Credit Agricole SA · EURONEXT:ACA
Credit Agricole SA — Exane Conference, Paris, June 2018
46 slides from Credit Agricole SA's conference presentation, Jun 12, 2018
Slide 1: Exane Conference, Paris, June 2018
Xavier Musca Deputy CEO Exane Conference, Paris, 12 June 2018 1 l CONFERENCE PRESENTATION – JUNE 2018
Slide 2: Disclaimer
DISCLAIMER Financial information on Crédit Agricole S.A. and Crédit Agricole Group for the first quarter 2018 comprises this presentation and the attached press release NOTE and financial report which are available on the website https://www.credit-agricole.com/en/finance/finance/financial-publica
Slide 3: Introduction: Major achievements from 2016 to Q1-18
CRÉDIT AGRICOLE S.A. INTRODUCTION Major achievements from 2016 to Q1-18 New Medium Term Plan announced in March 2016: “Strategic Ambition 2020” +8.7% Focus on Group structure simplification, customer project, growth momentum via cross selling Q1/Q1 increase in and enhanced operating efficiency u
Slide 4: Agenda
1 Q1-18 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 21 3 SOLVENCY AND CAPITAL PLANNING p. 34 4 CONCLUSION p. 38 5 APPENDIX p. 40 4 l CONFERENCE PRESENTATION – JUNE 2018
Slide 5: Introduction: Key figures
INTRODUCTION Key figures CREDIT AGRICOLE GROUP CRÉDIT AGRICOLE S.A. Q1-18 Q1-18 €1,429m Net income Group share - stated €856m -10.7% Q1/Q1 +1.2% Q1/Q1 €1,352m Net income Group share - underlying (1) (2) €788m -18.3% Q1/Q1 -12.1% Q1/Q1 -10.1% at constant scope and forex (3) +4.8% at constant scope an
Slide 6: Items affecting net income growth (Q1/Q1)
CRÉDIT AGRICOLE GROUP INTRODUCTION Items affecting net income growth (Q1/Q1) CRÉDIT AGRICOLE S.A. Disposal of non-core entities in 2017 -€143m Significant contributions to net income Group share in Q1-17: Eurazeo (€77m) and BSF (€67m) Q1/Q1 loss of Decline in the share of contributions of equi
Slide 7: Strong dynamics in all activities in Q1-18
CRÉDIT AGRICOLE GROUP INTRODUCTION Strong dynamics in all activities in Q1-18 RETAIL BANKING Regional Banks LCL Italy* Strong credit activity: slowdown in Home loans +7.7% Home loans +4.7% Home loans +6.0% home lending and pick-up in Consumer loans +9.9% Corporate loans +9.1% Corporate loans +7.8%
Slide 8: Increase in underlying net income Q1/Q1
CRÉDIT AGRICOLE S.A. RESULTS Increase in underlying net income Q1/Q1 at constant scope and forex(2) Q1/Q1 change in underlying net income(1), by business line -12.1% 896 +47 845 856 (51) +42 788 (26) (22) (151) +68 Unfavourable Q1/Q1 comparison, especially for LC Decrease in underlying net incom
Slide 9: Good resistance of underlying revenues
CRÉDIT AGRICOLE S.A. RESULTS Good resistance of underlying revenues(1) at constant scope and forex(2) Q1/Q1 change in underlying revenues(1), by business line +2.5% 4,779 +217 +25 +3 +48 4,900 +9 4,909 Positive impact from Pioneer, challenging capital 4,700 (172) markets environment (79) AG: sco
Slide 10: Excellent control of underlying costs
CRÉDIT AGRICOLE S.A. RESULTS Excellent control of underlying costs, down at constant scope and forex(2) excl. SRF Q1/Q1 change in underlying costs(1), by business line +3.7% Costs down significantly at constant scope(2) 3,401 Scope effects(2): Pioneer (equiv. +€132m), 3 Italian banks (+€51m 3,22
Slide 11: Declining and sustainable cost of risk
CRÉDIT AGRICOLE S.A. RESULTS Declining and sustainable cost of risk CRÉDIT AGRICOLE GROUP Cost of credit risk on outstandings (in basis points over a rolling four-quarter period) Assumption 2019: 50bp 41 41 41 140 133 134 140 134 39 123 116 110 112 37 35 CACF Assumption 2019: 35bp 113 -22bp Q1/Q1
Slide 12: Asset gathering
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Asset gathering Assets under management(1) (AuM) (€bn) Contribution to Crédit Agricole S.A. P&L Q1-18 Q1-17 ∆ Q1/Q1 €m +21.9% Mark et & underlying underlying underlying forex effects Insurance 276 268 +2.8% 1,868 +39.8 +1.6 +2.0 1,895 1,555 163 162 Asset man
Slide 13: Insurance
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Insurance Activity indicators Contribution to Crédit Agricole S.A. P&L Protection of assets and individuals Savings/Retirement Q1-18 Q1-17 ∆ Q1/Q1 Premium income (€bn) Net new inflows (€bn) €m underlying underlying underlying +7.3% Q1/Q1 UL: +17.5% Q1/Q1 +2.
Slide 14: Asset management - Amundi
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Asset management - Amundi Assets under management(1) (€bn) Contribution to Crédit Agricole S.A. P&L Q1-18 Q1-17 ∆ Q1/Q1 +28.8% €m underlying underlying underlying 18.1 21.7 - 13.5 1,452 Revenues 644 432 +49.1% 1,426 Retail Market 235 Treasury Operating expen
Slide 15: Retail banking France – LCL
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Retail banking France – LCL Activity indicators (€bn) Contribution to Crédit Agricole S.A. P&L Customer savings Loans outstanding Q1-18 Q1-17 ∆ Q1/Q1 €m underlying underlying underlying +2.7% Revenues 858 904 (5.0%) 184.5 186.7 187.2 185.8 Operating expenses
Slide 16: International retail banking – Italy
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS International retail banking – Italy Activity indicators (€bn) Contribution to Crédit Agricole S.A. P&L Customer savings Loans outstanding Q1-18 Q1-17 ∆ Q1/Q1 €m underlying underlying underlying +20.8% Revenues 471 400 +17.6% 76.1 75.7 3.9 Operating expenses
Slide 17: International retail banking – excl. Italy
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS International retail banking – excl. Italy Activity indicators (€bn) Contribution to Crédit Agricole S.A. P&L Customer savings Loans outstanding Q1-18 Q1-17 ∆ Q1/Q1 €m underlying underlying underlying +4.3%(1) Revenues 207 206 +0.2% +2.7%(1) Operating expens
Slide 18: Specialised financial services
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Specialised financial services CACF – Consumer finance CAL&F – Leasing Contribution to Crédit Agricole S.A. P&L Q1-18 Q1-17 ∆ Q1/Q1 Gross managed loans (€bn)(2) Gross consolidated loans (€bn) €m underlying underlying underlying Revenues 688 685 +0.4% +5.3% +
Slide 19: Large customers
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Large customers Underlying revenues of Large Customers (€m) Contribution to Crédit Agricole S.A. P&L Q1-18 Q1-17 ∆ Q1/Q1 €m (11.5%) underlying underlying underlying Revenues 1,322 1,493 (11.5%) 1,493 1,399 1,322 Operating expenses excl.SRF (782) (813) (3.7%)
Slide 20: Corporate centre
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Corporate centre Change in quarterly underlying(1) net income (€m) Contribution to Crédit Agricole S.A. P&L ∆ Q1/Q1 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 €m Q1-18 Q1-17 (m€) Revenues (112) (166) +54 Operating expenses excl. SRF (190) (216) +2
Slide 21: Business model, strategy and MTP update
1 Q1-18 RESULTS p. 4 2 BUSINESS MODEL, STRATEGY AND MTP UPDATE p. 21 3 SOLVENCY AND CAPITAL PLANNING p. 34 4 CONCLUSION p. 38 5 APPENDIX p. 40 21 l CONFERENCE PRESENTATION – JUNE 2018
Slide 22: A stable, diversified and profitable business model
CRÉDIT AGRICOLE S.A. BUSINESS MODEL A stable, diversified and profitable business model 2017/2016 earnings growth in all business lines Good level of diversification in terms of business lines' contribution to Group net income Group share, with no business line accounting for more than 30% of ne
Slide 23: A stable, diversified and profitable business model: RoNE
CRÉDIT AGRICOLE S.A. BUSINESS MODEL A stable, diversified and profitable business model Underlying RoNE(2) 2017 by business line and 2019 targets in %(2) After tax and AT1 coupons allocated to business lines(2) 2019 MTP target >25% 2019 MTP2016 target Underlying >25% 2017 Underlying 2016 Underlying
Slide 24: Major achievements since launch of MTP: value-creating acquisitions
CRÉDIT AGRICOLE S.A. MAJOR ACHIEVEMENTS SINCE LAUNCH OF MTP Value-creating acquisitions Pioneer investments (closed 3 July 2017) Acquisition by Amundi of 100% of Pioneer Investments(1), Unicredit’s AM subsidiary, for €3,545m Strong synergy potential – €180m before tax – thanks to Amundi’s dive
Slide 25: Zoom on Pioneer transaction
CRÉDIT AGRICOLE GROUP ZOOM ON PIONEER TRANSACTION Integration of Pioneer on 3 July 2017 Amundi: AuM of €1,452bn at end-March 2018, No.1 in Europe(1), in the top 10 asset manager worldwide Leadership strengthened A customer mix A full range of expertise Strong first results in Europe(1) thanks rebala
Slide 26: Zoom on acquisition in Italy
CRÉDIT AGRICOLE GROUP ZOOM ON ACQUISITION IN ITALY Acquisition of 3 regional banks in Italy enabling growth of the franchise and results with time Market shares in Italy post transaction Integration to BPI Italy +1pp Merger of the 3 banks with Cariparma before end-September Market share in marke
Slide 27: Major achievements since launch of MTP: disposal of non-core assets
CRÉDIT AGRICOLE S.A. MAJOR ACHIEVEMENTS SINCE LAUNCH OF MTP Disposal of non-core assets Disposal of interest in Eurazeo (6 June 2017) Disposal of a 15.42% interest in the listed holding company for a total of €790.5m Hedging mechanism against changes in share price for mandatory convertibles i
Slide 28: Progress on the MTP - Synergy initiatives
CRÉDIT AGRICOLE GROUP MTP UPDATE Progress on the MTP - Synergy initiatives, strengthening client positioning Reinforced collaboration between the business lines and the Group networks, in line with their strategic targets Strengthened cooperation between CACF and the Group's retail banks: increa
Slide 29: Progress on the MTP - No. 1 in digital banking in France
CRÉDIT AGRICOLE GROUP MTP UPDATE Progress on the MTP - Crédit Agricole No. 1 in digital banking in France Audience and visits Usage Group apps: usage up significantly, 5.2 m users of our All Group brands: 18m unique visitors per month, apps every month 124m visits(2) MaBanque app (CA): first banking
Slide 30: Progress in MTP - Innovation at the heart of strategy
CRÉDIT AGRICOLE GROUP MTP UPDATE Progress in MTP - Innovation at the heart of the Group’s strategy Create & develop Experiment & learn • Around 30 POCs(1) in progress surrounding artificial by CA intelligence • Launch of a start-up studio, “La Fabrique by CA”, for the creation • Collective experimen
Slide 31: Cross-functional operational efficiency programmes
CRÉDIT AGRICOLE GROUP MTP UPDATE Progress on the MTP – Cross-functional operational efficiency programmes Convergence of IT production within a joint entity for Crédit Agricole Group A top-tier mutual technology hub with a Group Cloud and DevOps automation platform Implementation of the target
Slide 32: Digital: significant achievements across business lines
CRÉDIT AGRICOLE GROUP MTP UPDATE Progress on the MTP - Digital: significant achievements across our business lines • Nationwide rollout of GEOPLAN, a digital tool Launch of that assists farmers with property and casualty • A card, an app and branch services for insurance €2/month Automated supply ch
Slide 33: Progress on the MTP – Update of financial targets
MTP UPDATE Progress on the MTP – Update of financial targets Crédit Agricole Group Crédit Agricole S.A. 2015 2017 2019 Targets 2015 2017 2019 Targets 31,314 +1.5%(*) > +1,5% Underlying revenues CAGR 16,683 +6.1%(*) > +2,5% 62.9% 63.4% < 60% Cost / income ratio 68.6% 62.8% <60% 30 17 < 35 Cost
Slide 34: Solvency and capital planning
1 Q1-18 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 21 3 SOLVENCY AND CAPITAL PLANNING p. 34 4 CONCLUSION p. 38 5 APPENDIX p. 40 34 l CONFERENCE PRESENTATION – JUNE 2018
Slide 35: Fully-loaded CET1 ratio at 11.4%
CRÉDIT AGRICOLE S.A. FINANCIAL SOLIDITY Fully-loaded CET1 ratio at 11.4% pro forma at end-March 2018, above target of 11% Change in fully-loaded CET 1 ratio (bp) Change in RWAs (€bn) 306 301 301 301 300 296 299 296 294 294 293 +72bp 11.7% +27bp -10 +3bp -48bp 11.4% +77bp -16bp -31bp -6bp -10bp -2bp
Slide 36: Capital planning
CRÉDIT AGRICOLE S.A. FINANCIAL SOLIDITY Capital planning Trajectory of CET1 fully-loaded ratio until end of MTP +2.3pp MTP targets: 11.4% ≥ 11% -1.2pp -0.5pp -0.3pp -0.8pp 11% Net income CASA fully-loaded CET1 ratio and dividend impacts: 11.4% at end-March.18 company-collected Mar. 18 Net income Dis
Slide 37: Attractive dividend policy
FINANCIAL SOLIDITY Attractive dividend policy Reminder: dividend 2017 €0.63(1) i.e. a yield of 4.5%(1) based on 13 February 2018 share price From 2017 onwards Dividend payout of 50% of attributable net income(2) Cash only Intention not to lower dividend compared to 2016 level (€0.60 floo
Slide 38: Conclusion
1 Q1-18 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 21 3 SOLVENCY AND CAPITAL PLANNING p. 34 4 CONCLUSION p. 38 5 APPENDIX p. 40 38 l CONFERENCE PRESENTATION – JUNE 2018
Slide 39: Conclusion
CRÉDIT AGRICOLE S.A. CONCLUSION Very good activity, operating costs under control and cost of risk down Integration of Pioneer and the three Italian banks ahead of initial schedule Negative scope effect of the disposal in 2017 of non-core entities (BSF, Eurazeo) Business at high levels and of
Slide 40: Appendix
1 Q1-18 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 21 3 SOLVENCY AND CAPITAL PLANNING p. 34 4 CONCLUSION p. 38 5 APPENDIX p. 40 40 l CONFERENCE PRESENTATION – JUNE 2018
Slide 41: Simplification of the Group structure
CRÉDIT AGRICOLE S.A. APPENDIX Simplification of the Group structure Former Group structure New Group structure Local Banks of Holders Local Banks of Holders Crédit Agricole and of SACAM Crédit Agricole and of Mutualisation other members CCI/CCAs other members CCI/CCAs Mutual shares (with voting righ
Slide 42: Alternative Performance Measures – Specific items Q1-18
CRÉDIT AGRICOLE S.A. APPENDIX Alternative Performance Measures – Specific items Q1-18 Q1-18 Q1-17 Gross Impact on Gross Impact on €m impact* NIGS impact* NIGS Issuer spreads (CC) - - (8) (4) DVA (LC) 5 4 (48) (31) Loan portfolio hedges (LC) 4 3 (24) (15) Home Purchase Savings Plans (FRB) - - - - Hom
Slide 43: Reconciliation between stated and underlying results – Q1-18
CRÉDIT AGRICOLE S.A. APPENDIX Reconciliation between stated and underlying results – Q1-18 Q1-18 Q1-18 Q1-17 Specific Q1-17 ∆ Q1/Q1 ∆ Q1/Q1 Q1-17 Q1-18 Q1-18 ∆ Q1/Q1 €m Specific items stated underlying stated items underlying stated underlying scope adj. scope adj. forex adj. like-for-like Revenues
Slide 44: Data per share
CRÉDIT AGRICOLE S.A. APPENDIX Data per share (€m) Q1-18 Q1-17 Q1-18/Q1-17 Net income Group share - stated 856 845 +1.2% - Interests on AT1, including issuance costs, before tax (131) (141) -6.9% NIGS attributable to ordinary shares - stated [A] 724 704 +2.8% Average number shares in issue, excluding
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Slide 46: Investor relations contacts
CRÉDIT AGRICOLE S.A. INVESTOR RELATIONS CONTACTS: Institutional shareholders + 33 1 43 23 04 31 [email protected] Individual shareholders + 33 800 000 777 [email protected] (toll-free number France only) Cyril Meilland, CFA + 33 1 43 23 53 82 cyril.