financial instruments carried at fair value:

Financial instruments measured at fair value

Quoted prices
in active
markets Level 1

Valuationtechniques
incorporating
information
other thanobservable
market data Level 3

Total

293,976-

293,976

Government bonds

555,976-555,976

Corporate bonds

1,232,631-

1,232,631

Structured debt

-

-

-

2,082,583-

2,082,583

Quoted prices
in active
markets Level 1

Valuationtechniques
incorporating
information
other thanobservable
market data Level 3

Total

290,904-

290,904

Government bonds

558,988-558,988

Corporate bonds

1,218,200-

1,218,200

Structured debt

-

3,953

3,953

2,068,092

3,953

2,072,045

Assets 2017

Available-for-sale:
Equity securities
Debt securities:

Total

Financial instruments measured at fair value

Assets 2016

Available-for-sale:
Equity securities
Debt securities:

Total
There have been no transfers between Level 1 or 3 in 2017 or 2016.
Structured debt

All structured debt contains embedded derivatives which are used for interest related strategies and are considered as
closely related to the debt instrument. One of the main risks on the structured debt is the default risk of the guarantorof the issuer of the instrument.

8989All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Reconciliation of Level 3 fair values
The following table details the changes in the fair value of Level 3 financial investments (valuation techniques
incorporating information other than observable market data):
Financial investments Level 3

Debt securities
2017

2016

Balance at 1 January

3,953

3,908

Total gains or losses:--

In income statement (net income from investments)--

In other comprehensive income

745(3,960)

-

-

3,953

Sales
Balance at 31 December

In 2017, the remainder of the financial investments included in level 3 were sold. Therefore, as at 31 December 2017
there are no financial investments in level 3.

4.3.1.2

Equity price risk

Equity price risk is the risk that the fair value of the assets that are sensitive to movements in equity prices decreases
due to adverse movements in equity prices. Atradius exposes itself to equity price risk by investing in equity
instruments issued by corporations and equity instruments issued by investment funds. These risks are measured andanalysed by using value at risk techniques and capital models from the external credit assessment institutions. The
Value-at-Risk measures the potential maximum loss on Atradius’ equity instruments due to adverse movements inequity prices in the short-term while the capital models measures the potential maximum loss in the long-term, (seeNote 4.3.1.4 for more information). Atradius invests in a portfolio of diversified equity instruments to manage theserisks.
Individual equities instruments
Atradius invests in individual equities via a segregated mandate in which the asset manager has discretion to selectthe equity portfolio in accordance with investment restrictions set in an investment management agreement. This
diversified portfolio consists out of EUR denominated large capitalization equities. Per the end of December 2017, themarket value of this equities portfolio is EUR 95.2 million (2016: EUR 85.8 million).
Investment funds
The investment funds in which Atradius invests are exposed to market risk, counterparty risk, liquidity risk andcurrency risk (i.e., general investment fund risks). The risk of an investment fund is mainly driven by the nature of theassets in which it invests. As investment funds are offered to multiple investors, the investment restrictions of a fundare stated in the fund’s prospectus. Atradius only selects investment funds that have similar investment restrictions
stated in their prospectus as stated in the Atradius Investment Policy.

9090Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Equity instruments issued by investment funds
The portfolio of equity instruments issued by investment funds are shown in the following table:
Weight in %Weight in %2017
Passive equities exchange traded funds
Active money market funds
Total

2016

197,33499.3%

203,980

99.5%

1,448

0.7%

1,122

0.5%

198,782

100.0%

205,102100.0%

Passive equities exchange traded funds
The portfolio of passive equities exchange traded funds mainly consists of exchange traded funds which passively
tracks the Dow Jones EuroStoxx 50 Index.
Active money market funds
The portfolio of active money market funds consists out of one money market fund denominated in Brazilian Real.

4.3.1.3

Interest rate risk

Interest rate risk is the risk that the fair value of assets and liabilities, that are sensitive to movements in interest rates,
decreases or increases due to adverse movements in interest rates. Atradius exposes itself to this risk by investing in
debt instruments and equity instruments issued by investment funds that invest in debt instruments, issuing
subordinated debt and by insurance contracts.
ProfileAt the end of the reporting period the interest rate profile of Atradius’ interest-bearing financial instruments was:Financial assets (1) (3)Financial liabilities
Total(2) (4)

Fixed rate instruments -Variable rate instruments -carrying amountcarrying amount

2017

2016

2017

2016

1,788,607

1,781,141

552,419495,328(323,614)(323,437)(50,875)(46,146)1,464,993

1,457,704

501,544449,1821) Fixed rate financial assets include debt securities;2) Fixed rate financial liabilities include the subordinated debt;
3) Variable rate financial assets include cash and cash equivalents, loans, short-term investments and cash held for investments;
4) Variable rate financial liabilities include borrowings and deposits received from reinsurers.

Duration
Duration demonstrates the dependability of a bond’s market value to a change in the underlying discount rate of thatbond. The duration figure depicts the percentage change of the market value of a bond investment if the underlying
discount rate is parallel shifted by 1%. The higher the duration figure, the more a bond is sensitive to movements in theunderlying discount rate.
Atradius uses the duration to assess its interest rate risk exposure and monitors whether the duration remains
between the minimum and maximum duration limit (between one to five years for government bonds and one tothree years for corporate bonds) as set in the Atradius Investment Policy. As the duration can be described as thepercentage change of a bond’s value when the underlying discount rate is parallel shifted by 1%, the average maturity
is the weighted average of the time until a bond has paid its final interest and principal redemption. The duration for2017 is 2.5 years (2016: 2.9 years) and the average maturity for 2017 is 2.8 years (2016: 3.2 years).

91

91All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

4.3.1.4

Value-at-Risk

Atradius measures equity price and interest rates risk by analysing the Value-at-Risk (VaR) of its financial
instruments. This risk metric measures the potential maximum loss on those financial instruments due to adverse
movements in equity prices and interest rates within a specified time frame and probability (confidence level). The
VaR is based on variance-covariance methodology that uses the historical volatility of the fair values of the financial
instruments and the correlation between them as main inputs. These volatilities and correlations are provided byfinancial information providers or financial institutions.
The risk of using the variance-covariance methodology or any other historical methodology is that it may
underestimate the riskiness of the financial instruments. This is because these methodologies assume that thehistorical volatility of and correlation between the financial instruments will be repeated in the future. Therefore, it is
not intended to represent or to guarantee any future price movements but rather to be used as guidance for
information purposes and comparison of historical developments only.
The VaR provides insight into the maximum expected loss per asset category and on portfolio level. The fair values
and percentages presented are calculated with a given confidence level of 99% for a period of 12 months. This implies
that there is 1% probability of underestimating the potential maximum loss for the coming 12 months.
The following table shows the VaR of Atradius’ equity securities and debt securities on portfolio level.
Value-at-Risk

EUR million% of themarket value

2017

EUR million% of themarket value

2016

Equity securities:
Shares (including equity funds)

77.8

26.6%

165.3

57.0%

Debt securities:
Government bonds (including government bond funds)

7.1

1.3%

6.8

1.2%

Corporate bonds (including corporate bond funds)

17.9

1.4%

23.3

1.9%

1.4

33.4%

174.8

7.7%

Structured debt
Total portfolio

85.9

3.8%

The classification of financial investments in the VaR table stated above are based on the actual financial risks that theindividual securities present in the investment portfolio carry. For instance, within debt securities a separation
between government bonds, and corporate bonds and structured debt is maintained to capture the actual exposure tocorporate bonds that carry additional credit risk above the risks that government bonds bring along. The asset classstructured debt has been fully disposed in 2017. When individual securities are classified to the asset class that fits
their actual risk profile, the volatility of that asset class is calculated using the volatility to the financial markets of theunderlying securities in that asset class. The volatility of each asset class as a whole serves as input for the VaR
calculation of that asset class. In case of an investment fund, the volatility of the fund (driven by the characteristics of
its underlying securities) serves as input for the calculation of the VaR on that specific investment fund and is
subsequently included in the VaR calculation of the asset class. Total portfolio VaR may not be equal to the sum of the
VaR of the individual portfolio components because the correlation between these components may be less than one.
The VaR percentage decreased from 7.7% at the end of 2016 to 3.8% at the end of 2017 and the VaR value decreased
from EUR 174.8 million at the end of 2016 to EUR 85.9 million at the end of 2017.

4.3.1.5

Currency risk

Movements in exchange rates may affect the value of consolidated shareholders’ equity, which is expressed in Euro.
Foreign exchange rate differences taken to other comprehensive income arise on the translation of the net investment
in foreign subsidiaries and associated companies. During 2017, the Euro strengthened against most of the non-Eurofunctional currencies (see Note 2.6.3) resulting in a foreign currency loss in other comprehensive income of EUR 23.1
million, net of tax (2016: a loss of EUR 0.8 million, net of tax).
However, the impact of these fluctuations is limited as revenue, expenses, assets and liabilities within our non-Euro
operations are generally denominated in the same currencies.
92

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Atradius’ exposure to foreign currency exchange rate risk, arising from monetary financial assets and liabilities
denominated in non-functional currencies as at 31 December 2017 and 31 December 2016, is presented in the following
table:
FinancialassetsFinancialliabilities

Net position

Financialassets2017

Financialliabilities

Net position

2016

EUR

202,045

145,944

56,101

213,870

168,527

45,344

GBP

31,872

23,883

7,989

25,14622,2572,889

USD

291,314

271,401

19,913202,303

311,150(108,847)

AUD

7,520

7,913

(393)

14,321

11,637

2,684

Other

153,813239,240(85,427)

180,327

254,186(73,859)

Total

686,564

688,381(1,817)

635,968

767,757(131,789)

Sensitivity analysis
As an indication of the currency exposure, a 10% strengthening of these foreign currencies against the Euro as at theend of the reporting period would have increased/(decreased) the result for the year by an amount equal to the net
position as presented above, calculated against that 10%. This analysis assumes that all other variables, and inparticular interest rates, remain constant and is performed on the same basis as for 2016. A 10% weakening of theaforementioned foreign currencies against the Euro as at the end of the reporting period would have had an equal but
opposite effect.
The following table specifies Atradius’ gross and net positions in major currencies (both monetary and non-monetary
items):
AssetsLiabilities

Net position

Assets

2017
EUR

3,382,508

Liabilities

Net position

2016

1,902,228

1,480,280

3,369,926

1,912,515

1,457,411

GBP

135,653

96,47339,180120,950

108,884

12,066USD

394,331

299,070

95,261

336,608

323,814

12,794

AUD

77,03440,82336,211

78,34938,93839,411

Other

529,636

427,320

102,316

511,840

407,997

103,843

Total

4,519,162

2,765,914

1,753,248

4,417,673

2,792,148

1,625,525

4.3.2 Credit risk
Credit risk is the risk that customers or counterparties are unable to repay their debt towards Atradius in full whendue. Atradius exposes itself to credit risk mainly by reinsurance contracts and holding financial assets.
Reinsurance is used to manage insurance risk. This does not, however, discharge the liability as primary insurer. If a
reinsurer fails to pay a claim for any reason, Atradius remains liable for the payment to the policyholder. The Atradiuspolicy is to select only reinsurers that have a well-established investment grade credit rating. The normal minimum
requirement is an ‘A’ level rating, although there are some minor exceptions. In the event that the reinsurer’s rating isfound to be below this threshold, Atradius has the right to either terminate the reinsurance relationship during thecourse of the reinsurance year or else seek collateral if the relationship is to continue. Deposits received fromreinsurers mitigate the credit risk and are therefore included in the table below.
Individual operating units maintain records of the payment history for significant contract holders with whom they
conduct regular business. The exposure to individual counterparties is also managed by other mechanisms, such as
the right of offset where counterparties are both debtors and creditors. Management information reported to Atradius
includes details of provisions for impairment on loans and receivables and subsequent write-offs.

9393All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Credit exposure to business partners, such as insured customers and brokers, is closely monitored. Potential
impairments on receivables are reviewed monthly and updated.
With regard to managing the credit risks of the financial investments, the investment policy of Atradius is to hold a,
principally Euro-centric, internationally diversified portfolio and to avoid large risk concentrations. From a Standard& Poor’s rating scale or comparable perspective, the overall fixed income portfolio is almost completely invested ininvestment grade debt securities which are rated ‘A-‘ or higher. If a debt security in which Atradius has invested falls
below the minimum credit rating or is not rated, it should be reviewed by the Group Investment Committee to decide
whether the debt security is still a suitable investment. The maximum concentration limit per issuer (per legal entityand at Atradius level) is 5% of the market value of the financial investments of the legal entity or Atradius. The
concentration per issuer is evaluated by aggregating the exposure to a single issuer through both debt investments
and equity securities. The Group Investment Committee monitors this limit and action is taken if a concentration limit
is breached.
The counterparty ratings of receivables, short-term investments, claims, commissions and deposits arising fromreinsurance, cash and cash equivalents and the rating of debt securities as at 31 December 2017 and as at 31 December
2016, are presented in the following tables:
At 31 December 2017

AAA

AA

A

BBB

Other andNon-rated

Total

Receivables, claims and commissions arisingfrom reinsurance

-

209

231

1

24

465

Deposits received from reinsurers

-

(22)

(21)

-

(2)

(45)

Government bonds

187

280

61

8

20

556

Corporate bonds

9

96

1,011

116

1

1,233

Structured debt

-

-

-

-

-

-

(EUR million)
Receivables, claims, commissions and deposits
arising from reinsurance:

Debt securities:-

Short-term investments:-

Deposits withheld by ceding companies

-

7

6

4

10

27

Bank deposits under short-term investments

20

19

106

33

-

178

Cash and cash equivalents

67

31

135

110

4

347

Total

283

620

1,529

272

57

2,761

At 31 December 2016

AAA

AA

A

BBB

Other andNon-rated

Total

Receivables, claims and commissions arisingfrom reinsurance

-

235

225

1

25

486

Deposits received from reinsurers

-

(21)

(22)

-

(3)

(46)

185

292

56

12

15

560

(EUR million)
Receivables, claims, commissions and deposits
arising from reinsurance:

Government bonds
Corporate bonds

7

148

969

91

3

1,218

Structured debt

-

-

1

3

-

4

Deposits withheld by ceding companies

-

8

13

1

7

29

Bank deposits under short-term investments

33

26

65

55

-

179

-

40

142

93

12

287

225

728

1,449

256

59

2,717

Cash and cash equivalents
Total

94

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

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, Atradius uses Moody’s or Bloomberg Composite
Ratings.

4.3.3 Liquidity risk
Atradius is exposed to liquidity risk if there is insufficient cash available to meet its financial obligations, when due, ata reasonable cost. For Atradius, liquidity risks may arise if large scale short-term fluctuations occur to cash flows, suchas a decline in incoming cash or a rise in outgoing cash, or a combination of both.
Liquidity risk is managed at Atradius level, in close coordination with local operations. 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 Atradius should only
invest in financial instruments that can be liquidated in less than three business days. Atradius is able to access credit
facilities to prevent certain liquidity shortages which may arise due to short-term cash flow variances. Atradius
maintain one uncommitted credit line in excess of EUR 1 million, in the form of an overdraft facility for a total amountof EUR 50 million (2016: EUR 53 million). The credit line provides liquidity to cover infrequent peaks in short-term
liquidity requirements while also permitting Atradius to reduce its cash balances and to benefit from a more
substantial and stable investment portfolio. Finally, Atradius has in place a simultaneous claims payment clause in themain reinsurance treaties. This clause allows Atradius to ask the reinsurers to anticipate the payment of a large claim
upon Atradius’ request instead of the usual payment terms agreed in the reinsurance treaties.
Liquidity and interest risk tables
The following tables indicate the estimated amount and timing of the main cash flows at the end of the reporting
period of interest and non-interest bearing liabilities and assets. The tables include both interest and principal cash
flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves
at the end of the reporting period. Atradius has considered the impact of the cross-border cash pooling arrangement inthis overview.
The tables have been drawn up based on the undiscounted contractual cash flows of financial liabilities based on theearliest contractual repayment date. When Atradius has a choice of when an amount is paid, the financial liability isallocated to the latest period in which Atradius can be required to pay. When the lender has a choice of when an
amount is paid, the financial liability is allocated to the earliest period in which Atradius can be required to pay.

95

95

All
thousands ofof Euro,Euro, unlessunless otherwise
otherwise statedstatedAll amounts
amounts inin thousands

At 31 December 2017

Contractual cash flows (undiscounted)
Weighted
averageeffective
interest
rate %

On demand

Less than 1
year

1 to 5 years> 5 years

Carrying
amount13,12552,500507,822248,6143,750

15,00087,38075,000Interest bearing liabilities
Subordinated note

5.35%

Subordinated loan

5.00%

Bankoverdraft

0.00%

5,993

Deposits received fromreinsurers

0.16%

-

44,882--44,882

5,993

61,75767,500595,202374,489

1,038,894

469,319(1,031)

1,530,339

Total

5,993

Non-interest bearing liabilities
Insurance contracts
Payables-

200,947--

200,947

Total-

1,239,841

469,319(1,031)

1,731,286

At 31 December 2016

Contractual cash flows (undiscounted)
Weighted
averageeffective
interest
rate %

On demand

Less than 1
year

1 to 5 years> 5 years

Carrying
amountInterest bearing liabilities
Subordinated note

5.35%

13,12552,500521,439

248,437

Subordinated loan

5.00%

3,750

15,00092,74075,000Bankoverdraft

0.10%

611

Deposits received fromreinsurers

0.27%

-

45,535--45,535611

62,41067,500614,179

369,583-

1,061,761

475,129

1,378

1,561,155

Total

611

Non-interest bearing liabilities
Insurance contracts
Payables-

232,746--

232,746

Total-

1,294,507

475,129

1,378

1,793,901

96

96

Atradius
Atradius || Consolidated
Consolidatedfinancial
financialstatements
statements2017
2017Atradius
AtradiusN.V.
N.V.

At 31 December 2017

Contractual cash flows (undiscounted)
Weighted
averageeffective
interest
rate %

On demand

Less than 1
year

1 to 5 years> 5 years

Carrying
amountDebt securities
Investments: deposits and cash
held for investments

0.22%

-

196,223

1,545,996

51,401

1,788,607

0.00%

65,786

99,40240,000Cash: Cash and bank deposits

0.00%

340,195

6,976

-

-

347,171405,981

302,601

1,585,996

51,401

2,341,000-

294,002--

293,926

403,849

182,439(401)

585,887

Interest bearing assets

Total

205,222

Non-interest bearing assets
Other financial assets
Reinsurance contracts
Receivables-

225,079--

225,079

Total-

922,930

182,439(401)

1,104,892

At 31 December 2016

Contractual cash flows (undiscounted)
Weighted
averageeffective
interest
rate %

On demand

Less than 1
year

1 to 5 years> 5 years

Carrying
amount(0.03%)-

254,658

1,482,492

61,387

1,781,141

0.00%-1.33%

80,025

127,893127

417

208,223

0.00%

285,729129--

286,469

365,754382,680

1,482,619

61,8042,275,833

Other financial assets-

290,929--

290,929

Reinsurance contracts-

436,407

195,288567

632,262

Receivables-

201,287--

201,287

Total-

928,623

195,288567

1,124,478

Interest bearing assets
Debt securities
Investments: deposits and cash
held for investments
Cash: Cash and bank deposits
Total
Non-interest bearing assets

4.4

Operational risk

4.4.1 Operational risk management
Operational risks are the risks arising from inadequate or failed internal processes, people, and systems, or applicable
loss from external events. This definition is in line with industry practice as well as with the European Solvency II
Directive. It is therefore present within all activities undertaken by Atradius, at all levels and across all locations.
The Operational Risk Management (ORM) unit is part of the Atradius Risk Management department and is responsiblefor developing methods for the identification, assessment and response to risks, and for monitoring and further
enhancing the overall risk management and control framework. The ORM unit works closely with both Internal Audit
and the Legal and Compliance unit. At the highest level, operational risk is overseen by the Operational Risk
Committee, which has a reporting line through to the Chief Risk Officer.

97

97All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

The ORM unit uses a framework for management of operational risk, which is based on the Committee of Sponsoring
Organisations’ Enterprise Risk Management (COSO ERM) Integrated Framework. Identification and monitoring
activities continue to be developed and enhanced, including the maintenance of risk registers, risks and control selfassessment procedures and business continuity plans. Additionally, risks and the related controls are discussed at alllevels, locations and units across the business, including the Management Board and Supervisory Board. High-level
information on crystallised risks has been captured for several years, with separate records of information technology
risk events stretching back even further. To provide oversight and assurance in an auditable and efficient manner, theORM unit employs a dedicated governance, risk and compliance software platform (the ’GRC portal‘) that integrates
existing risk management activities across the business.
In respect of external fraud, the Fraud Control Group, composed of employees across various locations, monitors theactivity of customers and buyers to detect indications of fraud. Atradius also provides fraud awareness training toemployees to help identify fraudulent buyers. Internal fraud is addressed through manual and automated operational
controls such as the segregation of duties, application of signing authorities and role-based system privileges andauthorities.
More details on certain operational risk management activities are provided below.

4.4.1.1

Risk registers and risk / control self-assessments

While the ORM unit is responsible for facilitating operational risk management within Atradius, the lines of businessand functional 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 the registers provides
input to local management meetings and is also reviewed by an Operational Risk Committee and during meetings ofthe Management Board. This ensures that operational risks are evaluated 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 identify and assess risks and any control weaknesses inherent in business processes.
On a quarterly basis, Atradius conducts specific assessments of processes and controls covering financial reporting
risks; the resulting ‘in control’ sign-off process is overseen by a committee with representatives from Group Risk
Management, Finance and Internal Audit.

4.4.1.2

Business continuity management

Atradius recognises the importance of being able to recover its critical business processes in the event of any major
operational disruption. The business continuity management programme at Atradius is aligned with the International
Standard ISO22301. The ORM unit co-ordinates the documentation, maintenance and continual testing of practicalplans for recovering key business activities within acceptable timeframes.

4.4.1.3

Compliance

Compliance practices support our business, our reputation and our integrity. These elements are of importance to ourcustomers, suppliers, staff and other stakeholders. Complying with relevant laws, rules and regulations andmaintaining a high standard in terms of ethics and integrity, leads to lower operational risk and more stable businessprocesses. The Atradius Code of Conduct outlines the basic corporate, legal and ethical compliance principles andguidelines that apply to all employees of Atradius and that govern Atradius’ operations and its employees’ businessconduct and actions. Individual Compliance Codes address specific compliance areas in more detail and set out
detailed compliance requirements that must be complied with across Atradius and which must be included in existing
business procedures. For the monitoring and testing of effectiveness of these requirements, close alignment is soughtwith the activities of the ORM and Internal Audit units.

9898

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

4.5

Capital management

4.5.1 Guiding principles
Capital management is guided by the following principles:-to ensure that Atradius is sufficiently capitalised to have the ability to survive by maintaining sufficientavailable capital after meeting its financial obligations;
to meet the local regulatory capital requirements of all Atradius entities, including branches andsubsidiaries of Atradius worldwide;
to manage the capital adequacy of Atradius and its entities, taking into account the economic andaccounting views along with the external rating agencies and regulatory capital requirements;
to optimise capital structure by allocating funds across Atradius’ entities; andminimising the overall cost of funding while preserving financial flexibility.

4.5.2 Atradius' objectives, policies and processes with regard to capital
Available capital is measured and managed both from an accounting and economic perspective. Atradius considers
the solvency calculation models of the relevant regulatory authorities and credit rating agencies to actively manage
capital to ensure capital adequacy. Atradius’ policy is to maintain a sufficient excess above the minimum solvency
capital required by the relevant regulatory authorities.
Atradius has embedded processes and procedures to ensure compliance with externally imposed regulations andinternally imposed requirements for capital adequacy. Such compliance is ensured by:-a process of regular assessment of solvency needs, taking into account the business strategy, resulting
risk profile and applied risk limits;
incorporating a view on expected future investments in new businesses, revenues, claims, reinsurance
expectations and dividends as these impact both available and required capital;
monitoring duration of assets; andtaking into consideration capital market expectations such as expected returns, volatilities andcorrelations as these may impact earnings and the shareholder equity reserves.

In order to ensure capital adequacy, a capital buffer above the regulatory solvency capital required is maintained, suchthat large loss events would not impair the ability of Atradius to carry on its normal course of business.

4.5.3 Regulatory capital requirements
In each country in which Atradius operates with insurance or reinsurance companies established according to local laws,
and where prescribed for branches as well, the local insurance regulator specifies the minimum amount and type of capitalthat must be held by each of the subsidiaries or branches. The minimum required capital must be maintained at all times
throughout the year. In addition, the local insurance regulators have the discretionary right to impose additional capitalrequirements in excess of the required minimum.
In 2017, the capital of Atradius has been managed according to the Atradius guidelines and in close cooperation with theunits involved in managing the different factors related to capital. The Atradius entities were able to meet their financial
obligations and to comply with local legal and regulatory requirements.

4.5.4 Solvency II
Solvency II is the regulatory framework for (re-)insurance undertakings and groups domiciled in the EU; it became effective
on 1 January 2016. It replaced the former regulatory regime of 14 directives which were commonly known as ‘Solvency I’.
Atradius Crédito y Caución, S.A. de Seguros y Reaseguros in Spain and Atradius Re in Ireland are the regulated
entities that are subject to Solvency II. Under Solvency II guidelines Group supervision takes place at the ultimate parent
Grupo Catalana Occidente S.A.

99

99

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

After approval by the College of Supervisors during 2017, the regulated entities within Atradius apply a Partial Internal
Model for calculating their regulatory capital requirements. An internal model, which reflects our business better than theregulatory ‘standard formula’, is used to calculate capital requirements for Underwriting Risk. We still use the standard
formula for Market, Counterparty Default and Operational Risk as the characteristics of these risk types do not warrant aninternal model approach.

100

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

5

Segment information

Operating segments are identified on the basis of internal reports about components of Atradius that are regularly
reviewed by the Management Board in order to allocate resources to the segment and to assess its performance. The
insurance business is split into the segments Credit insurance which includes Instalment credit protection (ICP),
Bonding and Reinsurance due to the different nature of the related products and the associated insurance liabilities.
The segment Services includes Collection activities, Atradius Dutch State Business and other service related business.
Group costs relate to corporate operations, after cost allocations to the other business segments.
Collection activities include recovery activities on behalf of insurance companies. Transactions between segments areon an arm’s length basis in a manner similar to transactions with third parties. The accounting policies of thereportable segments are the same as described in Note 2.
Information regarding these segments is presented in the following tables:

101

101

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Business segment

Creditinsurance

Bonding

Reinsurance

Total
insurancebusiness

Services

Group
costs

Total

2017
Insurance premium
revenue

Intersegment
eliminati
on1,341,173

113,225

133,697

1,588,095---

1,588,095

Service and other income

130,830--

130,830

118,310--249,140

-

-

-

-

3,402

(3,402)--

Total revenue

1,472,003

113,225

133,697

1,718,925

121,712(3,402)-

1,837,235

Insurance premium ceded
to reinsurers(599,825)(50,394)(25,410)(675,629)---(675,629)

Total segment income
after reinsurance

872,178

62,831

108,287

1,043,296

121,712(3,402)-

1,161,606(618,736)(21,040)(77,452)(717,228)

-

2,746

-

(714,482)

257,764

7,468

20,266285,498---

285,498

-

2,746

-

(428,984)

656(6,745)(730,376)Inter-segment revenue

Insurance claims and loss
adjustment expenses
Insurance claims and loss
adjustment expenses
recovered from reinsurers
Net insurance claims(360,972)(13,572)(57,186)(431,730)

Gross operating expenses
Commission received forbusiness ceded toreinsurers(509,929)(41,396)(54,840)(606,165)

233,162

18,733

4,552

256,447---

256,447

Net operating expenses(276,767)(22,663)(50,288)(349,718)(118,122)656(6,745)(473,929)

Operating segment result

234,439

26,596813

261,848

3,590-(6,745)

258,693(118,122) *Share of income/ (losses)of associated companies
Net income frominvestments

20,586

Finance income

2,696

Finance expenses(19,271)

Result for the year before
tax

255,309

Income tax expense(69,073)

Result for the year

186,236(7,396)*Gross Operating Expenses Service Segment: includes EUR 1.5 million from Trade name amortisation (not considered for management repoting purposes).

Business segment

Creditinsurance

Bonding

Reinsurance

Total
insurancebusiness

Services

Intersegment
elimination

Total

Reinsurance contracts

390,885

148,045

46,957585,887--

585,887

Receivables

198,207

20,377

3,559

222,143

5,675(2,739)225,079

-

-

-

-

-

-

3,708,196

Total assets

589,092

168,422

50,516808,030

5,675(2,739)4,519,162

Insurance contracts

879,679

278,074

372,586

1,530,339--

1,530,339

Payables161,940

37,960564

200,464

15,051(14,568)

200,947

-

-

-

-

-

-

1,034,628

1,041,619

316,034

373,150

1,730,803

15,051(14,568)

2,765,914

2,723

139

21

2,883

713

-

3,596

2017

Unallocated assets

Unallocated liabilities
Total liabilities
Total year end number of employees(full-time equivalent)

102

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Business segment

Creditinsurance

Bonding

Reinsurance

Total
insurancebusiness

Services

Intersegment
elimination

Group
costs

Total

Insurance premium revenue

1,316,365

109,199

132,024

1,557,588---

1,557,588

Service and other income

127,396--

127,396

75,683--203,079

2016

Inter-segment revenue

-

-

-

-

3,419

(3,419)--Total revenue

1,443,761

109,199

132,024

1,684,984

79,102(3,419)-1,760,667

Insurance premium ceded toreinsurers(593,495)(48,635)(21,701)(663,831)---(663,831)

Total segment income after
reinsurance

850,266

60,564

110,323

1,021,153

79,102(3,419)-1,096,836

Insurance claims and loss
adjustment expenses(600,704)(7,901)(92,542)(701,147)

-

2,755

-

(698,392)

Insurance claims and loss
adjustment expenses
recovered from reinsurers

252,416948

18,532271,896---

271,896

Net insurance claims(348,288)(6,953)(74,010)(429,251)

-

2,755

-

(426,496)

Gross operating expenses(510,594)(40,884)(54,927)(606,405)(70,471)664(6,986)(683,198)

Commission received forbusiness ceded to reinsurers

227,737

18,102

6,034

251,873---

251,873

Net operating expenses(282,857)(22,782)(48,893)(354,532)(70,471)664(6,986)(431,325)

Operating segment result

219,12130,829(12,580)

237,370

8,631-(6,986)

239,015

Share of income/ (losses) of
associated companies

26,689Net income from investments

18,279Finance income

3,325

Finance expenses(12,744)

Result for the year before tax

274,564

Income tax expense(62,792)

Result for the year

211,772

Business segment

Creditinsurance

Bonding

Reinsurance

Total
insurancebusiness

Services

Intersegment
elimination

Total

Reinsurance contracts

426,959

158,51446,789632,262--

632,262

Receivables

198,263

20,084

5,902

224,249

7,267(4,058)227,458

2016

Unallocated assets

-

-

-

-

-

-

3,557,953

Total assets

625,222

178,598

52,691

856,511

7,267(4,058)4,417,673

Insurance contracts

882,289

281,977

396,889

1,561,155--

1,561,155

Payables172,219

84,946887

258,052

12,530

Unallocated liabilities
Total liabilities
Total year end number of
employees (full-time equivalent)(11,665)

258,917

-

-

-

-

-

-

972,076

1,054,508

366,923

397,776

1,819,207

12,530(11,665)

2,792,148

2,640

139

27

2,806

780

-

3,586

103

103

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

The segmental reporting follows the management point of view. In all the other insurance related notes the figures arereported based on the products of credit insurance and bonding which differs from the segmental view presented
here. The underlying contracts of the Reinsurance segment are approximately 58% credit insurance contracts andapproximately 42% bonding (2016: 58% and 42% respectively), based on premium volume.
Revenue from external customers allocated to the region in which the insurance contract is issued or services are
rendered is presented in the following table:
2017

2016

Spain and Portugal

372,348394,254

France, Belgium, Italy and Luxembourg

340,480

326,056

Germany, Central and Eastern Europe

328,485299,969

United Kingdom and Ireland

277,770

266,502

The Netherlands

168,758

147,527

Oceania and Asia

130,259

122,699

Americas121,604

111,576

Nordic countries

97,531

92,084

1,837,235

1,760,667

Total

Total assets and capital expenditure allocated based on where the assets are located are presented in the following
table:
Non-current assets 1)

AssetsAdditions to non-current
assets 1)

2017

2016

2017

2016

2017

2016

1,420,458

867,790

123,738

118,363

12,712

8,276

France, Belgium, Italy and Luxembourg

321,651354,682

25,02522,831

5,076

4,833

Germany, Central and Eastern Europe

342,190

277,862

7,215

5,681

3,004

2,791

United Kingdom and Ireland

1,462,223

1,431,163

34,017

27,792

17,078

14,106The Netherlands

433,406

928,258

33,44930,951

11,90014,522

Nordic countries

147,083

140,349

1,180

1,326

315

405

Americas208,994

230,086

2,859

2,501

1,049

533

Oceania and Asia

183,157

187,483

1,512

1,860

360

569

4,519,162

4,417,673

228,995

211,305

51,49446,035

Spain and Portugal

Total
1)

Non-current assets included in the above table comprise intangible assets (other than goodwill), property, plant and equipment and investment property.

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Atradius | Consolidated financial statements 2017 Atradius N.V.

6

Intangible assets

2017

Goodwill

Software

Other 1)Total

At cost at 1 January

151,312

193,424

32,238376,974

Additions-

31,316-31,316

Disposals-(3,286)(1,739)(5,025)

Reclassification(9)

Effect of movements in foreign exchange rates

(9)

(20)

(2,614)(157)(2,791)

151,292

218,831

30,342400,465(736)(130,802)(19,431)(150,969)

Amortisation charge for the year-

(16,074)(2,584)(18,658)

Disposals

-

1,881

1,532

3,413

Impairment

-

-

-

-

At cost at 31 December

Accumulated amortisation and impairments at 1 January

Reclassification

163

Effect of movements in foreign exchange rates
Accumulated amortisation and impairments at 31 December

163

(736)

1,848
(142,984)

157(20,326)

2,005(164,046)

Balance at 1 January

150,576

62,622

12,805226,005

Balance at 31 December

150,556

75,847

10,014

236,4192016

Goodwill

Software

Other 1)Total

At cost at 1 January

118,378

169,708

24,661

312,747

Business combinations

32,943

7,944

5,800

46,687

Additions-28,242

1,739

29,981

Disposals-(2,097)-(2,097)

Effect of movements in foreign exchange rates(9)(10,373)38(10,344)

151,312

193,424

32,238376,974(735)(121,789)(16,723)(139,247)

Amortisation charge for the year-

(12,740)(2,672)(15,412)

Disposals

-

2,083

-

2,083

- -

(5,683)-(5,683)7,327(130,802)(36)(19,431)7,290(150,969)

At cost at 31 December

Accumulated amortisation and impairments at 1 January

Impairment
Effect of movements in foreign exchange rates
Accumulated amortisation and impairments at 31 December

(1)
(736)

Balance at 1 January

117,643

47,919 -7,938

173,500

Balance at 31 December

150,576

62,622

12,805226,005

1)

Other intangible assets relate to agent networks, non-patented technology, trade names and insurance portfolios

Goodwill
If applicable, impairment of goodwill is recognised as a separate item in the income statement. During 2017 there was
no impairment charge (2016: no impairment charge).
The goodwill allocated to the main cash-generating units or groups of units (CGU’s) is presented in the following table:

105

105

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedCash-Generating Units

2017

2016

ACyC 1)

98,797

98,797

Graydon Holding N.V.

30,93130,931

Atradius Trade Credit Insurance Inc.

4,750

4,750

Atradius Collections B.V.

6,426

6,426

ACyC. (France)

2,767

2,767

ACyC (Nordic bonding) 2)

2,571

2,592

Other

4,314

4,313

Total

150,556

150,5761) The CGU ACyC includes the local business in Spain and Portugal,.
2) The Nordic Bonding unit includes Atradius’ bonding business in Denmark, Norway, Sweden and Finland.

The value in use of an individual CGU is determined using a dividend discount cash flow model (DDM). The dividend
cash flows are estimated using a projection period and a normalised period. The projection period is 10 years, where
the first 1-3 year projections are based on financial budgets and/or forecasts. The remaining years are estimated using
ratios and growth rates that converge towards their normalised term value. The discount rate used varies dependingon the Risk-Free Rate and the Country Risk Premium of the country where the CGU is located. For the main portion of
the goodwill the discount rate used is: 8.69% (2016: 8.62% as fixed discount rate). The terminal value is calculated
based on the free cash flows of the normalised period through a perpetuity which applies a long-term growth rate of
0.5% (2016: 0.5%) and the specific discount rate. Any profits, after fulfilling minimum capital requirements, areassumed to be distributable dividends. Minimum capital requirements are calculated based on the Solvency II Partial
Internal Model and minimum shareholders equity required (non-distributable).
SoftwareAtradius assessed all capitalised software to determine if the criteria for capitalisation are being met. During 2017
Atradius has capitalised EUR 25.2 million mainly due to Atradius Business Transformation project (ABT) (2016: EUR
18.3 million).
Atradius performed an impairment test on an annually basis. In 2017, there is no impairment recognition (2016: EUR
5.7 million).

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Atradius | Consolidated financial statements 2017 Atradius N.V.

7

Property, plant and equipment & investment property

2017

Land &
buildings

Fixtures &fittings

IT hardware

Total
property,plant &
equipment

Investment
property

At cost at 1 January

108,388

57,22949,177214,794

14,518Additions

-

7,902

7,204

15,106

3,971

Disposals-(3,325)(3,886)(7,211)

-

3,860

4

(12)

3,852

(3,860)

(136)

(880)

(1,002)(2,018)(48)

At cost at 31 December

112,11260,93051,481

224,523

14,581

Accumulated depreciation and impairments
at 1 January(10,427)(40,026)(38,373)(88,826)(4,610)Depreciation charge for the year

(1,022)(4,031)(5,393)(10,446)(134)

Disposals

-

3,279

3,852

7,131

-

Impairment loss

-

-

-

-

(269)

Reclassification

(114)

(118)

(38)

(270)

115

Reclassification
Effect of movements in foreign exchange
rates

Effect of movements in foreign exchange
rates
Accumulated depreciation and impairments
at 31 December

23

588

722

1,333

5

(11,540)(40,308)(39,230)(91,078)(4,893)

Balance at 1 January

97,961

17,203

10,804125,968

9,908

Balance at 31 December

100,572

20,622

12,251

133,445

9,688

2016

Land &
buildings

Fixtures &fittings

IT hardware

Total
property,plant &
equipment

Investment
property

At cost at 1 January

108,582

51,891

48,087

208,560

14,615Business combinations

-

207

402

609

Additions

14

9,204

5,481

14,699-

Disposals
Effect of movements in foreign exchange
rates

-

(2,411)(1,735)(4,146)-(208)(1,662)(3,058)(4,928)(97)

108,388

57,22949,177214,794

14,518

Accumulated depreciation and impairments
at 1 January(9,422)(40,109)(37,776)(87,307)(4,517)

Depreciation charge for the year

(1,033)(3,628)(4,572)(9,233)(113)

Disposals

-

2,197

1,702

3,899

-

Impairment loss

-

-

-

-

11

Reclassification

-

121

39

160

-

At cost at 31 December

Effect of movements in foreign exchange
rates
Accumulated depreciation and impairments
at 31 December

28

1,393

2,234

3,655

9

(10,427)(40,026)(38,373)(88,826)(4,610)

Balance at 1 January

99,16011,782

10,311

121,253

10,098

Balance at 31 December

97,961

17,203

10,804125,968

9,908

107

107

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

The depreciation charge on property for own use is reported as part of net operating expenses. The depreciation
charge on investment property is reported as part of net income from investments.
The fair value of land and buildings for own use and of investment property is presented in the following table:
Property own use

Investment property

2017

2016

2017

2016

Spain and Portugal

86,39583,205

8,830

8,267

Italy

20,62020,620675

745

Mexico

3,567

3,848

1,189

1,283

-

-

460

460

Other

904

971

-

-

Total

111,486

108,644

11,154

10,755The Netherlands

Fair value measurement
Land and buildings are independently appraised by real estate valuators, which are registered in the relevant
countries and have appropriate qualifications and experience in the valuation of properties. Atradius usually revalues
land and buildings every two years.
All property is valued using valuation techniques. All significant inputs used in the measurement are market
observable and the fair value is therefore classified in Level 2 in the fair value hierarchy (as in 2016). Valuation
techniques used are: Market (comparison) approach, Income approach (discounted cash flow method) and Cost
approach. The valuations for Spanish property are in accordance with the rules applicable to insurance companies inconnection with the valuation of assets to cover technical provisions. Significant valuation inputs used to determine
the fair value measurements based on techniques used are construction features, location (and/or conditions) andtransport utilities.
The estimated fair value of the properties is directly dependant on the changes of the inputs used. There has been nochange in the valuation techniques used compared to prior year.
The investment property can be classified as follows: 89% office (2016: 88%) and 11% retail (2016: 12%).
Direct operating expenses incurred (including repairs and maintenance) arising from investment property are EUR 97
thousand (2016: EUR 72 thousand). During the year an amount of EUR 551 thousand (2016: EUR 572 thousand) has
been recognised as rental income from investment property for lease contracts. These contracts have remaining termsof between 1 and 10 years. Expected rental income arising from these contracts for next year is EUR 487 thousand ofwhich EUR 487 thousand are for non-cancellable contracts.

108

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

8

Subsidiaries

The following table sets forth, as at 31 December 2017 and 2016, the name and country of incorporation of the main
subsidiaries of Atradius N.V.
All companies are, directly or indirectly, wholly owned unless otherwise indicated. The companies are listed inalphabetical order.
Country ofincorporation% interest
heldType of business

The Netherlands

100.00%

Collections

Spain

100.00%Credit insurance

Atradius Finance B.V.

The Netherlands

100.00%Finance

Atradius Information Services B.V.

The Netherlands

100.00%Information services

Atradius Insurance Holding N.V.

The Netherlands

100.00%Holding

Atradius Participations Holding B.V.

Atradius Collections B.V.
Atradius Crédito y Caución S.A. de Seguros y Reaseguros

The Netherlands

100.00%Holding

Atradius Reinsurance DAC

Ireland100.00%

Reinsurance

Atradius Rus Credit Insurance LLC

Russia100.00%Credit insurance

Atradius Seguros de Crédito, S.A.

Mexico100.00%Credit insurance

Atradius Trade Credit Insurance, Inc.

USA

100.00%Credit insurance

Atradius Crédito y Caución Seguradora SA

Brazil100.00%Credit insurance

The Netherlands

100.00%Information services

Graydon Holding N.V.

109

109

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

9

Investments in associated companies

The following table shows the changes in investments valued by using the equity method:
2017

2016

Balance at 1 January

39,58635,396

Additions

34,742-

Share of income of associated companies
Disposals
Impairments of associated companies
Revaluations
Effect of movements in foreign exchange rates

3,678(11,701)54(2,821)

6,808(3,449)831

Balance at 31 December

63,53839,586On 12 April 2017 Atradius obtained significant influence over Credit Guarantee Insurance Corporation of Africa
Limited (‘Credit Guarantee’) by acquiring an investment of 25% at the cost of EUR 34.7 million. The goodwill generated
at the acquisition date was EUR 19.9 million.
During 2017 the value of the investment in Credit Guarantee was revalued and as a result an impairment loss of EUR
13 million were recognised of which EUR 1.3 million relates to effect of movement in foreign exchange rates.
None of the associated companies is listed. All information from the associated companies, unless otherwise stated, isbased on balance sheet dates between 30 September 2017 and 31 December 2017.

Credit Guarantee Insurance Corporation of Africa Limited
CLAL Credit Insurance Ltd., Tel Aviv
Compañía de Seguros de Crédito Continental S.A., Santiago de
Chile
The Lebanese Credit Insurer s.a.l., Beirut
1) Minus one share

110

110

Country ofincorporation% interest
heldType of business

South Africa

25.00%

Credit insurance

Israel20.00%

Credit insurance

50.00% 1)
48.90%

Credit insurance
Credit insurance

Chile
LebanonAtradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

The following tables show summarised financial information of Atradius’ interest in associated companies and thefinancial information of the associated companies:
2017

CreditGuarantee
Insurance
Corporationof Africa
Limited

CLAL
CreditInsurance
Ltd.

Compañía
de Seguros
de Crédito
Continental
S.A.

The
Lebanese
CreditInsurers.a.l.

Other

Total

Goodwill

6,927

380

1,611

-

-

8,918

Net assets

15,31810,361

27,4801,461-

54,620Carrying amount

22,245

10,741

29,091

1,461-

63,538

964

958

1,919

(163)

-

3,678

Result sale

-

-

-

-

-

-

Other income/(expense)

-

-

-

-

-

-

Dividends received

-

-

-

-

627

627

Assets127,879

81,144

120,160

10,674-

339,857

Liabilities

66,60829,33465,1997,686-

168,827

Revenue

46,842

13,574

10,745

2,662-

73,823

Net assets

61,271

51,81054,961

2,988-

171,030

Result for the year

3,856

4,795

3,838

(334)

-

12,155

Goodwill

-

380

1,611

-

-

1,991

Net assets

-

9,573

26,176

1,846-

37,595Carrying amount

-

9,953

27,787

1,846-

39,586

Share of income of associated companies

-

81

7,141

80

-

7,302

Other income

-

-

-

-

(494)

(494)

Dividends received

-

-

-

-

-

-

Assets

-77,886

106,502

14,723-

199,111

Liabilities-

30,02054,15010,951-

95,121

Revenue-

13,160

9,605

3,676

-

26,441

Net assets-

47,86752,352

3,772-

103,991

Result for the year-405

14,282

163-

14,850

Atradius 's interest

Share of income of associated companies

Associated companies

2016
Atradius 's interest

Associated companies

111

111

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

10 Financial investments
Financial investments classified
by measurement category andnatureAvailable-for-sale
2017

2016

2017

2016

2017

2016

Equity securities

293,976

290,904--

293,976

290,904

Debt securities

1,788,607

1,781,141--

1,788,607

1,781,141

Loans

-

-

26

25

26

25

Short-term investments--

166,338

181,503

166,338

181,503

Cash held for investments
Total

Loans and receivables 1)

Total

-

-

38,884

26,72038,884

26,7202,082,582

2,072,045

205,248

208,248

2,287,830

2,280,293

1) Including a bank deposit of EUR 30 million with a maturity of 90 days tacitly renewable

Movements in available-for-salefinancial investments

Equity securities

Debt securities

Total

2017

2016

2017

2016

2017

2016

290,904

398,056

1,781,141

1,536,876

2,072,045

1,934,932

Additions

26,87045,567560,021920,840

586,891

966,407

Disposals(42,649)(152,729)(500,821)(670,542)(543,470)(823,271)--(25,061)(26,906)(25,061)(26,906)

19,586(84)(2,860)19,09016,72619,006(735)

94(23,813)

1,783(24,548)

1,877

293,976

290,904

1,788,607

1,781,141

2,082,583

2,072,045

2017

2016

Accounts receivable on insurance and reinsurance business

164,983

153,405

Amounts owed by policyholders and direct insurance operations

116,941

129,983

Receivables arising out of reinsurance

48,042

23,422Other accounts receivable

60,09647,882

Total

225,079

201,287

Balance at 1 January

Amortisation charge for the year
Revaluations through othercomprehensive income andincome statement
Effect of movements in foreignexchange rates
Balance at 31 December

11 Receivables

The outstanding receivables are substantially all current and consequently their fair values do not materially differ
from their carrying amounts.
There is no concentration of credit risk in respect of receivables as Atradius has a large number of internationallydispersed debtors (see Note 4.3.2).
An amount of EUR 75.7 million (2016: EUR 78.8 million) relates to past due receivables on insurance and reinsurance
business for which no impairment loss has been recognised, 91.6% (2016: 88.9%) relates to receivables ageing less than
three months.
All receivables are considered for impairment testing. As of 31 December 2017, receivables of EUR 22.1 million (2016:
EUR 30.2 million) were considered to be partially impaired. The amount of the impairment taken related to thesereceivables was EUR 14.7 million (2016: EUR 17.6 million). This balance takes into account that a portion of theimpaired receivables will be recovered. Atradius does not hold any collateral over these balances.

112

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Movements on the provision for impaired receivables are presented in the following table:
2017

2016

Balance at 1 January

17,57622,964

Impairment of receivables

4,678

3,846

Receivables written off during the year as uncollectable(7,128)(8,592)

Unused amounts reversed

(433)

(642)

14,693

17,576

Balance at 31 December

The movement in the provision for impaired receivables for the insurance business is included in the premium line.
Amounts charged to the allowance account are generally written off when there is no expectation of recovery.

12 Deferred acquisition costs
2017

2016

73,12473,919233(2,749)Effect of movements in foreign exchange rates(3,916)

1,954

Balance at 31 December

69,441

73,124Current
Non-current

47,865
21,57650,472
22,652

Balance at 1 January
Change in deferred acquisition costs

13 Miscellaneous assets and accruals
2017

2016

Pipeline and ceded return premium

375,086

370,136

Prepayments and accrued interest

41,51939,550Net pension plan asset

20,814

2,584

Reimbursement rights

12,894

12,556

Other

20,705

21,406

Total

471,018

446,232

Pipeline premium relates to shipments made by Atradius’ policyholders for which Atradius is at risk but has not
invoiced the premium.
The miscellaneous assets and accruals are substantially all current and consequently the fair values of these assets do
not materially differ from their carrying amounts.
The reimbursement rights relate to the Spanish pension plans. Since the related policies do not qualify as aninsurance policy under IAS 19, the fair value cannot be netted with the related pension liability (see Note 17).
The net pension plan asset concerns the surplus of the pension plan in the UK; as per 31 December 2017 is EUR 20.8
million ( 2016: EUR 2.6 million) (see Note 17).

113

113

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

14 Cash and cash equivalents
2017

2016

Cash at bank and on hand

340,195

286,951

Short-term bank deposits

6,976

129

Cash and cash equivalents

347,171

287,080

Cash and cash equivalents

347,171

287,080

Bank overdrafts(5,993)(611)

341,178

286,469

Cash and cash equivalents in the statement of cash flows

Atradius manages the cash by using a cross-border cash pooling agreement. This provides for a notional pool structurewith interest compensation per currency. The cash pool arrangement allows for offsetting of cash balances ofbranches within a legal entity. However, it does not allow offsetting between different legal entities. Therefore, in thestatement of financial position, the related bank overdrafts that do not qualify for offsetting are presented separately
as liabilities under borrowings.

15 Capital and reserves
15.1

Share capital

The authorised share capital of Atradius N.V. amounts to EUR 250,000,000 and is divided into 250,000,000 ordinary
shares with a nominal value of EUR 1 each (2016: the same) of which 79,122,142 ordinary shares were issued and fully
paid (2016: the same). The fully paid ordinary shares carry one vote per share and carry the right to dividends.

15.2

Share premium reserve
2017

2016

Balance at 1 January639,228

639,228

Balance at 31 December

639,228

639,228

15.3

Revaluation reserve
2017

2016

Balance at 1 January

54,757

37,176

Change in revaluation reserve - gross

18,06921,382

Change in revaluation reserve - tax(5,235)(3,032)

Net (gains)/losses transferred to net profit on disposal - gross(5,215)(1,058)Net (gains)/losses transferred to net profit on disposal - tax

684

289

63,06054,757

Balance at 31 December

114

114

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

15.4

Currency translation reserve
2017

2016

Balance at 1 January(32,558)(31,733)

Change in currency translation reserve - gross(25,303)(1,869)Change in currency translation reserve - tax

2,248

1,044

(55,612)(32,558)

Balance at 31 December

Atradius’ significant foreign currencies and sensitivity to fluctuations are set out in Note 4.3.

15.5

Pension reserve

Balance at 1 January

2017

2016

(170,310)(138,190)

Recognised actuarial gains/(losses)

35,452(32,120)

Change in pension reserve - gross

45,643(40,045)

Change in pension reserve - tax(10,192)

7,925

Effect of the asset ceiling(2,465)-

Change in pension reserve - gross(3,286)-

Change in pension reserve - tax

822-(137,323)(170,310)

2017

2016

1,055,231

914,646

Dividends(76,748)(71,210)

Result for the year

186,275

211,795

1,164,758

1,055,231

Balance at 31 December

15.6

Retained earnings

Balance at 1 January

Balance at 31 December

15.7

Dividend distribution

Atradius’ dividend distribution is based on the Company financial statements. The Company and its subsidiaries are
subject to legal restrictions regarding the amount of dividends they can pay to their shareholders. The Dutch Civil Codecontains the restriction that dividends can only be paid up to an amount equal to the excess of the Company’s
shareholders’ equity and reserves required by law. Additionally, certain subsidiaries are subject to restrictions on theamount of funds they may distribute in the form of dividends or otherwise and also in respect of minimum capitalrequirements that are imposed by industry regulators in the countries in which the subsidiaries operate.
The Company distributes dividends out of the retained earnings balance. If this balance is insufficient, the Company
will distribute dividends out of the share premium reserve (see Note 4.2 in the Company financial statements).

115

115

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

16 Subordinated debt
2017

2016

Balance at 1 January323,437

248,289

Accretion of interest

177

148

Redemption--

Addition-

75,000323,614

323,437

Balance at 31 December

On 23 September 2014, Atradius Finance B.V. issued guaranteed subordinated notes with a nominal value of EUR
100,000 each for an aggregate amount of EUR 250 million (the ‘notes’). Atradius Finance B.V. may redeem the notes,
in whole but not in part, on 23 September 2024 and thereafter on each interest payment date. Unless previously
redeemed, the notes will be redeemed at maturity on 23 September 2044. The notes bear interest at a fixed rate of
5.250% per annum payable annually in the first 10 years, which will thereafter be reset to a floating 3 month-EURIBOR
plus a margin of 5.031% per annum payable quarterly for the remaining 20 years. The notes do qualify as regulatory
capital under the Solvency II grandfathering rules. The notes are issued by Atradius Finance B.V. and guaranteed by
the Company. The notes are listed on the Luxembourg Stock Exchange.
On 20 April 2016 the shareholders of Atradius N.V. provided a subordinated loan to Atradius Re with a principal
amount of EUR 75 million. The subordinated loan bears interest at a fixed rate of 5.0% per annum, payable annually inarrears on 20 April each year until and including the maturity date: 20 April 2026. Atradius Re may redeem the loanon the first call date, 20 April 2021, or thereafter on each interest payment date. The subordinated loan qualifies as
Tier 2 basic own funds item as set out in article 73 of the European Commission's Solvency II Delegated Regulation(2015/35).
The fair value estimate of the notes issued by Atradius Finance is EUR 295 million (2016: EUR 234 million). The fairvalue estimate of the subordinated loan issued by Atradius Re is EUR 80 million (2016: EUR 77 million). Both the fairvalue of the subordinated notes and the subordinated loan are classified as Level 2 under the fair value hierarchy andas Tier 2 basic own funds for Solvency II.
The fair value of the subordinated notes is based on binding quotes from independent brokers. The fair value of thesubordinated loan is based on a valuation model using observable data. The fair value estimate of the subordinatedloan is provided by an external independent valuation company, which uses its own proprietary valuation systems tovalue securities supported by economic and market assumptions from financial information providers. The model
calculates the present value of the subordinated loan’s cash flows discounted using the Euro government bond yield
curve as a benchmark and applying an appropriate risk spread. The risk spread applied is estimated using the credit
spreads of market quoted subordinated bond issues from similar issuers and with similar rating and maturity profiles.

17 Employee benefit assets and liabilities
2017

2016

Retirement benefits

73,880104,352

Other long-term employee benefits

5,673

5,099

Total

79,553

109,451

17.1

Retirement benefits

The employee benefit assets and liabilities relate mainly to pension assets and liabilities for defined benefit plans. The
main defined benefit plans are in the United Kingdom, Germany and the Netherlands and these represent 89% (2016:93%) of the defined benefit obligation. The other plans relate to Spain and Portugal, Italy, Switzerland, Sweden,
Belgium, Norway, France and Mexico. The recognition of assets and liabilities is determined separately for each plan.
Within Atradius there are also defined contribution plans. The contributions to these plans are recognised as expenses
in the income statement. The total contributions amounted to EUR 10.5 million in 2017 (2016: EUR 10.4 million).

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Pension assets and liabilities
The following table presents the change in the value of the net defined benefit liability:

Defined benefit
obligation

Fair value of plan
assetsAsset ceiling

Net defined benefit(asset) liability

2017

2016

2017

2016

2017

2016

2017

2016

Balance at 1 January

828,531

758,194

724,178

669,182--

104,353

89,012

Additions
Included in the income
statement:

37,325-37,529

-

(204)

-

Current service cost

14,724

12,362-

14,724

12,362

Past service cost

(2,462)(8,287)-(2,462)(8,287)

Interest cost / income

17,003

19,475

15,627

18,7001,376

775

Administration costs

532

450

-

-

532

450

2,797

7,059

-

-

2,797

7,059

1,122

10,535

1,249

7,920

-

-

(127)

2,615

33,716

41,594

16,876

26,620--16,84014,974

(100)

1,384

-

-

(100)

1,384

- financial assumptions(6,605)

108,191--(6,605)

108,191- experience adjustments(6,506)(8,749)--(6,506)(8,749)Return on plan assets
excluding interest income--

32,86155,893(32,861)(55,893)

Cost of Termination Benefits
Effect of movements inforeign exchange rates
Total included in the income
statement--

Included in OCI:
Remeasurement loss (gain):
Actuarial loss (gain) arisingfrom:- demographic assumptions

Change in Irrecoverable
Surplus other than Interest(3,286)-

3,286

Effect of movements inforeign exchange rates(12,947)(54,210)(12,988)(53,020)--

41(1,190)Total included in OCI(26,158)

46,616

19,873

2,873(3,286)-(42,745)

43,743

Other:
Contributions paid by theemployerPlan participants
contributions(3,416)(3,154)

19,17824,994(22,594)(28,148)

2,121

2,119

2,121

2,119

-

-

Benefits paid

(26,251)(16,698)(26,251)(16,698)

-

-

(30)

(140)

(30)

(140)

-

-

-

-

(18,230)

15,22818,230(15,228)

Total other(27,576)(17,873)(23,212)25,503--(4,364)(43,376)

Balance at 31 December

845,838

828,531775,244724,178(3,286)-73,880104,353

Additional benefits
Reclassification of surplus
plan assets

117

117

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedPlan assets
Atradius has pension related assets which under IAS 19 do not meet the criteria to qualify as plan assets. In Germany,for one of the plans, assets of EUR 16.7 million (2016: EUR 16.7 million) are classified as financial investments since inthe event of bankruptcy, these assets are not fully secured for the members of the pension plan. In the UK, EUR 29.9
million of financial investments (2016: EUR 29.7 million) is on an escrow account to support the UK pension fund. In
the event of insolvency, the Trustee of the pension fund has the right to those investments, provided certain conditions
are met.
The surplus of the UK pension plans as per 31 December 2017 is EUR 20.8 million (2016: EUR 2.6 million). is disclosed
as net plan pension assets as part of Note 13.
In Spain and Portugal, the defined benefit plans are partially insured with Seguros Catalana Occidente S.A.. These
insurance policies do not qualify as insurance policies under IAS 19, therefore the fair value is treated asreimbursement rights, which are recorded as part of other assets for an amount of EUR 12.3 million (2016: EUR 12.2
million). At the end of 2017, the defined benefit obligation related to the reimbursement rights amounts to EUR 24.6
million (2016: EUR 24.7 million). This same defined benefit obligation has in addition plan assets of EUR 15.1 million(2016: EUR 14.8 million).

118

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Characteristics of the main defined benefit plans
Characteristic
Entitlement

United Kingdom
Pension entitlements are basedon a percentage of final salary(closed to new employees).

Germany
Pension entitlements are basedon a percentage of the averagesalary of the last 10 years.

Number ofparticipants

152 active members (2016: 173
active members).
523 inactive members (2016: 494
inactive members).
EUR 282 million (2016: EUR 285
million).
EUR 303 million (2016: EUR 287
million).

504 active members (2016: 508
active members).
433 inactive members (2016: 418
inactive members).
EUR 121 million (2016: EUR 118
million).
EUR 76 million (2016: EUR 75
million). Assets of EUR 16.7
million (2016: EUR 17 million) arerecognised as part of the financial
investments.
EUR 1 million – loss (2016: EUR 2
million - loss).

Defined benefit
obligation
Plan assets

Remeasurement
gain (loss) through
OCI
Fundingarrangement

EUR 14.2 million - gain (2016:
EUR 20.3 million - loss).

Employeecontributions

In 2017 contributions amounted
to 7.1% (2016: 5.5%) of the eligible
salary.
Every three years an ALM-study is
performed to review theinvestment policy.

ALM-strategy

The basis of the funding
agreement lies in the Trust Deed
and Rules. The pension fundperforms triennial actuarial
valuations to determine employer
contributions.

The investment policy is to holdgovernment and corporate bonds
in respect of pensioners to
broadly match their liabilities andto hold assets expecting to delivera return in respect of the nonpensioners.

A Contractual Trust Agreement isestablished as a financing vehicle
to cover part of the pension
liabilities. There is no specificfunding arrangement although
the assets must exceed theinitially funded amount of EUR
39.2 million.
None; all contributions are madeby the employer.
The investment objectives andpolicies are developed based on
an ALM-study.
The investment policy limits theinterest rate risk by restricting theinvestment in bonds to fixed ratebonds. Equity price risk iscontrolled by investing according
to the Dow Jones Euro Stoxx 50
Index.

119

119

The Netherlands
Pension entitlements are basedon a percentage of the averagesalary (maximum of EUR 0.1
million - closed to new
employees).
317 active members (2016: 333
active members).
1,367 inactive members (2016:
1,319 inactive members).
EUR 331 million (2016: EUR
348 million).
EUR 334 million (2016: EUR
321.7 million).

EUR 27.2 million - gain (2016:
EUR 14.2 million - loss).
The employer pays a yearlybase premium as a percentageof the total sum of eligible
salaries of all active participants
which cannot be below thecost-effective premium for thatyear.
Employees contribute in 20177.0% (2016: 7.0%) of theireligible salary.
At least once every three years
an ALM-study is performed inwhich the impact of thestrategic investment policies
are analysed.
The interest rate risk is partiallyhedged within the investment
portfolio by the use of debt
instruments in combination
with liability driven investment
funds.

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedFair value of plan assets
The fair value of plan assets at the end of the reporting period is analysed in the following table:
Plan assets

2017

2016

Cash and cash equivalents

23,4012,432

Equity instruments

279,094

289,179

Debt instruments

209,100

184,302

Investment funds

188,220

210,707

Insurance contracts

61,072

23,891

Real estate

14,357

13,667775,244724,178

Total

All equity and debt securities have quoted prices in active markets. The plan assets do not include any of Atradius’
own financial instruments, nor any property occupied or other assets used by Atradius.
The expected rates of return on individual categories of plan assets are determined by reference to relevant indicespublished by the stock exchange of the particular country. The overall expected rate of return is calculated byweighting the individual rates for each asset class in accordance with the anticipated balance in the plan’s investment
portfolio. The actual return on plan assets (including reimbursement rights) was EUR 48.5 million (2016: EUR 78.2
million).
Actuarial assumptions
The principal assumptions used for the purpose of the actuarial valuations of the three main defined benefit plans arepresented in the following table:
Principal actuarial assumptions

United Kingdom

Germany

2017

2016

Discount rate

2.50%

2.50%

Price inflation rate

3.50%

3.25%

Expected increase of futuresalaries

2.40%

2.40%

3.00%

Expected increase of future benefit
levelsMortality table

Duration in years

2017

The Netherlands
2016

2017

2016

1.75%

1.75%

2.00%

1.75%

1.50%

1.50%

1.75%

1.75%

2.05%

2.05%

1.75%

1.75%

3.00%

1.25%

1.25%

0.875%

0.875%CMI 2015(1.5% LTR)

CMI 2015(1.5% LTR)

Heubeck
Richttafeln
2005 G

Heubeck
Richttafeln
2005 G

Prognosetafel
AG2016+ adjusted
experience

Prognosetafel
AG2016+ adjusted
experience

21

20

16

17

21

22

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

120

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

Defined benefit obligation

2017

2016

Increase

Decrease

Increase

Decrease

Discount rate (1% movement)(128,986)

170,004(135,294)

178,635

Price inflation rate (1% movement)

105,044(89,593)

92,574(89,035)

Future salary growth (1% movement)

18,034(15,718)

18,702(17,627)

Future pension growth (1% movement)

134,719(102,249)

140,618(110,748)

Future mortality (+1 year)

27,738n/a

28,544n/a

17.2

Defined benefit costs

A total defined benefit cost of EUR 16.0 million (2016: EUR 12.2 million) is recognised in the income statement undernet operating expenses (see Note 27). EUR 15.7 million (2016: EUR 11.7 million) relates to pension plans and EUR 0.3
million (2016: EUR 0.5 million) to other long-term employee benefits.

18 Insurance contracts
Credit insurance

Gross

Reinsurance
asset
2017

Net

Gross

Reinsurance
asset
2016

Net

Claims reported and loss adjustment
expenses

222,699(119,645)

103,054283,867(143,924)

139,943

Claims incurred but not reported

554,708(223,259)

331,449

511,587(232,790)

278,797

Claims provisions

777,407(342,904)

434,503795,454(376,714)

418,740

Provision for unearned premium

287,072(94,938)

192,134

285,841(97,034)

188,807

1,064,479(437,842)

626,637

1,081,295(473,748)

607,547

Claims reported and loss adjustment
expenses

186,784(67,005)

119,779

201,723(78,821)122,902

Claims incurred but not reported

63,968(7,090)56,87864,356(7,263)57,093Claims provisions

250,752(74,095)

176,657

266,079(86,084)

179,995

Provision for unearned premium

215,108(73,950)

141,158

213,781(72,430)

141,351

Total

465,860(148,045)

317,815

479,860(158,514)

321,346

Total insurance contracts

1,530,339(585,887)

944,452

1,561,155(632,262)

928,893

Current

1,038,894(403,849)

635,045

1,061,761(436,407)

625,354491,445(182,038)

309,407499,394(195,855)

303,539

Total
Bonding

Non-current

The liabilities for gross claims reported, loss adjustment expenses and claims incurred but not reported are net of
expected recoveries from salvage and subrogation.

18.1

Claims development tables

The claims development tables provide an overview of how Atradius’ recognised claims costs for underwriting years
2007-2016 have changed at successive financial year-ends. This overview also provides a breakdown of the claims
provisions (claims reported and loss adjustment expenses and claims incurred but not reported) that are held against
each underwriting year as at 31 December 2017. Underwriting year here means the year in which the risks were
accepted; for reinsurance business it is the treaty year.

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121

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Credit Insurance – Gross
Claims development per underwriting year – (EUR million)
Year when risk was
taken

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Estimate of grossclaims incurred:at the end of the year
when risk was taken

1,438.9

749.0

515.2

739.7

809.6

682.1

753.0

829.6

755.7

770.4

one year later

1,992.9

644.8

500.3

694.4

764.0

586.0

734.6

780.7

669.6

-

two years later

2,116.2

620.6

451.2

670.4

704.9

554.6

734.9

744.5

-

-

three years later

2,122.5

592.0

437.4

663.5

696.3

543.8

732.4

-

-

-

four years later

2,136.2

578.7

438.9

649.7

684.3

540.9

-

-

-

-

five years later

2,126.1

577.0

432.1

642.9

685.4

-

-

-

-

-

six years later

2,120.0

569.5

425.7

636.7

-

-

-

-

-

-

Total

seven years later

2,103.4

561.0

419.1

-

-

-

-

-

-

-

eight years later

2,084.5

557.3

-

-

-

-

-

-

-

-

nine years later
Current estimate of
cumulative claims
Cumulative payments
to date2,075.4

-

-

-

-

-

-

-

-

-

2,075.4

557.3

419.1

636.7

685.4

540.9

732.4

744.5

669.6

770.4

7,831.7

2,070.9

559.9

423.5

637.2

672.8

536.1

692.9

722.9

560.9

192.8

7,069.9

4.5

(2.6)

(4.4)

(0.5)

12.6

4.8

39.5

21.6

108.7

577.6

761.8

Claims provision at 31
December 2016 inrespect of 2008 - 2017
In respect of prioryears (before 2008)

15.6

Total

777.4

The table contains recognised claims costs only. It excludes the impact of losses from risks that have been accepted forwhich the premium has yet to be earned. The consequence of this is that the claims expense for a particularunderwriting year can increase in future financial years as both the premium and losses are recognised in the income
statement. This is relevant for the credit insurance business written by the local business in Spain and Portugal, thereinsurance business and instalment credit protection. The premium earned for underwriting years 2014-2016 in thecurrent financial year for these blocks of business was EUR 130.8 million.
After one year, underwriting year 2015 is currently higher than previous years, due to one large case for which EUR
90 million was included in the claim costs for 2015. The loss recognised for this case did not materially change in 2016
and 2017.
The claims development tables are presented on a gross basis. The effect of risk mitigation is in line with our quota
share treaties as included in Note 4.2, detailing further disclosures on insurance risk. The overall impact of risk
mitigation on claims provisions (for all underwriting years combined) is approximately 44%. Risk mitigation for grossclaims incurred as shown in this table varies between 42% and 47%. These differ from the quota share treaties due tothe private instalment credit protection which are not ceded and the inward reinsurance business which is covered by
Excess of loss treaties.

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Atradius | Consolidated financial statements 2017 Atradius N.V.

Bonding - Gross
Claims development per underwriting year – (EUR million)
Year when risk was
taken
Estimate of grossclaims incurred:at the end of the year
when risk was taken

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Total

13.2

10.7

10.2

19.3

19.0

21.7

19.0

21.0

16.8

13.6

one year later

33.2

22.1

25.7

48.8

48.6

32.6

34.6

26.8

22.8

-

two years later

38.8

30.7

36.4

60.8

53.7

39.1

43.6

31.5

-

-

three years later

45.6

34.8

43.4

62.8

58.4

42.0

45.8

-

-

-

four years later

49.3

36.3

43.4

57.4

58.7

41.0

-

-

-

-

five years later

50.6

38.4

42.4

60.7

58.5

-

-

-

-

-

six years later

52.1

38.1

42.1

64.2

-

-

-

-

-

-

seven years later

53.8

37.6

42.3

-

-

-

-

-

-

-

eight years later

56.9

34.9

-

-

-

-

-

-

-

-

nine years later
Current estimate of
cumulative claims
Cumulative payments
to date

56.3

-

-

-

-

-

-

-

-

-

56.3

34.9

42.3

64.2

58.5

41.0

45.8

31.5

22.8

13.6

410.9

43.2

27.2

30.8

51.6

37.6

18.9

15.6

6.9

8.1

1.1

241.0

13.1

7.7

11.5

12.6

20.9

22.1

30.2

24.6

14.7

12.5

169.9

Claims provision at 31
December 2016 inrespect of 2008 - 2017
In respect of prior years(before 2008)

80.9

Total

250.8

The claims costs do not include an estimate for future claim payments on cases where Atradius does not yet haveadverse information. This explains the increase in claims costs over time. For bonding, Atradius typically earns
premium in proportion to the length of time involved, over the tenor of the bond, meaning that while an increase in
the claims incurred can be seen, premium will also be recognised and this cannot be seen in the table above. The
premium earned for underwriting years 2014-2016 in the current financial year was EUR 80.2 million.
The claims development tables are presented on a gross basis. The effect of risk mitigation is in line with our quota
share treaties as included in Note 4.2, detailing further disclosures on insurance risk. The overall impact of risk
mitigation on claims provisions (for all underwriting years combined) is approximately 29.5%. Risk mitigation forgross claims incurred as shown in this table varies between 17% and 32%.

123

123

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

18.2

Insurance liabilities and reinsurance assets

18.2.1 Changes in insurance liabilities and reinsurance assets
Credit insurance

Gross

Reinsurance
asset
2017

Net

Gross

Reinsurance
asset
2016

Net

Balance at 1 January795,454(376,714)

418,740

908,070(423,685)

484,385

Claims paid in the year
Increase/(decrease) in liabilities
arising from claims
Foreign exchange rate and othermovements(621,369)

297,288(324,081)(731,227)

319,018(412,209)

637,287(277,292)

359,995

615,580(272,482)

343,098(33,965)

13,814(20,151)

3,031

435

3,466

Balance at 31 December

777,407(342,904)

434,503795,454(376,714)

418,740

Claims reported and loss adjustment
expenses

222,699(119,645)

103,054283,867(143,924)

139,943

Claims incurred but not reported

554,708(223,259)

331,449

511,587(232,790)

278,797

Total

777,407(342,904)

434,503795,454(376,714)

418,740

Balance at 1 January

266,079(86,084)

179,995

252,697(99,661)

153,036

Claims paid in the year
Increase/(decrease) in liabilities
arising from claims
Foreign exchange rate and othermovements(49,389)

19,336(30,053)(33,660)

13,554(20,106)

38,566(8,206)30,36045,713586

46,299(4,504)859(3,645)

1,329

(563)

766

Balance at 31 December

250,752(74,095)

176,657

266,079(86,084)

179,995

Claims reported and loss adjustment
expenses

186,784(67,005)

119,779

201,723(78,821)122,902

Bonding

Claims incurred but not reported

63,968(7,090)56,87864,356(7,263)57,093

Total

250,752(74,095)

176,657

266,079(86,084)

179,995

1,028,159(416,999)

611,160

1,061,533(462,798)

598,735

Claims provisions

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

18.2.2 Provision for unearned premium
Credit insurance

Balance at 1 January

Gross

Reinsurance
asset
2017

Net

Gross

Reinsurance
asset
2016

Net

285,841(97,034)

188,807292,852(99,961)

192,891

Movement in the period
Foreign exchange rate and othermovements

15,513(3,255)

12,258(4,502)

3,473(1,029)(14,282)

5,351(8,931)(2,509)(546)(3,055)

Balance at 31 December

287,072(94,938)

192,134

285,841(97,034)

188,807

213,781(72,430)

141,351

195,172(66,542)

128,630

7,892(2,617)5,275

11,885(4,479)7,406(6,565)

1,097(5,468)6,724(1,409)5,315

Balance at 31 December

215,108(73,950)

141,158

213,781(72,430)

141,351

Provision for unearned premium

502,180(168,888)

333,292

499,622(169,464)

330,158

Restructuring

Litigation

Total

Balance at 1 January

4,320

1,707

6,027

Additional provisions

523

324

847

Unused amounts reversed

(372)

(54)

(426)

(3,334)(74)(3,408)

(6)

-

(6)

Balance at 31 December

1,131

1,903

3,034

Current

1,131

-

1,131

-

1,903

1,903

Restructuring

Litigation

Total

Balance at 1 January

4,927

1,661

6,588

Business combinations

250

78

328

Additional provisions

3,275

159

3,434

Bonding
Balance at 1 January
Movement in the period
Foreign exchange rate and othermovements

19 Provisions
2017

Utilised
Effect of movements in foreign exchange rates

Non-current
2016

Unused amounts reversed(2,031)(63)(2,094)

Utilised(2,065)(128)(2,193)

(36)

-

(36)

Balance at 31 December

4,320

1,707

6,027

Current

4,320

-

4,320

-

1,707

1,707

Effect of movements in foreign exchange rates

Non-current

125

125

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedRestructuring
In 2015 a provision was established due to an intragroup reorganisation that has brought together AtradiusCredit Insurance N.V. and Compañía Española de Seguros y Reaseguros de Crédito y Caución S.A.u., into one legal
entity, Atradius Crédito y Caución S.A. de Seguros y Reaseguros. During 2017, the provision has been fully released.
Litigation
The litigation provision is related to disputes with third parties that are not related to the insurance business ofAtradius. Insurance business related litigation provisions are included in the provisions for outstanding claims. The
provision relates to the estimated cost including the costs of legal proceedings of any non-insurance claims against
Atradius. These provisions have not been discounted to reflect present value since the effect of discounting is notmaterial.

20 Deferred and current income tax
Current income tax
2017

2016

Current income tax assets

59,55950,613Current income tax liabilities

37,63623,960Net

21,92326,653The current income tax assets consist mainly of advances paid for local income tax. The current income tax liabilities
consist mainly of income and other local taxes payable.
Deferred income tax
2017

2016

Deferred income tax assets before set-off

124,023

142,773

Set-off of deferred tax positions(93,936)(97,458)

Net deferred tax assets as presented in the statement of financial position

30,08745,315

Deferred income tax liabilities before set-off

218,887

212,637

Set-off of deferred tax positions(93,936)(97,458)

Net deferred tax liabilities as presented in the statement of financial position

124,951

115,179

2017

2016

Balance at 1 January(69,864)(59,189)

Business combination

-

1,220

Credit (charge) to other comprehensive income for the year

(13,922)

4,680

Charge to the income statement for the year

(12,558)(17,018)

The gross movement on the deferred income tax is presented in the following table:

Effect of movements in foreign exchange rates
Balance at 31 December

126

126

1,480

443

(94,864)(69,864)Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

The movement in the deferred tax assets and liabilities is presented in the following table:
2017

Balance at 1
January

Recognised in
Recognised
other in the income
comprehensive
statement
income for thefor the year
year

Effect ofmovements
in foreignexchange

Business
combination

Balance at 31
DecemberTax losses carried forward

12,543

(205)

(166)

-

12,171

Technical balances

9,916

3,230

(26)

-

13,120Pensions

28,933

2,900

(43)

-

22,420Fiscal goodwill

10,011(2,617)

(109)

-

7,285

(9,370)Financial investments(11,100)

2,703

175

-

(12,773)

Equalisation provisions(109,587)(4,960)981-(113,566)

Property, plant and equipment(14,047)

487

14

-

(13,545)

Other

3,467

(14,096)

654-(9,975)

Total(69,864)(12,558)

1,480-(94,864)2016

Balance at 1
January

Recognised in
Recognised
other in the income
comprehensive
statement
income for thefor the year
year

Effect ofmovements
in foreignexchange

Business
combination

Balance at 31
December

(150)

1,220

12,543Tax losses carried forward(4,552)(13,922)

14,455-(2,982)

Technical balances

14,733-(5,094)

277

-

9,916

Pensions

19,502

7,925

(311)

1,817

-

28,933Fiscal goodwill

12,774-(2,746)(17)-

10,011

Financial investments(7,829)(3,245)

(22)

(4)

-

(11,100)

Equalisation provisions(100,648)-(8,939)--(109,587)(13,555)

-

(386)

(106)

-

(14,047)

Other

1,379

-

3,462

(1,374)

-

3,467

Total

(59,189)

4,680(17,018)

443

1,220

(69,864)

Property, plant and equipment

Deferred income tax assets are recognised for tax losses carried forward, unused tax credits, and deductible
temporary differences, to the extent that it is probable that taxable profits will be available against which the unused
tax losses carried forward, unused tax credits, and deductible temporary differences can be utilised. In 2017, EUR 1.4
million deferred tax assets on the losses carried forward and deductible temporary difference were written down or
not recognised (2016: EUR 1.3 million). This is offset by the reversals of the impairments, prior year adjustments andforeign exchange, resulting in a net reversal of these deferred tax assets.
Atradius has unrecognised tax losses carried forward balances amounting to EUR 54.8 million (2016: EUR 58.6
million). The expiration of these unrecognised tax losses carried forward is included in the following table:
Expiration unrecognised tax losses carried forward

2017

2016

1 - 3 years

434

102

4 - 9 years

8,573

11,379Indefinite

45,802

47,128

Total

54,80958,609The increase of unrecognized tax losses is mainly due to the impairment of deferred tax assets on the losses carriedforward mentioned above.

127

127

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

The deferred and current income tax charged or credited to other comprehensive income during the year is presented
in the following table:
Deferred tax

Current tax

Deferred tax

2017

Current tax

2016

Revaluation reserve in shareholders equity related to:
Available-for-sale financial investments(4,551)-(3,245)501(9,370)

-

7,925

-

-

2,248

-

1,044

(13,921)

2,248

4,680

1,545

2017

2016

Accounts payable on insurance and reinsurance business

129,822

183,407

Payables arising out of reinsurance operations

78,223

106,441

Amounts due to policyholders

36,75962,930

Amounts due to intermediaries and current account Dutch State

14,84014,036

Trade and other accounts payable

71,12549,339Accounts payable

31,71634,133

Other accounts payable

39,40915,206

Total

200,947

232,746

2017

2016

Ceded pipeline premium and return premium

193,678

182,908

Deposits received from reinsurers

44,88245,535

Unearned reinsurance commission

56,431

57,191

Payroll and bonus accruals

44,94442,152

Reinsurance accruals

30,039

9,598

Other accruals

73,85365,884

Pension reserve in shareholders equity related to:
Recognised actuarial gains/(losses)
Currency translation reserve in shareholders equity related to:Currency translation reserve
Total

21 Payables

The payables are substantially all current.

22 Other liabilities

IPT and stamp duties payable

4,914

5,239

Other taxes

11,105

11,075459,846

419,582

Total
Other liabilities are substantially all current.

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Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

23 Net premium earned
Credit insurance

Gross

Reinsurers'
share
2017

Net

Gross

Reinsurers'
share
2016

Net

Written premium

1,431,588(625,505)

806,083

1,383,867(607,949)

775,918(15,513)3,255(12,258)

4,502(3,473)

1,029

2,612

(1,142)

1,470

3,939

(2,080)1,859

1,418,687(623,392)

795,295

1,392,308(613,502)

778,806

Written premium

177,363(54,881)

122,482

177,240(54,843)

122,397

Change in provision for unearned
premium(7,892)

2,617(5,275)(11,885)

4,479(7,406)

Change in provision for unearned
premium
Other movements
Total
Bonding

Other movements
Total
Total premium earned

(63)

27

(36)

(75)

35

(40)

169,408(52,237)

117,171

165,280(50,329)

114,951

1,588,095(675,629)

912,466

1,557,588(663,831)

893,757

24 Service and other income
2017

2016

Collections and recovery services

44,71041,543

Information services and fees

130,830

127,396

Other service income

73,60034,140

Total

249,140

203,079

Information services income and fees are part of the insurance segment. Collections and recovery services and otherservice income are part of the service segment.

129

129

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

25 Net income from investments
Net investment income by type of investment

2017

2016

12,221

13,86658Equity securities available-for-sale

14,473

15,572Other investments

1,045

995

Total income from financial investments

27,74430,441416

424

28,16030,865

IncomeDebt securities available-for-sale
Loans

Investment property
Total investment income
Expenses
Debt securities available-for-sale(1,037)(1,615)Equity securities available-for-sale(2,403)(7,484)

Handling expenses(3,731)(3,385)

Total expenses from financial investments(7,171)(12,484)

Investment property

(403)

(102)

Total investment expenses(7,574)(12,586)

Net income from investments

20,586

18,279

Share of income/ (losses) of associated companies(7,396)

26,689Net income from investments including associated companies

13,19044,968130130

Atradiusstatements 20172017 Atradius
Atradius N.V.
N.V.
Atradius || Consolidated
Consolidated financial
financial statements

Net investment income by nature of income/(expense)

2017

2016

Interest

11,42812,899Dividends

9,001

9,762

Realised gains

7,315

7,810

Rental income from investment property

416

394

28,16030,865

Handling expenses(3,731)(3,385)

Realised losses(2,100)(6,722)

Impairment loss

(1,609)(2,377)

(134)

(102)

Total

(7,574)(12,586)

Net income from investments

20,586

18,279

Share of income of associated companies

3,678

6,808

Impairments of associated companies(11,701)-

Realised gains

165

22,208Other

462(2,327)

Income

Total
Expenses

Depreciation of investment property

Total(7,396)

26,689Net income from investments including associated companies

13,19044,968In interest income and expenses reported above, the component related to financial investments available-for-sale is
net EUR 10.3 million (2016: EUR 11.9 million); this is derived from government and corporate bonds.

Net gains/(losses) by category

Impairments

Realised
gains/(losses)
2017

Investment property

Impairments

Realised
gains/(losses)
2016

(269)

-

-

30

Financial assets classified as available-for-sale(1,340)5,215(2,377)

1,058

Total

(1,609)5,215(2,377)

1,088

131

131

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

26 Insurance claims
Credit insurance

Gross

Reinsurers'
share
2017

Net

Gross

Reinsurers'
share
2016

Net

621,369(297,288)

324,081731,227(319,018)

412,209

Change in claims provisions

15,917

19,99435,911(115,647)

46,536(69,111)Claims handling expenses

36,468-36,46835,326-35,326

Total

673,754(277,294)

396,460

650,906(272,482)

378,424

Claims paid in the year

49,389(19,336)

30,053

33,660(13,554)

20,106

Change in claims provisions(10,824)

11,132308

12,05314,14026,193Claims handling expenses

2,163

-

2,163

1,773

-

1,773

Total

40,728(8,204)32,52447,486586

48,072

Total insurance claims

714,482(285,498)

428,984

698,392(271,896)

426,496

Claims paid in the year

Bonding

For more detail on the change in claims provisions, see Note 18.2.1.

132

132

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

27 Net operating expenses
2017

2016

Total administrative expenses

522,738

478,441

Acquisition costs

207,871

202,008

Change in deferred acquisition costs

(233)

2,749

Gross operating expenses

730,376

683,198

Commissions received for business ceded to reinsurers(256,447)(251,873)

Total net operating expenses

473,929

431,325

2017

2016

436,372

451,504

Recoveries and collections expenses

45,14343,439Other service expenses

73,024

13,296

Group costs

6,745

6,986

Total gross administrative expenses

561,284

515,225

Claims handling expenses allocated to insurance claims(38,546)(36,784)

Total administrative expenses

522,738

478,441

Administrative expenses by type of businessInsurance and information expenses

As part of the gross administrative expenses, depreciation, amortisation and impairment charges for intangible assets
and property, plant and equipment amount to EUR 29.5 million (2016: EUR 30.2 million).

Employee benefit expenses

2017

2016

315,971

292,076

151

1,244

Pension costs - defined contribution plans

10,50010,406

Pension costs - defined benefit plans

16,057

12,201

342,679

315,927

2017

2016

17,065

15,894

Salaries and wages (including social security costs)
Restructuring costs and termination benefits

Total employee benefit expenses
For an explanation of the employee benefit details see Note 17.

28 Finance expenses
Interest and fees on the subordinated debt
Net interest on the net defined benefit liability

1,243

681

Other interest expense

1,483

4,211

Foreign exchange (income)/expense(520)(8,042)

19,271

12,744Total

The subordinated debt costs include the periodic interest expenses of EUR 16.9 million (2016: EUR 15.7 million) and theaccretion of interest on the debt in the amount of EUR 0.2 million (2016: EUR 0.2 million).

133

133

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

29 Income tax
2017

2016

Current tax

56,51445,774

Deferred tax

12,55817,018

Income tax expense/(income) for the year

69,07362,792

The reconciliation from the expected tax rate to the actual tax rate is provided in the following table:
2017

2016

255,308

274,564

Tax calculated at domestic tax rates applicable to results in the respective countries

62,37074,291

Tax exempt (income)/loss

1,398(7,494)

Write down/(reversal) of deferred tax assets

(849)

(206)

Reassessment of prior year local tax positions

1,313

(416)

Impact of change in tax rate

1,326

(1,464)

Result before tax

Other
Income tax expense/(income) for the year

3,516

(1,919)69,07362,792The weighted average applicable tax rate was 24.4% (2016: 27.1%).
Deferred tax assets relating to losses carried forward in certain entities have been impaired or reversed. This isincluded in ‘write down (reversal) of deferred tax assets’.
The impact of the change in tax rate in 2017 mainly reflects the effect of changes in income tax rate in Turkey, UK and
the US.
The category ’Other’ includes non-deductible expenses, regional taxes such as IRAP in Italy.

30 Dividends per share
The dividends paid in 2017 and 2016 were EUR 76.7 million (EUR 0.97 per share) and EUR 71.2 million (EUR 0.90 per
share) respectively.

31 Assets not freely disposable
The financial assets not freely disposable in 2017 are EUR 235.5 million (2016: EUR 307.5 million). Assets that are notfreely disposable consist of financial investments, properties and cash that have been held mainly for local regulatory
purposes and can be used to cover technical provisions. The amount of pledged assets not covering technicalprovisions is EUR 82 million (2016: EUR 84.6 million).

32 Capital commitments and contingencies
Capital commitments of EUR 18.3 million (2016: EUR 21.1 million) are related to contracted obligations for future
payments for outsourcing, networking, imaging and licences.
The Group has contingent liabilities in respect of matters arising in the ordinary course of business. It is not
anticipated that any material liabilities will arise from the contingent liabilities. The Group has given guarantees tothird parties amounting to EUR 1 million (2016: EUR 2.0 million).

134

134

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

33 Operating leases
Non-cancellable operating lease commitments are included in the following table:
2017

2016

Less than one year

23,077

21,031

Between one and five years

56,84659,365More than five years

18,233

21,491

Total

98,156

101,887

Atradius leases office equipment and office space under a number of operating lease agreements. The lease contracts
have remaining terms of between 1 and 20 years. The leasing of office space represents around 86.5% (2016: 92%) of
the total future payments regarding operating leases.
During the year an amount of EUR 26.0 million (2016: EUR 22.5 million) has been recognised as expense.

34 Personnel
The number of employees working for Atradius is included in the following table:
20172016 1)

Total average number of employees (full-time equivalent)

3,591

3,584

Total year end number of employees (full-time equivalent)

3,596

3,586

Total year end number of employees (headcount)

3,756

3,758

1)

The comparative figures have been adjusted to include Informes Mexico S.A. de CV..

35 Related party transactions
The following table provides the total value of transactions which have been entered into with related parties in thefinancial year:
Associatedcompanies

Parent (1)2017

Associatedcompanies

Parent (1)2016

Sales to related parties

14,368

1,205

7,801

1,110

Purchases from related parties

5,416

4,829

1,283

9,528

Amounts owed by related parties

15

28,956844

28,796

Amounts owed to related parties

793

437

860

531

(1)

Subsidiaries of Grupo Catalana Occidente, S.A.

Sales to related parties consist of the net effect of Reinsurance business (premiums, claims, recoveries andcommission) and for information services provided to Atradius. Purchases from related parties consist of the net effectof (retro-) ceded insurance (premiums, claims, recoveries and commission). The amounts owed by related Atradiuscompanies consist of the fair value of insurance policies as calculated under the requirements of IAS 19.
Terms and conditions of transactions with related parties
No guarantees have been provided or received for any related party receivables for 2017 or 2016. For the years ending
31 December 2017 and 2016, Atradius has not raised any provision or expenses for doubtful debtors relating toamounts owed by related parties.

135

135

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

Subordinated debt
Plus Ultra, Seguros Generales y Vida, S.A. de Seguros y Reaseguros, Seguros Catalana Occidente S.A. de Seguros y
Reaseguros and Bilbao Compañía Anónima de Seguros y Reaseguros; subsidiaries of the ultimate parent of the Grouppurchased EUR 54.3 million (21.7%) of the guaranteed subordinated notes issued by Atradius Finance B.V.. In 2017 theinterest expense relating to this portion was EUR 2.9 million (2016: EUR 2.4 million).
In 2016 the shareholders of Atradius N.V. provided a subordinated loan to Atradius Re with a principle amount of EUR
75 million. In 2017 the interest expense relating to this subordinate loan was EUR 3.5 million.
The related party share for the subordinated debt is as follows:
Lenders

Nominalvalue

Interest
expense2017

Nominalvalue

Interest
expense2016

Plus Ultra, Seguros Generales y Vida, S.A. de
Seguros y Reaseguros

40,0002,098

40,0002,104

Seguros Catalana Occidente S.A. de Seguros y
Reaseguros

34,636

1,865

34,291

1,028

Bilbao Compañía Anónima de Seguros y
Reaseguros

42,7172,158

42,0001,428

Nortehispana, de Seguros y Reaseguros S.A.

6,000

300

6,000

210

123,353

6,421

122,291

4,770

Total

All relationships with related parties are at arm’s-length.
Compensation of key current and former management personnel of Atradius
The following table provides details on the remuneration for members of the Management Board, Supervisory Boardand other identified staff. Other identified staff are the members of the RSMB, not part of the Management Board, andother staff members that hold key management positions.

Remuneration

2017

2016

Short-term employee benefits (1)

1,754

2,814

Long-term employee benefits

1,258

464

Post-employment benefits

309

352

Total compensation paid to Management Board members

3,321

3,630

5

5

Short-term employee benefits (1)

595

510

Total compensation paid to Supervisory Board members

595

510

Number of members

109Management Board

Number of members

Supervisory Board

1)

Short-term employee benefits include salaries, housing, social security, medical expenses, lease cars and other.

From the total compensation for Management Board members, EUR 3.0 million (2016: EUR 3.2 million) has been paid
at the end of the reporting period. The remaining balance payable is subject to meeting the variable pay conditions.
The Management Board and Supervisory Board members also participate in the Boards of some of the subsidiaries.
Apart from this they do not have other relationships with the Company or its subsidiaries.

136

136

Atradius | Consolidated financial statements 2017 Atradius N.V.
Atradius | Consolidated financial statements 2017 Atradius N.V.

36 Events after the reporting period
There are no events to report.

137

137

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedCompany financial statements 2017
Contents
Company financial statements ............................................................................................................................................... 139
Notes to the company financial statements
1

General information .............................................................................................................................................................141

2

Summary of significant accounting policies ...............................................................................................................141

3

Investments in group companies ................................................................................................................................... 142

4

Capital and reserves ............................................................................................................................................................ 142

5

Other liabilities...................................................................................................................................................................... 143

6Contingencies ........................................................................................................................................................................ 143

7

Personnel ................................................................................................................................................................................ 144

8 Auditor fees ............................................................................................................................................................................. 144
9 Remuneration of Management Board and Supervisory Board .............................................................................. 144
10 Proposed profit appropriation ......................................................................................................................................... 144
11 Events after the reporting period .................................................................................................................................... 145

138

138

Atradius | Company financial statements 2017 Atradius N.V.
Atradius | Company financial statements 2017 Atradius N.V.

Company financial statements
Company statement of financial position (before profit appropriation)
AssetsNote

Fixed assets
Property, plant and equipment
Investments in group companies

3

31.12.201731.12.2016

1,751,480

1,627,757

10

24

1,751,470

1,627,733

Current assets

38,8593,380

Receivables from group companies

16,619511

Deferred income tax assets

1,560

1,560

Current income tax assets

5,795

-

Cash and cash equivalents

14,8851,309

1,790,339

1,631,137

79,122

79,122862,883

862,883

Total
EquityCapital and reserves attributable to the owners of the Company

4

Share capital
Share premium reserve
Legal reserve(66,408)(96,864)Retained earnings

691,360

568,534

Result for the year (unappropriated)

186,275

211,795

1,753,232

1,625,470

Current liabilities

37,107

5,667

Payables to group companies

32,059

5

5,048

4,083

-

1,579

37,1075,667

1,790,339

1,631,137

2017

2016

188,750

219,899(2,475)(8,104)

186,275

211,795

Total
Liabilities

Other liabilities

5

Current income tax liabilities
Total
Total equity and liabilities

Company income statement
Income after tax from group companies
Other results after tax
Result for the year

139

139

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise statedCompany statement of changes in equity

Balance at 1 January 2016
Change in revaluation reserve andpension reserve group companies

SharecapitalShare Legal reserve
premium
reserve

Retainedearnings

Result for
the year

Total

79,122862,883(84,426)

464,449

178,2211,500,249--(14,539)--(14,539)

Change in currency translation reserve
Net income recognised directly inequity

-

-

(825)

-

-

(825)

-

-

(15,364)--(15,364)

Appropriation of prior year result

-

-

-

178,221(178,221)-

Result for the year

-

-

-

-

211,795

211,795

Change in reserve intangible assets

-

-

2,926

(2,926)--

Dividends
Balance at 31 December 2016

79,122862,883(96,864)(71,210)568,534

211,795(71,210)
1,625,470

Balance at 1 January 201779,122862,883(96,864)

568,534

211,795

1,625,470--

41,290--41,290Change in revaluation reserve andpension reserve group companies
Change in currency translation reserve
Net income recognised directly inequity--(23,055)--(23,055)--

18,235--

18,235

Appropriation of prior year result

-

-

-

211,795(211,795)-

Result for the year

-

-

-

-

186,275

186,275

Change in reserve intangible assets--

12,221(12,221)--

79,122862,883(66,408)(76,748)
691,360

186,275(76,748)
1,753,232

Dividends
Balance at 31 December 2017

140

140

Atradius | Company financial statements 2017 Atradius N.V.
Atradius | Company financial statements 2017 Atradius N.V.

Notes to the Company financial statements
1

General information

Atradius N.V. (referred to as the ‘Company’) is based in Amsterdam (The Netherlands) and registered at the Dutch
Chamber of Commerce under number 34196963,
The Company financial statements are part of the 2017 consolidated financial statements, which are also included in
the annual report. The Company income statement is presented in abbreviated form in accordance with Article 402 ofBook 2 of the Dutch Civil Code.
The Company has applied the provisions of Article 379, Subsection 5 of Book 2 of the Dutch Civil Code. The list referred
to in this article has been included in the appendix and is filed at the offices of the Commercial Register in Amsterdam.
The Company has issued a statement of liability in accordance with Article 403, Book 2 of the Dutch Civil Code for thefollowing Atradius companies: Atradius Collections B.V., Atradius Collections Holding B.V., Atradius Credit
Management Services B.V. and Atradius Information Services B.V.
The Company financial statements have been authorised for issue by the Management Board on 9 March 2018.

2

Summary of significant accounting policies

2.1

Basis of presentation

The Company annual financial statements have been prepared in accordance with Part 9, Book 2 of the Dutch Civil
Code. In the preparation of the Company annual financial statements, the provisions of Article 362, Subsection 8 ofBook 2 of the Dutch Civil Code have been applied. The valuation principles for assets and liabilities and the method ofdetermining the result are identical to those applied in the consolidated financial statements. Reference is made to thenotes thereto.
All amounts in the notes are shown in thousands of Euro (EUR), rounded to the nearest thousand, unless otherwise
stated.

2.2

Investments in group companies

Atradius companies are valued using the equity method in accordance with the accounting principles applied in the
consolidated financial statements.

2.3

Legal reserve

The legal reserve has to be created under Dutch legislation for the reserves established by subsidiaries that cannot be
distributed and relates to:
Revaluation reserve;
Pension reserve;
Currency translation reserve;
Reserve intangible assets.

141

141

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated3

Investments in group companies

The following table shows the changes in investments in group companies valued using the equity method:
2017

2016

1,627,733

1,497,408

Investments in group companies

34,000-Share of profit/(loss)

188,750

219,899

Dividends received(117,248)(74,210)

Change in revaluation reserve and pension reserve

41,290(14,539)

Balance at 1 January

Foreign exchange reserve movements
Balance at 31 December

4

Capital and reserves

4.1

Share capital(23,055)(825)

1,751,470

1,627,733

The authorised share capital of Atradius N.V. amounts to EUR 250,000,000 and is divided into 250,000,000 ordinary
shares with a nominal value of EUR 1 each (2016: the same) of which 79,122,142 ordinary shares were issued and fully
paid (2016: the same). The fully paid ordinary shares carry one vote per share and carry the right to dividends.

4.2

Share premium reserve
2017

2016

Balance at 1 January862,883

862,883

Balance at 31 December

862,883

862,883

2017

2016

Balance at 1 January(96,864)(84,426)

Change in revaluation reserve and pension reserve group companies

41,290(14,539)

Change in currency translation reserve(23,055)

(825)

4.3

Legal reserve

Change in reserve intangible assets
Balance at 31 December

12,221

2,926(66,408)(96,864)

The total amount of equity in the company financial statements equals shareholders’ equity in the consolidated
financial statements. Certain components within equity are different in the company financial statements due to legal
reserves, established by subsidiaries of Atradius N.V., which in accordance with Book 2, Part 9 of the Dutch Civil Code,
Article 389, Subsection 6, cannot be distributed. In particular:-changes in revaluation of group companies, which consists of unrealised revaluations withinconsolidated group companies presented in the revaluation reserve in the consolidated financial
statements, and actuarial gains and losses and effect of asset ceilings within consolidated groupcompanies presented in the pension reserve in the consolidated financial statements, are presented
together in the legal reserve in the company financial statements;

142

142

Atradius | Company financial statements 2017 Atradius N.V.
Atradius | Company financial statements 2017 Atradius N.V.

-

foreign currency translations on consolidated group companies, presented in the currency translation
reserve in the consolidated financial statements, are presented in the legal reserve in the company
financial statements.

In addition to the legal and regulatory restrictions on distributing dividends from subsidiaries to Atradius N.V., there
are various other considerations and limitations that are taken into account in determining the appropriate levels ofequity in the Group’s subsidiaries. These considerations and limitations include, but are not restricted to, local
regulatory regulations and rating agency requirements, that can change over time. It is not possible to disclose areliable quantification of these limitations. Reference is made to paragraph 4.5 Capital Management in the
consolidated annual report.
The following table shows the split of the legal reserve at the end of the reporting period:
2017

2016

Revaluation reserve and pension reserve group companies(74,266)(115,556)

Currency translation reserve(37,404)(14,349)

Reserve intangible assets

45,262

33,041

Total(66,408)(96,864)

2017

2016

Balance at 1 January568,534

464,449

Appropriation of prior year result

211,795

178,221Transfer between legal reserve and retained earnings(12,221)(2,926)

Dividends(76,748)(71,210)

Balance at 31 December

691,360

568,534

2017

2016

157

401

Long-term employee benefits

1,451

652

Other liabilities

3,440

3,030

Total

5,048

4,083

4.4

5

Retained earnings

Other liabilities

Other taxes

6

Contingencies

The Company has contingent liabilities in respect of guarantees arising in the ordinary course of business. It was not
anticipated that any material liabilities will arise from the contingent liabilities. The Company gave guarantees tothird parties in the ordinary course of business amounting to EUR 0.5 million (2016: EUR 0.5 million).
Atradius N.V. is head of the Dutch fiscal unity for corporate income tax, consisting of Atradius N.V., Atradius Insurance
Holding N.V., Atradius Finance B.V., Atradius Crédito y Caución S.A. de Seguros y Reaseguros, Dutch branch, Atradius
Participations Holding B.V., Atradius Information Services B.V., Atradius Collections Holding B.V., Atradius Collections
B.V., and Graydon Holding N.V. (including its Dutch subsidiaries). All companies included in the fiscal unity are jointly
and severally liable for the corporate income tax payable in the Netherlands by the fiscal unity.
The Company is subject to litigation in the normal course of business. The Company believes that such litigation will
not have a material effect on its profit or loss and financial condition.
143

143

All amounts in thousands of Euro, unless otherwise stated
All amounts in thousands of Euro, unless otherwise stated

The Company acts as the guarantor for the guaranteed subordinated loan, EUR 250 million, (2016: EUR 250 million)
issued by Atradius Finance B.V. (see Note 16 of the consolidated financial statements).

7

Personnel

The number of employees working for the Company:
2017

2016

Total average number of employees (headcount)

6

6

Total year end number of employees (headcount)66

8 Auditor fees
The following expenses were made for audit and non-audit services rendered by Atradius’ external auditor:
2017 Including VAT

Deloitte
Accountants
B.V.

Other Deloitte
Networkorganisations

Total Deloitte
Network

Audit financial statements

646

1,831

2,477

Other audit services

147

415

562

Fiscal advisory services

-

-

-

Non-audit services

-

-

-

793

2,246

3,039

Deloitte
Accountants
B.V.

Other Deloitte
Networkorganisations

Total Deloitte
Network

Audit financial statements

842

1,791

2,633

Other audit services

326

468

794

Fiscal advisory services

-

-

-

Non-audit services

-

-

-

1,168

2,259

3,427

Total
2016 Including VAT

Total

These amounts relate to the actual expenses incurred for the audit of the related financial year, and other services, onan accrual basis.

9 Remuneration of Management Board and Supervisory Board
For information on remuneration of the members of the Management Board and the Supervisory Board: see Note 36 of
the consolidated financial statements.

10 Proposed profit appropriation
Proposed appropriation of result
The Management Board proposes to the General Meeting to allocate the result for the year to the retained earnings andto make a distribution of EUR 83.9 million out of the retained earnings.

144

144

Atradius | Company financial statements 2017 Atradius N.V.
Atradius | Company financial statements 2017 Atradius N.V.

11 Events after the reporting period
There are no events to report

145

145

Atradius | Annual Report 2017 Atradius N.V.
Atradius | Annual Report 2017 Atradius N.V.

Other information

147

146

Atradius | Annual Report 2017 Atradius N.V.
Atradius | Annual Report 2017 Atradius N.V.

Statutory appropriation of result
In accordance with article 24 of the Articles of Association the result for the year is at the disposal of theGeneral Meeting

148

147

Atradius
Report2017
Atradius
N.V.
Atradius | Annual| Annual
Report2017
Atradius
N.V.

Annual Report Atradius N.V.
Amsterdam, 9 March 2018
The Supervisory Board

The Management Board

Ignacio Álvarez, Chairman
Francisco Arregui, Vice-Chairman
Bernd H. Meyer
Dick Sluimers
Xavier Freixes
Hugo Serra
Désirée van Gorp
John Hourican
Carlos Halpern
José Maria Sunyer

Isidoro Unda, Chairman
Andreas Tesch
Christian van Lint
Claus Gramlich-Eicher
Marc Henstridge

149

148

Atradius | Independent auditor’s report Atradius N.V.
Atradius | Independent auditor’s report Atradius N.V.

Independent auditor’s report
To the shareholders and the Supervisory Board of Atradius N.V.

REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS THE YEAR ENDED 31 DECEMBER 2017
INCLUDED IN THE ANNUAL ACCOUNTS
Our opinion
We have audited the accompanying financial statements the year ended 31 December 2017 of Atradius N.V. based in
Amsterdam. The financial statements include the consolidated financial statements and the company financial statements.
In our opinion:-

The accompanying consolidated financial statements give a true and fair view of the financial position of Atradius N.V. asat 31 December 2017, and of its result and its cash flows for the year ended 31 December 2017 in accordance with
International Financial Reporting Standards as adopted by the European Union (EU-IFRS) and with Part 9 of Book 2 of
the Dutch Civil Code.

-The accompanying company financial statements give a true and fair view of the financial position of Atradius N.V. as at
31 December 2017, and of its result for the year ended 31 December 2017 in accordance with Part 9 of Book 2 of the Dutch
Civil Code.

The consolidated financial statements comprise:1.

The consolidated statement of financial position as at 31 December 2017.

2. The following statements for 2017: the consolidated income statement, the consolidated statement of comprehensive
income, the consolidated statement of changes in equity and the consolidated statement of cash flows.
3. The notes comprising a summary of the significant accounting policies and other explanatory information.
The company financial statements comprise:1.

The company statement of financial position as at 31 December 2017.

2. The company income statement for the year ended 31 December 2017.
3. The notes comprising a summary of the accounting policies and other explanatory information.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. Our responsibilities underthose standards are further described in the “Our responsibilities for the audit of the financial statements” section of ourreport.
We are independent of Atradius N.V. in accordance with the Verordening inzake de onafhankelijkheid van accountants bij
assurance-opdrachten (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence) and otherrelevant independence regulations in the Netherlands. Furthermore we have complied with the Verordening gedrags- en
beroepsregels accountants (VGBA, Dutch Code of Ethics).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

REPORT ON THE OTHER INFORMATION INCLUDED IN THE ANNUAL ACCOUNTSIn addition to the financial statements and our auditor’s report thereon, the annual accounts contain other information thatconsists of:-

The consolidated management report-

Other Information as required by Part 9 of Book 2 of the Dutch Civil Code

Based on the following procedures performed, we conclude that the other information:

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Atradius | Independent auditor’s report Atradius N.V.

-

Is consistent with the financial statements and does not contain material misstatements.

-

Contains the information as required by Part 9 of Book 2 of the Dutch Civil Code.

We have read the other information. Based on our knowledge and understanding obtained through our audit of the financial
statements or otherwise, we have considered whether the other information contains material misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the Dutch Civil Code and the Dutch
Standard 720. The scope of the procedures performed is substantially less than the scope of those performed in our audit of
the financial statements. As such it is not our responsibility to report on the true and fair view of the Solvency II information
included in the consolidated management report.
Management is responsible for the preparation of the other information, including the consolidated management report inaccordance with Part 9 of Book 2 of the Dutch Civil Code, and the other information as required by Part 9 of Book 2 of the
Dutch Civil Code.

DESCRIPTION OF RESPONSIBILITIES REGARDING THE FINANCIAL STATEMENTS
Responsibilities of management and the Supervisory Board for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with EU-IFRS
and Part 9 of Book 2 of the Dutch Civil Code. Furthermore, management is responsible for such internal control as
management determines is necessary to enable the preparation of the financial statements that are free from material
misstatement, whether due to fraud or error.
As part of the preparation of the financial statements, management is responsible for assessing the company’s ability tocontinue as a going concern. Based on the financial reporting frameworks mentioned, management should prepare thefinancial statements using the going concern basis of accounting unless management either intends to liquidate the company
or to cease operations, or has no realistic alternative but to do so.
Management should disclose events and circumstances that may cast significant doubt on the company’s ability to continue
as a going concern in the financial statements.
The supervisory board is responsible for overseeing the company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit assignment in a manner that allows us to obtain sufficient and appropriate
audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may not detect all material
errors and fraud during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The
materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified
misstatements on our opinion.
We have exercised professional judgement and have maintained professional skepticism throughout the audit, in accordancewith Dutch Standards on Auditing, ethical requirements and independence requirements. Our audit included e.g.:-

Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error,
designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.

-

Obtaining an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s
internal control.

-

Evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.

-

Concluding on the appropriateness of management’s use of the going concern basis of accounting, and based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt

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Atradius | Independent auditor’s report Atradius N.V.

on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required
to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
-

Evaluating the overall presentation, structure and content of the financial statements, including the disclosures.

-

Evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.

Because we are ultimately responsible for the opinion, we are also responsible for directing, supervising and performing thegroup audit. In this respect we have determined the nature and extent of the audit procedures to be carried out for group
entities. Decisive were the size and/or the risk profile of the group entities or operations. On this basis, we selected group
entities for which an audit or review had to be carried out on the complete set of financial information or specific items.
We communicate with management regarding, among other matters, the planned scope and timing of the audit andsignificant audit findings, including any significant findings in internal control that we identified during our audit.
We provide the supervisory board with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on
our independence, and where applicable, related safeguards.
Amsterdam, 9 March 2018
Deloitte Accountants B.V.
Signed on the original: R.J.M Maarschalk

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Atradius | Glossary

Glossary
Atradius Atrium
Online credit management portal giving customers and brokers access to all the information they need to manage
their policies and apply for credit limits in one place, in real time.

Bonding (product)
The activity of providing guarantees that protect the beneficiary if the supplier fails to meet the agreed performancelevel. Bonding is also known as surety.

Buyer
A customer of our insured customer (i.e. the holder of the credit insurance policy). Buyers carry a credit risk such as
protracted default, insolvency and bankruptcy. This could lead to a financial loss for our customer / policyholder.
Buyer underwriting is related to the assessment of this credit risk.

Buyer underwriting
The activity related to the risk acceptance of credit risk of buyers. Buyer underwriting determines the credit limits
that are attached to the credit insurance policy and determines the amount for which shipments are insured. Buyers
are assessed on financial and non-financial criteria, including financial status, profitability, liquidity, size, region,
trade sector and payment experience.

Claim
An application by an insured customer for indemnification of a loss under the policy.

Claims ratio
A performance indicator that is defined as total claims including claims handling expenses divided by total
insurance revenue.

Combined ratio
The combined ratio is calculated using the general insurance standard; the sum of the claims and the insurance
expenses divided by total insurance revenue.

Credit insurance (product)
Commercial and/or political risk insurance whereby the customer is protected against non-payment of tradereceivables due to insolvency or default.

Credit limit
The maximum exposure specifically approved or otherwise authorised by the insurer in respect of a buyer.

Debt collection
Activity to collect monies owed by a company. Atradius offers this service to both insured customers and third
parties.

Economic capital
The amount of risk capital, assessed on a realistic basis, required by a company to cover its risks assumed underinsurance contracts.

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Atradius | Glossary

Eurozone
Refers to the European Union member states that have adopted the Euro as their currency.

Expense ratio
A performance indicator that is defined as total insurance expenses divided by total insurance revenue.

Exposure
Total amount underwritten by the insurer as cover on a buyer, a country, under a policy or under all policies.

Financial year
A period used for calculating annual financial statements but which does not require that the period reported on
constitutes a calendar year.

GlobalAtradius’ product and service offering to multinational customers, which provides tailored credit management
solutions for customers worldwide in several languages and currencies.

Atradius Insights
An advanced online business intelligence tool to support our customers with a detailed analysis of their debtor
portfolio and help them in managing their buyer portfolios and credit risks.

Insolvency
Legally recognised inability of a debtor to meet its commitments and pay its debts.

Instalment credit protection
Atradius’ offering to financial and corporate policyholders in Belgium and Luxembourg, that protects against
short and medium-term risks involved in multiple instalment agreements with private individuals and businesses(business-to-consumer).

Insurance revenue
The total of gross earned premium and information income (i.e. credit checking fees).

Medium-term businessBusiness (capital goods and major projects) transacted on credit terms of between two and five years.

Policyholder
Our insured customer; the party that purchases an insurance policy for protection against the risk of non-payment by(foreign or domestic) buyers and assumes responsibilities and obligations under that policy.

Policy underwriting
The activity related to establishing the terms and conditions of the insurance policy designed to mitigate
unacceptable risks. These terms and conditions include premium rate, maximum credit periods, the insurer’s
maximum liability, the customer’s own retention and other risk sharing and mitigation aspects.

Political risk
The risk that a government buyer or a country prevents the fulfilment of a transaction, or fails to meet its payment
obligations, or the risk that is beyond the scope of an individual buyer or falls outside the individual buyer’s
responsibility.

Premium
Amount paid by an insured customer to the insurer in return for risk coverage.

Reinsurance
A risk-sharing operation, whereby the insurer obtains cover from a third party (the reinsurer) for part of the credit
risks that it has guaranteed, in exchange for the payment of a premium.

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Atradius | Glossary

Reinsurance business
The activity whereby Atradius acts as a reinsurance company for credit insurance and bonding business of primary
insurers. This activity is performed by a dedicated team of underwriters at Atradius Reinsurance DAC.

SME
Small and medium-sized enterprises.

Solvency II
An EU Directive that codifies the EU insurance regulation. It introduces a new regulatory framework and has comeinto effect on January 2016. The Solvency II Directive aims to create a harmonised, risk-orientated solvency regime
resulting in capital requirements for (re) insurance companies that are more reflective of the risks they run. Its
objectives are to deepen the integration of the EU insurance market, to improve the protection of policyholders andbeneficiaries, to improve the international competitiveness of EU insurers and to instil better regulation of the EU
insurance markets.

Underwriter
Person charged with risk acceptance, control of that risk and the setting of cover conditions on buyer/credit limits,
including any country-specific terms of cover.

Underwriting year
The year in which a risk is accepted for a shipment from a customer/policyholder to its buyer. The underwriting
year performance provides management with important insight into the buyer (risk) underwriting performance. In
addition, it gives information about the most recent underwriting year performance without any impact from previous
underwriting years.

UN Global Compact
A United Nations strategic policy initiative for Businesses that are committed to aligning their operations and strategies
with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption.

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Overview of subsidiaries,
associated companies andminority shareholdings
The following table sets forth, as at 31 December 2017, the name and jurisdiction of establishment of the subsidiaries,
branches, associated companies and minority shareholdings of Atradius N.V. All companies are, directly or indirectly,
wholly owned unless otherwise indicated. The companies are listed in alphabetical order.
Name
African Trade Insurance Agency
Al Mulla Atradius Insurance Consultancy & Brokerage (L.L.C.)
Atradius Collections B.V.
Belgium branch
Canada branch
Czech Republic branch
Denmark branchFrance branch
Germany branch
Hungary branch
Ireland branch
Italy branch
Poland branch
Turkey branch
Atradius Collections Holding B.V.
Atradius Collections Limited
Atradius Collections Limited
Atradius Collections Limited
Atradius Collections Pte. Limited
Atradius Collections Pty. Limited
Atradius Collections Serviços de Cobranças de Dívidas Ltda
Atradius Collections, S.A. de C.V.
Atradius Collections S.L.
Atradius Collections, Inc.
Atradius Corporate Management Consulting (Shanghai) Co., Ltd.
Atradius Credit Insurance Agency, Inc.
Atradius Credit Management Services B.V.
Atradius Credit Management Services (RUS) LLC
Atradius Crédito y Caución S.A. de Seguros y Reaseguros
Australia branch
Austria branch
Bulgaria branch
Belgium branch
Canada branch
Czech Republic branch
Denmark branch
Finland branchFrance branch
Germany branch
Greece branch
Hong Kong branch
Hungary branch
Ireland branch
Italy branchJapan branch
Luxembourg branch
Netherlands branch
New Zealand branch
Norway branch
Poland branch
Portugal branch
Romania branch
Singapore branch
Slovakia branch
Sweden branch
Switzerland branch
Turkey branch
United Kingdom branch
Atradius Crédito y Caución Seguradora S.A.

Country
OwnershipKenya
1 share
UAE
49%
Netherlands
Belgium
CanadaCzech Republic
Denmark
FranceGermany
Hungary
Ireland
Italy
PolandTurkeyNetherlands
CanadaHong Kong
United Kingdom
Singapore
Australia
BrazilMexico
Spain
USA
China
USA
Netherlands
RussiaSpain
Australia
Austria
Bulgaria
Belgium
CanadaCzech Republic
Denmark
FinlandFranceGermany
GreeceHong Kong
Hungary
Ireland
Italy
Japan
Luxembourg
Netherlands
New Zealand
NorwayPolandPortugal
Romania
Singapore
Slovakia
SwedenSwitzerland
TurkeyUnited Kingdom
BrazilName
Atradius Dutch State Business N.V.
Atradius Enterprise Management Consulting (Shanghai) Co., Ltd.
Atradius Finance B.V.
Atradius Information Services B.V.
Belgium branch
Denmark branchFrance branch
Germany branch
Ireland branch
Italy branchJapan branch
Norway branch
Spain branch
Sweden branch
Switzerland branch
Thailand branch
United Kingdom branch
Atradius India Credit Management Services Private Ltd.
Atradius Insurance Holding N.V.
Atradius Investments Limited
Atradius Italia Intermediazioni S.R.L.
Atradius Participations Holding B.V.
Atradius Pension Trustees Ltd.
Atradius Reinsurance DAC
Atradius Rus Credit Insurance LLC
Atradius Seguros de Crédito, S.A.
Atradius Trade Credit Insurance, Inc.
Atradius Trade Insurance Brokerage Yuhan Hoesa
CLAL Credit Insurance Ltd.
Compagnie Tunisienne pour l'Assurance du Commerce Exterieur S.A.
Compania de Seguros de Crédito Continental S.A.
Credit Guarantee Insurance Corporation of Africa Ltd
Crédito y Caución do Brasil Gestao de Riscos de Crédito e Serviços LTDADAP Holding N.V.
Galilean Properties Proprietary Ltd
Gestifatura S.A.
Giant-net B.V.
Graydon Holding N.V.
Graydon Incasso B.V.
Graydon Nederland B.V
Graydon Belgium N.V.
Graydon UK Ltd.
Hotel Maatschappij de Wittenburg B.V.
Iberinform Internacional S.A.u.
Iberinmobiliaria, S.A.u.
Iberinform Portugal S.A.
Informes Mexico, S.A. de C.V.
Invercyca, S.A.u.
NCM (UK) Holdings Ltd. (3)NCM Credit Insurance Ltd. (3)NCM Teri Ltd. (3)NCM UK Agency Ltd. (3)Nederlandse Financieringsmaatschappij voor Ontwikkelingslanden N.V.
OpenCompanies B.V.
PT Atradius Information Services Indonesia
Starzyński i Wspólnicy Kancelaria Prawna spółka komandytowa
Technical Credit Insurance Consultants S.A.
The Lebanese Credit Insurer s.a.l.
Verenigde Assurantiebedrijven Nederland N.V.
(1)

Minus one share;

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(2)

minus 3 shares;(3)

Country
Ownership
Netherlands
China
Netherlands
Netherlands
Belgium
Denmark
FranceGermany
Ireland
Italy
Japan
NorwaySpain
SwedenSwitzerland
Thailand
United Kingdom
India
Netherlands
Ireland
Italy
Netherlands
United Kingdom
Ireland
RussiaMexicoUSA
South Korea
Israel20.00%
Tunisia4%
Chile
50%(1)South Africa
25%
BrazilNetherlands
2%South Africa
25%
Portugal
80%(2)
Netherlands
Netherlands
Netherlands
Netherlands
Belgium
United Kingdom
Netherlands
3%
Spain
Spain
Portugal
80%(2)
MexicoSpain
United Kingdom
United Kingdom
United Kingdom
United Kingdom
Netherlands
1%
Netherlands
Indonesia
Poland100.0%
Belgium
Lebanon48.90%
Netherlands
0.65%

are in liquidation or are to be liquidated

Disclaimer
The information in the chapter ‘The global economic environment in 2017’ is for general guidance on matters ofinterest only. While we have made every attempt to ensure that the information contained in this report reflects carefulanalysis and investigations on our side before publication of this Annual Report, we are neither responsible for any
errors or omissions nor for the results obtained from the use of this information.
The information in this Annual Report does not contain nor imply a warranty as to the completeness, accuracy,
timeliness or otherwise. Atradius, its related partnerships or corporations, or the directors, partners, agents or
employees thereof will in no event be liable to you or anyone regarding any decision made or action taken in relianceon the information in this Annual Report or for any consequential, special or similar damages.

Produced and publishedThis Annual Report is published by Atradius N.V.
Your contact
Christine Gerryn – Director Group Communication & Commercial Development
Phone: +31 20 553 2047
Email: christine.gerryn@atradius.com

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