Amendment to the risk factors of the Universal registration
Document of Crédit Agricole S.A.
Montrouge, 22 June 2022
Amendment to the risk factors of the
Universal registration Document of Crédit Agricole
S.A.
Following the publication of its new Medium term Plan on 22 June
2022, the paragraph 1.1.5 a) of the risk factors section of the
Universal Registration Document of Crédit Agricole S.A. related to
risk factors pursuant to the achievement of the Medium-Term Plan
target is modified according to the appendix 1. Paragraph
1.1.5 a) of the risk factors section of the Amendment A01 of Crédit
Agricole S.A.’s Universal Registration Document related to risk
factors pursuant to the achievement of the Medium-Term Plan target
is modified according to the appendix 2.
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Appendix 1
1.1.5 Risk
related to the strategy and transactions of
Crédit Agricole S.A.
a) Crédit Agricole S.A.
may not achieve the targets set out in its Medium-Term
Plan
On 22 June 2022, Crédit Agricole S.A. announced
its 2025 Medium-Term Plan “2025 Ambitions” (the
“Medium-Term Plan”). The Medium-Term Plan relies
on the strength of the Crédit Agricole Group business model, based
on the comprehensive and sustainable relationship for all clients,
all regions and all channels. This development also leverages on
business lines that have their own development dynamics and that
have become leaders and consolidators on their respective markets.
The Medium-Term Plan also relies on the organic growth strategy of
Crédit Agricole Group. The Group targets 1 million additional
customers in retail banking by 2025 and aims at increasing the
customer equipment in P&C insurance savings solutions and real
estate. It has the ambition of widening and adapting its offer
range (more accessible, more responsible and more digital) so as to
answer new customer needs. In addition, , the partnership and
targeted acquisition strategy will be continued, with compliance to
the profitability criteria (ROI > 10% by 3 years). Crédit
Agricole S.A. targets new distribution partnerships with financial
players as well as industrial and technological partnerships. In
the Medium-Term Plan, Crédit Agricole S.A. aims at developing its
worldwide business lines, increasing the pace of its growth on
transversal businesses such as payments, real estate, digital
banking and technology-as-a-service, and accelerating its
technological, digital and human transformation.
The Medium-Term Plan includes a number of
financial targets, notably on the cost to income ratio, the net
income, the return on equity and capital adequacy ratios. These
financial targets, established primarily for purposes of internal
planning and allocation of resources, are based on a number of
assumptions with regard to the economic climate and the activity of
the business lines of the Crédit Agricole S.A. The financial
targets do not constitute projections or forecasts of anticipated
results. The actual results of Crédit Agricole S.A. are likely to
vary (and could vary significantly) from these targets for a number
of reasons, including the materialisation of one or more of the
risk factors described in this section. For example,
Crédit Agricole S.A. expects to achieve the following targets
presented in the Medium-Term Plan: a net income group share in
excess of €6 billion by 2025, a permanent ceiling of the cost to
income ratio to below 60% which will be lowered to 59% post
implementation of the IFRS17 reform, return on tangible equity
(RoTE) in excess of 12% by 2025, a CET1 ratio of 11% across the
Medium-Term Plan with a floor at all time of 250bp above the
minimum SREP requirement (together with a strategy of optimisation
of the AT1 bucket). The Medium-Term Plan also provides a dividend
distribution target of 50% in cash, even in case of moves of the
CET1 ratio around its Medium-Term Plan target. In 2023, it is
Crédit Agricole S.A. intention to propose to the General
Shareholder Meeting an additional dividend of €0.20 per share that
was not distributed for 2019 dividend.
In addition, as a responsible and committed
player, the Crédit Agricole Group adopts a fair climate transition
approach that preserves social and territorial cohesion. This
approach is based on three priorities: acting for climate,
strengthening social cohesion, in particular by acting for equal
access to healthcare, and ensuring the success of the agricultural
and agri-food transitions.
For climate, the Group’s action is consistent
with its contribution to global carbon neutrality by 2050. End
2021, Crédit Agricole initiated a major methodological project to
define decarbonisation trajectories for ten economic sectors
financed by the bank, applicable to each business line and each
entity. These ten sectors account for 75% of global carbon
emissions and 60% of the Group’s credit exposure. This work is
based on the International Energy Agency’s Net Zero Emissions
scenario and follows the Glasgow Financial Alliance principles to
chart a progressive withdrawal from the highest CO2-emitting
assets. The path is complex. It requires enhanced customer dialogue
to facilitate decarbonisation of the economy while avoiding social
shock.
Crédit Agricole Group has already mapped out its
gradual withdrawal from the oil and gas sector by setting a target
of decreasing sector-financing-related CO2 emissions by 30% in
absolute value between 2020 and 2030. We are also committed to
supporting the decarbonisation of the automotive sector by reducing
the carbon intensity of our sector portfolio by 50% over the same
period (Crédit Agricole CIB, Crédit Agricole Consumer Finance and
Crédit Agricole Leasing & Factoring France portfolios).
The target for the reduction of our own carbon
footprint, scope 1 and 2 (energy, fleet and business travel) is
also set at a minimum of 50% by 2030.
The sectoral trajectories that we will continue
to define and publish in 2022 and 2023 will be accompanied by
action plans to ensure their implementation. For the oil and gas
sector, the action plan will include the adoption of a new policy
in line with the recommendations of the Glasgow Financial Alliance
for Net Zero.
At the same time, Crédit Agricole is
accelerating its support for renewable energies by targeting 60%
growth in CACIB’s exposure to low-carbon energies by 2025 and the
achievement of 14 GW of installed capacity via Crédit Agricole
Assurances’ investments in 2025.
To go further, the Group is structuring itself
and launching two new business lines:
- Crédit
Agricole Transitions & Energies, to make energy transitions
accessible to all,
- Crédit
Agricole Santé & Territoires to facilitate access to healthcare
and ageing services.
Non-compliance with these ESG commitments may
cause damage to Crédit Agricole S.A.’s reputation, which could lead
to a negative impact on its business.
More generally, the Medium-Term Plan success
relies on a number of initiatives of different importance, to be
rolled out in different Crédit Agricole Group entities. Though a
big part of the Medium-Term Plan targets may be achieved, it is not
possible to predict which ones will be achieved and which ones will
not. The Medium-Term Plan also plans for significant investments,
which return may be below projections if Medium-Term Plan targets
are not achieved at the end. Thus, if Crédit Agricole S.A. is not
in capacity to achieve the Medium-Term Plan targets (either totally
or partially), its financial position and its performance could be
significantly impacted in an adverse manner.
Appendix 2
1.5 Risk related
to the strategy and transactions of the Crédit Agricole
Group
a) The
Crédit Agricole Group may not achieve the targets set out
in its Medium-Term Plan
On 22 June 2022, Crédit Agricole Group
announced its 2025 Medium-Term Plan (the “Medium-Term Plan”). The
Medium-Term Plan relies on the strength of the Crédit Agricole
Group business model, based on the comprehensive and sustainable
relationship for all clients, all regions and all channels. This
development also leverage on business lines that have their own
development dynamics and have become leaders and consolidators on
their respective markets. The Medium-Term Plan also relies on the
organic growth strategy of Crédit Agricole Group. The Group targets
1 million additional customers in retail banking by 2025 and aims
at increasing the customer equipment in P&C insurance savings
solutions and real estate. It has the ambition of widening and
adapting its offer range (more accessible, more responsible and
more digital) so as to answer new customer needs. In addition, the
partnership and targeted acquisition strategy will be continued,
with compliance to the profitability criteria (ROI > 10% by 3
years). Crédit Agricole S.A. targets new distribution partnerships
with financial players as well as industrial and technological
partnerships. In the Medium-Term Plan, Crédit Agricole S.A. aims at
developing its worldwide business lines, increasing the pace of its
growth on transversal businesses such as payments, real estate,
digital banking and technology-as-a-service, and accelerating its
technological, digital and human transformation. The Medium-Term
Plan includes a number of financial targets, notably on the cost to
income ratio, the net income, the return on equity, capital
adequacy ratios and liquidity.. These financial targets were
established primarily for purposes of internal planning and
allocation of resources, and are based on a number of assumptions
with regard to the economic climate and the activity of the
business lines of the Crédit Agricole Group. The financial targets
do not constitute projections or forecasts of anticipated results.
The actual results of Crédit Agricole Group are likely to vary (and
could vary significantly) from these targets for a number of
reasons, including the materialisation of one or more of the risk
factors described elsewhere in this section. For example,
Crédit Agricole Group expects to post by 2025 a CET1 ratio above or
equal to 17% and a TLAC ratio above or equal to 26% (without any
eligible senior preferred debt). In addition, the Stable Resources
Position Target set in the medium-Term Plan between €110 and 130
billion would allow to meet comfortably the regulatory requirement
in relation to long term liquidity structural ratio (Net Stable
Funding Ratio or NSFR)
In addition, as a responsible and committed
player, the Crédit Agricole Group adopts a fair climate transition
approach that preserves social and territorial cohesion. This
approach is based on three priorities: acting for climate,
strengthening social cohesion, in particular by acting for equal
access to healthcare, and ensuring the success of the agricultural
and agri-food transitions.
For climate, the Group’s action is consistent
with its contribution to global carbon neutrality by 2050. End
2021, Crédit Agricole initiated a major methodological project to
define decarbonisation trajectories for ten economic sectors
financed by the bank, applicable to each business line and each
entity. These ten sectors account for 75% of global carbon
emissions and 60% of the Group’s credit exposure. This work is
based on the International Energy Agency’s Net Zero Emissions
scenario and follows the Glasgow Financial Alliance principles to
chart a progressive withdrawal from the highest CO2-emitting
assets. The path is complex. It requires enhanced customer dialogue
to facilitate decarbonisation of the economy while avoiding social
shock.
Crédit Agricole Group has already mapped out its
gradual withdrawal from the oil and gas sector by setting a target
of decreasing sector-financing-related CO2 emissions by 30% in
absolute value between 2020 and 2030. We are also committed to
supporting the decarbonisation of the automotive sector by reducing
the carbon intensity of our sector portfolio by 50% over the same
period (Crédit Agricole CIB, Crédit Agricole Consumer Finance and
Crédit Agricole Leasing & Factoring France portfolios).
The target for the reduction of our own carbon
footprint, scope 1 and 2 (energy, fleet and business travel) is
also set at a minimum of 50% by 2030.
The sectoral trajectories that we will continue
to define and publish in 2022 and 2023 will be accompanied by
action plans to ensure their implementation. For the oil and gas
sector, the action plan will include the adoption of a new policy
in line with the recommendations of the Glasgow Financial Alliance
for Net Zero.
At the same time, Crédit Agricole is
accelerating its support for renewable energies by targeting 60%
growth in CACIB’s exposure to low-carbon energies by 2025 and the
achievement of 14 GW of installed capacity via Crédit Agricole
Assurances’ investments in 2025.
To go further, the Group is structuring itself
and launching two new business lines:
- Crédit
Agricole Transitions & Energies, to make energy transitions
accessible to all,
- Crédit
Agricole Santé & Territoires to facilitate access to healthcare
and ageing services.
Non-compliance with these ESG commitments may
cause damage to Crédit Agricole Group reputation, which may lead to
a negative impact on its business.
More generally, the Medium-Term Plan success
relies on a number of initiatives of different importance, to be
rolled out in different Crédit Agricole Group entities. Though a
big part of the Medium-Term Plan targets may be achieved, it is not
possible to predict which ones will be achieved and which ones will
not. The Medium-Term Plan also plans for significant investments,
which return may be below projections if Medium-Term Plan targets
are not achieved at the end. Thus, if Crédit Agricole Group is not
in capacity to achieve the Medium-Term Plan targets (either totally
or partially), its financial position and its performance could be
significantly impacted in an adverse manner.
CREDIT AGRICOLE S.A. PRESS
CONTACTS:
Charlotte de
Chavagnac Olivier Tassain Mathilde Durand |
+ 33 1 57 72 11 17
+ 33 1 43 23 25 41 + 33 1 57 72 19 43 |
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93 leila.mamou@credit-agricole-sa.frAnna
Pigoulevski +
33 1 43 23 40
59 anna.pigoulevski@credit-agricole-sa.frAnnabelle
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33 1 43 23 55
52 annabelle.wiriath@credit-agricole-sa.fr
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