GENERALI INSURANCE ASSET MANAGEMENT S.p.A. Società di gestione del risparmio, Zweigniederlassung Deutschland

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Jahresabschluss zum Geschäftsjahr vom 01.01.2020 bis zum 31.12.2020

COMPOSITION OF CORPORATE BODIES

BOARD OF DIRECTORS

Santo BORSELLINO	Chairman
Francesco Benedetto MARTORANA ^(*)	Chief Executive Officer
Maurizia CECCHET	Director
Daniel ROY	Director
Mirella PELLEGRINI	Independent Director
Bruno SERVANT ^(**)	Director

^(*) Mr Francesco Benedetto MARTORANA has resigned as Chief Executive Officer, while remaining Director of the Company, with effect from 1 March 2021.
^(**) Mr Bruno SERVANT was appointed Chief Executive Officer of the Company, with effect from 1 March 2021.

BOARD OF STATUTORY AUDITORS

Angelo VENCHIARUTTI	Chairman
Giuseppe ALESSIO VERNI'	Standing Auditor
Tazio PAVANEL	Standing Auditor
Maria Maddalena GNUDI	Alternate Auditor
Nicola SERAFINI	Alternate Auditor

AUDITING FIRM

BDO Italia S.p.A.

Report of the Board of Directors

Dear Shareholders,

The year ended on 31 December 2020 was important for the Company.

In particular, during the 2020 financial year, we continued the work, started in 2018, to implement and specify the processes resulting from the partial spin-off, effective 1 October 2018, of Generali Insurance Asset Management S.p.A. Società di gestione del risparmio (GIAM SGR) for the benefit of the Generali Investments Partners S.p.A. Società di gestione del risparmio (GIP SGR) and its Holding Company, Generali Investments Holding S.p.A. (GI Holding).

In a particularly difficult year due to the general effects of the COVID-19, the Company was able to put in place all the necessary means to mitigate the impact of the pandemic on its business and to adopt all the appropriate and necessary controls to guarantee a correct and effective management of the financial investments which it has been entrusted. Despite all this and despite a significant but not dramatic decline during the year, at the end of 2020, total Assets Under Management were equal to €473.6 billion, above the level recorded at the end of 2019, both in terms of volumes and market value.

The increase in assets under management was matched by an increase in net commission income: a contribution to this was certainly given by the increase, from 1 September 2020, in the management commission rates charged by GIAM SGR under the asset management mandates granted to the Company from some Italian insurance companies of the Group.

INTERNATIONAL FINANCIAL MARKETS SCENARIO: 2020 TRENDS AND 2021 OUTLOOK

Due to the outbreak of the Covid-19 pandemic, widespread lockdowns were introduced in many parts of the world, hitting the global economy hard and weighing on trade and industrial production. All the major economies, with the exception of China, went into recession in the second quarter, and despite a partial recovery in the second half of the year, they are expected to have closed 2020 in negative territory. GDP is expected to fall in 2020 by 3.6% in the US and by 7.3% in the eurozone. In this context, governments reacted with significant fiscal stimuli to avoid even more severe repercussions on the economy. A key role has also been played by the central banks: the Fed brought interest rates down to zero and made QE unlimited, while the ECB launched a temporary pandemic emergency purchase programme (PEPP) worth a total of €1,850 billion, and launched pandemic emergency longer-term refinancing operations (PELTRO), as well as adopting more favourable conditions (TLTRO III).

At the end of the year, some issues that had created further uncertainty in addition to the pandemic were resolved. First of all, the result of the US elections was received positively by the market (greater stimulus to the economy); then, in Europe, an agreement was reached on the 7-year budget and the Recovery Fund, overcoming the obstruction by Hungary and Poland; promising news on COVID-19 vaccines gave hope for a more sustained recovery in 2021. Finally, after very intense negotiations, a compromise trade agreement was reached between the UK and the European Union following Brexit.

The Covid-19 pandemic, with the related lockdowns and monetary and fiscal policy interventions, political developments and concerns about the economic recession have had a strong impact on the global bond market. During the first quarter, yields on American and German bonds decreased considerably, rebounding only partially in the United States in the last months of the year, given the different technical conditions of supply and demand in the US bond market, an increased deficit, higher expectations for a positive evolution of inflation in 2021, as well as the expected spending program of the Biden administration.

In the eurozone, the yield on ten-year Bunds decreased by another 40 bps, closing the year at -0.6%. The decline in yields was even more marked in the other large economies of the eurozone, which saw their spreads narrow. In Italy, after an initial recovery in the first quarter, the rest of the year saw a continuous compression of the BTP-bund spread, which fell from a peak of over 280 bps to 110 bps at the end of December. The decline in yields in the United States was more pronounced along the entire curve. Despite a partial increase in the fourth quarter, the yield on US Treasuries fell 100 bps to 0.9%.

Stock markets experienced high volatility due to substantial uncertainty on the evolution of the pandemic and its effects on the real economy, brought to its knees by a series of generalized lockdowns in all major global economies. Global equity prices fell sharply in the early part of the year during the initial spread of the pandemic, wiping out all 2019 profits. A rebound followed, mainly driven by the strong monetary and fiscal measures put in place by the authorities; the technology sector benefited the most from this, helped by the greater use of digital services by businesses and households. Overall, the MSCI World index posted a total return of 16.5%, driven by the US (S&P 500 +18.4% over the year) and emerging countries (MSCI EM +18.7%). Despite the strong recovery in the second half of the year, European equity prices closed in negative territory, with a total return of -2.6% (Euro Stoxx 50).

The baseline scenario sees a vigorous resumption of growth in mid-2021, when vaccines will allow the restrictions currently in place to be lifted. The rebound of the hardest hit sectors will help to recover pre-crisis activity levels, most likely in the third quarter in the US and in the fourth in the eurozone. The manufacturing and construction sectors (with confidence at all-time highs) confirm a "K-shaped" recovery, while services continue to substantially lag behind with respect to the segment of the economy most sensitive to interest rates. The recovery of the labour market is lagging behind and recently there were even signs of a slowdown. The main risk for this scenario is related to higher than expected business closures and to vaccines, in terms of availability, acceptance and transport.

More specifically, in the USA, after a flat first quarter, consumption is expected to drive a strong recovery, pushing GDP up by 3.9% in 2021, thanks also to expectations of new fiscal stimulus. In the eurozone, we expect the lockdown measures to be relaxed, confidence and investments to increase, and the economy to recover in 2021 by 5.5%. The Recovery Fund (RF) will be of great help to the most affected European economies and will support them as they adopt the necessary reforms, in particular the green and digital transition. There might be further steps towards fiscal integration but they will be gradual; the political debate on how to make the RF a permanent tool has just begun.

The stance of the Fed and the ECB will remain accommodating for a long time: high output gap and unemployment will keep inflation low (especially in the euro-area).

International government bond markets will be heavily impacted by fiscal and monetary policies in 2021. Central banks will retain an accommodating stance and are likely to err on the side of caution to avoid derailing the economic recovery. With central banks keeping key rates at their current low levels well beyond 2021, the short end of the yield curve will remain pegged for now. However, fiscal policy is expected to remain very expansionary in 2021. The upcoming offer of securities with a long duration is likely to trigger a tightening at the very long end of the curve.

Expectations on core yields are of a moderate increase, particularly in the United States, while in the eurozone the push will be more contained as the ECB caps yields through QE and the same effect is produced by low inflation.

There is still some room for spread tightening on non-core eurozone bonds.

Looking ahead, company profits will remain high over the next two years thanks to GDP growth, increased capacity utilization and support from the authorities. Market multiples should remain high relative to historical levels. This is the natural consequence of the persistently low level of real yields and credit spreads, a trend that is expected to continue. Market volatility is expected to be lower than in 2020 as the economic situation slowly normalizes and financial conditions remain favourable. Under these conditions, returns on equities are expected to be between 5% and 10% in 2021.

TRENDS OF FUNDING AND ASSETS UNDER MANAGEMENT OF THE COMPANY

Assets under management as at 31 December 2020 (calculated on the statistical data sent to Assogestioni and the results for CONSOB reporting purposes) were equal to €473,639 million against €470,286 million at the end of 2019. A breakdown of managed portfolios is provided in the following table, along with the comparison with the previous year:

Breakdown of managed portfolios and comparison with the previous year

Portfolios	Stock as at 31/12/2020	% incidence	Stock as at 31/12/2019	% incidence
Own individual portfolios
Collective Portfolio Management	406,955	85.92%	413,789	87.99%
Closed-end pension funds	9,141	1.93%	6,645	1.41%
Total	416,096	87.85%	420,434	89.40%
UCITS promoted
French funds	459	0.10%	457	0.10%
German funds		0.00%	150	0.03%
Special German funds	16,615	3.51%	35,881	7.63%
Luxembourg funds	9,309	1.97%	7,287	1.55%
Total	26,383	5.57%	43,775	9.31%
Products received under mandate	31,160	6.58%	6,077	1.29%
GENERAL TOTAL	473,639	100.00%	470,286	100.00%

The collective portfolio management services offered by the Company continue to be predominantly addressed to corporate investors, mostly within the Generali Group, and to a few of the major European pension funds and insurance companies. Therefore, these are usually medium to large portfolios managed with a high degree of personalisation based on the customer's objectives/needs. The decrease in the total compared to last year is due to the exit of some portfolios relating to the client Proxalto Lebensversicherung. As regards the UCITS promoted, the decrease in German special funds serving the insurance portfolios of local companies is due to their transfer to a manager (MEAG) outside the Group, which in turn gave them under a management mandate to GIAM itself. This explains the almost equal increase in products under mandate.

The latter continue to include the mandates received from Generali Investments SICAV, Generali Multipensions Solutions SICAV, 3BANKEN and Fortuna Investment AG.

PROFIT FOR THE YEAR, SHAREHOLDER'S EQUITY AND MAIN INCOME STATEMENT AND BALANCE SHEET ENTRIES

The financial statements as at 31 December 2020 show a net profit of €114.1 million (€97.5 million in the previous year).

In 2020 profits before taxes were equal to €165.1 million (€142.2 million in the previous year), while direct taxes for the year were equal to €51.0 million (€44.7 million in the previous year). The main items of the income statement as at 31 December 2020 were:

―	net commissions equal to €274.1 million (€258.6 million in the previous year);
―	personnel costs equal to €30.9 million (€36.0 million in the previous year);
―	other administrative expenses equal to €81.3 million (€86.8 million in the previous year), including costs for the service activities of Generali Investments Partners S.p.A. SGR and Generali Investments Holding S.p.A.;
―	other net operating income equal to €16.4 million (€13.9 million in the previous year) including revenues for service activities provided to Generali Investments Partners S.p.A. SGR.

Shareholders' equity as at 31 December 2020 was equal to €222.4 million; besides the aforementioned net profit, it included:

―	share capital equal to €60.1 million (unchanged with respect to the previous year);
―	share premium reserve equal to €53.0 million (unchanged with respect to the previous year);
―	valuation reserves equal to - €88.0 million (- €87.2 million in the previous year);
―	other reserves equal to €83.1 million (€67.4 million in the previous year).

In the balance sheet, assets were equal in total to €323.2 million and included:

―	other financial assets that must be measured at fair value equal to €38.6 million (€56.0 million in the previous year), which basically represent the investment of the company's liquidity in some Generali Investments Sicav sub-funds, in the Group's monetary UCITS, and in other third-party monetary funds;
―	financial assets measured at amortised cost equal to €227.5 million, consisting of receivables for asset management for €128.5 million (€116.4 million in the previous year), mainly representing commission income to be collected for the management of cash and cash equivalents deposited in bank current accounts and with the Parent Company through Direct Cash-Pooling agreements for €99.0 million (€61.3 million in the previous year);
―	tangible assets equal to €13.3 million (€17.0 million in the previous year) including the value in use of leased assets equal to €12.2 million in accordance with the new accounting standard IFRS 16;
―	intangible assets equal to €27.9 million (€37.1 million in the previous year), mainly consisting of the costs incurred to implement the new management system for the financial assets entrusted;
―	tax credits and tax assets equal to €10.4 million (€21.9 million in the previous year), regarding both deferred and current taxes:
―	other assets equal to €5.5 million (€17.7 million in the previous year).

Liabilities were equal to €100.8 million and included:

―	financial liabilities measured at amortised cost equal to €14.3 million, consisting of payables for €1.7 million (€3.3 million in the previous year) basically relating to commission expense due and of €12.6 million for the current value of future lease payments according to IFRS 16;
―	tax liabilities equal to €7,3 million (€17.7 million in the previous year);
―	other liabilities equal to €49.8 million (€51.9 million in the previous year), including trade payables equal to €28.4 million;
―	provisions for risks and charges equal to €26.8 million (€45.1 million in the previous year), mainly consisting of the estimated variable remuneration of employees.

For more information on the composition and change in income statement and balance sheet items, please refer to the Explanatory Notes.

BUSINESS OPERATIONS

The year started as usual with marketing activities aimed at promoting the multi-boutique investment expertise already presented to investors in 2019: various initiatives, including campaigns and events, were planned. However, since the beginning of March, the marketing activity was quickly adapted to the new and unexpected situation caused by the spread of COVID-19. The pandemic reshaped marketing activities, pushing towards greater digitization and wider communication, with a diversification of the contents developed for our customers.

At the level of digital marketing tools, newsletters were redesigned, the production of videos and webinars increased, and podcasts introduced, to make the contents available in different formats. The website was updated, improving its appearance and the possibilities of interaction, to simplify and improve the browsing experience. To provide greater support to investors in this period characterized by high market volatility and a greater level of personal stress, the frequency of communications was increased. Clients received regular information on the Group's commitment to the community during the pandemic, sharing messages from our business units' CEOs on business continuity, the Market Views produced by the Company's research team, and the comments on the markets and portfolios of our fund managers.

Overall, more than 270 newsletters for professional investors and distributors were sent out, current and potential customers were invited to over 100 webinars, and a new series of podcasts were launched to make content available in different formats. For the contents production, we leveraged the strong partnership with all investments teams and with the research team of the Company and we invited external speakers to comment on the main events relevant to the sector. During the year, we continued to work with local and foreign industry media through paid editorial presence, using their databases to disseminate marketing campaigns, and sponsoring digital events organized by them. As far as the Company is concerned, we worked with Investment Pension Europe, addressing pension funds and insurance companies in Europe; in France, we strengthened the relationship with AF2i, a local association of pension funds, holding events jointly with this; in Italy we worked closely with Social Security Itineraries and Institutional World, sponsoring initiatives and sharing content; while in Germany some contents have been published on Institutional Money. In 2020, the Client Service supported the sales activity, also of the Company, pursuing the following objectives:

―	to preserve the existing customer base (through the management of reports, on-boarding/off-boarding activities, and KYC/KYD processes);
―	to maximize business development opportunities through research, evaluation and coordination activities, focusing on RFP, RFI, DDQ, also through sharing by the Company of know-how on investments, risk management and research activities.

As regards the first point, the Company has obtained 3 new mandates, for a total of 1.9 billion assets under management (from Cometa TFR Silente, Cometa Sicurezza 2020, Solidarietà Veneto Garantito TFR). At the same time, four mandates (Cassa del Notariato, which converted the mandate into a direct investment in the funds of Generali Investment Partners, Previdenza Cooperativa OLD, Hamburger Aerzte, Berliner Rechsanwaelte) came to an end.

The Client Service also continued the re-certification campaigns on the Company's fiduciary customers, in compliance with the guidelines and directives specified by the control functions, activating an average of 5 recertifications per quarter.

CHANGES TO ORGANISATIONAL STRUCTURE AND MANAGEMENT OF HUMAN RESOURCES

In 2020 the organisational structure was further consolidated in line with the 2018 spin-off project. In particular, in January 2020, some Staff and Control Functions structures (Accounting & Tax, Risk Governance & Oversight, Valuation & Risk Factor Analysis, Operational Risk Management, Investment Control and HR Operations) were transferred to GIH.

Furthermore, a new Head of Investment Stewardship was appointed, following a reorganization of this business unit, with internal redistribution of some activities.

As at 31 December 2020, there were 155 employees, of which 117 men and 38 women. Industrial relations, in addition to ordinary activities, were focused on managing the impact of the COVID-19 pandemic on the work organisation. In particular, meetings were held regularly to inform the workers' representatives on the measures adopted by the company to deal with the COVID-19 pandemic and agreements were reached to allow a generalised use of remote working (smartworking) from March until the end of the year.

In terms of work organization, in addition to the use of remote work, the COVID-19 emergency had an impact on business trips, which were suspended, and on the methods of accessing the offices, with the setup of segregated areas subject to a maximum daily capacity limit.

Lastly, the transfer of the Trieste office to new premises at Palazzo Berlam took place at the end of September; at the Rome office, preparatory activities took place to move employees from Via Silvio D'Amico to Via Bissolati, a move carried out at the end of January 2021.

With regard to Training and Development activities, the implementation of the "2019-2021 People Strategy" of the Business Unit continued in 2020.

The following projects, among others, were launched in 2020:

―	"Technical expertise Mapping": following the mapping of technical expertise carried out in 2019, 11 new technical courses were launched (e.g. Big data and predictive analytics, ESG & SRI, Agility, Data Privacy, etc.) in which many BU employees took part through the Individual Development Plan;
―	"Actions Engagement Survey 2019": the four actions identified in response to the last Engagement Survey (GENERALI UP, SWITCH THE BOSS, DELEGATION OF SUPER POWERS, OFF-LIMIT TIME ZONES) were implemented in 2020;
―	"Pulse Survey", carried out in May, the results of which were shared in June and with respect to which an action plan was defined and implemented in 2020 (e.g. The Mind Fitness and Antifragility Program, Mind Maps and School of Life courses for employees' children, Parents in the Storm seminars, Meet the Future Program for managers, etc.);
―	''Future Owners Program'', a Group initiative to select talented young employees who will be placed on a professional fast-track program, thus enhancing their development and growth;
―	"Agility Community": launch of the first Agility Community at GIA & WM BU level, with representatives of all the main legal entities; based on the results of the 2019 Engagement Survey and the four pillars of the Agile transformation (structure, people, processes and technology), the Community identified 23 Agile initiatives, of which six have already been completed and the remaining launched in 2020 and currently in course.

RESEARCH AND DEVELOPMENT ACTIVITIES

Special attention was paid during the year to the rationalisation of the product offer to customers and the usual research activity aimed at creating new investment products was carried out. For more details, please refer to the information already provided in the section on business activities.

MAIN RISKS AND UNCERTAINTIES

The main risks to which company is exposed, as well as the actions implemented to mitigate them, are presented in the Explanatory Notes, Part D, Section 3, to which we refer.

As regards in particular the Covid-19 pandemic, it has been an element with a strong social and economic impact all over the world.

The Company, like the others in the Generali Group, has promptly implemented a series of initiatives to ensure business continuity and to protect the health of the people who work for the Company and the Group and of the customers.

First of all, a special "Crisis Committee" was activated as required by the "Business Continuity" plans. The Committee, through the analysis of all the evidence available in the meetings held from time to time, identified some priority actions along the following lines:

―	protection of people: promotion of smartworking as standard working mode (5 out of 5 working days), stringent protocols to access company offices and their sanitation, suspension of business trips, special training courses for employees to safely manage the work activity during the pandemic, etc.;
―	more stringent monitoring of financial risks to limit losses in managed portfolios: special measurement of exposure to specific risk factors (e.g. exposure to sectors particularly affected by the pandemic and restrictive measures, liquidity risk, credit risk, etc.) and creation of one-off investment committees to better address management decisions in the light of the unpredictable scenario;
―	special analysis and assessment of operational risks deriving from the contingent situation (e.g. IT security risks, technological capacity, operational continuity, etc.) and adoption of mitigation measures, such as strengthening of the IT network, internal analysis of business continuity on the main service providers/outsourcers (technology and other), etc.

RELATIONS WITH GROUP COMPANIES

The Company is 100% owned by Generali Investments Holding S.p.A., which in turn is directly and indirectly owned by Assicurazioni Generali S.p.A.

As at 31 December 2020, the Company had no holdings in subsidiary or associated companies.

In 2020 the Company continued to carry out transactions with the Parent Company, Assicurazioni Generali S.p.A. and with other Group companies settled at normal market conditions.

Among the most significant instances of intra-group relations, the following should be mentioned:

―	the collective portfolio management carried out by our Company for the investment portfolios and open pension funds of the Parent Company, and the main insurance companies of the Group in Italy, France, Germany, Spain, Portugal, Austria, Switzerland and Greece;
―	service activities by the Parent Company, the Holding Company and by some Group sub-holdings and foreign insurance companies for several centralised functions (compliance, internal audit, external communications, managerial development and remuneration systems, corporate affairs management, legal and tax consulting, trade union relations, safety at the workplace, planning, staff selection and recruitment, personnel training and development policies and plans, privacy and anti-money laundering, IT, back-office management);
―	service activities by and for the Holding Company, Generali Investments Holding S.p.A. and Generali Investments Partners S.p.A. for the commercial and marketing development activities, general accounting, tax fulfilments, execution of orders and research, human resources management, Risk Management, IT services, and investment stewardships;
―	service activities by the Group services companies (G.B.S. - Generali Business Solutions S.C.p.A., G.S.S - Generali Shared Services S.c.a.r.l., GDS - Generali Deutschland Services Gmbh, GDIS -Generali Deutschland Informatik Services Gmbh etc.) for administrative and accounting management, management of the purchases of goods and services and logistics, management of the communications network and IT services, both hardware and software;
―	bank current account contracts (Banca Generali S.p.A.) and direct cash-pooling contracts with Assicurazioni Generali S.p.A.

None of these transactions could be characterised as atypical or extraneous to the performance of the Company's core business.

As a result of transactions of different types with the Parent Company and the other Group companies, the Company incurred costs equal to about €66,8 million and received revenues and refunds equal to about €227.1 million. Please refer to the content of the specific section in the Explanatory Notes for further details on the type and counterparties of these transactions.

OTHER INFORMATION ON THE COMPANY

Treasury shares

The Company does not hold, and has never held, treasury shares or shares of its holding company or shares of the Parent Company, Assicurazioni Generali S.p.A.

GOVERNANCE AND APPOINTMENTS

On 16 April 2020, the Ordinary Shareholders' Meeting of the Company appointed, for the 2020-2022 period, the following members of the Board of Directors of the Company:

―	Santo BORSELLINO
―	Maurizia CECCHET
―	Francesco Benedetto MARTORANA
―	Mirella PELLEGRINI
―	Daniel ROY
―	Bruno SERVANT

with Santo BORSELLINO as Chairman of the Board of Directors.

The same Shareholders' Meeting appointed, for the 2020-2022 period, the following members of the Board of Statutory Auditors:

―	Angelo VENCHIARUTTI as Chairman of the Board of Statutory Auditors
―	Giuseppe ALESSIO VERNI' as Standing Auditor
―	Tazio PAVANEL as Standing Auditor
―	Maria Maddalena GNUDI as Alternate Auditor
―	Nicola SERAFINI as Alternate Auditor

The Board of Directors of the Company, which met at the end of the Shareholders' Meeting in question, appointed Francesco Benedetto MARTORANA as Chief Executive Officer and Mirella PELLEGRINI as independent director.

SUBSEQUENT EVENTS AND BUSINESS OUTLOOK

No events requiring an adjustment of the figures presented in the Financial Statements as at 31 December 2020 occurred after the end of the financial year.

On 7 January 2021, the transfer of Cattolica Assicurazioni's assets under management was completed, equal to €8.2 billion.

The Board of Directors of the Company, in the meeting on 24 February 2021 :

―	acknowledged the resignation of Francesco Benedetto MARTORANA, effective 1 March 2021, from the office of Chief Executive Officer, without prejudice to his position as Director of the Company, related to his taking a new position in the Parent Company Assicurazioni Generali S.p.A.;
―	appointed Bruno SERVANT as Chief Executive Officer of the Company, effective 1 March 2021 until the natural expiry of the mandate for the entire Board.

The Board of Directors of the Company will be integrated, following the identification of an additional Independent Director, by Evi Christine Vogl. Ms Vogl will be formally appointed by the Shareholders' Meeting of the Company called, among other things, to approve the financial statements for the 2020 financial year.

PROPOSAL FOR APPROPRIATION OF PROFITS

The Financial Statements as at 31 December 2020, here submitted for your approval, show net profits of €114,149,837: as the Legal Reserve has already reached the limit set by Art. 2430 of the Italian Civil Code, we propose the following allocation:

- a dividend of €1,805.00 per share to the 60,085 shares for a total of	€108,453,425
- to the Retained Earnings Reserve	€5,696,412

On approval of this proposal, the shareholders' equity of the Company would be as follows:

- Share capital	€60,085,000
- Share premium	€53,033,279
- Legal reserve	€12,017,000
- Profit reserves and other income reserves	€76,740,544
- Valuation reserves	- €87,977,753
- TOTAL SHAREHOLDERS' EQUITY	€113,898,070

The amount of the shareholders' equity complies with the prudential capitalisation ratios set by the supervisory regulations issued by the Bank of Italy for asset management companies.

Trieste, 31 March 2021

Board of Directors

BALANCE SHEET

(in units of €)

ASSETS

		as at 31/12/2020	as at 31/12/2019
10.	Cash and cash equivalents	47	47
20.	Financial assets measured at fair value through profit or loss	38,561,885	56,014,316
c)	other financial assets that must be measured at fair value	38,561,885	56,014,316
30.	Financial assets measured at fair value through other comprehensive income	0	0
40.	Financial assets measured at amortised cost	227,492,478	177,641,324
70.	Equity investments	0	40,491
80.	Tangible assets	13,345,199	16,986,904
90.	Intangible assets	27,850,293	37,118,470
100.	Tax assets	10,386,131	21,935,561
a)	current	1,459,543	12,980,060
b)	deferred	8,926,588	8,955,501
120.	Other assets	5,544,474	17,719,244
	TOTAL ASSETS	323,180,507	327,456,357
LIABILITIES AND SHAREHOLDERS' EQUITY
		as at 31/12/2020	as at 31/12/2019
10.	Financial liabilities measured at amortised cost	14,282,221	18,963,643
a)	Payables	14,282,221	18,963,643
60.	Tax liabilities	7,270,713	17,694,449
a)	current	6,646,189	17,074,697
b)	deferred	624,524	619,752
80.	Other liabilities	49,847,269	51,944,477
90.	Staff severance indemnities	2,643,563	2,930,565
100.	Provisions for risks and charges	26,785,246	45,095,400
b)	pensions and similar obligations	10,775,921	9,568,434
c)	other provisions for risks and charges	16,009,325	35,526,966
110.	Share capital	60,085,000	60,085,000
140.	Share premiums	53,033,279	53,033,279
150.	Reserves	83,061,132	67,365,083
160.	Valuation reserves	-87,977,753	-87,170,162
170.	Profit (loss) for the year	114,149,837	97,514,623
	TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	323,180,507	327,456,357

INCOME STATEMENT

(in units of €)

INCOME STATEMENT		as at 31/12/2020	as at 31/12/2019
10.	Commission income	275,284,541	260,449,479
20.	Commission expense	-1,231,826	-1,823,490
30.	NET COMMISSIONS	274,052,715	258,625,989
50.	Interest income and similar revenues	-27,883	-125,188
60.	Interest expense and similar charges	-423,144	-372,494
100.	Net income from other financial assets and liabilities measured at fair value through profit	-620,934	564,323
a)	financial assets and liabilities designated at fair value	0	31,287
b)	other financial assets that must be measured at fair value	-620,934	533,036
110.	GROSS OPERATING MARGIN	-1,071,961	66,641
120.	Net impairment/impairment reversal due to credit risk of:	-496,207	22,765
a)	financial assets measured at amortised cost	-496,207	22,765
130.	NET INCOME FROM FINANCIAL MANAGEMENT	272,484,547	258,715,395
140.	Administrative expenses:	-112,212,830	-122,840,853
a)	staff costs	-30,936,908	-35,983,549
b)	other administrative costs	-81,275,922	-86,857,304
150.	Net allocations to provisions for risks and charges	-575,806	-478,861
160.	Net impairment/impairment reversal on tangible assets	-2,990,226	-3,047,554
170.	Net impairment/impairment reversal on intangible assets	-7,942,380	-4,022,857
180.	Other operating income and charges	16,379,300	13,871,496
190.	OPERATING COSTS	-107,341,942	-116,518,629
200.	Profits/(Losses) on equity investments	0	0
210.	Net income on fair value measurement of tangible and intangible assets	0	0
220.	Goodwill impairment	0	0
230.	Profit (loss) from disposal of investments	-9,525	0
240.	PRE-TAX PROFIT (LOSS) FROM CONTINUING OPERATIONS	165,133,080	142,196,766
250.	Income taxes for the year on continuing operations	-50,983,243	-44,682,143
260.	PROFIT (LOSS) FROM CONTINUING OPERATIONS AFTER TAX	114,149,837	97,514,623
280.	PROFIT (LOSS) FOR THE YEAR	114,149,837	97,514,623

EXPLANATORY NOTES

Part A - ACCOUNTING POLICIES

A.1 General part

Section 1 - Declaration of conformity with international accounting standards

The figures of these financial statements were calculated based on the IAS/IFRS international accounting standards issued by the International Accounting Standard Board (IASB), as approved by the European Commission pursuant to European Community Regulation No. 1606 of 19 July 2002, applicable in the case in point.

In preparing the financial statements, the IAS/IFRS standards in force as at 31 December 2020 (including the SIC and IFRIC interpretation documents) as approved by the European Commission were applied. In drawing up the financial statements, no exceptions were made to the application of IAS/IFRS accounting standards. However, it should be noted that IFRS 8 "Operating segments" and IAS 33 "Earnings per share" were not applied because they are required for listed companies only.

It is reported that after the approval procedure was completed, dating from 1 January 2020, a number of amendments to the IAS/IFRS international accounting standards and to the existing IFRIC interpretation documents have been adopted, and new interpretation documents have also been issued.

New documents issued by the IASB and approved by the EU to obligatorily be adopted starting from financial statements of years commencing on 1 January 2020

There are no regulations approving new international accounting standards which provide for their entry into force from 1 January 2020.

After the approval procedure was completed, dating from 1 January 2020, a number of amendments to the IAS/IFRS international accounting standards and to the existing IFRIC interpretation documents have been adopted, and new interpretation documents have also been issued.

Amendments to the international accounting standards approved by the EU in previous year, effective 1 January 2020

Document title	Issue date	Effective date	Approval date	EU regulation and date of publication
Amendments to references to Conceptual Framework in the IFRS	29 March 2018	1 January 2020	29 November 2019	(EU)2019/2075 6 December 2019
Amendments to IAS 1 and IAS 8: Definition of material	31 October 2018	1 January 2020	29 November 2019	(EU) 2019/2104 10 December 2019

Amendments to the international accounting standards approved by the EU in 2020, effective 1 January 2020

Document title	Issue date by IASB	Effective date of IASB document	Approval date	EU regulation and date of publication
Amendments to IFRS 3: definition of a company activity	22 October 2018	1 January 2020	21 April 2020	(EU)2020/551 22 April 2020
Amendments to IFRS 9, IAS 39 and IFRS 17: Interest rate benchmark reform	26 September 2019	1 January 2020	15 January 2020	(EU)2020/34 16 January 2020
Amendments to IFRS 16: concessions on fees related to COVID-19	28 May 2020	1 June 2020	9 October 2020	(EU)2020/1434 12 October 2020

Amendments to the international accounting standards approved by the EU in 2020, effective 1 January 2021

Document title	Issue date by IASB	Effective date of IASB document	Approval date	EU regulation and date of publication
Amendments to IFRS 4 and IFRS 9: extension of the temporary exemption	June 2020	1 January 2021	15 December 2020	(EU)2020/2097 16 December 2020
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4, IFRS 16: Interest rate benchmark reform	August 2020	1 January 2021	13 January 2021	(EU)2021/25 13 January 2021

Amendments to international accounting standards not yet endorsed by the EU as of 13 January 2021

Document title	Issue date by IASB	Effective date of IASB document	Date of expected endorsement by EU
Principles
IFRS 17 Insurance Contracts, including subsequent events	May 2017 - June 2020	1 January 2023	To be decided
Changes
Reference to the Conceptual Framework (amendments to IFRS 3)	May 2020	1 January 2022	To be decided
Property, plant & equipment: proceeds before intended use (amendments to IAS 16)	May 2020	1 January 2022	To be decided
Onerous contracts: cost of fulfilling a contract (amendments to IAS 37)	May 2020	1 January 2022	To be decided
Annual improvements to IFRS Standards (cycle 2018-2020)	May 2020	1 January 2022	To be decided
Classification of Liabilities as Current or Non-current (Amendments to IAS 1), including subsequent amendments	January 2020 - July 2020	1 January 2023	To be decided

The effective date for some new standards already endorsed was postponed to subsequent years. The early application option was not exercised for these standards.

The standards and interpretations that came into force in 2020 did not have a material effect on the Company's equity and on its economic balances. It should be noted that the Company has not applied, as they are not applicable, the amendments to IFRS 16 for fee concessions connected with COVID-19.

Section 2 - General preparation principles

These financial statements consist of the Balance Sheet, the Income Statement, the Statement of Comprehensive Income, the Statement of Changes in Shareholders' Equity, the Cash Flow Statement and the Explanatory Notes. They have also been completed with the Directors' Report on Operations.

The formats used and the notes comply with the provisions in the "Financial statements of IFRS intermediaries other than banking intermediaries" issued by the Bank of Italy on 30 November 2018 to implement Italian Legislative Decree No. 136 of 18 August 2015.

The items and sections not carrying values for the current period and for the previous year have been omitted. Unless otherwise indicated, all amounts are stated in units of Euro.

These financial statements have been drafted with clearness and represent the state of affairs, the financial position and the result of the period in a true and fair view.

They match the Company's accounts, which fully reflect the transactions initiated during the year, and were drawn up by applying the basic principles contained in the accounting principles of reference, and in particular:

―

the accrual basis: the effect of the events and transactions is accounted for when they take place, and not when the correlated financial effects materialise;

―

the principle of going concern: the financial statements are prepared with the reasonable expectation that the Company will continue with its operational existence in a foreseeable future and, consequently, it has been prepared in this perspective of continuity. No symptoms are currently reported in the equity and financial structure and in the operating trend, which could lead to uncertainties regarding the continuity of the business. In recognising the operational transactions in the accounting records, importance was given to the principle of economic substance rather than that of form.

Finally, this document was properly supplemented with additional information, also in tabular form, to ensure a more complete and meaningful understanding of the Company's state of affairs.

The values of the balance sheet and income statement for 2020 and the previous year indicated in comparison were defined using the same valuation criteria.

Section 3 - Events subsequent to the reporting date

No events requiring an adjustment of the figures presented in the Financial Statements as at 31 December 2020 occurred after the end of the financial year.

Section 4 - Other aspects

The Company falls within the scope of consolidation of Assicurazioni Generali S.p.A., which draws up and publishes the consolidated Group financial statements based on the IAS/IFRS international accounting standards.

Business continuity and the COVID-19 pandemic

As already indicated in Section 2, the financial statements were prepared on the assumption of full business continuity of its operating activities in the foreseeable future also in the context of the foreseeable evolution of the current situation of the health crisis due to COVID-19. As more fully described in Section 3 of the Explanatory Notes, the Company has implemented a series of measures to monitor any impacts on its operations and in the meantime no situations have been identified that could presage a significant deterioration of its business continuity.

Use of estimates and assumptions in preparing the financial statements

Preparation of the financial statements may also require use of estimates and assumptions that may lead to significant effects on the values entered into the balance sheet and income statements, as well as on the information on the potential assets and liabilities reported in the financial statements. Working out these estimates entails using information available and adopting subjective valuations, also founded on experience of the past, used to draw reasonable assumptions for recognising operational transactions. Owing to their nature, the estimates and assumptions used may change from year to year, so the current values recorded in the financial statements may even significantly differ in the years to come following a change in the subjective valuations used.

The main cases in point for which corporate management is mostly required to use subjective valuations are:

―	measurement of the fair value of the financial instruments to use in the financial statements;
―	quantification of the employee benefit funds and the provisions for risks and charges;
―	estimates and assumptions on recoverability of the deferred tax assets.

There are no significant impacts deriving from the COVID-19 pandemic that could affect the calculation of these estimates.

The description of the accounting policies applied to the main balance sheet aggregates provides the information details necessary for identifying the chief subjective assumptions and valuations used in the drafting of the financial statements. The reader is instead referred to the specific sections of the Explanatory Notes for further detailed information pertaining to the composition and relevant recognition values of the items affected by the estimates in question.

A.2 Part regarding the main items of the Financial Statements

The recognition, classification, valuation and derecognition criteria adopted for the main financial and economic aggregates are explained below.

Financial assets measured at fair value through profit or loss

This category includes all financial assets not classified in the portfolio of financial assets measured at fair value through other comprehensive income and in the financial assets portfolio measured at amortised cost. This also includes investments in companies subject to significant influence or joint control that IAS 28 and IFRS 11 allow to be assigned to this portfolio. The item, in particular, includes:

―	financial assets held for trading essentially represented by debt securities, equity securities, loans, UCITS units and the positive value of derivative contracts held for trading purposes;
―	assets designated at fair value (debt securities and loans) with the valuation results recognized in the income statement based on the option granted to companies (so-called fair value option) by IFRS 9. In relation to this case, an entity can designate irrevocably to the recognition of a financial asset as measured at fair value through profit of loss if, and only if, by doing so it eliminates or significantly reduces a valuation inconsistency;
―	other financial assets that must be measured at fair value (debt securities, equity securities, UCITS units and loans), i.e. financial assets, other than those designated at fair value through profit or loss, which do not meet the requirements for classification at amortised cost, at fair value through other comprehensive income or which do not have a trading purpose.

In particular, they are classified in this portfolio:

―	debt instruments, securities and loans, the business model of which is neither held to collect nor held to collect and sell;
―	debt instruments, securities and loans, the cash flows of which do not represent only the payment of capital and interest;
―	UCITS shares/units;
―	equity instruments for which the Group does not apply the option granted by the principle of evaluating these instruments at fair value through other comprehensive income.

The initial recognition of financial assets takes place on the settlement date for debt securities, equity securities and UCI units, at the disbursement date for loans and at the date of subscription for derivative contracts. Upon initial recognition, financial assets measured at fair value through profit or loss are recognised at fair value, which normally corresponds to the amount paid, without considering transaction costs or revenues directly attributable to the financial instrument, which are charged to the income statement. After initial recognition, financial assets measured at fair value through profit or loss are measured at fair value, with changes being posted as a contra-entry to the income statement. For derivative instruments, if the fair value of a financial asset becomes negative, this item is recognised as a financial liability held for trading. In order to find the fair value of the financial instruments listed on an active market, market listings published as of the reference date of the financial statements will be used. In the absence of an active market, estimation methods and valuation models that take in consideration all risk factors correlated to the instruments and that are based on data that can be observed on the market will be used, such as: methods based on the valuation of listed instruments that have similar characteristics, calculations of discounted cash flows, option pricing calculation models, values observed in recent comparable transactions. For equity securities and related derivative instruments for which a reliable calculation of the fair value is not possible, the cost criterion is used as an estimate of the fair value only residually and limited to a few cases (inability to apply the methods mentioned above or in the event of a range of possible fair value calculations, among which the cost is the most significant estimate).

For methods to calculate the fair value, please refer to "Part A.4 - Information on fair value" below. Profits and losses from trading and capital gains and losses from valuation of the trading portfolio, including derivatives related to financial assets/liabilities designated at fair value, are recognised in the income statement under "70. Net income from trading activities"; the same economic effects relating to the financial assets designated at fair value and those that are that must be measured at fair value are recognised in item "100. Net income from other financial assets and liabilities measured at fair value through profit or loss". Financial assets are derecognised when the right to receive the cash flows from the financial asset ceases, or if all the risks and benefits associated with holding that asset are essentially transferred.

Financial assets measured at amortised cost

A financial asset is classified among financial assets measured at amortised cost if:

―	the objective of its business is the possession of activities aimed at collecting contractual financial flows ("held-to-collect");
―	the related cash flows represent only the payment of capital and interests.

The initial recognition of the financial asset takes place on the settlement date for debt securities and at the disbursement date for loans. Upon initial recognition, financial assets classified in this category are recognised at fair value, which normally corresponds to the amount paid, including any costs and income directly attributable to the instrument.

After initial recognition, the financial assets in question are measured at amortised cost, equal to the initial recognition value less capital repayments, reduced or increased by the depreciation - calculated using the effective interest rate method - of the difference between the amount disbursed and that repayable at maturity, typically attributable to the costs/revenues directly attributed to the single loan, taking into account that the cash flows relating to short-term receivables are not discounted if the effect of discounting is irrelevant. The book value of financial assets at amortised cost is adjusted to take into account any provision to cover expected losses. These losses are recognised in the income statement under item "120. Net value impairment/impairment reversal due to credit risk".

For assets consisting of trade receivables mainly from Group companies and bank deposits in current accounts, all prudently classified in Stage 2, the expected losses are calculated according to a collective process based on certain risk parameters represented by the probability of default (PD), the loss rate in the event of default (LGD) and the exposure value (EAD).

Should impaired assets emerge, they will be classified in Stage 3 and the impairment losses will be quantified based on an analytical assessment process aimed at determining the present value of the expected recoverable future flows and any interest will be quantified on the net value of these assets. Financial assets measured at amortised cost are derecognised from the assets when they are settled or all risks and benefits associated with them are basically transferred. On the other hand, if the risks and benefits relating to the assets have been maintained, they continue to be recognised as assets even though ownership of the asset has been transferred.

Equity investments

The item includes interests held in subsidiaries subject to joint control subjected to significant influence and those that are insignificant.

Subsidiaries are those companies in which the Company directly or indirectly owns more than half of the voting rights or when, although with a lower portion of voting rights, has the power to appoint the majority of directors of the investee or to establish its financial and operational policies. In measuring the voting rights, also the "potential" rights that can currently be exercised or converted into actual voting rights at any moment are considered.

Companies in which the Company jointly shares, directly or indirectly, the voting rights and control of the economic activity of the investee with another party are considered jointly owned subsidiaries. Furthermore, a shareholding in which control of the economic activity and strategic guidelines of the investee is shared with other parties by virtue of contractual agreements, although without a joint share of voting rights, is defined as subject to joint control.

Companies in which at least 20% of the voting rights (including the "potential" voting rights) are held, directly or indirectly, or in which - although with a lower share of voting rights - one has the possibility to take part in establishing the financial and management policies of the investee by virtue of particular legal ties such as shareholders' agreements, are considered subject to significant influence.

Some interests higher than 20% in which the Company directly or indirectly holds only property rights on a portion of the yields of the investments, has no access to the management policies and can exercise governance rights limited to protecting capital interests are not considered subject to significant influence. The equity investments are valued at cost and are then adjusted if necessary due to impairment. If there is evidence that the value of an equity investment might have sustained impairment, the recoverable value of the same equity investment is estimated while bearing in mind the current value of the future cash flows that the equity investment may generate, including the final value of the investment's disposal.

If the recovery value is lower than the book value, the difference is recognised on the income statement If the reasons for the impairment are removed following an event after the reduction in value has been recognised, impairment reversal are made with allocation to the income statement, which cannot exceed the amount of the impairment recognised previously.

Tangible and intangible assets

Tangible assets are recognised when it is likely that they will generate future economic benefits and the cost can be reliably calculated. They include plant, fixtures and furnishing and equipment of any kind held to be used to provide services or for administrative purposes, and believed to be used for more than one financial year. Tangible assets also include the value of the right of use of the moveable and immoveable assets obtained under operating leases or lease as set forth in IFRS 16. The current value of the future commitments for rentals or leases is recognised under the item financial liabilities valued at amortised cost. Intangible assets are identifiable assets without physical consistency that are held to be used over the long term. They comprise perpetual licences, software developed internally and software purchased from third parties.

Tangible and intangible assets are recognised at cost less the total accumulated amounts of amortisation and depreciation and impairment.

Tangible and intangible assets are systematically depreciated and amortised in constant quotas throughout their useful lives. The amortisation/depreciation process begins when the asset is available and ready for use, or when it is in the place and conditions necessary to operate.

Fixed assets are derecognised when they are discontinued or when they are permanently withdrawn from use and, as a result, future economic benefits deriving from their transfer or use are not expected. Capital gains and losses from divestment or disposal of tangible assets are calculated as the difference between the net disposal consideration and the book value of the asset, and they are recognised in the income statement on the same date on which they are derecognised from the accounts.

Tax assets and liabilities

Income tax, calculated in compliance with national regulations in force, is recognised on an accrual basis, and therefore represent the balance of current taxes and those prepaid or deferred regarding the income of the year.

Current tax assets and liabilities include the net balance between the liabilities calculated based on a prudential forecast of the tax charges due for the year and the assets represented by the advances, the withholdings and the other tax credits.

The prepaid and deferred tax assets and liabilities are calculated based on the time differences between the book value assigned to an asset or liability and the corresponding values taken for tax purposes. If the component that gives rise to the difference has affected the income statement, the contra-entry of the prepaid or deferred tax is represented by the income tax item, while if the component directly affected the shareholders' equity, also the relevant prepaid or deferred tax effect is directly charged to shareholders' equity. The current and deferred tax assets are recognised to the extent in which there is a probability of their recovery, which is measured based on the Company's ability to continuously generate sufficient taxable income. When there are tax losses that can be carried forward or unused tax credits, deferred tax assets are recognised to the extent in which it is probable that a future taxable income will be available against which the above-mentioned tax losses or unused tax credits can be used.

The assets and liabilities recorded for prepaid or deferred taxes are calculated by applying the tax rates expected to be applicable in the year in which the asset will be realised, based on the tax rates and tax regulations in force, or in force to all intents and purposes, at the date the year ends.

Financial liabilities measured at amortised cost

Financial liabilities measured at amortised cost include payables, whatever their technical form, other than those included in the items "Financial liabilities held for trading" and "Financial liabilities measured at fair value". Variation margins with clearing houses for transactions on derivative contracts are included. Debts connected with the provision of financial activities and services as defined by the Consolidated Law on Banking and the Consolidated Law on Finance are included. This item also includes the securities issued, valued at the amortised cost.

Payables are initially recognised at their fair value, usually corresponding to the amount to be settled, to which any directly allocated transaction costs/income are added if they are material and calculable.

Payables are afterwards measured at amortised costs, considering that the cash flows regarding short-term payables are not discounted if the discounting is irrelevant.

Financial payables are derecognised when they become past due or are settled.

Staff severance Indemnities

The liability connected with staff severance indemnities can be classified according to IAS 19 "Revised" as a post-employment benefit of the "defined benefit plan (DBP)" type, so it undergoes an actuarial valuation by using a method known as "PUCM - Projected Unit Credit Method" expressly reported in paragraphs 67 - 71 of "Revised" IAS 19.

According to this methodology, the amount of the staff severance indemnities already accrued is projected into the future to estimate the amount to be paid when the employment ends based on a series of variables that are both demographic (such as gender, date of birth, mortality rate, disability rate, etc.) and economic-financial (growth rate of remuneration, future average inflation rate, discounting rate, etc.). The demographic assumptions used for the calculation are periodically re-examined to confirm their validity. The discounting rate used is calculated according to the principles of IAS 19, paragraph 83, taking the market yields of securities of primary companies as at the date of valuation as reference or, in the cases of insignificant markets, the yields of government securities. The liabilities recognised in the financial statements represent the expected effective value of benefit, the Defined Benefit Obligation (DBO). All actuarial gains and losses for the major causes of variability of the demographic and financial assumptions are recognised in a special shareholders' equity reserve.

Provisions for risks and charges

Provisions for risks and charges are liabilities of uncertain amount or due date that are recognised in the financial statements only if:

―	there is a present obligation (legal or implicit) or one that will probably arise in the future due to a past event;
―	disbursement of financial resources to meet the present or future obligation is probable;
―	it is possible to make a reliable estimate of the probable future disbursement.

The liabilities set aside are calculated based on the best current estimate of the charge expected for the financial disbursement tied to the obligation.

If the time deferment of the estimated charge becomes important, the amount of the provision is adjusted to reflect its current value as at the date of disbursement and the relevant increase is recorded as interest expense.

The current value is calculated using appropriate discounting rates to reflect the value of the money and the specific risks of each liability.

When use of financial resources to meet the obligation becomes improbable, the provision is reversed.

Long Term Incentive Plan

The long term loyalty and incentive plans for the key managers of the Generali Group, including some of Generali Insurance Asset Management SGR S.p.A., have, in short, these characteristics:

―	the duration is open-ended, and they are divided into duration cycles; in particular, regarding the 2020 Plan, of three non-rolling years, since every new cycle has to be approved by the Shareholders' Meeting of the Parent Company;
―	each cycle is connected with the targets of the three-year strategic plans; in particular, the 2020 Plan is tied to the 2020-2022 Three-Year Plan targets.

The incentives for achieving the 2020 Plan will be paid in full in shares issued by Assicurazioni Generali S.p.A. The 2020 Plan, which came into force following its approval by the Shareholders' Meeting of Assicurazioni Generali S.p.A. of 30 April 2020 (grant date), is divided into three tranches identified with three years, from 2020 to 2022 included. The minimum access thresholds, the targets and the conditions of the plan are announced at the beginning of the cycle for each one of its tranches. The total number of shares regarding each of the three years will be assigned at the end of the third year following the judgement on the actual achievement of the targets and not only those on an annual basis, but also on the three-year total, announced by the Board of Directors of Assicurazioni Generali S.p.A.

Since this is an incentive plan that exclusively provides for the payment through the assignment of shares for the achievement of specific objectives over a period of service of 3 years, it is represented in the financial statements based on the provisions of IFRS 2. In particular, the cost of the entire cycle is divided over the vesting period, conventionally established for a duration of 3 years starting from 1 January 2020 until 31 December 2022 and is recognised in an equity reserve. The cost for each year is therefore equal to the difference between the value of the reserve at the end of each year and that of the reserve at the beginning of the year.

Valuation reserves

This item includes valuation reserves relating to equity securities measured at fair value with an impact on comprehensive income, financial assets (other than equity securities) measured at fair value through other comprehensive income, hedging foreign investments, cash flow hedges, exchange rate differences from conversion, "individual assets" and discontinued operations, the portion of valuation reserves of equity investments valued at equity, to actuarial profits (losses) on plans at defined benefits, profits/losses connected to the change in one's creditworthiness in relation to the liabilities in fair value option.

Profit reserves and other equity reserves

The item particularly comprises:

―	retained earnings reserve;
―	profits or losses deriving from the application of the new IAS/IFRS (IFRS 1) standards;
―	consolidation reserves;
―	reserves set up in years previous to the one when the international accounting standards were adopted
―	in compliance with the Italian Civil Code and special laws, including the properties revaluation reserve.
―	real estate;

Any profits and losses due to significant errors and to changes in the accounting standards or in the estimates adopted are included (IAS 8).

Recognition of costs and revenues

Revenues for the supply of services are recognised in the financial statements at fair value, which usually corresponds to the consideration received, and are accounted in the period in which the services were supplied.

Revenues for the sale of goods are recognised at fair value, which usually corresponds to the consideration received in the case the risks and benefits connected with ownership were transferred to the purchaser. Interest and similar income and charges are recognised by applying the actual interest rate method. The costs are recognised in the income statement according to the accrual principle. In particular, the commission income and expense coming from the management activities are divided into the following categories:

―	asset management commissions, calculated daily on the quarterly average of assets at the end of the month;
―	incentive commissions on asset managements, calculated annually according to the provisions of the management contracts;
―	commissions on management mandates, calculated and collected according to the provisions of the contract with the delegating parties.

Commission income for other services pertains to legal and administrative consulting and consulting on investments of financial instruments provided to third parties based on agreements between the parties.

Business combinations between entities under common control

The business combination transactions between entities under common control do not fall within the field of application of international accounting standard IFRS 3, and neither are they regulated by other IFRSs. They are therefore defined by referring to the provisions contained in IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.

The IAS/IFRS in fact contain specific guidelines to follow if a transaction does not fall within the scope of IFRS, described in paragraphs 10-12 of IAS 8, which require the Directors to also take into account the most recent pronouncements of other regulatory bodies that use a similar conceptual structure for defining accounting principles.

To this regard, note that the Financial Accounting Standards Board (FASB) published an accounting rule regarding business combinations (FAS 141), which from various point of view is similar to IFRS 3 and unlike the latter, includes limited accounting guidelines concerning transactions under common control previously described in Accounting Principles Board (APB) Opinion 16 in the form of an appendix. This method (pooling of interest) requires that the assets and liabilities for the transactions of this type be recognised at historical (book) values of the aggregated companies instead of at the respective fair values without recognising goodwill.

This solution was adopted nationally in substance by Assirevi, with document OPI No. 1 regarding the accounting of the business combinations of entities under common control and OPI No. 2 concerning the accounting of mergers.

The "intragroup" combinations, or however those between entities under common control, within the Generali Group are therefore carried out based on the book value of the transferred entities. If the consideration paid for acquisition of the equity investment differs from the book value of the transferred entity in proportion to the goodwill recognised, the difference is charged to reduce the shareholders' equity of the purchasing company and the transaction is qualified in the same way as an extraordinary allocation of reserves. In an entirely similar way if an entity is transferred, the consideration received is directly posted to a shareholders' equity reserve of the same type, in substance, as a contribution of capital by the other group companies.

A.4 Disclosure on fair value

Generali Insurance Asset Management SGR S.p.A. follows the Fair value Policy of the Assicurazioni Generali S.p.A. Group, including assigning Fair value level 1, 2 and 3.

Qualitative disclosure

A.4.1 Fair value levels 2 and 3: measurement techniques and inputs used

The measurement techniques are used when a listed price is unavailable or it has to be adapted to the circumstances, and for which sufficient data are available to measure the fair value, maximising the use of the significant observable data and reducing use of non-observable data to a minimum.

Single or multiple measurement techniques may be advisable. If multiple measurement techniques are used to measure the fair value, the results must be assessed considering the reasonableness of the range of values highlighted by these results. A fair value measurement is the point inside this interval that is the most representative of the fair value considering the circumstances. The three measurement models most widely used are:

―	market approach: it uses the prices and other significant information generated by market transactions of assets and liabilities or identical or comparable (i.e. similar) groups of assets and liabilities;
―	cost approach: it reflects the amount that would be necessary at the moment to replace the service capability of an asset; and
―	income approach: it converts future amounts into the current value (i.e., discounted).
―	For the financial instruments classified in level 3, the main inputs used in the measurement techniques are usually volatility, interest rates, yield curves, credit, spreads, estimates on the dividend and exchange rates.

The main cases are:

―	Unlisted equity securities They are unlisted equity securities classified as Financial assets measured at fair value through profit or loss. Their fair value is calculated through the valuation methods described above or based on the Net Asset Value of the Company. These instruments are measured one by one using appropriate inputs, depending on the security, and therefore neither a sensitivity analysis nor an aggregate or non-observable inputs used would be indicative of the same measurement. Moreover, for some securities cost is considered a reasonable proxy of fair value, and therefore a sensitivity analysis is not applicable.
―	Unlisted UCITS units These are unlisted UCITS shares classified as Financial assets measured at fair value through profit or loss. Their fair value is basically provided by the directors of the Fund based on the net asset value of the same fund. The fair value of these investments is also strictly monitored by a team of professionals inside the Group. Since the assets described above, by their nature, are linearly sensitive to the changes in value of the underlying assets, the Group considers that, at a given change in the fair value of the underlying of these assets, their value incurs a similar change.
―	Due from banks and customers Considering their nature, amortized cost is generally considered a good approximation of fair value and therefore classified at level 3. If deemed appropriate, they are valued at market values, considering the observable inputs, and consequently classified at level 2.
―	Payables If available and if the market is defined active, the fair value is equal to the market price. The fair value is mostly calculated based on the income approach using the discounting techniques. If they are measured at amortised cost as an approximation of fair value, they are classified under level 3.

A.4.2 Valuation processes and sensitivity

Fair value is the price that would be received for the sale of an asset or that would be paid to transfer a liability in an ordinary transaction between the market participants on the valuation date (exit price). In particular, an ordinary transaction takes place in the main market or in the one most advantageous on the valuation date considering current market conditions.

Valuation at fair value requires that the transaction aimed at selling an asset or at transferring a liability take place either:

(a) in the main market for the asset or liability; or

(b) if there is no main market, in the market most advantageous for the asset or liability.

The fair value is equal to the market price if market information is available (e.g., trading levels regarding identical or similar instruments) in an active market, which is a market where the goods traded on the market are homogeneous, available buyers and sellers can usually be found at any time and prices can be used by the public.

If there is no active market, a valuation technique that must however maximise the observable inputs should be used.

If the fair value cannot be reliably calculated, the amortised cost is used as the best estimate for determining the fair value.

For measurement and disclosure purposes, the fair value depends on its unit of account, depending on whether the asset or liability is a stand-alone asset or liability, a group of assets or group of liabilities, or a group of assets and liabilities calculated in compliance with the relevant IFRSs. Nevertheless, in determining fair value the valuation should reflect its use if carried out combined with other assets.

With reference to non-financial assets, measurement of the fair value considers the possibility for the market participants to generate economic benefits through highest and best use, or through the sale of the asset to another market participant that would put it to highest and best use. The highest and best use considered must be physically possible and legally allowed bearing the financial feasibility in mind. Current use of a non-financial asset is usually considered the highest and best use, unless the market or other factors point out an alternative use that maximises the value of the asset.

Fair value for the liabilities is represented by the price paid to transfer the liabilities in an ordinary transaction in the main (or most advantageous) market on the valuation date under current market conditions (exit price). Measurement must always consider the credit rating of the issuer. If a listed price for transferring an identical or similar instrument is not available and the instrument is held by others as an asset, the measurement considers the prospect of a market participant that holds the identical instrument on the measurement date. A.4.3 Fair value hierarchy

Assets and liabilities measured at fair value are measured and classified according to the fair value hierarchy established by IFRS 13, which consists of three levels that can be assigned based on the observability of the inputs used in the corresponding valuation techniques used.

The fair value hierarchy levels are based on the type of input used in determining the fair value with valuation techniques that are suited to the circumstances, and for which there are enough data available to measure the fair value while maximising use of significant observable inputs and minimising use of non-observable inputs:

―	Level 1: these are listed (non-adjusted) prices observed on active markets for identical assets or liabilities that the Company can access on the valuation date.
―	Level 2: inputs other than the listed prices of Level 1 that are observable for the asset or liability, whether directly or indirectly (e.g., listed prices for assets or liabilities similar in active markets; listed prices for assets or liabilities identical or similar in inactive markets; inputs other than the listed prices that are observable for the asset or liability; market-corroborated inputs).
―	Level 3: valuation techniques for which the input data is not observable for the asset or liability, which reflect the assumptions that the market participants should use when they price the asset or liability, including the risk assumptions (of the model used and inputs used).

The entire fair value is classified in the hierarchy level corresponding to the one of the lowest significant input used for the measurement. Valuation of the significance of a given input for assigning the entire fair value requires a valuation, bearing specific factors of the asset or liability in mind.

A valuation at fair value calculated using a current value technique might be classified in Level 2 or Level 3, depending on the inputs that are significant for the entire measurement and the hierarchy level of the fair value in which these inputs have been classified.

If an observable input requires an adjustment using non-observable inputs, and these adjustments are material for the same valuation, the resulting measurement would be classified in the level attributable to the lowest level input used.

Adequate controls were put in place to monitor all the valuations, including those provided by third parties. If these controls show that the assessment cannot be considered as market corroborated, the instrument must be classified as level 3. In this case, the main inputs used in the measurement techniques are usually volatility, interest rates, yield curves, credit spreads, estimates on the dividend and exchange rates.

Transfers between levels are generally due to the changes in market activity and the observability of the inputs used in the valuation techniques to find the fair value of some instruments. The financial assets and liabilities are transferred from Level 1 to Level 2 when the liquidity and frequency of the transactions are no longer indicative of an active market. The contrary holds true for transfers from Level 2 to Level 1.

Quantitative disclosure

A.4.5 Fair value hierarchy

A.4.5.1 Assets and liabilities measured at fair value on a recurring basis: breakdown by fair value levels

	31/12/2020			31/12/2019
Financial assets/liabilities measured at fair value	L1	L2	L3	L1	L2	L3
1. Financial assets measured at fair value through profit or loss
a) financial assets held for trading
b) financial assets designated at fair value
c) other financial assets that must be measured at fair value		38,447,838	114,047		55,799,223	215,093
2. Financial assets measured at fair value through ' other comprehensive income	0	0	0	0	0	0
3. Hedging derivatives	0	0	0	0	0	0
4. Tangible assets	0	0	13,345,199	0	0	16,986,904
5. Intangible assets	0	0	27,850,293	0	0	37,118,470
Total	0	38,447,838	41,309,539	0	55,799,223	54,320,466
1. Financial liabilities held for trading	0	0	0	0	0	0
2. Financial liabilities designated at fair value	0	0	0	0	0	0
3. Hedging derivatives	0	0	0	0	0	0
Total	0	0	0	0	0	0

A.4.5.2 Annual changes in assets measured at fair value on a recurring basis (Level 3)

	Financial assets measured at fair value through profit or loss
	Total	of which: a) financial assets held for trading	of which: b) financial assets designated at fair value	of which: c) other financial assets that must be measured at fair value	Financial assets measured at fair value through other comprehensive income	Hedging derivatives
1. Opening balance	55,799,223	0	0	55,799,223	0	0
2. Increases
2.1 Purchases
2.2 Profits shown in:
2.2.1 Income statement of which: capital aains
2.2.2 Shareholders' equity
2.3 Transfers from other levels
2.4 Other increases
3. Decreases
3.1 Sales	17,351,385			17,351,385
3.2 Repayments
3.3 Losses recognised in:
3.3.1 Income statement of which: capital losses
3.3.2 Shareholders' equity
3.4 Transfers from other levels
3.5 Other decreases
4. Closing balance	38,447,838	0	0	38,447,838	0	0

	Tangible assets	Intangible assets
1. Opening balance	16,986,904	37,118,470
2. Increases
2.1 Purchases	36,111	198
2.2 Profits shown in:
2.2.1 Income statement of which: capital aains
2.2.2 Shareholders' equity
2.3 Transfers from other levels
2.4 Other increases	314,057	107,391
3. Decreases
3.1 Sales	9,526
3.2 Repayments
3.3 Losses recognised in:
3.3.1 Income statement of which: capital losses	2,990,226	7,942,380
3.3.2 Shareholders' equity
3.4 Transfers from other levels
3.5 Other decreases	992,121	1,433,386
4. Closing balance	13,345,199	27,850,293

A.4.5.4 Assets and liabilities not measured at fair value or measured at fair value on a non-recurring basis: breakdown by fair value levels

Assets/liabilities not measured at fair value or measured at fair	31/12/2020				31/12/2019
value on a non-recurring basis	BV	L1	L2	L3	BV	L1
1. Financial assets measured at amortised cost	0	0	98,954,382	128,538,096	0	0
2. Tangible assets held for investment	0	0	0	0	0	0
3. Non-current assets and discontinued operations	0	0	0	0	0	0
Total	0	0	98,954,382	128,538,096	0	0
1. Financial liabilities measured at amortised cost	0	0	0	14,282,221	0	0
2. Liabilities associated with discontinued operations	0	0	0	0	0	0
Total	0	0	0	14,282,221	0	0

Assets/liabilities not measured at fair value or measured at fair	31/12/2019
value on a non-recurring basis	L2	L3
1. Financial assets measured at amortised cost	61,344,830	116,296,493
2. Tangible assets held for investment	0	0
3. Non-current assets and discontinued operations	0	0
Total	61,344,830	116,296,493
1. Financial liabilities measured at amortised cost	0	3,328,974
2. Liabilities associated with discontinued operations	0	0
Total	0	3,328,974

Key

BV = Book value

L1 = Level 1

L2 = Level 2

L3 = Level 3

Part B - INFORMATION ON THE BALANCE SHEET

ASSETS

Section 1 - Cash and cash equivalents - Item 10

1.1 Breakdown of item 10 "Cash and cash equivalents"

The item includes only petty cash.

Section 2 - Financial assets measured at fair value through profit or loss - Item 20

2.5 - Other financial assets that must be measured at fair value: product composition

	31/12/2020			31/12/2019
Items / Values	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
1. Debt securities
1.1 Structured securities	0	0	0	0	0	0
1.2 Other debt securities	0	0	0	0	0	0
2. Equity securities	0	0	114,047	0	0	215,093
3. UCITS shares/units	0	38,447,838	0	0	55,799,223	0
4. Loans
4.1 Repurchase agreements	0	0	0	0	0	0
4.2 Others	0	0	0	0	0	0
Total	0	38,447,838	114,047	0	55,799,223	215,093

The decrease in item 2 is due to the sale during the year of the shareholding in the subsidiary GSS - Generali Shared Services S.C. a R.L.

The change compared to the previous year in item 3 is substantially due to sales during the year.

UCITS shares/units

Description	No. Shares	Share value as at 31/12/2020	Fair value as at 31/12/2020
SG MONETAIRE PLUS	282,338.00	100.21	28,293,965
GENERALI GELDMARKT EURO	172,348.00	58.68	10,113,381
G. ACTIONS INTERNATIONALES	1.00	36.00	36
GENERALI DYNAMISME	0.02	3,954.80	70
GIS SG MULA	0.77	101.10	78
GENERALI PRUDENCE	0.03	3,229.57	83
GF FIDELITE	1.00	118.00	118
GENERALI INVESTISSEMENT	1.00	119.00	119
FEDERATION EP	100.00	395.38	39,538
GFC GESTION DE FORTUNE	1.00	101.00	101
GIF ALPHA DIVERSIFIEE	0.38	918.42	349
Total UCITS snares/units	454,791.19		38,447,838

2.6 Other financial assets that must be measured at fair value: borrower/issuer composition

Items / Values	31/12/2020	31/12/2019
1. Equity securities
of which: banks	0	0
of which: other financial companies	0	0
of which: non-financial companies	114,047	215,093
2. Debt securities
a) Government agencies	0	0
b) Banks	0	0
c) Other financial companies	0	0
of which: insurance companies	0	0
d) Non-financial companies	0	0
3. UCITS snares/units	38,447,838	55,799,223
4. Loans
a) Government agencies	0	0
b) Banks	0	0
c) Other financial companies	0	0
of which: insurance companies	0	0
d) Non-financial companies	0	0
e) Families	0	0
Total	38,561,885	56,014,316

Item "1. Equity securities- Level 3" refer primarily to the interest in the capital of GBS, Generali Business Solution S.C.p.A., consortium specialised in providing IT and administrative services to the Assicurazioni Generali Group companies. Given that the purpose of the consortium is not the generation of profits but the provision of services to the Group at the lowest possible cost for the associated companies, it is considered, therefore, that the market value of the interest can be almost similar to their equity value.

Section 4 - Financial assets measured at amortised cost - Item 40

4.1 - Financial assets measured at amortised cost: product composition

	31/12/2020
	_{Book value}			Fair value
Detail / Values	First and second stage	Third stage	of which: impaired purchased or originated	Level 1	Level 2	Level 3
1. Receivables for asset management services
1.1 management of UCITS	11,146,310	0	0	0	0	11,146,310
1.2 individual management	111,058,545	0	0	0	0	111,058,545
1.3 pension fund management	0	0	0	0	0	0
2. Receivables for other servic
2.1 advisory services	85,000	0	0	0	0	85,000
2.2 company functions outsourced	2,617,796	0	0	0	0	2,617,796
2.3 others	2,442,462	0	0	0	0	2,442,462
3. Other receivables
3.1 repurchase agreements	0	0	0	0	0	0
of which: on government securities	0	0	0	0	0	0
of which: on other debt securities	0	0	0	0	0	0
of which: on equity securities and units	0	0	0	0	0	0
3.2 deposits and current accounts	98,954,382	0	0	0	98,954,382	0
3.3 others	1,187,983	0	0	0	0	1,187,983
4. Debt _sec u _ri t _ies	0	0	0	0	0	0
Total	227,492,478	0	0	0	98,954,382	128,538,096

	31/12/2019
	Book value			Fair value
Detail / Values	First and second stage	Third stage	of which: impaired purchase d or originated	Level 1	Level 2	Level 3
1. Receivables for asset management services
1.1 management of UCITS	32,310,653	0	0	0	0	32,310,653
1.2 individual management	70,036,569	0	0	0	0	70,036,569
1.3 pension fund management	0	0	0	0	0	0
2. Receivables for other servic
2.1 advisory services	20,000	0	0	0	0	20,000
2.2 company functions outsourced	8,894,917	0	0	0	0	8,894,917
2.3 others	2,251,824	0	0	0	0	2,251,824
3. Other receivables
3.1 repurchase agreements	0	0	0	0	0	0
of which: on government securities	0	0	0	0	0	0
of which: on other debt securities	0	0	0	0	0	0
of which: on equity securities and units	0	0	0	0	0	0
3.2 deposits and current accounts	61,344,830	0	0	0	61,344,830	0
3.3 others	2,782,531	0	0	0	0	2,782,531
4. Debt _sec u _ri t _ies	0	0	0	0	0	0
Total	177,641,324	0	0	0	61,344,830	116,296,494

Receivables for individual asset management services refer to commissions due from institutional customers that are mainly members of the Generali Group.

The amount under item 3.2 includes the sum of €62,999,294 deposited with the Parent Company, Assicurazioni Generali S.p.A. under the "direct cash-pooling" contract.

4.2 - Financial assets measured at amortised cost: borrower/issuer composition

	Banks		Financial companies		Customers
Composition/Counterparty		of which: of the Group of the SGR		of which: of the Group of the SGR		of which: of the Group of the SGR
1. Receivables for asset management
1.1 management of UCITS			10,399,566	2,983,571	161,674	161,674
1.2 individual management			23,436,429		88,207,185	85,551,927
1.3 pension fund management
2. Receivables for other services
2.1 advisory services					85,000	85,000
2.2 corporate functions outsourced			1,415,372	1,415,372	1,202,424	1,202,424
2.3 Other	2,488	2,488	2,212,411	3261562	227,564	213,570
3. Other receivables
3.1 repurchase agreements
- of which: on government securities
- of which on other debt securities
- of which: on equity securities
3.2 deposits and current accounts	35,955,088	7,072,631			62,999,294	62,999,294
3.3 other			1,187,983	1,187,983
4. Debt securities
Total 31/12/2020	35,957,576	7,075,119	38,651,761	8,848,488	152,883,141	150,213,889
Total 31/12/2019	26,346,346	4,191,498	30,867,313	3,951,329	120,427,665	114,586,637

4.3 - Financial assets measured at amortised cost: gross value and overall value adjustments

	Gross Value				Overall value adjustments
	Fir st ph as e	of whic h: Low	Se co nd ph as	Thi rd ph as e	Fir st ph as e	Se co nd ph as
Debt securities	0	0	0	0	0	0
Loans	0	0	0	0	0	0
Total 31/12/2020	0	0	0	0	0	0
Total 31/12/2019	0	0	0	0	0	0
of which: impaired, purchased or originated financial assets	0	0	0	0	0	0

	Overall value adjustments
	Thi rd ph as e	Overall partial write-off
Debt securities	0	0
Loans	0	0
Total 31/12/2020	0	0
Total 31/12/2019	0	0
of which: impaired, purchased or originated financial assets	0	0

Section 8 - Tangible assets - Item 80

8.1 - Tangible assets for business use: breakdown of the assets valued at cost

Assets / Values	31/12/2020	31/12/2019
1. Owned assets
a) Land	0	0
b) Buildings	0	0
c) Furniture	285,088	388,336
d) Electronic systems	27,921	19,296
e) Other	818,096	1,069,517
2. Rights of use acquired under leasing
a) Land	0	0
b) Buildings	12,019,794	15,403,122
c) Furniture	0	0
d) Electronic systems	0	0
e) Other	194,300	106,633
Total	13,345,199	16,986,904

8.5 - Tangible assets for business use: annual changes

	Land	Buildings	Furniture	Electronic systems	Other	Total
A. Opening gross balances	0	15,403,122	388,336	19,296	1,176,150	16,986,904
A.1 Total net losses in value	0	0	0	0	0	0
A.2 Opening net balances	0	15,403,122	388,336	19,296	1,176,150	16,986,904
B. Increases
B.1 Purchases	0	0	0	34,171	1,940	36,111
B.2 Expenditure for capitalised improvements	0	0	0	0	0	0
B.3 Impairment reversal	0	0	0	0	0	0
B.4 Increases in the fair value shown in
a) shareholders' equity	0	0	0	0	0	0
b) income statement	0	0	0	0	0	0
B.5 Positive exchange differences	0	0	0	0	0	0
Transfers from properties held for investment B.6 purposes	0	0	0	0	0	0
B.7 Other changes	0	113,444	0	0	200,613	314,057
C. Decreases
C.1 Sales	0	0	-9,526	0	0	-9,526
C.2 Amortisation	0	-2,539,587	-93,722	-25,546	-331,371	-2,990,226
C.3 Value adjustments from impairment shown in:
a) shareholders' equity	0	0	0	0	0	0
b) income statement	0	0	0	0	0	0
C.4 Decreases in the fair value shown in:
a) shareholders' equity	0	0	0	0	0	0
b) income statement	0	0	0	0	0	0
C.5 Negative exchange differences	0	0	0	0	0	0
C.6 Transfers to:
a) tangible assets held for investment	0	0	0	0	0	0
b) non-current assets and discontinued operations	0	0	0	0	0	0
C.7 Other changes	0	-957,185	0	0	-34,936	-992,121
D. Net closing balances	0	12,019,794	285,088	27,921	1,012,396	13,345,199
D.1 Total net losses in value	0	0	0	0	0	0
D.2 Gross closing balances	0	12,019,794	285,088	27,921	1,012,396	13,345,199
E. Valuation at cost	0	0	0	0	0	0

Section 9 - Intangible assets - Item 90

9.1 - Intangible assets: breakdown by asset type

	31/12/2020		31/12/2019
	Assets valued at cost	Assets measured at fair	Assets valued at cost	Assets measured at fair
1. Goodwill	0	0	0	0
2. Other intangible assets
2.1 Generated internally	0	0	914,674	0
2.2 Other	27,850,293	0	36,203,796	0
Total	27,850,293	0	37,118,470	0

Intangible assets mostly consist of development costs and software implementation of the SimCorp system.

9.2 - "Intangible assets: annual changes"

	Total
A. Opening balance	37,118,470
B, Increases
B.1 Purchases	198
B.2 Impairment reversal	0
B.3 Increases in the fair value
- to shareholders' equity	0
- to income statement	0
B.4 Other changes	107,391
C. Decreases
C.1 Sales	0
C.2 Amortisation	-7,942,380
C.3 Value adjustments
- to shareholders' equity	0
- to income statement	0
C.4 Decreases in the fair value
- to shareholders' equity	0
- to income statement	0
C.5 Other changes	-1,433,386
D. Closing balance	27,850,293

Section 10 - Tax assets and liabilities - Item 100 of Assets and Item 60 of Liabilities

10.1 - Current and prepaid tax assets: composition

Items / Values	31/12/2020	31/12/2019
Current tax assets
a) Receivables for direct taxes - branches	0	3,331,730
b) IRES receivables	1,459,543	9,648,330
Total	1,459,543	12,980,060
Deferred tax assets
c) IRES advance payments	8,819,121	8,834,601
d) IRAP advance payments	107,467	120,900
Total	8,926,588	8,955,501
Total tax assets	10,386,131	21,935,561

Current tax assets regarding IRAP advance payments were classified under item 60 "Tax liabilities" net of current tax liabilities.

The main items making up the deferred tax assets are summarised below:

―	for €447,176 they concern the deferred deductibility of the allocation for the risk provisions for legal disputes;
―	for €2,584,679 they concern deferred deductibility of the allocation for the variable remuneration portion of employees estimated as at 31 December 2020;
―	for €1,028,136 they concern the economic components recognised in the prior year by the French branch but that are tax deductible in the subsequent tax periods.

10.2 - Current and deferred tax liabilities: composition

Items / Values	31/12/2020	31/12/2019
Current tax liabilities
a) Direct tax liabilities - Branches	-4,690,256	4,802,437
b) IRAP liabilities for the year	-6,694,940	-6,009,933
c) less: advance payments made	6,020,204	6,080,767
d) IRES liabilities for the year	-1,281,197	-21,947,968
Total	-6,646,189	-17,074,697
Deferred tax liabilities
IRES deferred liabilities	-624,524	-619,752
Total	-624,524	-619,752
Total tax liabilities	-7,270,713	-17,694,449

10.3 - Change in deferred tax assets (as offsetting entry of the Income Statement)

	31/1 2/2020	31/12/2019
1. Opening balance	6,214,011	6,469,936
2. Increases
2.1 Deferred tax assets recognised during the year
a) relating to previous years	2,901,102	1,382,607
b) due to changes in accounting criteria	0	0
c) impairment reversal	0	0
d) other	0	0
2.2 New taxes or tax rate increases	0	0
2.3 Other increases	0	0
3. Decreases
3.1 Deferred tax assets derecognised during the year
a) reversals	-3,430,353	-1,638,532
b) impairment due to supervening non-recoverability	0	0
c) due to changes in accounting criteria	0	0
d) other	0	0
3.2 Reduction in tax rates	0	0
3.3 Other decreases
transformation into tax credits pursuant to Italian Law No. a) 214/2011	0	0
b) other	0	0
4. Final amount	5,684,760	6,214,011

The increases mainly refer to the deferred tax assets on charges for the year to the variable remuneration provision and the provision for risks, while the decreases are mainly due in the amount of €388,440 to the provisions for legal disputes and for €2,505,455 to the use of the variable remuneration provision of the previous year.

10.4 - Changes in deferred taxes (as offsetting entry of the income statement)

	31/12/2020	31/12/2019
1. Opening balance	0	145,471
2. Increases
2.1 Deferred taxes recognised during the year
a) relating to previous years	0	474,281
b) due to changes in accounting criteria	0	0
c) other	0	0
2.2 New taxes or tax rate increases	0	0
2.3 Other increases	0	0
3. Decreases
3.1 Deferred taxes cancelled during the year
a) reversals	0	0
b) due to changes in accounting criteria	0	0
c) other	0	0
3.2 Reduction in tax rates	0	0
3.3 Other decreases	0	0
4. Final amount	0	619,752

10.5 - Changes in deferred tax assets (as offsetting entry of the Shareholders' Equity)

	31/1 2/2020	31/12/2019
1. Opening balance	2,741,489	3,268,147
2. Increases
2.1 Deferred tax assets recognised during the year
a) relating to previous years	0	0
b) due to changes in accounting criteria	0	0
c) other	0	0
2.2 New taxes or tax rate increases	74,068	0
2.3 Other increases	0	0
3. Decreases
3.1 Deferred tax assets derecognised during the year
a) reversals	0	-526,657
b) impairment due to supervening non-recoverability	0	0
c) due to changes in accounting criteria	0	0
d) other	0	0
3.2 Reduction in tax rates	0	0
3.3 Other decreases	0	0
4. Final amount	2,815,557	2,741,490

Section 12 - Other assets - Item 120

12.1 - Other assets: composition

Other Assets	31/12/2020	31/12/2019
Receivables for IRES advance payments made	0	0
Receivables due from the Holding Company, for tax consolidation scheme	0	644,171
Prepaid expenses	643,281	454,271
Receivables due from tax authorities	1,801,194	9,298,245
Guarantees	15,212	15,212
Receivables due from social security and welfare institutions	10,882	9,409
Trade receivables	101,128	192,374
Receivables due from employees	299,084	219,447
Receivables for insurance policies	2,443,653	2,455,984
Other assets	230,040	4,430,131
Total	5,544,474	17,719,244

Prepayments mainly regard the costs of the data bases used for the management activity carried on by the Company.

Receivables from the tax authorities essentially relate to the VAT credit on purchases.

Receivables for insurance policies refer to the investment in a policy against the pension fund of German Branch employees.

LIABILITIES

Section 1 - Financial liabilities measured at amortised cost - Item 10

1.1 Financial liabilities measured at amortised cost: product composition of payables

Details/Values	31/12/2020	31/12/2019
1. Payables due to sales networks:
1.1 for UCITS placement activities
1.2 for ind. portf. placement activities
1.3 for pension fund placement activities
2. Payables for management activities:
2.1 for own portfolios	529,742	6,902
2.2 for portfolios under mandate
2.3 for other
3. Payables for other services:
3.1 advisory services		1,931,711
3.2 company functions outsourced	32,159
3.3 other	847,794	1,390,361
4. Other payables:
4.1 repurchase agreements
- of which: on government securities
- of which on other debt securities
- of which: on equity securities and units
4.2 Lease payables	12,580,701	15,634,669
4.3 Other payables	291,825
Total	14,282,221	18,963,643
Fair value - level 1
Fair value - level 2
Fair value - level 3	14,282,221	18,963,643
Total fair value	14,282,221	18,963,643

1.5 Financial liabilities measured at amortised cost - Payables: breakdown by counterparty

	Banks		Financial companies		Customers
Composition/Counterparty		of which: of the Group of the SGR		of which: of the Group of the SGR		of which: of the Group of the SGR
1. Payables due to sales networks!
1.1 for placement activities
1.2 for ind. portf. placement activities
1.3 for pension fund placement activities
2. Payables for management activities!
2.1 for own portfolios	95,690	95,690	431,873	431,873	2,179
2.2 for portfolios under mandate
2.3 for other
3. Payables for other services!
3.1 advisory services received
3.2 company functions outsourced			23,531		8,628
3.3 other	82,306		45,214		720,274	556,619
4. Other payables
4.1 repurchase agreements
- of which: on government securities
- of which on other debt securities
- of which: on equity securities and units
4.2 Lease payables					12,580,701	12,580,701
4.3 Other payables					291,825
Total 31/12/2020	177,996	95,690	500,618	431,873	13,603,607	13,137,320
Total 31/12/2019	140,045	10,194	0	0	18,823,598	17,776,660

The payable relating to the current value of the rentals of the leased assets is a consequence of application of the IFRS 16 accounting standard starting from this year.

1.6. Lease payables - Analysis of maturities

	Total 2020
	Lease payments to be made
Up to 1 year	1,516,293
From over 1 year up to 5 years	6,065,171
From over 5 years	4,999,237
Total	12,580,701

Section 6 - Tax liabilities - Item 60

Please refer to Section 10 of assets.

Section 8 - Other liabilities - Item 80

8.1 - Breakdown of item 80 "Other liabilities"

Other liabilities	31/12/2020	31/12/2019
Payables for IRES for the year
less: Receivables for IRES advance payments made
Payables to Holding Company, for tax consolidation scheme	0	0
Trade payables	28,372,374	28,346,958
Payables due to social security and welfare institutions	1,652,774	1,981,249
Payables due to personnel	3,118,436	3,295,588
Payables due to tax authorities	15,391,396	17,518,186
Other payables	1,312,289	802,496
Total	49,847,269	51,944,477

Since 2019, the Company no longer participates in the "national tax consolidation" of the Generali Group regulated by Art. 117-129 of the Consolidated Tax Act and introduced by Italian Legislative Decree 344/2003. Payables to the tax authorities include €13,507,285 for non-deductible VAT to be paid. All debit balances consist of liabilities with residual life of less than six months.

Section 9 - Staff severance indemnities - Item 90

This item corresponds to all liabilities with employees accrued as at 31 December 2020 in conformity with current legislation, net of the prepayments and payments already settled, and the amount paid to the supplementary funds. As the debt is defined, it is stated at year-end at its current value actuarially calculated as instructed in IAS 19 "Revised".

9.1 - "Staff severance indemnities": annual changes

	31/12/2020	31/12/2019
A. Opening balance	2,930,565	2,471,838
B, Increases
B.1 Allocations in the year	27,434	441,474
B.2 Other increases	0	17,253
C. Decreases
C.1 Payments made	-48,643	0
C.2 Other decreases	-265,793	0
D. Closing balance	2,643,563	2,930,565

9,2 Other information

The provision for the year is net of the share transferred to the supplementary social security and welfare provisions and includes €3,677 for interest costs.

Actuarial assumptions used to calculate the liability on the financial statements reference date are the following:

―	the "SI2017" mortality rate tables divided into genders and in a percentage of 100% for both males and females were used for the demographic assumptions;
―	for the disability assumptions, the INPS tables divided into genders and in a percentage of 50% for both males and females were used: this flat reduction was introduced to consider the lowest disability rate of the sector of reference;
―	economic and financial assumptions:

Staff severance indemnity base discounting rate as at 31/12/2020: 0.2257% average future inflation rate: 0.7% annual, constant pay revaluation: 1.8% annual, constant, for both senior managers and administrative staff.

The value of the staff severance indemnities calculated in application of Art. 2120 of the Italian Civil Code as at 31 December 2020 for personnel of the Italian offices is €507,868.

Section 10 - Provisions for risks and charges - Item 100

The allocations made, calculated based on the best current estimate of the potential future charges, regarded the following provisions, in detail:

10.1 "Provisions for risks and charges": composition

Items / Values	31/12/2020	31/12/2019
1. Funds on commitments and guarantees issued	0	0
2. Company pension funds	10,775,921	9,568,434
3. Other provisions for risks and charges
3.1 legal and tax disputes	1,879,731	3,955,500
3.2 charges for employees	12,349,994	12,214,496
3.3 others	1,779,600	19,356,970
Total	26,785,246	45,095,400

The provisions for pensions and similar obligations concern the pension treatment of the employees of the German branch. An insurance policy is stipulated against this liability, the value of which is reported under the item other assets.

The item in point 3.2 mainly relates to the estimate of the cost for variable compensation to employees for the year, in addition to the employee loyalty bonus fund, which accrues at the 25th and 35th year of service, calculated according to the dictates of the IAS 19 "Revised" considering the actuarial and financial assumptions indicated in Section 9.

The decrease in the amount in point 3.3 is substantially calculated by the settlement of the dispute with the Italian Tax Administration during the year, which has already been disclosed in previous financial statements.

10.2 "Company pension funds" and "Other provisions for risks and charges": annual changes

	Pens ion funds	Other provisions for risks and charges	Total
A. Opening balance	9,568,434	35,526,966	45,095,400
B. Increases
B.1 Allocations in the year	1,628,744	11,198,439	12,827,183
B.2 Changes due to the passing of time
B.3 Changes due to discount rate adjustments
B.4 Other changes			0
C. Decreases
C.1 Use during the year	-421,257	-24,941,769	-25,363,026
C.2 Changes due to discount rate adjustments
C.3 Other changes		-5,774,311	-5,774,311
D, Closing balance	10,775,921	16,009,325	26,785,246

The amounts indicated under items B.1 and C.1 of the Other provisions for risks and charges essentially refer to the provision and use for the payment of variable remuneration to employees. Item C.1 also includes the use of the provision previously set aside for the settlement of the dispute with the Italian Tax Administration referred to above.

Section 11 - Shareholders equity - Item 110, 140, 150 and 160

11.1 Breakdown of item 110 "Capital"

Type	Amount
1. Share capital
1.1 Ordinary shares	60,085,000
Total	60,085,000

The share capital consists of 60,085 ordinary shares having a par value of €1,000 for a total value of €60,085,000, and it is fully subscribed and paid up.

Generali Investments Holding S.p.A. owns 100% of the shares.

11.4 Breakdown of item 140 "Share premiums"

The share premium reserve remained unchanged compared to the previous year.

11.5 Other Information

11.5.1 Breakdown and changes in item 150 "Reserves"

	Legal reserve	Retained earnings	Other reserves	Total
A. Opening balance	12,017,000	50,222,362	5,125,721	67,365,083
B. Increases				0
B1. Allocation of earnings		15,510,615		15,510,615
B2. Other changes			185,434	185,434
C. Decreases				0
C1. Use				0
coverage of losses				0
distribution				0
transfer to capital				0
C2. Other changes				0
D. Closing balance	12,017,000	65,732,977	5,311,155	83,061,132

11.5.2 Breakdown and changes in item 160 "Valuation reserves"

	Fin. Assets at F.V. through other comprehensive income	Reserve for valuation of equity investments	Reserve under common control	Reserve for First Time Adoption Emplyee	Other reserves	Total
A. Opening balance	0	-9,256,945	-71,637,870	-365,777	-5,909,570	-87,170,162
B. Increases
Increases in the fair B.1 value	0	0	0	0	0	0
B.2 Other changes	0	0	0	0	0	0
C. Decreases
C.1 Decreases in the fair value	0	0	0	0	0	0
C.2 Other changes	0	0	0	142,087	-949,678	-807,591
D. Closing balance	0	-9,256,945	-71,637,870	-223,690	-6,859,248	-87,977,753

The reserve under common control consists of:

―	€24,977,152 regarding derecognition from the IAS/IFRS income statement of the capital gains made through the sale, to Banca Generali, of BG SGR shares received following transfer of the "retail" business unit to it, finalised with effect 1 January 2006;
―	- €59,077,130 regarding reversal of the deficit, net of tax effect, generated by the merger by incorporation of Prime Gest SGR S.p.A. and Prime Funds SGR S.p.A.;
―	- €4,990,709 for reversal of the goodwill of the value of the equity investments in Generali Thalia Investments Italy SGR S.p.A. (formerly Generali Investimenti Alternativi SGR S.p.A.) and Thalia SA.;
―	- €5,200,000 for the goodwill paid for acquisition of the BG SGR S.p.A. business unit;
―	- €6,900,000 for acquisition of the business unit of the affiliate Generali Investments Deutschland Gmbh during the year;
―	€1,203,496 due to the merger by incorporation of the affiliate Generali Investments France SA.;
―	€1,704,917 due to the sale of the equity investment Thalia S.A.;
―	- €161,088 due to the merger by incorporation of Generali Thalia Investments Italy SGR S.p.A.;
―	- €6,346,449 due to the merger by incorporation of the affiliate Generali Investments Deutschland;
―	- €15,807,401 as a decrease in shareholders' equity due to the spin-off in favour of Generali Investments Partners SGR S.p.A. and Generali Investments Holding S.p.A.

As required by Art. 2427, paragraph 7-bis of the Italian Civil Code, the table below analytically illustrates the Holdings items with information on their origin, possibility of use and distribution, and their actual use in previous years.

Origin, utilisation and availability for distribution of equity reserves

Nature / Description	31/12/2020	Availability for use ⁽¹⁾	Amount available	Summary of uses in previous three financial years
				to cover losses	for other reasons
Share capital	60,085,000
Capital reserves
Share premium reserve ⁽²⁾	53,033,279	ABC	53,033,279
Profit reserves
Legal reserve	12,017,000	B	12,017,000
Profit reserves of previous years	65,732,977	ABC	65,732,977
Reserve for payments - AG stock grant contribution	108,281	ABC	108,281
Long-Term Incentive Plan reserve	4,037,588
FTA IFRS 9 reserve	1,165,287
Other reserves
Valuation reserves
Duomo Project Merger Reserve	-15,807,401
Under common control: capital gain on transfer of business unit	24,977,152	B
Under common control: reversal of merger deficit ⁽³⁾	-59,077,130
Under common control: reversal of Fondi Alleanza merger deficit ⁽³⁾	-9,256,945
Under common control: reversal of goodwill on acquisition of equity investments ⁽³⁾	-4,990,709
Under common control: goodwill on acquisition of BG SGR business unit ⁽³⁾	-5,200,000
Under common control: goodwill on acquisition of GID business unit ⁽³⁾	-6,900,000
Under common control: GIF merger effect ⁽³⁾	1,203,496
Under common control: GID merger effect ⁽³⁾	-6,346,449
Under common control: effect of sale of Thalia S.A. ⁽³⁾	1,704,917
Under common control: merger deficit for Generali Thalia Investments Italy S p A SGR ⁽³⁾	-161,088
Other	-8,123,596
Total	108,201,659		130,891,537
Portion not available for distribution			12,017,000
Residual portion available for distribution			118,874,537

⁽²⁾ not available for distribution until the legal reserve has reached 1/5 of share capital
⁽³⁾ reserve not available pursuant to Art. 6 of Legislative Decree 38/2005
⁽¹⁾ Legend:
^A: for share capital increase
^B: to cover losses
^C: distribution to shareholders

TIME DISTRIBUTION OF ASSETS AND LIABILITIES

Residual durations	On demand	Up to 3 months	Up to 12 months	Up to 15 months	Up to 5 years	Undefined duration
ASSETS
Financial assets measured at fair value through profit of loss	38,447,838					114,047
Financial assets measured at amortised cost	98,954,382	128,538,096
Current tax assets			1,459,543
Deferred tax assets					8,926,588
Other assets		1,604,258	1,060,824			2,879,392
LIABILITIES
Financial liabilities measured at amortised cost		1,701,520	1,516,293		6,065,171	4,999,237
Current tax liabilities			6,646,189
Deferred tax liabilities					624,524
Other liabilities		26,593,552	23,253,717

Residual durations	Total
ASSETS
Financial assets measured at fair value through profit of loss	38,561,885
Financial assets measured at amortised cost	227,492,478
Current tax assets	1,459,543
Deferred tax assets	8,926,588
Other assets	5,544,474
LIABILITIES
Financial liabilities measured at amortised cost	14,282,221
Current tax liabilities	6,646,189
Deferred tax liabilities	624,524
Other liabilities	49,847,269

Part C - INFORMATION ON THE INCOME STATEMENT

Section 1 - Commission income and expense - Items 10 and 20

Commission income represents the revenues of the asset management for third parties and products offered by the Company according to the provisions of the mutual fund management regulations, the individual management contracts stipulated with the customers and the contracts regarding the management mandates. Commission expense represents the charges borne for the sales networks for placement of the products and the reimbursements to institutional investors.

1.1 - "Commission income and expense"

	31/12/2020			31/12/2019
SERVICES	Commission income	Commission expense	Net commissions	Commission income	Commission expense	Net commissions
A. PORTFOLIO MANAGEMENT
1. Own portfolios
1.1 Mutual funds
- Management fees	21,987,988	-64,563	21,923,425	39,899,490	-1,094,084	38,805,406
- Performance fees	1,856,066	0	1,856,066	0	0	0
- Subscription/reimbursement commissions	0	0	0	0	0	0
- Switch fees	0	0	0	0	0	0
- Other commissions	0	0	0	0	0	0
Total commissions of mutual funds	23,844,054	-64,563	23,779,491	39,899,490	-1,094,084	38,805,406
1.2 Individual portfolios
- Management fees	212,654,409	0	212,654,409	200,312,567	0	200,312,567
- Performance fees	68,512	0	68,512	852,948	0	852,948
- Subscription/reimbursement commissions	0	0	0	0	0	0
- Other commissions	0	-27,377	-27,377	0	-27,131	-27,131
Total commissions from individual portfolios	212,722,921	-27,377	212,695,544	201,165,515	-27,131	201,138,384
1.3 Open-ended pension funds
- Management fees	0	0	0	0	0	0
- Performance fees	0	0	0	0	0	0
- Subscription/reimbursement commissions	0	0	0	0	0	0
- Other commissions	0	0	0	0	0	0
Total commissions from open-ended pension funds	0	0	0	0	0	0
2. Portfolios under mandate
- Management fees	34,971,768	-7,654	34,964,114	17,168,397	-58,421	17,109,976
- Performance fees	95,477	0	95,477	2,148,672	0	2,148,672
- Other commissions	0	0	0	31,329	0	31,329
Total commissions from management under mandate	35,067,245	-7,654	35,059,591	19,348,398	-58,421	19,289,977
TOTAL COMMISSIONS FOR OWN PORTFOLIOS (A)	271,634,220	-99,594	271,534,626	260,413,403	-1,179,636	259,233,767
B. OTHER SERVICES
- Advisory services	577,500	-387,836	189,664	36,019	-182,138	-146,119
- Other services	62	-744,396	-744,334	57	-461,716	-461,659
TOTAL FEES OTHER SERVICES (B)	577,562	-1,132,232	-554,670	36,076	-643,854	-607,778
TOTAL COMMISSIONS (A+B)	272,211,782	-1,231,826	270,979,956	260,449,479	-1,823,490	258,625,989

1.2 - "Commission expense": breakdown by type and counterparty

	Banks		Financial companies		Other entities
Type / Counterparty		of which of the Group of the SGR		of which of the Group of the SGR		of which of the Group of the SGR
A. MANAGEMENT PORTFOLIO
1. Own portfolios
1.1 Placement commissions
- UCITS	0	0	0	0	0	0
- Individual portfolios	0	0	0	0	0	0
- Pension funds	0	0	0	0	0	0
1.2 Maintenance fees
- UCITS	0	0	0	0	0	0
- Individual portfolios	0	0	0	0	0	0
- Pension funds	0	0	0	0	64,563	0
1.3 Performance fees
- UCITS	0	0	0	0	0	0
- Individual portfolios	0	0	0	0	0	0
- Pension funds	0	0	0	0	0	0
1.4 Other commissions
- UCITS	0	0	0	0	0	0
- Individual portfolios	27,377	27,377	0	0	0	0
- Pension funds	0	0	0	0	0	0
Portfolios under 2, mandate
- UCITS	0	0	0	0	0	0
- Individual portfolios	0	0	0	0	0	0
- Pension funds	0	0	0	0	7,654	0
TOTAL COMMISSIONS FOR MANAGEMENT ACTIVITIES (A)	27,377	27,377	0	0	72,217	0
B. OTHER SERVICES
Advisory services	203,865	203,865	0	0	183,971	183,971
Other services	0	0	686,389	686,389	58,007	0
TOTAL COMMISSIONS FOR OTHER SERVICES (B)	203,865	203,865	686,389	686,389	241,978	183,971
TOTAL COMMISSIONS (A+B)	231,242	231,242	686,389	686,389	314,195	183,971

	Total
Type / Counterparty		of which of the Group of the SGR
A. MANAGEMENT PORTFOLIO
1. Own portfolios
1.1 Placement commissions
- UCITS	0	0
- Individual portfolios	0	0
- Pension funds	0	0
1.2 Maintenance fees
- UCITS	0	0
- Individual portfolios	0	0
- Pension funds	64,563	0
1.3 Performance fees
- UCITS	0	0
- Individual portfolios	0	0
- Pension funds	0	0
1.4 Other commissions
- UCITS	0	0
- Individual portfolios	27,377	27,377
- Pension funds	0	0
Portfolios under 2, mandate
- UCITS	0	0
- Individual portfolios	0	0
- Pension funds	7,654	0
TOTAL COMMISSIONS FOR MANAGEMENT ACTIVITIES (A)	99,594	27,377
B. OTHER SERVICES
Advisory services	387,836	387,836
Other services	744,396	686,389
TOTAL COMMISSIONS FOR OTHER SERVICES (B)	1,132,232	1,074,225
TOTAL COMMISSIONS (A+B)	1,231,826	1,101,602

Section 3 - Interest - Items 50 and 60

The income refers mainly to cash equivalents.

3.1 - Breakdown of "Interest income and similar revenues"

Item/Technical type	Debt securities	Repurchase agreements	Deposits and current accounts	Other transactions	Total 31/12/2020	Total 31/12/2019
Financial assets measured at fair value 1. through profit or loss:
1.1 Financial assets held for trading	0	0	0	0	0	2,671
1.2 Financial assets designated at fair value	0	0	0	0	0	0
Other financial assets that must be measured at 1.3 fair value	0	0	0	0	0	0
Financial assets measured at fair value through other 2. comprehensive income	0	0	0	0	0	0
3. Financial assets measured at amortised cost:						0
3.1 Receivables from banks	0	0	-48,602	20,719	-27,883	-146,598
3.2 Receivables from financial companies	0	0	0	0	0	0
3.3 Receivables from customers	0	0	0	0	0	0
4. Hedging derivatives	0	0	0	0	0	0
5. Other assets	0	0	0	0	0	18,738
6. Financial liabilities	0	0	0	0	0	0
Total	0	0	-48,602	20,719	-27,883	-125,189
of which: interest income on impaired financial assets	0	0	0	0	0	0

3.2 - Breakdown of "Interest expense and similar charges"

	Loans	Repurchase agreements	Securities	Other transactions	Total 31/12/2020	Total 31/1 2/2019
1. Financial liabilities measured at amortised cost
1.1 Payables	0	0	0	-329,749	-329,749	-262,185
1.2 Securities in issue	0	0	0	0	0	0
2. Financial liabilities held for trading	0	0	0	0	0	0
3. Financial liabilities designated at fair value	0	0	0	0	0	0
4. Other liabilities	0	0	0	93,395	93,395	-110,309
5. Hedging derivatives	0	0	0	0	0	0
6. Financial assets	0	0	0	0	0	0
Total	0	0	0	-236,354	-236,354	-372,494
of which: interest expense relating to lease payables	0	0	0	326,009	326,009	261,727

Section 7 - Net income from other financial assets and liabilities at fair value through profit or loss -Item 100

7.2 - Breakdown of the "Net income from other financial assets and liabilities measured at fair value" through profit or loss: other financial assets that must be measured at fair value

Items/Income components	Capital gains	Profits from sale	Capital losses	Losses from sale	Net income
1. Financial assets					0
1.1 Debt securities					0
of which Government securities					0
1.2 Equities			1,630		-1,630
1.3 UCITS shares/units			619,304		-619,304
of which: own UCITS					0
1.4 Loans					0
Financial assets in foreign currency! exchange 2.differences	X	X	X	X	0
Total	0	0	620,934	0	-620,934

Section 8 - Net value impairment/ impairment reversal for credit risk - Item 120

The amount corresponds to the estimated provision for the Expected Credit Losses (ECL) for Financial assets measured at amortised cost, all classified in Stage 2.

8.1 Composition of "Net value adjustments / impairment reversal for credit risk relating to Financial assets measured at amortised cost"

	Value adjustments			Impairment reversal
Items/Adjustments		Third phase				Total 31/12/2020
	First and second phase	Write-off			First and second phase
1. Debt securities	0	0	0	0	0	0
of which: Government	0	0	0	0	0	0
2. Loans	496,207	0	0	0	0	496,207
Total	496,207	0	0	0	0	496,207

Items/Adjustments	Total 31/12/2019
1. Debt securities	0
of which: Government	0
2. Loans	22,765
Total	22,765

Section 9 - Administrative costs - Item 140

Administrative costs include personnel costs and the other administrative and operating costs.

9.1 - Employee expenses: composition

Items / Sectors	Total 31/12/2020	Total 31/12/2019
1. Staff
a) wages and salaries	21,441,305	24,167,686
b) social security contributions	5,640,296	5,926,618
c) staff severance indemnities	1,013,678	1,253
d) social security expenses	1,792,935	2,085,430
e) allocation to provision for staff severance indemnity	491,815	905,479
f) allocation to provision for pension funds and similar obligations:		0
- defined contribution	0	0
- defined benefit	0	0
g) payments to external supplementary pension funds:		0
- defined contribution	0	0
- defined benefit	0	0
h) other employee benefits	1,236,612	2,526,296
2. Other personnel in service	26,014	31,996
3. Directors and Statutory Auditors	226,958	241,036
4. Retirements	0	0
5. Recovery of costs for employees seconded to other companies	-1,827,881	-1,381,048
6. Reimbursement of costs for employees seconded at the company	1,587,717	1,478,803
Total	31,629,449	35,983,549

9.2 Average number of employees broken down by category

	Workforce as at 31/12/2020	Workforce as at 31/12/2019	Weighted average 2020
Staff
Executives	19	19	16
Middle Managers	94	104	90
Other personnel	37	64	32
Total staff	150	187	138
of which seconded at third parties	5	2	4
Staff seconded from third parties
Executives	2	3	2
Middle Managers	5	5	4
Other personnel	3	1	2
Total seconded	10	9	8
General total	155	194	142
Atypical employment contract
Project workers	0	7	0
Temporary employment contract	3	8	1
Total atypical contracts	3	15	1
Total actual workforce	158	209	143

Details of the main cost items making up the "Other administrative costs" aggregate are provided below:

9.3 - Breakdown of item 140.b "Other administration costs"

Administrative costs	31/12/2020	31/12/2019
Consumables and utilities	137,695	157,991
Services and consulting	70,921,981	63,903,785
Commercial	13,903	79,360
Telephone and post	46,089	37,065
Leases and rental	4,251,938	5,286,960
Taxes and duties	4,934,833	15,548,235
Maintenance and repairs	0	1,496
Insurance	696,788	660,972
Travel, board and lodging expenses	145,541	1,007,901
Other expenses	127,154	173,538
Total	81,275,922	86,857,303

The item Taxes and duties includes €4,069,115 for the cost of non-deductible VAT.

The item Services and consulting includes, in addition to the cost of outsourced services described above, the costs for using data bases and the costs for administrative, IT and other services supplied by outsourced Generali Group companies.

Section 10 - Net provisions for risks and charges - Item 150

Please refer to what has already been described in Section 10 of the Liabilities - Item 100.

Section 11 - Net value impairment/ impairment reversal of tangible assets - Item 160

11.1 Breakdown of "Net value adjustments / impairment reversal of tangible assets"

Items/Net impairment/impairment reversal	Amortisation (a)	Value adjustments due to impairment (b)	Impairment reversal (c)	Net income (a + b - c)
1. For business use
- Owned	2,990,226	0	0	2,990,226
- Rights of use acquired under leasing	0	0	0	0
2. Held for investment
- Owned	0	0	0	0
- Rights of use acquired under leasing	0	0	0	0
Total	2,990,226	0	0	2,990,226

The value adjustments of owned assets consist only of the depreciation for the year calculated based on the following rates that are deemed representative of the useful life of the tangible assets:

11.1 BIS - Breakdown of the rates deemed representative of the useful life of the tangible assets

Tangible assets	Rates
Plant and machinery	20.00%
Equipment	20.00%
Electronic office machines	20.00%
Improvements to third party assets	16.66%
Furniture and fittings	12.00%

The adjustments to the value of the rights of use acquired under leasing consist of the amortization for the year calculated on a straight-line basis over the duration of the underlying contracts.

Section 12 - Net value impairment/ impairment reversal of intangible assets - Item 170

12.1 - Breakdown of "Net value adjustments / impairment reversal of intangible assets"

Itam/Net impairment/impairment reversal	Amortisation (a)	Value adjustments due to impairment	Impairment reversal (c)	Net income (a + b - c)
1. Intangible assets other than goodwill	0	0	0	0
owned	0	0	0	0
- generated internally	0	0	0	0
- other	7,942,380	0	0	7,942,380
rights of use acquired under leasing	0	0	0	0
Total	7,942,380	0	0	7,942,380

They represent the amortisation charge for the year. Software development and implementation costs are amortized at the rate of 20% per annum.

Section 13 - Other operating income and charges - Item 180

Other operating income and charges includes residual items of revenues and costs connected with the asset management and/or administrative activity.

13.1 - Breakdown of "Other operating income and charges"

Other operating income and charges	31/12/2020	31/12/2019
Operating income
Administrative service provided in favour of Group companies	6,747,079	13,349,096
Recovery of costs from Group companies	1,047,782	1,035,666
Various income	11,939,271	4,220,544
Operating charges		0
Contributions to trade associations	-739,015	-945,240
Various expenses	-2,615,817	-3,788,570
Total	16,379,300	13,871,496

Section 18 - Income taxes on continuing operations for the year - Item 250

This item represents the taxes due for the period resulting from both current taxes and deferred taxes.

18.1 Breakdown of "Income taxes on continuing operations for the year"

	31/12/2020	31/12/2019
1. Current taxes	51,004,263	45,943,429
2. Changes in current taxes of previous years	-441,863	-1,234,216
3. Reduction in current taxes of the year	0	0
3. bis Reduction in current taxes of the year for tax credits pursuant to Italian Law No. 214/2011	0	0
4. Changes in deferred tax assets	420,843	-27,071
5. Changes in deferred taxes	0	0
Taxes pertaining to the year	50,983,243	44,682,142

Current taxes refer to IRES and IRAP for the year.

Reconciliation between theoretical tax borne by the companies (IRES 24%) and current IRES for the period is provided below.

18.2 - Reconciliation between theoretical taxes due and actual balance sheet taxes due

Result before tax					165,133,080
Theoretical rate of income taxes	24.00%
Theoretical tax charges				-39,631,939
Tax effect of IRES temporary differences
Non-deductible costs	-0.65%	-4,475,558	-1,074,134
Other permanent deductible differences	0.53%	3,680,475	883,314
Total				- 190,820
Tax effect of IRES temporary differences
Tax effect of increases in 1RES
Allocation to provisions for risks and charges	-1.76%	-12,089,957	-2,901,590
Other non-deductible costs for tax year	0.00%	0	0
Total				- 2,901,590
Tax effect of decreases in 1RES
Tax amortisation of goodwill	0.04%	288,889	69,333
Use of allocation to provisions for risks and charges	1.90%	13,091,430	3,141,943
Termination of non-deductible costs for tax year				3,211,276
Total
Net tax effect of IRES temporary differences that arose during the year	-0.19%			- 309,686
Current and deferred taxes from previous years	0.24%			390,349
Neutralisation of taxes of overseas branches	-2.93%			- 4,842,460
Net tax effect of IRAP temporary differences that arose during the year ()	-0.01%			- 13,433
IRAP (regional business tax) for the current year ()	-4.05%			- 6,694,940
Actual tax charges	-30.87%				-50,983,243
Actual rate of income taxes	30.87%
Income after tax					114,149,837

^(*) In consideration of its particular nature, IRAP is entered on a separate line in this table.

Part D - OTHER INFORMATION

Section 1 - SPECIFIC REFERENCES ON THE ACTIVITIES CARRIED OUT

1.1.4 Own securities under third-party custody

The shares of the Generali Geldmarkt Euro fund are issued in cumulative certificates in the name of Generali Insurance Asset Management SGR S.p.A, and are under the custody of BNP Paribas Securities Services -Germany. The shares of the fund SG Monetaire Plus and the other smaller funds are issued in cumulative certificates in the name of Generali Insurance Asset Management SGR S.p.A., and are under the custody of Société Générale - Paris.

1.2 Information on assets managed

1.2.1 - Total net value of the UCITSs (detail for each UCITS)

UCITS	Total 31/12/2020	Total 31/12/2019
1. Own portfolios
Mutual funds	26,383,371,000	43,775,154,000
Total own portfolios	26,383,371,000	43,775,154,000
2. Portfolios under mandate
Open-ended UCITS:
Generali Investments Sicav	282,922,000	784,863,000
Generali Multipension Solutions Sicav	831,587,000	499,651,000
Generali Investments Luxembourg	333,019,000	190,599,000
Fortuna Investment AG	6,830,232,000	3,132,113,000
3BANKEN	1,271,243,000	1,410,941,000
SGR FONDACO CORP BD	60,787,000	58,499,000
Closed-end UCITS	21,550,256,000
Total portfolios under mandate	31,160,046,000	6,076,666,000
3. Portfolios delegated to third parties
Open-ended UCITS	0	0
Closed-end UCITS
Total portfolios delegated to third parties	0	0

1.2.2 - Total value of the portfolio managements

	Total 31/12/2020		Total 31/12/2019
Individual portfolios		of which invested in funds of the SGR (asset management)		of which invested in funds of the SGR (asset management)
1. Own portfolios
Collective Portfolio Management	416,096,164,000		420,434,436,749
2. Portfolios under mandate
3. Portfolios delegated to third parties
Total portfolios delegated	416,096,164,000	0	420,434,436,749	0

1.2.5 Consulting activity: number of existing consulting contracts

The Company has 4 consulting contracts with Group companies.

Section 3 - INFORMATION ON RISKS AND RELEVANT HEDGING POLICIES

Introduction

The GIAM SGR Risk Management function is carried out by the Risk Management structure, which hierarchically reports to the Chief Executive Officer and functionally to the Board of Directors. The Risk Management structure is set up as an independent and separate department in so far as it does not hierarchically report to any manager of operations areas. It conducts its activity with methods that protect the autonomy of the asset management company both with respect to the Group and in the interest of the parti cipants/customers.

The Manager of the Risk Management structure is supported by a team of 4 resources who have adequate expertise and experience in asset management processes and in the risk profile/yield of managed portfolios valuation techniques, measurement of performance, assessment of financial and operating risks, financial and operating risk control tools and with a high degree of independence and objectivity in performing their duties. In compliance with the Bank of Italy Regulation of 5 December 2019 as amended (Implementation of MiFIDII/MIFIR package"), the Manager of the Risk Management structure collaborates in defining the company's risk management system, supervises operation of the company's risk management system, and checks that it is observed by the intermediary and significant parties. The manager also checks the adequacy and effectiveness of the measures taken to remedy shortcomings found in the company's risk management system.

Therefore, the risk management function identifies, measures, controls and manages risks linked to the activities, processes and systems of the Company in compliance with the criteria set out in the Regulation and with the strategies and risk profile established by Top Management.

The report of the Manager of the Risk Management function on management of the financial risks and operational risks is also submitted to the Board of Directors as instructed by the regulations in force and in compliance with the frequency established by the regulations.

The risks to which the Company is subject are of a financial nature, and are based on the choices made in investing the company's assets and cash equivalents, and of an operational nature in connection with the funds, individual assets and compliance management activity carried out.

The Company attaches great importance to the management and control of potential risks that it bases on the following principles:

―	clear identification of risk assumption responsibilities;
―	systems of measurement and control in line with international best practices;
―	organisational division between the functions assigned to management and the functions in charge of control. The Company's risk culture consists of the knowledge and awareness of all types of risk to which the Company is exposed, the ability to measure its exposure on an ongoing basis and promptly reporting it to both the corporate strategic supervision bodies and the operational structures involved. The Board of Directors approves the corporate policies and internal procedures on the subject of risks, and is regularly informed of the proper operation of the risk control system and its level of exposure through proper reporting.

The risk culture is constantly spread throughout the Company with the following methods:

―	spread of internal regulations on managing risks, both financial and operational, which everyone must follow;
―	escalation procedures in the risk management processes;
―	reporting to Top Management and to the Board of Directors of the Company prepared by Risk Management concerning the performance data and financial risk indicators;
―	Quarterly report to the Board of Directors on Risk Management results concerning the investment activities;
―	Annual report to the Board of Directors on the activities carried out by Risk Management;
―	Investment Committees in which the Risk Management structure participates and provides reporting adequate for supporting the investment activities on behalf of the managed customers;
―	Operational Risk committees in which the Risk Management structures presents the results of the assessments to Top Management and to the Board of Directors of the Company and proposes action plans for mitigation;
―	promotion of greater cooperation and sharing of work methodologies with the other Parent Company, Risk Management functions;
―	use of qualitatively adequate resources, providing incentives for their professional training on the international best practices of the risk management system;
―	internal and external training courses.

Moreover, regarding the operational risks through:

―	interviews and questionnaires sent to owners of the processes that spread basic operational risk management concepts;
―	collection of loss data caused by operational risks and relevant reporting.

3.1 Financial risks

As previously explained, the financial risks arise from choices made in investing corporate assets and cash equivalents. In this area, the Company adopts a prudential policy and invests its cash equivalents in harmonised UCITS units subject to market and currency fluctuations and to risks inherent in this type of investment.

3.2 Operational risks

Qualitative information

Operational risk was identified as the risk of sustaining losses arising from the inadequacy or inefficiency of internal procedures or systems, human resources or external events. This definition comprises legal risk; on the other hand, strategic and reputation risks are not included.

The Company's risk management and control system is a "process" and involves, with different roles, the corporate functions, the Risk Management structure and Top Management.

The phases of this process - defined according to the guidelines and risk identification and management methodologies adopted by the Parent Company, - are summarised below:

a. Identification and assessment of the risks. The operational risk identification and assessment activity is carried out following the Risk Self-Assessment methodology, which requires the continuous identification and measuring of the risk by management and staff involved in the processes, of which they have the best perception, ("risk owners" of the process).

The Risk Management resources ("risk analysts") identify the potential risks, relevant causes, existing key internal controls and residual risks with reference to the main corporate processes and their objectives through interviews with the Managers of the structures involved.

A qualitative measurement (high, medium high, medium, medium low and low) that expresses its value in terms of impact and frequency of the event is assigned to every risk, whether it is potential or residual. The service managers, supported by the hierarchically higher senior managers and staff of the Risk Management function, directly define the measurement as one of their responsibilities. The findings and assessments made are shared with Top Management at specific periodic meetings (Operational Risks Committee) that the appointed delegates of the Company and Parent Company, attend.

b. Definition and execution of the corrective actions. Action plans are proposed to mitigate exposure to operational risks. The actions are identified by the process owners with the support of the Risk Management resources and are approved by Top Management during the Operational Risks Committee meetings.

Quantitative information

The historical trend of the losses referring to operational risk recorded at the beginning of operations confirmed that the existing regulatory capital, already adequate for the purpose of meeting the prudential capitalisation coefficients set by the supervisory regulations issued by the Bank of Italy for asset management companies, is sufficient for the operational risks that have emerged.

Impacts resulting from the Covid-19 pandemic

The Covid-19 pandemic has had a strong social and economic impact all over the world. In order to contain the spread of the disease and to ensure the operational sustainability of health systems, in fact, governments have adopted more or less stringent restrictive measures that have had a profound effect on the lifestyle and daily habits of families and businesses, also leading to a sharp slowdown in global economic growth. The Company reacted in the first place by activating the appropriate Crisis Committee as required by the Business Continuity plans. The committee, by analysing all the evidence available in the meetings held from time to time, has identified some priority actions under the following guidelines:

―	protection of people: promotion of smartworking as a standard working method (5 out of 5 working days), stringent protocols for access to company offices and related sanitation, suspension of business trips, special training courses for employees to safely manage the work activity in the pandemic phase, etc.;
―	more stringent monitoring of financial risks to limit losses in managed portfolios: special measurement of exposure to specific risk factors (e.g. exposure to sectors particularly affected by the pandemic and restrictive measures, liquidity risk, credit risk, etc.) and provision of extraordinary investment committees to better address management decisions in the light of the unpredictable scenario;
―	special analysis and assessment of possible operational risks deriving from the contingent situation (e.g. IT security risks, technological capacity, operational continuity, etc.) and the adoption of related mitigation actions, such as the strengthening of the IT network, the analysis internal business continuity on the main service providers / outsourcers (technological and otherwise), etc.

3.3 Compliance risks

The Company manages the compliance risks by adopting an organisational and governance model such as to supervise proper valuation and analysis of the regulatory fulfilments, regulations of the managed products and resolutions passed by the internal bodies across all the transferable securities processes.

Section 4 - INFORMATION ON CAPITAL

4.1 Capital of the company

4.1.1 Qualitative information

The "capital" consists of ordinary shares. The "reserves" consist of the legal reserve and the other reserves for retained earnings. The capital is constantly monitored to ensure its adequacy, also with reference to the obligations established by the Regulatory Capital regulations.

4.1.2 Quantitative information

4.1.2.1 Capital of the company: breakdown

Items / Values	31/12/2020	31/12/2019
1. Share capital	60,085,000	60,085,000
2. Share premiums	53,033,279	53,033,279
3. Reserves	0	0
- of profits	0	0
a) legal	12,017,000	12,017,000
b) statutory	71,044,132	55,348,083
c) treasury shares	0	0
d) other	0	0
- other	0	0
4. (treasury shares)	0	0
5. Valuation reserves	0	0
- Available-for-sale financial assets	0	0
- Tangible assets	0	0
- Intangible assets	-87,977,753	-87,170,162
- Hedges of net investments in foreign operations	0	0
- Cash flow hedges	0	0
- Exchange differences	0	0
- Non-current assets and discontinued operations	0	0
- Special revaluation laws	0	0
- Actuarial gains/losses relating to defined benefit pension plans	0	0
- Share of valuation reserves relating to equity investments valued at equity	0	0
6. equity instruments	0	0
7. Profit (loss) for the year	114,149,837	97,514,623
Total	222,351,495	190,827,823

The item Valuation Reserve - Intangible assets consists of the Equity investment valuation reserves in the amount of

- €9,256,945, of the Reserves under common control in the amount of - €71,637,870 and Other reserves in the amount of - €7,082,938.

4.2 Regulatory capital and ratios

4.2.1 Regulatory capital

4.2.1.1 Qualitative information

For the purpose of calculating the regulatory capital, Tier 1 capital is consisting of the share capital, the legal reserve and the other reserves for retained earnings.

4.2.1.2 - Quantitative information

	Total 31/12/2020	Total 31/12/2019
A. Tier 1 capital prior to application of prudential filters	79,599,629	57,050,442
B. Prudential filters of the tier 1 capital:
B.1 Positive IAS/IFRS prudential filters (+)
B.2 Negative IAS/IFRS prudential filters (-)		-40,477
C. Total Tier 1 capital (TIER 1) (A + B)	79,599,629	57,009,965
D. Tier 2 capital before the application of prudential filters	0	0
E. Prudential filters of the tier 2 capital:
E.1 Positive IAS/IFRS prudential filters (+)
E.2 Negative IAS/IFRS prudential filters (-)
F. Total tier 2 capital (TIER 2) (D + E)	0	0
G. Items to be deducted from the total of tier 1 and tier 2 capital:
H. Regulatory capital (C + F - G)	79,599,629	57,009,965

4.2.2 Capital adequacy

4.2.2.1 Qualitative information

In order to assess the adequacy of the regulatory capital supporting current and perspective activities, the Company periodically checks the adequacy of the assets with proper simulations of the effects that the operational plans may have on the regulatory capital.

These checks are systematically carried out when drafting long-term strategic plans, when preparing the annual budget and when periodically revising it and, in any case, in the presence of extraordinary events where the requirements are met.

4.2.2.2 Quantitative information

	Requirements
Categories /Values	31/12/2020	31/12/2019
Requirement relating to the total managed	10,000,000	10,000,000
"Other risks" requirement	31,893,666	34,355,310
Requirement relating to the management of pension fund resources with the guarantee of
capital repayment	18,084,451	9,012,997
Requirement relating to risk deriving from professional responsibility for AIF management	4,167,757	4,223,620
Total capital requirement	54,145,874	47,591,927

Section 5 - ANALYTICAL STATEMENT OF COMPREHENSIVE INCOME

Section 4 - Analytical statement of comprehensive income

Items	31/12/2020	31/12/2019
10. Profit (loss) for the year	114,149,837	97,514,623
Other income components without release to profit or loss
20.Equity securities measured at fair value through other comprehensive income
a) fair value change
b) transfers to other net equity
30. Financial liabilities designated at fair value through profit or loss (changes in own credit worthiness):
a) fair value change
b) transfers to other net equity
40.Hedges of equities measured at fair value through other comprehensive income:
a) fair value change (hedged instruments)
b) fair value change (hedging instruments)
50.Tangible assets
60.Intangible assets
70.Defined benefit plans	98,232	-65,967
80.Non-current discontinued operations
90.Share of valuation reserves of equity investments recognised with the equity method
100.Income taxes related to other income components without release to profit or loss
Other income components with release to profit or loss
110.Hedges of net investments in foreign operations:
a) fair value changes
b) release to profit or loss
c) other changes
120.Exchange differences:
a) fair value changes
b) release to profit or loss
c) other changes
130.Cash flow hedges:
a) fair value changes
b) release to profit or loss
c) other changes
of which: return from net positions
140.Hedging instruments (non-designated items)
a) changes in value
b) release to profit or loss
c) other changes
150. Financial assets (other than equity securities) measured at fair value through other comprehensive income:
a) fair value changes
b) release to profit or loss
- credit risk adjustments
- profits/losses from sale
c) other changes
160.Non-current assets and discontinued operations:
a) changes in value
b) release to profit or loss
c) other changes
170. Share of valuation reserves relating to equity investments valued at equity:
a) fair value changes
b) release to profit or loss
- credit risk adjustments
- profits/losses from sale
c) other changes
180.Income taxes related to other income components with release to profit or loss
190. Total other income components	98,232	-65,967
200. Comprehensive income (Items 10+1 90)	114,248,069	97,448,656

Section 6 - TRANSACTIONS WITH RELATED PARTIES

6.1 Information on the remuneration of key managers

Key managers are those parties who directly or indirectly have the power and responsibility for planning, managing and controlling the entity's activities, including the directors and the entity's supervisory bodies.

The costs pertaining to them are itemised below:

6.1 - Information on the remuneration of key managers

	31/12/2020
Key managers	1,095,513
Directors	138,500
Board of Statutory Auditors	88,458
Total	1,322,471

As at 31 December 2020 there were no credits or guarantees issued in favour of directors and senior managers.

6.2. Information on transactions with related parties

The Company carried out transactions with Generali Group companies that are described in the relevant section of the Report of the Board of Directors that accompanies these financial statements and to which the reader is referred. These relations and transactions were settled at normal market conditions.

Section 7 - INFORMATION ON LEASES

The detailed information relating to the rights of use acquired with the leases is provided in Section 8 - Tangible Assets - Item 80 in Part B, while that regarding the payables for leases is provided in Section 1 - Financial liabilities measured at amortised cost - Item 10 in Part B and that regarding the interest expense on payables for leases and the other charges connected with the rights of use acquired with the leases is provided in the respective sections in Part C.

Please note that the leases regarding the properties for office use are entered into with Generali Group companies and are included in the breakdown provided in Section 8 below.

Section 8 - OTHER INFORMATION

8.1 Information on the company exercising the management and coordination activities

Name and office address

Generali Investments Holding S.p.A.

Registered office in Trieste at Via Machiavelli, 4

The essential data of the Holding Company, Generali Investments Holding S.p.A. presented in the summary prospectus were taken from the relevant financial statements as at 31 December 2019 that, along with the report of the auditing firm EY S.p.A., are available in the forms and methods required by law.

8.1 - Data of the Holding Company

(Figures in €)	2019 Financial Statements
Interest income and similar revenues	84,620
Interest expense and similar charges	-1,045,065
Dividends and similar revenues	123,720,240
Administrative expenses:
a) staff costs	-23,386,573
b) other administrative costs	-35,686,916
Other operating income and charges	50,047,079
Profits/(Losses) on equity investments	-3,500,000
Income taxes for the year	-18,601,399
Equity investments	352,534,096
Share capital	41,360,000
Profit for the year	93,177,873

8.2 Intragroup relations

The chief relations with the Group companies are described in detail in the relevant table that follows:

Counterparty	Assets	Liabilities	Charges	Income
3 Banken-Generali Investment-Gesellschaft mbH	98,515.21			-1,206,330.83
AachenMünchener Lebensversicherung AG	6,850,209.08	88,745.42	4,376.15	-19,072,814.31
AachenMünchener Versicherung AG	427,421.07	3,700.00	532.07	-1,374,830.90
ADVOCARD Rechtsschutzversicherung AG	105,387.00			-302,147.68
Alleanza Assicurazioni S.p.A.	9,159,551.85			-14,728,802.10
AM Gesellschaft für betriebliche Altersversorgung mbH	2,878.05	-2,878.05
Assicurazioni Generali S.p.A.	64,811,838.03	-1,849,294.91	1,899,258.81	-1,645,815.15
Banca Generali S.p.A.	7,074,247.62	-147,730.59	281,250.00
BAWAG P.S.K. Versicherung AG	553,728.60			-1,113,851.00
BG Fund Management Luxembourg S.A.	81,124.73
Blitz 17-628 AG				-417,736.66
Central Krankenversicherung Aktiengesellschaft	3,076,632.01	99.96	16,745.69	-10,529,616.25
CityLife S.p.A.	-14,753.88	6,353.88
Cologne 1 S.à.r.l.	136,797.27	-137,925.28	552,259.33	-943.37
Cosmos Lebensversicherungs Aktiengesellschaft	2,660,999.99		4,865.87	-8,336,942.65
Cosmos Versicherung Aktiengesellschaft	79,220.27			-245,418.37
D.A.S. Difesa Automobilistica Sinistri - S.p.A. di Assicurazione	29,130.78			-72,402.65
Dialog Lebensversicherungs-Aktiengesellschaft	142,694.06			-417,630.08
ENVIVAS Krankenversicherung AG	89,684.20			-289,842.80
Europ Assistance Belgium S.A.	21,381.97			-41,222.12
Europ Assistance España S.A. de Seguros y Reaseguros	27,615.72			-55,130.20
Europ Assistance Holding S.A.	1,973.56			-895.53
Europ Assistance Italia S.p.A.	38,692.29			-79,653.14
Europ Assistance S.A.	94,163.54			-188,564.46
Europ Assistance VAI S.p.A.	-6,806.00	-32,384.07	77.42
Europ Assistance Versicherungs-Aktiengesellschaft	16,376.60
Europäische Reiseversicherung Aktiengesellschaft	8,851.53			-20,234.41
Fortuna Investment AG	1,362,532.70	-219,033.38	185,544.06	-3,752,371.45
Fortuna Lebens-Versicherungs AG	34,950.16			-133,500.65
Fortuna Rechtsschutz-Versicherung-Gesellschaft AG	6,108.35			-12,211.85
Generali Assurances Générales SA	116,921.34			-531,611.70
Generali Business Solutions S.c.p.A.	134,276.17	-371,133.56	977,906.72	-2,560.75
Generali Companhia de Seguros, S.A.				-78,724.92
Generali Deutschland AG	211,077.75	12,146.08	-10,312.58	-385,544.98
Generali Deutschland Informatik Services GmbH		700.00	128,000.00	-9,397.93
Generali Deutschland Pensionskasse AG	645,641.06			-1,936,748.53
Generali Deutschland Services GmbH	57,135.41	68,298.81	339,724.70	-17,648.83
Generali España, S.A. de Seguros y Reaseguros	14,358.55			-57,972.68
Generali France S.A.		-14,757.00	14,757.00
Generali Hellas Insurance Company S.A.	107,765.36			-373,877.46
Generali IARD S.A.	2,201,668.41			-3,477,060.49
Generali Investments CEE, Investicní Spolecnost, a.s.	30,000.00
Generali Investments Holding S.p.A.	2,578,618.61	-17,927,535.39	51,600,328.47	-1,729,331.09
Generali Investments Holding S.p.A.	32,418.83
Generali Investments Luxembourg S.A.	2,862,298.45	-2,731.12		-3,803,803.53
Generali Investments Partners S.p.A.	1,872,583.72	-1,870,311.43	3,429,988.61	-6,878,593.71
Generali Italia S.p.A.	28,538,264.72	-7,877,032.29	437,309.42	-34,309,362.05
Generali Lebensversicherung Aktiengesellschaft	1,068,846.00			-130,168.00
Generali Life (Hong Kong) Limited	196,020.90			-334,090.66
Generali Luxembourg S.A.	11,535.21			-22,921.30
Generali Pensions- und SicherungsManagement GmbH		-225.09
Generali Pensionsfonds AG	21,962.13			-74,905.02
Generali Personenversicherungen AG	689,380.66			-2,540,398.54
Generali Properties S.p.A.		-3,722.84
Generali Real Estate S.p.A.	4,160,368.43	-4,684,137.93	2,070,514.28
Generali Real Estate S.p.A. SGR	5,928.81	-4,133.41
Generali Seguros, S.A.	849,660.69			-1,035,109.59
Generali Versicherung AG	2,520,518.16			-5,039,115.95
Generali Vida Companhia de Seguros S.A.	0			-86,914.37
Generali Vie S.A.	41,549,087.23	-371,257.75	31,617.43	-68,161,366.32
Genertel S.p.A.	292,411.66			-451,629.02
Genertellife S.p.A.	3,077,487.07			-11,747,531.88
GFA Caraïbes	94,965.23			-175,252.54
GID Fonds AAREC				-2,280,474.95
GID Fonds ALAOT				-863,147.10
GID Fonds ALRET			8,973.46	-2,442,638.79
GID Fonds AMLRET				-507,740.74
GID Fonds AVAOT				-64,486.95
GID Fonds AVAOT II				-38,396.73
GID Fonds AVAOT III				-6,857.10
GID Fonds AVRET			47.79	-137,759.96
GID Fonds CEAOT				-889,434.09
GID Fonds CERET			6,614.62	-2,581,615.13
GID Fonds CLAOT				-477,176.60
GID Fonds DLRET			276.76	-88,817.92
GID Fonds GDPRET				-160,591.69
GID Fonds GDRET				-156,156.02
GID Fonds GVMET				-275,028.55
GID Fonds GVRET			358.20	-315,316.70
GID-Fonds CLRET				-726,332.53
GID-Fonds CLRET 2			2,863.61	-1,492,530.11
GID-Fonds GPRET				-96,964.20
Grupo Generali España Agrupación de Interés Económico	1,135,074.24			-3,716,269.28
GSS - Generali Shared Services S.c.a.r.l.		-704,777.60	4,824,256.60	-842,403.79
L'Equité S.A. Cie d'Assur. et Réass. risques de toute nature	774,307.47			-1,353,116.58
Prudence Creole	101,216.40			-185,433.87
Trieste Courtage S.A.			6,381.48
Total	192,922,945.03	-36,040,957.54	66,814,515.97	-227,129,239.83

Nature of the service	Assets	Liabilities	Charges	Income
Other operating income and charges	4,565,594.77	-24,589,713.76	7,752,794.06	-2,950,466.53
Commission income	103,160,011.70			-217,235,228.95
Commission expense		817,838.40	1,101,602.32
Operating lease contracts	11,911,627.89	-12,269,082.18	2,214,874.31
Costs for seconded personnel			1,587,717.48
Services and Consulting	3,213,785.74		54,108,765.19	-6,736,906.44
Bank c/a transactions	70,071,924.93		48,762.61
Recovery of cost of seconded personnel				-206,637.91
Total	192,922,945.03	-36,040,957.54	66,814,515.97	-227,129,239.83

8.3 - Fees for the audit and services other than the audit

Type of service		Entity that provided the service	Amount
Audit	BDO Italia S.p.A.		90,000
Other auditing and attestations	BDO Italia S.p.A.		50,000
Total			140,000

The amount concerning the audit also includes the activities carried out on the French and German branches.

Independent auditor's report pursuant to article 14 and 19-bis of Legislative Decree n. 39, dated January 27 2010

Financial statements at December 31, 2020

This report has been translated into English from the original, which was prepared in Italian and represents the only authentic copy, solely for the convenience of international readers.

Independent auditor's Report

pursuant to article 14 and 19-bis of Legislative Decree n. 39, dated January 27 2010 To the shareholder of Generali Insurance Asset Management SGR S.p.A.

Report on the financial statements

Opinion

We have audited the financial statements of Generali Insurance Asset Management SGR S.p.A. (the Company), which comprise the balance sheet as at December 31, 2020, the profit and loss account, the statement of other comprehensive income, statement of changes in net equity, the cash flow statement for the year then ended and notes to the financial statements.

In our opinion, the financial statements give a true and fair view of the financial position of the Company as at December 31, 2020 and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the European Union, as well as with the regulations issued to implement article 43 of Legislative Decree NO. 136/15.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISA Italia). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.

We are independent of the Company in accordance with the ethical and independence requirements applicable in Italy to the audit of financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other matters

The financial statements for the year ended December 31st, 2019 were audited by another auditor who, on April 9, 2020, expressed an unmodified opinion on those financial statements.

As required by law, in the notes of the financial statements Generali Insurance Asset Management SGR S.p.A reported the key figures of the last financial statements of Generali Investments Holding S.p.A. which exercises direction and coordination activity over it. Our opinion on the financial statements of Generali Insurance Asset Management SGR S.p.A. does not extend to such data.

Responsibilities of Management and Those Charged with Governance (Collegio Sindacale) for the Financial Statements

The Directors are responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards as adopted by the European Union, as well as with the regulation issued to implement article 43 of Legislative Decree NO. 136/15 and, within the terms provided by the law, for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

The Directors are responsible for assessing the Company's ability to continue as a going concern and, when preparing the financial statements, for the appropriateness of the going concern assumption, and for appropriate disclosure thereof. The Directors prepare the financial statements on a going concern basis unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

The statutory audit committee ("Collegio Sindacale") is responsible, within the terms provided by the law, for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standard on Auditing (ISA Italia) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with International Standard on Auditing (ISA Italia), we exercise professional judgment and maintain professional skepticism throughout the audit. We also have:

―	Identified and assessed the risks of material misstatement of the financial statements, whether due to fraud or error, designed and performed audit procedures responsive to those risks, and obtained audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
―	Obtained an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
―	Evaluated the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.
―	Concluded on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
―	Evaluated the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We have communicated with those charged with governance, as properly identified in accordance with ISA Italia, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Report on other legal and regulatory requirements

Opinion pursuant to article 14, paragraph 2, letter e), of Legislative Decree n. 39/10

The Directors of Generali Insurance Asset Management SGR S.p.A. are responsible for the preparation of the report on operations of Generali Insurance Asset Management SGR S.p.A. as at December 31, 2020, including their consistency with the financial statements and their compliance with the applicable laws and regulations.

We have performed the procedures required under audit standard (SA Italia) n. 720B in order to express an opinion on the consistency of the report on operations, with the financial statements of Generali Insurance Asset Management SGR S.p.A. as at December 31, 2020 and on their compliance with the applicable laws and regulations, and in order to assess whether they contain material misstatements.

In our opinion, the report on operations is consistent with the financial statements of Generali Insurance Asset Management SGR S.p.A. as at December 31, 2020 and is compliant with applicable laws and regulations.

With reference to the assessment pursuant to article 14, paragraph. 2, letter e), of Legislative Decree n. 39/10 based on our knowledge and understanding of the entity and its environment obtained through our audit, we have nothing to report.

(signed in the original)

Rome, April 13, 2021

BDO Italia S.p.A.

Emmanuele Berselli, Partner

GENERALI Insurance Asset Management S.p.A. - Società di gestione del risparmio

Registered office: Via Machiavelli, 4 - 34132 Trieste

Secondary office: Piazza Tre Torri, 1 - 20145 Milan

Paris secondary office: 2, rue Pillet-Will - 75309

Cologne secondary office: Tunisstraße 19-23 - 50667

Share capital of Euro 60,085,000 fully paid-up

Trieste Companies Register no. 05641591002

Register of Asset Management Companies no. 18 in the UCITS section and no. 22 in the AIF section of the Register of Asset Management Companies Authorised to perform Asset

Management Services

Participant of the National Guarantee Fund pursuant to Art. 62 of Legislative Decree 415 of 23 July 1996, a company subject to the management and coordination of Generali Investments Holding S.p.A.

Report of the Board of Statutory Auditors to the Shareholders' Meeting called to approve the financial statements as at 31 December 2020

Dear Shareholder,

We have examined the Company's Financial Statements for the year ended 31 December 2020, consisting of the Statement of Financial Position, Income Statement, Statement of Comprehensive Income, Statement of Changes in Equity, Statement of Cash flows and Notes to the Financial Statements, accompanied by the Board of Directors' Report on Operations, which were approved by the Board of Directors on 31 March 2021 and submitted to the Board of Statutory Auditors.

The Board of Statutory Auditors specifies that on 9 April 2021, Generali Holding S.p.A. (GI Holding), parent company of Generali Insurance Asset Management S.p.A. Società di gestione del risparmio (GIAM SGR), declared that it had waived the deadline set out in Article 2429, third paragraph, of the Italian Civil Code for the filing at the registered office of the draft Financial Statements, the Board of Statutory Auditors' Report and the Independent Auditor's Report, and that it had undertaken to notify accordingly the Shareholders' Meeting called to approve the financial statements as at 31 December 2020. The failure to comply with the above deadline is due to the fact that the Shareholders' Meeting, convened by the Board of Directors of GIAM SGR at its meeting of 31 March 2021, will be held on 15 April 2021 and therefore in derogation from the deadlines established in Article 2429, paragraph three, of the Italian Civil Code. Generali Holding S.p.A. (GI Holding) therefore acknowledges that the documents referred to in Article 2429, third paragraph, of the Italian Civil Code - including this Report - will be filed in time for the Shareholders' Meeting, but without complying with the deadlines set out in the aforementioned article.

In this regard, the Board of Statutory Auditors also declares that it will waive the deadline established in Article 2429, first paragraph, of the Italian Civil Code. In addition to the appropriation of profit, the Board of Directors' Report provides a wide-ranging overview of: - The situation on the international financial markets: trends in 2020 and the outlook for 2021; - The evolution of deposits and assets managed by the company; The net result for the year, shareholders' equity and the main items of profit/loss and assets/liabilities; Business activity; - Evolution of the organisational structure and HR management; - Research and development; - The main risks and uncertainties; - Relations with Group companies; - Governance and appointments; -Subsequent events and business outlook.

In particular, activities relating to the implementation and definition of the processes resulting from the Partial Demerger Operation, effective as of 1 October 2018, of Generali Insurance Asset Management S.p.A. Società di gestione del risparmio (GIAM SGR) for the benefit of Generali Investments Partners S.p.A. Società di gestione del risparmio (GIP SGR), and its parent company, Generali Investments Holding S.p.A. (GI Holding), continued during the 2020 financial year.

In a particularly difficult year due to the effects of Covid-19, the Company was able to put in place all necessary means to mitigate the impacts of the pandemic on its business and all appropriate and necessary controls to ensure the proper and effective management of the financial investments entrusted to it. Assets under management as at 31 December 2020 (determined on the basis of the statistical data sent to Assogestioni and the figures for the purposes of Consob reports) totalled €473,639 million (up compared with €470,286 million at the end of 2019).

The securities asset management (Gestione Patrimoniale Mobiliare or GPM) services provided by the Company continue to be mainly aimed at corporate investors, particularly in the Generali Group, and some of the largest European pension and insurance funds. The portfolios are normally medium to large in size and management is highly personalised according to the client's objectives/needs. The decrease in the total compared with the previous year reflects the departure of some portfolios. With regard to the promoted UCIs, the decrease in German special funds servicing local companies' insurance portfolios is due to their transfer to a fund manager (MEAG) outside the Group, which in turn delegated their management to GIAM itself. This explains the very similar increase in the products received under delegation. The year began in the normal way, with marketing activities to promote the multiboutique investment expertise already presented to investors in 2019. However, from early March, the Company rapidly adapted its marketing activity to the new and unexpected situation caused by the spread of Covid-19. The pandemic reshaped marketing initiatives, leading to greater digitalisation and broader communication, with diversification of the content developed for the Company's clients. In terms of digital marketing tools, newsletters were redesigned, video and webinar production was increased, and podcasts were introduced to make content available in different formats. The website was overhauled. To demonstrate more proximity to its investors, the Company increased the frequency of communications to them. During 2020, the Company obtained three new mandates totalling €1.9 billion in assets under management.

2020 was characterised by the consolidation of the organisational structure in accordance with the 2018 demerger plan. In particular, in January 2020, some Staff and Control functions (Accounting & Tax, Risk Governance & Oversight, Valuation & Risk Factor Analysis, Operational Risk Management, Investment Control and HR Operations) were transferred to GI Holding.

The employee headcount as at 31 December 2020 was 155, comprising 117 men and 38 women.

With regard to Training and Development activities, in 2020 the implementation of the "People Strategy" continued in the business units (spread over the three-year period 2019-2021).

With regard to the Covid-19 pandemic, which had a significant social and economic impact worldwide, the Company promptly implemented a series of initiatives to ensure business continuity and to protect the health of people working for the Company, the Group and its customers, first of all activating the dedicated Crisis Committee in accordance with its business continuity plans. By analysing all the evidence provided at the meetings held from time to time, the Committee identified certain priority actions under the following guidelines:

―

protection of people: promotion of smart working as the standard working arrangement (5 out of 5 working days), strict protocols for accessing company premises and the related hygienic measures, suspension of business trips, ad hoc training courses for employees in order to manage work safely during the pandemic phase, etc.;

―

more stringent monitoring of financial risks in order to limit losses in the portfolios managed;

―

ad hoc analysis and assessment of possible operational risks arising from contingent situations (e.g. risks associated with IT security, technological capacity, business continuity, etc.) and adoption of relevant mitigation measures, such as IT network enhancement, internal business continuity analysis of the main service providers/outsourcers (technological and non-technological), etc.

Regular meetings also took place to inform workers' representatives of the measures taken by the company to deal with the Covid-19 pandemic.

During the year, the Trieste head office was moved to the new premises at Palazzo Berlam, while in Rome, preparatory work took place to move employees from the head office in Via Silvio D'Amico to the Via Bissolati premises (the transfer took place in late January 2021).

During the financial year, the results of which you are asked to examine, the Board of Statutory Auditors performed the supervisory activity within its purview in accordance with the provisions of the Italian Civil Code and the specific provisions and recommendations in this regard, and in accordance with the principles of conduct recommended by the professional bodies to which it belongs.

The Board of Statutory Auditors informs the Shareholders' Meeting that it undertook the following main activities during the year under review:

―

it participated in all the meetings of the Board of Directors and the Shareholders' Meetings held during the year, verifying the regular conduct of the individual meetings pursuant to the law and to the Articles of Association, obtaining from the Directors adequate information on the economic, operational and equity performance of the Company's business (the main elements of the Company's Income Statement as at 30 June 2020 were presented), as well as on the most material transactions carried out by the Company, and ensuring that the resolutions implemented were consistent with the law and the Articles of Association and were not imprudent and did not give rise to conflicts of interest that were not adequately managed.

In particular, the Board of Statutory Auditors acknowledges that:

―	during the year, the members of the Company's Board of Directors were appointed for the three-year period 2020-2022, with Santo Borsellino appointed Chairman of the Company's Board of Directors, Francesco Benedetto Martorana appointed Chief Executive Officer of the Company, and Mirella Pellegrini appointed Independent Director;
―	the Board of Directors, at its meeting of 24 February 2021, following the resignation of Francesco Benedetto Martorana as Chief Executive Officer with effect from 1 March 2021, without prejudice to his position as a Director of the Company, which was related to his assumption of a new position within the parent company, Assicurazioni Generali S.p.A., appointed Bruno Servant Chief Executive Officer of the Company with effect from 1 March until the end of the mandate of the entire Board. In 2020, the procedure to identify another Independent Director was completed with the appointment of Evi Christine Vogl. At the Shareholders' Meeting of the Company on 15 April 2021, the following item was put on the agenda: "2. Determination of the number and appointment of a member of the Board of Directors and resolutions pursuant to Article 2364 of the Italian Civil Code" in order formally to appoint Ms Vogl as a Director on the BoD of GIAM SGR;
―	it ascertained that the company representatives fulfilled the requirements of integrity and professionalism set out in the applicable legislation for their respective positions, that there were no situations preventing them from holding office, and that they were not ineligible or disqualified from holding office, pursuant to Article 36 of Law 214/2011
―	the Chairman and the standing and alternate members of the Board of Statutory Auditors were appointed for the three-year period 2020-2022;
―	the "2020 Remuneration Policy" was approved.

The Board of Statutory Auditors also specifies that it:

―	met periodically to carry out its audits and to formulate statements, opinions and observations, including in order to approve the resolutions of the Board of Directors, recording its actions in its minute book;
―	acknowledges that it has not received any complaints pursuant to Art. 2408 of the Italian Civil Code, nor any reports;
―	systematically exchanged information and monitored the activities of the Company's Control functions, making observations regarding the annual reports on the activities carried out in the previous year and regarding the activities planned for 2020 presented respectively by the Compliance Officers (which carry out their activities with the support of the Investments Compliance function based at GI Holding), the Company's Anti-Money Laundering function (outsourced to GI Holding), the Internal Audit function (outsourced to Assicurazioni Generali) and the Risk Management function. The Board of Statutory Auditors verified the state of progress and implementation of these plans and any updates presented by each Function during the year (see, in particular, the addition to the IA plan with an advisory audit: "Company responses to operational and IT risks under the new operating framework established as a result of the pandemic"). The periodic reports and the checks performed did not reveal any particularly serious situations or shortcomings, i.e. situations likely to seriously damage the Company's economic and financial stability, or entail a real threat to the Company and / or the Group's reputation, but only areas for improvement, which gave rise to plans for measures, the implementation of which was specifically monitored in terms of time and effectiveness;
―	checked the status of investors' complaints, and acknowledged that no complaints had been received by the Company during the 2020 financial year, and that no complaints had been received or settled in the previous three calendar years (see the 2020 Annual Compliance Report, presented to the BoD at its meeting of 27 January 2021);
―	acknowledged the reports of the meetings of the Investment Risk Committee and the information on the Annual Risk Assessment, which were presented to the Board of Directors of the Company during the year;
―	verified in general the Company's compliance with and adaptation to industry regulations as well as its obligations of correspondence and the sending of notices to the supervisory authorities;
―	participated in the meetings of the internal Board Committees - the Remuneration Committee, Appointments Committee and Risk Committee - established by the Company;
―	assessed and verified the adequacy of the administrative and accounting system as well as its reliability in correctly representing operational facts;
―	periodically exchanged information with the independent auditor, BDO S.p.A., and this company never communicated any facts, circumstances or irregularities that should be brought to the attention of the Board;
―	acquired knowledge of and verified the adequacy of the organisational structure, the evolution of the organisational structure and the human resources management carried out by the Company during the period, the controls of the activities outsourced to GI Holding, GIP SGR and other service providers (the Company established an Outsourcing Committee in the first quarter of 2020) acquired knowledge of staff training and development activities;
―	acknowledges that the Company has prepared a "Report on the Organisational Structure" in order to describe the Company's organisational structure. The report was prepared according to the template set out in the current Bank of Italy Regulation on collective asset management and was submitted to the supervisory authorities by the statutory deadline;
―	acknowledges that the Company fulfilled its obligations regarding measures designed to supervise the commitment to prevent and manage the risks of money laundering and terrorist financing, with particular reference to Legislative Decree 231/2007, as amended, and to the provisions of the Bank of Italy and the FIU: in accordance with Italian anti-money laundering legislation, the Company uses a dedicated application, developed on the Unione Fiduciaria platform (Anti-money laundering - Centralised Computer Archive), to manage the Centralised Computer Archive (AUI);
―	acknowledges that the Company, in accordance with the provisions of the relevant Community legislation and its transposition into the legislation of the countries in which the Company has a presence, has appointed and subsequently assigned responsibility to an AML Officer, an AML Representative and an AML Reporting Officer;
―	has acknowledged the work done by the Supervisory Body pursuant to Legislative Decree 231/2001: the Body reported that during the financial year no facts had emerged that might be relevant pursuant to the legislation in question; the Company also approved the Supervisory Plan and the 2020 Budget and the subsequent Addendum, and updated its Organisation and Management Model (OMM) in relation to epidemiological risk;
―	acknowledges that the Company has performed all necessary and appropriate measures to adapt its company operations to the "General Data Protection Regulation" ("GDPR") and to national industry regulations, also adopting and implementing a "GIAM Privacy Policy";
―	acknowledges that, with regard to research and development activities, during the year the Company paid particular attention to rationalising the supply of products to customers and pursued its customary research activities with the aim of creating new investment products;
―	acknowledges that the Company has prepared an "Employer's Annual Report on Health and Safety" in relation to the Company's Italian offices, in accordance with all legal obligations relating to occupational health and safety (Legislative Decree 81/2008);
―	acknowledges that the Company has appointed a Security Officer, as provided for in the new version of the GIAM Security Policy;
―	acknowledges that the Company has prepared a "Company Self-Assessment Questionnaire for the 2019 financial year" with the aim, as requested by the Bank of Italy, of highlighting the satisfaction levels of Directors and Statutory Auditors with regard to the governance adopted by the Company and the comprehensiveness and completeness of the issues brought to the attention of the BoD and the Internal Board Committees, in order to identify, through the recommendations made in the questionnaires, any areas for improvement and to make appropriate adjustments;
―	acknowledges that the Company has approved the Annual Report on adherence to the Protocol of Autonomy for the Management of Conflicts of Interest, pursuant to Art. 5, paragraph 2, of the Assogestioni Statute;
―	acknowledges that, during the year, the Company adopted and updated the Governance Rules, Policy and Operating Procedures Rulebook of the Group and the Company and the Company's Manual of Procedures;
―	acknowledges that the Company has formally entered into the operating agreement of the Assicurazioni Generali VAT Group, in which the rules for participation and the relationships between the individual companies in the VAT Group are defined;
―	acknowledges that the Company reports that it does not hold, and has never held, treasury shares or shares in its parent company or shares in the holding company, Assicurazioni Generali S.p.A;
―	acknowledges that, in the Report on Operations, the Company reports that it is wholly owned by Generali Investments Holding S.p.A., which is in turn directly and indirectly controlled by Assicurazioni Generali S.p.A., and that as at 31 December 2020 it did not hold any controlling or associated equity investments;
―	acknowledges that, in the Report on Operations and in the Notes, the Company reported that during 2020 it continued to undertake relations and carry out transactions with the parent company Assicurazioni Generali S.p.A. and other Group companies under normal market conditions and that these relations and transactions were never atypical or extraneous in terms of the conduct of the Company's ordinary business;
―	acknowledges that the Notes describe in detail the corporate risks and the policies for managing them, specifically setting out the roles of the various control functions;
―	acknowledges that the Notes contain the figures relating to the capital and the capital adequacy ratios;
―	acknowledges that the key data of the latest Financial Statements of the parent company Generali Investments Holding SpA are shown in the Notes and have been extracted from the relative Financial Statements for the year ended 31 December 2019;

During the year under review, no further significant events occurred that required reporting to the competent supervisory authorities or mention in this Report. It should be noted that, in accordance with current statutory provisions, the Company is subject to statutory audit by BDO Italia S.p.A., which has been awarded the mandate for the statutory audit of the accounts for financial years 2020-2028, as the nine-year audit previously awarded to EY S.p.A. expired when the 2019 financial statements were approved.

During 2020, the independent auditor, BDO S.p.A. ascertained that the company's accounts were properly kept, that management events were correctly entered in the accounting records and that the financial statements for the year ended 31 December 2020 corresponded to the accounting records.

The Chairman of the Board of Statutory Auditors of GIAM SGR, having acknowledged the waiver by GI Holding of compliance with the deadlines established in Article 2429, paragraph 3, of the Italian Civil Code for the filing of the independent auditor's report at the registered office, informed BDO Italia S.p.A. that it was exempt from this deadline.

The independent auditor, BDO Italia S.p.A.:

―	issued its report on the financial statements as at 31 December 2020 without any observations or requests for information;
―	expressed an opinion of consistency and conformity on the Report on Operations;
―	stated its independence from Generali Insurance Asset Management S.p.A. SGR, in accordance with the rules and principles of ethics and independence applicable under Italian law to the auditing of financial statements; having regard to the regulatory and professional requirements governing auditing activity, we believe that BDO S.p.A. maintained its position of independence and objectivity towards the Company during the reference period.

Since we are not responsible for analytical control of the merits of the contents of the Financial Statements, we supervised the process of preparing the Company's financial report within the periods laid down by law. The Notes to the Financial Statements describe the valuation criteria adopted and provide all the information required by current legislation; the report prepared by the directors, which is consistent with the financial statements, describes the operating performance and highlights current and future business trends.

The Financial Statements as at 31 December 2020 record a net profit of €114,149,837, and the directors, having specified that the legal reserve has already reached the limit established in Article 2430 of the Italian Civil Code, and that the amount of shareholder's equity of the Company complies with the prudential capitalisation ratios imposed by the supervisory regulations issued by the Bank of Italy for asset management companies, propose to appropriate the profit as follows: - €1,805.00 per share to 60,085 shares as a dividend, totalling €108,453,425; - €5,696,412 to the retained earnings reserve.

Given the foregoing, to the extent of our competence and knowledge, the Board of Statutory Auditors believes that the Financial Statements as at 31 December 2020, prepared by the Board of Directors, may be approved by you, and expresses a favourable opinion on the proposal made by the Board of Directors for the appropriation of the net profit for the year. Trieste, 13 April 2021.

For the Board of Statutory Auditors

The Chairman

Angelo Venchiarutti

[illegible signature]

Generali Asset Management S.p.A. Società di gestione del risparmio, Zweigniederlassung Deutschland