Credit Agricole SA · EURONEXT:ACA
Credit Agricole SA — Morgan Stanley 2018 Conference
36 slides from Credit Agricole SA's conference presentation, Jul 12, 2018
Slide 1: Morgan Stanley 2018 Conference
Jérôme Grivet, Deputy General Manager & CFO Morgan Stanley 2018 Conference 1 l MORGAN STANLEY 2018 CONFERENCE
Slide 2: Disclaimer
DISCLAIMER Financial information on Crédit Agricole S.A. and Crédit Agricole Group for the fourth quarter and full year period 2017 comprises this presentation and the attached press release and financial report which are available on the website https://www.credit- NOTE agricole.com/en/finance/fi
Slide 3: Introduction: Major achievements in 2016 and 2017
CRÉDIT AGRICOLE S.A. INTRODUCTION Major achievements in 2016 and 2017 New Medium Term Plan announced in March 2016: “Strategic Ambition 2020” Focus on Group structure simplification, customer project, growth momentum via cross selling and enhanced operating efficiency Completion of the Group s
Slide 4: Agenda
1 FY 2017 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 14 3 SOLVENCY AND CAPITAL PLANNING p. 26 4 CONCLUSION p. 30 5 APPENDIX p. 32 4 l MORGAN STANLEY 2018 CONFERENCE
Slide 5: Strong profit momentum
STRONG PROFIT MOMENTUM Key figures CRÉDIT AGRICOLE GROUP CRÉDIT AGRICOLE S.A. Q4-17 2017 Q4-17 2017 €922m €6,536m Net income Group share - stated €387m €3,649m +37.4% Q4/Q4 +35.5% 2017/2016 +32.9 % Q4/Q4 +3.1% 2017/2016 €1,692m €7,123m Net inc. Group share - underlying(1) €878m €3,925m -7.5% Q4/Q4 +
Slide 6: Crédit Agricole Group results
CRÉDIT AGRICOLE GROUP RESULTS Strong momentum in all business lines in Q4-17 RETAIL BANKING Regional Banks LCL Italy Home loans +8.1% Home loans +7.4% Home loans +9.4% Strong credit activity: slowdown Consumer loans +9.0% Corporate loans +13.4% Corporate loans +13.6% of home lending compensated by
Slide 7: Sustained increase in revenues
CRÉDIT AGRICOLE S.A. RESULTS Sustained increase in revenues Change 2017/2016 in underlying revenues(1), by division +7.2% +4.8% 16,855 (652) 17,506 +520 (11) +75 +202 +480 18,772 (138) 18,634 increase in underlying revenues(1) and at constant scope(2) 2017/2016 2016 stated Specific (1) 2016 Asset Re
Slide 8: Costs well under control
CRÉDIT AGRICOLE S.A. RESULTS Costs well under control Change in underlying(1) costs 2017/2016 by division +3.7% 12,202 11,694 +417 +22 +61 11,785 (242) +1.3% (92) (241) 11,362 (41) (36) (176) increase in underlying costs(1) excl. SRF and at constant scope(3) 2017/2016 2016 Specific SRF 2016 Asset Re
Slide 9: 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 39 41 41 41 CACF 37 -30bp Q4/Q4 35 Assumption 2019: 35bp 30 30 31 31 Italian retail banking
Slide 10: Strong increase in underlying NIGS
CRÉDIT AGRICOLE S.A. RESULTS Strong increase in underlying NIGS Change 2017/2016 in underlying NIGS(1), by division +23.0% +373 3,925 3,541 +78 (276) 3,649 +48 +110 +351 3,190 +125 +23% increase in underlying NIGS(1) 2017/2016 2016 stated Specific 2016 Asset Retail SFS Large Corporate 2017 Specific
Slide 11: Business lines highlights
CRÉDIT AGRICOLE S.A. RESULTS Business lines highlights Revenues 2019 RoNE > Asset gathering 2015-2019 Retail Banking 16% CAGR: +3% NIGS: +7.1%(1) 2017/2016 NIGS: +6,2%(1) 2017/2016 Revenue growth ahead of MTP: +7.6% at constant scope 2017/2016 LCL (NIGS: +9.0%): strong performances (loans outsta
Slide 12: A stable, diversified and profitable business model
CRÉDIT AGRICOLE S.A. RESULTS 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 2017 Un
Slide 13: A stable, diversified and profitable business model
CRÉDIT AGRICOLE S.A. RESULTS 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 NIGS, with no business line accounting for more than 30% of NIGS (excl. Corporate Centr
Slide 14: Agenda
1 FY 2017 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 14 3 SOLVENCY AND CAPITAL PLANNING p. 26 4 CONCLUSION p. 30 5 APPENDIX p. 32 14 l MORGAN STANLEY 2018 CONFERENCE
Slide 15: Major achievements in the past 18 months: acquisitions
CRÉDIT AGRICOLE S.A. MAJOR ACHIEVEMENTS IN THE PAST 18 MONTHS 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 di
Slide 16: Zoom on Pioneer transaction
CRÉDIT AGRICOLE GROUP ZOOM ON PIONEER TRANSACTION Integration of Pioneer on 3 July 2017 Amundi: AuM of €1,426bn, 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 rebalanced reinforced in
Slide 17: 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 market share Market share in at national l
Slide 18: Crédit Agricole S.A. in Italy
CRÉDIT AGRICOLE S.A. ACTIVITY AND RESULTS Crédit Agricole S.A. in Italy Aggregation of underlying results(1) of Crédit Agricole S.A. entities in Italy(2) Q4-17 ∆ Q4/Q4 2017 ∆ 2017/2016 €m underlying underlying underlying underlying Revenues 796 +3.6% 3,111 +3.1% 15% Operating expenses excl. SRF SRF
Slide 19: Major achievements: disposal of non-core assets
CRÉDIT AGRICOLE S.A. MAJOR ACHIEVEMENTS IN THE PAST 18 MONTHS 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
Slide 20: MTP update: synergy initiatives, client positioning
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 21: MTP update: 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 22: MTP update: 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 23: MTP update: cross-functional operational efficiency
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 24: MTP update: digital 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 25: MTP update: 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 26: Agenda
1 FY 2017 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 14 3 SOLVENCY AND CAPITAL PLANNING p. 26 4 CONCLUSION p. 30 5 APPENDIX p. 32 26 l MORGAN STANLEY 2018 CONFERENCE
Slide 27: Financial solidity: CET1 ratio at 11.3% pro forma
CRÉDIT AGRICOLE S.A. FINANCIAL SOLIDITY Fully-loaded CET1 ratio at 11.3% pro forma, above target of 11% Change in fully-loaded CET 1 ratio (bp) Change in RWAs (€bn) +72bp 11.7% 306 +77bp +3bp 11.3% 296 294 301 301 301 300 294 293 296 10.7% -48bp -2bp -5bp -30bp -8bp -10 Eurazeo +13bp Pioneer -60bp
Slide 28: Capital planning
CRÉDIT AGRICOLE S.A. FINANCIAL SOLIDITY Capital planning Trajectory of CET1 fully-loaded ratio until end of MTP +2.5pp MTP targets: 11.3% ≥ 11% -1.3pp -0.7pp -0.3pp -0.5pp 11% Net income CASA fully-loaded CET1 ratio and dividend impacts: 12.0% at end-Sept.17 company-collected Dec. 17 Net income Dist
Slide 29: 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 30: Agenda
1 FY 2017 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 14 3 SOLVENCY AND CAPITAL PLANNING p. 26 4 CONCLUSION p. 30 5 APPENDIX p. 32 30 l MORGAN STANLEY 2018 CONFERENCE
Slide 31: Conclusion: key messages
CRÉDIT AGRICOLE S.A. CONCLUSION Key messages Cross-selling strategy accelerated Profitable and sustainable business model, with growth in Crédit Agricole S.A.’s specialised entities underpinned by the Group retail banks’ distribution capacity Targeted acquisition strategy in Italy aimed at enh
Slide 32: Agenda
1 FY 2017 RESULTS p. 4 2 STRATEGY AND MTP UPDATE p. 14 3 SOLVENCY AND CAPITAL PLANNING p. 26 4 CONCLUSION p. 30 5 APPENDIX p. 32 32 l MORGAN STANLEY 2018 CONFERENCE
Slide 33: 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 SACAM Crédit Agricole and of Crédit Agricole and of Mutualisation other members CCI/CCAs other members CCI/CCAs Mutual shares (with voting righ
Slide 34: Data per share
CRÉDIT AGRICOLE S.A. APPENDIX Data per share (€m) 2017 2016 Q4-17 Q4-16 2017/2016 Q4/Q4 Net income Group share - stated 3,649 3,541 387 291 +3.1% +32.9% €0.26 - Interests on AT1, including issuance costs, before tax (454) (474) (125) (136) -4.1% -7.8% NIGS attributable to ordinary shares - stated [A
Slide 35: Alternative Performance Measures – Specific items Q4-17 and 2017
CRÉDIT AGRICOLE S.A. APPENDIX Alternative Performance Measures – Specific items Q4-17 and 2017 Q4-17 Q4-16 2017 2016 Gross Impact on Gross Impact on Gross Impact on Gross Impact on €m impact NIGS impact NIGS impact NIGS impact NIGS Issuer spreads (CC) (95) (62) 103 66 (216) (131) (139) (84) DVA (LC)
Slide 36: 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.