Natixis — Groupe BPCE — FY2010 Earnings Presentation
65 slides from Natixis's earnings presentation, Feb 23, 2011
Slide 1: Results for the full year and 4th quarter of 2010
February 23, 2011 Results for the full year and 4th quarter of 2010
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: 2010: Sound results, ahead of the schedule laid down in the strategic plan
2010: Sound results, ahead of the schedule laid down in the strategic plan Revenue growth in all core businesses: + 10% à €23.4bn Sharp improvement in operational efficiency: 8-point reduction in the cost/income ratio, now standing at 68.7%; €433m of cost synergies realized, ahead of the €1bn target
Slide 4: Contents
Contents 1. Results of Groupe BPCE 2. Results of the core business lines FEBRUARY 23, 2011 RESULTS FOR THE FULL YEAR AND 4TH QUARTER OF 2010 4
Slide 5: Net income attributable to equity holders of the parent: €3.6bn
1. Net income attributable to equity holders of the parent: €3.6bn, multiplied by a factor of 7 since 2009 Core bus. Core bus. 2010/ 2010/ in millions of euros 2010 2009 lines* lines* 2009 2009 2010 2009 Net banking income 23,359 21,227 + 10% 20,886 19,140 + 9% Operating expenses - 16,057 - 16,359 -
Slide 6: Quarterly change in net income
1. Quarterly change in net income (in €m) Q1-09 Q2-09 Q3-09 Q4-09 Q1-10 Q2-10 Q3-10 Q4-10 2009 2010 3,876 2,108 1,108 926 936 906 Sharp improvement in 670 562 the earning capacity of 434 442 the core business lines 79 14 23 21 21 Recovery in the net -15 income from Equity interests -46 -51 -41 -153
Slide 7: Quarterly result: net income of the core business lines multiplied by two
1. Quarterly result: net income of the core business lines multiplied by a factor of two Core Core Q4-10/ bus. bus. Q4-10/ in millions of euros Q4-10 Q4-09 Q4-09 lines* lines* Q4-09 Q4-10 Q4-09 Net banking income 5,952 6,099 - 2% 5,453 4,969 + 10% Operating expenses - 4,304 - 4,352 - 1% - 3,566 - 3,
Slide 8: Strong revenue growth in 2010: +10%
1. Strong revenue growth in 2010: + 10% 9% growth in the net banking income Additional net banking income of €262m generated by the core business lines generated at the end of 2010 between Natixis and the Banque Populaire and 19,140 20,886 Caisse d’Epargne networks 15,099 2013 target 14,012 €262m €8
Slide 9: Improvement in operational efficiency: 8-point reduction in cost/income ratio
1. Improvement in the group’s operational efficiency: 8-point reduction in the cost/income ratio Cost/income ratio of the core business lines Realization of cost synergies ahead of down 6 points schedule vis-à-vis the strategic plan: €433m of synergies realized by end 2010 71% 68% 70% 65% 63% 64% €4
Slide 10: Sharp decline in cost of risk: -60%
1. Sharp decline in cost of risk: - 60% Groupe BPCE (in bp*) 44 39 34 > 2010 cost of risk: €1,654m, down 31 18 60% vs. 2009 (in €m) 567 511 459 245 ** 439 Groupe BPCE • 48% decline for core business lines • Division by a factor of 10 for activities managed on a run-off basis (in bp*) 33 32 31 28 25
Slide 11: Reduction in the group's risk profile
1. Reduction in the group’s risk profile Workout Portfolio Management: Risk-weighted asset trend (in €bn) Division by almost 50% of the impact - 44% of segregated assets since the group was created > Sale of complex credit derivatives (reduction of more than €6bn in risk-weighted assets in 29.7 27.5
Slide 12: Closely managed change in risk-weighted assets
1. Closely managed change in the group’s risk-weighted assets Change in risk-weighted assets* (in €bn) - 3% Risk-weighted assets: €400bn* down 3% compared with 427 December 31, 2009 414 409 411 414 397 400 30/ 06/ 09 30/ 09/ 09 31/ 12/ 09 31/ 03/ 10 3 0 / 0 6 / 1 0** 30/ 09/ 10 31/ 12/ 10 2010 chang
Slide 13: Regular improvement in capital adequacy ratios since creation
1. Regular improvement in the group’s capital adequacy ratios since its creation 10 .0 % 9 .6 % 9 .7% 9 .5% Final reimbursement of the French 8 .6 % 8 .8 % 9 .1% 8 .0 % state, ahead of strategic plan deadline 7.3 % 7.4 % 7.8 % 6 .9 % 6 .6 % 6 .4 % > €1.2bn in preference shares 39.3 4 1. 0 39.5 37.6
Slide 14: Funding
1. Funding Abundant and diversified medium-/long-term MLT funding structure in 2010 funding > €40.8bn of funding raised in 2010 • BPCE funding pool : €23.5bn • Crédit Foncier funding pool : €17.3bn Bond issues placed in the BP and CE networks 13% > Access to diversified sources of funding Obligation
Slide 15: Ahead of schedule for financial targets of the strategic plan
1. The group is ahead of schedule for the attainment of the financial targets defined in the strategic plan Net banking income target (in €bn) Cost/income ratio target CAGR approx. 5% 77% > €25bn €23.4bn - 11 pts 69% €21.2bn 66% 2009 2010 2013 target 2009 2010 2013 target Profitability of core busin
Slide 16: BPCE is committed to the development of a responsible economy
1. BPCE is committed to the development of a responsible economy Major player in the French economy: + 8% loan outstandings in 2010 + 11% loan outstandings granted to local authorities in 2010 + 10% loan outstandings granted to French households in 2010 + 5% loan outstandings granted to SMEs and mic
Slide 17: Contents
Contents 1. Results of Groupe BPCE 2. Results of the core business lines FEBRUARY 23, 2011 RESULTS FOR THE FULL YEAR AND 4TH QUARTER OF 2010 17
Slide 18: Commercial Banking and Insurance: Buoyant commercial activity
2. Commercial Banking and Insurance Buoyant commercial activity Net banking income (in €m) Buoyant commercial activity > Growth in the customer base across all the 15,099 14,012 priority customer targets (active customers) 981 1,10 4 987 1,0 0 4 > Strong new loan production in all market 6 ,10 7 6 ,
Slide 19: Banque Populaire banks
2. Commercial Banking and Insurance Banque Populaire banks Loan outstandings (in €bn) Priority customer base (active customers) 139.8 146.1 136.4 > Active individual customers: + 1.4% 63.8 65.3 > Established professionals: + 3.2% 63.3 > Corporate customers: + 12.1% 73.1 76.0 80.8 Loan outstandings:
Slide 20: Caisses d'Epargne
2. Commercial Banking and Insurance Caisses d’Epargne Loan outstandings (in €bn) Priority customer base (active customers) 155.0 137.3 > Active Individual customers: + 2.2% 127.9 62.2 > Professionals: + 10% 48.3 54.7 > Corporate customers: + 13% 92.8 Loan outstandings: + 13% 79.6 82.6 > Individual c
Slide 21: Real estate financing
2. Commercial Banking and Insurance Real estate financing Crédit Foncier Aggregate new loan production of €16.7bn in 2010 (+ 14% vs. 2009) > Individual customer market: new loan production of €9.9bn • Advantage taken of Crédit Foncier’s historical presence in the first-time buyer’s and real estate i
Slide 22: Insurance, International and Other networks
2. Commercial Banking and Insurance Insurance, International and Other networks Insurance* International BPCE International et Outre-mer Individual life insurance > Revenues: + 2% vs. 2009 Growth in loan outstandings > Number of contracts: + 3.8% vs. 2009 and savings deposits** > Strong growth in un
Slide 23: Commercial Banking and Insurance
2. Commercial Banking and Insurance 2010/ Q4-10/ in millions of euros 2010 2009 Q4-10 Q4-09 2009 Q4-09 Net banking income 15,099 14,012 + 8% 3,948 3,716 + 6% Banque Populaire banks 6,236 5,920 + 5% 1,623 1,566 + 4% Caisses d’Epargne 6,772 6,107 + 11% 1,768 1,652 + 7% Real estate financing 987 1,004
Slide 24: Natixis' core business lines: CIB
2. Natixis’ core business lines: CIB, Investment Solutions and SFS Strong growth in net banking income (+ 13 %) and restored profitability (net income multiplied by 4) CIB : dynamic commercial activity NBI + 12 % NBI (in M€) > Debt and Financing: a record year • Very strong revenue growth in Q4-10 :
Slide 25: Natixis' core business lines: Investment Solutions
2. Natixis’core business lines : CIB, Investment Solutions and SFS Strong growth in net banking income (+ 13 %) and restored profitability (net income multiplied by 4) Investment Solutions : increase in assets under management and strong activity for Insurance and Private Banking Assets under manage
Slide 26: Natixis' core business lines: SFS
2. Natixis’core business lines : CIB, Investment Solutions and SFS Strong growth in net banking income (+ 13 %) and restored profitability (net income multiplied by 4) SFS : NBI + 10 % Activity indicators Var. 2010 2009 > Specialized financing : NBI + 14 % with a Consumer Finance Services buoyant ac
Slide 27: CIB, Investment Solutions, and SFS
2. CIB, Investment Solutions, and SFS 2010/ Q4-10/ in millions of euros 2010 2009 Q4-10 Q4-09 2009 Q4-09 Net banking income 5,787 5,128 + 13% 1,505 1,253 + 20% CIB 3,027 2,697 + 12% 731 603 + 21% Investment Solutions 1,800 1,560 + 15% 502 427 + 18% SFS 960 871 + 10% 272 223 + 22% Operating expenses
Slide 28: Equity interests: good performance
2. Equity interests: good performance Coface 2010 confirms the recovery made by Coface 2010 net banking income multiplied by 2 vs. 2009 Continued decline in the loss ratio in Q4-10 > 38% in Q4-10 vs. 53% in Q3-10 and 63% in Q4-09 Foncia Nexity Revenues: €580m, + 7% vs. 2009 Revenues of €2,747m, refl
Slide 29: Equity interests
2. Equity interests 2010/ Q4-10/ in millions of euros 2010 2009 Q4-10 Q4-09 2009 Q4-09 Net banking income 2,329 1,699 + 37% 669 491 + 36% Operating expenses -1,995 -1,919 + 4% -559 -496 + 13% Gross operating income 334 -220 n.s 110 -5 n.s Cost of risk -34 -21 n.s -16 -7 n.s Income before tax 289 -21
Slide 30: Annexes
February 23, 2011 Results for the full year and 4th quarter of 2010 Annexes
Slide 31: Annexes
Annexes Groupe BPCE CIB, Investment Solutions and SFS > Organizational structure of Groupe BPCE > Income statement per business line > Income statement per business line > Consolidated balance sheet Equity interests > Goodwill > Income statement Financial structure Workout Portfolio Management > Sta
Slide 32: Organizational structure of Groupe BPCE at December 31, 2010
Annex - Groupe BPCE Organizational structure of Groupe BPCE at December 31, 2010 FEBRUARY 23, 2011 RESULTS FOR THE FULL YEAR AND 4TH QUARTER OF 2010 32
Slide 33: Annual income statement per business line
Annex - Groupe BPCE Annual income statement per business line Commercial CIB, Investment Workout portfolio Total core banking & Solutions & Equity interests management & Groupe BPCE businesses Insurance Specialized other businesses Financial Services In millions of euros 2010 2009 2010 2009 2010 200
Slide 34: Quarterly income statement per business line
Annex - Groupe BPCE Quarterly income statement per business line Commercial CIB, Investment Workout portfolio Total core banking & Solutions & Equity interests management & Groupe BPCE businesses Insurance Specialized other businesses Financial Services In millions of euros Q4-10 Q4-09 Q4-10 Q4-09 Q
Slide 35: Quarterly income statement
Annex - Groupe BPCE Quarterly income statement Groupe BPCE Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 3 641 6 053 5 434 6 099 21 227 5 973 5 973 5 461 5 952 23 359 2 132 10% Operating expenses -4 049 -3 992 -3 966 -4 352
Slide 36: Consolidated balance sheet
Annex - Groupe BPCE Consolidated balance sheet December December December December In millions of euros In millions of euros 31, 2010 31, 2009 31, 2010 31, 2009 Cash and amounts due from central banks 24 143 13 069 Amounts due to central banks 490 214 Financial assets at fair value through profit or
Slide 37: Goodwill
Annex - Groupe BPCE Goodwill Dec. 31, Other Dec. 31, in millions of euros Disposals Reclassifications 2009 movements 2010 Commercial Banking and 1,453 - 587 + 117 - 24 959 Insurance’s entities Natixis 2,654 -6 - 117 + 102 2,633 Equity interests 1,563 -4 +9 1,568 TOTAL 5,670 - 597 - + 87 5,160 * Impa
Slide 38: Statement of changes in shareholders' equity
Annex - Financial structure Statement of changes in shareholders' equity Equity attributable in millions of euros to equity holders of the parent December 31, 2009 43,988 Distribution - 501 Capital increase (cooperative shares)* 3,543 Income 3,640 Remuneration of deeply subordinated notes - 409 Chan
Slide 39: Reconciliation of shareholders' equity to Tier-1 capital
Annex - Financial structure Reconciliation of shareholders' equity to Tier-1 capital in billions of euros - 5.8 + 2.9 - 6.7 - 1.2 + 6.9 - 2.5 45.2 38.8 Equity Cancellation of Minority Goodwill Other Deductions Deeply Total attributable to deeply subordinated interests** & intangibles restatements (5
Slide 40: Change in the T1 ratio in 2010
Annex - Financial structure Change in the T1 ratio in 2010 + 0.6% + 0.9% + 0.2% + 0.2% + 0.1 % - 0.6% - 0.8% 9.7%* 9.1% Tier 1 ratio Capital Buyback Income Buyback SMC disposal Change in Other Tier 1 ratio Dec. 31, 2009 increase of preference for the period of deeply risk-weighted Dec. 31, 2010 (coo
Slide 41: Prudential ratios and credit ratings
Annex - Financial structure Prudential ratios and credit ratings Dec. 31, June 30, Dec. 31, 2010* 2010 2009 Credit risk €355bn €373bn €357bn Market risk €13bn €24bn €24bn Operational risk €32bn €31bn €30bn Total risk-weighted assets €400bn €427bn €411bn Tier-1 capital €38.8bn €41.0bn €37.6bn Tier-1
Slide 42: Commercial Banking and Insurance
Annex - Commercial Banking and Insurance Commercial banking & Insurance Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 3 175 3 521 3 600 3 716 14 012 3 755 3 747 3 649 3 948 15 099 1 087 8% Operating expenses -2 441 -2 422 -2
Slide 43: Banque Populaire banks and Caisses d'Epargne
Annex - Commercial Banking and Insurance Banque Populaire banks and Caisses d'Epargne Banques Populaires Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 1 422 1 438 1 494 1 566 5 920 1 604 1 498 1 511 1 623 6 236 316 5% Operat
Slide 44: Banque Populaire network: loan outstandings
Annex - Commercial Banking and Insurance Banque Populaire network: loan outstandings (in €bn) 146.1 139.8 136.4 + 4.5% + 2.5% 7.1 7.2 7.0 73.1 65.5 68.1 C onsumer loans Real estate loans % Short-term credit fac. change Equipment loans 9.4 9.0 Consumer loans - 1.2% Other 11.3 Real estate loans + 7.5%
Slide 45: Banque Populaire network: savings deposits
Annex - Commercial Banking and Insurance Banque Populaire network: savings deposits (in €bn) 175.8 + 4.4% 183.6 % 165.3 + 6.4% change 43.6 On-balance sheet savings + 7.4% 40.1 39.3 Demand deposits + 8.8% 28.2 Passbook savings accounts + 5.3% 26.8 23.0 Regulated home savings plans + 2.0% 14.5 14.8 14
Slide 46: Caisse d'Epargne network: loan outstandings
Annex - Commercial Banking and Insurance Caisse d'Epargne network: loan outstandings (in €bn) 155.0 + 12.9% 137.3 10.4 127.9 + 7.3% 9.7 9.0 90.3 % C onsumer loans Real estate loans 80.0 change Short-term credit fac. 77.0 Equipment loans Consumer loans + 7.3% Other Real estate loans + 12.9% 7.3 6.3 S
Slide 47: Caisse d'Epargne network: savings deposits
Annex - Commercial Banking and Insurance Caisse d'Epargne network: savings deposits (in €bn) 327.1 335.2 321.8 + 2.5% + 1.6% % 33.1 25.4 30.0 change On-balance sheet savings + 2.2% 116.1 Demand deposits + 10.4% 121.4 115.4 Passbook savings accounts + 0.7% Demand deposits Regulated home savings plans
Slide 48: Real estate financing; Insurance, International and Other networks
Annex - Commercial Banking and Insurance Real estate financing Insurance, International and Other networks Real estate financing Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 227 243 280 254 1 004 242 256 235 254 987 -17 -2%
Slide 49: CIB, Investment Solutions and SFS
Annex - CIB, Investment Solutions and SFS CIB, Investment Solutions & Specialized Financial Services Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 1 280 1 345 1 250 1 253 5 128 1 441 1 505 1 336 1 505 5 787 659 13% Operating
Slide 50: CIB and Investment Solutions
Annex - CIB, Investment Solutions and SFS CIB Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 716 729 649 603 2 697 793 828 675 731 3 027 330 12% Operating expenses -412 -417 -408 -420 -1 657 -418 -408 -387 -442 -1 655 2 0% Gr
Slide 51: Equity interests
Annex – Equity interests Equity interests Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income 356 389 463 491 1 699 518 581 561 669 2 329 630 37% Operating expenses -467 -479 -477 -496 -1 919 -475 -484 -477 -559 -1 995 -76 4% Gros
Slide 52: Workout Portfolio Management and Other Businesses
Annex - Workout Portfolio Management and "Other Businesses" Workout portfolio management & other businesses Change 2010 / 2009 In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 M€ % Net banking income -1 170 798 121 639 388 259 140 -85 -170 144 -244 -63% Operating expens
Slide 53: Workout Portfolio Management and Other Businesses
Annex - Workout Portfolio Management and "Other Businesses" Workout portfolio management Change 2010 / In millions of euros Q1-09 Q2-09 Q3-09 Q4-09 2009 Q1-10 Q2-10 Q3-10 Q4-10 2010 2009 Net banking income -1 235 -698 34 291 -1 608 182 -13 27 141 337 1 945 Operating expenses -42 -39 -32 -55 -168 -42
Slide 54: Groupe BPCE: non-performing loans and impairment
Annex - Risks Groupe BPCE: non-performing loans and impairment Dec. 31, June 30, Dec. 31, in millions of euros 2010 2010 2009 Gross outstanding customer loans 573,807 556,103 528,301 O/W non-performing loans 20,003 20,998 18,858 Non-performing/gross outstanding loans 3.5% 3.8% 3.6% Impairment recogn
Slide 55: Networks: non-performing loans and impairment
Annex - Risks Networks: non-performing loans and impairment Banque Populaire banks (aggregated) in millions of euros Dec. 31, 2010 June 30, 2010 Dec. 31, 2009 Gross outstanding customer loans 151,518 149,120 144,807 O/W non-performing loans 7,531 7,516 6,810 Non-performing/gross outstanding loans 4.
Slide 56: Breakdown of commitments at December 31, 2010
Annex - Risks Breakdown of commitments at December 31, 2010 Breakdown of commitments Breakdown of commitments to Companies per counterparty and Professionals per industrial sector Transportation 2% 30% Tourism-Hotels-Catering 2% Electrical & mec. Construction 2% 8% Communications 2% 7% Food industry
Slide 57: Geographical breakdown of commitments at December 31, 2010
Annex - Risks Geographical breakdown of commitments at December 31, 2010 Banks Sovereigns Corporates 87% 60% 62% 17% 25% 15% 11% 7% 1% 5% 3% 3% 1% 3% France France France Europe excl. France North & South America North & South America North & South America Europe excl. France Europe excl. France Asi
Slide 58: Update of exposure to sovereign risks
Annex - Groupe BPCE * Update of exposure to sovereign risks published at the same time ** as the CEBS stress tests Net exposures Net exposures in millions of euros Gross exposures of which of which December 31, March 31, 2010 Banking book Trading book 2010 Austria 423 9 414 206 0 Belgium 480 262 219
Slide 59: Sensitive exposures (excluding Natixis): Recommendations of the Financial Stability Forum
Annex – Sensitive exposures (excluding Natixis) Recommendations of the Financial Stability Forum Foreword With the exception of the summary on the next page, the following information is based on the scope of consolidation of Groupe BPCE (excluding Natixis) For specific details about the sensitive e
Slide 60: FSF report at Dec. 31, 2010: Summary of sensitive exposures
Annex - Groupe BPCE FSF report at Dec. 31, 2010 Summary of sensitive exposures Groupe BPCE Total Total (excluding Natixis Dec. 31, 2010 Sept. 30, 2010 in millions of euros Natixis) Net exposure ABS CDOs (US residential market) 7 645 652 626 Net exposure Other at-risk CDOs 1,662 3,258 4,920 4,805 Net
Slide 61: Other CDOs (unhedged)
Annex - Sensitive exposures (excluding Natixis) Other CDOs (unhedged) Net Change in Other Net Gross in millions of euros exposure value changes exposure exposure Sept. 30, 10 Q4-10 Q4-10 Dec. 31, 10 Dec. 31, 10 Portfolio at fair value through profit or loss 151 6 -6 151 309 Portfolio at fair value t
Slide 62: CMBS
Annex - Sensitive exposures (excluding Natixis) CMBS Net Change in Other Net Gross in millions of euros exposure value changes exposure exposure Sept. 30, 10 Q4-10 Q4-10 Dec. 31, 10 Dec. 31, 10 Portfolio at fair value through profit or loss 8 - - 8 9 Portfolio at fair value through 84 - -4 80 91 sha
Slide 63: RMBS
Annex - Sensitive exposures (excluding Natixis) RMBS Net Change in Other Net Gross in millions of euros exposure value changes exposure exposure Sept. 30, 10 Q4-10 Q4-10 Dec. 31, 10 Dec. 31, 10 Portfolio at fair valuethrough profit or loss 4 - - 4 5 Portfolio at fair value through 957 - 28 17 946 97
Slide 64: Protection acquired
Annex - Sensitive exposures (excluding Natixis) Protection acquired Credit enhancers (monoline) Protection acquired from credit enhancers by Crédit Foncier de France are not included for the appraisal of hedged instruments (valued at zero) In this respect, it does not therefore reflect exposure to c
Slide 65: LBO financing
Annex - Sensitive exposures (excluding Natixis) LBO financing Breakdown by industry Net exposure at Dec. 31, 2010: €2,780m (vs. €2,904m at Sept. 30, 2010) > Provision: €217m 6.3% 5.6% 4.4% 3.3% Exposure exclusively comprised of shares 18.3% no intended for sale Average commitment per deal: 36.0% €1.