CREDIT AGRICOLE SA: Results for the third quarter and the first
nine months of 2019 : Results increasing strongly
Montrouge, 8 November 2019 |
Results for the third quarter and the first nine months
of 2019
Q3‑19: Results increasing strongly
Crédit Agricole S.A. |
Underlying revenues1Q3:
€5,073 m +4.9% Q3/Q3 9M:
€15,154 m +1.8% 9M/9M |
Underlying net income2 Q3:
€1,226 m +8.2% Q3/Q3 9M:
€3,264 m -2.2% 9M/9M |
CET1 ratio 11.7% +0.1 pp
Sept/June, well above the MTP target |
- Stated result Q3: €1,199 m, +8.9% Q3/Q3
(9M: €3,183 m, -6.2% 9M/9M), up significantly Q3/Q3;
- Underlying income1
increased (+8.2% Q3/Q3) as a result of buoyant commercial
activity and improved operational efficiency;
- Underlying EPS: Q3 €0.34, -6.3%
Q3/Q3, 9M €0.97 -8.6% 9M/9M; ROTE3
11.3% annualised over 9M;
- Increase in underlying revenue (+4.9% Q3/Q3 and +1.8%
9M/9M), as a result of buoyant customers capture, savings,
loan and equipment;
- Significantly positive jaws effect (+340 bp Q3/Q3) and
improvement in the underlying cost/income ratio excluding
SRF4 (by -2.0 pp to 59.6% in Q3 and -0.4 pp to 60.5% over 9M)
despite development investments in the Asset Gathering business
line;
- Cost of credit risk low: 29 basis points5,
normalisation of the cost of risk in CIB, Q3/Q2 decrease for CACF
and CA Italy;
- CET1 ratio up +0.1 pp in Q3 to
11.7%, thanks in particular to the stability of organic
risk-weighted assets in the business lines;
- Upgrade by Moody’s of Casa’s LT credit rating to
Aa3;
- Continuation of implementation of the 2022 Medium-Term
Plan: growing digitalisation of customer relations,
increase in customer satisfaction, customer capture buoyant in
France and Italy (+210,000 individual customers); issue of a €1 bn
Green bond.
|
Crédit Agricole Group* |
Underlying revenues1Q3:
€8,331 m +2.9% Q3/Q3 9M:
€25,188 m +1.8% 9M/9M |
Underlying net income2Q3:
€1,924 m +6.0% Q3/Q3 9M:
€5,205 m -0.3% 9M/9M |
CET1 ratio 15.5% +0.1 pp
Sept/June +5.8 pp above SREP6 |
§ Stated net income2 for Q3: €1,849 m,
+4.5% Q3/Q3 (9M: €5,012 m, -5.0% 9M/9M);§
Operating expenses excl. SRF4 under control over 9M (+1.5%
9M/9M), cost/income ratio down (62.7%, -0.1 pp
9M/9M) § Cost of credit risk low at 20
basis points5, one-off provisions in CIB; § Increase
in the Regional Banks’ underlying revenues over 9 months (+1.9%),
cost of risk stable at 12 bp. * Crédit Agricole S.A. and
100% of Regional Banks. |
This press release comments on the results for Crédit Agricole
S.A. and for Crédit Agricole Group, which comprises the Crédit
Agricole S.A. entities and the Crédit Agricole Regional Banks,
which own 56.6% of Crédit Agricole S.A. Please see p.17 onwards of
this press release for details of specific items, which are
restated in the various indicators to calculate underlying results.
A reconciliation between the stated income statement and the
underlying income statement can be found from p.23 onwards for
Crédit Agricole Group and from p.19 onwards for
Crédit Agricole S.A.
Crédit Agricole
S.A.
Strong increase in underlying quarterly net
income Group share
- Underlying net income Group share: Q3-19 €1,226 m,
+8.2% Q3/Q3, 9M-19 €3,264 m, -2.2% 9M/9M, increase in business
line results (excluding Corporate Centre) (+6.8% Q3/Q3, +2.4%
9M/9M);
- Solid contributions from the Asset Gathering division, GOI
still strong in French Retail Banking, and strong growth (+24%) in
the contribution of CA Italia, good cost control and strong
contribution from automotive partnerships in Specialised Financial
Services, and solid performance in capital markets, with an
increase in the contribution from Large Customers despite the
reversal of the cost of risk in the division;
- Over 9M-19, underlying net income Group share high
(€3,264 m) despite the CC’s contribution being penalised by a
high H1-18 base, the +2.0 pp increase in the corporate income tax
rate, and the measured increase in the cost of risk, due to the
normalisation in CIB;
- Annualised underlying ROTE7 11.3%, good profitability
in all business lines.
Increase in underlying revenues Q3/Q3 (+4.9%)
and 9M/9M (+1.8%), as a result of dynamic commercial
activity
- String inflows in Asset management, Insurance, Wealth
management and Asset servicing. Record net inflows for Amundi;
- Property and casualty insurance outperforming the French market
(6.8% increase in premiums Q3/Q3), increase in customer equipment
rates (+1.5 pp for the Regional Banks Sept./Sept., +1.2 pp for
LCL);
- Continued growth in loans and customer savings, increase in
equipment rates, and continuing momentum of customer capture in
Retail Banking (+210,000 individual customers since the end of 2018
(+156,000 at the Regional Banks, +40,000 at LCL, +16,000 at CA
Italia);
- Strong performance of the automotive partnerships, generating
equity-accounted income;
- Commercial activity strong in capital markets, commercial
banking positions maintained in a slowing syndicated loan market in
the eurozone.
Very positive jaws effect (+340 bp) and
improvement in the cost/income ratio
- Underlying costs: +1.5% Q3/Q3, due in
particular to the development of international and corporate
insurance. Positive jaws effect in the Retail banking and Large
customer business lines. Costs stable in Specialised
financialsServices.
- Underlying cost/income ratio at 59.6% (-2.0
pp) in Q3, and 60.5% over 9M (-0.4 pp);
- Cost of risk low, at 29 bp, normalisation
in CIB, down at CACF and at CA Italia:
Financial strength confirmed this
quarter
-
CET1 ratio at 11.7%, +0.1 pp Sept/June,
risk-weighted assets stable in the business lines;
Continuing implementation of the 2022
Medium-Term Plan
- Increase in NPS8 in Retail banking, digital interaction
with customers strengthened, customer capture buoyant in France and
Italy (+210,000 individual customers since the end of
2018).
- Issuance of a non-preferred senior Green bond for €1
billion in October.
- Upgrade by Moody’s of Crédit Agricole S.A.’s
long-term credit rating to Aa3.
Crédit Agricole S.A.’s Board of Directors,
chaired by Dominique Lefebvre, met on 7 November 2019 to review the
financial statements for the third quarter and first nine months of
2019.
In the third quarter of 2019,
stated net income Group share reached
€1,199 million, versus €1,101 million in
the third quarter of 2018. The specific
items recorded this quarter generated a limited
negative net impact of -€28 million on net income Group
share. For the record, they had a limited negative impact
of -€32 million in the third quarter of 2018.
Excluding these specific items,
underlying net income Group share for the
third quarter of 2019 totalled to
€1,226 million, an increase of
+8.2% compared with the third quarter
of 2018.
Underlying earnings per share stood at
€0.34 in the third quarter of 2019, down
-6.3% compared with the third quarter
of 2018.
Crédit Agricole S.A. - Stated and underlying results,
Q3-19 and Q3-18
In €m |
Q3-19 stated |
Q3-18 stated |
Var Q3/Q3 stated |
Q3-19 underlying |
Q3-18 underlying |
Var Q3/Q3 underlying |
|
|
|
|
|
|
|
Revenues |
5,031 |
4,802 |
+4.8% |
5,073 |
4,834 |
+4.9% |
Operating expenses excl.SRF |
(3,025) |
(2,998) |
+0.9% |
(3,025) |
(2,979) |
+1.5% |
SRF |
(2) |
- |
n.m. |
(2) |
- |
n.m. |
Gross operating income |
2,004 |
1,804 |
+11.1% |
2,046 |
1,856 |
+10.3% |
Cost of risk |
(335) |
(218) |
+53.2% |
(335) |
(218) |
+53.2% |
Cost of legal risk |
- |
- |
n.m. |
- |
- |
n.m. |
Equity-accounted entities |
82 |
78 |
+5.1% |
82 |
78 |
+5.1% |
Net income on other assets |
17 |
(0) |
n.m. |
17 |
(0) |
n.m. |
Change in value of goodwill |
- |
- |
n.m. |
- |
- |
n.m. |
Income before tax |
1,769 |
1,663 |
+6.3% |
1,811 |
1,715 |
+5.6% |
Tax |
(423) |
(434) |
(2.5%) |
(437) |
(449) |
(2.7%) |
Net income from discont'd or
held-for-sale ope. |
0 |
(1) |
n.m. |
0 |
(1) |
n.m. |
Net income |
1,346 |
1,228 |
+9.6% |
1,374 |
1,265 |
+8.6% |
Non controlling interests |
(147) |
(128) |
+15.6% |
(148) |
(132) |
+12.1% |
Net income Group Share |
1,199 |
1,101 |
+8.9% |
1,226 |
1,133 |
+8.2% |
Earnings per share (€) |
0.33 |
0.35 |
(6.0%) |
0.34 |
0.36 |
(6.3%) |
Cost/Income ratio excl.SRF (%) |
60.1% |
62.4% |
-2.3 pp |
59.6% |
61.6% |
-2.0 pp |
Activity grew in the Crédit Agricole
S.A. business lines, despite a persistency difficult
interest rate environment.
The Crédit Agricole S.A. business lines and the
Crédit Agricole Group retail networks, in particular the
Regional Banks, which distribute the products and services of
Crédit Agricole S.A.’s business lines, again enjoyed
excellent activity levels this quarter, in lending,
customer savings and protection of assets and
individuals. Customer equipment increased, reflecting the potential
for organic growth through revenue synergies of the Group’s
Universal Customer-focused Banking model.
- In Savings/Retirement, premium income amounted
to €6.8 billion in the third quarter of 2019 (+13.9% compared
to the third quarter of 2018). As of 30 September 2019, net inflows
into retirement savings reached €2.4 billion, up +20% compared with
the third quarter of 2019. Unit-linked contract inflows increased
by 7.5% compared with the third quarter of 2018, to €1.3 billion
(54% of total net inflows, 29.2% of gross inflows). The share of UL
in outstandings reached 22.4%, a year-on-year increase of +0.7
percentage points. For several years, Crédit Agricole Assurances
has adapted its strategy to the low interest rate environment. It
has considerable flexibility to respond to this context: at
end-September 2019, the Policyholder Participation Reserve (PPE)
reached €10.8 billion (+€948 million compared with December
2018), representing 5.2% of outstanding euro contracts and a level
of coverage above the average for the French market. Crédit
Agricole Assurances is also adopting incentivising measures for UL
policies and a downward trend in policyholders’ profit-sharing.
- In Property and Casualty insurance,
Crédit Agricole Assurances continued to outperform the
French market, with premium growth of +6.8% in the third quarter of
2018, driven by continued strong growth in France (6.8%) and Italy
(+12% Q3/Q3). Crédit Agricole Assurances recorded a net
contribution of +148,000 contracts over the quarter, reaching
nearly 14.0 million contracts at end-September 2019. In the LCL
networks, the equipment rate for individual customers9 increased
(24.7% as at end-September 2019, an increase of +1.2 percentage
point since September 2018). Equipment rate also increased in the
Regional Banks (37.4% at end-September 2019, an increase of
+1.5 percentage point since September 2018). The combined
ratio was well managed at 95.5%, an improvement of 0.1 percentage
point year on year, despite the frost/hail and drought claims of
2019. In Death & disability/Creditor/Group, revenues reached
nearly €984 million in the third quarter of 2019, up +9.2% compared
with the same period in 2018, driven by growth in all three
business segments.
- Asset management (Amundi) recorded record net
inflows of €42.7 billion this quarter, driven by both medium- to
long-term assets (+€25.3 billion, thanks to the recovery in Retail
inflows, driven by the joint ventures and by third-party
distributors) and treasury products (+€17.4 billion, due to the
return of institutional and corporate customers).
Assets under management reached €1,563 billion at
end-September 2019, up +5.9% compared with end-September 2018,
despite continuing uncertainty in the global environment.
- Retail banking is still showing strong sales
momentum, with high rates of credit growth, particularly in France
for LCL (up +9.2% compared with end-September 2018), thanks to home
loans (+9.1%) and the small businesses and corporate markets
(+9.9%), but also in Italy for CA Italia (+3.1%), driven by loans
to individuals (+5.5%) and businesses (+6.1%). LCL’s inflows
increased year on year (+6.6%), driven by on-balance sheet deposits
(+10%, including +12.4% for passbooks and +10.7% for demand
deposits) but also by off-balance sheet deposits (+2%). In Italy,
inflows rose moderately (+1.9%), thanks to strong performance in
off-balance sheet deposits (+4.4%) against a backdrop of a
declining market, and to the stability of on-balance sheet
deposits. Net customer capture is still buoyant at LCL (+49,000
individual and SME and small business customers since the beginning
of the year, and +14,000 customers of LCL Essentiel since its
launch in April), and at CA Italia (+16,000 individual customers
since the beginning of the year). Equipment rates continued to
increase steadily, with growth of +7.7% in comprehensive
auto/home/health contracts and +4.7% in premium cards at LCL, and a
+22% increase in the number of property and casualty insurance
policies and +1.6 percentage point in the equipment rate at CA
Italia year on year.
- In the Specialised Financial Services
business line, CA Consumer Finance’s gross managed
loans increased by 5.4% compared with end-September 2018, to reach
€90.6 billion, driven by the Retail Banks of Crédit Agricole Group
(+6.8%) and the automotive partnerships (+6.7%). Production was
stable this quarter compared with the third quarter of 2018, at
€10.6 billion. CAL&F’s activity is buoyant, both in factoring
and in leasing. Business factoring production is at a good level,
particularly outside of France (€1.0 billion) and commercial
leasing production in France increased by +32% compared with the
third quarter of 2018.
- Activity in the Large Customers
business line is overall good, with revenues up in
the third quarter of 2019 (+6.3% compared with the third quarter of
2018) and over the first nine months of the year (+2.4%).
Underlying revenues from Capital markets and investment banking
(FICC) increased sharply (+21.6% compared with the third quarter of
2018), driven by strong commercial activity across almost all
product lines and the upturn in advisory transactions. Structured
finance recorded good performances this quarter (+5.9%), while
revenues in commercial banking were penalized (-9.9%) by a sluggish
environment with no major transactions (-25% year on year of
syndicated EMEA loans10). Nevertheless, the business line has
maintained its leading position in EMEA syndicated loans11. Lastly,
Asset servicing (CACEIS) posted record levels of assets under
custody (€3,144 billion, up +16.4% year on year) and assets under
administration (€2,023 billion, up +13.3% year on year) this
quarter, thanks to sustained activity on existing customers and to
the on-boarding of new customers.
In keeping with the strategy outlined at the
presentation of the Group’s Medium-Term Plan on 6 June 2019,
Amundi, CA Consumer Finance and CACEIS continued their policy
of non-Group partnerships in Europe and Asia this
quarter.
- The quarter saw the first consolidation of SoYou resulting from
the partnership signed between CA Consumer Finance and
Bankia on 7 March 2018. On 10 October
2019, the joint venture was approved by the Spanish Ministry of
Economy to operate as a financial credit institution.
- KAS Bank was consolidated in the CACEIS
financial statements as at 30 September 2019 following CACEIS’
friendly public takeover bid, launched on 26 July for all of the
share capital of KAS Bank. This confirmed CACEIS’ pan-European
ambitions by strengthening its position in the Netherlands and its
capabilities to serve the customer base of insurance companies and
pension funds; this acquisition will create value thanks to its
strong potential for synergies.
- On 19 July 2019, CACF also signed an agreement with
Fiat Chrysler Automobiles (FCA) to
extend their 50/50 joint venture until 31 December 2024.
Besides these operations, the following
transactions were announced since the beginning of
2019:
- On 17 April, Crédit Agricole S.A. and
Santander announced the merger of their custody
and asset servicing operations; after this merger,
Crédit Agricole S.A. and Santander would hold 69.5% and
30.5% respectively of this new entity, which will keep the name
“CACEIS” and combine the activities of CACEIS and
Santander Securities Services (“S3”) in Spain and Latin
America (Brazil, Mexico and Colombia). This new entity would
benefit from greater scale and stronger competitive positioning
thanks to an expanded geographical presence, making it better
placed to capture growth in high potential markets (Latin America
and Asia). The operation should be completed before the end of
2019.
- On 29 April, CACIB completed the disposal of a 4.9% stake in
Banque Saudi Fransi (BSF) to a
consortium headed by Ripplewood, thereby reducing its stake in
Banque Saudi Fransi to 10% and, subject to the exercise
of a warrant on 6% of the equity, to 4% by the
end of the year; the impact of this transaction was
booked in the second quarter directly in equity that may not be
reclassified.
- On 28 June 2019, CA Consumer Finance signed a final
agreement with Banco BPM (Italy’s
third-largest bank) to strengthen their global partnership,
expanding their commercial relationship to the entire Banco BPM
branch network, including the acquisition of Profamily’s banking
business, and extending it for 15 years.
- On 8 July, Crédit Agricole Assurances and
Abanca signed a partnership agreement to create a
non-life insurance company for the Spanish and Portuguese markets
over a 30-year period. The agreement provides for the creation of a
50/50-owned joint venture that will offer the market innovative
products based on technological solutions and a differentiated
customer experience. The alliance will combine Abanca’s knowledge
of the customer base with the expertise developed by Crédit
Agricole Assurances in the European insurance market. The European
Commission approved the creation of a joint venture on 28 October
2019.
Specific items in this quarter
are few in number and show a limited net negative effect of
-€28 million on net income Group share. They include
only recurring volatile accounting items, namely the DVA (Debt
Valuation Adjustment, i.e. gains and losses on financial
instruments related to changes in the Group’s issuer spread) for
‑€2 million in net income Group share and the loan book hedge for
-€1 million in the Large Customers business line, as well as the
provision for home purchase savings schemes for -€5 million and
-€20 million respectively in net income Group share in the French
Retail banking division and the Corporate Centre. In the third
quarter of 2018, specific items had a limited negative
net impact of -€32 million on net income Group share
and included the integration costs of Pioneer Investments at
Amundi in the amount of ‑€6 million (-€12 million before
tax and non-controlling interests), and those of the three Italian
banks for -€4 million (-€7 million before tax and
non-controlling interests), as well as a net balance of
-€23 million in net income Group share from recurring volatile
accounting items, namely the DVA in the amount of
-€6 million and hedging of the Large Customers loan book
for -€10 million and changes in provisions for home savings
schemes for -€7 million.
The business lines performed strongly in the
third quarter of 2019. Underlying net income Group
share of business lines12 increased by +6.8%, with
all business lines contributing to this increase. The
contribution from the Asset Gathering division increased by +2.5%
to €502 million, with net income Group share remaining solid for
insurance and Amundi. The Large Customers business line performed
well, particularly in capital markets, with an increase of net
income Group share by +12.8% to €478 million despite the reversal
of CIB’s cost of risk. Retail banking saw its contribution increase
by +6.0% to €251 million. Gross operating income continued to
perform well in Retail banking in France, and CA Italia posted a
sharp increase of +24.0% in its contribution. Strong performance of
the automotive partnerships in Specialised financial services
generated equity-accounted income (contribution up by +17.8%
between the third quarter of 2018 and the third quarter of
2019).
In the third quarter of 2019, underlying
revenues reached €5,073 million, up +4.9% thanks to
buoyant commercial activity and despite a persistently difficult
interest rate environment. This was mainly due to the strong
increase in revenues in the Asset Gathering division (+3.8%,
benefiting from record inflows for Amundi and from an
outperformance of the French market by the property and casualty
insurance activity), but also due to the performance of the Large
Customers business line (+6.3% due to the momentum in capital
markets banking, and to the maintenance of commercial banking
positions in a syndicated loan market experiencing a slowdown in
the eurozone). The underlying revenues of all the business lines
(excluding CC) increased by +3.1% this quarter.
These positive revenue trends were accompanied
by good cost control. Underlying operating
expenses excluding SRF showed a controlled increase of
+1.5% compared with the third quarter of 2018,
making it possible to achieve a very significantly positive
jaws effect of +340 basis points. Nevertheless, business
development continued in all the business lines, with expenses
rising by +2.9% between the third quarter of 2018 and the third
quarter of 2019. The Asset Gathering division in particular saw an
increase in expenses, reflecting the development of international
and corporate insurance. Retail Banking posted positive jaws
effects with 90 basis points for LCL and 140 basis points for
International Retail Banking, likewise the Large Customers
division, with 240 basis points. The Specialised financial services
division recorded stable expenses over the period. The
underlying cost/income ratio stood at 59.6%
for the third quarter of 2019, an improvement of 2
percentage points over the period.
Underlying gross operating
income was therefore up +10.3% compared
with the third quarter of 2018.
Cost of risk increased by
+53.2%/-€117 million, to -€335 million versus
‑€218 million in the third quarter of 2018, mainly due to
a reversal of the cost of credit risk in Corporate and Investment
Banking, which reported net reversals of provisions for +€52
million in the third quarter of 2018, while it reported net charges
of -€48 million (i.e., -€100 million differences) this
quarter. For the same reason, we are seeing a normalisation of the
cost of risk on outstandings13 for the third quarter of
2019. It stood at 29 basis points, up +4 basis points
versus the third quarter of 2018 and up +4 basis points versus the
previous quarter, but remained low. The other three business lines
that contributed the most to the cost of risk show contrasting
variations, albeit of very limited magnitude. LCL thus posted a
+15.5% increase in the cost of risk, to -€58 million, but its cost
of risk relative to outstandings remained low at 17 basis points
(+1 point versus the previous quarter). CA Italia declined
sharply, by -12.0%, with the cost of risk relative to outstandings
continuing to improve, rising to 59 basis points (from 73 basis
points in the third quarter of 2018 and 62 basis points in the
second quarter of 2019); lastly, CACF recorded a decline of -3.8%
to €121 million compared to the third quarter of 2018, with the
cost of risk relative to outstandings also falling to 120 basis
points.
The contribution of equity-accounted
entities increased sharply, by +5.1%, to
€82 million, reflecting in particular the strong performance
of CA Consumer Finance’s partnerships (+17.8% compared to the third
quarter of 2018).
Net income from other assets
was €17 million, as a result of a one-off
real estate transaction in Wealth management. Underlying
income14 before tax, discontinued operations and non-controlling
interests thus increased by +5.6% to €1,811 million. The
underlying effective tax rate was
25.3%, a fall by -2.2 percentage points compared
to the third quarter of 2018, in particular as a result of a
favourable decision on a tax dispute at Crédit Agricole CIB in the
third quarter of 2019. The underlying tax charge was therefore down
-2.7% to €437 million, and underlying net income
before minority interests was therefore up by +8.7%.
Net income attributable to
non-controlling interests increased by
+12.1% to €148 million, mainly in line with
the change in the underlying result.
Underlying
net income Group share increased by
+8.2% versus the third quarter of 2018, to
€1,226 million.
In the first nine months of
2019, stated net income Group share amounted to
€3,183 million, compared with €3,393 million in the first nine
months of 2018, a decrease of -6.2%.
Specific items in the first nine months
of 2019 had a negative impact of
-€81 million on stated net income Group
share. In addition to the third quarter items already mentioned
above, the first-half 2019 items had a negative impact of
-€20 million and also corresponded to the
recurring volatile accounting items, i.e. the DVA for -€3 million,
loan book hedges in the Large Customers division for
-€6 million, and changes in the Home Purchase Savings Plan for
-€12 million. Specific items in the first nine months
of 2018 had a positive impact of +€54 million on
net income Group share. Compared to the third quarter 2018
items already mentioned above, they had a positive impact of
+€87 million on net income Group share in first-half 2018,
i.e. the adjustment of negative goodwill recognised at the time of
acquisition of the three Italian banks totalling +€66 million,
‑€8 million for the costs of integrating
Pioneer Investments (-€18 million before tax and
non-controlling interests) as well as recurring specific items,
namely the DVA for +€11 million (+€15 million before tax)
and loan book hedges in the Large Customers division for
+€14 million (+€20 million before tax).
Excluding these specific items,
underlying net income Group share
reached €3,264 million, down
-2.2% compared to the first nine months of
2018.
Underlying earnings per share came to
€0.97, a decrease (-8.6%) compared to the
first nine months of 2018.
Annualised ROTE15 net of
coupons on Additional Tier 1 (return on equity Group share
excluding intangible assets) was 11.3% in
the first nine months of 2019, a decrease compared with
financial year 2018 (13.1%).
Crédit Agricole S.A. - Stated and underlying results,
9M-19 and 9M-18
In €m |
9M-19 stated |
9M-18 stated |
Var 9M/9M stated |
9M-19 underlying |
9M-18 underlying |
Var 9M/9M underlying |
|
|
|
|
|
|
|
Revenues |
15,034 |
14,882 |
+1.0% |
15,155 |
14,880 |
+1.8% |
Operating expenses excl.SRF |
(9,161) |
(9,073) |
+1.0% |
(9,161) |
(9,053) |
+1.2% |
SRF |
(340) |
(302) |
+12.5% |
(340) |
(302) |
+12.5% |
Gross operating income |
5,534 |
5,507 |
+0.5% |
5,654 |
5,525 |
+2.3% |
Cost of risk |
(917) |
(755) |
+21.4% |
(917) |
(755) |
+21.4% |
Cost of legal risk |
- |
(5) |
(100.0%) |
- |
- |
n.m. |
Equity-accounted entities |
275 |
248 |
+11.0% |
275 |
248 |
+11.0% |
Net income on other assets |
39 |
32 |
+21.8% |
39 |
32 |
+21.8% |
Change in value of goodwill |
- |
86 |
(100.0%) |
- |
- |
n.m. |
Income before tax |
4,931 |
5,113 |
(3.5%) |
5,052 |
5,050 |
+0.0% |
Tax |
(1,302) |
(1,244) |
+4.7% |
(1,340) |
(1,250) |
+7.2% |
Net income from discont'd or
held-for-sale ope. |
8 |
(3) |
n.m. |
8 |
(3) |
n.m. |
Net income |
3,637 |
3,866 |
(5.9%) |
3,720 |
3,797 |
(2.0%) |
Non controlling interests |
(454) |
(473) |
(4.1%) |
(455) |
(459) |
(0.7%) |
Net income Group Share |
3,183 |
3,393 |
(6.2%) |
3,264 |
3,338 |
(2.2%) |
Earnings per share (€) |
0.94 |
1.08 |
(12.8%) |
0.97 |
1.06 |
(8.6%) |
Cost/Income ratio excl.SRF (%) |
60.9% |
61.0% |
-0.0 pp |
60.5% |
60.8% |
-0.4 pp |
In the first nine months of 2019, business line
results were up +2.5%, thanks to good growth in activity,
controlled growth in expenses (positive jaws effect of +40 basis
points), and the maintenance of the cost of risk at a very low
level. The negative contribution of the Corporate Centre
(‑€683 million, compared with -€515 million in the first
nine months of 2018) resulted from a deterioration in the items for
this division other than “structural” net income, compared with a
high base in 2018.
Underlying revenues were
up +1.8% compared to the first nine months of
2018, with a positive contribution to this growth by all business
lines except Specialised financial services. The environment for
consumer finance is one of strong competitive pressure in France,
and the business line launched new partnerships (resulting in
customer capture costs) over the period. The very strong
performance of automotive partnerships is accounted for using the
equity method. Leasing and factoring saw their activity stabilise,
with strong momentum in leasing activity in particular. Revenues in
the Large Customers business line rose slightly (+2.4%).
Underlying operating expenses
increased slightly, by +1.2%, excluding SRF
contributions. This control of expenses led to a positive
jaws effect of +60 basis points over the period. In the
business lines alone, the increase in operating expenses excluding
SRF was +1.6%, concentrated mainly in the Asset Gathering and Large
Customers divisions, where expenses are rising in connection with
business development. The underlying cost/income ratio
excluding SRF was 60.5%, including
IFRIC21 expenses in the first quarter, an improvement of 0.4
percentage points compared to the third quarter of 2018.
Lastly, the cost of credit risk
showed an increase of +21.4%/-€162 million compared
to the first nine months of 2018, to -€917 million. This increase
is mainly due to the Large Customers business line (which reported
a risk charge of -€105 million at end-September 2019, compared to a
net reversal of +€38 million at end-September 2018) and financing
activities in particular, stemming from the one-off provisions
reported in the period.
At end-September 2019, Crédit Agricole S.A.
retains a high level of solvency, with a Common Equity Tier
1 (CET1) ratio16 of 11.7%, up 0.1 pp
from end-June 2019. Organic risk-weighted
assets in the business lines were stable (+€0.8 billion) in the
third quarter of 2019. Risk-weighted assets stood at €330
billion at end-September 2019, compared with €323 billion at
end-June, an increase of 2.1% over a quarter. Despite the stability
of risk-weighted assets in the business lines (+€0.8 billion), this
increase can be explained mainly by the increase in risk-weighted
assets related to unrealised gains and the inclusion of the
insurance companies’ results for the period (+€3.3 billion in
total), the impact of exchange rates (+€1.8 billion) and the
acquisition of Kas Bank by CACEIS (+€0.8 billion). For the record,
equity investments in insurance companies are weighted on the basis
of risk-weighted assets, up to 370% of the equity-accounted
value.
On CET1 ratio, capital generation over the
quarter (+17 basis points, including a dividend provision of €0.17
over the third quarter of 2019 and €0.47 over the nine-month
period) and the positive change in unrealised reserves (+8 basis
points) were offset by the impact of the increase of the insurance
results through the value of equity-accounted (-5 basis points).
The other impacts consist of and the effect of the acquisition of
Kas Bank by CACEIS (-3 basis points), a foreign exchange impact (-1
basis point) and the positive impact of the capital increase
reserved for employees (+5 basis points) on the CET1 of Crédit
Agricole S.A. this quarter.
The phased-in leverage ratio
was 4.3% at end-September 2019 as defined in the
Delegated Act adopted by the European Commission. The intra-quarter
average measure of phased-in leverage ratio17 stood at 4.0% in the
third quarter of 2019.
Crédit Agricole S.A.’s average LCR
(Liquidity Coverage Ratio) over 12 months stood at 131.7%18 at
end-September 2019, which is higher than the target level of around
110% set out in the Medium-Term Plan.
At the end of October 2019,
Crédit Agricole S.A. had completed 88% of its
medium-to-long-term market funding programme for the year.
The bank raised the equivalent of €15 billion, of which €8.7
billion equivalent of senior preferred debt and
secured senior debt, and €4.5 billion equivalent of
senior non-preferred debt and €1.8
billion equivalent of Tier 2 debt. The
2019 programme is set at €17 billion, including around
€5 to €6 billion of TLAC eligible debt (Tier 2
debt or senior non-preferred debt). Note that Crédit Agricole S.A.
made a Green senior non-preferred debt issue for €1 billion in
October 2019 (included in the amounts above).
* *
*
Philippe Brassac, Chief Executive Officer,
commented on the third quarter 2019 and first nine months 2019
results and activity of Crédit Agricole S.A. as follows: “The
results of Crédit Agricole S.A. rose sharply this quarter, to
+8.9%, as a result of buoyant commercial activity in all business
lines. As a consequence, the Group recorded 210,000 new customers
in France and Italy this year; our customer’s equipment rates
continue to rise, reflecting the Group’s potential for organic
growth, in particular through synergies between entities. Although
we are investing in the development of our businesses, and in
particular insurance, both internationally and for corporates, our
operational efficiency continues to improve, as evidenced by the
very significant jaws effect this quarter and the improvement in
the cost/income ratio. Our cost of risk, lastly, remains very low.
The rating agencies have recognised the strength of our model,
which is based on relational as well as operational excellence.
Moody’s raised CAsa’s medium-to-long-term rating to Aa3 this
quarter, given our Additional Tier 1 instruments an “investment
grade” status. Our financial solidity is confirmed this quarter:
the CET1 ratio of Crédit Agricole S.A. secures our dividend policy
and makes a first unwinding of the Switch possible in 2020.”
Crédit Agricole
Group
In the third quarter, underlying
net income Group share of Crédit Agricole Group was
€1,924 million, up +6.0% compared with the third quarter of
2018. In the first nine months of 2019 the underlying net
income Group share of Crédit Agricole Group reached €5,205 million,
stable compared with the first nine months of 2018.
This performance was achieved thanks to
very strong activity in all business lines and the implementation
of the customer project. Digital interaction with customers has
strengthened, with an increase of +2.5 percentage points in the use
of the Regional Banks’ MaBanque mobile app and +3 percentage points
in the use of the LCL mobile application since the beginning of the
year. The weight of online transactions increased by +6 percentage
points at CA Italia. Customer satisfaction improved in 2019, with a
positive individual customer NPS19 in the Regional Banks, compared
to the market average of -1 in France. There was a sharp rise in
the individual customer NPS in the Regional Banks (+5) and LCL
(+8). Customer relations are intensifying for the Regional Banks,
with an increase in the proportion of “active” DAVs20. There was
strong momentum in acquisition once again, with +210,000 additional
individual customers, including 156,000 for Regional Banks, 40,000
for LCL and 15,000 for CA Italia since the beginning of the year.
Since its launch a year ago, 342,000 customers of the Regional
Banks’ have been met in the context of “Trajectoires Patrimoine”.
Finally, customer equipment continues to grow, with a
+1.5 percentage point increase in property and casualty
insurance for the Regional Banks, 1.2 percentage point for LCL, and
1.6 percentage point for CA Italia.
The Regional Banks’ revenues were stable
in the third quarter of 2019 compared with the third quarter of
2018, thanks to a good level of growth in fee and commission income
(+3.4%), particularly in banking and insurance. Expenses were up
+3.4% in the third quarter of 2019 compared with the third quarter
of 2018, mainly due to IT investments, but underlying net income
Group share was up sharply over the period (+2.7%), notably due to
the significant decrease in the cost of risk in third quarter 2019,
compared to a third quarter 2018 which was impacted by collective
provisions.
The Group’s underlying revenues reached
8,331 million euros in the third quarter of 2019, up +2.9%
year on year, reflecting the strength of the Universal
Customer-focused Banking model, stable and diversified, and which
generates organic growth in all the business lines, thanks in
particular to revenue synergies between specialised business lines
and distribution networks. Operating expenses excluding SRF are
well controlled (+2.7% increase in third quarter 2019), while
incorporating IT investments in the Regional Banks and investments
to develop Casa’s business lines, especially in the Asset Gathering
business line. A positive year-on-year jaws effect of 20 basis
points is recorded. The cost/income ratio improved by 0.1
percentage points compared with the third quarter of 2018, reaching
62.7% this quarter, reflecting the Group’s high level of
operational efficiency.
The Regional Banks’ cost of credit risk
relative to outstandings remained stable, at 12 basis points, with
the NPL ratio at 2.0% and NPL coverage ratio at 97.3%. The Group’s
cost of credit risk increased by +18.9% compared with the third
quarter of 2018 as a result of the reversal of the cost of risk in
CIB, but remained very low, and the NPL coverage ratio reached
83.5%.
The Group’s Common Equity Tier 1 ratio
was 15.5% at end-September 2019, an increase of 0.1 percentage
points compared with end-June 2019, and 580 basis points above
the required regulatory level21.
Finally, the Group is continuing to roll
out its social project, with the issuance in October of a
non-preferred senior Green bond of €1 billion.
In the third quarter
of 2019, Crédit Agricole Group’s
stated net income Group share was
€1,849 million, versus €1,769 million in
the third quarter of 2018. The specific items
recorded this quarter generated a negative net impact of
-€76 million on net income Group share.
Excluding these specific items,
underlying net income Group share22 was
€1,924 million, up +6.0% compared with the
third quarter of 2018.
Credit Agricole Group - Stated and underlying results,
Q3-19 and Q3-18
In €m |
Q3-19 stated |
Q3-18 stated |
Var Q3/Q3 stated |
Q3-19 underlying |
Q3-18 underlying |
Var Q3/Q3 underlying |
|
|
|
|
|
|
|
Revenues |
8,216 |
8,043 |
+2.2% |
8,331 |
8,097 |
+2.9% |
Operating expenses excl.SRF |
(5,220) |
(5,102) |
+2.3% |
(5,220) |
(5,083) |
+2.7% |
SRF |
- |
- |
n.m. |
- |
- |
n.m. |
Gross operating income |
2,997 |
2,940 |
+1.9% |
3,111 |
3,014 |
+3.2% |
Cost of risk |
(384) |
(323) |
+18.9% |
(384) |
(323) |
+18.9% |
Cost of legal risk |
- |
- |
n.m. |
- |
- |
n.m. |
Equity-accounted entities |
85 |
77 |
+10.0% |
85 |
77 |
+10.0% |
Net income on other assets |
18 |
2 |
x
10.8 |
18 |
2 |
x
10.8 |
Change in value of goodwill |
- |
- |
n.m. |
- |
- |
n.m. |
Income before tax |
2,715 |
2,696 |
+0.7% |
2,830 |
2,770 |
+2.2% |
Tax |
(748) |
(816) |
(8.4%) |
(787) |
(839) |
(6.2%) |
Net income from discont'd or held-for-sale
ope. |
0 |
(1) |
n.m. |
0 |
(1) |
n.m. |
Net income |
1,968 |
1,879 |
+4.7% |
2,043 |
1,930 |
+5.9% |
Non controlling interests |
(119) |
(110) |
+7.9% |
(119) |
(115) |
+3.8% |
Net income Group Share |
1,849 |
1,769 |
+4.5% |
1,924 |
1,815 |
+6.0% |
Cost/Income ratio excl.SRF (%) |
63.5% |
63.4% |
+0.1 pp |
62.7% |
62.8% |
-0.1 pp |
In the third quarter of 2019, underlying
revenues increased by +2.9% compared with
the third quarter of 2018, to €8,331 million, and by
+1.8% for the business lines excluding the
Corporate Centre. This growth was driven by revenues from the Asset
gathering business line, which increased by +3.1%,
International Retail banking, which were up +4.4%, and Large
customers, which rose +6.2%. Revenues in the Specialised financial
services business lines fell by -2.7%, but the handsome performance
by automotive partnerships was accounted for using the equity
method. Revenues from French Retail banking were stable, up
+0.2%.
Underlying operating expenses excluding
SRF contribution were up +2.7% compared
with the third quarter of 2018, in connection with IT investments
in the Regional Banks under the Medium-Term Plan, and development
expenses in the Crédit Agricole S.A. business lines, especially
Asset Gathering. The underlying cost/income ratio excluding
SRF stood at 62.7%, an improvement of
0.1 percentage points compared with the third
quarter of 2018.
Underlying gross operating
income including the contribution to the SRF increased to
€3,111 million compared with the third quarter of 2018 (+3.2%).
The cost of credit risk rose by
+18.9% to -€384 million, versus -€323 million in the
third quarter of 2018. This increase stems in particular from
the Large customers business line, where the cost of credit risk is
normalising, with net provisions of -€45 million, compared with net
reversals of +€57 million in the third quarter of 2018. Crédit
Agricole Group’s cost of risk relative to
outstandings23 was 20 basis points, up +2
basis points from the third quarter of 2018, but low and below the
Medium-Term Plan assumption of 25 basis points.
By incorporating the contribution from
equity-accounted entities, which was up by +10.0% from €77 million
to €85 million as a result of the strong performance of
automotive partnerships at CACF, underlying pre-tax income
was €2,830 million, up +2.2% compared with the third
quarter of 2018.
The underlying tax charge was down
-6.2% compared with the third quarter of 2018, showing a
sharp fall of +2.5 percentage points in the underlying tax
rate, from 31.1% to 28.7%. Accordingly,
underlying net income before
non-controlling interests was up +5.9% and underlying net
income Group share was up +6.0% compared with the third quarter of
2018.
Specific items had a net
negative impact of ‑€76 million on net income Group share this
quarter. These included only the net balance of recurring volatile
accounting items 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 -€2 million, hedges on
the Large Customers loan book for -€1 million, and the
change in the provision for home purchase savings schemes
in the amount of -€72 million. In the third quarter of
2018, specific items negatively impacted net income Group
share by -€46 million, including ‑€6 million in integration costs
for Pioneer Investments (-€12 million before tax and minority
interests), -€3 million from the integration
costs for the three Italian banks (-€7 million before tax and
minority interests), and, finally, -€37 million from the net
balance in net income Group share of recurring volatile accounting
items, i.e. the DVA for -€6 million and the loan book hedges in the
Large Customers division for -€10 million, and the changes in
provisions for home savings plans for -€21 million.
In the first nine months of
2019, underlying net income Group share
was stable (-0.3%) compared with the same period
in 2019, at €5,205 million, a slight fall of
-€19 million. The increase in the cost of credit risk (-€122
million) due to the normalisation of the cost of risk in corporate
and investment banking and the increase in the tax charge (-€141
million) offsetting the good growth in gross operating income
(+€163 million).
Underlying net revenues
increased by +1.8% and operating expenses
excluding Single Resolution Funds (SRF) remained under
tight control, at +1.6%. The Group therefore
recorded a positive jaws effect of +20 basis
points over the first nine months of the year.
Credit Agricole Group - Stated and underlying results,
9M-19 and 9M-18
In €m |
9M-19 stated |
9M-18 stated |
Var 9M/9M stated |
9M-19 underlying |
9M-18 underlying |
Var 9M/9M underlying |
|
|
|
|
|
|
|
Revenues |
24,898 |
24,729 |
+0.7% |
25,188 |
24,748 |
+1.8% |
Operating expenses excl.SRF |
(15,805) |
(15,586) |
+1.4% |
(15,805) |
(15,565) |
+1.5% |
SRF |
(426) |
(389) |
+9.4% |
(426) |
(389) |
+9.4% |
Gross operating income |
8,667 |
8,754 |
(1.0%) |
8,957 |
8,794 |
+1.9% |
Cost of risk |
(1,263) |
(1,141) |
+10.7% |
(1,263) |
(1,141) |
+10.7% |
Cost of legal risk |
- |
(5) |
(100.0%) |
- |
- |
n.m. |
Equity-accounted entities |
273 |
256 |
+6.8% |
273 |
256 |
+6.8% |
Net income on other assets |
21 |
39 |
(46.6%) |
21 |
39 |
(46.6%) |
Change in value of goodwill |
- |
86 |
(100.0%) |
- |
- |
n.m. |
Income before tax |
7,698 |
7,989 |
(3.6%) |
7,989 |
7,948 |
+0.5% |
Tax |
(2,323) |
(2,317) |
+0.3% |
(2,420) |
(2,331) |
+3.8% |
Net income from discont'd or
held-for-sale ope. |
8 |
(3) |
n.m. |
8 |
(3) |
n.m. |
Net income |
5,383 |
5,669 |
(5.0%) |
5,577 |
5,614 |
(0.7%) |
Non controlling interests |
(372) |
(395) |
(5.9%) |
(372) |
(390) |
(4.7%) |
Net income Group Share |
5,012 |
5,273 |
(5.0%) |
5,205 |
5,224 |
(0.3%) |
Cost/Income ratio excl.SRF (%) |
63.5% |
63.0% |
+0.5 pp |
62.7% |
62.9% |
-0.1 pp |
At end-September 2019, customer
capture in the Regional Banks was still buoyant,
with +156,000 additional individual customers since the start of
the year. Since the launch of “Trajectoires Patrimoine” a year ago,
342,000 customers have been met. In line with the Group Project,
the Regional Banks are participating in the roll-out of the
Customer Project. The customer relation is increasingly
digitalised. Since the beginning of the year, we have seen a +2.5
pp increase in the number of users of the Regional Banks’
“MaBanque” application, as well as an increase in the number of
customer contacts (+1 pp) in the Regional Banks. Customer
satisfaction is up in all customer segments. The individual
customers’ Net Promoter Score (NPS24) in particular is up sharply
in 2019 (+5 versus 2018), and has become positive, while the
average for the French market is -1. The momentum in the commercial
development of the Regional Banks significantly contributed to
growth in Crédit Agricole S.A.’s business lines, of which
the Regional Banks, the leading retail banking network in France,
are the prime partners in Retail Banking, demonstrating the
strength of the Group’s Universal Customer-focused Banking model.
Customer equipment continues to increase: the inventory of premium
cards for individual customers rose +8.7% between September
2018 and September 2019, and property and personal insurance
policies increased by +4.4% over the same period.
Outstanding loans grew
+6.7% compared with 30 September 2019. This growth
was driven by home loans (+7.5%), consumer finance (+6.8%), and
corporate loans (+6.9%).
Customer savings rose
+4.6% year on year, driven by on-balance sheet
deposits (+6.0%) and, in particular, demand deposits (+10.1%) and
passbook accounts (+11.2%). Off-balance sheet savings rose more
modestly by +2.4% year on year, driven by life insurance assets
(+4.4%).
The Regional Banks’ contribution to
Crédit Agricole Group’s underlying net income
Group share was €689 million, up
+2.7% compared with the third quarter
of 2018. At €3,244 million, underlying
revenues remain stable (+0.1%) compared with the
third quarter of 2018. This relative stability is mainly due to a
good level of growth in fee and commission income, up +3.4% year on
year (mainly due to banking services and insurance products),
offsetting the pressure on interest income (-2.7% in the third
quarter of 2019 compared with the third quarter of 2018).
Operating expenses (excluding
SRF) were up +3.4% compared with the
third quarter of 2018, corresponding mainly to continuing IT
investments under the Group’s Medium-Term Plan. As a result, the
underlying cost/income ratio excluding SRF was 66.2%.
Cost of risk recorded a
significant decrease in the third quarter of 2019 to -€48 million,
compared with the third quarter of 2018 (-€111 million), when
collective provisions had been recorded. It represents 12 basis
points on the basis of outstandings25. The NPL ratio stabilised at
2.0% and the NPL coverage ratio stands at 97.3%
Over the first nine months, the
contribution of the Regional Banks to underlying net income
Group share was €1,917 million, an
increase of +2.7%.
The performance of the other
Crédit Agricole Group business lines is described in
detail in the section of this press release on
Crédit Agricole S.A.
Over the quarter,
Crédit Agricole Group’s financial strength remained
robust, with a Common Equity Tier 1 (CET1) ratio26 of
15.5%, up by
+0.1 percentage points compared with
end-June 2019. This ratio provides a substantial buffer of 580
basis points in relation to the SREP requirement applicable to
Crédit Agricole Group, set at 9.7% by the ECB.
The MREL ratio was estimated at 32% of
risk-weighted assets (RWA) at 30 September 2019, and stood at 22.2%
excluding eligible preferred senior debt. The target under
the Crédit Agricole Group’s Medium-Term Plan is to achieve a
subordinated MREL ratio (excluding potentially eligible preferred
senior debt) of 24-25% of RWA by 2022. Expressed as a
percentage of the institution’s total liabilities and own funds,
after certain prudential restatements (Total Liabilities Own Funds
– TLOF), the MREL ratio stood at 8.5% at 30 September 2019,
excluding eligible preferred senior debt. This is in line
with the Medium-Term Plan target of maintaining this ratio above 8%
of TLOF, a level which would enable recourse to the Single
Resolution Fund, subject to the decision of the Resolution
Authority.
The TLAC ratio requirements have been
applicable since 27 June 2019, when European Regulation
CRR2 (Capital Requirement Regulation 2) came into force. At
30 September 2019, the Crédit Agricole Group’s TLAC ratio stood at
22.2% of RWA and 7.6% of leverage risk exposure (LRE), excluding
eligible preferred senior debt. It was down 50 basis
points compared with 30 June 2019, mainly due to the increase in
risk-weighted assets, the withdrawal from Tier 1 instruments and
the deduction of the Tier 2 issued by CAA. The level is still well
above the CRR2/CRDV requirements27, by 2.5 percentage points for
RWA and 1.6 percentage points for LRE respectively.
The phased-in leverage ratio
came to 5.6% at end-September 2019.
The liquidity position of Crédit Agricole Group
is solid. The Group’s banking cash balance sheet, at
€1,289 billion at 30 September 2019, showed a surplus
of stable funding sources over stable assets of
€118 billion, up by €2.1 billion compared to
end-June 2019, and in line with the target under the
Medium-Term Plan (over €100 billion). The surplus of
stable resources finances the HQLA (High Quality Liquid Assets)
securities portfolio generated by the LCR (Liquidity Coverage
Ratio) requirement for customer or customer-related activities.
These securities (€110 billion) covered more than
three times the short-term debt net of Central Bank
deposits.
The liquidity reserves, which
include capital gains and haircuts on securities portfolios,
stood at €272 billion at 30 September 2019.
The Group’s average LCR ratio over 12 months stood at 129.4%28 at
end-September 2019, exceeding the Medium-Term Plan target of around
110%.
At end-September 2019, the Group’s main
issuers raised the equivalent of €28.9 billion in
medium/long-term debt on the markets, 45% of which was
issued by Crédit Agricole S.A. In addition,
€3.2 billion was placed in Crédit Agricole Group’s Retail
banks (Regional Banks, LCL and CA Italia) and other external
networks, as well as with supranational organisations at
end-September 2019.
* *
*
Dominique Lefebvre, Chairman of SAS Rue La
Boétie and Chairman of Crédit Agricole S.A.’s Board of
Directors, commented on the Group’s third quarter 2019 and first
nine months 2019 results and activity as follows: “Over the first
nine months of the year, the business lines of Crédit Agricole
Group continued to expand, both in France and internationally. In
line with our purpose, formulated when we presented our Medium-Term
Plan in June, customer satisfaction is improving in all segments,
and the Strategic Recommendation Index for the Regional Banks is
above the French market in 2019. As a result of these efforts, all
activity indicators are green in our businesses. We are also
consolidating our position as world leader in this area, with a €1
billion Green bond issue in October. The three pillars of our
unique relationship model, namely excellence in customer relations,
empowered teams for customers, and commitment to society, create
value in the uncertain economic environment we are
experiencing”.
Corporate social and
environmental
responsibility
of
the Company
Green bonds
In October 2019, in line with the Group Project,
Crédit Agricole S.A. issued a Green senior non-preferred bond for
€1 billion.
Sustainable finance
As part of its leadership in green bonds, CACIB
has developed a platform for sovereign issuers around the world. In
this respect, CACIB was the Structuring Advisor for the historic $1
billion issuance in Hong Kong in May 2019. This issuance is
financing sustainable projects, such as the development of
energy-saving technologies or the construction of energy-efficient
buildings. In addition, CACIB assisted Chile in July 2019 with the
launch of its first green bond, for €861 million. This is the first
euro issuance for a non-European sovereign issuer.
In September 2019, Unifergie and CACIB jointly
arranged France’s largest-ever refinancing operation in renewable
energy, and particularly in solar energy, with a new operation
(Phoenix 5) of more than €800 million for Tenergie. Tenergie is the
second-largest independent producer of solar power in France, with
more than 800 power plants and 500 MWh of installed capacity.
Unifergie, LCL and the Alpes Provence Regional Bank have assisted
Tenergie since it was founded in 2008 and CACIB has already been
involved in the €262 million refinancing of Phoenix 3 in 2018.
Since the end of 2017, Tenergie has also been associated with CA
Pyrénées Gascogne Énergies Nouvelles, part of Terre d’Énergies, an
investment vehicle created for a strategic partnership in energy
transition. The loans are refinancing 166 photovoltaic power plants
and two wind farms for a total capacity of 255 MWh, supplying
110,000 households. Crédit Agricole Group has underwritten fifty
per cent of the transaction, through CACIB’s underwriting
capability and the involvement of LCL, 11 Regional Banks and
Bpifrance.
The Group’s CSR commitments
Introduced on 22 September at the United Nations
General Assembly, the Principles for Responsible Banking define the
responsibilities of banks, as well as their obligations in terms of
monitoring and publishing responsible finance objectives. Crédit
Agricole S.A. has signed up to these principles, as well as the
United Nations’ Collective Commitment to Climate Action, which sets
out practical, binding measures that banks must take to strengthen
their contributions to green finance. By signing up to the
principles, Crédit Agricole S.A. has reaffirmed its determination
to continue with efforts to promote a more inclusive economy and
its intention to make green finance one of the Group’s keys to
growth.
On 31 July, Philippe Brassac, Chief Executive
Officer of Crédit Agricole S.A., and Christy Hoffman, Secretary
General of UNI Global Union (international federation of trade
unions for the services private sector) signed an international
framework agreement to provide all Group employees with the same
benefits, regardless of the country in which they work. This global
agreement covers human rights, fundamental labour rights and the
development of social dialogue. This agreement includes several
commitments pertaining to disability (in providing that each entity
has an action plan for the integration of disabled workers),
parenthood (in establishing the principle of 16 weeks’ paid
maternity leave) and death & disability (it plans to carry out
an inventory of all the provident schemes in force in the Group’s
entities).
Inclusive finance
In September 2018, in partnership with CA
Indosuez Wealth (Asset Management) and CACEIS Bank, Luxembourg
Branch, the Fondation Grameen Crédit Agricole launched FIR
(“Finance Inclusive en milieu Rural”, Inclusive Finance Funds in
Rural Areas), a sub-fund of Fonds Grameen Crédit Agricole and
Crédit Agricole Group’s first microfinance fund. In 2018, fifteen
Regional Banks, Crédit Agricole Assurances and Amundi invested
nearly €8 million in the sub-fund. At the last fundraising round in
June 2019, five new Regional Banks confirmed their investment for
an amount of €1.6 million.
Moreover, Crédit Agricole Group invested
€300 million in a fundraising campaign for Crédit Agricole
Régions Développement (CARD). This strengthens its role with
mid-cap companies in the regions and complements the system already
put in place by the Regional Banks through their SCIR (Regional
Private Equity Companies) subsidiaries.
Appendix 1 – Specific items, Crédit Agricole
S.A. and Crédit Agricole
Group
Crédit Agricole S.A. - Specific items, Q3-19 et Q3-18,
9M-19 et 9M-18
|
|
Q3-19 |
Q3-18 |
|
9M-19 |
9M-18 |
In €m |
|
Gros impact* |
Impact on Net income |
Gros impact* |
Impact on Net income |
|
Gros impact* |
Impact on Net income |
Gros impact* |
Impact on Net income |
DVA (LC) |
|
(3) |
(2) |
(8) |
(6) |
|
(15) |
(11) |
8 |
5 |
Loan
portfolio hedges (LC) |
|
(1) |
(1) |
(14) |
(10) |
|
(28) |
(20) |
6 |
4 |
Home
Purchase Savings Plans (FRB) |
|
(8) |
(5) |
(2) |
(1) |
|
(19) |
(12) |
(2) |
(1) |
Home
Purchase Savings Plans (CC) |
|
(30) |
(20) |
(9) |
(6) |
|
(58) |
(38) |
(9) |
(6) |
Total impact on revenues |
|
(43) |
(28) |
(33) |
(23) |
|
(120) |
(81) |
2 |
3 |
Pioneer integration costs (AG) |
|
- |
- |
(12) |
(6) |
|
- |
- |
(30) |
(14) |
3
Italian banks integration costs (IRB) |
|
- |
- |
(7) |
(4) |
|
- |
- |
9 |
5 |
Total impact on operating expenses |
|
- |
- |
(19) |
(10) |
|
- |
- |
(21) |
(10) |
ECB
fine (CC) |
|
- |
- |
- |
- |
|
- |
- |
(5) |
(5) |
Total impact Non-allocated legal risk
provisions |
|
- |
- |
- |
- |
|
- |
- |
(5) |
(5) |
Change
of value of goodwill (CC) |
|
- |
- |
- |
- |
|
- |
- |
86 |
66 |
Total impact on change of value of goodwill |
|
- |
- |
- |
- |
|
- |
- |
86 |
66 |
Total
impact of specific items |
|
(43) |
(28) |
(52) |
(32) |
|
(120) |
(81) |
62 |
54 |
Asset
gathering |
|
- |
- |
(12) |
(6) |
|
- |
- |
(30) |
(14) |
French
Retail banking |
|
(8) |
(5) |
(2) |
(1) |
|
(19) |
(12) |
(2) |
(1) |
International Retail banking |
|
- |
- |
(7) |
(4) |
|
- |
- |
9 |
5 |
Specialised financial services |
|
- |
- |
- |
- |
|
- |
- |
- |
- |
Large
customers |
|
(4) |
(3) |
(21) |
(16) |
|
(43) |
(31) |
13 |
10 |
Corporate
centre |
|
(30) |
(20) |
(9) |
(6) |
|
(58) |
(38) |
72 |
55 |
* Impact before tax and before minority
interests |
|
|
|
|
|
|
|
|
|
|
Crédit Agricole Group - Specific items, Q3-19 et Q3-18,
9M-19 et 9M-18
|
|
Q3-19 |
Q3-18 |
|
9M-19 |
9M-18 |
In €m |
|
Gros impact* |
Impact on Net income |
Gros impact* |
Impact on Net income |
|
Gros impact* |
Impact on Net income |
Gros impact* |
Impact on Net income |
|
|
|
|
|
|
|
|
|
|
|
DVA (LC) |
|
(3) |
(2) |
(8) |
(6) |
|
(15) |
(11) |
8 |
6 |
Loan
portfolio hedges (LC) |
|
(1) |
(1) |
(14) |
(10) |
|
(28) |
(21) |
6 |
5 |
Home
Purchase Savings Plans (LCL) |
|
(8) |
(5) |
(2) |
(1) |
|
(19) |
(13) |
(2) |
(1) |
Home
Purchase Savings Plans (CC) |
|
(30) |
(20) |
(9) |
(6) |
|
(58) |
(38) |
(9) |
(6) |
Home
Purchase Savings Plans (RB) |
|
(72) |
(47) |
(22) |
(14) |
|
(170) |
(111) |
(22) |
(14) |
|
|
|
|
|
|
|
|
|
|
|
Total impact on revenues |
|
(115) |
(76) |
(54) |
(37) |
|
(290) |
(194) |
(19) |
(11) |
|
|
|
|
|
|
|
|
|
|
|
Pioneer integration costs (AG) |
|
- |
- |
(12) |
(6) |
|
- |
- |
(30) |
(14) |
Integration costs 3 Italian banks (IRB) |
|
- |
- |
(7) |
(3) |
|
- |
- |
9 |
6 |
|
|
|
|
|
|
|
|
|
|
|
Total impact on operating expenses |
|
- |
- |
(19) |
(9) |
|
- |
- |
(21) |
(8) |
|
|
|
|
|
|
|
|
|
|
|
ECB fine (CC) |
|
- |
- |
- |
- |
|
- |
- |
(5) |
(5) |
|
|
|
|
|
|
|
|
|
|
|
Total impact Non-allocated legal risk
provisions |
|
- |
- |
- |
- |
|
- |
- |
(5) |
(5) |
|
|
|
|
|
|
|
|
|
|
|
Change
of value of goodwill (CC) |
|
- |
- |
- |
- |
|
- |
- |
86 |
74 |
|
|
|
|
|
|
|
|
|
|
|
Total impact on change of value of goodwill |
|
- |
- |
- |
- |
|
- |
- |
86 |
74 |
|
|
|
|
|
|
|
|
|
|
|
Total impact of specific
items |
|
(115) |
(76) |
(74) |
(46) |
|
(290) |
(194) |
41 |
50 |
Asset gathering |
|
- |
- |
(12) |
(6) |
|
- |
- |
(30) |
(14) |
French Retail banking |
|
(80) |
(53) |
(24) |
(15) |
|
(189) |
(124) |
(24) |
(15) |
International Retail banking |
|
- |
- |
(7) |
(3) |
|
- |
- |
9 |
6 |
Specialised financial services |
|
- |
- |
- |
- |
|
- |
- |
- |
- |
Large customers |
|
(4) |
(3) |
(21) |
(16) |
|
(43) |
(32) |
13 |
10 |
Corporate centre |
|
(30) |
(20) |
(9) |
(6) |
|
(58) |
(38) |
72 |
63 |
* Impact before tax and before minority
interests
Appendix 2 – Crédit Agricole S.A.: Stated and
underlying detailed income statement
Crédit Agricole S.A. - From stated to underlying
results, Q3-19 and Q3-18
In €m |
Q3-19 stated |
Specific items |
Q3-19 underlying |
Q3-18 stated |
Specific items |
Q3-18 underlying |
Q3/Q3 stated |
Q3/Q3 underlying |
|
|
|
|
|
|
|
|
|
Revenues |
5,031 |
(43) |
5,073 |
4,802 |
(33) |
4,834 |
+4.8% |
+4.9% |
Operating expenses excl.SRF |
(3,025) |
- |
(3,025) |
(2,998) |
(19) |
(2,979) |
+0.9% |
+1.5% |
SRF |
(2) |
- |
(2) |
- |
- |
- |
n.m. |
n.m. |
Gross operating income |
2,004 |
(43) |
2,046 |
1,804 |
(52) |
1,856 |
+11.1% |
+10.3% |
Cost of risk |
(335) |
- |
(335) |
(218) |
- |
(218) |
+53.2% |
+53.2% |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
Equity-accounted entities |
82 |
- |
82 |
78 |
- |
78 |
+5.1% |
+5.1% |
Net income on other assets |
17 |
- |
17 |
(0) |
- |
(0) |
n.m. |
n.m. |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
Income before tax |
1,769 |
(43) |
1,811 |
1,663 |
(52) |
1,715 |
+6.3% |
+5.6% |
Tax |
(423) |
14 |
(437) |
(434) |
15 |
(449) |
(2.5%) |
(2.7%) |
Net income from discont'd or
held-for-sale ope. |
0 |
- |
0 |
(1) |
- |
(1) |
n.m. |
n.m. |
Net income |
1,346 |
(28) |
1,374 |
1,228 |
(37) |
1,265 |
+9.6% |
+8.6% |
Non controlling interests |
(147) |
0 |
(148) |
(128) |
4 |
(132) |
+15.6% |
+12.1% |
Net income Group Share |
1,199 |
(28) |
1,226 |
1,101 |
(32) |
1,133 |
+8.9% |
+8.2% |
Earnings per share (€) |
0.33 |
(0.01) |
0.34 |
0.35 |
(0.01) |
0.36 |
(6.0%) |
(6.3%) |
Cost/Income ratio excl. SRF (%) |
60.1% |
|
59.6% |
62.4% |
|
61.6% |
-2.3 pp |
-2.0 pp |
|
|
|
|
|
|
|
|
|
Net income Group Share excl. SRF |
1,201 |
(28) |
1,229 |
1,101 |
(32) |
1,133 |
+9.1% |
+8.5% |
Crédit Agricole S.A. - From stated to underlying
results, 9M-19 and 9M-18
In €m |
9M-19 stated |
Specific items |
9M-19 underlying |
9M-18 stated |
Specific items |
9M-18 underlying |
9M/9M stated |
9M/9M underlying |
|
|
|
|
|
|
|
|
|
Revenues |
15,034 |
(120) |
15,155 |
14,882 |
2 |
14,880 |
+1.0% |
+1.8% |
Operating expenses excl.SRF |
(9,161) |
- |
(9,161) |
(9,073) |
(21) |
(9,053) |
+1.0% |
+1.2% |
SRF |
(340) |
- |
(340) |
(302) |
- |
(302) |
+12.5% |
+12.5% |
Gross operating income |
5,534 |
(120) |
5,654 |
5,507 |
(18) |
5,525 |
+0.5% |
+2.3% |
Cost of risk |
(917) |
- |
(917) |
(755) |
- |
(755) |
+21.4% |
+21.4% |
Cost of legal risk |
- |
- |
- |
(5) |
(5) |
- |
(100.0%) |
n.m. |
Equity-accounted entities |
275 |
- |
275 |
248 |
- |
248 |
+11.0% |
+11.0% |
Net income on other assets |
39 |
- |
39 |
32 |
- |
32 |
+21.8% |
+21.8% |
Change in value of goodwill |
- |
- |
- |
86 |
86 |
- |
(100.0%) |
n.m. |
Income before tax |
4,931 |
(120) |
5,052 |
5,113 |
62 |
5,050 |
(3.5%) |
+0.0% |
Tax |
(1,302) |
38 |
(1,340) |
(1,244) |
6 |
(1,250) |
+4.7% |
+7.2% |
Net income from discont'd or
held-for-sale ope. |
8 |
- |
8 |
(3) |
- |
(3) |
n.m. |
n.m. |
Net income |
3,637 |
(83) |
3,720 |
3,866 |
69 |
3,797 |
(5.9%) |
(2.0%) |
Non controlling interests |
(454) |
1 |
(455) |
(473) |
(15) |
(459) |
(4.1%) |
(0.7%) |
Net income Group Share |
3,183 |
(81) |
3,264 |
3,393 |
54 |
3,338 |
(6.2%) |
(2.2%) |
Earnings per share (€) |
0.94 |
(0.03) |
0.97 |
1.08 |
0.02 |
1.06 |
(12.8%) |
(8.6%) |
Cost/Income ratio excl.SRF (%) |
60.9% |
|
60.5% |
61.0% |
|
60.8% |
-0.0 pp |
-0.4 pp |
|
|
|
|
|
|
|
|
|
Net income Group Share excl. SRF |
3,498 |
(81) |
3,579 |
3,679 |
54 |
3,625 |
(4.9%) |
(1.3%) |
Appendix 3 – Crédit Agricole S.A.:
Results by business line
Crédit Agricole S.A.: Contribution by business line -
Q3-19 & Q3-18
Q3-19 (stated) |
€m |
AG |
FRB (LCL) |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
Revenues |
1,507 |
858 |
692 |
676 |
1,397 |
(100) |
5,031 |
Operating expenses excl. SRF |
(706) |
(576) |
(422) |
(341) |
(803) |
(176) |
(3,025) |
SRF |
- |
- |
- |
- |
- |
(2) |
(2) |
Gross operating income |
801 |
282 |
270 |
335 |
594 |
(278) |
2,004 |
Cost of risk |
(11) |
(58) |
(84) |
(131) |
(45) |
(5) |
(335) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
8 |
- |
- |
74 |
2 |
(2) |
82 |
Net income on other assets |
21 |
(0) |
(0) |
(0) |
(3) |
0 |
17 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
819 |
224 |
186 |
278 |
547 |
(285) |
1,769 |
Tax |
(238) |
(68) |
(54) |
(56) |
(63) |
56 |
(423) |
Net income from discontinued or
held-for-sale operations |
0 |
- |
- |
- |
- |
- |
0 |
Net income |
581 |
156 |
132 |
222 |
485 |
(229) |
1,346 |
Non controlling interests |
(79) |
(7) |
(35) |
(21) |
(10) |
4 |
(147) |
Net income Group Share |
502 |
149 |
97 |
201 |
475 |
(225) |
1,199 |
Q3-18 (stated) |
€m |
AG |
FRB (LCL) |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
Revenues |
1,452 |
858 |
662 |
695 |
1,297 |
(162) |
4,802 |
Operating expenses excl. SRF |
(680) |
(578) |
(417) |
(339) |
(773) |
(212) |
(2,998) |
SRF |
- |
- |
- |
- |
- |
- |
- |
Gross operating income |
772 |
280 |
245 |
356 |
524 |
(374) |
1,804 |
Cost of risk |
14 |
(50) |
(95) |
(141) |
57 |
(2) |
(218) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
12 |
- |
- |
63 |
1 |
2 |
78 |
Net income on other assets |
(2) |
0 |
0 |
1 |
1 |
(0) |
(0) |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
796 |
231 |
150 |
279 |
582 |
(375) |
1,663 |
Tax |
(242) |
(68) |
(45) |
(63) |
(166) |
151 |
(434) |
Net income from discontinued or
held-for-sale operations |
(1) |
- |
- |
(0) |
- |
- |
(1) |
Net income |
554 |
162 |
106 |
215 |
416 |
(224) |
1,228 |
Non controlling interests |
(70) |
(7) |
(29) |
(24) |
(8) |
11 |
(128) |
Net income Group Share |
484 |
155 |
77 |
190 |
408 |
(213) |
1,101 |
Crédit Agricole S.A. : Contribution by business line -
9M-19 & 9M-18
9M-19 (stated) |
€m |
AG |
FRB (LCL) |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
Revenues |
4,455 |
2,605 |
2,083 |
2,044 |
4,203 |
(356) |
15,034 |
Operating expenses excl. SRF |
(2,150) |
(1,742) |
(1,278) |
(1,012) |
(2,419) |
(560) |
(9,161) |
SRF |
(7) |
(32) |
(22) |
(18) |
(177) |
(83) |
(340) |
Gross operating income |
2,298 |
832 |
783 |
1,013 |
1,607 |
(999) |
5,534 |
Cost of risk |
(14) |
(153) |
(256) |
(370) |
(105) |
(19) |
(917) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
32 |
- |
- |
231 |
1 |
11 |
275 |
Net income on other assets |
20 |
1 |
(1) |
1 |
(1) |
20 |
39 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
2,337 |
680 |
526 |
874 |
1,502 |
(987) |
4,931 |
Tax |
(658) |
(221) |
(151) |
(193) |
(340) |
261 |
(1,302) |
Net income from discontinued or
held-for-sale operations |
8 |
- |
- |
- |
- |
- |
8 |
Net income |
1,687 |
458 |
375 |
681 |
1,162 |
(726) |
3,637 |
Non controlling interests |
(237) |
(21) |
(101) |
(79) |
(23) |
5 |
(454) |
Net income Group Share |
1,451 |
438 |
274 |
602 |
1,139 |
(721) |
3,183 |
9M-18 (stated) |
€m |
AG |
FRB (LCL) |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
Revenues |
4,308 |
2,592 |
2,028 |
2,078 |
4,158 |
(281) |
14,882 |
Operating expenses excl. SRF |
(2,109) |
(1,766) |
(1,249) |
(1,006) |
(2,356) |
(586) |
(9,073) |
SRF |
(3) |
(28) |
(22) |
(18) |
(170) |
(62) |
(302) |
Gross operating income |
2,195 |
798 |
757 |
1,054 |
1,633 |
(930) |
5,507 |
Cost of risk |
5 |
(157) |
(274) |
(368) |
38 |
1 |
(755) |
Cost of legal risk |
- |
- |
- |
- |
- |
(5) |
(5) |
Equity-accounted entities |
38 |
- |
- |
190 |
2 |
19 |
248 |
Net income on other assets |
(2) |
3 |
0 |
1 |
14 |
16 |
32 |
Change in value of goodwill |
- |
- |
- |
- |
- |
86 |
86 |
Income before tax |
2,236 |
643 |
483 |
877 |
1,686 |
(812) |
5,113 |
Tax |
(599) |
(201) |
(146) |
(204) |
(472) |
377 |
(1,244) |
Net income from discontinued or
held-for-sale operations |
(1) |
(1) |
- |
(0) |
- |
- |
(3) |
Net income |
1,635 |
441 |
338 |
673 |
1,215 |
(435) |
3,866 |
Non controlling interests |
(225) |
(20) |
(93) |
(88) |
(23) |
(24) |
(473) |
Net income Group Share |
1,410 |
422 |
245 |
585 |
1,191 |
(460) |
3,393 |
Appendix 4 – Crédit Agricole Group:
Stated and underlying detailed income
statement
Crédit Agricole Group - Stated and underlying results,
Q3-19 and Q3-18
In €m |
Q3-19 stated |
Specific items |
Q3-19 underlying |
Q3-18 stated |
Specific items |
Q3-18 underlying |
Q3/Q3 stated |
Q3/Q3 underlying |
|
|
|
|
|
|
|
|
|
Revenues |
8,216 |
(115) |
8,331 |
8,043 |
(54) |
8,097 |
+2.2% |
+2.9% |
Operating expenses excl.SRF |
(5,220) |
- |
(5,220) |
(5,102) |
(19) |
(5,083) |
+2.3% |
+2.7% |
SRF |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
Gross operating income |
2,997 |
(115) |
3,111 |
2,940 |
(74) |
3,014 |
+1.9% |
+3.2% |
Cost of risk |
(384) |
- |
(384) |
(323) |
- |
(323) |
+18.9% |
+18.9% |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
Equity-accounted entities |
85 |
- |
85 |
77 |
- |
77 |
+10.0% |
+10.0% |
Net income on other assets |
18 |
- |
18 |
2 |
- |
2 |
x
10.8 |
x
10.8 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
n.m. |
n.m. |
Income before tax |
2,715 |
(115) |
2,830 |
2,696 |
(74) |
2,770 |
+0.7% |
+2.2% |
Tax |
(748) |
39 |
(787) |
(816) |
23 |
(839) |
(8.4%) |
(6.2%) |
Net income from discont'd or
held-for-sale ope. |
0 |
- |
0 |
(1) |
- |
(1) |
n.m. |
n.m. |
Net income |
1,968 |
(76) |
2,043 |
1,879 |
(51) |
1,930 |
+4.7% |
+5.9% |
Non controlling interests |
(119) |
- |
(119) |
(110) |
4 |
(115) |
+7.9% |
+3.8% |
Net income Group Share |
1,849 |
(76) |
1,924 |
1,769 |
(46) |
1,815 |
+4.5% |
+6.0% |
Cost/Income ratio excl.SRF (%) |
63.5% |
|
62.7% |
63.4% |
|
62.8% |
+0.1 pp |
-0.1 pp |
|
|
|
|
|
|
|
|
|
Net income Group Share excl. SRF |
1,849 |
(76) |
1,924 |
1,769 |
(46) |
1,815 |
+4.5% |
+6.0% |
Crédit Agricole Group - Stated and underlying results,
9M-19 and 9M-18
In €m |
9M-19 stated |
Specific items |
9M-19 underlying |
9M-18 stated |
Specific items |
9M-18 underlying |
9M/9M
stated |
9M/9M underlying |
|
|
|
|
|
|
|
|
|
Revenues |
24,898 |
(290) |
25,188 |
24,729 |
(19) |
24,748 |
+0.7% |
+1.8% |
Operating expenses excl.SRF |
(15,805) |
- |
(15,805) |
(15,586) |
(21) |
(15,565) |
+1.4% |
+1.5% |
SRF |
(426) |
- |
(426) |
(389) |
- |
(389) |
+9.4% |
+9.4% |
Gross operating income |
8,667 |
(290) |
8,957 |
8,754 |
(40) |
8,794 |
(1.0%) |
+1.9% |
Cost of risk |
(1,263) |
- |
(1,263) |
(1,141) |
- |
(1,141) |
+10.7% |
+10.7% |
Cost of legal risk |
- |
- |
- |
(5) |
(5) |
- |
(100.0%) |
n.m. |
Equity-accounted entities |
273 |
- |
273 |
256 |
- |
256 |
+6.8% |
+6.8% |
Net income on other assets |
21 |
- |
21 |
39 |
- |
39 |
(46.6%) |
(46.6%) |
Change in value of goodwill |
- |
- |
- |
86 |
86 |
- |
(100.0%) |
n.m. |
Income before tax |
7,698 |
(290) |
7,989 |
7,989 |
41 |
7,948 |
(3.6%) |
+0.5% |
Tax |
(2,323) |
96 |
(2,420) |
(2,317) |
14 |
(2,331) |
+0.3% |
+3.8% |
Net income from discont'd or
held-for-sale ope. |
8 |
- |
8 |
(3) |
- |
(3) |
n.m. |
n.m. |
Net income |
5,383 |
(194) |
5,577 |
5,669 |
55 |
5,614 |
(5.0%) |
(0.7%) |
Non controlling interests |
(372) |
- |
(372) |
(395) |
(5) |
(390) |
(5.9%) |
(4.7%) |
Net income Group Share |
5,012 |
(194) |
5,205 |
5,273 |
50 |
5,224 |
(5.0%) |
(0.3%) |
Cost/Income ratio excl.SRF (%) |
63.5% |
|
62.7% |
63.0% |
|
62.9% |
+0.5 pp |
-0.1 pp |
|
|
|
|
|
|
|
|
|
Net income Group Share excl. SRF |
5,417 |
(194) |
5,611 |
5,650 |
50 |
5,600 |
(4.1%) |
+0.2% |
Appendix 5 – Crédit Agricole Group:
Results by business line
Crédit Agricole Group: Contribution by business line -
Q3-2019 & Q3-2018
|
Q3-19 (stated) |
€m |
RB |
LCL |
IRB |
AG |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
3,172 |
858 |
717 |
1,499 |
676 |
1,397 |
(103) |
8,216 |
Operating expenses excl. SRF |
(2,147) |
(576) |
(441) |
(706) |
(341) |
(803) |
(205) |
(5,220) |
SRF |
2 |
- |
- |
- |
- |
- |
(2) |
- |
Gross operating income |
1,028 |
282 |
276 |
793 |
335 |
594 |
(310) |
2,997 |
Cost of risk |
(48) |
(58) |
(85) |
(11) |
(131) |
(45) |
(6) |
(384) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
0 |
- |
- |
8 |
74 |
2 |
- |
85 |
Net income on other assets |
1 |
(0) |
(0) |
21 |
(0) |
(3) |
0 |
18 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
981 |
224 |
190 |
810 |
278 |
547 |
(316) |
2,715 |
Tax |
(340) |
(68) |
(54) |
(235) |
(56) |
(63) |
69 |
(748) |
Net income from discont'd or
held-for-sale ope. |
- |
- |
- |
0 |
- |
- |
- |
0 |
Net income |
641 |
156 |
136 |
575 |
222 |
484 |
(247) |
1,968 |
Non controlling interests |
(0) |
(0) |
(28) |
(75) |
(21) |
0 |
5 |
(119) |
Net income Group Share |
641 |
156 |
109 |
500 |
201 |
485 |
(242) |
1,849 |
|
Q3-18 (stated) |
|
€m |
RB |
LCL |
AG |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
3,220 |
858 |
1,453 |
687 |
695 |
1,298 |
(169) |
8,043 |
Operating expenses excl. SRF |
(2,077) |
(578) |
(680) |
(433) |
(339) |
(773) |
(223) |
(5,102) |
SRF |
- |
- |
- |
- |
- |
- |
- |
- |
Gross operating income |
1,144 |
280 |
773 |
254 |
356 |
525 |
(391) |
2,940 |
Cost of risk |
(104) |
(50) |
14 |
(96) |
(141) |
57 |
(2) |
(323) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
1 |
- |
12 |
- |
63 |
1 |
- |
77 |
Net income on other assets |
2 |
0 |
(2) |
0 |
1 |
1 |
(0) |
2 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
1,042 |
231 |
797 |
158 |
279 |
584 |
(394) |
2,696 |
Tax |
(385) |
(68) |
(242) |
(46) |
(63) |
(167) |
156 |
(816) |
Net income from discont'd or
held-for-sale ope. |
- |
- |
(1) |
- |
(0) |
- |
- |
(1) |
Net income |
656 |
162 |
555 |
112 |
215 |
417 |
(238) |
1,879 |
Non controlling interests |
0 |
(1) |
(66) |
(24) |
(24) |
0 |
4 |
(110) |
Net income Group Share |
657 |
161 |
489 |
88 |
190 |
417 |
(233) |
1,769 |
Crédit Agricole Group. : Contribution by business line -
stated - 9M-19 & 9M-18
|
9M-19 (stated) |
€m |
RB |
LCL |
IRB |
AG |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
9,841 |
2,605 |
2,158 |
4,439 |
2,044 |
4,200 |
(390) |
24,898 |
Operating expenses excl. SRF |
(6,560) |
(1,742) |
(1,335) |
(2,150) |
(1,012) |
(2,419) |
(586) |
(15,805) |
SRF |
(86) |
(32) |
(22) |
(7) |
(18) |
(177) |
(83) |
(426) |
Gross operating income |
3,195 |
832 |
801 |
2,281 |
1,013 |
1,605 |
(1,060) |
8,667 |
Cost of risk |
(342) |
(153) |
(260) |
(14) |
(370) |
(105) |
(19) |
(1,263) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
- |
- |
Equity-accounted entities |
9 |
- |
- |
32 |
231 |
1 |
- |
273 |
Net income on other assets |
(6) |
1 |
(1) |
20 |
1 |
(1) |
8 |
21 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
- |
- |
Income before tax |
2,855 |
679 |
540 |
2,320 |
874 |
1,500 |
(1,071) |
7,698 |
Tax |
(1,050) |
(221) |
(153) |
(654) |
(193) |
(340) |
287 |
(2,323) |
Net income from discontinued or
held-for-sale operations |
- |
- |
- |
8 |
- |
- |
- |
8 |
Net income |
1,806 |
458 |
387 |
1,675 |
681 |
1,160 |
(784) |
5,383 |
Non controlling interests |
(0) |
(0) |
(81) |
(224) |
(79) |
1 |
12 |
(372) |
Net income Group Share |
1,805 |
458 |
307 |
1,450 |
602 |
1,161 |
(772) |
5,012 |
|
9M-18 (stated) |
€m |
RB |
LCL |
AG |
IRB |
SFS |
LC |
CC |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
9,805 |
2,592 |
4,301 |
2,104 |
2,078 |
4,160 |
(311) |
24,729 |
Operating expenses excl. SRF |
(6,421) |
(1,766) |
(2,109) |
(1,302) |
(1,006) |
(2,356) |
(624) |
(15,586) |
SRF |
(87) |
(28) |
(3) |
(22) |
(18) |
(170) |
(62) |
(389) |
Gross operating income |
3,297 |
797 |
2,189 |
780 |
1,054 |
1,634 |
(998) |
8,754 |
Cost of risk |
(384) |
(157) |
5 |
(275) |
(368) |
38 |
0 |
(1,141) |
Cost of legal risk |
- |
- |
- |
- |
- |
- |
(5) |
(5) |
Equity-accounted entities |
8 |
- |
38 |
- |
190 |
2 |
19 |
256 |
Net income on other assets |
7 |
3 |
(2) |
0 |
1 |
14 |
16 |
39 |
Change in value of goodwill |
- |
- |
- |
- |
- |
- |
86 |
86 |
Income before tax |
2,928 |
643 |
2,229 |
506 |
877 |
1,688 |
(881) |
7,989 |
Tax |
(1,076) |
(201) |
(598) |
(151) |
(204) |
(472) |
384 |
(2,317) |
Net income from discontinued or
held-for-sale operations |
- |
(1) |
(1) |
- |
(0) |
- |
- |
(3) |
Net income |
1,852 |
441 |
1,630 |
355 |
673 |
1,216 |
(497) |
5,669 |
Non controlling interests |
(0) |
(0) |
(214) |
(75) |
(88) |
1 |
(19) |
(395) |
Net income Group Share |
1,852 |
441 |
1,416 |
280 |
585 |
1,217 |
(517) |
5,273 |
Appendix 6 – Method used to calculate earnings
per share, net assets per share and ROTE
Crédit Agricole S.A. - data per share
(in
€m) |
|
Q3-19 |
Q3-18 |
|
9M-19 |
9M-18 |
|
Q3/Q3 |
9M/9M |
Net income
Group share - stated |
|
1,199 |
1,101 |
|
3,183 |
3,393 |
|
+8.9% |
-6.2% |
- Interests on AT1, including issuance
costs, before tax |
|
(242) |
(91) |
|
(482) |
(316) |
|
x
2.7 |
+52.5% |
NIGS attributable to ordinary shares - stated |
[A] |
956 |
1,009 |
|
2,701 |
3,077 |
|
-5.3% |
-12.2% |
Average
number shares in issue, excluding treasury shares (m) |
[B] |
2,882.4 |
2,858.4 |
|
2,870.0 |
2,850.6 |
|
+0.8% |
+0.7% |
Net earnings per share - stated |
[A]/[B] |
0.33 € |
0.35 € |
|
0.94 € |
1.08 € |
|
-6.0% |
-12.8% |
Underlying net income Group share (NIGS) |
|
1,226 |
1,133 |
|
3,264 |
3,338 |
|
+8.2% |
-2.2% |
Underlying NIGS attributable to ordinary
shares |
[C] |
984 |
1,042 |
|
2,782 |
3,022 |
|
-5.5% |
-7.9% |
Net earnings per share - underlying |
[C]/[B] |
0.34 € |
0.36 € |
|
0.97 € |
1.06 € |
|
-6.3% |
-8.6% |
(in
€m) |
|
30/09/2019 |
30/09/2018 |
Shareholder's equity Group share |
|
62,287 |
57,995 |
- AT1 issuances |
|
(5,134) |
(5,011) |
- Unrealised gains and losses on OCI -
Group share |
|
(3,576) |
(2,299) |
-
Payout assumption on annual results* |
|
- |
- |
Net book value (NBV), not revaluated, attributable to
ordin. sh. |
[D] |
53,577 |
50,734 |
-
Goodwill & intangibles** - Group share |
|
(18,391) |
(17,774) |
Tangible NBV (TNBV), not revaluated attrib. to ordinary
sh. |
[E] |
35,186 |
32,961 |
Total
shares in issue, excluding treasury shares (period end, m) |
[F] |
2,882.8 |
2,863.6 |
NBV per share , after deduction of dividend to pay
(€) |
[D]/[F] |
18.6 € |
17.7 € |
+ Dividend to pay (€) |
[H] |
0.0 € |
0.00 € |
NBV per share , before deduction of dividend to pay
(€) |
|
18.6 € |
17.7 € |
TNBV per share, after deduction of dividend to pay
(€) |
[G]=[E]/[F] |
12.2 € |
11.5 € |
TNBV per sh., before deduct. of divid. to pay
(€) |
[G]+[H] |
12.2 € |
11.5 € |
(in
€m) |
|
|
9M-19 |
9M-18 |
Net income Group share attributable to ordinary shares |
[H] |
|
3,638 |
4,083 |
Tangible NBV (TNBV), not revaluated attrib. to ord. sh. -
avg*** |
[J] |
|
33,059 |
30,674 |
Stated ROTE (%) |
[H]/[J] |
|
11.0% |
13.3% |
Underlying Net income attrib. to ord. shares (annualised) |
[I] |
|
3,746 |
4,011 |
Underlying ROTE (%) |
[I]/[J] |
|
11.3% |
13.1% |
*** including
assumption of dividend for the current exercise |
|
|
|
|
Warning
Financial information on Crédit Agricole
S.A. and Crédit Agricole Group for the third quarter and first nine
months of 2019 comprises this presentation and the attached press
release and quarterly financial report which are available on the
website at
https://www.credit-agricole.com/en/finance/finance/financial-publications.
This presentation may include prospective
information on the Group, supplied as information on trends. This
data does not represent forecasts within the meaning of European
Regulation 809/2004 of 29 April 2004 (Chapter 1, Article 2,
paragraph 10).
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 nine-month period
ending 30 September 2019 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
Crédit Agricole S.A. and Crédit Agricole Group have not
changed materially since the Crédit Agricole S.A. 2018
Registration Document and its 2018 A.01 update (including all
regulatory information about Crédit Agricole Group) were filed with
the AMF (French Financial Markets Authority).
The sum of values contained in the tables and
analyses may differ slightly from the total reported due to
rounding.
The income statements contained in this report
show non-controlling interests with a minus sign such that the
“net income Group share” line item is the
mathematical addition of the “net income” line item and the
“non-controlling interests” line item.
Since 3 May 2018, Banca Leonardo
has been included in the scope of consolidation of
Crédit Agricole Group as a subsidiary of
Indosuez Wealth Management. Historical data have not been
restated on a proforma basis.
Since 30 September 2019, Kas Bank has been
included in the scope of consolidation of Crédit Agricole
Group as a subsidiary of CACEIS. SoYou has also been included in
the scope of consolidation as a joint-venture with between Crédit
Agricole Consumer Finance and Bankia. Historical data have not been
restated on a proforma basis.
Financial calendar
14 February 2020
Publication of fourth quarter and full year 2019
results 6 May 2020
Publication of first quarter
2020 results13 May 2020
General Meeting in
Paris 6 August 2020
Publication of second quarter and first half-year
2020 results4 November
2020
Publication of third quarter and first nine months 2020
results
Contacts
CRÉDIT AGRICOLE PRESS
CONTACTS
Charlotte de
Chavagnac + 33 1 57
72 11
17
charlotte.dechavagnac@credit-agricole-sa.frOlivier
Tassain
+ 33 1 43 23 25
41
olivier.tassain@credit-agricole-sa.frCaroline de
Cassagne
+ 33 1 49 53 41
72
caroline.decassagne@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) |
credit-agricole-sa@relations-actionnaires.com |
|
|
|
Clotilde
L’Angevin |
+ 33 1 43 23 32
45 |
clotilde.langevin@credit-agricole-sa.fr |
Equity
investors: |
|
|
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 |
Emilie
Gasnier |
+ 33 1 43 23 15
67 |
emilie.gasnier@credit-agricole-sa.fr |
Ibrahima
Konaté |
+ 33 1 43 23 51
35 |
ibrahima.konate@credit-agricole-sa.fr |
Vincent
Liscia |
+ 33 1 57 72 38
48 |
vincent.liscia@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 |
Marie-Laure
Malo |
+ 33 1 43 23 10
21 |
marielaure.malo@credit-agricole-sa.fr |
Rhita Alami
Hassani |
+ 33 1 43 23 15
27 |
rhita.alamihassani@credit-agricole-sa.fr |
|
|
|
|
|
|
|
|
|
|
|
|
See all our press releases at: www.credit-agricole.com –
www.creditagricole.info
1 In this press release, the term “underlying” refers to
intermediary balances adjusted for the specific items described on
p.17 and onwards
2 Net income Group share
3 Underlying, excluding specific items, see p. 17 onwards for
more details on specific items and p. 27 for the calculation of the
ROTE
4 Contribution to the Single Resolution Fund (SRF)
5 Average over last four rolling quarters, annualised
6 Based on the 9.7% SREP requirement (including countercyclical
buffer)
7 See calculation of ROTE p. 27; annualised rate calculated
without restating IFRIC21 charges, taking into account AT1 coupons
deducted directly from Group net equity; RONE of the divisions and
business lines calculated using the same method
8 Net Promotor score, calculated by Institut BVA (H1-2019)
and corresponding to the gap between promoters and detractors.
9 Equipment rate: percentage of individual banking clients
holding at least one insurance product (Pacifica estimates). Scope:
auto, home, health, life accidents and legal protection
insurance.
10 Thomson Reuters on the EMEA zone
11 Source: Refinitiv
12 Excluding the Corporate Centre.
13 Average loan loss reserves over the last four rolling
quarters, annualised
14 See p. 16 for more details on specific items related to
Crédit Agricole S.A.
15 See details on the calculation of the business lines’ ROTE
(return on tangible equity) and RONE (return on normalised equity)
on p. 27.
16 Including retained earnings for the first nine months of
2019
17 Intra-quarter leverage refers to the average of the end of
month exposures for the first two months of said quarter.
18 The ratio’s numerator and denominator stand at
€185.1 billion and €140.5 billion, respectively, for
Crédit Agricole S.A.
19 Customer recommendation index, calculated by an independent
organisation, Institut BVA (H1-2019) and corresponding to the gap
between promoters and detractors.
20 Increase in active DAVs and transactional DAVs (+120
transactions/month) as a proportion of DAVs, scope of major
individual customers
21 According to pro forma SREP requirement for 2019 of 9.7% as
notified by the ECB (incl. countercyclical buffer)
22 Underlying, excluding specific items. See p.16 onwards for
more details on specific items.
23 Average loan loss reserves over the last four rolling
quarters, annualised
24 Net Promotor score, calculated by Institut BVA (H1-2019)
and corresponding to the gap between promoters and detractors.
25 Relative to consolidated outstandings, calculated on an
average annualised basis over four rolling quarters.
26 Including first nine months of 2019
retained earnings
27 With the entry into force of CRR2, the Crédit Agricole Group
must meet the following TLAC requirements at all times: 16% of
risk-weighted assets, plus the combined buffer requirement
according to CRDV (including a 2.5% capital conservation buffer, a
1% systemic buffer and a 0.19% countercyclical buffer at 30
September 2019); and 6% of leverage risk exposure.
28 The ratio’s numerator and denominator stand at
€219.4 billion and €169.6 billion, respectively, for CA
Group
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