Natixis — Groupe BPCE — Q1 2013 Earnings Presentation
59 slides from Natixis's earnings presentation, May 6, 2013
Slide 1: Results for the first quarter of 2013
May 6, 2013 Results for the first quarter of 2013
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements and comments relating to the objectives and strategy of Groupe BPCE. By their very nature, these forward-looking statements inherently depend on assumptions, project considerations, objectives and expectations linked to future event
Slide 3: Key messages
Key messages Net income attributable to equity holders of the parent: €754m, +13.2% vs. Q1-12; net income attributable to equity holders of the parent, excluding the revaluation of BPCE's own debt, remains stable at €760m Robust Q1-13 4.2% growth in revenues vs. Q1-12 results in an adverse econo
Slide 4: Key messages
Key messages Success of the drive to attract new customers confirmed for priority targets: Banque Populaire: +4.9% active individual customers (banking and insurance) Commercial Caisse d’Epargne: +7.8% principal active customers using banking services Banking & Buoyant growth in savings depo
Slide 5: Contents
Contents 1. Groupe BPCE results 2. Capital adequacy and liquidity 3. Results of the core business lines May 6, 2013 Results for the 1st quarter of 2013 5
Slide 6: Groupe BPCE Q1-13 results
1. Groupe BPCE Q1-13 results Robust results in an adverse economic climate; 13.2% growth in net income attributable to equity holders of the parent to €754m Q1-13/ Core Q1-13/ Q1-12 business Q1-12 in millions of euros Q1-13 % lines1 % change Q1-13 change Net banking income 5,679 4.2% 5,352 0.3% Oper
Slide 7: Synergies achieved ahead of the pre-defined targets
1. Groupe BPCE results Synergies achieved ahead of the pre-defined targets Revenue synergies between Natixis and the Banque Populaire and Caisse d’Epargne networks Cost synergies End of March 2013 Cost synergies of €962m generated as at March 31, 2013 for the Group as a whole, 2013 target €670m €8
Slide 8: Deterioration in the cost of risk of the core businesses
1. Groupe BPCE results Deterioration in the cost of risk of the core businesses related to the depressed economic climate, but provisions for credit losses remain at a moderate level Cost of risk in bp 32 31 28 27 27 32 31 29 25 23 25 21 25 Commercial Banking & Insurance1 52 56 56 44 49 39 26 33 27
Slide 9: GAPC: acceleration of the disposal program
1. Groupe BPCE results GAPC: acceleration of the disposal program; aim to wind up GAPC by mid-2014 Asset disposals completed in 2013: €2.4bn1 Risk-weighted assets2 (in €bn) at May 2, 2013 of which €1.0bn in Q1-13 on portfolios of plain vanilla and structured financing solutions -57% 57% decline
Slide 10: Contents
Contents 1. Groupe BPCE results 2. Capital adequacy and liquidity 3. Results of the core business lines May 6, 2013 Results for the 1st quarter of 2013 10
Slide 11: Common Equity Tier 1 ratio under Basel 3 at 9.3%
2. Capital adequacy and liquidity Common Equity Tier 1 ratio under Basel 31 at 9.3% at end of March 2013 (on a pro forma basis to account for the CICs buyback project) +20bp +15bp +10bp 9.4% -15bp 9.3% 9.0% -5bp Common Equity Change in Q1-13 result Issue of Change in activity Common Equity CIC buyba
Slide 12: Continued reduction in wholesale funding requirements
2. Capital adequacy and liquidity Continued reduction in the Group’s wholesale funding requirements beyond the initial target State of progress for the Group as a whole Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q4-13 Overall target 0 -5.0 of reducing -9.5 -10.6 liquidity -6.0 -15.3 -17.8 -21.7 requi
Slide 13: Liquidity reserves and short-term refinancing
2. Capital adequacy and liquidity Liquidity reserves and short-term refinancing at March 31, 2013 Liquidity reserves (in €bn) Available assets eligible for Central Bank refinancing Cash placed with Central Banks 144 147 110 98 104 83 46 43 27 Dec. 31, 2011 Dec. 31, 2012 March 31, 2013 Short-term1 re
Slide 14: MLT funding: 67% of the 2013 program completed
2. Capital adequacy and liquidity MLT funding: 67% of the 2013 program completed at March 31, 2013 (including excess funds raised in 2012) MLT funding plan completed at March 31, 2013 2013 MLT funding plan for a total of €21bn down from €24.5bn in 2012 65% €14.1bn1 raised via the 2 funding pools
Slide 15: Contents
Contents 1. Groupe BPCE results 2. Capital adequacy and liquidity 3. Results of the core business lines May 6, 2013 Results for the 1st quarter of 2013 15
Slide 16: Commercial Banking and Insurance
3. Results of the core business lines Commercial Banking and Insurance Q1-13/ in millions of euros Q1-13 Q1-12 % change Net banking income 3,732 -1.1% Excluding changes in provisions for home 3,715 -1.9% purchase savings schemes BP 1,555 -1.0% BP - excluding changes in provisions for home 1,546 -1.5
Slide 17: Commercial Banking and Insurance
3. Results of the core business lines Commercial Banking and Insurance Unless specified to the contrary, all changes are vs. Q1-12 Extremely dynamic commercial Contribution to income before tax in Q1-13 performance achieved by both the BP and CE retail networks > Strong growth in on-balance sheet
Slide 18: Results of the Banque Populaire banks
3. Results of the Banque Populaire banks Unless specified to the contrary, all changes are vs. Q1-12 Savings deposits: change over the past year Customer base: priority given to intensifying (as a %) customer relations > Individual customers: +4.9% for active customers using banking services and i
Slide 19: Results of the Caisses d'Epargne
3. Results of the Caisses d’Epargne Unless specified to the contrary, all changes are vs. Q1-12 Savings deposits: change over the past year (as a %) Customer base: continued strong growth > Active individual customers: +3.3% overall, including +7.8% growth in principal active customers using banki
Slide 20: Real estate Financing: dynamic commercial activity
3. Results of the core business lines Real estate Financing1: dynamic commercial activity in a contracting market Unless specified to the contrary, all changes are vs. Q1-12 Implementation of Crédit Foncier’s 2012-2016 Loan outstandings3 (in €bn) strategic plan > Good commercial performance achiev
Slide 21: Core business lines of Natixis
3. Results of the core business lines Core business lines of Natixis: Wholesale Banking, Investment Solutions, Specialized Financial Services Q1-13/ in millions of euros Q1-13 Q1-12 % change Net banking income 1,620 3.8% Wholesale Banking 798 4.8% Investment Solutions 513 0.3% SFS 309 7.6% Operating
Slide 22: Wholesale Banking: dynamic business activities
3. Results of the core business lines Wholesale Banking: dynamic business activities in the key franchises Unless specified to the contrary, all changes are vs. Q1-12 Financing activities Change in revenues (in €m) Commercial Banking > Sustained activities with corporate customers 361 338 337 360
Slide 23: Investment Solutions: sustained activity
3. Results of the core business lines Investment Solutions: sustained activity in Asset Management in the US and Life Insurance in France Unless specified to the contrary, all changes are vs. Q1-12 Asset Management Assets under management (in €bn) Net inflows (excl. money market products) at €4.5b
Slide 24: SFS: growth in Specialized Financing
3. Results of the core business lines SFS: growth in Specialized Financing and stabilization of Financial Services activities Unless specified to the contrary, all changes are vs. Q1-12 % Q1-13 Q1-12 change Consumer finance Specialized Financing: good performance, Outstandings in €bn 14.0 11.9 +18
Slide 25: Equity Interests
3. Equity Interests1 Q1-13/ in millions of euros Q1-13 Q1-12 % change Net banking income 396 -7.9% Operating expenses -343 -7.0% Gross operating income 53 -13.2% Cost of risk -1 -79.4% Income before tax 57 -4.3% Net income attributable to equity holders of 17 -15.3% the parent 1 The “Equity Interest
Slide 26: Equity Interests: Coface and Nexity
3. Equity Interests Coface core activities1 Credit insurance revenues (in €m) Revenues: +4% vs. Q4-12 but down vs. Q1-12 owing to the downturn in customers’ activities +4% Improvement in income before tax: +29% vs. Q1-12 and +7% vs. Q4-12 Combined ratio: 82.8% vs. 83.6% in Q4-12 thanks to a 39
Slide 27: Conclusion
3. Conclusion Net income attributable to equity holders of the parent of €754m in Q1-13, +13.2% vs. Q1-12, in what remains an adverse economic climate Robust commercial performance achieved by the Group’s core businesses, notably the Banque Populaire banks, the Caisses d’Epargne and Natixis Op
Slide 28: Annexes
May 6, 2013 Results for the 1st quarter of 2013 Annexes
Slide 29: Annexes contents
Annexes Groupe BPCE Wholesale Banking, Investment Solutions > Income statement and SFS > Income statement per business line > Income statement > Consolidated balance sheet Equity interests Financial structure > Income statement > Statement of changes in shareholders' equity > Reconciliation
Slide 30: Groupe BPCE quarterly income statement
Annex - Groupe BPCE Quarterly income statement Groupe BPCE In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 5,450 5,671 5,313 5,512 5,679 Operating expenses -3,954 -3,898 -3,926 -4,157 -3,945 Gross operating income 1,497 1,773 1,387 1,355 1,735 Cost / income ratio 72.5% 68.7% 73
Slide 31: Quarterly income statement per business line
Annex - Groupe BPCE Quarterly income statement per business line Wholesale Banking, Workout portfolio Commercial Banking & Investment Solutions & Total core businesses Equity interests management & Other Groupe BPCE Insurance Specialized Financial businesses Services In millions of euros Q1-13 Q1-12
Slide 32: Consolidated balance sheet
Annex - Groupe BPCE Consolidated balance sheet Assets in €m 03/31/2013 12/31/2012 Liabilities in €m 03/31/2013 12/31/2012 Cash and amounts due from central banks 53,389 53,792 Amounts due to central banks 2 0 Financial assets at fair value through profit or loss 220,189 214,991 Financial liabilities
Slide 33: Statement of changes in shareholders' equity
Annex – Financial structure Statement of changes in shareholders’ equity Equity attributable to in millions of euros equity holders of the parent December 31, 2012 50,554 Distribution 0 Capital increase (cooperative shares) 524 Income 754 Impact of change in accounting standards -171 Remuneration of
Slide 34: Reconciliation of shareholders' equity to Tier-1 capital
Annex – Financial structure Reconciliation of shareholders’ equity to Tier-1 capital in billions of euros -4.6 +2.8 -5.4 -3.2 +5.4 -1.5 52.0 41.6 40.1 45.6 Equity Cancellation of Minority Goodwill & Other Total Equity Deductions Total Core T1 Deeply Total T1 capital attributable to deeply interests²
Slide 35: Prudential ratios under Basel 2.5 and credit ratings
Annex – Financial structure Prudential ratios under Basel 2.5 and credit ratings March 31, March 31, December 31, 20131 20132 2012 Credit risk €334bn €322bn €323bn Market risk €21bn €21bn €19bn Operational risk €39bn €39bn €39bn Total risk-weighted assets €394bn €382bn €381bn Core Tier-1 capital €40
Slide 36: Commercial Banking and Insurance quarterly income statement
Annex – Commercial Banking and Insurance Quarterly income statement Commercial Banking & Insurance In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 3,774 3,646 3,601 3,760 3,732 Operating expenses -2,512 -2,456 -2,470 -2,626 -2,483 Gross operating income 1,262 1,190 1,131 1,134
Slide 37: Commercial Banking and Insurance quarterly income statement
Annex – Commercial Banking and Insurance Quarterly income statement Insurance, International & Other Banques Populaires Caisses d'Epargne Real Estate Financing * Commercial Banking & Insurance networks In millions of euros Q1-13 Q1-12 % Q1-13 Q1-12 % Q1-13 Q1-12 % Q1-13 Q1-12 % Q1-13 Q1-12 % Net ban
Slide 38: Banque Populaire banks and Caisses d'Epargne
Annex – Commercial Banking and Insurance Banque Populaire banks and Caisses d’Epargne Banques Populaires In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 1,571 1,468 1,487 1,508 1,555 Operating expenses -1,048 -1,039 -1,046 -1,052 -1,038 Gross operating income 523 429 440 456 51
Slide 39: Banque Populaire network: savings deposits
Annex - Commercial Banking and Insurance Banque Populaire network: savings deposits (in €bn) % change Q1-13 / Q1-12 Demand deposits -1.1% Passbook savings +17.1% accounts Regulated home +0.5% savings plans Term accounts, PEP +26.0% Mutual funds -20.7% Employee savings +9.1% Life insurance +1.2% Othe
Slide 40: Banque Populaire network: loan outstandings
Annex - Commercial Banking and Insurance Banque Populaire network: loan outstandings (in €bn) % change Q1-13 / Q1-12 Consumer loans and +6.8% Short-term credit facilities Real estate loans +3.2% Equipment loans +0.5% Others n.s. Total loans +2.4% May 6, 2013 Results for the 1st quarter of 2013 40
Slide 41: Caisse d'Epargne network: savings deposits
Annex - Commercial Banking and Insurance Caisse d’Epargne network: savings deposits (in €bn) 358.8 362.7 349.3 35.4 35.0 32.6 % change Q1-13 / Q1-12 132.1 135.7 Demand deposits +7.3% 125.9 Passbook savings +7.8% accounts Regulated home +3.1% 38.9 39.2 40.1 savings plans Term accounts, PEP & 17.7 17.
Slide 42: Caisse d'Epargne network: loan outstandings
Annex - Commercial Banking and Insurance Caisse d’Epargne network: loan outstandings (in €bn) % change Q1-13 / Q1-12 Real estate loans +8.2% Consumer loans + short- +4.8% term credit facilities Equipment loans +10.7% Others n.s. Total loans +8.7% May 6, 2013 Results for the 1st quarter of 2013 42
Slide 43: Real estate Financing; Insurance, International and Other networks
Annex – Commercial Banking and Insurance Real estate Financing Insurance, International and Other networks Real Estate Financing * * In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 211 199 190 208 183 Operating expenses -142 -130 -145 -169 -136 Gross operating income 70 69 45 3
Slide 44: Wholesale Banking, Investment Solutions and SFS income statement
Annex – Wholesale Banking, Investment Solutions and SFS Quarterly income statement Wholesale Banking, Investment Solutions & Specialized Financial Services In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 1,560 1,510 1,450 1,573 1,620 Operating expenses -993 -1,003 -979 -1,062 -
Slide 45: Equity interests quarterly income statement
Annex – Equity interests Quarterly income statement Equity interests In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 430 435 418 449 396 Operating expenses -369 -341 -350 -359 -343 Gross operating income 62 94 69 91 53 Cost of risk -3 -2 -1 1 -1 Income before tax 59 96 69 62 57
Slide 46: Workout portfolio management and Other businesses income statement
Annex – Workout portfolio management and “Other businesses” Quarterly income statement Workout portfolio management & Other businesses In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income -314 80 -156 -270 -69 Operating expenses -80 -98 -127 -110 -94 Gross operating income -395 -18
Slide 47: Workout portfolio management and Other businesses income statement
Annex – Workout portfolio management and “Other businesses” Quarterly income statement Workout portfolio Workout portfolio Other businesses management & Other management businesses In millions of euros Q1-13 Q1-12 Q1-13 Q1-12 Q1-13 Q1-12 Net banking income 60 22 -130 -336 -69 -314 Operating expenses
Slide 48: Workout portfolio management quarterly income statement
Annex – Workout portfolio management Quarterly income statement Workout portfolio management In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income 22 71 98 160 60 Operating expenses -31 -41 -30 -24 -23 Gross operating income -10 30 68 135 37 Cost of risk -40 -31 -21 -170 -24 Income b
Slide 49: Other businesses quarterly income statement
Annex – “Other businesses” Quarterly income statement Other businesses In millions of euros Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Net banking income -336 9 -254 -429 -130 Operating expenses -49 -57 -97 -86 -71 Gross operating income -385 -49 -351 -515 -201 Cost of risk -63 -36 -40 -6 -8 Income before tax -4
Slide 50: GAPC: Detailed exposure as of March 31, 2013
Annex – Workout portfolio management and “Other businesses” – GAPC: Detailed exposure as of March 31, 2013 Risk-weighted assets under Basel 2.5 Guaranteed portfolios (Financial Guarantee & TRS) Type of asset Notional Net Value RWA Discount rate (nature of portfolio) before guarantee In €bn In €bn in
Slide 51: Non-performing loans and impairment
Annex – Risks Groupe BPCE: non-performing loans and impairment in millions of euros March 31, 2013 Dec. 31, 2012 Dec. 31, 2011 Gross outstanding customer loans 593,110 586,479 583,062 O/w non-performing loans 22,169 21,921 20,255 Non-performing / gross outstanding loans 3.7% 3.7% 3.5% Impairment rec
Slide 52: Networks: non-performing loans and impairment
Annex - Risks Networks: non-performing loans and impairment Banque Populaire banks in millions of euros March 31, 2013 Dec. 31, 2012 Dec. 31, 2011 Gross outstanding customer loans 167,259 165,115 160,048 O/w non-performing loans 8,420 8,227 7,738 Non-performing/gross outstanding loans 5.0% 4.98% 4.8
Slide 53: Breakdown of commitments as at March 31, 2013
Annex – Risks Breakdown of commitments as at March 31, 2013 Breakdown of commitments by Breakdown of commitments to Corporates and counterparty Professionals by industrial sector Administration 0,3% Technology 1,4% Services to local authorities 1,6% Communications 2,1% International Commodities Trad
Slide 54: Geographical breakdown of commitments
Annex - Risks Geographical breakdown of commitments as at March 31, 2013 Banks Sovereigns Corporates May 6, 2013 Results for the 1st quarter of 2013 54
Slide 55: Exposure to sovereign debts of peripheral European countries
Annex - Risks Exposure to the sovereign debts of peripheral European countries Net direct exposure of credit institutions in the banking portfolio1 (in €m) 4 062 4 063 3 715 3 710 Dec. 31, 2012 March 31, 2013 25 24 176 178 59 61 27 32 60 58 Greece Ireland Portugal Spain Italy Cyprus Total Net exposu
Slide 56: Exposure to European sovereign risks
Annex – Risks Exposure to European sovereign risks1 (in €m) as at March 31, 2013 based on the model drawn up by the EBA2 Millions of euros All values in million EUR Indirect Provisions and Direct sovereign Net direct exposure, excluding derivatives, at at sovereign write-off on exposure in Net direc
Slide 57: Exposure to countries subject to a rescue plan
Annex - Risks Exposure to countries subject to a rescue plan Exposure1 to countries subject to a rescue plan at March 31, 2013 (in €bn) Of which Total banking Of which Of which in billions of euros sovereign portfolio corporates "others" debt Cyprus 0.2 0.1 0.1 0.0 Greece 0.4 0.0 0.4 0.0 Ireland 2.0
Slide 58: Summary of sensitive exposures (FSF report)
Annex - Groupe BPCE FSF report at March 31, 2013 Summary of sensitive exposures Groupe BPCE Total Total in millions of euros Natixis (excl. Natixis) March 31, 2013 Dec. 31, 2012 Net exposure CDOs of ABS (Asset-backed Securities) US residential market 0 120 120 126 Net exposure 1,105 3,152 4,257 4,57
Slide 59: May 6, 2013 Results for the 1 st quarter of 2013
May 6, 2013 Results for the 1st quarter of 2013 59