Universal Registration Document 2022

Introduction

The threshold indicating a significant increase in credit risk is reached when the counterparty ceases to be rated “Investment Grade”. The significant increase in the default risk may lead to reassessment of the ECL over the instrument’s residual life.

For loans and receivables, the Group has chosen an approach based on the probability of default by the counterparty and assessment of changes in the credit risk.

18.1.1 Breakdown between current and non-current financial assets

Current and non-current financial assets break down as follows:

  31/12/2022 31/12/2021
(in millions of euros) Current Non-current Total Current Non-current Total
Instruments at fair value through OCI with recycling 17,014 4,982 21,996 10,519 5,810 16,329
Instruments at fair value through OCI with no recycling 36 207 243 37 253 290
Instruments at fair value through profit and loss 1,409 23,490 24,899 2,855 25,369 28,224
Debt and equity securities 18,459 28,679 47,138 13,411 31,432 44,843
Trading derivatives – Positive fair value 30,566 - 30,566 20,061 - 20,061
Hedging derivatives – Positive fair value 6,903 5,376 12,279 4,522 5,388 9,910
Loans and financial receivables (1) 2,105 14,457 16,562 1,943 18,789 20,732
CURRENT AND NON-CURRENT FINANCIAL ASSETS 58,033 48,512 106,545 39,937 55,609 95,546

(1) Including impairment of €(386) million at 31 December 2022 (€(299) million at 31 December 2021).

The increase in the positive fair value of trading derivatives (+€10.5 billion) is explained by an increase in the value of derivatives used in the trading activity, principally associated with commodity market price movements observed in 2022, and to a lesser extent the higher volumes contracted.

18.1.2 Debt and equity securities
Details of debt and equity securities

Financial assets are monitored and managed by the Group with two main objectives:

  • dedicated assets set aside in France for secure financing of nuclear plant decommissioning expenses and long-term storage expenses for radioactive waste, as required by Article  L.  594 of France’s Environment Code. These assets consist of diversified investments in bonds, monetary and equity investment funds, and equity investments held by EDF Invest. The general management policy for dedicated assets and a breakdown of the portfolio is presented in note 15.1.2;
  • assets managed according to a liquidity-oriented policy (“liquid assets”). These are financial assets consisting of funds or interest rate instruments with initial maturity of over three months that are readily convertible into cash. EDF’s monetary investment funds included in liquid assets amount to €1,115 million at 31 December 2022 (€2,597 million at 31 December 2021).

Details of debt and equity securities are shown in the table below:

  31/12/2022 31/12/2021
(in millions of euros) At fair value through OCI with recycling At fair value through OCI with no recycling At fair value through profit and loss Total Total
Debt and equity securities        
EDF dedicated assets 4,627 - 22,742 27,369 31,013
Liquid assets 17,148 - 1,359 18,507 12,737
Other assets (1) 221 243 798 1,262 1,093
TOTAL 21,996 243 24,899 47,138 44,843

(1) Investments in non-consolidated companies.