annual report 2012 sg finans as

headline annual report 2012 sg finans as

2 The board of directors in SG Finans AS From left: Jacques Bensen, Country Supervisor SGEF, Paris, Kaci Kullmann Five, Advisor public affairs, Bærum, Marie-Christine Ducholet, CEO, Société Générale Equipment Finance, Paris, Jean-Marc Mignerey, Independent Board Director and Carsten Thorne, CEO SG Finans AS.* * Tommy Pedersen, Independent Board Director, CEO Augustinus Fonden, Denmark and Kjell Vegard Opheim, Employee representative, were not present at the photo session.

3 contents SUMMARY 5 Stronger business 5 Key figures 6 REPORT OF THE BOARD OF DIRECTORS 7 The company 8 Activities 8 Company development 8 Market conditions 9 Financial result 9 Corporate governance 10 Risk management 11 Organisation 11 Future prospects 12 ORGANISAtion 13 Vision and values 13 Brands and image 13 SG Finans AS organisation and management 13 Societe Generale Equipment Finance 2012 14 SG Finans Norway 15 SG Finans Denmark 16 SG Finans Sweden 17 ANNUAL ACCOUNTS 19 Profit and loss account 19 Balance sheet/assets 20 Liability and equity 21 Cash flow statement 22 Statement of changes in equity 23 Notes 24 Auditor s report and statement from the control committee 57 EMPLOYEE REPRESENTATIVES AND MANAGEMENT 58 ADDRESSES 59

4 "Our financial performances make SG Finans still one of the three largest contributors to the consolidated result of Societe Generale Equipment Finance (SGEF), Europe's leader in equipment financing." Carsten Thorne CEO SG Finans AS

summary 5 STRONGER BUSINESS Coverage of liquidity and long-term capital level requirements and priority of customer relations SG Finans consolidated in 2012 its position as a leading finance company in Scandinavia. The total result for the overall operations of NOK 431,7 million, one of the best since 2005, is very satisfactory in light of a year of instability and unpredictability in the markets. We both increased our revenues in 2012, and also developed other revenue streams in addition to the net interest margin. In addition, we maintained good control of expenses and losses. For our Swedish operations, losses were higher than normal, but we observe a strong improvement in underlying earnings in the business in Sweden. The government s changes to the regulation of banking and finance in 2012 have led to stricter rules for the coverage of liquidity risk and increased capital levels. It has been of great importance for our business and has been a limiting factor for the development of the company s loan portfolio. Liquidity and capital becoming scarce, SG Finans, as other financial institutions, had to prioritise strongly the clients and partners the company wanted to continue financing. The company s core business however remains unchanged. We will continue to work, with our local presence and European network, to meet Nordic businesses requirements for capital intensive equipment, funding and administrative services by offering flexible financial solutions. key to the continued development of the company and will have a high priority in all countries. Total new sales in 2012 were slightly up compared to 2011. We have in 2012 maintained our position as the market leader in equipment and factoring in Norway, and we have made good progress in our Danish operations. For Sweden s part, 2012 was a year marked by a necessary reduction in the total lending portfolio. For Scandinavia, 2012 was all in all a very satisfactory year. I want to thank our customers and partners for the confidence they have placed in us and look forward with optimism to the future good relationship that can contribute to the good development for the Nordic industry. Carsten Thorne CEO SG Finans AS On this basis, it is gratifying that our customer satisfaction surveys conducted in 2012 have shown that we have strengthened our reputation as a predictable and reliable partner for our customers and supplier partners. Cooperation with major capital goods suppliers are also undoubtedly the

6 KEY FIGURES Amounts in NOK thousands 2012 2011 Profit & Loss Net operating income 1 131 330 1 128 397 Operating expenses -530 723-541 151 Operating profit before losses 600 607 587 246 Losses on loans -168 971-174 491 Net profit before tax 431 636 412 756 Loans outstanding NORWAY Equipment 13 489 928 14 225 794 Transport 4 503 250 4 523 102 Factoring 1 728 907 1 661 459 Others 2 989 349 2 903 992 Total Norway 22 711 433 23 314 347 DENMARK / SWEDEN Equipment Denmark 2 372 370 2 449 810 Equipment Sweden 4 265 656 5 043 184 Total Denmark and Sweden 6 638 026 7 492 994 Total loans 29 349 459 30 807 341 Risk weighted assets 23 676 408 25 109 457 Total regulatory capital 2 776 896 2 914 259 Capital adequacy ratio 10,75 % 10,73 %

REPORT OF THE BOARD OF DIRECTORS 7 REPORT OF THE BOARD OF DIRECTORS Going into 2012, attention was particularly drawn to regulatory changes for banks and financial institutions. For SG Finans AS, mainly increased regulatory requirements for coverage of liquidity risk and increased capital ratio have had immediate impact. The changes in capital markets and the banks and investors risk appetite lead together with the strengthened regulatory requirements, to restricted access to liquidity and capital at the beginning of the year. Liquidity and capital thus became limitary factors for the development of the company s portfolio of funded assets. Liquidity and capital becoming scarce, SG Finans AS as other financial institutions, had to prioritise strongly the clients and partners the company wanted to continue financing. Given the prevailing circumstances at the start of 2012, the company adapted its strategy and risk appetite in some channels. Among others, we have in 2012 been more restrictive to financing of equipment through intermediaries. Concurrently, a tight and efficient management of the balance sheet has been necessary. An important element in the strategy was to lift off parts of existing funded assets, to ensure we could maintain our financing capacity for new business. This has been achieved among other through the sale of individual contracts and parts of the portfolio, thereby ensuring that SG Finans AS still maintains its strong position as an important and long-term partner for Scandinavian businesses. After two years with lower volumes, we saw in 2011 an increase in demand for new financing in Scandinavia. The level of demand for new financing is maintained largely at the same level through 2012, with growth in some segments. The total volume of new financing in Scandinavia grew by 0,6 %. Also in 2012, the growth was relatively speaking strongest in Denmark, with a growth of 14,4% compared to the year before, while the nominal amount of new lending to customers is still highest in Norway. Totally, the company established new financing for slightly above NOK 9,9 billion. Gross lending dropped by 4,7 % from the previous year, from NOK 30,8 billion to NOK 29,3 billion. This must be seen in connection with the measures implemented as part of the company s management of the balance-sheet; with the objective to maintain the company s capacity to finance existing and new clients and partners. The company thus maintains its position as market leader in Norway and it is a strong contributor to the financing of businesses in both Denmark and Sweden. SG Finans AS has maintained its strategy to develop and keep long-term relationships to customers and partners in the local market. In addition to a tight management of liquidity needs and capital consumption, control and management of operating expenses has been a central area. In this respect 2012 is marked by strong prioritisation on the income side and the cost side as well. During 2012, SG Finans has implemented several measures to increase efficiency and optimisation with the objective to adjust the cost side in line with the evolution in funded assets. This can be seen as a reduction in operating expenses, notably other operating expenses. During the year, the number of staff has been reduced with 15 staff. The reduction in number of staff comes as a result of increased efficiencies in operations and internal support processes. The Norwegian labour market has in 2012 been in a particular situation compared to the rest of Europe, and also Scandinavia. With very low unemployment

8 REPORT OF THE BOARD OF DIRECTORS and a tight labour market, the competition for highly skilled staff has still been strong. The organisation has managed the situation in an effective manner. A strong focus on sales and market activities characterises the organisation, and thanks to our skilled and motivated employees in addition to the good relations with our customers and partners, the company delivered in 2012 again very good financial results. (All the following figures are for SG Finans AS). The company s operating profit before tax came to MNOK 431,6. Total loans outstanding amounted at year-end to NOK 29,3 billion. This represents a drop in funded assets of 4,7% during the year. THE COMPANY SG Finans AS is a wholly owned company of the Société Générale Group. The company is part of the Société Générale Equipment Finance business line which is Europe s leading player for equipment leasing. Factoring is an important focus area. Société Générale is a leading financial group in the Euro zone. The head office is located in Paris. At year-end there were 160.000 employees in the Société Générale Group. ACTIVITIES With a local presence and a European network, SG Finans AS aims to satisfy the requirements of Scandinavian trade and industry for capitalintensive equipment, liquidity and administrative services. The company is a Scandinavian finance company, and its business is carried out through a broad, Scandinavian distribution network with 16 regional and sales offices in Norway, 5 offices in Sweden and 2 in Denmark. The company s head office is located in Lysaker. At the end of the year the company had 358 employees. This represents a net reduction of 15 employees during the year. The activities of SG Finans do not pollute the external environment; however, some leasing objects may cause pollution when they are used. SG Finans is reporting a number of indicators for the company s environmental impact, which are part of Société Générale Group s sustainability reporting. The report is available on the Société Générale Group s web pages. COMPANY DEVELOPMENT 2012 has been another eventful year largely marked by the economic situation of the countries in southern Europe. This has also impacted the situation in Scandinavia. After several years of continuous growth in total loans as well as number of financed contracts, the development turned in 2008-2009. After a growth in 2011, total loans outstanding in Scandinavia dropped by 4,7% during 2012. This is a result of management of funded assets, as the company has reduced some portfolios of financing, combined with a tightening of our credit and pricing policies. SG Finans AS established new financing for a total of NOK 9,9 billion in 2012, which is an increase of 0,6% compared to 2011. Credit margins on new financing have increased since 2009, and in 2012 the margins on new lending are slightly up compared to 2011. The overall level of margins in 2012 is somewhat below the levels in 2009 and 2010 though. Also in 2012, the volumes of new lending has grown relatively speaking most in Denmark, with a growth of 14,4% compared to 2011. At the same time, the company has decided to reduce the growth in new lending in Sweden, after several years of strong growth, and in 2012 the volume of new lending in Sweden dropped by 12% compared to 2011. At the end of 2012, the activities in Denmark and Sweden represent 22,6 % of total loans outstanding, while the branches in Denmark and Sweden establish more than one third of new financing in Scandinavia also in 2012. SG Finans maintains its position as the market leader in equipment finance in Norway, and maintains its market shares in both Sweden and Denmark at a satisfactory level. The company is also market leader in ordinary factoring in Norway. It is our objective to continually develop products and systems within the areas of factoring and equipment leasing. As an important part of the company s focus on relationship-strengthening activities, a number of market initiatives and events were carried out also in 2012. The primary objective of these activities has been to strengthen relations with the company s most important customers and partners. A goal for the future is to continue developing the company s Scandinavian corporate culture and further strengthen its brands, SG Equipment Finance and SG Factoring.

REPORT OF THE BOARD OF DIRECTORS 9 MARKET CONDITIONS For several years the Norwegian finance companies have enjoyed favourable growth as a result of the strong development in the Norwegian economy, but the development has since 2008 turned further to the change in the business cycle. This has also impacted SG Finans. Scarcity of capital and increasing prices on liquidity has led to changes in the pricing of credit. At the start of 2013 the economic prospects are generally better for Scandinavian business compared to southern Europe, but the development is still uncertain and dependent on a positive development for the southern part of Europe. SG Finans enjoys a very strong market position for its products in the Norwegian market. Based on figures provided by the Association of Norwegian Finance Houses as of 31.12.2012, the company s market shares are as follows: Equipment leasing 27,5 % Factoring (ordinary) 39,2 % SG Finans thereby retains its position as a market leader in Norway within both product areas. The company has also maintained its position in Sweden and Denmark at a satisfactory level, and SG Finans is thus one of Scandinavia s leading finance companies. FINANCIAL RESULTS For 2012 the operating profit before taxes for SG Finans AS was MNOK 431,6 compared to MNOK 412,8 in 2011. The company s net banking income was in 2012 MNOK 1.131,3 compared to MNOK 1.128,4 in 2011. The increase in income is mainly linked to higher other income, in particular sales gains on terminated contracts and sale of financed equipment. The net interest margin is somewhat lower in 2012 compared to the year before. This is due to increased funding costs and adaptation of maturities on funding compared to lending. The operating expenses amounted to MNOK 530,7 compared to MNOK 541,2 the previous year. Staff expenses represent approximately 61 % of the total expenses in 2012, which is slightly above the level of previous year. This must be seen in connection with the measures implemented to increase efficiency and to adapt the cost side with the development of the outstanding loans. This has lead to a reduction of other operating expenses of 12,6%. Staff expenses increase by 6,5% as a result of increase in pension liabilities and an increase in projectrelated bonuses to staff. Also in 2012 the number of bankruptcies has been relatively high. In particular we have observed a negative development in number of bankruptcies and credit losses in Sweden in the second half of 2012. This has lead to a total cost of risk above long term average, and total cost of risk is in 2012 approximately at the same level as in 2011. At the end of 2012, total cost of risk amounted to MNOK 169,0. This is a reduction of MNOK 5,5 or 3,2% from 2011, when cost or risk amounted to MNOK 174,5. Measured against average funded assets the cost of risk was at 0,63% compared to 0,65% in 2011. This is a slight improvement in the cost of risk, but still remains at a higher level compared to historic cost of risk and the company s targets for the risk profile of the portfolios. Total write-downs for credit risk was at year end MNOK 199,2, corresponding to 0,76 % of total loans outstanding. This is a reduction of MNOK 37,5 during the year. In comparison, at the end of 2011, total write-downs for credit risk represented MNOK 236,7, or 0,77 % of total loans outstanding. Gross doubtful loans were MNOK 630,6 compared to MNOK 751,9 the previous year. This represents 2,4 % of total loans outstanding, which is the same level as in 2011. Because of the continued high number of bankruptcies, the uncertainty in relation to future losses must still be assessed as larger than normal. Write-downs for credit losses are done based on individual engagements, and the company has not made write-downs for groups of assets. This is in line with the business line Société Générale Equipment Finance s principles and guidelines. The Board assesses that the writedowns for credit losses represent a satisfactory estimate of expected losses in the portfolio by year end 2012. In the second half of 2012, the development of loan losses has been high, but under control, in Sweden. At the start of 2013 we see signs of improvement. We therefore expect lower cost of risk in 2013 than the previous three years, but still at a higher level than our long-term targets for average cost of risk over a 5 years period. Assets that are repossessed as a result of defaulted leasing and loan contracts amounted at year end to MNOK 67,8 from total 268 contracts. This is a reduction of MNOK 40,9 during the year compared

10 REPORT OF THE BOARD OF DIRECTORS to MNOK 108,7 from total 376 contracts at the end of 2011. Turnover during the year from the sale of repossessed assets amounts to MNOK 353,5 which is a reduction from 2011 when the turnover was MNOK 409,7. The company has achieved acceptable prices on sale of repossessed assets in 2012, and the market for second-hand equipment has generally improved compared to the previous year. Total loans outstanding has decreased from NOK 30,8 billion to NOK 29,3 billion. This is a reduction of 4,7 % during the year. The branches in Sweden and Denmark represented 22,6 % of total loans at the end of the year. This is a small decrease of their relative share since the end of 2011, when Denmark and Sweden represented 24 % of total loans outstanding. The company s equity was MNOK 3.453,1 including the net result of the year at end 2012. Regulatory capital for the calculation of the capital coverage amounted to MNOK 2.776,9 as of 31.12.12. The net result of the year and expected dividend are deducted in the calculation of regulatory capital. The capital coverage by the year end 2012 was 10,75 %, which is at the same level as at the end of 2011. The capital base consists of core capital only. The company presented in 2009 its application to the regulator to use internal models for the calculation of the regulatory capital requirement for credit risk for a number of portfolios as well as the advanced method for the calculation of the regulatory capital requirement for operational risk. The application was extended to further portfolios in 2010 and it is not yet finally assessed by the regulator. SG Finans will in 2013 present updated models for the assessment of collateral and financed objects ( LGD models) based on recommendations from the regulatory authorities in France and Norway. The capital requirement and capital coverage for 2012 is calculated based on the Basel II capital directive s standard method for credit risk and the basic indicator approach for operational risk. Total risk-weighted assets were MNOK 23.676,4 at the end of 2012, and the regulatory capital requirement for credit risk was MNOK 1.894,1. The regulatory capital requirement for operational risk was MNOK 173,2. The company does not take market risk and the regulatory capital requirement for market risk was zero. The total capital requirement was therefore MNOK 2.067,3. The capital coverage is satisfactory compared to regulatory minimum requirements and the company s internal requirements and guidelines for solidity and capital adequacy. As part of the company s capital management procedures, stress testing of all relevant risks is performed and the change in the capital requirement under various stress scenarios is evaluated. The capital adequacy is considered satisfactory also considering the results of the performed stress tests. The capital buffer after performed stress tests and additional capital requirement (pillar 2 requirements) is MNOK 461,3 before allocation of the net result of the year, compared to MNOK 496,9 at the end of 2011. The net income after tax is MNOK 255,0 for the company. The Board proposes to pay a dividend of TNOK 420 based on the 2012 financial statements. The Board considers that the financial statements give a true and fair view of the company s financial position. Other than what is stated in the accounts there have not been any events after balance-sheet date that may have any significant impact on the financial statements. Based on the results of the year, the Board concludes that there are grounds for continuing operations, and this forms the basis for the preparation of the financial statements for 2012. CORPORATE GOVERNANCE SG Finans is a wholly owned subsidiary of Société Générale Group, and is subject to comprehensive reporting to and controls from the parent company. Furthermore, the company has established a number of functions to ensure good monitoring and control of the company development, use of resources and risk taking. The company takes credit risk through lending and financing of equipment, while other types of risk are hedged to the extent this is possible and practicable. The company s principles and guidelines for internal governance and internal control are based on a.o. CEBS guidelines and recommendations. It is established formal committees and procedures for monitoring and control, including control of credit risk, financial risks, operational risks as well as for internal control, compliance, antimoney laundering and audit. SG Finans thus complies with the internal requirements defined by the parent company, and the company also participates in relevant external forums to contribute to the development of rules and regulations for financing companies.

REPORT OF THE BOARD OF DIRECTORS 11 RISK MANAGEMENT The company s principles for risk management have been presented in more detail in note 17 Risk management. Since the second half of 2007 capital markets have been marked by financial crisis, lack of confidence and a sharp reduction in liquidity in the interbank market followed by an increase in funding costs and general increase in credit spreads. In 2012 interbank markets have been marked by uncertainty linked to the economic development of some EU countries. SG Finans AS gets its funding from the parent company and we have in the entire period maintained a close contact with our parent. In total we can conclude that the company has had access to satisfactory levels of funding and liquidity. As part of the group s measures to adapt to new capital regulation, SG Finans has adjusted the total volume of financed objects. This has lead to a reduction in outstanding loans during 2012. Another central element in the company s management of the financial crisis has been the possibility to incorporate increased cost of funding in the pricing of financing to clients. Furthermore, the company has in 2012 continuously adapted the maturity profile of funding to match maturities of lending in order to ensure stable long term funding and long term coverage of liquidity requirements. The company is subject to internal and external capital adequacy requirements. The internal guidelines compel the company always to comply with internal requirements which are stricter than the regulatory minimum requirements. As part of the company s policy and procedures for capital management the company regularly performs assessment of the capital situation and capital adequacy in given stress tests for various scenarios and relevant types of risk. This has been carried out in accordance with the regulatory requirements for internal processes for the assessment of capital adequacy (Internal Capital Adequacy Assessment Process or ICAAP). The analysis demonstrates that the company s capital adequacy and solidity is satisfactory in respect of expected future growth and also following the stress tests that have been performed. In 2007 and 2008 the company has implemented the central elements in Société Générale group s methods and procedures for operational risk management. As a part of this, the company has implemented monitoring and reporting of key risk indicators for operational risk and scenario analysis of different stress scenarios, in addition to the existing event and loss reporting and the group s framework for self-assessment of risks and controls. On an overall level, the Board assesses the level of operational risk losses in the company in 2012 as satisfactory. SG Finans has implemented the Société Générale group s requirements for the use of the advanced measurement approach (AMA according to the Basel II capital directive) for the calculation of the capital requirement for operational risk. The company has applied for the approval from regulatory authorities to use the AMA method in the calculation of capital adequacy and reporting to regulatory authorities and the public. The application is under assessment by Finanstilsynet. As part of Société Générale group, the company has worked in line with the group s principles and framework for internal control and corporate governance. Assessments are made of relevant risks and the efficiency of internal controls. The results of these assessments are considered satisfactory. ORGANISATION At the end of the year the company had 358 employees, whereof 285 in the Norwegian operations, 43 in Sweden and 30 in Denmark. The number of staff is thus reduced with 15 during the year. The reduction in number of staff comes from in-creased efficiency in operations and internal support processes. In 2012, the company has recruited 16 new employees. The Board welcomes all new employees joining SG Finans in 2011. SG Finans focuses on ensuring that its employees experience equal opportunities, and work designed to achieve this has been incorporated into the company s strategy plan. Furthermore, the company has established functions and procedures to prevent any form of discrimination. This includes the Remuneration and Recruitment Committee and the Work Environment Committee, whose members are equally staff representatives and company management, anonymous whistle-blower protection procedures for employees, periodic staff appraisal reviews as well as staff satisfaction surveys where any potential discrimination shall be identified and avoided. As an IA-company ( Including working environment ) SG Finans AS has in the plans for the company s IA-activities defined measures to avoid discrimination of employees with disabilities in new recruitments. The company facilities are adapted

12 REPORT OF THE BOARD OF DIRECTORS to employees with disabilities. Based on the above functions and measures the company procedures related to the law against discrimination and availability are considered satisfactory. ( diskriminerings- og tilgjengelighetsloven ) high degree of competence and experience and the organisation has both the capacity and will for adjustment and change. After a period of tight labour market and strong demand for employees with expertise in the finance sector, the turnover in 2012 is at a satisfactory level. The rate of absence due to illness is also slightly up compared to 2011, and is at an acceptable level with in total 4.079 absence days. This represents 4,17 % absence. The Board is not aware of any personal injuries occurred at work during 2012. The working environment at SG Finans is considered to be good. This was also confirmed in the company s staff satisfaction survey. The company has a Work Environment Committee and a Cooperation Committee. Legally required meetings have been held. Various cultural and expertise-building measures have been conducted in 2012, both at local (regional and branch) and central level. Emphasis has also been placed on continuing to build up a common Scandinavian culture while simultaneously promoting the advantages of being a part of one of Europe s largest banking groups to the company s employees. Being part of Société Générale group is also actively marketed in recruitment of new staff. Marie-Christine Ducholet Chairman Karin Cecile Kullmann Five Lysaker 7 March 2013 Tommy Pedersen Jacques Bensen FUTURE PROSPECTS The situation for the countries in southern Europe show signs of improvement at the end of 2012, but the uncertainty is still large. At the start of 2013 the economic outlook for Scandinavia is better than for the countries in southern Europe. Still we must expect high number of bankruptcies and thus credit losses above long-term average in 2013. For SG Finans AS the development in 2013 will largely follow the same development as the rest of the business. In particular the development of interest rates and funding costs for banks will be important to stimulate business investments and demand for financing of equipment. It is important for SG Finans that our clients and partners experience that the company has demonstrated willingness and ability to be a long-term partner for financing of capital goods and equipment. Our focus will continue to be to maintain and develop the good relations to our existing clients and partners and to develop new long-term relations. The organisation is well prepared to meet the challenges. The company has employees with a Jean-Marc Mignerey Kjell Vegard Opheim Carsten Thorne CEO

organisation 13 organisation SG Finans is a wholly owned company at the Société Générale Group. The company operates through fifteen regional offices in Norway, five in Sweden and two in Denmark. The companys head office is in Lysaker (near Oslo) and the total number of employees end 2012 is 358. SG Finans is a part of Société Générale Equipment Finance, a leading player in equipment leasing in Europe. Société Général has 160 000 employees and is represented in 77 countries. Vision and Values of SG Finans SG Finans wants to be seen as a leading Scandinavian player who creates values through teamwork and knowledge. The vision is based on the following core values: This vision is based on the following core values: Sales and relationshipfocus Knowledge Enthusiasm and team spirit Brands and image The core activities are equipment finance (leasing) and factoring. Brands are SG Equipment Finance and SG Factoring. At the company level the brand is SG Equipment Finance. SG Finans Organisation and management The business activities of SG Finans are organized into regions and branch officies with regions in Sweden and Denmark. Key corporate functions are: Credit, Finance, IT and HR together with the Departments and Sales- & Business Development Equipment (SOFE) and Factoring (SOFF). CEO Carsten Thorne Group coordinator Kjell Brevik Deputy to the CEO Hans Einar Herzog Credit Armand Taillandier HR/Personal Maria Ulla Credit Adviser Odd Sørensen Internal audit Carl Gunnar Lunde Finance Hans Einar Herzog IT Sverre Edin Region Oslo/Akershus Finn Mathisen/Jan Juliussen SOFE Finn Mathisen SOFF Jan Juliussen Sweden Anders Holmgren Region South Arne Hodnefjell Denmark Lars Rasmussen Region East Finn Kristiansen Region West Espen Brochmann Region North Stig-Are Eriksen

14 organisation Societe Generale Equipment Finance 2012 We, Societe Generale Equipment Finance, a European market leader, n 3 worldwide, have demonstrated that we can deliver high added value services, optimize use of scarce resources and achieve good business results in a complex environment. Leaseurope* has not yet released the European market figures for 2012 but, according to local European associations first impressions, the overall market trend shows a stabilisation or a slight decrease. The European leasing environment is complex, while some countries are performing well, others are facing difficulties. The situation of the equipment finance sector is also mixed outside Europe with good performance registered in the United States and Brazil, and a slow-down noticed in China. In this context, we, Societe Generale Equipment Finance, have been strengthening our leading position in our key markets thanks to the sound relationships built over the years with partners, while at the same time we ve been adapting our business mix and operating model and increasing external funding. In 2012, we generated a NBV of EUR 7,2bn, evenly spread across our main industry sectors, and the value of our end-managed assets reached more than EUR 22,3bn. We were recognised as the European Lessor of the Year and SME Champion of the Year at the Leasing Life Awards in November, in Barcelona, Spain. Our subsidiary, PEMA, which provides full-service truck and trailer rental in 9 European countries had a very successful year. With a fleet of more than 17,000 vehicles at the end of 2012, PEMA is one of Europe s leading commercial-vehicle rental companies. High demand in this sector resulted in a rise of about 10% in PEMA s number of vehicles rented at the end of the year. This corresponds to an all-time peak of 92% in the rental rate. In 2013, Societe Generale Equipment Finance, will continue to adapt its business activity to the new environment which will continue to be impacted by the reinforcement of regulations and financial constraints. We are a part of Societe Generale s Specialised Financial Services & Insurance division which brings together specialised businesses to meet the specific needs of corporate clients and individuals. The division s businesses offer life and non-life insurance products (Societe Generale Insurance), financing solutions for sales and professional equipment (Societe Generale Equipment Finance), a wide range of consumer credit solutions (Societe Generale Consumer Finance) and car fleet financing and management solutions (ALD Automotive). Present in 45 countries, the Specialized Financial Services & Insurance division is supported by the expertise of 27,000 employees. Societe Generale is the fifth largest European bank in terms of market capitalisation (EUR 22.1bn end 2012). The Group employs 160,000 people in 77 countries and reported in 2012 a Group Net Income of 774 MEUR. Societe Generale successfully continued with its transformation process in 2012, achieving all the objectives set at the beginning of the year. At the same time as carrying out a proactive portfolio disposal programme and business refocusing, the Group succeeded, in a turbulent economic environment, in maintaining a good level of activity in order to serve its customers and finance the economy. The Bank also significantly improved its financial solidity both in terms of capital and liquidity. On the strength of this momentum, the Group has secured its Basel 3 Core Tier 1 capital target of 9%-9.5% at end-2013 and is approaching this year of economic and regulatory transition with confidence. Societe Generale group is rated A2 by Moody s, A by S&P and A+ by Fitch. 2012 New Business Volumes per geography (%) France ** 30% Germany 26% 7% Italy 7% 15% 15% BRUC s * Scandinavia 15% Others Benelux Spain 5% 10% Alps & 12% SEE 16% Poland UK 30% 27% Czech Rep. & Slovakia *Leaseurope: European Federation of Leasing Company Associations market *BRUC s : Brazil, Russia, United States, China

organisation 15 SG finans Norway The Norwegian business in SG Finans AS is the backbone of the company. The company holds the leading market position in Norway in the product area Equipment Leasing, and the same applies to the company s market position in Ordinary Factoring. The total result for the Norwegian business in 2012 was one of the best since 2005. Cooperation with Norwegian and International vendors is still an important pillar for the company s further development. Customer satisfaction and supplier satisfaction is measured regularly and the company achieved very high scores in both areas during 2012. Leasing On the leasing product we have had, throughout the year, a strong focus on the NBI and the development of other revenue items than just the margin. In addition to good control of expenses and losses, Finn Mathisen these measures have contributed to increased revenues for the business. We also noted growth in the number of contracts and customers. The company sales staff has been in charge of direct customer relationships. This, in addition to a focus on local presence, is a major cause of the company s solid market position in Norway. We have also in 2012 invested heavily in increasing the use of vendor financing facilities based on the latest technology. and transportation, while agriculture in the last three years has been stable. We also noted growth in the number of contracts and customers throughout the year. The company s market share of lease financing in Norway for 2012 is 27.5%. That means the company has maintained its leading market position. Factoring SG Finans has long been the leading factoring company in the Ordinary Factoring segment in Norway with market shares beyond 40%. The reason lies in several factors: a decentralized Jan Juliussen organization where both marketing and operations are located in five regions that gives us a special insight into market conditions, and the fact that we also have centralized specialists to support the regions and customers. In addition we have excellent IT systems with web solutions, E-print and E-invoice amongst the other wide range of products. Since all factoring companies in the Société Générale Group have introduced the same factoring system, we can take advantage of the combined experience gained in the various countries. The competence of the regional factoring environments is essential to being a leader in the Norwegian factoring market. We have therefore developed a training concept (SG Factoring Academy) which will help to maintain competence in relation to the needs and requirements for the product area. From left: Finn Kristiansen, Stig-Are Eriksen, Arne Hodnefjell and Espen Brochmann. The market for leasing in Norway has since 2011 continued to grow. This applies to both construction Factoring Operations in SG Finance have over time been of great importance for the company. The development of systems, in addition to the experience of the Norwegian operations, will provide a good basis to expand factoring activities to SG branches in Sweden and Denmark.

16 organisation sg finans denmark 2012 was the best ever for our company in Denmark. Once again we showed positive development in the new issue of leases, increased further our market share and delivered strong growth in earnings. Growth rates in Denmark were modest in 2012, when the economy was still characterized by uncertainty and skepticism, which resulted in lower investment levels in businesses. The market for commercial leasing in SG Finans focus areas increased by approx. 2% compared to 2011. With growth in the new issue of leases of more than 10% in the same period, we increased our market share further in 2012. SG Finans Denmark has, during and after the crisis, maintained its focus on growth while establishing and developing strong relationships with suppliers. For 2012, the Group recorded sales growth that was the highest level in the branches history. The number of bankruptcies in Denmark remained in 2012 at the same high level as in 2011, when about. 5,000 companies had to close. Costs of losses and provisions for customers were reduced in 2012 and are at a satisfactory level. The increased business in SG Finans Denmark is based on our local presence and expertise, combined with a strong organizational and financial backing. Supplier, customer and employee satisfaction surveys in 2012 have been very positive and thus give a solid basis for further development. Lars Rasmussen SG Finans Denmark continues to be further strengthened and we will, by each employee living out our company core values - Sales and Relationship Focus, Enthusiasm and Team spirit, competence and knowledge - work to be perceived as the most attractive leasing company for customers suppliers and employees. On the basis of the increased business volume, good cost control and satisfactory loss development in Denmark, we are satisfied with our result, which is 65% higher than in 2011 and thus, again, the best ever result in SG Finans Denmark. Activities in Denmark have delivered a good return in line with the average result for SG Finans AS which is very satisfying. Our mission is to create value through collaboration and by offering a high level of service. We offer financing through dealers of fixed assets to businesses, where our financing solutions lead to increased sales from the supplier, but also to the wider business community s financing of machinery and fixed assets. It is therefore crucial that our partners and customers have a good experience when dealing with us and our services.

organisation 17 SG finans sweden In 2012, the total Swedish market grew by 21% and amounted to over SEK 51 billion. This is the highest figure in the last ten years with the exception of 2008 which was at the same level. Most of the increase came in Q4 (+38%) and mainly within the heavy trucks / trailers segment and production equipment segment and licenses. An increasing uncertainty and thus reduced investment appetite was noted at the end of the year. The number of bankruptcies increased by 7% compared with 2011. Due to the economic turmoil in the Euro countries and the introduction of new regulations such as Basel III, a decision was taken in the summer of 2012 to cut down on the rate of growth for 2013, and temporarily reduce the volume of business. Our total market share felt from 7% to 6% in 2012. An adaptation of business to these new conditions was carried out in the second half, which resulted in some cost savings, settlement where possible of any collaborations with low yields and a strong focus on increasing margins by including a higher portion of other income. Efforts to achieve a better credit quality in the loan portfolio have continued, and a number of older exposures with very uncertain values have been written down. Some major fraud suffered in the financial markets, also added to our losses. Loan losses, net of the write-downs of older commitment amounts were at a level slightly higher than 2011, which was in line with the increased number of bankruptcies in Sweden in 2012. Despite the special circumstances that have been in force since mid-2012, we have successfully managed to establish a number of new partnerships and develop existing ones. Staff turnover is a result of our conversion and was slightly higher this year than previously. Great emphasis is placed on continuing to develop our employees and leadership. Employee surveys, Supplier and Customer Surveys also show very good results in 2012, which can be explained by our local presence, talented employees and high activity levels. The work we have done in recent years, and especially towards the end of 2012, means that we are now strong and well-equipped to, despite financial turmoil in our world, deliver business value to our customers and suppliers and a good return to our shareholders. Anders Holmgren

18

ANNUAL ACCOUNTS 19 PROFIT AND LOSS ACCOUNT Amounts in NOK thousands NOTES 31.12.12 31.12.11 Total interest and similar income 3 1 709 120 1 760 530 Total interest and similar expenses 3-831 764-861 729 Net interest margin 877 356 898 802 Total commission and fees income 4 243 483 234 692 Total commission and fees expenses 4-128 552-127 887 Net fees income 114 931 106 805 Net gain on financial instruments at fair value 5-2 250-1 957 Net change in value and gains on foreign currency -27 140 Income on other activity 4 141 320 124 608 Net banking income 1 131 330 1 128 397 Payroll, fees and other staff costs 6,7-321 836-302 239 Other operating expenses 6-208 887-238 912 Gross operating proft 600 607 587 246 Net cost of risk 8-168 971-174 491 Operating profit 431 636 412 756 Taxes 9-176 656-139 331 Profit for the year 254 981 273 424 Other comprehensive income Exchange differences on translation of foreign operations -156-614 Other comprehensive income for the year. 254 825 272 810 Attributable to: Equity holder of the parent 254 825 272 810 Total comprehensive income of the year 254 825 272 810

20 ANNUAL ACCOUNTS Balance sheet Amounts in NOK thousands NOTES 31.12.12 31.12.11 Assets Cash and deposits with central banks 7 6 Deposits with financial institutions 13,21,22 691 944 630 726 Loans to financial institutions 21,22,25 2 989 349 2 903 992 Financial derivatives 10,14 3 846 21 931 Loans to customers Repayment loans 2 574 928 3 001 666 Factoring receivables 113 761 228 176 Factoring loans 1 615 146 1 602 361 Financial lease agreements 10,11 22 056 275 23 071 146 Total loans before allowances 26 360 110 27 903 349 Allowances on doubtful loans 8,19-199 199-236 712 Net loans to customers 18,21,22,23 26 160 911 27 666 637 Repossessed assets 20 67 788 108 722 Shares and primary capital certificates 1 317 320 Deferred tax assset 7 249 876 0 Other intangible assets 12 6 304 10 568 Machinery, tools and equipment, means of transport 12 13 002 13 981 Other assets 43 658 5 350 Prepayments and accrued income 12 850 11 266 Total assets 30 239 853 31 373 498

ANNUAL ACCOUNTS 21 Liabilities and equity Amounts in NOK thousands NOTES 31.12.12 31.12.11 Liabilities Loans and deposits from financial institutions with agreed maturity 15, 21, 22, 23, 25 24 997 556 26 333 717 Deposits from and debt to customers with termination rights 16,22 145 050 187 682 Financial derivatives 10,14 255 818 201 388 Retention of margin and other customer accounts 43 118 76 476 Other liabilities 16 714 914 790 449 Accruals and deferred income 156 268 214 571 Pension liabilities 7 22 990 18 742 Deferred tax liability 9 0 105 789 Current tax liability 9 451 064 246 433 Total liabilities 26 786 778 28 175 247 Equity Share capital 945 436 945 436 Share premium account 240 639 240 639 Other equity including profit for the year 2 267 000 2 012 176 Total equity 24 3 453 075 3 198 251 Total liabilities and equity 30 239 853 31 373 498 Contingent liabilities Guarantee liabilities 27,28 68 725 52 534 Lysaker 7 March 2013 Marie-Christine Ducholet Chairman Tommy Pedersen Board Member Jean-Marc Mignerey Board Member Kjell Vegard Opheim Staff representative Karin Cecile Kullmann Five Board Member Jacques Bensen Board Member Carsten Thorne Managing Director

22 ANNUAL ACCOUNTS CASH FLOW STATEMENT Amounts in NOK thousands 2012 2011 Operations Interest income 1 687 231 1 646 949 Interest costs -831 764-810 043 Other receipts 422 750 349 942 Operating expenses -723 730-617 577 Receipts on previous losses 33 774 29 135 Paid taxes -247 764-292 539 Net cash flow from operations 340 497 305 867 New investments leasing -8 782 356-9 514 507 Proceeds from sale of leasing 2 211 052 2 038 883 Decrease in loans ( net ) 7 772 877 7 001 253 ( Increase ) in other receivables -130 034 60 499 ( Increase ) in advance payments -1 584-126 Net cash flow from current financial activity 1 069 955-413 998 ( Increase) in tangible assets -333-10 009 Decrease of fixed assets 990 1 241 Net cash flow from investment activity 657-8 768 Increase (decrease) in deposits from customers -75 989-26 670 Payment of dividends 0-311 239 Payment of group contribution -281 576 Received group contribution 164 359 Currencyexchange without cash effect -156-614 Increase (decrease) in loans from credit institutions -1 263 646 390 945 Increase (decrease) in debt 103 008 202 096 Accrued costs 4 112-31 545 Net cash flow from long term financial activity -1 349 889 222 974 Net cash flow 61 220 106 074 Cash at the 1st of January 630 731 524 657 Cash at the 31st of December 691 951 630 731 Reconciliation cash, 31st of December Cash and deposits with central banks 7 6 Deposits with financial institutions 691 944 630 726 Cash at the 31st of December 691 951 630 731

ANNUAL ACCOUNTS 23 STATEMENT OF CHANGES IN EQUITY SG FINANS AS Share capital Share premium a/c Other equity Total Total equity 01.01.11 945 436 240 639 2 050 605 3 236 679 Profit for the year 272 810 272 810 Dividend -311 239-311 239 Total equity 31.12.11 945 436 240 639 2 012 176 3 198 251 Total equity 01.01.12 945 436 240 639 2 012 176 3 198 251 Profit for the year 254 825 254 825 Dividend 0 0 Group contribution given -202 735-202 735 Group contribution received 202 735 202 735 Total equity 31.12.12 945 436 240 639 2 267 001 3 453 075

24 ANNUAL ACCOUNTS notes to the accounts Note 1. ACCOUNTING PRINCIPLES 25 Note 2. IMPORTANT ACCOUNTING ESTIMATES AND DISCRETIONARY EVALUATION 30 Income statement Note 3. NET INTEREST MARGIN 31 Note 4. NET FEES AND INCOME ON OTHER ACTIVITY 31 Note 5. NET GAINS ON FINANCIAL INSTRUMENTS AT FAIR VALUE 31 Note 6. OPERATING EXPENSES 32 Note 7. PENSIONS 32 Note 8. LOSSES AND ALLOWANCES RECOGNISED IN THE PROFIT AND LOSS ACCOUNTS 36 Note 9. TAXES 36 Balance sheet Note 10. INFORMATION ON FAIR VALUE 38 Note 11. LEASING (FINANCIAL LEASING ASSETS) 40 Note 12. TANGIBLE FIXED ASSETS AND INTANGIBLE ASSETS 41 Note 13. RESTRICTED DEPOSITS 41 Note 14. FINANCIAL DERIVATIVES 42 Note 15. FUNDING / INTEREST EXPENSES 44 Note 16. OTHER LIABILITIES 44 Information on risk Note 17. RISK MANAGEMENT 45 Credit risk Note 18. RISK CLASSIFICATION 46 Note 19. DOUBTFUL LOANS 48 Note 20. REPOSSESSED ASSETS 48 Note 21. INTEREST RISK AND INTEREST RATE ADJUSTMENT PERIOD 49 Note 22. LIQUIDITY RISK AND REMAINING MATURITY ON BALANCE SHEET ITEMS 51 Note 23. NET POSITION PER CURRENCY 52 Additional information Note 24. OWNERSHIP 53 Note 25. INFORMATION ON RELATED PARTIES AND REMUNERATIONS 53 Note 26. CAPITAL ADEQUACY 55 Note 27. GUARANTEE LIABILITIES AND LOAN COMMITMENTS 56 Note 28. CONTINGENCIES 56 Note 29. NUMBER OF EMPLOYEES 56

ANNUAL ACCOUNTS 25 notes 1. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES Company information SG Finans AS is a Scandinavian finance company and its business is carried out through a broad, Scandinavian distribution network with 16 regional and sales offices in Norway, 5 offices in Sweden and 2 in Denmark. SG Finans AS forms part of Société Générale SA, a group listed on the stock exchange with head office in Paris, France. The Group consolidated financial statement is prepared by Société Générale SA, and is available on www.socgen.com. The company is a limited company incorporated and domiciled in Norway. Its registered office is in Strandveien 18, Lysaker. The financial statements for the year ended December 31st, 2012 were authorised for issue by board of directors and annual shareholders meeting on 7th March 2013. The basis of preparation of the financial statements SG Finans AS financial statements are prepared in accordance with International Financial Reporting Standards (IFRS), which have been approved by the E.U. The financial statements are set up on an historic cost basis, with the exception of the specific recognition criteria for financial instruments as described below. Branches and subsidiary company The financial statements show the figures for SG Finans AS ( the company ), i.e. the business operations in Norway and the branches in Denmark and Sweden. The financial statements are presented in Norwegian Kroner and all values are rounded to the nearest thousand Kroner, except when otherwise indicated. The branches in Denmark and Sweden are subject to a separate accounting treatment. The branch accounts are included in the company s accounts and notes. When translating foreign currency the mid-rate in effect as at 31.12 is used for all balance sheet items. Revenues and expenses are translated at the rate of exchange in effect at the time of the transaction. The subsidiaries DC Service AB and Klokkergårdsveien 32 AS has been exempted from consolidation as the company s profit before taxes and balance both represent less than 0.1 % of the profit and balance for SG Finans AS, as well as the criteria s in IAS 27.10 are met. Comparable figures Comparable figures are prepared for profit and loss, balance, cash flow statement and notes. The use of estimates The preparation of financial statements in accordance with IFRS includes assessments, estimates and assumptions that affect both which accounting principle is applied and the reported amounts for assets, liabilities, revenues and expenses. The actual amounts can vary from estimated figures. Estimates and underlying assumptions are reviewed and assessed on an ongoing basis. Changes in accounting estimates are applied in the period in which the estimates are changed, and in all future periods which are affected. Note 2 provide further information on significant estimates and assumptions. Assets and liabilities in foreign currencies Monies in foreign currencies in the balance sheet are translated at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the exchange rate in effect at the time of the transaction. Noncurrent and current liabilities are valued at face value. Accrual accounting for interest income, sales gains, commissions and fees Interests are carried at amortised cost in accordance with the effective interest rate method. Commissions received and paid, fees and other related amounts are included in the calculation of the effective interest rate. The expected maturity of the contracts is used as the basis for calculating the effective interest rate for loans, whereas the contractually fixed maturities in the agreements are used for financial leases. When contracts are terminated during the period, the outstanding balance is posted to the income statement as revenue or expense. Loans, loans that are in default or at risk of default and individual/group write-downs Loans are valued at amortised cost with the exception of loans that are at risk of default or in default where there are objective indications of impairment in value. Objective evidence of impairment for credit risk on loans includes significant financial problems at the debtor, defaulted payments or other material breaches of contract, instances where it is considered probable that the debtor will initiate debt settlement negotiations or other specific circumstances that have occurred. Write-downs will be made if objective evidence if a decline in value can be identified.

26 ANNUAL ACCOUNTS If there is objective evidence that an impairment in value has occurred, the loss is measured as the difference between the asset s value in the balance sheet and the net present value of estimated future cash flows (excluding future credit losses which have not occurred), discounted with the financial asset s original effective interest rate (i.e. the effective interest rate calculated at inception). The asset s balance sheet is reduced using a separate provision account. The loss amount is included in the Profit and Loss statement. Loans are defined as being in default when the delay in payment exceeds 90 days and the delay is not due to accidental circumstances at the customer. If a customer has several contracts, but only one is in default, the entire customer engagement is reported as being in default. Loans that are at risk of default are not necessarily in default, however the customer s financial standing and the value of the securities indicate a risk of default. The recovery of loans in default takes place with a new assessment when the applicable payment plans have been followed for a period of time and the loan is no longer deemed to be at risk of default. Write-downs for credit losses are made for loans on an individual basis. In accordance with the group s guidelines and documentation requirements for write-downs on group s of assets, we have not written down groups of loans. Losses that have been incurred but not reported (IBNR write-downs) have not been written down. When the company collects assets for realisation of a security interest or sells leased objects, and this is due to customer default, the lease object is classified as a repossessed asset and temporarily valued at the assumed net realisable value. Actual losses on realisation are recorded to losses on loans in the income statement. Financial assets When financial assets and liabilities are first entered into the accounts, they are classified in one of the following categories for the purposes of assessing value: Loans and receivables Fair value with changes in value through profit or loss ( trading ) Other liabilities Loans and receivables This category includes financial leases and loans that are not listed in an active market and are not defined as assets valued at fair value with changes in value recognised in the income statement. The classification also includes loan factoring, receivables factoring and loans to the parent company. This group is carried at amortised cost. Fair value with changes in value recognised in the income statement The classification includes derivates that cannot be classified as hedging instruments. Interest income and expenses are recorded directly into the accounts. See separate note on hedging Other financial obligations The classification includes borrowings from the parent company and is recorded at amortised cost. Hedging, foreign currency and interest rate instruments Hedging the interest rate risk from fixed interest rate contracts is implemented through swap contracts where we pay fixed and receive variable interest. This enables us to hedge our financial risk against changes in interest rates, and the loans outstanding match the funding. In compliance with IAS 39 changes in the market value of the fixed interest rate portfolio to fair value are measured and presented as part of the loan and market value of the hedging instruments for accounting purposes in line with financial derivatives. The net difference is recorded in Net gains on financial instruments at fair value. The connection is verified in the form of quarterly tests of the effectiveness of the hedge. A hedging efficiency of 80-125 % is expected. The hedge accounting is discontinued if it does not meet the above mentioned hedge requirements, the hedging instrument expires or is terminated, exercised or sold, or the company chooses to discontinue hedge accounting. Interest rate swaps that do not qualify as hedging instruments are classified as trading and presented in the balance sheet in the line item for financial derivates and changes in value are included in Net gains on financial instruments at fair value. Currency risk is managed by borrowing in the same currency and with the same maturity as assets in the foreign currency. The net result from the contracts in foreign currencies is exchanged into NOK or other local currency on realisation.

ANNUAL ACCOUNTS 27 Valuation of financial instruments Financial instruments are included in the balance sheet at fair value at the date of trade. On subsequent measurement the value in the accounts of financial instruments as defined above is set to either fair value or amortised cost. Refer to Note 10 for further information about fair value. Leasing SG Finans leasing activities comprise financial lease agreements. Financial leasing is classified as leasing and for accounting purposes is treated as loans. Contracts with residual value are written off to the residual value over the duration of the contract. The interest component of the lease payments is recorded as interest income in accordance with the principles described in the point for loans, while the principal component reduces the lease loan. Revenue from lease payment is recorded in accordance with the annuity principle. For tax purposes, the leasing objects are depreciated using the declining balance method. Direct marginal revenues and costs when first calculated and the expected gains on sale are included in net interest income. Other leasing gains on sale are posted under other revenues. Factoring Factoring is recorded in accordance with the net method, i.e. the loan to the user of the factoring service is recorded in the balance sheet. This loan is classified as loan factoring. If SG Finans has assumed the credit risk for the receivables then this loan is classified as receivables factoring. Retention of margin and other customer accounts is classified as such when prepayment to customer is lower than factoring receivables. Pension obligations Pensions are recorded in accordance with IAS 19 Employee Benefits. A distinction is made between insured and uninsured schemes. From 31st of December 2009, the benefit plan in Norway is replaced with a defined contribution schemes. The Swedish and Danish branches only operate defined contribution schemes. The pension calculations are undertaken by actuaries on the basis of assumptions that can change in the future. Actuarial gains and losses as a consequence of changes in assumptions or differences between expected and actual returns on pension plan assets are not directly recognised in the balance sheet, instead they are accrued over the expected contribution time of total participants if the total amount exceeds 10 % of the greater of total pension obligations or pension funds in the previous year. Refer to note 7. Deferred taxes Deferred taxes / tax benefit is calculated based on temporary differences between the accounting and tax values at the end of the financial year. Tax rate of 28 % is used in the calculations. Deferred tax are recognised at their nominal value and classified as long-term liabilities in the balance sheet. Equity securities Equities held are securities in the subsidiary company DC Service AB and Klokkergårdsveien 32 AS. The cost method is used in the company accounts. Provisions Provisions are recorded when the company has an obligation (legally or self-imposed) relating to a prior event, it is probable (more probable than not) that a financial settlement will take place as a result of the obligation and the actual amount can be reliably measured. Intangible assets Capitalised software is recorded as an intangible asset and depreciated using the straight line method based on the estimated lifetime, 3-7 years, from when the software is operational. Capitalisation occurs when the circumstances in accordance with IAS 38 have been met. The costs associated with maintaining the economic value of IT systems are expensed directly. Property, plant and equipment Tangible assets are valued at their cost less accumulated depreciation and impairment losses. When assets are sold or disposed of, the carrying amount is derecognised and any gain or loss is recognised in the statement of comprehensive income. The cost of tangible non-current assets is the purchase price, including taxes/duties and costs directly linked to preparing the asset ready for its intended use. Costs incurred after the asset is in use, such as regular maintenance costs, are recognised in the statement of comprehensive income, while other costs that are expected to provide future financial benefits are capitalized Depreciation is calculated using the straight-line method over the useful life spanning from 3 to 10 years. Changes in accounting policies and disclosures The accounting policies adopted are consistent with those of the previous financial year, except for the following amendments to IFRS effective as of January 1st, 2012:

28 ANNUAL ACCOUNTS IFRS 7 Financial Instruments Disclosure: The amendments lead to extended disclosure requirements for financial assets that have been transferred where the company is continuing involvement in the transferred assets to enable users of its financial statements to understand the relationship between transferred financial assets that are not derecognised in their entirety and the associated liabilities; and to evaluate the nature of, and risks associated with, the entity s continuing involvement in derecognised financial assets. New/amended/ additions to standards and interpretations. The disclosure consists of standards and interpretations that are made public before the publication of the annual report. The list below also includes amendments to existing standards/interpretations and new standards/ interpretations where the effective date according to IASB has passed, but is not yet approved by EU and may therefore not be implemented.] IFRSs and IFRICs issued but not yet effective The standards and interpretations that are issued, but not yet effective, up to the date of issuance of the company s financial statements are disclosed below. The company s intends to adopt these standards, if applicable, when they become effective, provided that the amendments are EU endorsed before publication of the annual report. IAS 1 Presentation of Financial Statements The amendments to IAS 1 change the grouping of items presented in other comprehensive income (OCI). Items that could be reclassified to profit or loss at a future point in time (for example, net gain on hedge of net investment, exchange differences on translation of foreign operations, net movement on cash flow hedges and net loss or gain on available -for-sale financial assets) would be presented separately from items that will never be reclassified (for example, actuarial gains and losses on defined benefit plans). The amendment affects presentation only and has no impact on the company s financial position or performance. The amendment becomes effective for annual periods beginning on or after July 1st, 2012, and will therefore be applied in the company s first annual report after becoming effective. IAS 12 Income Taxes The amendments in IAS 12 imply that deferred tax related to an investment property measured at fair value in accordance to IAS 40 Investment Property. The amendment clarified the determination of deferred tax on investment property measured at fair value in accordance with IAS 40 should be determined on the basis that its carrying amount will be recovered through sale (and not use). The expectation can be confuted if two given exceptions are present. The amendments also include an incorporation of SIC 21- Income Taxes - Recovery of Revalued - Non- Depreciable Assets stating that if a deferred tax liability or deferred tax asset arises from a nondepreciable asset measured using the revaluation model in IAS 16 Property, Plant and Equipment, the measurement of the deferred tax liability or deferred tax asset shall reflect the tax consequences of recovering the carrying amount of the non-depreciable asset through sale. The amendments become effective for financial statements starting on or later than January 1st, 2013 within the EU/EEA region. IAS 19 Employee Benefits The IASB has issued numerous amendments to IAS 19. These range from fundamental changes such as removing the corridor mechanism and the concept of expected returns on plan assets to simple clarifications and re-wording. The removal of the corridor mechanism implies that actuarial gains and losses shall be recognized in other comprehensive income in the current period. The amended standard will impact the net benefit expense as the expected return on plan assets will be calculated using the same interest rate as applied for the purpose of discounting the benefit obligation. The amendment becomes effective for annual periods beginning on or after January 1st, 2013. It is expected that this implementation will have effect on the financial statement. Further information can be found in note 7 to the financial statements. IAS 28 Investment in Associates and Joint Ventures As a consequence of the new IFRS 11 Joint Arrangements, and IFRS 12 Disclosure of Interests in Other Entities, IAS 28 Investments in Associates, has been renamed IAS 28 Investments in Associates and Joint Ventures, and describes the application of the equity method to investments in joint ventures in addition to associates. The amendments become effective for financial statements starting on or later than January 1st, 2014 within the EU/EEA region. IAS 32 Financial Instruments Presentation These amendments in IAS 32 clarify the meaning of currently has a legally enforceable right to set-off. The amendments also clarify the application of the IAS 32 offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. These amendments become effective for annual periods beginning on or after January 1st, 2014.

ANNUAL ACCOUNTS 29 IFRS 7 Financial Instruments Disclosure These amendments require an entity to disclose information about rights to set-off and related arrangements (e.g., collateral agreements). The disclosures would provide users with information that is useful in evaluating the effect of netting arrangements on an entity s financial position. The new disclosures are required for all recognised financial instruments that are set off in accordance with IAS 32 Financial Instruments: Presentation. The disclosures also apply to recognised financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set off in accordance with IAS 32. These amendments will not impact the company s financial position or performance and become effective for annual periods beginning on or after January 1st, 2013. IFRS 9 Financial Instruments IFRS 9, as issued, reflects the first phase of the IASB s work on the replacement of IAS 39 and applies to classification and measurement of financial assets and financial liabilities as defined in IAS 39. The standard was initially effective for annual periods beginning on or after January 1st, 2013, but Amendments to IFRS 9 Mandatory Effective Date of IFRS 9 and Transition Disclosures, issued in December 2011, moved the mandatory effective date to 1 January 2015. In subsequent phases, hedge accounting and impairment of financial assets will be addressed. The Company will quantify the effect in conjunction with the other phases, when the final standard including all phases is issued. IFRS 10 Consolidated Financial Statements, IAS 27 Separate Financial Statements IFRS 10 replaces the portion of IAS 27 Consolidated and Separate Financial Statements that addresses the accounting for consolidated financial statements. It also addresses the issues raised in SIC-12 Consolidation - Special Purpose Entities. IFRS 10 establishes a single control model that applies to all entities including special purpose entities. The changes introduced by IFRS 10 will require management to exercise significant judgment to determine which entities are controlled and therefore are required to be consolidated by a parent. The company s has evaluated which entities that are required to be consolidated in accordance to IFRS 10 and made a comparison with the current requirements in IAS 27. IFRS 10 has revised the definition of control compared to IAS 27. Entities the investor controls are required to be consolidated in accordance to IFRS 10. An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The amendments become effective for financial statements starting on or later than January 1st, 2014 within the EU/EEA region. Amendments in IFRS 10, IAS 27 and IFRS 12 related to Investment Entities Entities meeting the definition of an Investment Entity are no longer required to consolidate its subsidiaries in accordance to the amendments in IFRS 10, with one exception, if an investment entity has a subsidiary that provides services that relate to the investment entity s investment activities, it shall consolidate that subsidiary. Remaining investments in subsidiaries, joint ventures or associates shall be measured at fair value through profit or loss. Investments entities that are required to recognize its subsidiaries at fair value through profit and loss in accordance with IFRS 10 presents separate financial statements as its only financial statements. The disclosure requirements are extended. The amendments become effective for annual periods beginning on or after 1 January 2014; however the amendments have not yet been endorsed by the EU. IFRS 12 Disclosure of Interests in Other Entities IFRS 12 includes all of the disclosures that were previously in IAS 27 related to consolidated financial statements, as well as all of the disclosures that were previously included in IAS 31 and IAS 28. These disclosures relate to an entity s interests in subsidiaries, joint arrangements, associates and structured entities. A number of new disclosures are also required, but has no impact on the company s financial position or performance. The amendments become effective for financial statements starting on or later than January 1st, 2014 within the EU/EEA region. IFRS 13 Fair Value Measurement IFRS 13 establishes a single source of guidance under IFRS for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. IFRS 13 becomes effective for annual periods beginning on or after January 1st, 2013. Annual improvements 2009-2011 IAS 1 Presentation of Financial Statements This improvement clarifies the difference between voluntary additional comparative information and the minimum required comparative information. Generally, the minimum required comparative information is the previous period.

30 ANNUAL ACCOUNTS These amendments will not impact the Group s financial position or performance and become effective for annual periods beginning on or after January 1st, 2013; however the amendments have not yet been endorsed by the EU. IAS 16 Property, Plant and Equipment This improvement clarifies that major spare parts and servicing equipment that meet the definition of property, plant and equipment are not inventory. The amendments become effective for annual periods beginning on or after 1 January 2013; however the amendments have not yet been endorsed by the EU. IAS 32 Financial Instruments - Presentation This improvement clarifies that income taxes arising from distributions to equity holders are accounted for in accordance with IAS 12 Income Taxes. The amendments become effective for annual periods beginning on or after January 1st, 2013; however the amendments have not yet been endorsed by the EU. SG Finans do not expect, except where this is specifically accounted for, that the implementation of changes /new accounting standards presented above will have a material effect on the company s financial statement. 2. IMPORTANT ACCOUNTING ESTIMATES AND DISCRETIONARY EVALUATIONS The preparation of annual financial statements in conformity with generally accepted accounting principles requires that occasionally management must make estimates and assumptions. Estimates and discretionary evaluations are regularly assessed and are based on historic experience and other factors, including the expectations of future events that are considered to be probable under the current circumstances. The company prepares estimates and makes presumptions and assumptions connected to the future. The accounting estimates that are based on this will seldom be entirely in accordance with the final outcome. Some accounting principles are considered to be especially important to enlighten the company s financial position because they require the management to make difficult or subjective assessments and determine estimates that are, for the most part, uncertain at the time the estimates are made. Further information on these types of assessments and estimates is provided below. Loan write-downs When evaluating the need for write-downs the most important assessment is related to estimating the most probable future cash flows from the customer. In principle, all cash flows from the loan shall be identified, and an evaluation must be made as to which cash flows are deferred. With the large number of loans which are subject to assessment, these types of calculations must be made based on approximations and experience. For further information about the procedure used for the write-downs, refer to Note 1 Accounting principles. Expected sales gain As part of the equipment leasing activity, SG Finans may obtain sales gains from disposal of leased assets. Based on historic observations, tendencies and development in the second-hand market, estimated sales gains from disposal of leased assets further to the contract coming to end of term are included in interest income, see also note 1. Repossessed assets Assets which are repossessed further to the clients default are transferred as to Repossessed Assets based on expected market value, hence reflecting expected impairment of the objects. Pension obligations The present value of pension obligations is calculated by an external actuary (Watson Wyatt), which bases its assessments on demographic assumptions about the population. A number of actuarial and financial parameters are used in the calculations. The most important financial parameter is the discount rate which is determined based on the interest rate on government bonds with an obligatory duration margin at the balance sheet date, and an addition to take account of the relevant maturity of the obligations. The expected return on pension plan assets is determined based on how the plan assets are invested and from historical returns. Other fundamental assumptions for the pension plan obligations are the annual rate of salary increase, the annual regulation of pensions, the expected G regulation (a base amount annually approved by the Norwegian parliament) and the withdrawal propensity in respect of the early retirement scheme. These are based on the recommendations from The Norwegian Accounting Standards Board (NASB) and the management s expectations. Refer to note 7 and note 1. Contingencies Within the scope of its ordinary operations SG Finans AS will be regularly involved in legal disputes. Any effects on the financial statements are assessed on a case by case basis. Refer to Note 28.

ANNUAL ACCOUNTS 31 3. NET INTEREST MARGIN Amounts in NOK thousands 2012 2011 Interest income fra financial institutions, valued at amortised cost 136 352 138 807 Interest income from customers financial leases and loans, valued at amortised cost 1 572 763 1 621 667 Other interest income 6 55 Total interest income 1 709 120 1 760 530 Interest expenses to financial institutions, valued at amortised cost -824 229-854 994 Interest expenses on deposits and debt to customers, value at amortised cost -3 505-4 080 Other interest expenses -4 030-2 655 Total interest expenses -831 764-861 729 Net interest margin 877 356 898 802 4. NET FEES AND INCOME ON OTHER ACTIVITY Amounts in NOK thousand 2012 2011 Commission and fees income from loans and similar to customers 243 483 235 354 Other commission and fees income 0-662 Commission and fees income 243 483 234 692 Commission and fees expenses from loans and similar to customers -126 974-126 293 Other commission and fees expenses -1 578-1 593 Commission and fees expenses -128 552-127 887 Net commission and fees income 114 931 106 805 Sales gains 101 089 88 628 Income from extension of leasing contracts 42 989 33 095 Other income -2 758 2 885 Total income other activity 141 320 124 608 5. NET GAINS ON FINANCIAL INSTRUMENTS AT FAIR VALUE Amounts in NOK thousand 2012 2011 Net gains on financial derivatives, trading -1 192-2 601 Change in fair value on financial derivatives, hedging 6 009-25 197 Change in fair value on hedged fixed interest loans -7 068 25 842 Net gains on financial instruments at fair value through P&L -2 250-1 957

32 ANNUAL ACCOUNTS 6. OPERATING EXPENSES Amounts in NOK thousand 2 012 2011 Payroll 231 500 219 282 Pensions 30 291 23 003 Social security costs 60 045 59 954 Total payroll, fees and other staff costs 321 836 302 239 Administrative expenses 91 672 109 986 Rent and other operating expenses on leased property 27 155 25 710 Other operating expenses 27 937 33 027 Intergroup services 51 940 57 909 Ordinary depreciation 10 182 12 279 Total other operating expenses 208 887 238 912 Total operating expenses 530 723 541 151 Employee share ownership program Employees were in 2012 offered to participate in the global employee share ownership program of Société Générale SA. SG Finans contributed to the purchase, limited to 1.000 Euro for each employee. Expenditure for this contribution has been classified as payroll, fees and other staff costs." Fees paid to Ernst & Young AS and cooperating companies are made up as follows (excl VAT): Amounts in NOK thousand 2012 Statutory audit 799 Other attestation services Tax advice 43 Other non-audit services Total 842 7. PENSIONS SG Finans is obligated to follow the Act on Mandatory company pensions. The company s pension scheme follows the requirement as included in the Act. SG Finans AS have defined contribution plans for employees in Norway, Sweden and Denmark. The contributions comprise between 4,5 % and 11 % of salaries. As at December 31st, 2012, 358 members were covered by the plans. Employees in Norway can also apply for an early retirement pension (AFP) at 62 years of age. The agreement also covers invalidity pension, spouse s pension and children s pension. There are also pension obligations to individual employees over and above the ordinary collective agreement. This applies to employees with a lower retirement age and employees with salary in excess of 12 G (G = National Insurance basic amount), which are unfunded. The economic assumptions used in the collective scheme are specified below. Contributions to the AFP plan are included in the column unfunded.

ANNUAL ACCOUNTS 33 The former multi-employer plan called AFP was terminated in February 2010 and the last chance of an early retirement in accordance with the old plan was December 31st, 2010 The profit from the termination has been accounted for in 2010 and is presented as a reduction of salary and personnel costs. A remaining accrual exists and is related to deductibles for employees that have performed an early retirement according to the old plan. When terminating the old AFP-plan it became apparent that there was a significant deficit in the plan. The deficit must be carried by the participating companies through continuous payments of contribution in the next coming 5 years. The company s share of this deficit has been estimated and accrued for in the financial statement. 62 years, in addition to working, and it will continue accruing if working until the age of 67 years. The new AFP-plan is a defined benefit multi-company plan which is financed through contributions that are determined by a percentage of the employee s earnings. There is currently no reliable measure and allocation of liabilities and assets in the plan. The plan is accounted for as a defined contribution plan where no accruals are made and the contributions are accounted for as they occur. Contributions are paid first in 2011. For 2012 the contribution is has been set to 1,75 % of the total payments between 1 G and 7,1 G to the employees. The plan will be unfunded and it is expected that the level of contribution will increase in the following years. As a replacement of the old AFP-plan a new AFPplan has been established. The new AFP-plan is in the contrary to the old, not an early retirement plan, but a plan that gives a lifelong contribution to the ordinary pension. The employees can choose to exercise the new AFP plan starting at the age of Economic assumptions: Percentage 2012 2011 Discount rate: 2,00 % 2,80 % Expected return on assets 0,00 % 0,00 % Growth in salary 4,00 % 4,00 % Inflation 2,50 % 2,50 % G - regulation 3,75 % 3,75 % Growth in current pensions 3,75 % 3,75 % Withdrawal tendency AFP 0 % 0 % Pensions costs : Amounts in NOK thousand Funded Unfunded Total 2012 Funded Unfunded Total 2011 Present value of pensions earned during the year 0 1 487 1 487 0 990 990 Interest cost of accrued pension liabilities 0 750 750 0 811 811 Expected return on plan assets 0 0 0 0 0 0 Plan change, curtailments 0 2 744 2 744 0 133 133 Difference between actual and estimated values 0 742 742 0 1 318 1 318 Net pension costs 0 5 723 5 723 0 3 252 3 252

34 ANNUAL ACCOUNTS Pension cost for 2012 amount to TNOK 5 723 from the defined benefit plans and TNOK24 567 from the contribution plans, and the total amounts to TNOK 30 290. Pension cost for 2011 amount to TNOK 3 252 from the defined benefit plans and TNOK 19 751 from the contribution plans. In total TNOK 23 003 is recorded for in 2011. Pension liabilities in balance sheet Amounts in NOK thousand Unfunded Total 2011 Funded Unfunded Total 2012 Plan assets at market value 0 0 0 0 0 Estimated pension liabilities 33 396 33 396 0 28 319 28 319 Net pension liability 33 396 33 396 0 28 319 28 319 Actuarial gains (-)/losses -13 621-13 621 0-10 048-10 048 Plan change, curtailment 1 147 1 147 0-1 597-1 597 Settlement 0 0 0 0 0 Recognised pension liability 20 923 20 923 0 16 674 16 674 The company's share of the deficit related to the old AFP has been estimated and accrued for. The accrual is presented as a pension liability. The total pension liability is TNOK 22 990 at year end 2012. Pension liability: The elimination of the corridor method mean that actuarial gains and losses must be recognised in other comprehensive income (OCI) in the period incurred. The company will implement the new standards as of January 1st, 2013. Following the changes, an effect of TNOK 15 083 is estimated as shown by the tables below. The effect will be recognised in other comprehensive income January 1st, 2013. Amounts in NOK thousand 2012 2011 2010 2009 2008 Opening balance 28 319 23 570 47 642 260 735 174 026 Total service cost 1 487 990 1 260 25 359 15 962 Interest cost 750 811 1 047 12 554 10 674 Payments from internal book -1 474-1 850-2 302-4 241-3 676 Payments from plan assets 2 611 0-28 906 0 0 Settlement, curtailment 0-79 -808-135 706 0 Actuarial gains/(loss) 4 314 4 876 5 637-111 059 63 748 Ending balance 36 007 28 319 23 570 47 642 260 735 Actuarial gain/(loss) -15 083-11 645-8 252-6 264-86 362 Plan assets Amounts in NOK thousand 2012 2011 2010 2009 2008 Opening balance 0 0 0 106 291 109 165 Expected return on plan assets 0 0 0 5 296 5 444 Employee contributions 0 0 0 24 118 17 748 Payment from plan assets 0 0 0 0 0 Settlement, curtailment 0 0 0-135 706 0 Actuarial gain/(loss) 0 0 0 0-26 066 Ending balance 0 0 0 0 106 291

ANNUAL ACCOUNTS 35 Historical disclosure information Amounts in NOK thousand 2012 2011 2010 2009 2008 Gross pension liability 31.12 36 007 28 319 23 570 47 642 260 735 Plan assets, fair value 31.12 0 0 0 0 106 291 Net pension liability 36 007 28 319 23 570 47 642 154 444 Actuarial gain/(loss) -15 083-11 645-8 252-6 264-86 362 Experience adjustment expressed as percentage of plan liability Experience adjustment expressed as percentage of plan asset 0,0 % 18,4 % 0,0 % -9,9 % 2,2 % 0,0 % 0,0 % 0,0 % 0,0 % 24,5 % Plan asset information Percentage 2012 2011 2010 2009 2008 Cash 0 % 0 % 0 % 0 % 12 % Equity 0 % 0 % 0 % 0 % 6 % Bond 0 % 0 % 0 % 0 % 61 % Real estate 0 % 0 % 0 % 0 % 17 % Other 0 % 0 % 0 % 0 % 4 % Total 0 % 0 % 0 % 0 % 100 % Return on asset Percentage 2012 2011 2010 2009 2008 Booked 0 % 0 % 0,00 % 4,80 % 2,20 % Value adjusted 0 % 0 % 0,00 % 5,50 % 0,50 %

36 ANNUAL ACCOUNTS 8. LOSSES AND ALLOWANCES RECOGNISED IN THE PROFIT AND LOSS ACCOUNTS Amounts in NOK thousand 2 012 2011 Allowances on doubtful loans Allowances on doubtful loans as of 01.01 236 712 260 554 - Exchange rate adjustments (opening balance) 3 067 0 - Actual losses that are covered by previous allowances 109 764 95 437 - Reclassification of previous allowances 42 910 58 453 + Allowances on doubtful loans in the period 118 228 130 048 = Allowances on doubtful loans 31.12 199 199 236 712 Losses on loans Write-downs for loan losses as at 31.12 199 199 236 712 + Exchange rate adjustment (opening balance) 1 724 1 672 - Write-downs for loan losses as at 01.01 236 712 260 554 + Total actual losses 238 534 225 796 - Income on actual losses 33 774 29 135 = Losses on loans 168 971 174 491 9. TAXES Amounts in NOK thousand 2 012 2011 Taxes payable are made up as follows: Profit on ordinary activities before tax expense 431 636 412 756 Permanent differences 194 524 94 428 Change in temporary differences prior year 0 10 477 Change in temporary differences 984 783 644 032 Basis for taxes payable 1 610 943 1 161 693 Taxes payable on profit for the year 451 064 325 274 Tax on group contribution 0-78 841 Current tax 451 064 246 433 In 2012 TNOK 167 212 of the permanent differences is related to recognition of the operation of the company s branches in Sweden and Denmark. Equivalent in 2011 totaled TNOK 15 323. The tax expense for the year is made up as follows: Taxes payable on profit for the year 451 064 325 274 Too much allocated prior years 1 331-2 680 Gross change in deferred tax -275 739-183 262 Total tax expense for the year 176 656 139 331

ANNUAL ACCOUNTS 37 Specification of basis for deferred tax/deferred tax assets 31.12.2012 31.12.2011 Differences to be offset: Financial leasing assets -906 158 68 419 Gain and loss account 8 239 24 246 Net pension liability -22 990-18 742 Financial instruments 1 080-71 Accounting allowances 34 582 25 684 Total basis, change in temporary differences -885 247 99 536 Differences not included in the calculation of deferred tax -2007-922 Deferred tax (+) / Deferred tax asset (-) -249 876 26 948 At the end of 2012 recorded net deferred tax asset for the company amounted to TNOK 249 876, compared to a deferred tax liability in 2011 with TNOK 26 948. Reconciliation from nominal to actual tax rate 2012 2011 Net profit before taxes 431 636 412 756 Expected income tax with nominal tax rates (28%) 120 858 115 572 The tax effect of following items ; Not deductible costs 54 467 26 440 Other entries related to allowances previous years 1 331-2 680 Tax expense 176 656 139 331 Effective tax rate 40,9 % 33,8 %

38 ANNUAL ACCOUNTS 10. INFORMATION ON FAIR VALUE Method to calculate fair value of financial instruments Regarding financial instruments recorded at fair value, see description in note 1 Accounting Principles. Lending (loans and financial leasing) to and receivables on customers The pricing of lending (loans and financial leasing) is based on market prices. Stipulated prices include additions to cover credit risk. The value of impaired engagements is determined by discounting expected future cash flows. We therefore assess that the recorded value is a fair estimate of fair value for loans and receivables valued at amortised cost. Loans from financial institutions and deposits from customers Fair value is determined to be equal recorded value for loans from financial institutions and deposits from customers valued at amortised cost. Amounts in NOK thousand 31.12.12 31.12.11 Book value Amortised cost Fair value Book value Amortised cost Fair value Financial assets Cash and deposits with central banks 7 7 7 6 6 6 Deposits with financial institutions 691 944 691 944 691 944 630 726 630 726 630 726 Loans to financial institutions 2 989 349 2 989 349 3 173 457 2 903 992 2 903 992 3 026 161 Financial derivatives 3 846 0 3 846 21 931 0 21 931 Net loans to customers 26 160 911 26 030 046 26 160 911 27 666 637 27 527 166 27 666 637 Total assets 29 846 057 29 711 346 30 030 165 31 223 292 31 061 890 31 345 461 Financial liabilities Loans and deposits from financial institutions with agreed maturity Deposits from and debt to customers with termination rights 24 997 556 24 997 556 24 997 556 26 333 717 26 333 717 26 333 717 145 050 145 050 145 050 187 682 187 682 187 682 Financial derivatives 255 818 0 255 818 201 388 0 201 388 Retention of margin and other customer accounts 43 118 43 118 43 118 76 476 76 476 76 476 Total liabilities 25 441 542 25 185 724 25 441 542 26 799 263 26 597 874 26 799 263

ANNUAL ACCOUNTS 39 SG Finans uses the following hierarchy related to determining and disclosing the fair value of financial instruments: 1) Quoted (unadjusted) prices in active markeds for identical assets or liabilities (level 1) 2) Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly (level 2) 3) Techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data (level 3) Amounts in NOK thousand 31.12.12 31.12.11 Financial liabilities level 1 level 2 level 3 level 1 level 2 level 3 Financial derivatives 3 846 0 0 2 1 931 0 0 Financial lease agreements 0 2 284 120 0 0 2 626 592 0 Total assets 3 846 2 284 120 0 2 1931 2 626 592 0 Financial liabilities Financial derivatives 255 818 0 0 201 388 0 0 Total liabilities 255 818 0 0 201 388 0 0

40 ANNUAL ACCOUNTS 11. LEASING (FINANCIAL LEASING ASSETS) Amounts in NOK thousand 2 012 2011 Purchase costs 01.01 42 633 426 40 686 760 Exchange rate difference (opening balance) -271 330-23 762 Inflow during the year 8 782 356 9 514 507 Outflow during the year 8 862 317 7 544 080 Purchase costs 31.12 42 282 135 42 633 426 Accumulated ordinary depreciation 01.01 18 286 898 16 642 084 Exchange rate difference 01.01-97 800-7 735 Ordinary depreciation during the year 7 316 235 7 153 531 Reversed depreciation sold assets 6 677 510 5 500 983 Accumulated depreciation 31.12 18 827 822 18 286 898 Book value leasing assets 31.12 23 454 312 24 346 528 Customer receivables -1 507 489-1 402 446 Goodwill/badwill -560-1 663 Other accruals 110 013 128 728 Book value in the balance sheet 31.12 22 056 275 23 071 146 Customer receivables are ordinary leasing receivables and advancement on leasing rent. Establishing fee constitute other accruals. Overview of future minimum finance lease rental: 31.12.2012 31.12.2011 Within 1 year 5 869 501 6 153 259 1 to 5 years 18 586 754 19 485 320 Future minimum finance lease rental 24 456 255 25 638 579 Average interest 5,37 % 5,49 % Present value of minimum lease payments 21 925 410 22 931 675 Unearned finance income 2 530 846 2 706 904 Unearned finance income consist of interest, fees and future estimated sales gain. The company uses standard leasing agreements prepared in cooperation with the Association of Norwegian Finance Houses, and similar agreements in Denmark and Sweden. The company offers leasing of a broad range of equipment to Scandinavian businesses and public sector entities where the material leasing arrangements consist of equipment that fall within: Industry: Construction machinery, production machinery, graphic machinery, forestry machinery, fish farming installations, furnishing etc. High-Tech: ICT-equipment, copy machines, office machines, medical equipment etc. Transport: Vans, trailers, buses, tractors, farming equipment, trucks, mobile cranes, automobiles, containers, helicopters, airplanes, ships etc.

ANNUAL ACCOUNTS 41 12. TANGIBLE FIXED ASSETS AND INTANGIBLE ASSETS Machines, fixtures, transportation equipment Intangible assets Machines, fixtures, transportation equipment Intangible assets Amounts in NOK thousand 2012 2012 2011 2011 Purchase costs 01.01 33 686 83 713 28 800 83 131 Change in value - opening balance -186-14 -14-1 Purchases 5 576 823 9 426 583 Sales -2 291 0-4 526 0 Purchase costs 31.12 36 786 84 522 33 686 83 713 Accumulated ordinary depreciation 01.01 19 706 73 145 18 878 65 566 Change in value - opening balance -155-14 -12-1 Ordinary depreciation of the year 5 095 5 087 4 700 7 579 Change in value - during the year -3 0 3 0 Reversed sold -859 0-3 863 0 Accumulated depreciation 31.12. 23 784 78 218 19 706 73 145 Book value 31.12. 13 002 6 304 13 981 10 568 Intangible assets consist of software, which is depreciated linearly over 3-7 year from the time the software is taken into use. Machines, fixtures, transportation equipment is depreciated linearly over 3-10 years. Tangible assets are not pledged or in any other way used as collateral. 13. RESTRICTED DEPOSITS Deposits with financial institutions include restricted deposits for withholding tax of NOK 10 493 451.

42 ANNUAL ACCOUNTS 14. FINANCIAL DERIVATIVES Financial derivatives are contracts stipulating financial values in the form of interest rate terms for fixed periods of time. Derivatives used by SG Finans AS include interest rate swaps (IRS), currency swaps and forward rate agreements (FRA). Financial derivatives are used to manage interest rate risk from the company s ordinary operations. The table below shows nominal values as well as positive and negative market values of the interest rate swaps. The company does not have any outstanding forward rate agreements at year end. Amounts in NOK thousand 31.12.12 31.12.11 Nominelle verdier totalt Positiv markedsverdi Negativ markedsverdi Nominal values total Positive market value Negative market value Interest rate swaps NOK 1 187 179 0 123 772 1 250 582 0 122 693 Interest rate swaps DKK 450 056 0 19 808 559 688 0 28 776 Interest rate swaps SEK 332 516 0 4 880 363 818 0 3 309 Currency swaps USD 0 0 0 300 325 17 430 0 Currency swaps EUR 3 761 556 3 846 107 359 4 064 651 4 500 46 610 TOTAL 5 731 307 3 846 255 818 6 539 063 21 931 201 388 At year end 2012 the company had one interest rate swap in NOK, and two in DKK which were classified as held for trading. Nominal value on these were TNOK 51 606 and the negative market value was TNOK 8 542. Year end 2011 the nominal value was TNOK 51 702 and the negative market value was TNOK 7 366. SPECIFICATION OF FINANCIAL DERIVATIVES IN NOMINAL VALUES - 2012 Amounts in NOK thousand 1 month from 1 month to 3 months from 3 months to 1 year from 1 year to 5 years > 5 years No maturity TOTAL Maturity profile, fixed rate loans - NOK 0 20 951 293 081 466 882 440 327 0 1 221 241 Maturity profile, fixed rate loans - DKK 0 51 548 150 220 313 714 21 025 0 536 507 Maturity profile, fixed rate loans - SEK 0 54 111 120 701 192 096 28 598 0 395 506 Maturity profile, fixed rate loans -USD 0 0 0 0 0 0 Maturity profile, fixed rate loans - EUR 737 560 0 885 072 2 138 924 0 0 3 761 556 Sum fixed rate loans 737 560 126 610 1 449 074 3 111 616 489 950 0 5 914 810 Maturity profile, interest rate swaps - NOK 0 986 293 837 452 724 439 632 0 1 187 179 Maturity profile, interest rate swaps - DKK 0 2 965 143 767 286 518 16 806 0 450 056 Maturity profile, interest rate swaps - SEK 0 0 119 123 187 683 25 710 0 332 516 Maturity profile, currency swaps - USD 0 0 0 0 0 0 0 Maturity profile, currency swaps - EUR 737 560 0 885 072 2 138 924 0 0 3 761 556 Sum swaps 737 560 3 951 1 441 799 3 065 849 482 148 0 5 731 307 Net position 0 122 659 7 275 45 767 7 802 0 183 503

ANNUAL ACCOUNTS 43 In order to measure the company s interest risk, the effect of a parallel change of 1% (100bp) over the whole interest curve is measured on the company s unsecured interest positions. As at 31.12.2012 the company s interest sensitivity was corresponding to TNOK 137 917 of which TNOK 135 917 is related to loan to the group. Impact on operating result before tax, with an impact of TNOK 99 116 on equity and net income. SPECIFICATION OF FINANCIAL DERIVATIVES IN NOMINAL VALUES - 2011 Amounts in NOK thousand 1 month from 1 month from 3 months from 1 year > 5 years No maturity TOTAL Maturity profile, fixed rate loans - NOK 0 57 067 389 560 420 503 465 073 0 1 332 203 Maturity profile, fixed rate loans - DKK 0 59 256 161 077 408 311 25 371 0 654 014 Maturity profile, fixed rate loans - SEK 0 56 484 144 468 266 372 33 579 0 500 904 Maturity profile, fixed rate loans -USD 0 0 300 325 0 0 0 300 325 Maturity profile, fixed rate loans - EUR 595 589 583 220 1 168 118 1 717 724 0 0 4 064 651 Sum fixed rate loans 595 589 756 027 2 163 548 2 812 910 524 023 0 6 852 097 Maturity profile, interest rate swaps - NOK 0 884 379 520 404 465 465 713 0 1 250 582 Maturity profile, interest rate swaps - DKK 0 1 045 159 003 376 638 23 002 0 559 688 Maturity profile, interest rate swaps - SEK 0 0 119 826 215 337 28 655 0 363 818 Maturity profile, currency swaps - USD 0 0 300 325 0 0 0 300 325 Maturity profile, currency swaps - EUR 595 589 583 220 1 168 118 1 717 724 0 0 4 064 651 Sum swaps 595 589 585 149 2 126 792 2 714 163 517 370 0 6 539 063 Net position 0 170 878 36 756 98 747 6 653 313 034 In order to measure the company's interest risk, the effect of a parallel change of 1% (100bp) over the whole interest curve is measured on the company's unsecured interest positions. As at 31.12.2011 the company's interest sensitivity was corresponding to TNOK 126 448 of which TNOK 123 523 is related to loan to the group. Impact on operating result before tax, with an impact of TNOK 91 043 on equity and net income.

44 ANNUAL ACCOUNTS 15. FUNDING / INTEREST EXPENSES Amounts in thousand (currency) Funding from Société Générale 2012 SG Finans AS' total interest expenses to Société Générale amounted to TNOK 695 086 in 2012. Interest expenses are distributed on the following currencies (all figures in currency): Currency Interest expense Average interest rate End balance Average balance CHF 27 0,48 % 5 002 5 514 DKK 21 120 1,41 % 1 450 000 1 500 539 EUR 8 287 1,41 % 574 118 588 185 GBP 62 1,51 % 4 873 4 091 NOK 450 369 3,02 % 14 941 628 14 922 988 SEK 153 862 3,38 % 4 500 000 4 551 763 USD 1 832 1,60 % 68 873 114 647 2011 SG Finans AS' total interest expenses to Société Générale amounted to TNOK 696 086 in 2011. Interest expenses are distributed on the following currencies (all figures in currency): Currency Interest expense Average interest rate End balance Average balance CHF 24 0,34 % 6 025 7 021 DKK 20 766 1,50 % 1 551 077 1 388 039 EUR 6 670 1,63 % 602 252 408 027 GBP 38 1,07 % 3 310 3 541 NOK 488 190 3,16 % 14 904 349 15 425 857 SEK 127 611 3,33 % 4 603 527 3 837 897 USD 4 268 0,98 % 160 420 435 119 16. OTHER LIABILITIES Amounts in NOK thousand 31.12.12 31.12.11 Accounts payable 254 337 323 956 Excise duty 71 047 41 857 Other liabilites 34 856 40 966 Prepayment from customers 354 673 383 671 Sum other liabilities 714 914 790 449 Payments received not yet allocated to a contract on the balance sheet date are included in prepayment from customers.

ANNUAL ACCOUNTS 45 17. RISK MANAGEMENT Credit risk In the business of financing assets (equipment leasing) and receivables (factoring) credit risk is the most important risk for the company. Effectively managing credit risk is therefore very important. The company has implemented a credit policy, organising procedures and regulations as well as models which address this need. SG Finans has developed classification models for risk assessment and management of business credits, which provide a good view of the risk profile of the portfolio. The classification builds on debtor solidity and market value assessments of the assets. Of greatest importance is that the provided credit is secured by direct ownership (leasing) or security (loans). The value development of the financed objects is therefore critical in assessing and controlling the risk profile of the portfolio, and knowledge about the object s second-hand value, liquidity and markets is therefore fundamental for the credit quality and total loss in the portfolio. In those cases where a customer defaults on the payment terms in the leasing contract, SG Finans may have to terminate the contract and repossess the asset. The company works to ensure rapid sale of repossessed assets in order to hold the total quantity of assets in storage at an acceptable level. Operational risk The company has implemented the Société Générale group s procedures for identification, assessment and reporting of losses caused by operational risk events. Reported events are used in calculating and allocating capital requirements from the group to cover operational risk. Furthermore the company has established monitoring and reporting of a number of key risk indicators for operational risk. The company also performs scenario analysis and stress testing of operational risk scenarios. Self-assessment of risks and controls is a central element in the identification and management of operational risk. Observed losses caused by failures in internal routines, system failures, internal/external fraud and other operational events are very limited. Of the observed events, attempts of external fraud and execution errors are the most common. We assess that the existing control measures are satisfactory for uncovering and preventing this type of fraud and errors. Financial risk management The company is subject to the group s guidelines for financial risk management (defined as interest rates, currency, liquidity and funding) as well as guidelines from the Board incorporated into the company s finance policy and liquidity policy. Management and control of financial risk are carried out centrally in the finance division, the treasury at the company s headquarters. The treasury attends to the needs for financing, financial risk management, together with banking relations for the whole company i.e. the operations in all the countries. The treasury is organised as a service centre whose main purpose is to facilitate financing and hold the financial risk within defined limits. The boundaries for financial risk are relatively limited and adjusted to the size and needs of the operation. The financial risk is reported to the company s assets and liabilities committee (ALCO) and the group s unit for monitoring and control of financial risk. ALCO has responsibility for the limits, measurement principles and monitoring of financial risk (interest rates, currency, funding and liquidity), managing assets and liabilities, capital requirements and capital structure. Interest rate risk management We have continued the company policy to macro hedge fixed interest rate contracts, with the objective of ensuring that the economic and accounting effects of changes in interest rate markets are held at a limited level. Our economic risk at the end of the year was almost fully hedged against changes in interest rates and loans outstanding matches the funding. Due to small differences in the maturity profile between fixed interest rate contracts and hedging swaps, a small number of swaps do not meet the hedge accounting requirements.these interest rate swaps are classified as for trading purposes and the change in market value is posted directly to the income statement. The efficiency of new hedges is tested prospectively prior to entering new hedging contracts and thereafter on a quarterly basis for existing hedging relationships. The efficiency is measured based on accumulated changes in the market value for hedging instruments and hedged contracts using the dollar-offset method. Please refer to the notes for a closer description of accounting effects and interest rate sensitivity.

46 ANNUAL ACCOUNTS Currency risk management Currency risk is managed by borrowing in the same currency and with the same maturity as assets in the foreign currency. The net result from contracts in foreign currencies is exchanged into NOK or other local currency on realisation. Moreover, the result from the branches in Sweden and Denmark is exchanged into Norwegian Kroner. As a general rule, the company does not use currency contracts for hedging purposes, but can use shortterm forward contracts to lock the exchange rate for a known quantity of cash flows in connection with financing new objects or receivables. Liquidity management / funding The company s funding is entirely provided by the Société Générale group. Funding from the group is based on a frame agreement for funding as well as funding limits according to our funding needs over time, based on budgeted and expected growth. Planning and managing liquidity and funding thus occur in close collaboration with the group unit for financing of subsidiaries and operating businesses. Since the second half of 2007 capital markets have been marked by financial crisis, lack of confidence and a sharp reduction in liquidity in the interbank market followed by an increase in funding costs and general increase in credit spreads. Interbank markets were very volatile in 2008, with a peak in turbulence in September / October further to the collapse of Lehman Brothers. Throughout 2012 we have experienced a general improvement in the markets. SG Finans gets its funding from the parent company and we have in the entire period maintained a close contact with our parent. In total we can conclude that the company at all times has had access to satisfactory levels of funding and liquidity, in spite of the general financial crisis and the extraordinary turbulence in the market marking 2008 and 2009. A central element in the management of the financial crisis has been the possibility to incorporate increased cost of funding in the pricing of financing to clients. Solidity / Capital Adequacy / Capital Management The company s policy for capital management defines the applicable principles and guidelines for capital planning and management. Moreover, the company is subject to the group s guidelines for capital management. The internal guidelines compel the company always to comply with the internal requirements which are stricter than the local regulatory minimum requirements. A central part of the policy for capital management is regular assessment of the capital situation and capital adequacy under stress tests for various scenarios and relevant types of risk. This has been carried out in accordance with the regulatory requirements for internal processes for the assessment of capital adequacy (Internal Capital Adequacy Assessment Process or ICAAP). The analysis demonstrates that the company s capital adequacy and solidity is satisfactory in respect of expected future growth and also following the stress tests that have been carried out. At the end of 2012 the company had not issued other subordinated debt or other forms of tier 2 capital. Corporate Governance / Internal control As part of the Société Générale group, the company has continued the development of its principles and framework for internal control and corporate governance to the standards of the group. The main risks and the efficiency of internal controls are assessed on a regular basis. The results of these assessments are satisfactory. 18. RISK CLASSIFICATION In the business of financing assets (equipment The company uses a risk classification system for customers and exposures. The classification is based on objective criteria and consists of two parameters, the customer s creditworthiness and the object s security coverage. Counterparty classification is based on available financial information, as well as other information. The combination of these parameters determines how the exposure is classified. Models for calculating credit risk (probability of default), loss given default and other parameters are used in estimating the risk of an exposure and the level of capital needed to cover future expected and unexpected losses. Exposures are classified in categories in accordance with capital adequacy regulations for banks and finance houses. The company therefore classifies customers into categories based on the customer s nature, size, exposure size and type. Low (0,03 %), medium/low (0,0894 %), medium (3,8774 %), high (17,1134 %) are the classes used along with non-performing and unclassified. The values in

ANNUAL ACCOUNTS 47 bracket present the cut-off probability of default for the class. Loans are defined as being in default when the delay in payment exceeds 90 days and the delay is not due to accidental circumstances at the customer. See also accounting principles. Maximal credit exposure is calculated based on net loan to customer (not considering third-party guarantees), contingent liabilities like guarantees, loan commitments, and positive market value on derivatives or fixed interest loans. SG Finans AS has collateral through right of ownership for leased objects. Other loans and factoring are generally secured by pledge, notification or third-party guarantees, see also note 17. Risk classification loan to customer 2012 Low Medium/low Medium High Doubtful Unclassified Total Gross loans 2 974 060 12 275 296 3 784 388 839 006 630 564 5 856 796 26 360 110 Percentage share 2012 11,28 % 46,57 % 14,36 % 3,18 % 2,39 % 22,22 % 100 % 2011 Low Medium/low Medium High Doubtful Unclassified Total Gross loans 2 841 040 14 823 263 4 129 205 1 194 401 751 921 4 163 519 27 903 349 Percentage share 2011 10,18 % 53,12 % 14,80 % 4,28 % 2,69 % 14,92 % 100 % Maturity analysis - age of loans Past due, days outstanding 2012 Not past due 1-29 30-59 60-89 90-179 > 180 > 1 year sum total Loans 24 453 263 352 469 915 153 225 142 118 625 39 188 57 070 26 160 911 Percentage rate 93,47 % 1,35 % 3,50 % 0,86 % 0,45 % 0,15 % 0,22 % 100,0 % Past due, non-doubtful 1-29 30-59 60-89 90-179 > 180 > 1 year sum total Loans 325 537 878 022 184 648 11 316 1 028 363 1 400 913 Past due, days outstanding 2011 Not past due 1-29 30-59 60-89 90-179 > 180 > 1 year sum total Loans 25 485 055 629 633 1 018 707 253 465 130 862 100 816 48 100 27 666 637 Percentage rate 93,13 % 2,30 % 3,72 % 0,93 % 0,48 % 0,37 % 0,18 % 100,0 % Past due, non-doubtful 1-29 30-59 60-89 90-179 > 180 > 1 year sum total Loans 606 624 973 502 214 990 18 700 1 485 132 1 815 432 Credit exposure Amounts in NOK thousand 2012 2011 Net loans to customers 26 160 912 27 666 638 Positive marketvalue derivatives 3 846 21 931 Guarantee liabilities and loan commitments 316 841 452 481 Total credit exposure 31.12 26 481 599 28 141 050 Collateral and other credit enhancements as described in note 17 and 18 are taken into account the company s risk classification. The Company s maximum credit exposure is TNOK 26 481 599, and open risks are estimated to be TNOK 409 728 for leased objects.

48 ANNUAL ACCOUNTS 19. DOUBTFUL LOANS Amounts in NOK thousand 31.12.2012 31.12.2011 Gross doubtful loans 630 564 751 921 - Write-downs on impaired assets 199 199 236 712 Net doubtful loans 431 365 515 210 Gross doubtful loans are total engagements for customers where one or more of the contracts are considered to be doubtful, see notes 1 and 2. Gross doubtful loans are mainly engagements in default, see notes 8 and 18. 20. REPOSSESSED ASSETS Repossessed assets at 31.12.2012 amounted to TNOK 67 788 against TNOK 108 722 in 2011, consisting of 268 contracts against 376 contracts at end 2011. This is a reduction of TNOK 40 934 during the year. For 2011 the reduction was TNOK 62 499. The turnover from disposal of repossessed assets amounted to TNOK 353 515compared to TNOK 409 683 in 2011. Repossessed assets consist of 3 % high tech, 51 % industrial and 46 % transport equipment. SG Finans has an objective of quickly realizing repossessed assets, and maintaining stock at a reasonable level. The company does not use repossessed assets, but sells the objects to third-parties. In 2012 the number of repossessed assets has decreased due to an decrease number of non-performing loans. SG Finans AS has in general obtained acceptable prices for repossesed assets in 2012 and the market has showed signs of improvement compared to last year.

ANNUAL ACCOUNTS 49 21. INTEREST RISK AND INTEREST RATE ADJUSTMENT PERIOD Interest rate risk arise from loan and leasing engagements where SG Finans receives fixed interest rate payments from the client. The interest rate can be fixed for different maturities, and in order to manage interest rate exposure, SG Finans AS applies different methods for interest rate hedging. See notes 1 and 17 for a description of hedging. Generally, a change in market interest rates will take effect faster in the interest rate to customer than it will in the funding rate. During the three months it will however be equalised. 2012 Amounts in NOK thousand Period until next interest rate adjustment 1 month from 1 month 3 months Financial assets from 3 months to 1 year from 1 year to 5 years > 5 years No agreed fixed rate Total Receivables, bank 691 951 0 0 0 0 0 691 951 Loans to financial institutions 0 164 164 174 994 1 100 084 1 550 107 0 2 989 349 Financial derivatives 3 846 0 0 0 0 0 3 846 Loans to customers 24 007 657 126 610 564 002 972 692 489 950 0 26 160 911 - hereof foreign currency 6 456 422 105 659 270 921 505 810 49 623 0 7 388 435 Other assets 56 508 0 0 0 0 0 56 508 Total financial assets 31.12.2012 24 759 962 290 774 738 996 2 072 776 2 040 057 0 29 902 565 Financial liabilities Debt to banks 8 703 890 16 293 666 0 0 0 0 24 997 556 - hereof foreign currency 4 279 766 5 727 665 0 0 0 0 10 007 431 Customer deposits/debt to customer 145 050 0 0 0 0 0 145 050 Financial derivatives 255 818 0 0 0 0 0 255 818 Retention of margin 43 118 0 0 0 0 0 43 118 Other liabilities 714 914 0 0 0 0 179 258 894 172 Total financial liabilities 31.12.2011 9 862 790 16 293 666 0 0 0 179 258 26 335 714 Total balance sheet items 14 897 172-16 002 892 738 996 2 072 776 2 040 057-179 258 3 566 851 Interest rate swaps - nominal values 0-3 951-556 727-926 925-482 148 0-1 969 751 - hereof foreign currency 0-2 965-262 890-474 201-42 516 0-782 572 Guarantees - given -68 725-68 725 Guarantees - received 47 603 47 603 Total balance sheet and off-balance sheet items 14 897 172-16 006 843 182 269 1 145 851 1 557 909-200 380 1 575 978

50 ANNUAL ACCOUNTS 2011 Amounts in NOK thousand Period until next interest rate adjustment Financial assets 1 month from 1 month to 3 months from 3 months to 1 year from 1 year to 5 years > 5 years No agreed fixed rate Total Receivables, bank 630 731 0 0 0 0 0 630 731 Loans to financial institutions 33 254 164 563 175 984 1 100 085 1 430 106 0 2 903 992 Financial derivatives 21 931 0 0 0 0 0 21 931 Loans to customers 25 179 516 172 807 695 105 1 095 186 524 023 0 27 666 637 - hereof foreign currency 7 435 352 115 740 305 545 674 683 58 950 0 8 590 270 Other assets 16 616 0 0 0 0 0 16 616 Total financial assets 31.12.2011 25 882 048 337 370 871 089 2 195 271 1 954 129 0 31 239 907 Financial liabilities Debt to banks 8 225 507 18 084 068 24 142 0 0 0 26 333 717 - hereof foreign currency 4 476 116 6 870 333 24 142 0 0 0 11 370 591 Customer deposits/debt to customer 187 682 0 0 0 0 0 187 682 Financial derivatives 201 388 0 0 0 0 0 201 388 Retention of margin 76 476 0 0 0 0 0 76 476 Other liabilities 790 450 0 0 0 0 585 535 1 375 985 Total financial liabilities 31.12.2011 9 481 503 18 084 068 24 142 0 0 585 535 28 175 248 Total balance sheet items 16 400 545-17 746 698 846 947 2 195 271 1 954 129-585 535 3 064 659 Interest rate swaps - nominal values 0-1 929-658 349-996 441-517 368 0-2 174 087 - hereof foreign currency 0-1 045-278 829-591 976-51 655 0-923 505 Guarantees - given 0 0 0 0 0-52 534-52 534 Guarantees - received 0 0 0 0 0 47 401 47 401 Total balance sheet and off-balance sheet items 16 400 545-17 748 627 188 598 1 198 830 1 436 761-590 668 885 439

ANNUAL ACCOUNTS 51 22. LIQUIDITY RISK AND REMAINING MATURITY ON BALANCE SHEET ITEMS Funding is provided by the parent company Société Générale, on the basis of a framework agreement and limits. The company's liquidity risk is therefore linked to the owner, and refinancing is organised in close collaboration with the group treasury departement. The table below shows due date for assets and liabilities in nominal values. 2012 Amounts in NOK thousand Period until next interest rate adjustment 1 month from 1 month to 3 months Financial assets from 3 months to 1 year from 1 year to 5 years > 5 years No agreed fixed rate Total Loans / receivables, banks 691 951 0 0 0 0 0 691 951 Loans to financial institutions 0 164 165 174 995 1 100 084 1 550 105 0 2 989 349 Financial derivatives 3 846 0 0 0 0 0 3 846 Loans to customers 1 780 774 2 353 790 5 178 755 15 046 296 1 801 296 0 26 160 911 - hereof foreign currency 524 429 551 132 1 634 077 4 391 621 287 176 0 7 388 435 Other assets 49 454 7 054 0 0 0 0 56 508 Total financial assets 31.12.2012 2 526 026 2 525 009 5 353 750 16 146 380 3 351 401 0 29 902 566 Financial liabilities Debt to banks 2 391 000 1 650 802 7 072 276 12 333 371 1 550 107 0 24 997 556 - hereof foreign currency 616 876 1 256 504 1 544 644 6 589 407 0 0 10 007 431 Customer deposits/debt to customer 145 050 0 0 0 0 0 145 050 Financial derivatives 255 818 0 0 0 0 0 255 818 Retention of margin 43 118 0 0 0 0 0 43 118 Other liabilities 659 269 399 817 232 669 26 332 27 149 0 1 345 236 Total financial liabilities 31.12.2012 3 494 255 2 050 619 7 304 945 12 359 703 1 577 256 0 26 786 778 2011 Amounts in NOK thousand Period until next interest rate adjustment 1 month from 1 month to 3 months Financial assets from 3 months to 1 year from 1 year to 5 years > 5 years No agreed fixed rate Total Loans / receivables, banks 630 731 0 0 0 0 0 630 731 Loans to financial institutions 33 254 164 563 175 984 1 100 085 1 430 106 0 2 903 992 Financial derivatives 21 931 0 0 0 0 0 21 931 Loans to customers 2 031 235 3 290 353 5 421 082 15 047 552 1 876 415 0 27 666 637 - hereof foreign currency 915 979 1 800 009 4 837 265 349 269 0 8 590 270 7 388 435 Other assets 8 158 0 0 0 0 16 616 56 508 Total financial assets 31.12.2011 2 725 609 3 463 074 5 597 066 16 147 637 3 306 521 0 31 239 907 Financial liabilities Debt to banks 3 084 460 7 513 023 11 469 515 1 407 325 0 26 333 717 24 997 556 - hereof foreign currency 1 018 544 1 596 335 4 325 161 4 430 551 0 0 11 370 591 Customer deposits/debt to customer 0 0 0 0 187 682 0 187 682 Financial derivatives 0 0 0 0 0 201 388 255 818 Retention of margin 0 0 0 0 0 76 476 43 118 Other liabilities 609 906 470 440 58 039 29 071 88 337 120 191 1 375 984 Total financial liabilities 31.12.2011 3 747 164 3 554 900 7 571 062 11 498 586 1 683 344 120 191 28 175 247

52 ANNUAL ACCOUNTS 23. NET POSITION PER CURRENCY Foreign currency positions arise from contracts in foreign currencies, and from the activities in the branches in Demark and Sweden. Net foreign currency position at year end 2012 was TNOK 86. Hence giving a foreign currency sensitivity of TNOK9 with a 10 % shift in exchange rates between NOK and other foreign currencies. The impact on net result and equity would be equivalent to TNOK 6. For 2011 a shift of 10 % in exchange rates would have resulted in an impact of TNOK 15 79 before tax, and TNOK 1 137 on net profit and equity. 2012: Amounts in NOK thousand USD EUR SEK JPY CHF GBP DKK CAD Assets : Norway 61 766 458 390 2 144 4 161 5 291 4 836 191 115 Sweden 7 454 15 916 0 0 0 0 0 0 Denmark 0 112 872 1 0 0 0 0 0 Sum of assets 31.12.2012 69 220 587 177 2 145 4 161 5 291 4 837 191 115 Debt : Norway 62 403 457 999 2 037 0 5 132 4 732 596 28 Sweden 7 418 15 850 0 0 0 0 0 0 Denmark 0 113 182 0 0 0 0 0 0 Sum of debt 31.12 69 821 587 030 2 037 0 5 132 4 732 596 28 Net balance sheet items -601 147 108 4 161 158 104-404 87 Converted to NOK -3 361 1 084 93 270 968 944-400 487 Foreign currency sensitivity (10% shift) before tax Foreign currency sensitivity (10% shift) after tax -336 108 9 27 97 94-40 49-242 78 7 19 70 68-29 35 2011: Amounts in NOK thousand USD EUR SEK JPY CHF GBP DKK CAD Assets : Norway 90 912 476 490 2 542 2 531 6 106 3 393 331 84 Sweden 69 725 59 599 0 0 0 0 0 0 Denmark 0 90 424 65 0 0 0 0 0 Sum of assets 31.12.2011 160 637 626 514 2 607 2 531 6 106 3 393 331 84 Debt : Norway 91 319 477 827 2 274 16 6 106 3 325 274 30 Sweden 69 701 59 700 0 0 0 0 0 0 Denmark 0 90 914 0 0 0 0 0 0 Sum of debt 31.12.2011 161 020 628 441 2 274 16 6 106 3 325 274 30 Net balance sheet items -383-1 927 333 2 515 0 67 58 54 Converted to NOK -2 298-14 975 289 195 1 623 60 317 Foreign currency sensitivity (10% shift) before tax Foreign currency sensitivity (10% shift) after tax -230-1 498 29 19 0 62 6 32-165 -1 078 21 14 0 45 4 23

ANNUAL ACCOUNTS 53 24. OWNERSHIP The share capital of SG Finans AS is constituted of 101 shares, with a nominal value of NOK 9.360.750 per share. All issued shares have equal voting rights and the same right to receive dividend. All shares are held by SG Equipment Finance International GmbH, Wuppertal, Germany, which is 100 % owned by Société Générale SA, Paris, France. Ordinary shares 2012 2011 Issued and fully paid January the 1st 101 101 December 31st 101 101 Proposed group contribution to be approved at annual general meeting. In accordance with IFRS, the group contribution is not recognised as a liability in the financial statements for 2011 until the contribution is aproved. Ordinary shares 2012 TNOK 4 158,41 per share 420 000 25. INFORMATION ON RELATED PARTIES AND REMUNERATIONS Receivables from and debt to Group companies (Société Générale) amounted to : 2012 Amounts in NOK thousand 31.12.12 Interest 2012 31.12.11 Interest 2011 Receivables from and debt to Group companies (Société Générale) amounted to : Assets Loans to Group companies 2 989 349 123 728 2 870 738 125 316 Sum 2 989 349 123 728 2 870 738 125 316 Liabilities Loans from Group companies 24 997 556 677 468 26 333 717 696 086 Other liabilities 51 731 120 191 Sum 25 049 287 677 468 26 453 908 696 086 Funding is provided by the parent company Société Générale, on the basis of a framework agreement and limits. All transactions are made on market terms. SG Finans has recognised TNOK 51 940 for the purchase of intercompany services from the parent company.

54 ANNUAL ACCOUNTS Remuneration of senior management Pay Bonus Pension cost Other remuneration Share options Total 2012 Total 2011 Carsten Thorne, managing director 2 174 659 735 217 373 4 158 3 510 Hans Einar Herzog, deputy managing director 1 501 1 753 237 157 235 3 883 2 187 Total remuneration of senior management 3 675 2 412 972 374 608 8 041 5 697 Senior managers are persons with authority to commit the company by virtue of their position (power of procuration). Bonus payments are dependant on the results achieved in relation to agreed targets. An early retirement pension plan is established for the CEO, entitling him to receive an early retirement pension of 60 % of pensionable salary from the age of 62 years. Share options are issued from Société Générale SA, and give the right of purchase of shares in Société Générale SA. The options have a 3 year lock-in period, and exercise of options require that the employee must be employed at the date of exercise. For 50% of options issued in 2009, EPS for Société Générale SA must exceed EUR 3,5 / EUR 7,5 in average for the financial years 2009-2012. Options Received in the financial year Excercised Forfeited or refused Balance Carsten Thorne, managing director 0 0 379 3 896 Hans Einar Herzog, deputy managing director 0 0 71 1 068 Strike price per share option Issue year 2008 2009 2010 2011 2012 Number of options received 3 820 1 302 0 0 0 Strike price per share option 63,60 23,18 0,00 0,00 0,00 Exercise date (start) 31.03.11 31.03.12 The total amount of deferred shares received is 1 429 for Carsten Thorne, managing director and 379 for Hans Einar Herzog, deputy managing director a in total 1 808 deferred shares. The performance conditions for deferred shares are the same as for share options, and the vesting period is until March 31st, 2014. The fair value of deferred shares is presented with the fair value of share options in the presentation of remuneration to senior management above.

ANNUAL ACCOUNTS 55 Remuneration to the Board of Directors Pay / Fees Bonus Other remuneration Marie-Chrstine Ducholet, chairman 0 0 0 0 0 Jacques Bensen, board member 0 0 0 0 0 Karin Cecilie Kullmann Five, board member 125 0 0 125 125 Jean-Marc Mignerey, board member 150 0 0 150 38 Tommy Pedersen, board member 150 0 0 150 150 Kjell Vegard Opheim, employee representative 16 0 0 16 16 Total remuneration to the Board of Directors 441 0 0 441 329 Total 2012 Total 2011 Remuneration to the Control Committee Pay / Fees Bonus Remuneration 2012 2011 Stephen Knudtzon, chairman 119 0 0 119 125 Karl Anton Nilsen 4 0 0 4 20 Anders Aavatsmark 16 0 0 16 20 Jan Nystrøm 8 0 0 8 12 Total remuneration to the Control Committee 147 0 0 147 177 Fees of TNOK 47,5 were paid to the Committee of Representatives, with the Chairman receiving TNOK 27,5 and the other members TNOK 2,5 each. No loans or guarantees have been granted to senior managers in the Company. Nor have any loans or guarantees been granted to related members of the Board of Directors, Committee of Representatives or the Control Committee. 26. CAPITAL ADEQUACY The calculation of capital requirement and capital adequacy has been done following the Standard Method for Credit Risk and the Basic Indicator Approach for Operational Risk. The entity does not take Market Risk positions and the capital requirement for Market Risk is nil. Amounts in NOK thousand 2 012 2011 Sum of equity 3 453 075 3 198 251 Deductions: Other intangible assets -6 304-10 568 Deferred tax asset -249 876 0 Profit for the year -254 981-273 424 Expected dividend exceeding profit for the year -165 019 0 Core capital 2 776 896 2 914 259 Total capital base 2 776 896 2 914 259 Risk-weighted assets 23 676 408 25 109 457

56 ANNUAL ACCOUNTS Capital adequacy ratio Capital requirement credit risk 1 894 113 2 008 757 Capital requirement operational risk 173 165 163 280 Capital requirement market risk 0 0 Total capital requirement 2 067 278 2 172 037 Capital buffer to minimum regulatory capital 709 618 742 223 Pilar II additional capital requirment 248 280 245 288 Net capital buffer after Pilar II requirement 461 338 496 935 Capital adequacy ratio 10,75 % 10,73 % 27. GUARANTEE LIABILITIES AND LOAN COMMITMENTS Amounts in NOK thousand 31.12.2012 31.12.2011 Endorser's liability 457 811 Guarantee liability 68 268 51 724 Total pr. 31.12 68 725 52 534 SG Finans AS has at year end 2012 given loan commitments of TNOK 248 116. The commitments are related to agreed financing of equipment where the contracts have not yet been established. By the end of 2011 the corresponding amount was TNOK 399 947. 28. CONTINGENCIES SG Finans AS had no major legal disputes pending or contingencies at the end of 2012. 29. NUMBER OF EMPLOYEES Total Norway Sweden Denmark Number of employees 01.01.2012 373 298 44 31 Recruitment 16 16 0 0 Departures 31 29 1 1 Number of employees 31.12.2012 358 285 43 30

57 AUDITOR S REPORT/ CONTROL COMMITTEE S STATEMENT SG Finans AS Kontrollkomitéen The Control Committees Statement To the Committee of Representatives and the General Meeting of SG Finans AS The Control Committee has throughout the accounting period of 2012 supervised the company according to the Financial Institutions Act 3-11 and the instructions for Control Committees determined by the Securities Commission on the 18 th of December 1995. The Control Committee has examined the Annual report 2012 for SG Finans AS, the Board of Directors annual statement for 2012 and the auditors statement for 2012. The Committee has determined that the Board of Directors evaluation of the company's economic state is accurate and recommends that the annual accounts are established for the company for 2012. Lysaker, the 7 th of March 2013 Stephen Knudtzon Formann Anders Aavatsmark Jan Nystrøm

58 Employee representatives and management in 2012 BOARD OF DIRECTORS Employer Chairman Marie-Christine Duchole Chief Executive Officer, SG Equipment Finance Jaques Bensen Supervisor DSFS, Paris Jean-Marc Mignerey Independant Board Director Karin Cecilie Kullmann Five Advisor public affairs, Bærum Tommy Pedersen CEO, Augustinus Fonden Employee representative Kjell Vegard Opheim Director Factoring, Region East, SG Finans AS Employee representative (substitute) Turid Olsen Senior consultant, SG Finans COMMITTEE OF REPRESENTATIVES Chairman Substitute Substitute Employee representative Employee representative Employee representative Employee representative (substitute) Kjersti Tröbråten, Oslo Tommy Eriksen, Grålum Inge Jan Thorsen, Stavanger Tom Erik Eriksen, Oslo Øyvind Nossum, Bergen Leif Finsveen, Bodø Ivar Vallestrand, Torp Håvard Brynjulvsrud, Sk Gunnar Thorud, Oslo Per Kåre Hagen, Oslo Ole Marius Rosendal, Oslo Grethe Hoel Sørnes, Drammen Per Magne Trøim, Oslo Gurvinder Kaur, Oslo Kathrine Svendsen, Oslo CONTROL COMMITTEE Chairman Deputy Chairman Stephen Knudtzon, Oslo Anders Aavatsmark, Oslo Karl Anton Nilsen, Brumunddal Jan Nystrøm, Trondheim MANAGEMENT TEAM SG FINANS AS Carsten Thorne Hans Einar Herzog Armand Taillandier Odd Sørensen Sverre Edin Finn Mathisen Jan Juliussen Stig-Are Eriksen Espen Brochmann Arne Hodnefjell Finn Kristiansen Anders Holmgren Lars Rasmussen Maria Ulla Kjell Brevik Employment CEO Finance, deputy to the CEO Credit Credit adviser IT Sales and Business Development Equipment Finance Sales and Business Development Factoring Region North Region West Region Oslo/Akershus and South Region East Sweden Denmark HR Group coordinator Auditor Ernst & Young AS, represented by Eirik Larsson, state authorised public accountant

59 Addresses Scandinavia and SG Equipment Finance norway TEL. +47 21 63 20 00 Oslo (head office) Strandveien 18 1366 Lysaker Fredrikstad Stortorvet 1 1607 Fredrikstad Kristiansand Kjøita 40 4630 Kristiansand Tromsø Grønnegata 27-29 9251 Tromsø Bergen Sandviksbodene 66 5035 Bergen Hamar Fredvang Allé 10, Briskeby stadion 2307 Hamar Porsgrunn Dokkvegen 10 3920 Porsgrunn Trondheim Klæbuveien 194 7037 Trondheim Bodø Storgaten 8 8006 Bodø Harstad Rikard Kaarbøesplass 3B 9405 Harstad Sandefjord Framnesveien 7 3222 Sandefjord Ålesund Kipervikgaten 13 6003 Ålesund Drammen Tårnkvartalet, Hauges gate 2 3019 Drammen Haugesund Haraldsgate 115 5527 Haugesund Stavanger Kongsgårdbakken 3 4005 Stavanger Sweden TEL. +46 8 470 9530 Stockholm (head office) Solna Torg 3, 4 trappa 171 29 Solna Malmø Kungsgatan 6 221 49 Malmø Skellefteå Kanalgatan 43 031 32 Skellefteå Sundsvall Östra Långgatan 14 Nb 852 36 Sundsvall Göteborg Drakegatan 6 412 59 Göteborg Denmark TEL. +45 70 22 90 33 Copenhagen (head office) Roskildevej 342 B 2630 Taastrup Vejle Havneparken 14 B 1 sal 7100 Vejle Head office International Visiting address SG Equipment Finance Chassagne Tower, 17 cours Valmy Paris - La Défense 7 Frankrike Postal address SG Equipment Finance - DSFS/ SGE Tour Société Générale 75886 PARIS Cedex 18 Frankrike

SG finans AS (head office) strandveien 18, 1366 lysaker, norway sgfinans.no sgfinans.se sgfinans.dk