CREDIT AGRICOLE SA: Historic Q4 and full-year 2022 results, MTP
targets met
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Historic Q4 and full-year 2022 results, MTP targets
met |
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GCA AND CASA STATED AND UNDERLYING DATA 2022 |
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CRÉDIT AGRICOLE S.A. |
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CRÉDIT AGRICOLE GROUP |
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Stated |
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Underlying |
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Stated |
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Underlying |
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Revenues |
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€23,801m+5.5% 12M/12M |
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€23,733m+4.8% 12M/12M |
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€38,162m+3.6% 12M/12M |
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€37,682m+2.6% 12M/12M |
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Costs excl. SRF |
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-€13,932m+3.7% 12M/12M |
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-€13,822m+5.7% 12M/12M |
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-€23,650m+4.6% 12M/12M |
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-€23,476m+5.5% 12M/12M |
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GOI |
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€9,222m+4.4% 12M/12M |
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€9,264m+2.4% 9M/9M |
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€13,709m-0.2% 12M/12M |
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€13,403m-3.0% 12M/12M |
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Cost of risk |
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-€1,746m +10.8% 12M/12M |
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-€1,551m+25.9% 12M/12M |
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-€2,893m+31.9% 12M/12M |
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-€2,698m+45.9% 12M/12M |
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Net income Group share |
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€5,437m-7.0% 12M/12M |
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€5,468m+1.3% 12M/12M |
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€8,144m-10.5% 12M/12M |
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€7,909m-7.1% 12M/12M |
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C/I ratio (excl. SRF) |
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58.5%-0.7 pp 12M/12M |
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58.2%+0.5 pp 12M/12M |
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65.3%+1.0 pp 12M/12M |
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64.0%+2.1 pp 12M/12M |
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STRONG PERFORMANCE
- 1.9 million new
customers in 2022 (net customer capture 382,000) in France, Italy
and Poland
- RB, LCL and CA
Italia loan production up +5.8% in 2022 (of which +0.4% for home
loans and +15.6% for professionals/corporates)
HISTORIC Q4 RESULTS
- Record Q4 net
income for CASA (+€1.5bn, +6.7% Q4/Q4)
- Strong revenue
growth (+4.4% Q4/Q4) driven by all business lines
ALL MTP 2022 PROFITABILITY TARGETS EXCEEDED
THIS YEAR
- Income €5.5
billion, up +1.3% vs a record 2021, despite higher risk costs
- 58.2%
cost/income ratio, positive business-line jaws over the year
despite inflation
- 12.6% RoTE,
above the MTP target
DIVIDEND €1.05 PER SHARE
- 50% pay-out in
cash, plus €0.20/share related to the 2019 dividend
CONTINUATION OF STRATEGIC OPERATIONS IN 2022
- Announcement of
partnerships/acquisitions CACF/Stellantis, CACEIS/RBC, Banco
BPM/CAA
- Presentation of
the MTP “2025 Ambitions” and of Net Zero targets in financing,
insurance and asset management
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SOLID BALANCE SHEET, CET1 ON TARGET DESPITE THE RISE IN
RATES |
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CRÉDIT AGRICOLE S.A. |
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CRÉDIT AGRICOLE GROUP |
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| Phased-in
CET1 |
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11.2% |
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+20 bp
Dec/Sept |
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17.6% |
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+40 bp Dec/Sept |
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+3.3 pp > SREP |
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+8.7 pp > SREP |
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Dividend of €1.05 per share |
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€19.9bn CAG loan loss reserves 83% coverage
ratio |
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Dominique Lefebvre, Chairman of SAS Rue La
Boétie and Chairman of the Crédit Agricole S.A. Board of
Directors “Our up-to-date model, based on universality and
utility, stands out through its capacity to meet the needs of all
our customers, to contribute significantly to the financing of the
real economy, and to support to societal transitions.” |
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Philippe
Brassac,Chief Executive Officer
of Crédit Agricole S.A. " Strong and solid results, in
a context of shocks and adaptation. They confirm the relevance of
the Universal Customer-focused banking model, geared towards
providing comprehensive answers to customers, adapted and faithful
to their needs” |
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This press release comments on the results of
Crédit Agricole S.A. and those of Crédit Agricole Group, which
comprises the Crédit Agricole S.A. entities and the Crédit Agricole
Regional Banks, which own 56.8% of Crédit Agricole S.A. Please see
p.46 onwards of this press release for details of specific items,
which are restated in the various indicators to calculate
underlying income.
Crédit Agricole Group
Group activity
The Group recorded a strong commercial activity
over the quarter across all business lines thanks to the customer
focused banking model. Gross customer capture has been dynamic. In
2022, the Group recorded +1.9 million new customers in retail
banking, and the customer base continued to grow (+380,000
customers) in line with the MTP Ambitions 2025 targets. More
specifically, over the fourth quarter of 2022, the Group recorded
+445,000 new retail banking customers and the customer base
also grew (+40,000 customers). Loan production was also performing
well in 2022, up +5.8% compared with 2021, with €172 billion in new
loans at Regional Banks, LCL and CA Italia1. In France, new loans
granted by the Regional Banks and LCL rose by +6.0% (of which +1.1%
in home loans, +15.2% in corporate and professional loans and -1.8%
in consumer finance). CA Italia loan production was up +2.3%
(down -12.3% in home loans and up sharply +21.7% in professional
and corporate loans excluding SGL and ecobonuses). Furthermore, the
insurance equipment rate2 remained high in the retail banking
networks at the end of December 2022: 42.6% for Regional Banks,
27.1% for LCL, 21.2% for CA Italia, and 16.8% including Creval.
Inflows remained steady in 20223 for all entities, with Amundi
recording positive net inflows of +€7.0 billion between 31 December
2021 and 31 December 2022, CAA posting positive net inflows of
+€3.2 billion, and Wealth Management (Indosuez Wealth Management
and LCL Private Banking) recording positive net inflows of +€6.2
billion. Unit-linked net inflows saw positive insurance performance
at +€6.5 billion in 20224. Property and casualty insurance premium
income increased by +5.5% in 20225 and personal protection
insurance premium income increased by +5.6% over the same period6.
Financing activities were also highly dynamic, notably in
structured finance, and in capital markets and investment banking,
particularly in FICC activities. Finally, in 2022, the Group
continued to develop new offerings, including Propulse by CA, Flex
by LCL, J’Ecorénove mon logement and the energy transition hub.
Each of the Group’s business lines posted very
strong levels of activity (see Infra).
Implementation of the medium-term strategy
The Group’s organic growth drivers were set in
motion in 2022. In 2022, the Group once again complemented this
growth with strategic transactions, including three major strategic
transactions that will generate more than 150 million in additional
net income Group share by 2026.
Firstly, the framework agreements signed between
CACF and Stellantis in the second quarter of 2022 will allow the
group to become one of Europe’s top five leaders in long-term
leasing with more than 1 million vehicles under a long-term lease
by 2026. CA Consumer Finance also intends to develop a pan-European
multi-brand player in automotive financing, leasing and mobility,
based on the expertise of FCA Bank and Leasys Rent, which it wholly
owns, with a target of €10 billion in outstandings by 2026. This
new entity would offer white label-products and would also target
platforms, dealerships and short-term rental companies. The impact
on the results of these operations will be neutral in 2023 and
positive in 2025, while the impact on RWA will be limited.
Secondly, the signing of an MoU for the
acquisition by CACEIS of RBC’s asset servicing activities in
Europe, a transaction that will generate more than €100 million in
additional net income by 2026 and will strengthen CACEIS’s position
as one of Europe’s leaders with €4.8 trillion in assets under
custody and €3.5 trillion in assets under administration Finally,
the last strategic transaction concerns the strengthening of links
between Crédit Agricole SA and Banco BPM, with Crédit Agricole SA
acquiring a stake in Banco BPM in the second quarter, and the
signing of an MoU between Crédit Agricole Assurances and Banco BPM
in order to establish a long-term partnership in non-life insurance
and creditor insurance in Italy. In addition to these three
strategic transactions, there were also other partnerships,
including CALEF’s acquisition of a 30% stake in Watea by Michelin,
and the signing of a commercial partnership for car insurance
between Mobilize Financial Services, a Renault Group subsidiary
specialising in services that facilitate access to automobiles, and
Crédit Agricole Assurances.
Beyond the partnerships and acquisitions
announced this year, Crédit Agricole S.A. once again
demonstrated its strategic flexibility in 2022 with the disposals
of Serbia and La Médicale (with the latter having a EUR +100
million impact on Crédit Agricole SA’s results), and the
disposal of controlling interest in Crédit du Maroc (disposal of a
63.7% stake with a positive impact of +10 percentage points on
Crédit Agricole SA’s fourth quarter CET1). At this stage,
Crédit Agricole SA retains a residual stake of 15% in Crédit
du Maroc, which will be disposed of by June 2024.
Finally, the year 2022 allowed Crédit Agricole
to demonstrate once again that social responsibility and the
Group’s raison d’être, “Working every day in the interest of our
customers and society”, are fully integrated into its model. As
such, the Group is fully committed to all its customers, from the
most financially modest to the most affluent; it contributes to the
development of all the territories,supports its customers through
their their energy transition. Thus, through its entry-level
offers7, its offers for young people8, and its actions to support
vulnerable populations9, the Group demonstrates its commitment to
serving all its customers. Its contribution to the development of
all regions is demonstrated by its position as the fist financier
of the French, by the fact that nearly 80% of the Group’s income is
reinvested in the territoriess each year, as well as by its role as
the first private investor in corporate equity and quasi-equity in
the capital of French companies, by its financing of
310,000 primary residences in France in 202210, and its launch
of the “Livret Engagé Sociétaire” accounts11. Finally, the Group is
fully committed to supporting its customers through their energy
transition12 while decarbonating the economy and equipping all of
society. Thus, strong, clear and immediate public commitments to
accelerate the advent of renewable energy has been taken and two
new business lines have been created CA Transitions and Energies on
the one hand and CA Santé and Territories on the other hand .
Group results
In the fourth
quarter of 2022,
Crédit Agricole Group’s stated
net income Group share came to
€2,040 million, down -13.3% compared to the
fourth quarter of 2021.
Specific items for the fourth
quarter of 2022 had a negative net impact of -€13 million
on net income Group share. They include Crédit
Agricole SA’s specific items for the fourth quarter of 2022
for +€35 million detailed below, as well as the Regional Banks’
specific items for -€48 million detailed below.
Specific items for the fourth
quarter of 2021 had a positive net impact of +€44 million
on net income Group share. They include Crédit
Agricole SA’s specific items for the fourth quarter of 2021
for -€17 million detailed below, as well as the Regional Banks’
specific items for +€60 million detailed below.
Excluding these specific items,
Crédit Agricole Group’s underlying
net income Group share13 amounted to
€2,053 million, a decline of -11.2% compared
to the third quarter of 2021.
Crédit Agricole Group – Stated and underlying results, Q4-2022
and Q4-2021
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€m |
Q4-22stated |
Specific items |
Q4-22underlying |
Q4-21stated |
Specific items |
Q4-21underlying |
∆ Q4/Q4stated |
∆ Q4/Q4underlying |
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Revenues |
9,434 |
(63) |
9,497 |
9,500 |
120 |
9,380 |
(0.7%) |
+1.2% |
| Operating
expenses excl. SRF |
(6,164) |
(84) |
(6,080) |
(6,109) |
(297) |
(5,812) |
+0.9% |
+4.6% |
| SRF |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
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Gross operating income |
3,270 |
(147) |
3,416 |
3,391 |
(177) |
3,568 |
(3.6%) |
(4.2%) |
| Cost of
risk |
(753) |
- |
(753) |
(783) |
(319) |
(464) |
(3.9%) |
+62.2% |
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Equity-accounted entities |
97 |
(8) |
105 |
92 |
- |
92 |
+4.6% |
+13.4% |
| Net income on
other assets |
(13) |
- |
(13) |
10 |
- |
10 |
n.m. |
n.m. |
| Change in
value of goodwill |
- |
- |
- |
119 |
119 |
0 |
(100.0%) |
(100.0%) |
|
Income before
tax |
2,600 |
(155) |
2,755 |
2,829 |
(376) |
3,205 |
(8.1%) |
(14.0%) |
| Tax |
(344) |
176 |
(520) |
(269) |
438 |
(707) |
+27.7% |
(26.5%) |
| Net income
from discont'd or held-for-sale ope. |
(27) |
(14) |
(13) |
4 |
- |
4 |
n.m. |
n.m. |
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Net income |
2,229 |
7 |
2,222 |
2,564 |
61 |
2,503 |
(13.1%) |
(11.2%) |
| Non
controlling interests |
(189) |
(20) |
(169) |
(210) |
(18) |
(192) |
(9.8%) |
(11.8%) |
|
Net income Group
Share |
2,040 |
(13) |
2,053 |
2,354 |
44 |
2,311 |
(13.3%) |
(11.2%) |
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Cost/Income ratio excl. SRF (%) |
65.3% |
|
64.0% |
64.3% |
|
62.0% |
+1.0 pp |
+2.1 pp |
In the fourth quarter of 2022,
underlying revenues amounted to €9,497 million, up
+1.2%, and +0.6% at constant scope14, compared to the fourth
quarter of 2021, thanks to sustained activity across all business
lines, and despite negative market effects on stocks activities.
Underlying operating expenses excluding the Single
Resolution Fund (SRF) rose by 4.6% in the fourth quarter
of 2022 to €6,080 million (+3.9% excluding scope effect), due in
particular to the support of the development of the business lines
and IT expenses, but also to the increase in compensation in an
inflationary context. Overall, the Group’s underlying
cost/income ratio excluding the SRF recorded an increase
of +2.1 percentage points to 64.0% in
fourth quarter of 2022. Underlying gross
operating income was down -4.2% to €3,416 million
compared to the fourth quarter of 2021.
The cost of credit risk rose to
-€753 million (including -€50 million in cost of risk on performing
loans (stage 1 and 2), -€741 million in cost of proven risk (stage
3), notably due to a specific provision, +€38 million in other
risks corresponding mainly to reversals of legal provisions), i.e.
an increase of +62.2% compared to the fourth quarter of 2021. The
provisioning levels were determined by taking into account several
weighted economic scenarios, as in previous quarters, and by
applying adjustments on sensitive portfolios. The weighted economic
scenarios for the fourth quarter take into account the
deterioration of the economic outlook, in particular with
decreasing assumptions for GDP increase. The
cost of credit risk on outstandings15
over a rolling four-quarter period stands at
25 basis points, which is the assumption of the
Medium-Term Plan, despite an
underlying impact of Russia / Ukraine conflict of €691
million. It stands at 27 basis points on a quarterly
annualised basis16.
Underlying pre-tax income stood at
€2,755 million, a year-on-year decrease of -14.0%
from the fourth quarter of 2021. The underlying pre-tax income
included the contribution from equity-accounted entities for
€105 million (up +13.4%) and net income on other assets, which
came to -€13 million in the second quarter. The
underlying tax charge fell
-26.5% over the period. Underlying net income
before non-controlling interests was down -11.2% to
€2,222 million. Non-controlling interests decreased -11.8%.
Lastly, underlying net income Group share was
€2,053 million, -11.2% lower than in the fourth quarter of
2021.
Crédit Agricole Group – Stated and underlying results, 2022 and
2021
|
€m |
2022stated |
Specific items |
2022underlying |
2021stated |
Specific items |
2021underlying |
∆ 2022/2021stated |
∆ 2022/2021underlying |
| |
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Revenues |
38,162 |
480 |
37,682 |
36,822 |
92 |
36,730 |
+3.6% |
+2.6% |
| Operating
expenses excl.SRF |
(23,650) |
(174) |
(23,476) |
(22,602) |
(347) |
(22,255) |
+4.6% |
+5.5% |
| SRF |
(803) |
- |
(803) |
(479) |
185 |
(664) |
+67.6% |
+20.9% |
|
Gross operating income |
13,709 |
306 |
13,403 |
13,741 |
(70) |
13,812 |
(0.2%) |
(3.0%) |
| Cost of
risk |
(2,893) |
(195) |
(2,698) |
(2,193) |
(344) |
(1,849) |
+31.9% |
+45.9% |
|
Equity-accounted entities |
419 |
(8) |
427 |
392 |
5 |
387 |
+7.1% |
+10.5% |
| Net income on
other assets |
28 |
- |
28 |
(27) |
(15) |
(12) |
n.m. |
n.m. |
| Change in
value of goodwill |
- |
- |
- |
497 |
497 |
0 |
(100.0%) |
(100.0%) |
|
Income before
tax |
11,264 |
103 |
11,161 |
12,409 |
73 |
12,337 |
(9.2%) |
(9.5%) |
| Tax |
(2,508) |
59 |
(2,567) |
(2,463) |
616 |
(3,079) |
+1.8% |
(16.6%) |
| Net income
from discont'd or held-for-sale ope. |
116 |
80 |
36 |
6 |
3 |
3 |
x 19.3 |
x 13.2 |
|
Net income |
8,873 |
242 |
8,630 |
9,953 |
692 |
9,261 |
(10.9%) |
(6.8%) |
| Non
controlling interests |
(729) |
(7) |
(722) |
(852) |
(104) |
(748) |
(14.5%) |
(3.6%) |
|
Net income Group
Share |
8,144 |
236 |
7,909 |
9,101 |
589 |
8,512 |
(10.5%) |
(7.1%) |
|
Cost/Income ratio excl.SRF
(%) |
62.0% |
|
62.3% |
61.4% |
|
60.6% |
+0.6 pp |
+1.7 pp |
Over the full year 2022,
stated net income Group share amounted to €8,144 million,
versus €9,101 million for full year 2021, representing a
decrease of -10.5%. As a reminder, the year 2021 was characterised
by a base effect on net income Group share, which included +€473
million for the badwill and off-balance sheet DTA of Creval17.
Excluding this effect, the decline in stated net income Group share
would be limited to -5.6%.
Specific items for 2022 include the specific
items of the Regional Banks for 2022 detailed in the Regional Banks
section, and the specific items of Crédit Agricole S.A. for
2022 detailed in the Crédit Agricole S.A. section.
Excluding these specific items,
underlying net income Group share amounted
to
€7,909 million,
down -7.1% compared to full year 2021.
Underlying revenues were
up +2.6% compared to 2021. Excluding scope
effect18, underlying revenues rose by +1.5%. This increase in
revenues is explained in particular by the dynamic activity of the
business lines, which offset the impact of the market effect on the
stock business lines and the squeeze on net interest margins in a
context of rapidly rising rates. More specifically, for Retail
Banking, revenues were stable (-0.5% vs 2021) on the French market
with dynamic fee and commission income but a lower net interest
margin, the increase in refinancing costs being partially offset by
the progressive repricing of assets; in international retail
banking in Italy, revenues were supported by the increase in rates
on reserves and production and the growth in fee and commission
income received; in international retail banking in Poland and
Egypt, revenues were supported by the context of rising rates. For
Asset Gathering, the evolution of insurance revenues reflects the
increased recognition of the financial margin and the reversal of
technical reserves. At the same time, private banking benefited
from the rise in interest rates and the diversification of the
product mix. Conversely, asset management revenues suffered from
market effects, penalising management fee and commission income and
performance fee and commission income. In Large Customers,
corporate and investment banking revenues benefited from the
strengthening of commercial positions, particularly in syndicated
loans and bond issuance, and revenues from asset servicing were
supported by a strong net interest margin. Specialised Financial
Services were characterised by dynamic leasing revenues and
consumer finance revenues driven by dynamic commercial production
offsetting the contraction in margins.
Underlying operating expenses
excluding SRF grew by +5.5% compared to 2021 – due in particular to
support for the development of the business lines and IT expenses,
as well as to the increase in compensation – and by +4.1% excluding
scope effect. The cost/income ratio excluding SRF for 2022 thus
stood at 62.3%, up +1.7 percentage point compared to 2021. The SRF
totalled €803 million in 2022, up +20.9% compared to 2021.
Note that the refund of an overpayment over financial years
2016–2021 was accounted for under specific items in the first
quarter of 2021 for +€185 million. Underlying gross
operating income totalled €13,403 million, down -3.0%
compared to 2021.
The cost of risk for the year
rose to -€2,698 million (of which -€959 million in cost of risk on
performing loans (stage 1 and 2), -€1,831 million in cost of proven
risk (normalisation of stage 3 cost of risk), and +€93 million in
other risks corresponding mainly to reversals of legal provisions),
i.e. an increase of +45.9% compared to 2021.
As at 31 December 2022, risk indicators confirm
the high quality of Crédit Agricole Group’s
assets and risk coverage level. The diversified loan book
is mainly geared towards home loans (46% of gross outstandings) and
corporates (33% of gross outstandings). Loan loss reserves amounted
to €19.9 billion at the end of December 2022
(€10.5 billion for Regional Banks), 42% of which represented
provisioning for performing loans (48% for Regional Banks). The
loan loss reserves for performing loans have increased at Group
level by +€2.9 billion since fourth quarter 2019. The prudent
management of these loan loss reserves has enabled the
Crédit Agricole Group to have one of the best19 overall
coverage ratios for doubtful loans (82.9% at the end of December
2022) among the largest European banks.
Net income from other assets
amounted to €28 million in 2022 compared to -€12 million
in 2021, which mainly included the deconsolidation of Crédit
Agricole CIB’s Algerian subsidiary.
Underlying pre-tax income before discontinued operations
and non-controlling interests fell by -9.5% to
€11,161 million.
The tax charge was €2,567 million, down -16.6%,
with an underlying effective tax rate of
23.9%, down - 1.9 percentage point
compared to 2021. The underlying net income before
non-controlling interests was therefore down -6.8%.
Non-controlling interests
amounted to -€722 million in 2022, down -3.6% in line with the
decrease in underlying pre-tax income before discontinued
operations and non-controlling interests.
Underlying net income Group share was therefore
down -7.1% to €7,909 million.
Regional Banks
Regional Banks’ activity was
dynamic in 2022. Gross customer capture increased
by +1,183,000 new customers (270,600 new customers in the fourth
quarter) and the customer base grew by +215,800
new customers since the beginning of the year. The share of
customers using digital tools increased to 73.7%20
(+2.5 percentage points compared to end-December 2022) and the
number of online signatures 21 increased by +85% between the fourth
quarter of 2022 and the fourth quarter of 2021.
Loan production was up this
quarter (+2.5% compared to the fourth quarter of 2021), driven
largely by specialised markets22 (+7.3% compared to the fourth
quarter of 2021), and to a lesser extent by home loans (+1.1%
compared to the fourth quarter of 2021). Furthermore, since the
third quarter of 2022, the average customer loan production rate23
has been higher than the average loan outstandings rate. The
production rate24 for housing loans was up 33 bps compared to
the third quarter of 2022. Loan
outstandings reached €631 billion at end
December 2022, up +5.9% over the year, including +10.1% for
corporates.
Total customer assets rose by
+1.8% year on year to €854.9 billion at the end of December
2022. This growth was driven by on-balance sheet deposits, which
reached €576.7 billion at the end of December 2022, up +4.1%
compared to the end of December 2021 (including +11.6% for passbook
accounts and +0.5% for time deposits). Off-balance sheet customer
assets reached €278 billion, down -2.6% year-on-year due to the
decline in stock markets over the year, but up +2.6% in the fourth
quarter.
In the fourth quarter of 2022,
the Regional Banks’ underlying revenues stood at
€3,428 million, down -4.7% compared to the fourth quarter of 2021,
in line with the portfolio revenues being affected by unfavourable
market effects and a slight decline in the interest margin.
Operating expenses excluding SRF increased +5.5%.
Underlying gross operating income fell by -23.6%.
The cost of risk was up compared to the fourth
quarter of 2022, amounting to -€307 million due to a provision of
-€219 million for proven risks (Stage 3) in connection with a
specific file which has fallen into default. As a result, the
contribution of the Regional Banks to the Group’s
underlying
net income Group share came to
€510 million, a -42.1% decline from the fourth quarter
of 2021.
Over the full year 2022,
underlying revenues were slightly down (-1.7%)
compared to 2021 (up +0.6% according to stated data) and up +2.6%
compared to 2019, due to portfolio revenues being unfavourably
impacted by market conditions, despite good momentum on fees and
commissions (+3.1% compared to 2021). The interest margin was down
compared to 2021 (up according to stated data, including the
provision for home purchase savings of €411 million).
Operating expenses excluding SRF rose by +4.3%,
with the SRF amounting to -€156 million (+9.7%), and
underlying gross operating income was down -13.1%.
The underlying cost/income ratio
excluding SRF amounted to 68.1%, up
+3.9 percentage points compared to 2021; by including, in
revenues, the amount of the Crédit Agricole S.A. dividend
received by the Regional Banks in the second quarter of 2022, i.e.
€1,652 million, the cost/income ratio stood at 60.8%. The
underlying cost of risk increased by +87.7% to €1,136 million, due
to an increase in prudent provisioning on performing loans (Stage 1
& 2) for -€689 million and an increase in proven risk in
connection with a specific file which has fallen into default in
the fourth quarter of 2022. Cost of
risk/outstandings over a rolling
four-quarter period remained low at 19 basis points; the
non-performing loan ratio was low at 1.7% and the coverage ratio
stood at 99.0% at the end of December 2022.
The Regional Banks’ contribution to the
Group’s underlying net income Group share stood at
€2,372 million for 2022, down -22.7% compared to 2021 and up
+2.62% compared to 2019. The Regional Banks’ contribution to the
Group’s stated net income Group share amounted to
€2,630 million, down -17.4% compared to 2021 and down -8.7%
compared to 2019.
Specific items in the fourth quarter of
2022 had a negative impact on the Regional Banks’
stated net income Group share of -€48 million
(negative impact of the restatement of CAGIP’s restructuring costs
for -€22 million, and negative impact of the illiteracy donation
for -€26 million). In the fourth quarter of 2021, specific items
had a positive impact of +€60 million on the Regional Banks’ stated
net income Group share (positive impact of the provision for home
purchase savings of +€60 million).
Specific items in the
full year 2022 had a positive impact on the Regional
Banks’ stated net income Group share of +€257
million (positive impact of the provision for home purchase savings
for +€306 million, negative impact of CAGIP’s restructuring costs
for an amount of -€22 million, and negative impact of the
illiteracy donation for -€26 million).
Specific items in the full year
2021 had a positive impact on the Regional Banks’ stated
net income Group share of +€116 million (positive impact
of the provision for home purchase savings for +€85 million,
positive impact of corrections on the contribution to the SRF for
+€55 million).
Crédit Agricole SA
Results
Crédit Agricole S.A.’s Board of Directors,
chaired by Dominique Lefebvre, met on 8 February 2023 to examine
the financial statements for the fourth quarter and full year
2022.
Crédit Agricole S.A. – Stated and underlying results, Q4-2022
and Q4-2021
|
€m |
Q4-22stated |
Specific items |
Q4-22underlying |
Q4-21stated |
Specific items |
Q4-21underlying |
∆ Q4/Q4stated |
∆ Q4/Q4underlying |
| |
|
|
|
|
|
|
|
|
|
Revenues |
5,969 |
(63) |
6,032 |
5,815 |
36 |
5,779 |
+2.7% |
+4.4% |
| Operating
expenses excl.SRF |
(3,561) |
(20) |
(3,541) |
(3,720) |
(297) |
(3,423) |
(4.3%) |
+3.4% |
| SRF |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
| Gross
operating income |
2,408 |
(83) |
2,491 |
2,094 |
(261) |
2,356 |
+15.0% |
+5.7% |
| Cost of
risk |
(443) |
- |
(443) |
(647) |
(319) |
(328) |
(31.5%) |
+35.1% |
|
Equity-accounted entities |
80 |
(8) |
88 |
82 |
- |
82 |
(2.0%) |
+7.9% |
| Net income on
other assets |
(10) |
- |
(10) |
(9) |
- |
(9) |
+12.1% |
+12.1% |
| Change in
value of goodwill |
- |
- |
- |
119 |
119 |
0 |
n.m. |
(100.0%) |
|
Income before
tax |
2,035 |
(91) |
2,126 |
1,640 |
(461) |
2,100 |
+24.1% |
+1.2% |
| Tax |
(224) |
160 |
(384) |
9 |
462 |
(453) |
n.m. |
(15.2%) |
| Net income
from discont'd or held-for-sale ope. |
(27) |
(14) |
(13) |
4 |
- |
4 |
n.m. |
n.m. |
|
Net income |
1,784 |
55 |
1,729 |
1,652 |
1 |
1,651 |
+8.0% |
+4.7% |
| Non
controlling interests |
(228) |
(30) |
(198) |
(224) |
(8) |
(216) |
+1.6% |
(8.3%) |
|
Net income Group
Share |
1,557 |
25 |
1,531 |
1,428 |
(7) |
1,435 |
+9.0% |
+6.7% |
|
Earnings per
share (€) |
0.49 |
0.01 |
0.48 |
0.46 |
(0.00) |
0.46 |
+6.5% |
+4.1% |
|
Cost/Income ratio excl. SRF (%) |
59.7% |
|
58.7% |
64.0% |
|
59.2% |
-4.3 pp |
-0.5 pp |
In the fourth quarter of
2022, Crédit Agricole S.A.’s stated
net income Group share amounted to
€1,557 million, an increase of +9.0% from the
third quarter of 2021.
Specific items for the quarter
had a cumulative impact of +€25 million on net income Group share,
and included recurring accounting items for an impact of
-€45 million on net income Group share. These include the
following items: recurring accounting volatility items in revenues,
such as the DVA (Debt Valuation Adjustment), the issuer spread
portion of the FVA, and secured lending for -€18 million in net
income Group share, and the hedging of the loan book in the Large
Customers segment for -€28 million in net income Group share.
Specific items also include non-recurring items for an impact of
+€70 million on net income Group share. They include the
Affrancamento-Reallineamento tax gain in international retail
banking for an impact of +€114 million on net income Group share,
transformation costs in connection with the agreement between
Crédit Agricole Consumer Finance and Stellantis for -€16 million in
net income Group share, CAGIP transformation costs with an impact
of -€13 million on net income Group share, as well as the IFRS 5
reclassification of Crédit du Maroc as an asset held for sale, with
an impact of -€14 million on net income Group share.
Specific items from the
fourth quarter of 2021 had a cumulative
impact of +€7 million on net income Group share. They
included: recurring volatile accounting items in revenues, such as
the DVA (Debt Valuation Adjustment, i.e. gains and losses
on financial instruments related to changes in the Group’s issuer
spread) amounting to +€1 million in
net income Group share, hedges on the Large
Customers loan book for +€3 million in
net income Group share, and provisions for home
purchase savings plans in the amount of +€22 million in
net income Group share. In addition to these
recurring items, there were items recognised in CA Italia’s results
for Creval: finalisation of the recording of net badwill for
€90 million in net income Group share, recording of
off-balance sheet deferred tax assets for €80 million in net
income Group share, technology infrastructure upgrade and IT
migration costs for Creval, amounting to -€12 million in net
income Group share, and other miscellaneous Creval adjustments for
-€11 million in net income group share. In addition to these
items, there were actions to improve the quality of CA Italia’s
assets, including the impact of the disposal of a gross portfolio
of €1.5 billion and additional provisions on CA Italia’s portfolio
for -€161 million in net income Group share, the launch of a
Next Generation HR plan for CA Italia and the associated job
protection plan for €97 million in net income Group share, the
exceptional contribution by CA Italia to the Italian banks
safeguard plan for -€13 million in net income Group share, and
the “Affrancamento” gains related to exceptional tax provisions in
Italy for the non-accounting revaluation of goodwill and its
amortisation for €45 million in net income Group share for CA
Italia. Also recognised as specific items were the Lyxor
acquisition costs for -€8 million in net income Group share in
asset management, transformation costs related to the Turbo
project, the Caceis transformation and development plan for
-€12 million in net income Group share in Asset servicing, and
finally the “Affrancamento” gains in Specialised financial services
for AGOS for +€66 million in net income Group share.
Excluding specific items,
underlying net income Group share25 stood at
€1,531 million in fourth quarter 2022, a 6.7% rise
over fourth quarter 2021. The fourth quarter of 2022 was therefore
Crédit Agricole S.A.’s best underlying fourth quarter
since its listing.
In fourth quarter 2022, underlying
revenues stood at €6,032 million, up sharply (+4.4%)
compared to fourth quarter 2021, which itself was an excellent
quarter. This growth was driven by all business lines (revenues
from business lines excluding the Corporate Centre division were up
11.0%). Revenue growth for fourth quarter 2022 was consistent with
the steady growth in Crédit Agricole S.A.’s quarterly revenues over
the past five years, thanks to the diversity of the business
lines.
Underlying operating expenses excluding
SRF totalled €3,541 million in fourth quarter 2022, an
increase of €118 million, or +3.4% (and +3.5% for the expenses
of the business lines, excluding Corporate Centre). Excluding scope
effect (integration of Lyxor in 2021), this increase is brought
down to +2.2% compared to fourth quarter 2021 (i.e.
+€77 million), and to +2.2% (i.e. +€71 million) as well for
the expenses of the business lines, excluding Corporate Centre.26
Jaws were positive by +0.9 percentage point.
The cost/income ratio excluding
SRF thus stood at 58.7% in fourth quarter 2022, an
improvement of - 0.5 percentage point compared to fourth
quarter 2021.
Gross underlying operating
income in fourth quarter 2022 totalled €2,491 million, a
rise of 5.7%. Excluding scope effect (integration of Lyxor in
2021), this was a +5.0% increase compared to fourth quarter 2021
and a +20.3% increase for the business lines, excluding Corporate
Centre.
As at 31 December 2022, risk indicators confirm
the high quality of Crédit Agricole S.A.’s assets
and risk coverage level. The diversified loan book is
mainly geared towards home loans (27% of gross outstandings) and
corporates (46% of Crédit Agricole S.A. gross outstandings). The
non performing loans ratio remained low at 2.7%. The coverage
ratio,27 high at 70.0%, fell by -3.2 percentage points in the
quarter, due to a specific default during the quarter, with a
limited adjustment made to the cost of risk in light of loan
provisioning when such loans were recognised under performing
loans. Loan loss reserves amounted to €9.3 billion
for Crédit Agricole S.A., relatively unchanged from end
September 2022. Of those loan loss reserves, 35% were for
performing loan provisioning. Loan loss reserves for performing
loans were up +€1.3 billion compared with fourth quarter
2019.
The cost of risk shows a net
provisioning of -€443 million (+35.1%/-€115 million
compared to fourth quarter 2021 when it stood at
-€328 million). The expense of -€443 million in fourth
quarter 2022 consists of a provision reversal against performing
loans (Stages 1&2) for +€53 million (versus an allocation
of -€20 million in fourth quarter 2021), provisioning for
proven risks (Stage 3) for -€521 million (versus
-€277 million in fourth quarter 2021, an increase related
primarily to a specific default), and -€24 million in other items,
essentially corresponding to reversals of legal provisions in
capital markets and investment banking. In fourth quarter 2022, the
cost of risk/outstandings over a rolling four-quarter period28 was
32 basis points, and 36 basis points on an
annualised quarterly basis.29
The underlying contribution of the
equity-accounted entities stood at
€88 million in fourth quarter 2022, up +7.9% from fourth
quarter 2021. Net income on other assets stood at
-€10 million in fourth quarter 2022, relatively unchanged
from fourth quarter 2021 when it was -€9 million.
Underlying
income30 before tax,
discontinued operations and non-controlling interests was up +1.2%
to €2,126 million. The underlying effective tax
rate stood at 18.8% (-3.6 percentage points compared
to fourth quarter 2021), while the underlying tax charge fell
by -15.2% to -€384 million. Net income on discontinued
operations came in at -€13 million, versus +€4 million in
fourth quarter 2021. Underlying net income before
non-controlling interests was therefore up +4.7%.
Non-controlling interests amounted to
-€198 million in fourth quarter 2022, down -8.3%.
Underlying
net income Group share was up +6.7%
compared to fourth quarter 2021 at €1,531 million.
Underlying earnings per share
in fourth quarter 2022 were €0.48, up +4.1%
compared to fourth quarter 2021.
Crédit Agricole S.A. – Stated and underlying results, 2022 and
2021
|
€m |
2022stated |
Specific items |
2022underlying |
2021stated |
Specific items |
2021underlying |
∆ 2022/2021stated |
∆ 2022/2021underlying |
| |
|
|
|
|
|
|
|
|
|
Revenues |
23,801 |
68 |
23,733 |
22,657 |
7 |
22,651 |
+5.0% |
+4.8% |
| Operating
expenses excl.SRF |
(13,932) |
(110) |
(13,822) |
(13,429) |
(347) |
(13,082) |
+3.7% |
+5.7% |
| SRF |
(647) |
- |
(647) |
(392) |
130 |
(522) |
+65.2% |
+24.0% |
| Gross
operating income |
9,222 |
(42) |
9,264 |
8,836 |
(210) |
9,047 |
+4.4% |
+2.4% |
| Cost of
risk |
(1,746) |
(195) |
(1,551) |
(1,576) |
(344) |
(1,232) |
+10.8% |
+25.9% |
|
Equity-accounted entities |
371 |
(8) |
379 |
373 |
5 |
368 |
(0.6%) |
+3.0% |
| Net income on
other assets |
15 |
- |
15 |
(51) |
(15) |
(36) |
n.m. |
n.m. |
| Change in
value of goodwill |
- |
- |
- |
497 |
497 |
0 |
(100.0%) |
(100.0%) |
|
Income before
tax |
7,862 |
(245) |
8,107 |
8,080 |
(67) |
8,147 |
(2.7%) |
(0.5%) |
| Tax |
(1,662) |
150 |
(1,812) |
(1,236) |
640 |
(1,876) |
+34.5% |
(3.4%) |
| Net income
from discont'd or held-for-sale ope. |
116 |
80 |
36 |
5 |
3 |
2 |
n.m. |
n.m. |
|
Net income |
6,316 |
(15) |
6,331 |
6,849 |
577 |
6,273 |
(7.8%) |
+0.9% |
| Non
controlling interests |
(880) |
(17) |
(863) |
(1,005) |
(130) |
(876) |
(12.5%) |
(1.5%) |
|
Net income Group
Share |
5,437 |
(32) |
5,468 |
5,844 |
447 |
5,397 |
(7.0%) |
+1.3% |
|
Earnings per
share (€) |
1.68 |
(0.01) |
1.69 |
1.84 |
0.15 |
1.69 |
(8.5%) |
+0.3% |
|
Cost/Income ratio excl.SRF
(%) |
58.5% |
|
58.2% |
59.3% |
|
57.8% |
-0.7 pp |
+0.5 pp |
Over the full year 2022,
stated net income Group share amounted to €5,437 million,
versus €5,844 million for full year 2021, a decrease of
-7.0%.
Specific items in full
year 2022 had a negative impact of
-€32 million on stated net income Group
share. In addition to the fourth quarter items already mentioned
above, items for the first nine months of 2022 had a negative
impact of -€57 million on stated net income Group share and
included recurring volatile accounting items, i.e. the DVA, FVA and
secured lending for +€4 million, and coverage of Large
Customers loan books for +€43 million. In addition the
following non recurrent specific elements were recorded the
provision for equity risk in Ukraine for -€195 million, the
gain on the disposal of La Médicale for +€101 million, changes in
the provision for home purchase savings plans for +€63 million,
Lyxor and Creval integrations costs for -€46 million, the
exceptional provision on moratoria in Poland for -€17 million, or
the reclassification of Crédit du Maroc to assets held for sale for
-€10 million.
Specific items for 2021 had a
positive impact of +€447 million on stated net income Group share
due to recurring volatile accounting items, specifically the DVA
for +€4 million, hedges of the Large Customers loan book for
- €12 million, and changes in the provision for home
purchase savings plans for +€15 million. Added to this were
the following items: the excess SRF contributions paid for
financial years 2016 to 2020 for +€130 million; Creval badwill
for +€376 million; the impact of the disposal of the wealth
management businesses in Miami and Brazil for +€2 million
within the Wealth Management sub-division; the reclassification of
CA Serbia as assets held for sale (IFRS 5) for -€4 million;
Credito Valtellinese acquisition and integration costs for -€24
million; other Creval adjustments for -€11 million; costs of the CA
Italia Next Generation HR Plan (voluntary redundancy plan) for
- €97 million; costs of integration of Kas Bank and S3 by
CACEIS for -€2 million; Lyxor acquisition costs for -€8
million; transformation costs related to the LCL New Generation
Network project at LCL for -€9 million, and to the Turbo
project and the CACEIS transformation and development plan for
-€23 million; the exceptional contribution to the Italian
banks’ safeguard plan for -€13 million; the sale of receivables and
additional provisioning for CA Italia’s loan book for -€161
million; additional provisioning for Creval performing loan
outstandings for -€19 million; the Affrancamento gains related to
exceptional tax provisions in Italy for the non-accounting
revaluation of goodwill and its amortisation amounting to
+€222 million in net income Group share for the IRB
(+€73 million), AG (+€78 million) and SFS
(+€71 million) divisions, and lastly, the Creval off-balance
sheet DTA for +€80 million.
Excluding specific items,
underlying net income Group share came
in at €5,468 million, up +1.3% from 2021.
Underlying earnings per share were
€1.69, stable compared to the full year 2021.
Underlying
RoTE31, which is calculated on
the basis of an annualised underlying net income Group share32 and
IFRIC charges linearised over the year, net of
annualised Additional Tier 1 coupons (return on equity
Group share excluding intangibles) and restated for certain
volatile items recognised in equity (including unrealised gains
and/or losses), reached 12.5% for the first nine months of
2022, -0.6 percentage point from the first nine months of
2021. In 2022, the underlying RoTE31 of Crédit Agricole S.A. is
more than 2.5 percentage points greater than that of a sample of
ten European banks33.
Underlying revenues rose by
+4.8% year-on-year, with revenue growth in all
divisions (increase of +6.5% for the business lines, excluding
Corporate Centre), despite unfavourable market effects impacting
asset activities, more specifically the Asset Gathering division.
Excluding Corporate Centre, and excluding scope effect, business
line revenues were also up by +4.6% in 2022. The increase in
revenues was due to strong business momentum across all business
lines. As regards to the Asset Gathering division, the increase in
insurance revenues was due to the increased recognition of the
financial margin and the reversal of technical reserves. At the
same time, private banking benefited from higher interest rates and
a diversified product mix. By contrast, asset management revenues
were adversely impacted by market effects, which penalised
management and performance fees, even though revenues recovered in
the fourth quarter to show an increase of +4.4% compared to third
quarter 2022. In Corporate and Investment Banking, revenues
benefited from the boost in the division’s commercial positions,
particularly in syndicated loans and bond issues. Asset servicing
revenues were sustained by the net interest margin which offset
market effects on loans. In the Specialised Financial Services
division, consumer finance revenues were sustained by brisk
business production which offset the contraction in margins, while
leasing and factoring revenues were driven by the high level of
factored revenues. In Retail Banking, revenues in France benefited
from strong momentum in fee and commission income. The net interest
margin held steady, as gradual asset repricing offset higher
refinancing costs. In International Retail Banking in Italy,
revenues were supported by the increase in interest rates and
higher fee and commission income. In IRB outside Italy, revenues
were driven by the net interest margin as interest rates rose,
particularly in Poland and Egypt. In the Corporate Centre division,
revenues decreased due to the effect of inflation on ALM, to the
elimination of intragroup securities purchased by Predica and
Amundi, and to the end of the special interest period on TLTRO.
Underlying operating expenses
excluding SRF were up +5.7% compared to 2021. Excluding scope
effect,34 the business lines’ operating expenses (i.e. excluding
Corporate Centre) were up +3.0% (or +€377 million). This increase,
which enabled to support the business lines’ development, was
related to a foreign exchange impact of +€110 million; to an
increase in IT costs and investment of around +€190 million; and to
an increase in payroll of around +€130 million, which included most
notably a +€28 million value sharing bonus. At constant scope, jaws
were positive in 2022 by +1.6 percentage points, the increase in
the business lines’ revenues having exceeded the increase in
expenses. Corporate Centre expenses were up +€76 million,
reflecting the volatility of intra-group transactions with the
Regional Banks in first quarter 2022.
The underlying cost/income ratio
excluding SRF in 2022 reached 58.2%. The cost/income ratio
was therefore lower than the ceiling set by the Medium Term Plan of
60% per year. Since 2017, the cost/income ratio35 of Crédit
Agricole S.A. has remained more than 6 percentage points below than
that of a sample of ten European banks36.
The underlying SRF for 2022 totalled
€647 million, up +24.0% compared to 2021.37 Underlying
gross operating income thus totalled €9,264
million, a rise of +2.4%.
Lastly, the underlying cost of
risk came in at -€1,551 million, rising during the period
by +25.9%/-€320 million. This compares to -€1,232 million
for full year 2021. The increase in 2022 was due to the €113
million increase in provisioning for performing loans (€155 million
in 2021 vs €268 million in 2022), largely related to provisioning
following the outbreak of the Ukraine/Russia war in first quarter
202238 (provisioning of €419 million for performing loans in 2022,
plus €270 million for defaults in 2022). It also included the €374
million increase in provisioning for proven risk, which returned to
normal after a year of very low proven risk costs. That
provisioning rose from €993 million in 2021 to €1,367 million
in 2022 (quarterly average for 2022 comparable to that of 2019).
Proven risk in 2022 include an impact of war in Ukraine since first
quarter and impact of a specific file in the fourth quarter. The
increase was offset by reversals against other risks totalling €168
million and corresponding to reversals of provisions in 2022 for
legal risks in corporate and investment banking vs depreciations in
2021 especially in Italy.
The contribution from equity-accounted
entities was up +3.0% to €379 million,
the main contributors being Specialised Financial Services
partnerships.
Net income on other assets
stood at +€15 million in 2022 compared to -€36 million in 2021. The
2021 contribution mainly came from the deconsolidation of
Crédit Agricole CIB’s Algerian subsidiary.
Underlying income before tax,
discontinued operations and non-controlling interests therefore
fell slightly by -0.5% to €8,107 million.
The tax charge was €1,812 million, down -3.4%,
with an underlying effective tax rate of
23.4%, which was - 0.7 percentage point
lower than in 2021. Underlying net income before
non-controlling interests was therefore up by
+0.9%.
Non-controlling interests
amounted to -€863 million in 2022, a drop of -1.5% in line with the
decline in underlying income before tax, discontinued operations
and non-controlling interests. Underlying
net income Group share increased by
+1.3% to €5,468 million.
Analysis of the activity and the results of Crédit
Agricole S.A.’s divisions and business lines
Activity of the Asset Gathering division
In the fourth quarter of 2022, Asset Gathering
(AG) activity was strong in the market environment that remains
difficult. Assets under management stood at €2,415 billion,
slightly up by +0.5% compared to the end of September 2022. The
quarter was highlighted by strong positive net inflows of +€15.3
billion, of which +€15 billion in Asset Management and +€0.3
billion in Wealth Management, as well as a scope effect of -€0.9
billion linked to the disposal of Brazil in Wealth Management and a
negative market and foreign exchange impact of - €2.1
billion.
At the end of December 2022, the €2,415 billion
in assets under management were down by -6.4% year on year. Net
inflows were positive in 2022 at +€13.2 billion, driven by a good
level of inflows in treasury products and medium and long-term
assets (MLT), after a record level of net inflows at +€71 billion
in 2021. Over the full year 2022, market movements had a very
unfavourable impact on the evolution of assets under management
(market and foreign exchange effects stood at -€182 billion over
the period, out of which -€167 billion for Asset Management).
Excluding double counting, assets under management stood at
€2,138 billion at 31 December 2022, down -5.2% compared to 31
December 2021.
Insurance activity (Crédit Agricole
Assurance) remained dynamic in the fourth quarter of 2022
and the business line continued its growth and diversification both
in France and internationally. At the end of December 2022, total
premium income reached €35.3 billion39, down -3.1%39 compared to
2021.
The fourth quarter of 2022 was highlighted by
several important events for Crédit Agricole Assurance (CAA):
- The signing of a master agreement
between Banco BPM and CAA to establish a long-term distribution
partnership for non-life and creditor insurance in Italy;
- The launch of the Crédit Agricole
Assurance Retraite complementary professional retirement fund;
- The signing of a
commercial partnership for car insurance with Mobilize Financial
Services, Renault Group’s non-life insurance subsidiary.
Savings / Retirement activity
was impacted by the economic and financial environment, with
premium income reaching €25.4 billion39, down -6.6% year-on-year39.
Gross inflows amounted to €6.5 billion this quarter, with a record
unit-linked share of 44.3% (+6.6 percentage points compared to the
third quarter of 2022 and +2.3 percentage points compared to
the fourth quarter of 2021). Net inflows were zero this quarter,
with the decline in net inflows in euro-denominated contracts
(-€1.7 billion) fully offset by positive unit-linked inflows
(+€1.7 billion).
Outstandings (savings,
retirement and death and disability) remained stable over one year
(+0,5%) at €321 billion, with a share in euro outstandings up +1.2%
compared to the end of December 2021. Unit-linked contracts
accounted for 25.6% of assets under management, up +0.8 percentage
point compared to September 2022, but down -1.2 percentage points
over one year in connection with the decline in equity markets.
The policyholders’ deferred profit
sharing rate on Predica’s and Crédit Agricole Assurance
Retraite’s euro-denominated policies stood at 2.32% at the end of
2022, up +106 percentage points compared to the end of 2021.
Finally, the Policy Participation
Reserve (PPE40) amounted to €12 billion at 31 December
2022, representing 5.7% of total euro outstandings.
Property and casualty insurance
activity was dynamic, with a premium income of €5.2 billion39 at
the end of December 2022, up +8.3%39 compared to the end of 2021
and +9.7%39 compared to the fourth quarter 2021. At the end of
December 2022, the portfolio of property and casualty policies
totalled nearly 15.3 million41, a +3.5% increase over one year at
constant scope39. The equipment of individual customers in the
banking networks of Crédit Agricole Group was stable
compared to the end of December 2021 for the Regional Banks (42.6%,
- 0.1 percentage point) and up for LCL (27.1%, +0.5
percentage point), and CA Italia (21.2%, +2.2 percentage points;
16.8% including the Créval customer base). In addition to
traditional activities (home, legal protection, personal accident,
car), the growth of property and casualty insurance activity in the
fourth quarter 2022 was driven by a new car insurance offer in
Italy designed to protect customers in all forms of mobility as
well as by a home insurance offer at a unique rate of €6 per month
for young tenants launched in France in December 2022. The combined
ratio stood at 98.5%, a deterioration of +2.1 percentage points
over the year, marked by several major weather events in
France.
In death & disability/creditor/group
insurance, premium income in 2022 stood at €4.7 billion42,
up +6.4% compared to 202142, with creditor insurance activity still
supported by a favourable real estate market (+8%) and good
performance in consumer finance (+6%). Over the quarter, production
was dynamic, with premium income up by 5.5% at constant
scope42.
Asset Management
(Amundi) reported a
resilient fourth quarter, with positive inflows, particularly in
treasury products excluding JVs and medium and MLT assets, in
markets that remain difficult.
Assets under management reached
€1,904 billion at the end of December 2022 (as a reminder, Lyxor
outstandings were included for the first time as of 31 December
2021 for €148 billion), up slightly by +0.5% compared to 30
September 2022. Over the year, assets under management were down by
-7.7%, with positive inflows in MLT assets only partially
offsetting the strongly unfavourable market and foreign exchange
effets over the year (-€167 billion).
Retail recorded a very good
level of activity in partner networks in France and internationally
in the fourth quarter of 2022 (+€2.6 billion in MLT assets),
particularly in structured products and bonds, which showed a good
level of inflows since the third quarter of 2022. Over the year,
partner networks also showed a good activity, mainly driven by
third-party distributors with positive inflows in MLT assets
excluding JVs (+€6.5 billion).
Institutional investor inflows
were very positive in the fourth quarter of 2022 (+€20.2 billion),
driven by treasury products (+€17.2 billion) and by MLT assets
excluding CA & SG insurers (+€8.3 billion). Over 2022, a very
positive performance of MLT assets excluding JVs only partially
offsets the outflow in treasury products.
Asian JV activity was positive
in 2022 (+€14 billion), driven by a very strong inflows from the
Indian JV, which maintained its leading position in the local
market. Over the quarter, JV activity recorded an outflow of
- €6.2 billion, mainly due to the continued withdrawal
of institutional investors in China in an adverse economic
environment.
Amundi
Technology continued its development, primarily by
increasing the number of its customers (+8 new customers in
2022).
In wealth
management43, total
assets under management (CA Indosuez Wealth Management and LCL
Private Banking) amounted to €190 billion at the end of December
2022 (including €130 billion for Indosuez Wealth Management), and
were stable compared to the end of September 2022. For Indosuez
Wealth Management, the quarter was marked by a very high level of
net inflows at +€0.9 billion, and by a scope effect of -€0.9
billion linked to the disposal of Brazil. Over 2022, outstandings
were down -2.4%, with very high inflows of +€6.2 billion (including
a record level of +€4 billion for Indosuez Wealth Management),
only partially offsetting the very strong negative market and
foreign exchange impact (-€10 billion over 2022).
Results of the Asset Gathering division
Since 31 December 2021, Asset
Gathering (GA) has experienced several scope effects: the
sale of La Médicale to Generali in July 2022 on behalf of Crédit
Agricole Assurance and the integration of Lyxor on behalf of Amundi
from 1 January 2022.
Thus, in the fourth quarter of 2022, at current
scope, AG generated the underlying revenues of
€1,937 million, up +20.5% compared to the fourth quarter of 2021.
In addition to the scope effect related to the integration of
Lyxor, the increase is explained by a very good level of revenues
in insurance and wealth management activities. Expenses increased
by +11.0% at current scope. Thus, the underlying cost/income ratio
excluding SRF stood at 41.1%, down -3.5 percentage points
compared to the fourth quarter of 2021. Gross operating income
stood at €1,142 million, up +28.1% compared to the fourth quarter
of 2021. Tax was up +85.9% due to the 2021 base effect on the scope
of the insurance business lines44. The underlying net
income Group share of AG stood at €705
million, up +15.6% compared to the fourth quarter of 2021.
The decline in asset management income
(-10.7%) was more
than offset by the increase in insurance (+31.1%) and wealth
management (+9.3%) income.
Over 2022, at current scope, in addition to the
scope effect related to the integration of Lyxor, AG’s dynamic
activity allowed it to achieve the revenue growth
of +5.5% over one year to €6,885 million. Costs excluding SRF were
up +9.2%, in connection with the integration of Lyxor, but also
with investments in IT projects. Gross operating
income and pre-tax income increased by
+2.3%. Tax increased by +10.4%, mainly due to a 2021 base effect44.
The underlying cost/income ratio stood at 47.4%,
up +1.6 percentage points compared to 2021. AG thus posted an
underlying net income Group share, of €2,415
million, up +2.8% compared to 2021. The increase in insurance
activities (+11.8%) and wealth management (+9.5%) income offset the
decline in asset management (-12.9%) mainly related to the
unfavourable base effect from the exceptional level of performance
fees in 2021.
Over 2022, Asset Gathering division contributed
by 39% to the underlying net income Group share of the
Crédit Agricole S.A. core businesses (excluding the
Corporate Centre division) and by 29% to underlying revenues
excluding the Corporate Centre division.
As at 31 December 2022, equity allocated to the
division amounted to €12.4 billion, including
€10.7 billion for Insurance, €1.2 billion for Asset
management, and €0.4 billion for Wealth management. The
division’s risk weighted assets amounted to €36.7 billion,
including €19.5 billion for Insurance, €12.4 billion for
Asset management and €4.7 billion for Wealth management.
The division’s underlying
RoNE (return on normalised equity) stood at 22.1%
for full year 2022, versus 24.4% for full year 2021.
Insurance results
In the fourth quarter of 2022,
underlying insurance revenues reached €910
million, up +51.1% (+43.6% at constant scope45) compared to the
fourth quarter of 2021, mainly due to the reversal of technical
reserves (compared to a provision in the fourth quarter of 2021)
that more than offset the lower recognition of the financial
margin. Underlying costs increased by +26.7% (stable at constant
scope45), mainly due to IT and employee expenses.
Underlying gross operating income stood at
€741 million, a sharp increase of +58.0% compared to the
fourth quarter of 2021. The underlying cost/income ratio stood at
18.6%, down -3.6 percentage points compared to the same
period in 2021. The tax charge was -€238 million, up sharply from
-€79 million in the fourth quarter of 2021, due in particular to a
very low tax rate in the fourth quarter of 202144. As a result, the
underlying net income Group share was €483
million, up +31.1% compared to the fourth quarter of 2021.
Over 2022, underlying revenues
reached €2,900 million, up +13.7% (+14.7% at constant
scope46compared to 2021). Indeed, the increase in the recognition
of the financial margin, the reversal of technical reserves, as
well as the positive impact on 2022 revenues of the total unwinding
of the Switch guarantee made it possible to offset a negative
market effects and increased claims. Expenses
increased +8.9% (+9.8% at constant scope46) driven primarily by an
increase in taxes related to growth in premium income adversely
affecting the C3S47, as well as to the costs associated with
business development. The cost/income ratio therefore stood at
27.1%, down -1.2 percentage points compared to 2021.
Underlying gross operating income increased by
+15.6% compared to 2021, amounting to €2,114 million. The
tax charge for 2022 increased by +40.1% to -€483
million, mainly due to the increase in the effective tax rate
compared to 202148. Net income from discounted or
held-for-sale operations stood at €17 million, due to the
finalisation of the disposal of La Médicale in the third quarter of
2022. Lastly, underlying net income Group share
reached €1,572 million, an increase of +11.8% compared to 2021
(at current and constant scope). Including the +€101 million in
gains from the disposal of La Médicale, the stated net income Group
share amounted to €1,673 million.
Concerning the shift of the insurance activities
to the IFRS 17 accounting standards from the 1st of January 2023,
the impact on the results of Crédit Agricole Assurance is expected
to be limited. The decline in the cost/income ratios announced in
the 2025 Medium Term Plan, i.e. lower than 15% for
Crédit Agricole Assurance and lower than 59% for
Crédit Agricole S.A. is confirmed. Finally, the recognition of
the “internal margins” effect at the time of the consolidation of
the insurance activities at the level of Crédit Agricole will be
accounted through the Corporate Centre division, which should
further contribute to a larger reduction of the cost/income ratio
of Crédit Agricole SA.
Insurance contributed 25% to the underlying net
income Group share of the Crédit Agricole S.A. core
businesses (excluding Corporate Centre division) over the year 2022
and 11% to underlying revenues.
Crédit Agricole Assurances also demonstrated its
solidity and resilience with a Solvency 2 regulatory prudential
ratio still high at 204% at 31 December 2022.
Asset management results
In fourth quarter 2022, underlying
revenues reached €770 million, down -0.9% from fourth
quarter 2021 (-7.7% at constant scope49), but definitely up from
third quarter 2022 (+4.4%). Net management fees remained stable
from fourth quarter 2021 (-6.6% at constant scope49, due to the
market effect on customer assets). Performance fees were down from
the exceptional level recorded in 2021, but posted a very solid
level over the last quarter of 2022. Underlying operating
expenses stood at €423 million, up +7.1% (-3.0% at
constant scope49). Thus, the underlying cost/income ratio
excluding SRF was 55.0%50. Underlying gross
operating income decreased by -9.2%. The contribution from
equity-accounted entities, comprising the contribution from the
Amundi joint ventures in Asia, stood at €24 million, up +12.5%, and
the underlying tax charge amounted to -€87 million, a decrease
of -5.5%. Lastly, underlying net income Group
share decreased by -10.7% to €187 million.
Over the year 2022, underlying
revenues totalled €3,056 million, down -2.6% from
financial year 2021 (-8.8% at constant scope49), due to the
unfavourable low effect related to the exceptional level of
performance fees in 2021. Excluding this effect, the underlying
revenues were up, compared to 2021. Net management
fees were up from 2021 by +7.6% and stable at constant
scope49, at nearly €3 billion. The level of
performance fees returned to normal at €171 million
compared with the exceptional level of 2021 (€440 million including
Lyxor in 2021). Underlying operating expenses excluding
SRF rose by +9.2%, but were stable at constant scope49
thanks in particular to the first synergies generated with Lyxor.
The underlying cost/income ratio excluding SRF was
55.8%, up +6.0 percentage points (+4.6 percentage points at
constant scope) compared to the full year in 2021 (which benefited
from the very high performance fees). Thus, gross operating income
fell by -14.3%. The revenues of the equity-accounted entities was
€88 million, an increase of +4.6%. All in all, net income
Group share stood at €730 million, a decrease of
-12.9%.
Asset management contributed 12% to the
underlying net income Group share of the
Crédit Agricole S.A. business lines (excluding
Corporate Centre division) over 2022 and 13% to their
underlying revenues.
At 31 December 2021, equity allocated to Asset
management was €1.2 billion and risk-weighted assets totalled
€12.4 billion.
Wealth management
results51
Underlying revenues from wealth
management totalled €258 million in fourth quarter 2022, an
increase of +12.5% over fourth quarter 2021 (+9.8% at constant
foreign exchange rates), supported by the growth in deposits in a
context of higher rate, thus limiting the negative market effects
on revenues. Underlying costs excluding SRF
reached €203 million, with a contained increase of +8.3% (+4.9% at
constant foreign exchange rates) primarily due to the adjustment in
variable compensation based on the results for the year. Thus,
jaws were very positive this quarter at +4.3
percentage points (+4.9 percentage points at constant foreign
exchange rates) and the underlying cost/income
ratio decreased by -3.1 percentage points to 78.9% in
fourth quarter 2022. Underlying gross operating income, excluding
SRF, rose by +31.9% to €54 million.
Underlying net income Group share reached
€35 million, the highest historical level in ten years, up
+9.3% compared with fourth quarter 2021.
Over the year 2022, the underlying
revenues of the wealth management business line totalled
€929 million, a +10.5% increase over 2021 (+7.1% at constant
foreign exchange rates), driven by the strong commercial momentum
and the increase in the interest margin that offset the
unfavourable market effects on stocks. Costs excluding
SRF were up +9.5% (+5.5% excluding the foreign exchange
impact) at €771 million, primarily related to IT and digital
investments and also to variable compensation. Jaws over 2022 were
positive at +1.0 percentage point (+1.5 percentage point at
constant foreign exchange rates). Underlying gross
operating income was up +16.1% at €155 million.
Finally, net income Group share reached €113
million, an increase of +9.5% over the year in 2022, the highest
historical level in ten years.
Asset management contributed 2% of the
underlying net income Group share of
Crédit Agricole S.A.’s business lines (excluding
Corporate Centre division) over 2022 and 4% to their
underlying revenues.
At 31 December 2021, equity allocated to Wealth
management was €0.4 billion and risk-weighted assets totalled
€4.7 billion.
Activity of the Large Customers division
Corporate and Investment Banking
(CIB) as a whole posted a record performance for the
fourth quarter and for the year 2022.
In the fourth quarter,
underlying revenues were up to
€1,436 million, or +14.8% compared to fourth quarter 2021 (+12.4%
excluding the foreign exchange impact). This growth was driven by
the strong performance of financing activities at
€824 million, i.e. +9.9% compared to fourth quarter 2021 (+5.3% at
constant foreign exchange rates). Structured financing activities
at €326 million rose +27.2% compared to fourth quarter 2021 in all
business segments. Commercial banking recorded more mixed results
with continued strong growth in the International Trade &
Transaction Banking segment in a context of rates returning to
positive and strong customer demand, which offset the decline in
the Corporate & Leveraged Finance segment. At €498 million, its
revenues grew by +0.8% over fourth quarter 2021. Capital
markets and investment banking at €612 million was
supported by an excellent commercial momentum and grew by +22.1%
from fourth quarter 2021 (+22,8% excluding foreign exchange
impact), as the market effects of the third quarter were less
pronounced this quarter. Investment banking also posted a strong
quarter at €104 million (+17.4% over fourth quarter 2021), drawn by
the strong results of the Equity Solutions products.
Over the full year in 2022, the Corporate and
investment bank thus strengthened its commercial positions with
underlying revenues up +11.3% over 2021 at €5 735 million
(+7.3% at constant foreign exchange rates). Underlying revenues in
financing activities increased to
€3,101 million in 2022, up +11.7% over the full year in 2021
and (+5.9% excluding the foreign exchange impact). Financing
activities thus strengthened its leading position in syndicated
loans (#1 in France52 and #2 in EMEA52) and was ranked #4 in
project finance loans worldwide52. Revenues from capital
markets and investment banking were up to €2,634 million
over financial year 2022, i.e. +10.8% over 2021 and +9.0% excluding
the foreign exchange impact. CACIB reaffirmed its leading
positions in bond issues, becoming #3 All bonds in EUR
Worldwide52, and returning to #1 Green, Social & Sustainable
bonds in EUR53. Average regulatory VaR was stable
from third quarter 2022 at €19.1 million for fourth quarter 2022,
versus €6.4 million in fourth quarter 2021 (and
€10.9 million in fourth quarter 2020), reflecting the market
and interest rate shocks over the period. However, it remained at a
low level, reflecting prudent risk management.
On 17 October 2022, CACEIS announced it was
entering into a Master Agreement stipulating CACEIS’s potential
acquisition of RBC’s investors services activities in Europe. This
was confirmed with the signing of a binding agreement (SPA) by the
two parties end December 2022. With this acquisition, CACEIS will
strengthen its position among the world leaders in asset servicing,
becoming #1 in Europe in assets under administration with nearly
€3,500 billion54 and #2 in assets under custody at €4,800
billion54. This transaction will also diversify the customer
profile by lowering the portion of French customers to 50%,
primarily in favour of customers from English-speaking countries
and Luxembourg.
The completion of the transaction is subject to
the usual conditions precedent, including the applicable regularly
approvals. This transaction is in line with the Group’s development
targets and will respect our profitability criteria with an
expected return on investment of more than 10% over 3 years thanks
to the realisation of synergies. After integration costs, the
additional net income (before non controlling interest) expected in
2026 would be higher than €100 million. The transaction will have a
negative impact of less than -10 basis points on the CET1 of
Crédit Agricole S.A. and Crédit Agricole Group55 at the
closing date planned for third quarter 2023.
The year-end also saw the formation of Uptevia
on 1 January 2023, a 50/50 joint venture combining the issuer
services business lines56 of CACEIS and BNP Paribas. This new
entity fulfils the aim of providing a specialised, enhanced and
evolving services offer to Corporate customers in France, by
building on a robust and agile architecture and dedicated
teams.
In fourth quarter 2022, the very significant
market effects of recent quarters on the assets of Asset
servicing (CACEIS) declined slightly. Assets under
custody (AuC) rose by
+2.9% at end December 2022 compared to end September 2022 (down
-10.7% from end December 2021), to reach €4,090 billion.
Assets under administration
(AuA) were up +3.0% over
the quarter (-9.7% year-on-year), to €2,172 billion at end
December 2022. The momentum of the customer business was not enough
to offset the impact of long term rates or equity markets evolution
on assets.
Results of the Large Customers division
In fourth quarter 2022,
the underlying revenues of the Large customers
division amounted to €1,775 million, up +13.7% compared to
fourth quarter 2021, buoyed by an excellent performance in the
corporate and investment banking activities and the asset servicing
business lines. Operating expenses excluding SRF
rose slightly over fourth quarter 2021 (+5.1%), benefiting from
economic effects and mitigating the impact of the increase in
expenses related to the activity. Thus, gross operating
income for the division recorded strong growth (+27.0%)
over the quarter. The division recorded an overall net provision
for cost of risk of -€15 million in fourth quarter 2022,
including reversals of legal provisions and additional provisions
on Russian exposures, compared to a provision of -€1 million
in fourth quarter 2021. Pre-tax income totalled €755 million,
up significantly by +23.5%. The tax charge increased by +6.1% to
€163 million. Lastly, net income Group share
reached €418 million in fourth quarter 2022, an increase of
+30.2%.
Over 2022, underlying revenues
of the Large Customers division was €7,012 million, an
increase of +10.8% over 2021. Operating expenses excl.
SRF increased by +6.8% to €3,905 million, reflecting
support for growth and IT investments (including the enhancement of
the F/O platform and improvement in the e-business offer in capital
markets). SRF expenses recorded a net increase of
+34.7% compared with 2021 at €442 million. Therefore, gross
operating income for the period amounted to €2,665
million, an increase of +13.6% over 2021. The cost of
risk over 2022 was a net allocation of -€251 million
compared with an allocation of -€39 million over 2021, essentially
because of the impact of the Russia/Ukraine war and its
consequences for provisions on performing loans in 2022 (allocation
of -€374 million on stage 1 and 2 Russian exposures). The business
line’s contribution to underlying net income Group
share was at €1,709 million, up +4.9% compared to
2021.
The business line contributed 28% to the
underlying net income Group share
of Crédit Agricole S.A.’s core businesses (excluding
Corporate Centre division) over the year 2022 and 30% to
underlying revenues excluding Corporate
Centre.
At 31 December 2022, the equity
allocated to the division was €13.3 billion and
risk weighted assets were €139.5 billion.
The business line’s underlying
RoNE (Return on Normalised Equity) stood at 12.5%
for the full year 2022 (versus 13.1% for 2021).
Corporate and Investment banking
results
In fourth quarter 2022,
underlying revenues of Corporate and investment
banking posted a record performance of €1,436 million, an
increase of +14.8% over fourth quarter 2021 (+12.4% at constant
foreign exchange rates) carried by all its business lines.
Underlying operating expenses excluding
SRF were up +8.2% (+6.4% at constant foreign exchange
rates) to -€779 million, reflecting human resources and IT and
investments in accordance with Medium term plan strategy and
encompassing a positive tax effect. Gross operating
income reached a high level of €657 million, an increase
of +23.6% over fourth quarter 2021 (+20.6% at constant exchange
rates) and the cost/income ratio was 54.2%. The cost of
risk recorded a net provision of -€12 million, compared to
a provision of -€2 million in fourth quarter 2021, which can be
explained by the provisioning on credit risk of -€62 million and a
reversal of legal risk provisions of +€39 million in capital
markets and investment banking. Provisions for credit risks include
additional provisions on Russian exposures in the amount of
€127 million. Lastly, pre-tax income in
fourth quarter 2022 stands at +€664 million, up +21.5% compared
with fourth quarter 2021. The tax charge is -€148 million. In
the end, underlying
net income Group share was
€485 million in fourth quarter 2022, an increase of +30.0%
over fourth quarter 2021.
Risk-weighted assets at end December
2022 declined sharply by -€13.8 billion compared with end
September 2022 in line with controlled organic growth and
favourable external impacts (-€9.9 billion including foreign
exchange impacts – market and credit), to €130.2 billion.
In 2022, underlying revenues
also posted a record performance and climbed by +11.3% compared to
2021, to €5,735 million, up +7.3% at constant exchange rates.
Underlying expenses excluding SRF increased by
+9.1% (+6.3% at constant exchange rates), related to the organic
growth strategy and business development of CIB, whereas SRF
expenses were up more significantly in the financial year, by
+30.2% to -€384 million. Thus, underlying gross
operating income at €2,328 million was up sharply
(+11.7% compared to 2021; +5.8% at constant exchange rates), and
the cost/income ratio (excluding SRF) was 52.7%. The cost of risk
recorded an accrual of -€248 million in 2022, in keeping with
the provisioning of Russian exposures (provisions of
-€536 million on Russian exposures, of which -€374 million for
performing loans), compared to -€47 million in 2021. The tax
charge was -€515 million, up +10.8%, and the contribution from
the business line to net income Group share was up
by +1.9% to €1,530 million.
Asset servicing results
In fourth quarter 2022, underlying
revenues of asset servicing were up a strong +9.3%
compared to fourth quarter 2021, to €339 million. This
increase was mainly due to the good performance of the interest
margin over the period (+72.6%), linked to the cash management
activity, which benefited from the rise of interest rates and
offset the decline in fee and commission income resulting from the
market impact on assets. Underlying operating
expenses excluding SRF were down to -€222 million (-4.5%),
but stable at constant scope57 at +0.2%. They benefited from the
streamlining of real estate costs, which helped absorb IT
investments. As a result, underlying gross operating
income was up sharply by +49.9% to €118 million in
fourth quarter 2022. The quarter also posted -€8.4 million in
net income for other assets due to the acquisition of the European
operations of RBC Investor Services. Underlying net
income totalled €88 million, a rise of +31.0%. After
sharing €28 million with non-controlling interests, the
business line’s contribution to underlying net income Group
share during fourth quarter 2022 was up +31.8%
year-on-year to €60 million.
Underlying revenues for 2022
were up +8.2% compared to 2021, driven by the increase in the net
interest margin (+35.2%), which offset the decline in fee and
commission income linked to the drop in assets and flow activities,
which nevertheless remained high. Underlying expenses
excluding SRF were under control at
-€882 million, down slightly compared to 2021 (-0.4%), thanks
in particular to the impacts of the operational efficiency plan, in
which the HR transformation costs were provisioned in 2021.
SRF expenses were up +74.6% compared to 2021, to
-€58 million. Thus, underlying gross operating
income was up +29.2% compared to 2021, and underlying
net income was up +25.2%. The overall contribution
of the business line to net income Group share in
2022 was €180 million, a +26.0% increase.
Specialised financial services activity
In fourth quarter 2022, the
commercial production of Crédit Agricole Consumer
Finance (CACF) continued to show strong momentum at
€12.1 billion, or +7.9% in fourth quarter 2022 compared to
fourth quarter 2021, driven by very strong activity in automotive
joint ventures (+25.2%). In 2022, consumer finance
production was €47.8 billion, up +10.5% from 2021, also driven
by automotive partnerships (+16.1%) and operations in Italy
(+18.0%).
Commercial production
in leasing of Crédit Agricole Leasing and Factoring
(CAL&F) in the fourth quarter 2022 experienced
a cyclical slowdown of -6.4% compared to fourth quarter 2021.
Commercial factoring production also fell by -50.4%, compared with
a record fourth quarter 2021 that had seen the signing of several
major customers. In 2022, production in leasing
was up +8.9% to €7.4 billion, driven by excellent renewable
energy sector production, which again exceeded €1 billion.
However, factoring production was down to €16.5 billion
(-9.6%).
A major component of the division’s activity
this year was the continuing implementation of the agreement
between CACF and Stellantis, which is expected to enter into force
in second quarter 2023. CAL&F also continued to integrate Olinn
and to implement new offerings and new growth initiatives such as
CAL&F’s acquisition of a stake in Watèa (50/50 joint venture
with Michelin in long-term rentals of electric vehicles for small
businesses) and the launch of the ESG impact factoring service for
large corporates, which offers price incentives based on CSR
criteria.
At end December 2022, CACF’s total outstandings
therefore stood at €103.0 billion, i.e., +11.4% compared to
end December 2021. Leasing outstandings were €17.6 billion at
end December 2022 (of which €14.1 billion in France and
€3.5 billion abroad), i.e., +8.4% compared to end December
2021. Factored revenues for the quarter jumped to
€31.2 billion, up by +17.1%, due to the economic recovery and
the ramp-up of the pan-European platform. Over the year, factored
revenues exceeded €100 billion, reaching €115.4 billion,
up +26.4% from 2021.
Specialised financial services’ results
Underlying revenues of specialised financial
services were €710 million in fourth quarter 2022, up +2.9%
compared to fourth quarter 2021. This resulted from stable CACF
revenues as margins continued to shrink but production grew, and,
for CAL&F, from an increase in factored revenues and the
inclusion of Olinn in the scope. Underlying expenses excluding SRF
totalled -€359 million, i.e., a +2.2% increase. Underlying
gross operating income was up (+3.6%), while the
underlying cost/income ratio excluding SRF
remained low at 50.6% (- 0.4 percentage point). The
underlying cost of risk was up +7.1% compared to
fourth quarter 2021 but remained contained. Underlying net income
Group share totalled €198 million, up by +14.5%.
In 2022, underlying revenues in
Specialised Financial Services increased by
+3.1%58 compared to 2021, driven by a strong performance at CACF
and CAL&F. Underlying expenses excluding SRF
were up +4.3%. The
underlying cost/income ratio excluding SRF
remained low at 51.9%, an increase of
+0.6 percentage point. The contribution to the
SRF amounted to -€34 million for 2022, an increase of
+47.9%. The underlying cost of risk therefore rose
by +5.5% to -€533 million. The underlying contribution of
equity-accounted entities increased by +4.6% to €316 million.
Underlying net income Group share was therefore up
+4.0% to €767 million.
The business line contributed 12% to the
underlying net income Group share of
Crédit Agricole S.A.’s core businesses (excluding
Corporate Centre division) in 2022 and 12% to underlying
revenues excluding Corporate Centre.
At 31 December 2022, the equity
allocated to the division was €5.6 billion
and the division’s risk-weighted assets were
€58.9 billion.
The business line’s underlying
RoNE (return on normalised equity) was 14.5% for
the full year 2022 (versus 15.2% for 2021).
Consumer finance results
CACF’s underlying revenues were
€530 million in fourth quarter 2022, stable compared to the
same period in 2021, as margins continued to shrink – with a
gradual rise in customer rates and continued rise in refinancing
costs – but with production climbing. Expenses excluding SRF were
down -2.7% compared to fourth quarter 2021 benefitting from a
one-off positive impact in the quarter. Underlying gross operating
income was thus €268 million, up +2.8%, and the underlying
cost/income ratio excluding SRF remained low at 49.4%, down
-1.4 percentage points compared to fourth quarter 2021.
Underlying cost of risk remained contained at
-€122 million, up +1.4%, and measures to
tighten the loan approval policy are currently being
implemented.namely in France and Italy The cost of risk on
outstandings was thus 125 basis points59 for the quarter.
After integrating the cost of risk of automotive joint ventures,
this cost stood at 99 basis points for the quarter. The
non-performing loans ratio was 5.0%, stable compared to end
September 2022, and the coverage ratio was 86.3%, down
-2 percentage points compared to end September 2022. The
underlying contribution of equity-accounted entities was
€76 million (+13.5%) up across the business line’s three joint
ventures. Underlying taxes were -€44 million in fourth quarter
2022, an increase of +21.5%. Underlying net income Group share
totalled €151 million in fourth quarter 2022, up by
+14.1%.
In 2022, underlying revenues
were €2,126 million, up +1.4% from 2021, with buoyant activity and
increase in outstandings, particularly in the automotive sector,
offsetting pressure on the margins following the gradual but
delayed rise in customer rates. Underlying expenses excluding SRF
increased by +1.0% to €1,079 million, and the SRF contribution
was -€16 million (+65.3% compared to 2021). The underlying
cost/income ratio excluding SRF
remained low at 50.7%, a decline of
-0.2 percentage point. Underlying gross operating income
was €1,031 million, up +1.1%. The underlying cost of risk
increased by +7.9% and reached -€480 million. The cost of risk
on outstandings therefore stood at 127 basis points60in
2022. After integrating the cost of risk of automotive JVs, it
stood at 100 basis points for the year, the non-performing
loan ratio stood at 5.0%, stable compared to end December 2021, and
the coverage ratio reached 86.3%, down – 2.1 percentage
points compared to end December 2021. The contribution of
equity-accounted entities rose by +4.6% in
underlying terms, to €316 million. All in all, the business
line’s contribution to underlying net income Group
share amounted to €595 million for 2022, up +0.5% in
underlying terms.
Leasing & Factoring
results
Underlying
revenues were €180 million, up +12.5%
compared to fourth quarter 2021 due to higher factored revenues and
the integration of Olinn (revenues up +6.7% at constant scope).
Underlying expenses excluding SRF were up by +18.0% (9.6% at
constant scope) due mainly to the increase in wages and fees, and
IT investments related to the economic situation and growth in
business activity. The underlying cost/income ratio
excluding SRF was 54.1%, an improvement of
+2.5 percentage points compared to
fourth quarter 2021. Underlying gross operating
income totalled €83 million, up +6.6% (+3.7% at
constant scope). Underlying cost of
risk remained low, at €23 million, and underlying
net income Group share was €47 million, up
+15.8% (+10.2% at constant scope).
In 2022, underlying
revenues were €655 million, up +9.4% (+4.3%
at constant scope) from end December 2021 thanks to buoyant
factoring activity that offset the tightening of the margins of the
leasing operations. Underlying expenses excluding
SRF were up +15.6% (+7.5% at constant scope) with activity
growth and related IT investments, and a rise in compensation. The
contribution to the SRF amounted to -€18 million (+35.0%). Thus,
underlying gross operating income stood at €273
million, up +0.9% (decline of -1.0% at constant scope). The
underlying cost/income ratio excluding SRF worked
out at 55.6%, up +3.0 percentage points. Underlying cost
of risk totalled -€53 million, down -11.9%. Lastly, underlying
net income Group share was €172 million, up +18.4% (+15.7% at
constant scope).
Crédit Agricole S.A. Retail Banking
activity
The Crédit Agricole S.A.
Retail banking activity was strong this quarter,
driven at LCL by the production of corporate loans and loans to
small businesses, and at Crédit Agricole Italia by strong
activity across all segments.
LCL’s commercial activity was
buoyant throughout 2022. Loan production remained strong in fourth
quarter 2022 compared to fourth quarter 2021 (-6%61), driven by
activity in the small businesses market (+6%). Home loan production
was down (-10%) amid a slowdown in loan applications (-17% drop in
home loan production according to Banque de France), with an
increase of +50 basis points of the loan rate between third
quarter 2022 and fourth quarter 2022 at LCL. In 2022, loan
production at LCL was very robust, totalling €41.8 billion –
an increase of +17.5% compared to 2021 – driven by corporate loans
(+33.8%) and loans to small businesses (+22.6%).
Outstanding loans totalled €164.3 billion at end
December 2022 and were up +9.1% from end December 2021, including
+8.9% for home loans, +8.6% for loans to small businesses, +11.4%
for corporate loans and +4.2% for consumer finance. Customer
assets, which totalled €236.2 billion at end December 2022,
were also up: by +1.6% compared to end December 2021, driven by
on-balance sheet deposits (+4.3%) from the increase in passbooks
and time deposits, and despite off-balance sheet savings, which
fell by -4.1% due to an unfavourable market effect.
Gross customer capture amounted to 342,300 new
clients over the year (78,900 in the fourth quarter), and the
increase in the customer base was 40,200 customers over the year.
Lastly, the equipment rate for car, home, health, legal, all mobile
phones or personal accident insurance rose by +0.5 percentage point
compared to the fourth quarter of 2021, standing at 27.1% at the
end of December 2022.
In terms of offerings, 2022 saw the launch of a
100% digital offering, LCL Essentiel Pro, with extra-banking
services for micro-entrepreneurs and self-employed professionals;
the introduction of Flex, an innovative solution for instant
mini-loans on the mobile application; the development of new
partnerships within the framework of smart business; and
outstandings to €1,9 billion in funds LCL Climate impact and LCL
society and solidarity impact.
CA Italia’s activity was strong
over the year and highly dynamic in the fourth quarter of 2022,
benefiting from the diversification of the Group’s activities in
Italy. Gross customer capture over twelve months thus reached
150,000 new customers62. Loan outstandings at CA Italia reached €60
billion at the end of December 2022, up +1.1% compared to the end
of December 2021. The production of corporate loans63 and consumer
finance64 was dynamic, respectively reaching +6.3% compared to
fourth quarter 2021 and +21.7% compared to all twelve months in
2021, and +15.0% compared to fourth quarter 2021 and +26.6%
compared to all twelve months of 2021. Home loan production was
resilient in a declining market in Italy over all twelve months of
2022, but rebounded in fourth quarter 2022 (+5% compared to fourth
quarter 2021), allowing CA Italia to gain market share year-on-year
(7.1% in fourth quarter 2022 compared to 6.2% in third quarter
2022). Customer assets at end December 2022 amounted to €111.9
billion, down -3.4% compared to end December 2021 due to a negative
market effect on managed savings and a decline in on-balance sheet
savings despite positive inflows from individuals, professionals
and private banking.
CA Italia’s equipment rate in car, multi-risk
home, health, legal, all mobile phones or personal accident
insurance increased to 21.2%, or 16.8% including Creval.
2022 was marked by the finalisation of the
integration of the Credito Valtellinese banks and the merger of CA
FriulAdria into CA Italia, allowing synergies to be strengthened
with the other Crédit Agricole Group entities and the
completion of the Banca Unica Project. CA Italia has strengthened
its customers’ energy transition journey by launching two ESG
products dedicated to the agri-food sector: Agri Energia is a line
of financing to support corporates in the construction, expansion
and upgrade of sustainable energy production facilities, while Agri
Blu aims to finance renovations and the purchase of machinery and
equipment for the management of energy, irrigation and waste water,
supply cycles, and the processing and distribution of products.
CA Italia was awarded the title of “Top Employer
Italia 2023” for the 15th consecutive year. This recognition
rewards Italian corporates that are leaders in human resources
management.
For International Retail Banking
excluding Italy, loan outstandings were down -46.1% at end
December 2022 compared to end December 2021, and customer assets
were down -39.7% over the same period.
Excluding disposed
entities65 and Ukraine, i.e.
while considering Poland and Egypt, loan outstandings were
up by +8.8% at constant exchange rates (-2.6% at current exchange
rates) and customer assets by +12.0% at constant exchange rates
(-1.0% at current exchange rates) over the same period. In
particular, in Poland, loan outstandings increased by +5.5% between
end December 2022 and end December 2021 (+7.5% at constant exchange
rates) and customer assets by +5.8% over the same period (+7.8% at
constant exchange rates). In Egypt, loan outstandings were impacted
by the devaluation of the Egyptian pound in Q4 and fell by -23.7%
between end December 2022 and end December 2021 (+13.5% at constant
exchange rates) and customer assets by -15.7% over the same period
(+25.3% at constant exchange rates). The surplus of deposits over
loans in Poland and Egypt amounted to €2.4 billion at 30
December 2022, and reached €3.3 billion including Ukraine.
Finally, the Group continues to expand its
universal customer-focused banking model in Poland. Gross customer
capture stood at 228,000 new customers in the country in 2022 (net
customer capture of 104,000 customers).
French retail banking
results
In fourth quarter 2022, LCL’s
underlying revenues were down by -1.6% compared to fourth quarter
2021, at €915 million. The decrease in the net interest margin
(-6.7%) linked to the increase in the cost of resources was limited
by the repricing of credit rates on the corporates market. This was
partly offset by the increase in fee and commission income (+4.5%),
which was driven by growth in fee and commission income from
payment instruments. Costs excluding SRF, which amounted to €581
million, were down (-3.7% compared to fourth quarter 2021) due to
non-recurring items, particularly tax items. The underlying
cost/income ratio excluding SRF improved by
1.4 percentage points to 63.5%. Underlying gross
operating income was therefore up by +2.3% to €334 million.
The cost of risk was also up by +43.6% to -€78
million (including -€11 million in cost of risk on performing
loans, -€61 million in proven risk, and -€6 million in other
risks). The coverage ratio stood at 66.2% at end December, down
this quarter (-14 percentage points), mainly due to the impact of a
specific provision that was written off as non-performing when it
was already provisioned under performing loans. The non-performing
loans ratio was 1.75% at end December 2022, up
+0.31 percentage point compared to end September 2022.
As a result, net income Group share remained
stable (-0.2%) compared to fourth quarter 2021.
In 2022, LCL’s stated net
income Group share stood at €899 million, an increase of +17.7%
compared to 2021. After taking into account specific items (in
particular provisions for home purchase savings, with an impact of
+€34 million on revenues and +€24 million on income), the
underlying net income Group share came to €875 million, up
+13.1%.
LCL’s underlying revenues rose by 3.2% compared
to 2022 to reach €3,816 million, driven by the net interest
margin (+1.0%), which was supported by corporate and professional
activity and, secondly, by fee and commission income (+5.1%),
particularly on non-life insurance and payment instruments.
Underlying costs excluding SRF were slightly increasing (+0.9%),
still under control, and include measures for salaries (collective
compensations, value redistribution premium) in a context of
increasing inflation. The underlying cost/income ratio excluding
SRF, which stood at 60.4%, improved again this year compared to
2021 (-1.3 percentage points) and is well below the MTP target. The
contribution to the SRF increased by +17.1% (+€10 million). As a
result, gross operating income was up +7.7%. The cost of risk,
which is normalising, increased by +6.7% to reach -€237 million
(including -€193 million for proven risk, -€65 million for
provisioning for healthy loans, and -€19 million for other risks).
The cost of risk relative to outstandings came to 15 basis
points at the end of 2022, versus 20 basis points
for the quarterly average of 2019.
All in all, the business line’s contribution to
underlying net income Group share of Crédit Agricole SA stand at
14% (part in business lines net income group share excluding
corporate center).
At 31 December 2022, the capital
allocated to the business line stood at €5 billion
and risk weighted assets stood at
€52.1 billion. LCL’s underlying return on normalised equity
(RoNE) stood at 17.4% for 2022 compared to 15.2% for 2022.
International Retail Banking
results
Within International Retail Banking, Creval
acquired by CA Italia, has been consolidated since 30 April 2021;
controlling interest in Crédit du Maroc sold in Q4 2022, after its
classification under IFRS 5 in first quarter 2022 (disposal of
63.7%, with the residual 15% stake accounted for under IFRS 5);
finally, Crédit Agricole Serbia was sold on 1 April 2022. The
income of the latter two entities was recognised in 2022 under
IFRS 5, impacting all profit and loss lines of International
Retail Banking excluding Italy on a quarterly and cumulative
basis.
Underlying revenues of International Retail
Banking rose by +8.7% to €896 million in fourth quarter 2022.
Excluding Crédit du
Maroc, Crédit Agricole Serbia and Crédit
Agricole Ukraine, underlying revenues of the international
retail banking division rose by +15.7% in fourth quarter 2022
compared to fourth quarter 2021 due to the impact of the interest
rate hike on the net interest margin. Underlying expenses excluding
SRF were stable at -€593 million in fourth quarter 2022.
Excluding Crédit du
Maroc, Crédit Agricole Serbia and
Crédit Agricole Ukraine, expenses were up
by +7.0%, in particular due to the impact of inflation on salaries.
As a result, underlying gross operating income amounted to
+€303 million, i.e an increase of +31.4%. Excluding
Crédit Agricole Serbia, Crédit du Maroc
and Crédit Agricole Ukraine, underlying Gross
Operating Income rose by +41.1%. The underlying cost of risk stood
at -€189 million, an increase of +44.0%, mainly from
international retail banking outside Italy. In Ukraine (whose gross
operating income is zero), the cost of risk for fourth quarter 2022
stood at -€41 million.
All in all, the stated net income Group
share of the International Retail Banking division
amounted to €150 million in fourth quarter 2022, compared to -€16
million in fourth quarter 2021. Specific items in fourth quarter
2022 amounted to €132 million in net income (€100 million in net
income Group share) and include a favourable realinemento tax
impact of +€146 million in Retail Banking in Italy, partly offset
by an additional provision of -€14 million for the disposal of
Crédit du Maroc. The underlying net income Group share of
International Retail Banking was €50 million in fourth quarter
2022, down -20.2% compared to fourth quarter 2021.
Excluding Crédit Agricole Serbia, Crédit du
Maroc and Crédit Agricole
Ukraine, the underlying net income Group share of the
International Retail Banking division was up 91.5% compared to
fourth quarter 2021.
For 2022, the underlying revenues of the
International Retail Banking division amounted to €3,320
million, up +6.5% compared to 2021. Pro forma for Creval, which has
been consolidated since 30 April 2021, excluding Crédit du Maroc,
classified under IFRS 5 in the first quarter of 2022, excluding
Crédit Agricole Serbia, sold on 1st April 2022, and excluding
Crédit Agricole Ukraine, revenues of the International Retail
Banking division rose by +5.8% in 2022 compared to 2021, due to the
impact of the rate hike on the net interest margin, particularly in
Poland and Egypt. Division’s underlying operating expenses
excluding SRF amounted to -€2,036 million in 2022, up +3.0%
compared to 2021. Pro forma for
Creval, excluding Crédit Agricole Serbia,
Crédit du Maroc and Crédit
Agricole Ukraine, and excluding SRF, underlying operating
expenses increased by +2.9% in 2022 compared to 2021. The
contribution to SRF amounted to -€38 million in 2022, up
+15.7% compared to 2021. As a result, underlying gross operating
income stood at +€1,246 million, an increase of +12.6% in 2022
compared to 2021. Pro forma for Creval, excluding Crédit Agricole
Serbia, Crédit du Maroc and Crédit Agricole Ukraine, underlying
Gross operating income was up +12.1%. The stated cost of risk
amounted to -€700 million in 2022, down -10.2% compared to 2021,
including a Ukraine provision for -€195 million classified as a
specific item. Underlying cost of risk totalled -€505 million
in 2022, an increase of +15.9%. In summary, in 2022, the total
amount of provisioning for Ukraine’s cost of risk (as a reminder,
Crédit Agricole Ukraine’s gross operating income was zero in 2022)
amounted to -€323 million, including -€195 million provisioned in
the first quarter of 2022 (classified as specific items) and -€128
million in additional provisioning over 2022 by Crédit Agricole
Ukraine (additional provisioning on the total of €842 million in
loan outstandings in Ukraine).
All in all, the underlying net income Group
share of the International Retail Banking division was
€411 million in 2022, up +15.0% compared to 2021. Pro forma
for Creval, excluding Crédit Agricole Serbia, Crédit du Maroc and
Crédit Agricole Ukraine, the underlying net income Group share of
the International Retail Banking division was up +41.8% in 2022
compared to 2021.
Results in Italy
In the fourth quarter of 2022, CA Italia’s
underlying revenues were up (+14.5%) compared to fourth quarter
2021, standing at €684 million. The rate hike benefited the
net interest margin, and production rates increased by 30 basis
points between the fourth and third quarters of 2022. Operating
expenses amounted to €483 million, up +7.1% compared to fourth
quarter 2021, mainly due to higher IT expenses (notably related to
the IT transformation plan), as well as the final integration costs
of Creval and the Friuladria merger, and despite Creval’s cost
synergies, which represented around €30 million in 2022. CA
Italia’s operational efficiency allowed for positive jaws of +7.5
percentage points this quarter, compared to fourth quarter 2021.
All in all, gross operating income increased by +37.6% compared to
fourth quarter 2021.
The underlying cost of risk amounted to -€131
million in fourth quarter 2022, including -€109 million for proven
risk and -€17 million in provisioning for performing loans. It was
up by +11.2% compared to fourth quarter 2021. The
cost of risk on outstandings66 came out at
51 basis points, the non-performing loans ratio stood at 3.7%
at 31 December 2022 and the coverage ratio at 64.7%. The underlying
net income Group share of CA Italia thus stood at €36 million, up
+70.1% compared to fourth quarter 2021.
For the full year 2022, Crédit Agricole Italia’s
underlying revenues increased by +11.5% to €2,543 million. Pro
forma for the acquisition of Creval, which has been consolidated
since 30 April 2021, revenues were up by +2.8%, thanks to the +6.0%
increase in the net interest margin in 2022 vs 2021 in a rising
rates environment. Underlying expenses excluding SRF were up over
2021 (+10.0%) at -€1,599 million. Pro forma for Creval,
expenses excluding SRF rose by 0.9%, with positive jaws of +1.9
percentage points.
The underlying cost of risk was -€312 million,
down -10.1% (including -€25 million in provisions on performing
loans and -€270 million in provisions for proven risks).
Ultimately, the underlying net income Group share was
€334 million for CA Italia, up +36.9% compared with 2021
and +30.1% pro forma for Creval.
CA Italia’s underlying RoNE (return on
normalised equity) for 2022 was 10.8%, compared to 9.0% in
2021.
Crédit Agricole Group in Italy
results
The Group’s underlying net
income Group share in Italy reflected the
excellent performance of the Group’s various business lines and
stood at €857 million in 2022, an improvement of +14.2%
compared to 2021. The Group’s underlying net income Group share in
Italy represents 14% of Crédit Agricole S.A.’s67
underlying income, and Crédit Agricole Italia’s income represents
39% of the Group’s income in Italy.
International Retail Banking results –
excluding Italy
Within the scope of International Retail banking
excluding Italy, Crédit du Maroc was classified under IFRS 5 in
first quarter 2022 and control was sold in fourth quarter 2022, and
Crédit Agricole Serbia was sold on 1st April 2022. The income of
these two entities is recognised in 2022 under IFRS 5,
impacting all profit and loss lines of International Retail Banking
excluding Italy on a quarterly and cumulative basis.
In a context of continued conflict in Ukraine,
commercial activity remains heavily penalised and the operations of
Crédit Agricole Ukraine reduced. Income was at zero this quarter as
provisions were increased to the amount of gross operating
income.
The following data for the fourth
quarter for retail banking outside Italy are therefore
presented at constant scope68,
i.e., excluding Crédit Agricole Serbia, Crédit du Maroc and Crédit
Agricole Ukraine. This scope thus corresponds to the
cumulative view of Egypt and Poland. Revenues
totalled €161 million in fourth quarter 2022 and were up +21.7%
over fourth quarter 2021 due to the increase in net interest
margin. Operating expenses excluding SRF increased by +8.0%,
against a backdrop of high inflation in Poland and Egypt. Gross
operating income excluding SRF amounted to €75 million, an increase
of +42.7% compared to fourth quarter 2021. The cost of risk was
-€17.4 million, down -1.4%, and takes into account provisioning of
the CHF loans at 48% in Poland. All in all, the business line’s
contribution to net income Group share was €28.4 million, an
increase of +76.7%.
The following data for the twelve months
of 2022 for Retail banking excluding Italy are therefore
presented at constant scope and excluding
Ukraine69. This scope
thus corresponds to the cumulative view of Egypt and Poland.
Revenues totalled €593 million and were up +21.8%
compared to 2021, in a context of higher rates, driven by the
growth in the interest margin in Poland and of the Corporates
activity in Egypt. The exceptional provision of -€21 million for
moratoria in Poland remained unchanged in the fourth quarter
compared to the third quarter. Operating expenses rose by 14.2% in
Poland in particular because of IT investments as well as
investments to support the growth of the activity. Gross operating
income amounted to +€261 million, an increase of +33.2%. Cost
of risk totalled -€65 million, a decrease of -10.7%. All in
all, the contribution of the business line to net income Group
share was €96 million, an increase of +77.9% over 2021.
International retail banking contributed 7% to
the underlying net income Group share of
Crédit Agricole S.A.’s core businesses (excluding
Corporate Centre division) over the year 2022 and 14% to underlying
revenues excluding Corporate Centre division.
At 31 December 2022, capital allocated to the
International retail banking business line was €4.4 billion,
and risk-weighted assets stood at €46.2 billion.
The underlying RoNE (return on normalised
equity) of Other IRB stood at 12.6% in 2022, compared with 14.4% in
2021.
The entire Retail banking business line
contributed for 21% to the underlying net income Group share of
Crédit Agricole S.A.'s core businesses (excluding the
Corporate Centre division) in 2022 and 30% to underlying revenues
excluding Corporate Centre.
As at 31 December 2022, the equity allocated to
the division was €9.3 billion, including €5.0 billion for
French retail banking and €4.4 billion for International
retail banking. Risk weighted assets for the division totalled
€98.3 billion, including €52.1 billion for French retail
banking and €46.2 billion for International retail
banking.
Corporate Centre results
The underlying net income Group share of the
Corporate Centre division was -€164 million in fourth quarter
2022, down -€138 million compared with fourth quarter 2021.
The negative contribution of the Corporate Centre can be analysed
by distinguishing between the “structural” contribution
(-€153 million) and other items (-€11 million). The
contribution of the “structural” component decreased by -€44
million from fourth quarter 2021 and can be broken down into three
types of activity:
- The activities
and functions of the Corporate Centre of the Crédit
Agricole S.A. corporate entity. This contribution reached
-€166 million in fourth quarter 2022, an increase of +€9
million, integrating a decline in revenues primarily associated
with the effect of inflation on the Corporate Centre division,
which was offset by positive tax impacts;
- The businesses
not attached to the business lines, such as CACIF (Private equity),
CA Immobilier and BforBank (equity-accounted): their
contribution, at +€12 million in fourth quarter 2022, was down -€52
million from fourth quarter 2021, and is explained by a basis
effects related to revenues from disposals and revaluations of
Private Equity funds made in fourth quarter 2021;
- Group support
functions: their contribution amounted to +€1 million this quarter
(-€1 million compared with fourth quarter 2021).
The contribution of “other items” was down by
-€93 million from third quarter 2021, tied in particular to the
eliminations on intra-group securities underwritten by Predica and
Amundi.
Over 2022, the underlying net income Group share
of the Corporate Centre division was -€708 million, a decrease
of -€245 million compared with 2021. It is in line with the
target of net income Group share greater than
- €800 million presented in the Ambitions 2025
Medium-Term Plan. The structural component contributed
- €931 million, and other items of the division recorded
a positive contribution of +€223 million over the year 2022.
The “structural” component contribution is down -€240 million
compared with 2021 and can be broken down into three types of
activities:
- The activities
and functions of the Corporate Centre of the Crédit
Agricole S.A. corporate entity. This contribution amounted to
-€1,000 million for 2022, down -€171 million compared with
2021;
- The businesses
that are not part of the business lines, such as CACIF (Private
equity) and CA Immobilier and BforBank: their contribution of +€51
million in 2022 was down by -€79 million compared with 2021.
- The Group’s
support functions: their contribution was +€18 million in 2022, an
increase of +€9 million over 2021.
The contribution of “other items” was down (-€5
million) compared to 2021.As at 31 December 2022, risk weighted
assets were €27.9 billion.
* *
*
Financial strength
Crédit Agricole Group
As at 31 December 2022, the phased-in
Common Equity Tier 1 (CET1) ratio of Crédit Agricole Group
was 17.6%, an increase of +0.4 percentage points compared to end
September 2022. Therefore, Crédit Agricole Group posted a
substantial buffer of 8.7 percentage points between the
level of its CET1 ratio and the 8.9% SREP requirement70, and posted
the largest difference with the SREP among European GSIB banks71.
The fully loaded CET1 ratio is 17.2%. During the fourth quarter
2022 :
- The CET1 ratio benefited this
quarter from the impact of the retained earnings
of +26 bps.
- The organic growth in
the business lines and other
items positively impacted the Group CET1 by +20 basis
points, including a decline in risk weighted assets, excluding
foreign exchange impact, by - €5.9 billion (i.e. +18 basis
point impact), essentially linked to the capital market
activities72. Regarding the Insurance activity, the
equity-accounted value, excluding unrealised gains and/or losses,
increased by +€0.5 billion via income, generating an increase in
risk weighted assets of €2.0 billion (i.e. -6 basis point impact on
CET1 ratio). Last, other effects positively impact the CET1 ratio
by +8 basis points.
- The CET1 ratio
was also impacted this quarter by merger-acquisition transactions
that generated an increase of +12 basis points in the CET1, notably
with the disposal of Crédit du Maroc.
- The
anticipation in fourth quarter 2022 of the impact of the
purchase of Crédit Agricole
S.A.
shares by SAS La Boétie, planned
before the end of June 2023, reduced the CET1 ratio by -17 basis
points.
-
Insurance unrealised gains and/or losses had a
near-neutral impact this quarter73, impacting Group CET1 by -1
basis point.
- Last, the
additional pay-out to the
shareholder (i.e. the 20 cents distributed as the balance
of all accounts of the 2019 dividend not paid in 2020, as well as
the share buyback transaction that offset the diluting effect of
the capital increase for employees in 2022) reduced the CET1 ratio
by -7 basis points.
The total stock of unrealized losses was -19
basis points at 31 December 2022. As a result, restated for the
effects of the unrealised losses, the CET1 ratio rose over 2022 to
17.7% in December 2022, versus 17.4% at end December 2021 net of
+16 basis points of unrealised gains.
The phased-in Tier 1 ratio
stood at 18.6% and the phased-in total ratio was 21.6% this
quarter.
The phased-in leverage ratio
stood at 5.3%, up +0.2 percentage point compared to end September
2022, well above the regulatory requirement of 3%. In addition to
the minimum requirement of 3%, from 01/01/2023 and only for global
systemically important institutions (G-SII) a leverage ratio buffer
will be added, defined as half of the G-SII buffer of the entity,
amounting to 0.5% for the Crédit Agricole Group. Failure to comply
with the leverage ratio buffer requirement would result in a
restriction of distributions and the calculation of a maximum
distributable amount (L-MDA). As of 1st January 2023, based on data
as of 31/12/2022, Crédit Agricole Group would have a safety margin
of 184 basis points above the L-MDA trigger threshold, i.e. €37
billion euros of Tier 1 capital.
Risk weighted assets for
Crédit Agricole Group amounted to €575 billion, down by
-€14.0 billion compared to 30 September 2022. The organic
growth of the business lines contributed -10.8 billion to
this change, including -€4.9 billion foreign exchange effect and
+€2.1 billion for Regional Banks74. The
merger-acquisition transactions freed up -€4.2
billion of risk weighted assets, the Equity-accounted
value, including insurance unrealised gains and/or losses
increased risk weighted assets by +1.5 billion and, finally,
regulatory effects and methodology had a small impact of -€0.5
billion this quarter.
Maximum Distributable Amount (MDA)
trigger
The transposition of Basel regulations into
European law (CRD) introduced a restriction mechanism for
distribution that applies to dividends, AT1 instruments and
variable compensation. The Maximum Distributable Amount (MDA, the
maximum sum a bank is allowed to allocate to distributions)
principle aims to place limitations on distributions in the event
the latter were to result in non-compliance with combined capital
buffer requirements.
The distance to the MDA trigger is the lowest of
the respective distances to the SREP requirements in CET1 capital,
Tier 1 capital and total capital.
At 31 December 2022,
Crédit Agricole Group posted a safety
buffer of 796 basis points above the MDA trigger, i.e.
€46 billion in CET1 capital.
At 31 December 2022, Crédit Agricole
S.A. posted a buffer of 329 basis points above the
MDA trigger, i.e. €12 billion in CET1 capital.
TLAC
The TLAC ratio requirement was transposed into
European Union law via CRR2 and has been applicable since 27 June
2019. Crédit Agricole Group must comply with the
following TLAC ratio requirements at all times:
- a TLAC ratio
above 18% of risk weighted assets (RWA), plus – in accordance with
EU directive CRD 5 – a combined capital buffer requirement
(including, for the Crédit Agricole Group, a 2.5% capital
conservation buffer, a 1% G-SIB buffer and the counter-cyclical
buffer set at 0.05% for the CA Group at 31/12/22). Considering the
combined capital buffer requirement, the Crédit Agricole Group must
adhere to a TLAC ratio of above 21.5%;
- a TLAC ratio of
above 6.75% of the Leverage Ratio Exposure (LRE).
The Crédit Agricole Group’s
2025 target is to maintain a TLAC ratio greater than or equal to
26% of RWA excluding eligible senior preferred debt.
At 31 December 2022,
Crédit Agricole Group’s TLAC ratio stood
at 27.2% of RWA and 7.8% of leverage ratio exposure,
excluding eligible senior preferred
debt75, which is well above the
requirements. The TLAC ratio expressed as a percentage of
risk-weighted assets increased by 70 bps over the quarter in line
with the decrease in the RWA. Expressed as a percentage of the
leverage ratio exposure (LRE), the TLAC ratio rose 40 bps
compared to September 2022, with the decrease in the leverage ratio
exposure tied primarily to the TLTRO repayments.
The Group thus has a TLAC ratio excluding
eligible senior preferred debt that is 560 bps higher, i.e.
€32 billion, than the current requirement of 21.5% of RWA.
Over the year 2022, €5.9 billion equivalent
was issued in the market (senior non-preferred and Tier 2 debt).
The amount of Crédit Agricole Group senior non-preferred
securities taken into account in the calculation of the TLAC ratio
was €27.6 billion.
MREL
The required minimum levels are set by decisions
of resolution authorities and then communicated to each
institution, then revised periodically. Since 1 January 2022, the
Crédit Agricole Group has to meet a minimum total MREL requirement
of:
- 21.04% of RWA,
plus – in accordance with EU directive CRD 5 – a combined
capital buffer requirement (including, for the Crédit Agricole
Group, a 2.5% capital conservation buffer, a 1% G-SIB buffer and
the counter-cyclical buffer set at 0.05% for the CA Group at
31/12/22). Considering the combined capital buffer requirement, the
Crédit Agricole Group must adhere to a total MREL ratio of above
24.6%;
- 6.02% of the
LRE.
At 31 December 2022, the Crédit Agricole
Group had an estimated MREL ratio of 31.6% of RWA and 9.1% of
leverage exposure, well above the total MREL
requirement.
An additional subordination requirement to TLAC
(“subordinated MREL”) is also determined by the resolution
authorities and expressed as a percentage of RWA and LRE, in which
senior debt instruments are excluded, similar to TLAC, which ratio
is equivalent to the subordinated MREL for the Crédit Agricole
Group. Since 1 January 2022, this subordinated MREL requirement for
the Crédit Agricole Group did not exceed the TLAC requirement.
The distance to the maximum distributable amount
trigger related to MREL requirements (M-MDA) is the lowest of the
respective distances to the MREL, subordinated MREL and TLAC
requirements expressed in RWA.
At 31 December 2022,
Crédit Agricole Group had a buffer of
560 basis points above the M-MDA trigger, taking into
account the TLAC requirement applicable at 31 December 2022, i.e.
€32 billion of CET1 capital.
Crédit Agricole SA
At end-December 2022,
Crédit Agricole S.A.’s solvency level was higher than the
Medium-Term Plan target, with a phased-in Common Equity
Tier 1 (CET1) ratio of 11.2% (up 0.2 percentage point
from end-September 2022).. Crédit Agricole S.A. therefore
has a substantial buffer of 3.3 percentage points between the
level of its CET1 ratio and the 7.9% SREP requirement.76 This was
even higher than at end-September 2022, when it was 3.1 percentage
points. The fully loaded CET1 ratio is 11.0%. During the fourth
quarter 2022 :
- The CET1 ratio
benefited this quarter from a positive impact of +19 bps due
to retained earnings. This impact corresponds to
net income Group share, net of AT1 coupons (impact of +41 basis
points) and before the distribution of 50% of earnings (i.e. an
effect of -22 basis points).
- The change in
risk-weighted assets related to the business lines’ organic
growth and other items, excluding the
foreign exchange impact, raised the CET1 ratio by 19 basis points
during the quarter, which translated to a drop in risk-weighted
assets of -€7.9 billion (of which, SFS +€1.1 billion, Large
Customers - €9.9 billion,77 and Retail Banking +€0.6 billion).
The Insurance equity-accounted value, excluding
unrealised gains and/or losses, contributed to an increase in
risk-weighted assets of €2.0 billion (i.e. -6 basis point
impact on CET1), and other effects positively impacted the CET1
ratio by +1 basis point;
-
Mergers and acquisitions, particularly the
disposal of Crédit du Maroc, had a +12 basis point positive impact
on the CET1 ratio.
-
Insurance unrealised gains and/or losses had a
near-neutral impact this quarter, the recovery of the equity
markets and tightening of credit spreads offsetting the rise in
long rates during the quarter.
- The
additional distribution to shareholders corresponded to
the 20 cents due in respect of the 2019 dividend not paid in 2020,
and to the share buyback offsetting the dilutive effect of the 2022
employee capital increase. The total impact of this effect was a
-21 basis point reduction in the CET1 ratio.
For full year 2022, the CET1
ratio fell -70 basis points, of which -99 basis points can be
explained by economic effects, largely reversible over time: -88
basis points for insurance unrealised gains and/or losses, related
primarily to the impact of higher interest rates, and -12 basis
points in risk-weighted assets for credit risk associated with the
Russia/Ukraine crisis.78 Excluding these economic effects, capital
generation was positive by +56 basis points for the 2022 full year,
including an impact of +68 basis points from retained income over
one year, outpacing the organic growth of the business lines,
M&A and regulatory operations (specifically the impact of the
exceptional payment of a €2 billion dividend by
Crédit Agricole Assurances in the second quarter of
2022).
Restated for effects from bank and insurance
unrealised gains and/or losses, the CET1 ratio rose in 2022 from
11.6% at end-December 2021 net of +31 basis points of unrealised
gains, to 11.8%, net of -54 basis points of unrealised losses at
end-December 2022.
The phased-in leverage ratio
was 3.6% at end-December 2022, up +0.2 percentage point
compared to end-September 2022 and above the 3% requirement.
The phased-in Tier 1 ratio
stood at 13.0% and the phased-in total ratio was 17.5% this
quarter.
Crédit Agricole S.A.’s risk
weighted assets amounted to €361 billion at end-December
2022, down -€16 billion compared to 30 September 2022. The
business lines’ organic growth contributed to this change,
with the foreign exchange impact reducing RWA by -€4.9 billion
and business line growth excluding foreign exchange impact reducing
RWA by -€7.9 billion (see above). Mergers and
acquisitions freed up -€4.2 billion of risk-weighted
assets (see above) while insurance generated +€1.5
billion of additional RWA consumption for the equity-accounted
value including unrealised gains and/or losses.
Liquidity and Funding
Liquidity is measured at
Crédit Agricole Group level.
In order to provide simple, relevant and
auditable information on the Group’s liquidity position, the
banking cash balance sheet’s stable resources surplus is calculated
quarterly.
The banking cash balance sheet is derived from
Crédit Agricole Group’s IFRS financial statements. It is based on
the definition of a mapping table between the Group’s IFRS
financial statements and the sections of the cash balance sheet as
they appear in the next table and whose definition is commonly
accepted in the marketplace. It relates to the banking scope, with
insurance activities being managed in accordance with their own
specific prudential constraints.
Further to the breakdown of the IFRS financial
statements in the sections of the cash balance sheet, netting
calculations are carried out. They relate to certain assets and
liabilities that have a symmetrical impact in terms of liquidity
risk. Deferred taxes, fair value impacts, collective impairments,
short-selling transactions and other assets and liabilities were
netted for a total of €38 billion at end-December 2022. Similarly,
€94 billion in repos/reverse repos were eliminated insofar as these
outstandings reflect the activity of the securities desk carrying
out securities borrowing and lending operations that offset each
other. Other nettings calculated in order to build the cash balance
sheet – for an amount totalling €202 billion at end-December 2022 –
relate to derivatives, margin calls, adjustment/settlement/liaison
accounts and to non-liquid securities held by the Corporate and
Investment Banking business line (CIB). They are included in the
“Customer-related trading assets” section.
Note that deposits centralised with Caisse des
Dépôts et Consignations are not netted in order to build the cash
balance sheet; the amount of centralised deposits
(€81 billion at end-December 2022) is booked to assets
under “Customer-related trading assets” and to liabilities under
“Customer-related funds”.
In a final stage, other restatements reassign
outstandings that accounting standards allocate to one section,
when they are economically related to another. As such, senior
issuances placed through the banking networks as well as financing
by the European Investment Bank, the
Caisse des Dépôts et Consignations and other
refinancing transactions of the same type backed by customer loans,
which accounting standards would classify as “Medium long-term
market funds”, are reclassified as “Customer-related funds”.
Note that for Central Bank refinancing
operations, outstandings related to the T-LTRO (Targeted
Longer-Term Refinancing Operations) are included in “Long-term
market funds”. In fact, T-LTRO 3 transactions are similar to
long-term secured refinancing transactions, identical from a
liquidity risk standpoint to a secured issue.
Medium to long-term repos are also included in
“Long-term market funds”.
Finally, the CIB’s counterparties that are banks
with which we have a commercial relationship are considered as
customers in the construction of the cash balance sheet.
Standing at €1,667 billion at 31 December
2022, the Group’s banking cash balance sheet shows a
surplus of stable funding resources over stable application of
funds of €213 billion. It was down €53 billion
versus end-September 2022 and €66 billion versus end-December
2021. This was mainly due to the repayment of a significant portion
of T-LTRO 3 resources (€71 billion79), although this was offset by
strong growth in inflows. The Group’s commercial activity was very
dynamic during the quarter, with a +€12 billion increase in loans,
offset by a +€27 billion increase in customer-related funds.
In addition, total T-LTRO 3 outstandings for
Crédit Agricole Group amounted to €91 billion79 at
31 December 2022. This was a drop of €71 billion,79 which was the
sum repaid during the quarter. It should be noted that the interest
rate applicable to the refinancing rate of these operations is
accrued over the drawdown period until 23 November 2022, pursuant
to the ECB announcement dated 27 October 2022. The special interest
rate is accrued over the related special interest rate period.
Consequently, the special interest rate applicable to the
refinancing rate for these operations for the second period (June
2021 to June 2022) was taken into account in Q2 2022 for all
drawdowns.
It should be noted, with regard to the position
in available stable funding, that internal management excludes the
temporary surplus of stable resources provided by the increase in
T-LTRO 3 outstandings in order to secure the Medium-Term Plan’s
target of €110 billion to €130 billion, regardless of the
repayment strategy.
Furthermore, given the excess liquidity, the
Group remained in a short-term lending position at 31 December 2022
(central bank deposits exceeding the amount of short-term net
debt).
Medium-to-long-term market resources
were €284 billion at 31 December 2022, down
-€69 billion compared to end-September 2022, and down
-€60 billion compared to end-December 2021 due to the
repayment in December 2022 of €71 billion80 of T-LTRO 3
resources.
They included senior secured debt of
€154 billion, senior preferred debt of €77 billion,
senior non-preferred debt of €32 billion and Tier 2
securities amounting to €21 billion.
At 31 December 2022, the Group’s
liquidity reserves, at market value and after haircuts, amounted to
€467 billion, up +€5 billion from end-September
2022 and up +€2 billion from end-December 2021. They covered
short-term net debt more than three times over (excluding the
replacements with Central Banks).
They remain at a high level, the repayment of a
significant portion of T-LTRO 3 resources having had a minimal
impact overall but nevertheless leading to a change in the
structure of the liquidity reserves (decrease in Central Bank
deposits offset by the payment in full of eligible loans previously
used as collateral for T-LTRO 3 operations).
Crédit Agricole Group also continued its efforts
to maintain immediately available reserves (after recourse to ECB
financing). Central bank eligible non-HQLA assets after haircuts
amounted to €142 billion.
Credit institutions are subject to a threshold
for the LCR ratio, set at 100% on 1 January 2018.
Average year-on-year LCR ratios at 31
December 2022 were respectively 167.3% for
Crédit Agricole Group and 147.9% for
Crédit Agricole S.A. They were higher than the
Medium-Term Plan target (around 110%), in line with the Group’s
recourse to T-LTRO 3 drawdowns from the Central Bank during the
COVID-19 crisis.
In addition, the NSFR of
Crédit Agricole Group and Crédit Agricole S.A.
exceeded 100%, in accordance with the regulatory
requirement applicable since 28 June 2021 and above the Medium-Term
Plan target (>100%).
The Group continues to follow a prudent policy
as regards medium-to-long-term refinancing, with a very diversified
access to markets in terms of investor base and
products.
In 2022, the Group’s main issuers raised
the equivalent of €49.5 billion81,82
in medium-to-long-term debt through the open
market, 43% of it issued by Crédit Agricole S.A.
Significant events for the Group in 2022 were as follows:
-
Crédit Agricole CIB issued €17.5 billion, mainly
structured and highly diversified private placements;
-
Crédit Agricole Consumer Finance issued €7.6 billion in MLT
refinancing, including €1.6 billion in ABS
securitisations;
-
Crédit Agricole Italia issued a €1.5 billion covered bond in two
tranches (10 and 20 years);
-
Crédit Agricole Next Bank (Switzerland) issued three covered bonds
in 2022 for CHF300 million, including a green covered bond for
CHF100 million;
In addition, €10.1 billion81 was raised through
private agreements, comprising €7.8 billion from banking networks
(the Group’s retail banks or external networks), €1.6 billion from
supranational organisations and €0.7 billion from national
refinancing vehicles (including the credit institution CRH).
In 2022, Crédit Agricole S.A. raised the
equivalent of €21.1 billion81,82 through the open
market (initially planned at €13 billion).
The bank raised the equivalent of
€21.1 billion, of which €5.6 billion in senior
non-preferred debt, €0.3 billion in Tier 2 debt,
€8.1 billion in senior preferred debt and €7.0 billion in
senior secured debt. The financing comprised a variety of formats
and currencies.83
Note that on 5 January 2022,
Crédit Agricole S.A. issued a PerpNC7.7 AT1 bond for
USD1.25 billion at an initial rate of 4.75%.
The 2023 refinancing programme totals €19
billion81,82, consisting of €15 billion in senior preferred or
senior secured debt and €4 billion in TLAC eligible debt
(non-preferred senior debt or Tier 2 debt). At the end January
2023, 27% of the funding plan was realised.
Note that on 3 January 2023,
Crédit Agricole S.A. issued a PerpNC6 AT1 bond for €1.25
billion at an initial rate of 7.25%.
ECONOMIC AND FINANCIAL
ENVIRONMENT
2022 RETROSPECTIVE
The scenario developed at the end of 2021
assumed ban easing of both post-pandemic demand and supply
constraints. This scenario was based on twofold normalisation with
growth remaining sustained after a period of unusual vigorousness
and a moderation of inflation. In February 2022, the dramatic shock
of the Russia-Ukraine war broadsided this scenario through three
main channels: confidence, by causing concern; supply, by causing
actual or anticipated shortages; and demand, by stimulating
inflation. As during the Covid crisis, a hierarchy of national
vulnerabilities was established according to multiple criteria:
distance from the war zone; level of trade with the warring parties
(including dependence on grain, gas and oil imports and the energy
mix); terms-of-trade shock; and ability to mitigate price increases
(particularly by means of public subsidies). While countries have
been affected differently by this new shock, none have escaped the
acceleration and spread of inflation, leading to a more widespread
and premature monetary tightening and a downward revision of
growth. The only notable exception was China, which avoided
inflation.
After strong growth (8.1%) in 2021 supported by
exports that were boosted by Western stimulus packages and a highly
accommodative monetary policy, China has indeed
suffered a slowdown affecting all segments of its economy,
including the property sector, private consumption and foreign
trade. Anti-Covid restrictions disrupted industrial production and
consumption, but sluggish domestic demand kept inflation in check;
the global slowdown and rising commodity prices began to weigh on
growth and the trade balance; structural imbalances (property,
debt, demographics) exacerbated the situation’s adverse impact on
activity. Growth thus stood at 3%, far from the target of “around
5.5%” projected in March.
Although far from the centre of the conflict and
still buoyed by the post-Covid recovery momentum (5.9% growth in
2021) largely due to “over-stimulated” consumption, the
United States has seen a significant decline in
growth (2.1% in 2022). After beginning 2022 with two consecutive
quarters of GDP contraction84, growth recovered thanks to the
buffers resulting from the pandemic: the accumulation of abundant
savings (concentrated in high revenues) and a very tight labour
market. Strong job creation, coupled with a participation rate
(62.3% in December) that is still one percentage point below its
pre-pandemic level, has resulted in a decline in the unemployment
rate (3.5%) and vigorous wage increases (6.2% year-on-year in
November), partly offsetting the high inflation. Stimulated by
supply and then rapidly by demand, 12-month inflation fell from
7.5% in January 2022 to 6.5% in December after reaching its peak in
June at 9.1%. Core inflation dropped only slightly (5.7% in
December compared to 6% in January and a peak of 6.6% in
September).
Following very strong growth in 2021 (5.3%) and
after being buoyed in the first half of 2022 by the post-Omicron
upturn, from the summer onwards the Eurozone
suffered the brutal materialisation of a much more limited supply
of Russian gas, terms-of-trade shock85, an acceleration in
inflation and the tightening of financial terms. The slowdown was
abrupt: from 5.5% in the first quarter of 2022, the annual GDP
growth rate fell to 2.3% in the third quarter. Despite a slightly
negative external contribution (-0.3 percentage points), growth
nevertheless remained high over the year as a whole (3.5%) thanks
to dynamic domestic demand: household consumption and investment
grew by 4% and 4.3% respectively86. This robust consumption is
largely explained by the aftermath of the Covid crisis: a resilient
labour market paired with abundant savings.
Despite a slowdown in job creation and an
increase in the participation rate (to 74.9% in the third quarter),
“job retention”, a key element of the strategy rolled out during
Covid, has allowed the unemployment rate to continue to fall (to
6.5% in November 2022 compared to 7.1% one year earlier). While
public support (1.3% of the GDP in 2022, more than half of which in
favour of households) and the increase in nominal wages have not
made it possible to preserve real disposable income (down by 0.4%
over the first three quarters of the year), the loss of purchasing
power has not led to a decrease in consumption: the excess savings
built up during the crisis (of around €1000 billion in
mid-2022) have contributed to the resilience of domestic demand,
which should have been crippled by very high inflation. The
inflation rate more than doubled between January 2022 (5.1%
year-on-year) and its peak (10.6% in October) before decreasing
once again (9.2% in December): the deceleration of inflation in the
energy sector (25.5% compared to 34.9% in November) cushioned
accelerated price increases for other components (services,
non-energy industrial goods, food). While the recovery in core
inflation was initially caused by supply constraints (bottlenecks
and input shortages), the importance of demand factors gradually
increased as pandemic-related restrictions were lifted,
particularly in services. Additionally, sources of upstream
inflation have slowly spread. Core inflation thus rose from 2.3% in
January to 5.2% in December.
As inflation accelerated and spread,
with the risk of it becoming entrenched, the rhetoric and then the
actions of central banks hardened. The focus on fighting inflation
has resulted in aggressive monetary tightening.
In the United States, the
FOMC’s sudden hawkish reversal at the end of 2021 was particularly
reinforced in the first quarter of 2022. Fed Fund rate hikes came
into play from March onwards. These increases totalled
425 basis points over the year and brought the target range to
4.25%–4.50% by the end of the year. Quantitative Tightening (QT)
began in June (monthly reimbursement ceilings of $30 billion
in Treasuries and $17.5 billion in Mortgage-Backed Securities,
for a total of $47.5 billion, which was then doubled to a
monthly ceiling of $95 billion).
Finally, in December, the FOMC minutes shed
light on the intentions of Fed officials: a strong commitment to
returning inflation to its 2 percent objective; slowed rate
hike pace signalling neither a lesser determination to achieve the
price stability objective nor a judgement that inflation was
already on a persistent downward path; maintenance of a restrictive
policy “for a sustained period” (until inflation is clearly on a
path to the objective), stating that it would be inappropriate to
start cutting the Fed Funds rate in 2023.
In the Eurozone, after ten
years of uninterrupted monetary accommodation, the ECB started the
cycle of raising its key rates in July. Over the year, these rate
hikes amounted to 250 basis points, bringing the deposit and
refinancing rates to 2% and 2.50% respectively. The
“non-conventional” component was also tightened, with the end of
net purchases in March under the Pandemic Emergency Purchase
Programme (PEPP) and in July under the Asset Purchase Programme
(APP), and the tightening of liquidity conditions with the end of
TLTRO III operations in June.
In the financial markets, 2022
was a difficult year, marked by abrupt increases in interest rates
and declining equity markets.
US two-year rates rose by 380 basis points
(bps) to 4.50% while ten-year rates rose by 240 bps to 3.90%.
German two-year (2.70% at the end of December) and ten-year (2.55%)
sovereign rates rose by 330 bps and 275 bps respectively.
Sovereign rates (both two- and ten-year rates) have thus returned
to levels not seen since reaching their peak in 2007, at the dawn
of the 2008 financial crisis, which set them on the path of a major
downturn, accompanied by a curve flattening trend and ending with a
slight inversion in Germany and a sharp one in the United States.
At the end of 2021, the interest rate curves (spread between two-
and ten-year sovereign rates) were still on the rise, with a slope
of around 80 bps and 50 bps in the United States and
Germany respectively. Depending on the strength and maturity of
monetary tightening, the curves gradually flattened to invert in
the United States (in July) and in Germany (in November). The
compensation differences between long and short maturities were
negative at the end of December 2022 (by about 60 bps in the
United States and 15 bps in Germany). In addition, risk
premiums in France and Spain rose by about 20 bps to
55 bps and 97 bps, respectively, above the Bund, while
the Italian spread increased by almost 80 bps to
213 bps.
While the US equity market (S&P500) lost 20%
over the year, the Eurostoxx 50 and the CAC40 fell by 12% and
10% respectively. Finally, risk aversion and strong, premature
monetary tightening in the United States benefited the dollar. The
euro thus fell continuously against the dollar until September,
recording a depreciation of 14% over 9 months. Thanks to economic
growth being more resilient than expected and the ECB tightening,
the euro then recovered, limiting its depreciation against the
dollar to -6% over 2022.
2023 OUTLOOK
The scenario continues to be
overshadowed by the Russia-Ukraine war, with effects being felt
both in neighbouring countries and in those further away, through
the rise in
prices or the risk of
food or energy commodity shortages. The strong rebound of
post-Covid recovery is easing and
economies are poised to flirt with recession in varying degrees.
While violent recessions seem to be avoidable, this is
paradoxically due to the buffers resulting from the pandemic,
mainly in the form of still abundant private savings and fairly
resilient labour markets.
In the United States, the
pillars that have enabled strong growth (particularly consumption)
to go beyond expectations are gradually weakening: a tight labour
market but slowing net job creation; high nominal wage growth but a
loss of purchasing power, leading to the savings built-up during
the pandemic being drained and credit card borrowing; declining
business surveys; and slowdowns in non-residential and residential
investments. Counting on the counter-cyclical action of budgetary
and/or monetary policies is futile: the 2022 mid-term elections
produced a divided government that is not conducive to any fiscal
stimulus, and the Fed has made it clear that it is focusing on
inflation, at the cost of enduring a short-term recession.
Although it has passed its peak, headline
inflation is still high; core inflation appears to be resistant and
should slowly decelerate. The slowdown in growth and better
functioning supply chains should lead to a sharper decline in price
increases by the end of 2023, with headline inflation approaching
3% and core inflation falling below 3%. If inflation were to fall
faster than expected, a soft landing could not be ruled out. But
our central scenario favours a slight recession in the middle of
the year, leading to a pronounced slowdown in growth in 2023 (to
0.6%).
In China, the shift from its
zero-Covid policy quickly pleased observers. The need to “live with
the virus” should nevertheless continue to weigh on growth, whose
expected upturn will depend essentially on domestic demand. The
latter will itself be conditioned by three factors: the extent of
the support granted by the authorities to the property sector
(limited support because the Chinese government does not want to
position itself as a last-resort lender to a sector that it
considers responsible for its over-indebtedness); the capacity of
the government to create sufficient confidence in order to free up
part of its residents’ precautionary savings and to stimulate
consumption; and the attitude of the government towards the private
sector, which has suffered over the last two years from the
zero-Covid strategy and the tightening of regulations. Taking into
account the slightly negative – or at best, zero – contribution
from foreign trade, and investments still being curbed by the
restructuring of the property sector, growth should accelerate to
around 5%, mainly due to positive base effects in the service
sectors.
In the Eurozone, the natural
slowdown in post-pandemic growth has been compounded by the lasting
shock of the war in Ukraine. It is difficult to read the economic
situation due to the succession of shocks, mainly the Covid crisis
and the war in Ukraine. What are the ongoing effects of the
pandemic? A labour market that is still solid, a substantial but
largely depleted savings surplus for the most modest households,
inflation that was hoped to be temporary. While the debate on the
precise nature of inflation and the respective responsibilities of
supply and demand has not been settled, it is clear that supply
chain tensions are decreasing, the slowdown in global inflation is
spreading, but also that second-round effects are visible: the
impact of energy price rises on consumer prices, via production
costs, is obvious even before any wage-price spiral is implicated.
What is the impact from the war in Ukraine? A sustained increase in
the price of energy imports. The effects of deteriorating trade
terms, inflation and loss of competitiveness on export volumes and
market shares will gradually reveal themselves.
Our scenario for the Eurozone assumes a decline
in average inflation (HICP definition) (projected at 7.5%), but it
would still remain high (4.5% at the end of 2023) and weigh on
domestic demand. While net exports would subtract from growth
(negative contribution of 0.7 percentage points), domestic
demand and inventories would still make slightly positive
contributions (of 0.6 and 0.2 percentage points
respectively). Our scenario thus assumes, overall, a marked
deceleration in growth in 2023 (to 0.1% after 3.4% in 2022) but
also, beyond that, a permanently weaker rate of expansion. This
scenario is still based on strong assumptions about gas supply and
its price. While the prospect of winter power cuts seems further
and further away thanks to favourable weather and the restarting of
nuclear power plants, the difficulties in obtaining natural gas at
a “non-punitive” cost are likely to last as long as the war in
Ukraine and beyond.
In France, even if partially
cushioned by the price shield, the effects of inflation on
customers’ income should result in a slowdown in demand in the
first half of 2023; a brief contraction in GDP is also not
excluded. Coupled with aggressive monetary tightening that will
eventually limit investment at a time when most companies are
already experiencing pressure on their margins, economic activity
would only recover slowly in the second half of the year, with some
industrial sectors remaining crippled by high energy prices over
the longer term. In 2023, with household consumption rising by
0.2%, total investment stable, and a negative net external
contribution, average growth would reach 0.3%. This scenario
assumes a slightly less dynamic labour market: job creation should
slow and defaults should return to their pre-crisis levels. A
moderate increase in the unemployment rate (to 7.5%) and wage
growth falling once again below price developments would therefore
weigh on consumption. Inflation would peak at the beginning of
2023, but would only slowly decline throughout the year (consumer
prices, INSEE definition: 5.2% on average, 3.7% at year-end). With
inflation remaining high, households would then have to dip into
their savings to maintain their essential expenses: the savings
rate would fall before gradually returning to 15%, close to its
pre-pandemic average.
In terms of monetary policy, fighting
inflation remains the priority. Central banks will not risk letting
their guard down too quickly, and the pivot that the markets are
hoping for will be more of a pause than a prelude to a rapid
decline.
In the United States, after
aggressive rate hikes in 2022 totalling 425 basis points,
bringing the target range to 4.25%–4.50%, the Fed signalled its
intention to slow the pace of these increases while making it clear
that the tightening was not at an end. Our monetary scenario
assumes a slowdown in the pace of rate hikes (25 basis points
at each of the February, March and May FOMC meetings), bringing the
target range for the Fed funds rate to a peak of 5%–5.25%, in line
with the December dot plot. Based on its experience, the Fed should
remain cautious and not engage in too much premature easing: its
rates would remain on this plateau for the rest of 2023. Since
inflation’s sustainable return to the 2% target is a prerequisite
for easing, this would not take place before 2024. Additionally,
after having reached its maximum pace in September, the Fed’s
balance sheet will continue to shrink as announced in May.
Quantitative tightening (QT) should come to an end when easing
takes place through key rate cuts, so that the two monetary tools
do not work against each other. The end of the QT would therefore
not occur in 2023.
In the Eurozone, at its meeting
at the end of December, the ECB revised its inflation forecasts
upwards (6.3% in 2023, 3.4% in 2024, 2.3% in 2025) and growth
forecasts downwards (0.5% in 2023, 1.9% in 2024 and 2025). In line
with higher inflation, the ECB raised rates by 50 basis points
to bring the deposit rate to 2%, and coupled this move with a very
proactive rhetoric: interest rates will have to continue to rise
significantly at a steady pace in order to reach sufficiently
restrictive levels and ensure inflation’s rapid return to the 2%
objective in the medium term. In our scenario, the ECB would
continue to raise its key rates until June 2023, when the
refinancing and deposit rates would reach 4.25% and 3.75%
respectively, levels at which they would remain for a fairly long
time, since monetary easing would not take place before mid-2024.
This scenario is aggressive, but a change of course from the ECB’s
announcements would require a significant improvement in the
inflation outlook, a drastic deterioration in growth or extreme
tensions on financial markets: none of these factors seem to be
looming.
In December, the ECB also unveiled some elements
of its QT, announcing a cautious, gradual strategy to reduce its
balance sheet by €15 billion between March and June by
reducing the securities held under the Public Sector Purchase
Programme (PSPP). Details of further QT developments will be
provided in February. Our scenario assumes a decrease of
€20 billion per month from the third quarter, concentrated in
government securities (PSPP). Finally, tightening through rates and
quantities is accompanied by a change in the terms of the TLTROs
(Targeted Long-term Refinancing Operations), encouraging banks to
repay these loans early: given the importance of bank credit in the
Eurozone, this channel could prove to be the most powerful in terms
of monetary tightening.
Under the influence of monetary
tightening and inflation that remains high, long-term interest
rates should continue to rise slightly before declining once again
towards mid-2023, weighed down by the slowdown or even a likely
recession. This scenario maintains the inversion of the interest
rate curves (2 years–10 years): sharp in the US, moderate in
Germany.
The ten-year US Treasuries rate would peak at
around 4.15% in the first half of 2023 and the two-year–ten-year
slope would reach its maximum inversion (105 basis points) in
the first quarter of 2023. Our scenario assumes the US 10-year rate
will be very slightly above 4% at the end of 2023. In the Eurozone,
expectations of a restrictive ECB policy should weigh on growth
prospects and support demand for risk-free long-term securities:
government bonds, which have not been popular with individual
investors and the private sector over the past decade due to low
returns, would regain favour with these investors. The ECB’s policy
would therefore only lead to a limited increase in long-term
interest rates. On the other hand, TLTRO redemptions could, in the
short term, ease the shortage of securities and create modest
pressure to widen spreads on peripherals. Our scenario assumes a
Bund rate (German 10-year rate) of 2.60% at the end of 2023, and
French and Italian risk premiums close to 60 and
220 basis points, respectively, compared to the Bund.
After being supported by risk aversion,
over-stimulated growth and premature, powerful monetary tightening
in the United States, the factors behind the US dollar’s sustained
appreciation are gradually dissipating. The US currency is
expected to lose some ground in 2023. Our scenario assumes a
EUR/USD exchange rate of 1.10 at the end of 2023.
Appendix 1 – Specific items, Crédit Agricole Group and
Crédit Agricole S.A.
Crédit Agricole
Group – Specific items, Q4-22 and 12M-22
|
|
|
Q4-22 |
Q4-21 |
|
2022 |
2021 |
|
€m |
|
Gross impact* |
Impact on Net
income |
Gross impact* |
Impact on Net
income |
|
Gross impact* |
Impact on Net
income |
Gross impact* |
Impact on Net
income |
| |
|
|
|
|
|
|
|
|
|
|
|
DVA (LC) |
|
(24) |
(18) |
1 |
1 |
|
(19) |
(14) |
6 |
4 |
|
Loan portfolio hedges (LC) |
|
(38) |
(28) |
4 |
3 |
|
21 |
16 |
(17) |
(13) |
|
Home Purchase Savings Plans (LCL) |
|
- |
- |
9 |
7 |
|
34 |
26 |
(1) |
(1) |
|
Home Purchase Savings Plans (CC) |
|
- |
- |
22 |
16 |
|
53 |
39 |
22 |
16 |
|
Home Purchase Savings Plans (RB) |
|
- |
- |
85 |
60 |
|
412 |
306 |
85 |
61 |
|
Reclassification of held-for-sale operations - NBI (IRB) |
|
- |
- |
- |
- |
|
0 |
0 |
(2) |
(2) |
|
Exceptional provisionning on moratoria Poland (IRB) |
|
- |
- |
- |
- |
|
(21) |
(17) |
- |
- |
|
Ongoing sale project NBI (WM) |
|
- |
- |
- |
- |
|
- |
- |
(1) |
(1) |
| Total
impact on revenues |
|
(63) |
(46) |
120 |
86 |
|
480 |
355 |
92 |
65 |
|
Creval integration costs (IRB) |
|
- |
- |
- |
- |
|
(30) |
(18) |
- |
- |
|
Lyxor integration costs (AG) |
|
- |
- |
- |
- |
|
(59) |
(31) |
- |
- |
|
CAGIP Transformation costs (CC) |
|
(20) |
(15) |
- |
- |
|
(20) |
(15) |
- |
- |
|
CAGIP Transformation costs (RB) |
|
(30) |
(22) |
- |
- |
|
(29.5) |
(21.9) |
- |
- |
|
S3 / Kas Bank integration costs (LC) |
|
- |
- |
- |
- |
|
- |
- |
(4) |
(2) |
|
Transformation costs (LC) |
|
- |
- |
(24) |
(12) |
|
- |
- |
(45) |
(23) |
|
Transformation costs (FRB) |
|
- |
- |
- |
- |
|
- |
- |
(13) |
(9) |
|
Lyxor aquisition costs (AG) |
|
- |
- |
(16) |
(8) |
|
- |
- |
(16) |
(8) |
|
Voluntary redundancy plan CA Italia |
|
- |
- |
(190) |
(109) |
|
- |
- |
(190) |
(109) |
|
Ongoing sale project Expenses (WM) |
|
- |
- |
- |
- |
|
- |
- |
(2) |
(2) |
|
Creval integrations costs (IRB) |
|
- |
- |
(23) |
(13) |
|
- |
- |
(32) |
(17) |
|
Donation for illiteracy (RB) |
|
(35) |
(26) |
- |
- |
|
(35) |
(26) |
- |
- |
|
Exceptional contribution to the Italian banks rescue plan
(IRB) |
|
- |
- |
(25) |
(14) |
|
- |
- |
(25) |
(14) |
|
Reclassification of held-for-sale operations - Costs (IRB) |
|
- |
- |
- |
- |
|
(0) |
(0) |
(1) |
(1) |
| Total
impact on operating expenses |
|
(84) |
(63) |
(297) |
(168) |
|
(174) |
(111) |
(347) |
(197) |
|
Restatement SRF 2016-2020 (CR) |
|
- |
- |
- |
- |
|
- |
- |
55 |
55 |
|
Restatement SRF 2016-2020 (CC) |
|
- |
- |
- |
- |
|
- |
- |
130 |
130 |
| Total
impact on SRF |
|
- |
- |
- |
- |
|
- |
- |
185 |
185 |
| |
|
|
|
|
|
|
|
|
|
|
|
Disposal in receivables and additional provisioning of the
portfolio CA Italia |
|
- |
- |
(319) |
(180) |
|
- |
- |
(319) |
(180) |
|
Creval - Cost of Risk stage 1 (IRB) |
|
- |
- |
- |
- |
|
- |
- |
(25) |
(21) |
|
Provision for own equity risk Ukraine (IRB) |
|
- |
- |
- |
- |
|
(195) |
(195) |
- |
- |
| |
|
|
|
|
|
|
|
|
|
|
| Total
impact on cost of credit risk |
|
- |
- |
(319) |
(180) |
|
(195) |
(195) |
(344) |
(202) |
|
CACF/Stellantis transformation costs (SFS) |
|
(8) |
(16) |
- |
- |
|
(8) |
(16) |
- |
- |
|
"Affrancamento" gain (SFS) |
|
- |
- |
- |
- |
|
- |
- |
5 |
5 |
| Total
impact equity-accounted entities |
|
(8) |
(16) |
- |
- |
|
(8) |
(16) |
5 |
5 |
|
Creval integrations costs (IRB) |
|
- |
|
- |
|
|
- |
|
1 |
|
|
Creval acquisition costs (IRB) |
|
- |
- |
- |
- |
|
- |
- |
(16) |
(9) |
| Total
impact on Net income on other assets |
|
- |
- |
- |
- |
|
- |
- |
(15) |
(9) |
|
Badwill Creval (IRB) |
|
- |
- |
119 |
101 |
|
- |
- |
497 |
422 |
| Total
impact on change of value of goodwill |
|
- |
- |
119 |
101 |
|
- |
- |
497 |
422 |
|
"Affrancamento" gain (IRB) |
|
- |
- |
59 |
50 |
|
- |
- |
97 |
82 |
|
"Affrancamento / reallineamento" gain (IRB) |
|
146 |
126 |
- |
- |
|
146 |
126 |
- |
- |
|
"Affrancamento" gain (AG) |
|
- |
- |
- |
- |
|
- |
- |
114 |
80 |
| Total
impact on tax |
|
146 |
126 |
272 |
205 |
|
146 |
126 |
424 |
317 |
|
Capital gain La Médicale (GEA) |
|
- |
- |
- |
- |
|
101 |
101 |
- |
- |
|
Reclassification of held-for-sale operations Crédit du Maroc
(IRB) |
|
(14) |
(14) |
- |
- |
|
- 14 |
(14) |
- |
- |
|
Reclassification of held-for-sale operations (IRB) |
|
- |
- |
- |
- |
|
- 7 |
(10) |
(1) |
(1) |
|
Ongoing sale project (WM) |
|
- |
- |
- |
- |
|
- |
- |
5 |
5 |
| Total
impact on Net income from discounted or held-for-sale
operations |
|
(14) |
(14) |
- |
- |
|
80 |
77 |
3 |
3 |
|
Total impact of specific items |
|
(23) |
(13) |
(104) |
44 |
|
330 |
236 |
500 |
589 |
|
Asset gathering |
|
- |
- |
(16) |
(8) |
|
42 |
70 |
100 |
74 |
|
French Retail
banking |
|
(64) |
(48) |
94 |
67 |
|
382 |
283 |
126 |
106 |
|
International Retail
banking |
|
132 |
112 |
(292) |
(88) |
|
(121) |
(128) |
71 |
226 |
|
Specialised financial
services |
|
(8) |
(16) |
108 |
66 |
|
(8) |
(16) |
113 |
71 |
|
Large customers |
|
(63) |
(46) |
(19) |
(8) |
|
2 |
1 |
(61) |
(33) |
|
Corporate centre |
|
(20) |
(15) |
22 |
16 |
|
32 |
24 |
152 |
146 |
* Impact before tax and before minority interests
Crédit
Agricole SA – Specific items, Q4-22 and 12M-22
|
|
|
Q4-22 |
Q4-21 |
|
2022 |
2021 |
|
€m |
|
Gross impact* |
Impact on Net
income |
Gross impact* |
Impact on Net
income |
|
Gross impact* |
Impact on Net
income |
Gross impact* |
Impact on Net
income |
| |
|
|
|
|
|
|
|
|
|
|
|
DVA (LC) |
|
(24) |
(18) |
1 |
1 |
|
(19) |
(14) |
6 |
4 |
|
Loan portfolio hedges (LC) |
|
(38) |
(28) |
4 |
3 |
|
21 |
15 |
(17) |
(12) |
|
Home Purchase Savings Plans (FRB) |
|
- |
- |
9 |
6 |
|
34 |
24 |
(1) |
(1) |
|
Home Purchase Savings Plans (CC) |
|
- |
- |
22 |
16 |
|
53 |
39 |
22 |
16 |
|
Reclassification of held-for-sale operations - NBI (IRB) |
|
- |
- |
- |
- |
|
0 |
0 |
(2) |
(2) |
|
Exceptional provisionning on moratoria Poland (IRB) |
|
- |
- |
- |
- |
|
(21) |
(17) |
- |
- |
|
Ongoing sale project NBI (WM) |
|
- |
- |
- |
- |
|
- |
- |
(1) |
(1) |
| Total
impact on revenues |
|
(63) |
(45) |
36 |
25 |
|
68 |
48 |
7 |
4 |
|
CAGIP Transformation costs (CC) |
|
(20) |
(13) |
- |
- |
|
(20) |
(13) |
- |
- |
|
Ongoing sale project Expenses (WM) |
|
- |
- |
- |
- |
|
- |
- |
(2) |
(2) |
|
S3 / Kas Bank integration costs (LC) |
|
- |
- |
- |
- |
|
- |
- |
(4) |
(2) |
|
Transformation costs (LC) |
|
- |
- |
(24) |
(12) |
|
- |
- |
(45) |
(23) |
|
Transformation costs (FRB) |
|
- |
- |
- |
- |
|
- |
- |
(13) |
(9) |
|
Creval integration costs (IRB) |
|
- |
- |
(23) |
(12) |
|
- |
- |
(32) |
(15) |
|
Voluntary redundancy plan CA Italia |
|
- |
- |
(190) |
(97) |
|
- |
- |
(190) |
(97) |
|
Creval other adjustments |
|
- |
- |
(19) |
(11) |
|
- |
- |
(19) |
(11) |
|
Creval integration costs (IRB) |
|
- |
- |
- |
- |
|
(30) |
(16) |
- |
- |
|
Reclassification of held-for-sale operations - Costs (IRB) |
|
- |
- |
- |
- |
|
(0) |
(0) |
(0) |
(0) |
|
Lyxor aquisition costs (AG) |
|
- |
- |
(16) |
(8) |
|
- |
- |
(16) |
(8) |
|
Lyxor integration costs (AG) |
|
- |
- |
- |
- |
|
(59) |
(30) |
- |
- |
|
Exceptional contribution on supplementary health insurance premiums
(AG) |
|
- |
- |
(25) |
(13) |
|
- |
- |
(25) |
(13) |
| Total
impact on operating expenses |
|
(20) |
(13) |
(297) |
(152) |
|
(110) |
(60) |
(347) |
(180) |
|
Restatement SRF2016-2020 |
|
- |
- |
- |
- |
|
- |
- |
130 |
130 |
| Total
impact on SRF |
|
- |
- |
- |
- |
|
- |
- |
130 |
130 |
|
Creval - Cost of Risk stage 1 (IRB) |
|
- |
- |
- |
- |
|
- |
- |
(25) |
(19) |
|
Disposal in receivables and additional provisioning of the
portfolio |
|
- |
- |
(319) |
(161) |
|
- |
- |
(319) |
(161) |
|
Provision for own equity risk Ukraine (IRB) |
|
- |
- |
- |
- |
|
(195) |
(195) |
- |
- |
| Total
impact on cost of credit risk |
|
- |
- |
(319) |
(161) |
|
(195) |
(195) |
(344) |
(180) |
|
CACF/Stellantis transformation costs (SFS) |
|
(8) |
(16) |
- |
- |
|
(8) |
(16) |
- |
- |
|
"Affrancamento" gain (SFS) |
|
- |
- |
- |
- |
|
- |
- |
5 |
5 |
| Total
impact equity-accounted entities |
|
(8) |
(16) |
- |
- |
|
(8) |
(16) |
5 |
5 |
|
Creval acquisition costs (IRB) |
|
- |
- |
- |
- |
|
- |
- |
(16) |
(8) |
| Total
impact Gains ou pertes sur autres actifs |
|
- |
- |
- |
- |
|
- |
- |
(15) |
(8) |
|
Badwill Creval (IRB) |
|
- |
- |
119 |
90 |
|
- |
- |
497 |
376 |
| Total
impact on change of value of goodwill |
|
- |
- |
119 |
90 |
|
- |
- |
497 |
376 |
|
"Affrancamento" gain Tax (SFS) |
|
- |
- |
108 |
66 |
|
- |
- |
108 |
66 |
|
"Affrancamento" gain (IRB) |
|
- |
- |
59 |
45 |
|
- |
- |
97 |
73 |
|
"Affrancamento / reallineamento" gain (IRB) |
|
146 |
114 |
- |
- |
|
146 |
114 |
- |
- |
|
"Affrancamento" gain (AG) |
|
- |
- |
- |
- |
|
- |
- |
114 |
78 |
|
Off-balance sheet DTA |
|
- |
- |
105 |
80 |
|
- |
- |
105 |
80 |
| Total
impact on tax |
|
146 |
114 |
272 |
190 |
|
146 |
114 |
424 |
296 |
|
Reclassification of held-for-sale operations (IRB) |
|
- |
- |
- |
- |
|
(7) |
(10) |
(1) |
(1) |
|
Capital gain La Médicale (GEA) |
|
- |
- |
- |
- |
|
101 |
101 |
- |
- |
|
Reclassification of held-for-sale operations Crédit du Maroc
(IRB) |
|
(14) |
(14) |
- |
- |
|
(14) |
(14) |
- |
- |
|
Ongoing sale project (WM) |
|
- |
- |
- |
- |
|
- |
- |
5 |
5 |
| Total
impact on Net income from discounted or held-for-sale
operations |
|
(14) |
(14) |
- |
- |
|
80 |
77 |
3 |
3 |
|
Total impact of specific items |
|
41 |
25 |
(189) |
(7) |
|
(18) |
(32) |
361 |
447 |
|
Asset gathering |
|
- |
- |
(16) |
(8) |
|
42 |
71 |
100 |
72 |
|
French Retail
banking |
|
- |
- |
9 |
6 |
|
34 |
24 |
(14) |
(10) |
|
International Retail
banking |
|
132 |
100 |
(292) |
(78) |
|
(121) |
(138) |
71 |
200 |
|
Specialised financial
services |
|
(8.13) |
(16) |
108 |
66 |
|
(8) |
(16) |
113 |
71 |
|
Large customers |
|
(63) |
(45) |
(19) |
(8) |
|
2 |
1 |
(61) |
(33) |
|
Corporate centre |
|
(20) |
(13) |
22 |
16 |
|
32 |
26 |
152 |
146 |
* Impact before tax and before minority
interests
Appendix 2 – Credit Agricole Group: results by business
lines
Crédit Agricole Group – Results by business line, Q4-22 and
Q4-21
|
|
Q4-22
(stated) |
|
€m |
RB |
LCL |
IRB |
AG |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
3,428 |
915 |
916 |
1,940 |
710 |
1,712 |
(187) |
9,434 |
|
Operating expenses excl. SRF |
(2,530) |
(581) |
(610) |
(796) |
(359) |
(1,000) |
(288) |
(6,164) |
|
SRF |
- |
- |
- |
- |
- |
- |
- |
- |
|
Gross operating income |
898 |
334 |
306 |
1,144 |
351 |
712 |
(475) |
3,270 |
|
Cost of risk |
(307) |
(78) |
(190) |
(11) |
(145) |
(15) |
(7) |
(753) |
|
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
- |
|
Equity-accounted entities |
0 |
- |
1 |
24 |
68 |
4 |
(0) |
97 |
|
Net income on other assets |
(1) |
3 |
1 |
(4) |
(2) |
(9) |
(1) |
(13) |
|
Income before
tax |
590 |
259 |
118 |
1,152 |
271 |
693 |
(483) |
2,600 |
|
Tax |
(128) |
(51) |
106 |
(333) |
(61) |
(156) |
278 |
(344) |
|
Net income from discont'd or held-for-sale ope. |
(0) |
- |
(28) |
3 |
(3) |
1 |
0 |
(27) |
|
Net income |
462 |
208 |
196 |
823 |
207 |
537 |
(205) |
2,229 |
|
Non controlling interests |
(0) |
(0) |
(28) |
(112) |
(26) |
(28) |
4 |
(189) |
|
Net income Group
Share |
462 |
208 |
168 |
711 |
182 |
510 |
(201) |
2,040 |
|
|
Q4-21
(stated) |
|
€m |
RB |
LCL |
AG |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
3,680 |
939 |
1,608 |
842 |
686 |
1,565 |
181 |
9,500 |
|
Operating expenses excl. SRF |
(2,337) |
(603) |
(733) |
(867) |
(347) |
(975) |
(246) |
(6,109) |
|
SRF |
- |
- |
- |
- |
- |
- |
- |
- |
|
Gross operating income |
1,343 |
336 |
875 |
(25) |
338 |
590 |
(65) |
3,391 |
|
Cost of risk |
(130) |
(54) |
1 |
(455) |
(136) |
(1) |
(8) |
(783) |
|
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
- |
|
Equity-accounted entities |
1 |
- |
21 |
2 |
67 |
2 |
- |
92 |
|
Net income on other assets |
22 |
4 |
0 |
(0) |
(14) |
0 |
(3) |
10 |
|
Income before
tax |
1,235 |
285 |
898 |
(359) |
256 |
591 |
(76) |
2,829 |
|
Tax |
(292) |
(70) |
(175) |
330 |
57 |
(157) |
37 |
(269) |
|
Net income from discont'd or held-for-sale ope. |
- |
- |
(0) |
4 |
- |
- |
(0) |
4 |
|
Net income |
943 |
215 |
723 |
(25) |
313 |
434 |
(39) |
2,564 |
|
Non controlling interests |
(0) |
(0) |
(116) |
(1) |
(75) |
(18) |
0 |
(210) |
|
Net income Group
Share |
943 |
215 |
607 |
(26) |
238 |
416 |
(39) |
2,354 |
Crédit Agricole Group – Results by business line, 2022 and
2021
|
|
2022
(stated) |
|
€m |
RB |
LCL |
IRB |
AG |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
14,188 |
3,851 |
3,373 |
6,902 |
2,782 |
7,012 |
55 |
38,162 |
|
Operating expenses excl. SRF |
(9,441) |
(2,321) |
(2,131) |
(3,322) |
(1,443) |
(3,905) |
(1,088) |
(23,650) |
|
SRF |
(156) |
(69) |
(38) |
(7) |
(34) |
(442) |
(56) |
(803) |
|
Gross operating income |
4,591 |
1,462 |
1,204 |
3,573 |
1,304 |
2,665 |
(1,090) |
13,709 |
|
Cost of risk |
(1,136) |
(237) |
(701) |
(17) |
(533) |
(251) |
(18) |
(2,893) |
|
Equity-accounted entities |
5 |
- |
2 |
88 |
308 |
15 |
- |
419 |
|
Net income on other assets |
24 |
8 |
7 |
(2) |
2 |
(8) |
(2) |
28 |
|
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
- |
|
Income before
tax |
3,483 |
1,232 |
513 |
3,642 |
1,081 |
2,421 |
(1,109) |
11,264 |
|
Tax |
(853) |
(300) |
(67) |
(830) |
(222) |
(592) |
356 |
(2,508) |
|
Net income from discontinued or held-for-sale operations |
(0) |
- |
(7) |
123 |
0 |
- |
0 |
116 |
|
Net income |
2,630 |
932 |
439 |
2,935 |
860 |
1,830 |
(753) |
8,873 |
|
Non controlling interests |
(1) |
(0) |
(113) |
(422) |
(109) |
(91) |
6 |
(729) |
|
Net income Group
Share |
2,630 |
932 |
327 |
2,513 |
751 |
1,739 |
(747) |
8,144 |
|
|
2021
(stated) |
|
€m |
RB |
LCL |
AG |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
14,096 |
3,696 |
6,528 |
3,180 |
2,692 |
6,318 |
312 |
36,822 |
|
Operating expenses excl. SRF |
(8,986) |
(2,312) |
(3,005) |
(2,299) |
(1,379) |
(3,707) |
(913) |
(22,602) |
|
SRF |
(87) |
(59) |
(7) |
(33) |
(23) |
(328) |
58 |
(479) |
|
Gross operating income |
5,023 |
1,325 |
3,516 |
848 |
1,290 |
2,283 |
(543) |
13,741 |
|
Cost of risk |
(606) |
(222) |
(18) |
(786) |
(505) |
(39) |
(18) |
(2,193) |
|
Equity-accounted entities |
(11) |
- |
84 |
3 |
307 |
8 |
- |
392 |
|
Net income on other assets |
28 |
6 |
(0) |
(13) |
(8) |
(39) |
0 |
(27) |
|
Change in value of goodwill |
- |
- |
- |
497 |
- |
0 |
- |
497 |
|
Income before
tax |
4,434 |
1,109 |
3,582 |
549 |
1,084 |
2,212 |
(561) |
12,409 |
|
Tax |
(1,249) |
(309) |
(643) |
198 |
(120) |
(512) |
172 |
(2,463) |
|
Net income from discontinued or held-for-sale operations |
- |
- |
5 |
1 |
- |
- |
(0) |
6 |
|
Net income |
3,185 |
800 |
2,944 |
748 |
964 |
1,700 |
(389) |
9,953 |
|
Non controlling interests |
(1) |
(0) |
(501) |
(132) |
(157) |
(57) |
(4) |
(852) |
|
Net income Group
Share |
3,184 |
800 |
2,443 |
617 |
808 |
1,643 |
(393) |
9,101 |
Appendix 3 –
Crédit Agricole S.A.:
results by business line
Crédit Agricole S.A. – Results by business line, Q4-22 and
Q4-21
|
|
Q4-22
(stated) |
|
€m |
AG |
LC |
SFS |
FRB (LCL) |
IRB |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
Revenues |
1,937 |
1,712 |
710 |
915 |
896 |
(201) |
5,969 |
|
Operating expenses excl. SRF |
(796) |
(1,000) |
(359) |
(581) |
(593) |
(232) |
(3,561) |
|
SRF |
- |
- |
- |
- |
- |
- |
- |
|
Gross operating income |
1,142 |
712 |
351 |
334 |
303 |
(433) |
2,408 |
|
Cost of risk |
(11) |
(15) |
(145) |
(78) |
(189) |
(4) |
(443) |
|
Equity-accounted entities |
24 |
4 |
68 |
- |
1 |
(16) |
80 |
|
Net income on other assets |
(4) |
(9) |
(2) |
3 |
1 |
0 |
(10) |
|
Income before
tax |
1,150 |
693 |
271 |
259 |
115 |
(453) |
2,035 |
|
Tax |
(332) |
(156) |
(61) |
(51) |
106 |
269 |
(224) |
|
Net income from discontinued or held-for-sale operations |
3 |
1 |
(3) |
- |
(28) |
0 |
(27) |
|
Net income |
821 |
537 |
207 |
208 |
194 |
(184) |
1,784 |
|
Non controlling interests |
(117) |
(38) |
(26) |
(9) |
(44) |
6 |
(228) |
|
Net income Group
Share |
705 |
499 |
182 |
199 |
150 |
(177) |
1,557 |
|
|
Q4-21
(stated) |
|
€m |
AG |
LC |
SFS |
FRB (LCL) |
IRB |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
Revenues |
1,608 |
1,566 |
690 |
939 |
824 |
187 |
5,815 |
|
Operating expenses excl. SRF |
(733) |
(975) |
(352) |
(603) |
(851) |
(207) |
(3,720) |
|
SRF |
- |
- |
- |
- |
- |
- |
- |
|
Gross operating income |
876 |
591 |
338 |
336 |
(26) |
(19) |
2,094 |
|
Cost of risk |
1 |
(1) |
(136) |
(54) |
(451) |
(6) |
(647) |
|
Equity-accounted entities |
21 |
2 |
67 |
- |
2 |
(10) |
82 |
|
Net income on other assets |
0 |
0 |
(14) |
4 |
(0) |
(0) |
(9) |
|
Income before
tax |
898 |
592 |
256 |
285 |
(356) |
(36) |
1,640 |
|
Tax |
(175) |
(157) |
57 |
(70) |
330 |
24 |
9 |
|
Net income from discontinued or held-for-sale operations |
(1) |
- |
- |
- |
4 |
- |
4 |
|
Net income |
723 |
435 |
313 |
215 |
(23) |
(12) |
1,652 |
|
Non controlling interests |
(122) |
(25) |
(75) |
(10) |
6 |
1 |
(224) |
|
Net income Group
Share |
602 |
410 |
238 |
205 |
(16) |
(11) |
1,428 |
Crédit Agricole S.A. – Results by business line, 2022 and
2021
|
|
2022
(stated) |
|
€m |
AG |
LC |
SFS |
FRB (LCL) |
IRB |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
Revenues |
6,885 |
7,013 |
2,782 |
3,851 |
3,299 |
(28) |
23,801 |
|
Operating expenses excl. SRF |
(3,322) |
(3,905) |
(1,443) |
(2,321) |
(2,067) |
(876) |
(13,932) |
|
SRF |
(7) |
(442) |
(34) |
(69) |
(38) |
(56) |
(647) |
|
Gross operating income |
3,556 |
2,666 |
1,304 |
1,462 |
1,194 |
(960) |
9,222 |
|
Cost of risk |
(17) |
(251) |
(533) |
(237) |
(700) |
(9) |
(1,746) |
|
Equity-accounted entities |
88 |
15 |
308 |
- |
2 |
(43) |
371 |
|
Net income on other assets |
(2) |
(8) |
2 |
17 |
7 |
0 |
15 |
|
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
|
Income before
tax |
3,625 |
2,423 |
1,081 |
1,242 |
504 |
(1,013) |
7,862 |
|
Tax |
(825) |
(592) |
(222) |
(300) |
(66) |
343 |
(1,662) |
|
Net income from discontinued or held-for-sale operations |
123 |
- |
0 |
- |
(7) |
0 |
116 |
|
Net income |
2,923 |
1,831 |
860 |
941 |
432 |
(670) |
6,316 |
|
Non controlling interests |
(436) |
(120) |
(109) |
(42) |
(159) |
(13) |
(880) |
|
Net income Group
Share |
2,486 |
1,711 |
751 |
899 |
273 |
(682) |
5,437 |
|
|
2021
(stated) |
|
€m |
AG |
LC |
SFS |
FRB (LCL) |
IRB |
CC |
Total |
|
|
|
|
|
|
|
|
|
|
Revenues |
6,527 |
6,319 |
2,697 |
3,696 |
3,113 |
306 |
22,657 |
|
Operating expenses excl. SRF |
(3,005) |
(3,707) |
(1,383) |
(2,312) |
(2,242) |
(779) |
(13,429) |
|
SRF |
(7) |
(328) |
(23) |
(59) |
(33) |
58 |
(392) |
|
Gross operating income |
3,515 |
2,284 |
1,290 |
1,325 |
838 |
(415) |
8,836 |
|
Cost of risk |
(18) |
(39) |
(505) |
(222) |
(779) |
(12) |
(1,576) |
|
Equity-accounted entities |
84 |
8 |
307 |
- |
3 |
(29) |
373 |
|
Net income on other assets |
(0) |
(39) |
(8) |
6 |
(13) |
3 |
(51) |
|
Change in value of goodwill |
- |
0 |
- |
- |
497 |
- |
497 |
|
Income before
tax |
3,581 |
2,213 |
1,084 |
1,109 |
545 |
(453) |
8,080 |
|
Tax |
(642) |
(512) |
(120) |
(309) |
199 |
148 |
(1,236) |
|
Net income from discontinued or held-for-sale operations |
5 |
- |
- |
- |
1 |
- |
5 |
|
Net income |
2,944 |
1,701 |
964 |
800 |
745 |
(305) |
6,849 |
|
Non controlling interests |
(524) |
(90) |
(157) |
(36) |
(187) |
(12) |
(1,005) |
|
Net income Group
Share |
2,420 |
1,611 |
808 |
764 |
558 |
(317) |
5,844 |
Appendix 4 – Methods used to calculate earnings per
share, net asset value per share
| Crédit
Agricole S.A. - data per share |
|
|
|
|
|
|
|
|
|
|
(€m) |
|
Q4-2022 |
Q4-2021 |
|
2022 |
2021 |
|
∆ Q4/Q4 |
∆ 2022/2021 |
|
|
|
|
|
|
|
|
|
|
|
| Net income Group
share - stated |
|
1,557 |
1,428 |
|
5,437 |
5,844 |
|
+9.0% |
(7.0%) |
| - Interests on
AT1, including issuance costs, before tax |
|
(85) |
(63) |
|
(412) |
(353) |
|
+34.9% |
+16.7% |
| NIGS attributable
to ordinary shares - stated |
[A] |
1,472 |
1,365 |
|
5,025 |
5,491 |
|
+7.8% |
(8.5%) |
| Average number
shares in issue, excluding treasury shares (m) |
[B] |
3,025 |
3,022 |
|
2,989 |
2,990 |
|
+0.1% |
(0.0%) |
|
Net earnings per share - stated |
[A]/[B] |
0.49 € |
0.45 € |
|
1.68 € |
1.84 € |
|
+7.7% |
(8.5%) |
| Underlying net
income Group share (NIGS) |
|
1,531 |
1,435 |
|
5,468 |
5,397 |
|
+6.7% |
+1.3% |
| Underlying NIGS
attributable to ordinary shares |
[C] |
1,446 |
1,372 |
|
5,056 |
5,044 |
|
+5.4% |
+0.2% |
|
Net earnings per share - underlying |
[C]/[B] |
0.48 € |
0.45 € |
|
1.69 € |
1.69 € |
|
+5.2% |
+0.3% |
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
(€m) |
|
|
|
|
31/12/2022 |
31/12/2021 |
|
|
|
| Shareholder's
equity Group share |
|
|
|
|
64,633 |
68,217 |
|
|
|
| - AT1
issuances |
|
|
|
|
(5,989) |
(4,888) |
|
|
|
| - Unrealised
gains and losses on OCI - Group share |
|
|
|
|
3,536 |
(2,125) |
|
|
|
| - Payout
assumption on annual results* |
|
|
|
|
(3,175) |
(3,176) |
|
|
|
|
Net book value (NBV), not revaluated, attributable
to ordin. sh. |
[D] |
|
|
|
59,005 |
58,027 |
|
|
|
| - Goodwill &
intangibles** - Group share |
|
|
|
|
(18,395) |
(18,581) |
|
|
|
|
Tangible NBV (TNBV), not revaluated attrib. to ordinary
sh. |
[E] |
|
|
|
40,610 |
39,446 |
|
|
|
| Total shares in
issue, excluding treasury shares (period end, m) |
[F] |
|
|
|
3,023.6 |
3,025.2 |
|
|
|
| NBV per share ,
after deduction of dividend to pay (€) |
[D]/[F] |
|
|
|
19.5 € |
19.2 € |
|
|
|
| + Dividend to pay
(€) |
[H] |
|
|
|
1.05 € |
1.05 € |
|
|
|
| NBV per share ,
before deduction of dividend to pay (€) |
|
|
|
|
20.6 € |
20.2 € |
|
|
|
| TNBV per share,
after deduction of dividend to pay (€) |
[G]=[E]/[F] |
|
|
|
13.4 € |
13.0 € |
|
|
|
| TNBV per sh.,
before deduct. of divid. to pay (€) |
[G]+[H] |
|
|
|
14.5 € |
14.1 € |
|
|
|
| * dividend
proposed to the Board meeting to be paid |
|
|
|
|
|
|
|
|
|
| ** including
goodwill in the equity-accounted entities |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
(€m) |
|
|
|
|
2022 |
2021 |
|
|
|
| Net income Group
share - stated |
[K] |
|
|
|
5,437 |
5,844 |
|
|
|
| Impairment of
intangible assets |
[L] |
|
|
|
0 |
0 |
|
|
|
| IFRIC |
[M] |
|
|
|
0 |
0 |
|
|
|
| Stated NIGS
annualised |
[N] = ([K]-[L]-[M])*4/4+[M] |
|
|
|
5,437 |
5,844 |
|
|
|
| Interests on AT1,
including issuance costs, before tax, annualised |
[O] |
|
|
|
-412 |
-353 |
|
|
|
| Stated result
adjusted |
[P] = [N]+[O] |
|
|
|
5,025 |
5,491 |
|
|
|
| Tangible NBV
(TNBV), not revaluated attrib. to ord. sh. - avg*** |
[J] |
|
|
|
40,028 |
38,645 |
|
|
|
| Stated ROTE
adjusted (%) |
= [P] / [J] |
|
|
|
12.6% |
14.2% |
|
|
|
| Underlying Net
income Group share |
[Q] |
|
|
|
5,468 |
5,397 |
|
|
|
| Underlying NIGS
annualised |
[R] = ([Q]-[M])*4/4+[M] |
|
|
|
5,468 |
5,397 |
|
|
|
| Underlying NIGS
adjusted |
[S] = [R]+[O] |
|
|
|
5,056 |
5,044 |
|
|
|
| Underlying ROTE
adjusted(%) |
= [S] / [J] |
|
|
|
12.6% |
13.1% |
|
|
|
| ***
including assumption of dividend for the current exercise |
|
|
|
0.0% |
0.0% |
|
|
|
Alternative Performance
Indicators87
NBV Net Book Value not
re-evaluatedThe Net Book Value not re-evaluated
corresponds to the shareholders’ equity Group share from which the
amount of the AT1 issues, the unrealised gains and/or losses on OCI
Group share and the pay-out assumption on annual results have been
deducted.
NBV per share Net Book Value per share -
NTBV per share Net Tangible Book Value per shareOne of the
methods for calculating the value of a share. This represents the
Net Book Value divided by the number of shares in issue at end of
period, excluding treasury shares.
Net Tangible Book Value per share represents the
Net Book Value after deduction of intangible assets and goodwill,
divided by the number of shares in issue at end of period,
excluding treasury shares.
EPS Earnings per ShareThis is
the net income Group share, from which the AT1 coupon has been
deducted, divided by the average number of shares in issue
excluding treasury shares. It indicates the portion of profit
attributable to each share (not the portion of earnings paid out to
each shareholder, which is the dividend). It may decrease, assuming
the net income Group share remains unchanged, if the number of
shares increases.
Cost/income ratioThe
cost/income ratio is calculated by dividing operating expenses by
revenues, indicating the proportion of revenues needed to cover
operating expenses.
Cost of
risk/outstandingsCalculated by dividing
the cost of credit risk (over four quarters on a rolling basis) by
outstandings (over an average of the past four quarters, beginning
of the period). It can also be calculated by dividing the
annualised cost of credit risk for the quarter by outstandings at
the beginning of the quarter. Similarly, the cost of risk for the
period can be annualised and divided by the average outstandings at
the beginning of the period.
Since the first quarter of 2019, the
outstandings taken into account are the customer outstandings,
before allocations to provisions.
The calculation method for the indicator is
specified each time the indicator is used.
Doubtful loanDefaulting loan.
The debtor is considered to be in default when at least one of the
following conditions has been met:
- a payment
generally more than 90 days past due, unless specific circumstances
point to the fact that the delay is due to reasons independent of
the debtor’s financial situation;
- the entity
believes that the debtor is unlikely to settle its credit
obligations unless it avails itself of certain measures such as
enforcement of collateral security right.
Impaired loanLoan which has
been provisioned due to a risk of non-repayment.
MRELThe MREL (Minimum
Requirement for Own Funds and Eligible Liabilities) ratio is
defined in the European “Bank Recovery and Resolution Directive”
(BRRD). This Directive establishes a framework for the resolution
of banks throughout the European Union, with the aim to provide
resolution authorities with shared instruments and powers to
pre-emptively tackle banking crises, preserve financial stability
and reduce taxpayers’ exposure to losses. Directive (EU) 2019/879
of 20 May 2019 known as “BRRD2” amended the BRRD and was transposed
into French law by Order 2020-1636 of 21 December 2020.
The MREL ratio corresponds to an own funds and
eligible liabilities buffer required to absorb losses in the event
of resolution. Under BRRD2, the MREL ratio is calculated as the
amount of eligible capital and liabilities expressed as a
percentage of risk weighted assets (RWA), as well as a leverage
ratio exposure (LRE). Are eligible for the numerator of the total
MREL ratio the Group’s regulatory capital, as well as eligible
liabilities issued by the central body and the Crédit Agricole
network affiliated entities, i.e. subordinated notes, senior
non-preferred debt instruments and certain senior preferred debt
instruments with residual maturities of more than one year.
Impaired (or doubtful) loan coverage
ratio This ratio divides the outstanding provisions
by the impaired gross customer outstandings.
Impaired (or doubtful) loan
ratio This ratio divides the gross customer
outstandings depreciated on an individual basis, before provisions,
by the total gross customer outstandings.
TLACThe Financial Stability
Board (FSB) has defined the calculation of a ratio aimed at
estimating the adequacy of the bail-in and recapitalisation
capacity of Global Systemically Important Banks (G-SIBs). This
Total Loss Absorbing Capacity (TLAC) ratio provides
resolution authorities with the means to assess whether G-SIBs have
sufficient bail-in and recapitalisation capacity before and during
resolution. It applies to Global Systemically Important Banks, and
therefore to Crédit Agricole Group.
The Group’s regulatory capital as well as
subordinated notes and eligible senior non-preferred debt with
residual maturities of more than one year issued by
Crédit Agricole S.A. are eligible for the numerator of
the TLAC ratio.
Net income Group shareNet
income/(loss) for the financial year (after corporate income tax).
Equal to net income Group share, less the share attributable to
non-controlling interests in fully consolidated subsidiaries.
Underlying Net income Group
shareThe underlying net income Group share represents the
stated net income Group share from which specific items have been
deducted (i.e. non-recurring or exceptional items).
Net income Group share attributable to
ordinary shares The net income Group share attributable to
ordinary shares represents the net income Group share from which
the AT1 coupon has been deducted, including issuance costs before
tax.
RoTE Return on Tangible
EquityThe RoTE (Return on Tangible Equity) measures the
return on tangible capital by dividing the Net income Group share
annualised by the group’s NBV net of intangibles and goodwill. The
annualised Net income Group share corresponds to the annualisation
of the Net income Group share (Q1x4; H1x2; 9Mx4/3) excluding
impairments of intangible assets and restating each period of the
IFRIC impacts in order to linearise them over the year.
Disclaimer
The financial information on
Crédit Agricole S.A. and Crédit Agricole Group
for the fourth quarter and full year 2022 comprises this
presentation and the attached appendices and press release which
are available on the website:
https://www.credit-agricole.com/finance/publications-financieres.
This press release may include prospective
information on the Group, supplied as information on trends. This
data does not represent forecasts within the meaning of EU
Delegated Act 2019/980 of 14 March 2019 (chapter 1, article 1,
d).
This information was developed from scenarios
based on a number of economic assumptions for a given competitive
and regulatory environment. Therefore, these assumptions are by
nature subject to random factors that could cause actual results to
differ from projections. Likewise, the financial statements are
based on estimates, particularly in calculating market value and
asset impairment.
Readers must take all these risk factors and
uncertainties into consideration before making their own
judgement.
Applicable standards and
comparability
The figures presented for the twelve-month
period ending 31 December 2022 have been prepared in accordance
with IFRS as adopted in the European Union and applicable at that
date, and with prudential regulations currently in force. This
financial information does not constitute a set of financial
statements for an interim period as defined by IAS 34 “Interim
Financial Reporting” and has not been audited.
Note: The scopes of consolidation of the
Crédit Agricole S.A. and Crédit Agricole Groups have not
changed materially since the Crédit Agricole S.A. 2021
Universal Registration Document and its A.01 update (including all
regulatory information about the Crédit Agricole Group) were filed
with the AMF (the French Financial Markets Authority).
The sum of values contained in the tables and
analyses may differ slightly from the total reported due to
rounding.
At 30 June 2021, following the buyback by
Crédit Agricole Consumer Finance of 49% of the share
capital of the CACF Bankia S.A. joint venture, CACF Bankia S.A. is
fully consolidated in Crédit Agricole S.A.’s consolidated
financial statements.
As at 30 June 2021 following the takeover bid
launched by Crédit Agricole Italia for Credito Valtellinese, 100%
of Credito Valtellinese is held by Crédit Agricole Italia and is
fully consolidated in the consolidated financial statements of
Crédit Agricole S.A.
At 31 December 2021, Amundi announcement
completion of the Lyxor acquisition. Lyxor is fully consolidated in
the consolidated financial statements of Crédit Agricole S.A. The
transaction had no impact on Crédit Agricole S.A.’s consolidated
income at 31 December 2021.
Financial Agenda
10 May
2023 Publication
of the 2023 first quarter results17 May
2023 Annual
General Meeting in Paris4 August
2023 Publication
of the 2023 third quarter and the first half year results8 November
2023 Publication
of the 2023 third quarter and first 9 months results
Contacts
CREDIT AGRICOLE PRESS CONTACTS
Alexandre Barat + 33 1 57 72 12
19 alexandre.barat@credit-agricole-sa.frOlivier
Tassain + 33 1 43 23
25
41 olivier.tassain@credit-agricole-sa.frMathilde
Durand
+ 33 1 57 72 19
43
mathilde.durand@credit-agricole-sa.frBertrand
Schaefer +33 (0)1 49
53 43
76 bertrand.schaefer@ca-fnca.fr
CRÉDIT AGRICOLE S.A. INVESTOR RELATIONS
CONTACTS
| Institutional
shareholders |
+ 33 1 43 23 04
31 |
investor.relations@credit-agricole-sa.fr |
| Individual
shareholders |
+ 33 800
000 777 (freephone number – France only) |
relation@actionnaires.credit-agricole.com |
| |
|
|
| Clotilde
L’Angevin |
+ 33 1 43 23 32
45 |
clotilde.langevin@credit-agricole-sa.fr |
|
Equity investors: |
|
|
| Jean-Yann
AsserafFethi Azzoug |
+ 33 1 57 72 23 81+
33 1 57 72 03 75 |
jean-yann.asseraf@credit-agricole-sa.fr
fethi.azzoug@credit-agricole-sa.fr |
| Joséphine
Brouard |
+ 33 1 43 23 48
33 |
joséphine.brouard@credit-agricole-sa.fr |
| Oriane Cante |
+ 33 1 43 23 03
07 |
oriane.cante@credit-agricole-sa.fr |
| Nicolas
Ianna |
+ 33 1 43 23 55
51 |
nicolas.ianna@credit-agricole-sa.fr |
| Leila Mamou |
+ 33 1 57 72 07
93 |
leila.mamou@credit-agricole-sa.fr |
| Anna
Pigoulevski |
+ 33 1 43 23 40
59 |
anna.pigoulevski@credit-agricole-sa.fr |
| Annabelle
Wiriath |
+ 33 1 43 23 55
52 |
annabelle.wiriath@credit-agricole-sa.fr |
| |
|
|
|
Credit investors and rating agencies: |
|
| Caroline
Crépin |
+ 33 1 43 23 83
65 |
caroline.crepin@credit-agricole-sa.fr |
| Rhita Alami
Hassani |
+ 33 1 43 23 15
27 |
rhita.alamihassani@credit-agricole-sa.fr |
| Florence Quintin
de Kercadio |
+ 33 1 43 23 25
32 |
florence.quintindekercadio@credit-agricole-sa.fr |
| |
|
|
| |
|
|
See all our press releases at: www.credit-agricole.com -
www.creditagricole.info
1 Over the quarter, production was up +0.9% compared to the
fourth quarter of 2021 for Regional Banks, LCL and CA Italia. In
France, loan production was up +0.6%, to €40.8 billion, compared to
the fourth quarter of 2021, including +5.5% for corporate and
professional loans (excluding SGL), offsetting the -1.5% decline in
home loan production and the -10.3% decline in consumer finance
production in the fourth quarter of 2022. In Italy, loan production
rose by 5.7% to €2.2 billion, including +5% in home loans and +6.3%
in corporate loan production excluding SGL and ecobonuses.2 Car,
home, legal, all mobile phones, or personal accident insurance3
Inflows were also dynamic on a quarterly basis, notably at Amundi
(+€15.0 billion between 30 September 2022 and 31 December 2022) and
Indosuez (+€0.9 billion)4 Unit-linked net inflows were also
positive in the fourth quarter of 2022 at +€1.7 billion.5 Property
and casualty insurance premium income increased sharply by +9.7% in
the fourth quarter of 2022 compared to the fourth quarter of
2021.6 +5.5% compared to the fourth quarter of 20217 EKO and LCL
Essentiel (with around 200,000 customers), CAC Budget Protégé (with
130,000 customers), Propulse by CA for micro-entrepreneurs and with
rate increases limited to 2% in 2022; end of penalties for
customers with the CAC Budget Protégé offer 8 Young adult rental
home insurance at €6/month (with over 3,000 contracts since
December 2022); Globe-trotter (409,000 customers)9 With Points
Passerelle (more than 10,000 families supported in 2021); and an
artificial intelligence tool for the early detection of financial
fragility in order to better support vulnerable customers10 €375
million invested in 2022; three funds for the CARD, CA Transition
and LCL Croissance regions: total target of €700 million11 More
than 420,000 real estate transactions financed by the Regional
Banks and LCL in 2022, out of a market of 1,110,000 in France12
Press release as at 7 December 202213 See Appendixes for more
details on specific items. 14 At constant scope: Lyxor (GEA) added
in the fourth quarter of 202115 The cost of risk relative to
outstandings (in basis points) on a four quarter rolling basis is
calculated on the cost of risk of the past four quarters divided by
the average outstandings at the start of each of the four
quarters16 The cost of risk relative to outstandings (in basis
points) on an annualised basis is calculated on the cost of risk of
the quarter multiplied by four and divided by the outstandings at
the start of the quarter17 +€422 million in net income Group share
from Creval badwill, +€89 million in net income Group share from
Creval off-balance sheet DTA, -€12 million in net income Group
share from other adjustments related to the Creval integration, as
well as -€26 million in net income Group share from IT upgrades and
migrations18 Integration of Creval and Lyxor in 2021
19 Analysis based on 31/12 data for
Crédit Agricole S.A. and the
Crédit Agricole Group, as well as 30/09/2022 publications
on customer loans, Stage 3 outstandings and Stage 1, 2 and 3
provisions from Banco Santander, Barclays, BNP Paribas, Crédit
Suisse, Deutsche Bank, HSBC, Société Générale, Standard Chartered,
UBS, and finally, from the 30/06/2022 Unicredit publication, Groupe
BPCE and ING.20 Number of customers with an active profile on the
Ma Banque app or who had visited CAEL during the month/number of
adult customers having an active demand deposit account21
Signatures initiated in BAM deposit mode (multi-channel bank
access), Mobile customer portal or Ma Banque app22 Specialised
markets: farmers, professionals, corporates and public
authorities23 Average quarterly rates, all markets, all loans
(fixed rate term loans in euros)24 Credit rate on monthly
achievements. Only maturity loans, in euros and at a fixed rate,
are taken into account
25 Underlying, excluding specific items. See
Appendixes for more details on specific items. 26 Corporate Centre
expenses in 2022 related to the volatility of intra-group
transactions with the Regional Banks in Q1-2022.
27 Provisioning rate calculated with
outstandings in Stage 3 as denominator, and the sum of the
provisions recorded in Stages 1, 2 and 3 as numerator.28 The cost
of risk relative to outstandings (in basis points) on a four
quarter rolling basis is calculated on the cost of risk of the past
four quarters divided by the average outstandings at the start of
each of the four quarters29 The cost of risk relative to
outstandings (in basis points) on an annualised basis is calculated
on the cost of risk of the quarter multiplied by four and divided
by the outstandings at the start of the quarter30
See Appendixes for
more details on specific items.31 See details on the calculation of
the business lines’ RoTE (return on tangible equity) and RONE
(return on normalised equity) on p. 51.32 The annualised underlying
net income Group share corresponds to the annualisation of the
underlying net income Group share (Q1x4; H1x2; 9Mx4/3) by restating
each period for IFRIC impacts to linearise them over the year33
Arithmetic mean of 10 major European banks: Société Générale; BNP
Paribas; Santander; UniCredit; Crédit Suisse; UBS; Deutsche Bank;
HSBC; Standard Chartered; Barclays. Ratio floored at 0% when the
ROTE is negative. Data used for HSBC, Standard Chartered, Barclays
and Crédit Suisse are based on the 30/09/2022 reporting34 Creval
(in International retail banking) and Lyxor (in Asset gathering)
added in 202135 In order to be certain about comparable data, the
comparison with the sample of European banks was made on the basis
of a reported cost/income ratio, including SRF.36 Société Générale;
BNP Paribas; Banco Santander; UniCredit; Crédit Suisse; UBS;
Deutsche Bank; HSBC; Standard Chartered; Barclays. . Data used for
HSBC, Standard Chartered Barclays and Crédit Suisse are based on
the 30/09/2022 reporting37Note that the refund of an SRF
overpayment for financial years 2016–2021 was recognised in the
amount of €130 million under specific items in first quarter
2021.38The €113 million increase in provisioning on performing
loans does not include the €195 million provisioned in the first
quarter of 2022 against the value of
Crédit Agricole S.A.’s shares in
Crédit Agricole Ukraine. That provision has been restated
in underlying income.39 Excluding La Médicale40 Scope “Life
France”
41 Scope: property and casualty in France and
abroad42 Excluding La Médicale43 LCL Private Banking and Indosuez
Wealth Management44 For the Crédit Agricole Assurance scope, the
2021 financial year benefited from a reduced effective rate,
notably in connection with the disposal of securities at the
reduced-tax rate.45 Excluding La Medicale; as a reminder, base
effect in Q4-21 due to the transition of La Médicale to IFRS5
(revenues -€31m, costs +€35m, net income Group share +€4.9m) 46
Excluding La Medicale47 Corporate social welfare tax48 For the
Crédit Agricole Assurance scope, the 2021 financial year benefited
from a reduced effective rate, notably in connection with the
disposal of securities at the reduced-tax rate.49 Constant scope:
including Lyxor50 52.1% excluding amortisation expense on
intangible assets51 Indosuez Wealth Management scope52 Refinitiv53
Bloomberg54 Based on 31 March 2022 figures; for assets under
administration55 Estimated on figures as at 30 June 202256
Operational register keeping, organisation of general meetings and
other services to issuers in France57 Excluding impact of first
consolidation of CACEIS Fonds Services GmbH in fourth quarter
202158 inc. Olinn acquired by CAL&F in Q4 2021 (in 2022,
underlying GOI of €5.2m with revenues of €30.9m and expenses of
-€25.7m; excluding Olinn, 2022/2021, revenues +4.3%, expenses excl.
SRF +7.5% / In Q4, revenues +6.7%, expenses excl. SRF +9.6% – NB:
CACF Spain fully consolidated since Q3 2021; Q1 and Q2 21% to 50%
as equity-accounted entities
59Cost of risk on an annualised quarterly basis60 Cost of risk
for the last four quarters as a proportion of the average
outstandings at the beginning of the period for the last four
quarters
61 Excluding state-guaranteed loans 62 Net
customer capture: 22,500 clients
63 Excluding “Ecobonuses”, the production of
which increased 2.6 times that of all twelve months of 2021.
“Ecobonuses” correspond to refinancing of the customer tax credit:
Italian tax deductions for renovation, energy efficiency and
building safety, introduced in 2021. Excluding SGL.64 Agos65
Disposed entities: Serbia classified under IFRS 5 since second
quarter 2021 (disposal effective 1 April 2022) and Crédit du Maroc
classified under IFRS 5 since first quarter 2022 and disposal of
controlling interest in fourth quarter 2022.66 Over a rolling four
quarter period67 Excluding Corporate Centre68 Without
restatement for scope, in fourth quarter
2022 versus fourth quarter 2021: the underlying
revenues of Retail banking excluding Italy
totalled €212 million, a decrease of -6.6% (idem stated).
Underlying expenses declined by -23.1% (idem stated). Underlying
gross operating income totalled €103 million, an increase of
+20.8%. (idem stated). The underlying cost/income ratio
excluding SRF was 51.5% (idem stated), down
11 percentage points. Cost of risk was up, rising from
-€14 million to -€59 million, primarily due to the provisioning on
Ukraine. Underlying taxes came to -€15 million in fourth
quarter 2022, down -30.9% compared with fourth quarter 2021. Gains
or losses on discontinued activities amounted to -€28 million as
stated and take into account the Net Income of Crédit du Maroc
(classified under IFRS 5 since first quarter 2022) as well as a
provision of -€14 million for Crédit Agricole du Maroc classified
as a specific item. Gains or losses on discontinued activities
amounted to -€14 million underlying in fourth quarter 2022.
Ultimately, underlying net income Group share totalled
€13 million in fourth quarter 2022, a decline of -67.0% from
fourth quarter 2021 (stated net income Group share of -€1 million
in fourth quarter 2022).69 Without restatement for
scope, over the year 2022 versus
2021: the underlying revenues of Retail
banking excluding Italy totalled €777 million, a
decrease of -7.1% (-9.3% stated). Underlying expenses excluding SRF
declined by -16.4% (-idem stated). Underlying gross operating
income increased by +8.5% (+2.7% stated) and the underlying
cost/income ratio excluding SRF was 56.2% (57.8% stated), a
decrease of 6.3 percentage points (down 4.9 percentage points
stated). Stated cost of risk amounted to -€388 million in 2022 and
takes into account a Ukraine provision of -€195 million (allocated
in first quarter 2022). The underlying cost of risk was -€193
million, primarily impacted by -€128 million in additional
provisions allocated for Ukraine. Underlying taxes amounted to
-€52 million in fourth quarter 2022, down -29.1% (-34.6%
stated). Ultimately, underlying net income Group share was €76
million, down -32.3% from 2021 (from €109 million to -€160 million
stated between 2021 and 2022).70 Countercyclical buffer of
5 bps at 31 December 2022, expected to be 42 bps at 31
December 2023 and 74 basis points at 2 January 2024 for the
Crédit Agricole Group based on information known to date,
in particular the increase in the French countercyclical buffer
rate to 0.50% as from April 2023, then 1% as from January 2024. 71
On the basis of public data on 8/2/2023 for the 13 European G-SIB
banks: BPCE (data at 30/09/2022) , BNP Paribas (data at
31/12/2022), Crédit Agricole Group (data at 31/12/2022),
Deutsche Bank (data at 31/12/2022), ING (data at 31/12/2022),
Santander (data at 31/12/2022), Société Générale (data at
31/12/2022), Unicredit (Pillar 3 data at 30/09//2022), Crédit
Suisse (data at 30/09/2022), Barclays (data at 30/09/2022), HSBC
(data at 30/09/2022), Standard Chartered (data at 30/09/2022) and
UBS (data at 31/12/2022), as well as Crédit Agricole S.A. at
31/12/2022. Distance from SREP or requirement in CET1 equivalent72
Decrease in the counterparty risk of the trading book73 the
recovery of the equity markets and tightening of credit spreads
offsetting the rise in long rates during the quarter74 Including
international subsidiaries of Regional banks75 As part of its
annual resolvability assessment, Crédit Agricole Group has
chosen to waive the possibility offered by Article 72ter(3) of the
Capital Requirements Regulation (CRR) to use senior preferred debt
for compliance with its TLAC requirements in 2022.76
Countercyclical buffer of 6 bp at 31 December 2022, expected
to be 37 bp at 31 December 2023 and 60 bp at 2 January 2024
for Crédit Agricole S.A. based on information known to
date, in particular the increase in the French countercyclical
buffer rate to 0.50% which comes into force in April 2023, rising
to 1% from January 2024.77 Mainly related to the decrease in
counterparty risk on the trading book.78 Reduced impact compared to
the first nine months of 2022 due to the reduction of Russian
exposures in the fourth quarter of 2022.79 Excluding FCA Bank80
Excluding FCA Bank81 Gross amount before buy-backs and
amortisations82 Excl. AT1 issuances83 83% in EUR, 4% in USD, 4% in
GBP, 3% in JPY, 3% in CHF and 3% other (NOK, HKD, SGD, AUD).
84 In terms of annualised quarterly change, GDP
contracted by 1.6% and then by 0.6%. The decline in the first
quarter was due to a highly negative contribution from net exports;
the decline in the second quarter can mainly be explained by
destocking. Considering that other variables necessary for the
diagnosis (including real household income excluding transfers and
non-agricultural paid employment etc.) have held up well, this
period has not been officially classified as a recession by the
NBER.85 The increase in energy imports in the first nine months of
2022 compared to the same period in 2021 stood at 4.3 GDP
points. Before the redistribution of this burden among key players
(mainly via government support to households and companies and the
transfer of the cost increase from producers to consumers), this
additional cost affects customers according to their relative
energy consumption: 29% to households, 68% to companies and 3% to
administrations.86 Domestic performances were very mixed, with
Germany seeing growth of 1.8% (2.6% in 2021), France of 2.6% (6.8%
in 2021) and Italy of 3.9% (6.7% in 2021), while Spain once again
grew by 5.5% (5.5% in 2021).
87 APM indicators are financial indicators not presented in the
financial statements or defined in accounting standards but used in
the context of financial communications. They are used to
facilitate the understanding of the company’s actual performance.
Each APM indicator is matched in its definition to accounting
data.
- EN_CASA_CP_2022-T4_Resultats
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