Natixis — Groupe BPCE — Q1 2020 Earnings Presentation
65 slides from Natixis's earnings presentation, May 6, 2020
Slide 1: Results for 1st quarter of 2020
Results for 1st quarter of 2020 May 6, 2020
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 In the current crisis, Groupe BPCE fully committed to provide support Commitment to its customers, employees and communities CET1 ratio: 15.5%(1), +464bps over MDA Strong capital positions Leverage ratio: 5.2%(1,2) LCR managed at a high level of caution: 138%(3) Sound liquidity position
Slide 4: Covid-19 (1/4): Groupe BPCE entered this crisis well prepared
Covid-19 (1/4) Groupe BPCE entered this crisis well prepared, to support its clients and the French economy Figures as at December 31, 2019 Very high Very solid Responsive Efficient Digital-Inside solvency ratios liquidity position organization strategy CET1 ratio: 15.6%(1) LCR(2): 141% Strength of
Slide 5: Covid-19 (2/4): Government and institutional policy measures
Covid-19 (2/4) The French Government, European Institutions and other countries are taking strong fiscal, monetary and regulatory policy measures to offset the impacts of the pandemic on the economic and financial environments France Loans to corporates and small businesses, guaranteed by the State
Slide 6: Covid-19 (3/4): Support to customers and employees
Covid-19 (3/4) Groupe BPCE mobilizes all its resources to provide support to its customers and employees Provide support to all our customers Adapt our organization Support solidarity and citizens' initiatives INDIVIDUAL CUSTOMERS ACTIVE FINANCIAL SUPPORT FOR THE HEALTH SECTOR... ʘ Strengthening of
Slide 7: Covid-19 (4/4): Leadership in mobile banking during lockdown
Covid-19 (4/4) Groupe BPCE’s leadership in France in terms of mobile banking during the lockdown highlighted by the D-Rating agency Immediate adaptation measures Key figures Q1-20 to ensure business continuity PRIORITY GIVEN TO SERVICE QUALITY AND ONLINE BANKING SECURITY Digital NPS +42 +2pts 4.4/5
Slide 8: Results of Groupe BPCE, Capital and liquidity, Results of the business lines
1 Results of Groupe BPCE 2 Capital and liquidity 3 Results of the business lines 4 Conclusion 8 RESULTS FOR 1ST QUARTER OF 2020
Slide 9: Q1-20 results – Restated figures
Q1-20 results – Restated figures Resilient revenues, costs under control and rise in cosk of risk Restated figures Q1-20 Q1-19 % Change €m Net banking income 5,543 5,778 (4.1)% Operating expenses (4,546) (4,563) (0.4)% Note on methodology Following the announced sale of o/w expenses excluding SRF (4
Slide 10: Q1-20 results – Exceptional items
Q1-20 results – Exceptional items Bulk of the transformation costs incurred in 2018 and 2019 Exceptional items in Q1-20 mostly on Coface, last major step in streamlining €m Q1-20 Q1-19 Contribution to the insurance guarantee fund Net banking income Insurance (7) Revaluation of assets associated with
Slide 11: Q1-20 results – Underlying figures
Q1-20 results – Underlying figures Resilient underlying performance despite the severe context Underlying figures Q1-20 Q1-19 % Change €m Net banking income 5,552 5,772 (3.8)% Operating expenses (4,484) (4,426) 1.3% o/w expenses excluding SRF (4,080) (4,050) 0.7% Gross operating income 1,068 1,346 (
Slide 12: Cost of risk / Asset quality (1/2)
Q1-20 results – Cost of risk/ Asset quality (1/2) Increased cost of risk in Q1-20, with provisions related to the beginning of the crisis, lowered by a positive methodological effect COST OF RISK(1) (in bps) 22 20(2) Ratio of non-performing loans/gross loan outstandings BP 17 15 19 network 2.8% 2.7%
Slide 13: Cost of risk / Asset quality (2/2)
Q1-20 results – Cost of risk/ Asset quality (2/2) Sound and diversified portfolio, with substantial retail exposure Substantial retail exposure (~40%) Limited exposure to sectors considered as sensitive Breakdown of gross exposure per Exposure at March 31, 2020(1) counterparty at March 31, 2020(1) O
Slide 14: Results of Groupe BPCE, Capital and liquidity, Results of the business lines
1 Results of Groupe BPCE 2 Capital and liquidity 3 Results of the business lines 4 Conclusion 14 RESULTS FOR 1ST QUARTER OF 2020
Slide 15: Capital and Loss-absorbing Capacity (1/2)
Capital and Loss-absorbing Capacity (1/2) Sizable buffers to absorb the impact of the crisis CHANGE IN THE CET1 RATIO (in bps) 15.6%(1) +5bps +13bps 15.5%(2) (15)bps (13)bps Requirements Requirements Actual levels (7)bps (1)bp Dec. 31, 2019 April 2020 as of at Jan. 1, 2020 March 31, 2020(1,2) CET1 r
Slide 16: Capital and Loss-absorbing Capacity (2/2)
Capital and Loss-absorbing Capacity (2/2) Groupe BPCE CET1: very significant buffer over MDA of 464 bps Already significant buffer over MDA increased by 47 bps due to regulatory decisions Of which, cancellation or reduction of CCyBs (notably France and UK): 22bps benefit Of which, application of art
Slide 17: Liquidity (1/2)
Liquidity (1/2) Strong liquidity position: a key asset to face the current crisis Total liquidity reserves(1) of Groupe BPCE (in €bn) LCR managed at a high level of caution, well above regulatory requirements 247 231 ʘ Decision to monitor the crisis, in a first step, by using our comfortable 69 81 C
Slide 18: Liquidity (2/2)
Liquidity (2/2) Half of the 2020 medium-/long-term funding plan completed YTD(1,2) MLT wholesale funding: 2020 plan Structure of MLT wholesale funding ʘ €20bn to €21bn(1) raised YTD(3) €2.6bn of senior non-preferred debt Unsecured bond €8.4bn of senior preferred debt issues €9bn to €10bn of co
Slide 19: Results of Groupe BPCE, Capital and liquidity, Results of the business lines
1 Results of Groupe BPCE 2 Capital and liquidity 3 Results of the business lines 4 Conclusion 19 RESULTS FOR 1ST QUARTER OF 2020
Slide 20: Retail Banking & Insurance
Retail Banking & Insurance Revenues +2%, driven by good levels of activity Loan outstandings: €559bn, +8.4% YoY On-balance sheet deposits & savings(2): o/w residential mortgages +8.2% YoY €482bn, +11.5% YoY o/w consumer loans +6.5%(1) YoY o/w sight deposits +15.6% YoY o/w equipment loans +7.3% YoY N
Slide 21: Retail Banking & Insurance – Banques Populaires
Retail Banking & Insurance – Banques Populaires Strong commercial momentum; revenues remain sound LOAN OUTSTANDINGS in €bn EVOLUTION OF PRODUCTION (as % YoY) DEPOSITS & SAVINGS in €bn +8.7% 297 +7.4% 24.8% 273 21.9% 20.1% 228 Residential mortgages 70 15.3% Off-balance sheet D&S 74 213 8.6% (5.0)% Ce
Slide 22: Retail Banking & Insurance – Caisses d'Epargne
Retail Banking & Insurance – Caisses d’Epargne Good business drive; operating expenses well under control LOAN OUTSTANDINGS in €bn EVOLUTION OF PRODUCTION (as % YoY) DEPOSITS & SAVINGS in €bn +5.3% 446 +8.1% 40.8% 424 33.4% 23.7% 134 295 Residential mortgages 135 13.6% Off-balance sheet D&S 273 (2.3
Slide 23: Retail Banking & Insurance – FSE
Retail Banking & Insurance – FSE (Financial Solutions & Expertise) Continued strong business momentum resulting in good Q1 results Breakdown of revenues per business line in Q1-20 Business activities ʘ Consumer credit: personal loan outstandings ~€25bn, +8% vs. end-March 19 8% 8% 24% Consumer credit
Slide 24: Retail Banking & Insurance – Insurance
Retail Banking & Insurance - Insurance Scope: Insurance division of Natixis Good level of commercial activities in Q1-20 Life(2) and Personal protection insurance Premiums(2) In €bn Life insurance AuMs(2) ʘ Total AuMs at €67.8bn at end-March 2020 68.4 67.8 €2.6bn of gross inflows in Q1-20 o/w 37% in
Slide 25: Retail Banking & Insurance – Payments / Oney Bank
Retail Banking & Insurance – Payments / Oney Bank PAYMENTS Scope: Payments division of Natixis Net revenues: strong acceleration across all business lines with net revenues up +13% YoY Underlying figures(1) Q1-20 % Change over the first two months €m ʘ Payment Processing & Services: number of card t
Slide 26: Asset & Wealth Management
Asset & Wealth Management Net revenues up 9% YoY excl. seed money AM net flows(2) on LT products: ~€(8)bn in Q1-20 excl. Life Insurance Asset Management: Assets under management(1) (in €bn) General Accounts, o/w : 934 ʘ European affiliates(2): ~€(2)bn (balanced products). Growth equity, real asset a
Slide 27: Corporate & Investment Banking
Corporate & Investment Banking Revenue diversification together with a tight control on expenses A diversified revenue mix Net revenues(1) (in €m) Net revenues: excl. CVA/DVA and other would have been down 7% YoY 800 Change Global markets: 741 Q/Q 87 104 Investment banking ʘ FICT: revenues up a stro
Slide 28: Results of Groupe BPCE, Capital and liquidity, Results of the business lines
1 Results of Groupe BPCE 2 Capital and liquidity 3 Results of the business lines 4 Conclusion 28 RESULTS FOR 1ST QUARTER OF 2020
Slide 29: Conclusion
Conclusion Strong capital and liquidity positions Revenues down 3.8% and costs under control +0.7%(1) Business model with local presence and close customers relationships Cost of risk reflecting first effects of the crisis Efficient Digital-Inside strategy Groupe BPCE well prepared to face Resilient
Slide 30: Annexes
Annexes 30 RESULTS FOR 1ST QUARTER OF 2020
Slide 31: Content
Annexes Content Consolidated results of Groupe BPCE Retail Banking & Insurance ʘ Note on methodology ʘ Income statement and quarterly series ʘ Reconciliation of restated data to reported data ʘ Banque Populaire and Caisse d’Epargne – quarterly series ʘ Income statement: reconciliation of alternative
Slide 32: Note on methodology (1/4)
Annexes Note on methodology (1/4) Presentation of restated quarterly results Restatement of the impact of IFRIC 21 Following the project announced on February 25, 2020 for the sale of a The results, cost/income ratios and ROE, after being restated 29.5% stake in Coface and for financial communicatio
Slide 33: Note on methodology (2/4)
Annexes Note on methodology (2/4) Operating expenses Business line performance presented using The operating expenses correspond to the aggregate total of the Basel 3 standards “Operating Expenses” (as presented in the Group’s registration The accounting ROE of Groupe BPCE is the ratio between docum
Slide 34: Note on methodology (3/4)
Annexes Note on methodology (3/4) Capital adequacy This amount is comprised of the following 4 items: Common Equity Tier 1 is determined in accordance with the applicable ʘ Common Equity Tier 1 in accordance with the applicable CRR/CRD IV rules, after deduction, following the instructions of the CRR
Slide 35: Note on methodology (4/4)
Annexes Note on methodology (4/4) Liquidity Total liquidity reserves comprise the following: Digital indicators ʘ Central bank-eligible assets include: ECB-eligible securities not The number of users of BP/CE apps corresponds to the number of eligible for the LCR, taken for their ECB valuation (afte
Slide 36: Reconciliation of restated data to reported data
Annexes Reconciliation of restated data to reported data GROUPE GROUPE BPCE BPCE In millions of euros Q1-20 Coface Q1-20 Q1-19 Coface Q1-19 reported restated reported restated Net banking income 5,543 5,543 5.963 (175) 5,778 Operating expenses (4,546) (4,546) (4.686) 123 (4,563) Gross operating inco
Slide 37: Restated Q1-20 results excluding Coface: reconciliation
Annexes Restated Q1-20 results excluding Coface: reconciliation of alternative performance measures to reported data Net banking Operating Share in net Income Net income income expenses income before tax attributable of associates to equity holders In millions of euros of the parent Restated Q1-20 r
Slide 38: Restated Q1-19 results: reconciliation
Annexes Restated Q1-19 results: reconciliation of alternative performance measures to reported data Net banking Operating Cost of risk Share in Gains or Goodwill Income Net income income expenses income of losses before tax attributable equity- on other to equity accounted assets holders In millions
Slide 39: Exceptional items and IFRIC effects per business line
Annexes Exceptional items and IFRIC 21 effects per business line: Q1-20 vs. Q1-19 Q1-20 RETAIL BANKING AWM CIB CORPORATE GROUPE BPCE In millions of euros & INSURANCE CENTER Impact of exceptional items (54) (31) (85) Impact of IFRIC 21 (90) (4) (28) (304) (426) Total impact on Income before tax (144)
Slide 40: Groupe BPCE: restated quarterly income statement per business line
Annexes Groupe BPCE: restated quarterly income statement per business line CORPORATE RETAIL BANKING ASSET & WEALTH CORPORATE GROUPE & INVESTMENT & INSURANCE MANAGEMENT CENTER BPCE BANKING Restated figures Q1-20 Q1-19 Q1-20 Q1-19 Q1-20 Q1-19 Q1-20 Q1-19 Q1-20 Q1-19 % In millions of euros Net banking
Slide 41: Groupe BPCE: restated quarterly series
Annexes Groupe BPCE: restated quarterly series GROUPE BPCE Restated figures Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 5,778 5,935 5,757 6,123 5,543 Operating expenses (4,563) (4,051) (4,011) (4,441) (4,546) Gross operating income 1,215 1,884 1,746 1,682 997 Cost of risk (
Slide 42: Consolidated balance sheet
Annexes Consolidated balance sheet ASSETS LIABILITIES March 31, 2020 Dec. 31, 2019 March 31, 2020 Dec. 31, 2019 (in millions of euros) (in millions of euros) Cash and amounts due from central banks 93,541 80,244 Amounts due to central banks Financial assets at fair value through profit or loss 213,9
Slide 43: Statement of changes in shareholders' equity
Annexes Statement of changes in shareholders' equity Equity attributable to equity In millions of euros holders of the parent December 31, 2019 69,909 Distributions - Capital increase (cooperative shares) 574 Redemption of super-subordinated notes (TSSDI) - Remuneration of super-subordinated notes (
Slide 44: Financial structure: changes in regulatory capital and fully-loaded ratios
Annexes Financial structure : changes in regulatory capital and fully-loaded ratios Reconciliation of shareholders’ equity to total capital(1) Regulatory capital(1) (in €bn) 79.6 78.3 In billions of euros March 31, 2020 Dec.31, 2019 13.65 13.0 Equity attribuable to equity holders of the parent 70.6
Slide 45: Financial structure: prudential ratios and credit ratings
Annexes Financial structure: prudential ratios and credit ratings Long-term SENIOR PREFERRED credit ratings March 31, 2020(1)(2) Dec. 31, 2019(1) Dec. 31, 2018(3) (May 6, 2020) Total risk-weighed assets €422bn €422bn €392bn A+ rating watch negative Common Equity Tier-1 capital €65.3bn €66.0bn €62.2b
Slide 46: TLAC / MREL ratio
Annexes TLAC / MREL ratio TLAC(1,2) RATIO (as a % of risk-weighted assets) MREL(1,2) RATIO (as a % of risk-weighted assets) 29.8% 23.4% 6.4% 23.5% 19.5% 4.6% 4.6% Eligible Senior preferred debt 3.3% Senior non-preferred 3.3% Senior non-preferred Tier 2 Tier 2 Additional Tier 1 Additional Tier 1 CET1
Slide 47: Risk-weighed assets
Annexes Risk-weighed assets BREAKDOWN PER BUSINESS LINE (in €bn) BREAKDOWN PER TYPE OF RISK(1) (in €bn) 422 422 422 422 15% 14% Other 9% 9% 3% 3% 15% 15% 3% 3% Corporate & Operational Risk Investment Banking 88% 88% Market Risk 67% 68% Asset & Wealth Credit Risk Management Retail Banking & Insurance
Slide 48: Leverage ratio
Annexes Leverage ratio(1) 03/31/2020 12/31/2019 In billions of euros Tier-1 capital 65.3 66.0 Balance sheet total 1,358.6 1,338.1 Prudential restatements (107.3) (112.9) Prudential balance sheet total(2) 1,251.4 1,225.2 Adjustments related to exposure to derivates (4) (56.0) (38.3) Adjustments relat
Slide 49: Financial conglomerate
Annexes Financial conglomerate FINANCIAL CONGLOMERATE RATIO CRR/CRD IV(2) viewpoint Restatements Financial conglomerate viewpoint +0.6 Banking CR (1) (CRR/CRD IV) Regulatory capital + Total capital (in €bn) 78.2 78,241 78,869 78,869 78.9 Insurance CR(1) (Solvency 2) RESTATEMENTS APPLIED - 1 2 3 +4.9
Slide 50: Retail Banking & Insurance: quarterly income statement
Annexes Retail Banking & Insurance: quarterly income statement BANQUE CAISSE FINANCIAL OTHER RETAIL BANKING POPULAIRE D'EPARGNE SOLUTIONS INSURANCE PAYMENTS NETWORKS & INSURANCE NETWORK NETWORK & EXPERTISE Q1-20 Q1-19 % Q1-20 Q1-19 % Q1-20 Q1-19 % Q1-20 Q1-19 % Q1-20 Q1-19 % Q1-20 Q1-19 % Q1-20 Q1-1
Slide 51: Retail Banking & Insurance: quarterly series
Annexes Retail Banking & Insurance: quarterly series RETAIL BANKING & INSURANCE Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 4,070 4,099 3,972 4,176 4,140 Operating expenses (2,694) (2,690) (2,596) (2,863) (2,803) Gross operating income 1,376 1,408 1,376 1,313 1,337 Cost/inc
Slide 52: Banque Populaire and Caisse d'Epargne networks quarterly series
Annexes Retail Banking & Insurance: Banque Populaire and Caisse d’Epargne networks quarterly series BANQUE POPULAIRE NETWORK Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 1,618 1,626 1,568 1,622 1,602 Operating expenses (1,086) (1,099) (1,065) (1,106) (1,093) Gross operating
Slide 53: Retail Banking & Insurance
Annexes Retail Banking & Insurance DEPOSITS & SAVINGS (in €bn) LOAN OUTSTANDINGS (in €bn) Change YoY Change YoY 764.6 713.7 +7.1% +8.4% 558.7 204.7 515.5 177.1 +15.6% Sight deposits 318.1 189.4 +4.0% Passbook savings accounts 293.9 182.1 +2.0% Regulated home savings plans 79.0 80.6 +22.5% Term accou
Slide 54: Retail Banking & Insurance: Banque Populaire network
Annexes Retail Banking & Insurance: Banque Populaire network DEPOSITS & SAVINGS (in €bn) LOAN OUTSTANDINGS (in €bn) Change YoY Change YoY +8.7% +7.4% 297.0 273.3 228.3 212.6 103.1 90.4 +14.0% Sight deposits 132.3 123.2 +6.5% Passbook savings accounts 57.1 53.7 +2.4% Regulated home savings plans 21.5
Slide 55: Retail Banking & Insurance: Caisse d'Epargne network
Annexes Retail Banking & Insurance: Caisse d’Epargne network DEPOSITS & SAVINGS (in €bn) LOAN OUTSTANDINGS (in €bn) Change YoY Change YoY +5.3% +8.1% 446.5 423.9 93.4 79.4 294.8 272.7 +17.5% Sight deposits +2.9% Passbook savings accounts 127.6 131.2 +1.9% Regulated home savings plans 181.4 167.3 +35
Slide 56: Retail Banking & Insurance: FSE quarterly series
Annexes Retail Banking & Insurance: FSE quarterly series FINANCIAL SOLUTIONS & EXPERTISE Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 272 279 268 298 290 Operating expenses (155) (152) (155) (172) (160) Gross operating income 117 127 113 126 130 Cost/income ratio 57.0% 54.5%
Slide 57: Retail Banking & Insurance: Insurance quarterly series
Annexes Retail Banking & Insurance: Insurance quarterly series INSURANCE Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 218 207 205 216 221 Operating expenses (125) (116) (112) (125) (134) Gross operating income 93 92 93 90 87 Cost/income ratio 57.5% 55.8% 54.6% 58.1% 60.6% In
Slide 58: Retail Banking & Insurance: Payments quarterly series
Annexes Retail Banking & Insurance: Payments quarterly series PAYMENTS Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 103 105 103 111 113 Operating expenses (88) (94) (93) (96) (94) Gross operating income 16 11 10 15 18 Cost/income ratio 84.8% 89.6% 90.1% 86.1% 83.8% Income be
Slide 59: Retail Banking & Insurance: Other networks quarterly series
Annexes Retail Banking & Insurance: Other networks quarterly series OTHER NETWORKS Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 81 81 84 203 199 Operating expenses (58) (64) (60) (147) (143) Gross operating income 24 17 25 56 56 Cost/income ratio 70.9% 79.3% 70.8% 72.4% 71.8
Slide 60: Asset & Wealth Management: quarterly series
Annexes Asset & Wealth Management: quarterly series ASSET & WEALTH MANAGEMENT Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 773 932 945 1,109 774 Operating expenses (558) (605) (648) (681) (579) Gross operating income 216 327 297 428 195 Cost/income ratio 72.1% 64.9% 68.5% 61
Slide 61: Corporate & Investment Banking: quarterly series
Annexes Corporate & Investment Banking: quarterly series CORPORATE & INVESTMENT BANKING Q1-19 Q2-19 Q3-19 Q4-19 Q1-20 In millions of euros Net banking income 807 847 784 899 688 Operating expenses (582) (523) (527) (602) (557) Gross operating income 225 324 256 297 130 Cost/income ratio 72.2% 61.8%
Slide 62: Corporate center: restated quarterly series
Annexes Corporate center: restated quarterly series CORPORATE CENTER Restated figures Q1-19 Q2-19pf Q3-19pf Q4-19 Q1-20 In millions of euros Net banking income 127 57 56 (61) (58) Operating expenses (729) (232) (239) (295) (606) Gross operating income (601) (175) (183) (356) (665) Cost of risk (8) (
Slide 63: Non-performing loans and impairments
Annexes Non-performing loans and impairments March 31, 2020 Dec.31, 2019 Dec. 31, 2018 In billions of euros Gross outstanding loans to customers and credit institutions 809.5 795.8 763.1 O/w S3 outstandings 21.5 21.6 21.5 Non-performing/gross outstanding loans 2.7% 2.7% 2.8% S3 impairments recognize
Slide 64: Breakdown of gross exposure at March 31, 2020
Annexes Breakdown of gross exposure at March 31, 2020(1) BREAKDOWN PER COUNTERPARTY BREAKDOWN PER GEOGRAPHICAL REGION Financial institutions/local Central administrations/ Corporate governments Central banks and other customers sovereign exposures 5% 1% 3% 1% 4% 3% 27% 8% 5% 8% 13% 11% 7% 14% 4% 7%
Slide 65: groupebpce.com
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