BPCE - 2019 Universal Registration Document

ACTIVITIES AND FINANCIAL INFORMATIONS 2019

GROUPE BPCE FINANCIAL DATA

INCOME BEFORE TAX At €1.4 billion, Groupe BPCE’s cost of risk increased by 5.2% compared to 2018. Divided by customer loan outstandings, Groupe BPCE’s cost of risk in basis points hit an average annual low of 20bp (19bp excluding non-recurring items). The rate of non-performing loans to gross outstandings was 2.7% at December 31, 2019, a decrease in relation to 2018. The coverage rate for non-performing loans, including collateral on impaired loan outstandings, came to 74.8% at December 31, 2019 versus 74.5% at December 31, 2018. Over full-year 2019, the cost of risk was low in retail banking (19bp for the Banque Populaire network and 15bp for the Caisse d’Epargne network). However, the cost of risk increased for Corporate & Investment Banking (49bp in 2019). The share in net income of associates and gains or losses on other assets show a decrease of €18 million and €14 million respectively. The change in the value of goodwill was -€84 million in 2019, of which -€82 million in goodwill impairment on Fidor Bank AG. NET INCOME ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT The Group’s income tax totaled €1,801 million, an increase of 21.9% compared to 2018. This increase is primarily attributable to the impairment and use of deferred tax assets on tax losses and the 2018 comparison base. Net income attributable to equity holders of the parent was stable in relation to 2018 at €3.0 billion. Groupe BPCE generated solid earnings thanks to its diversified universal banking model. SOLVENCY The Common Equity Tier 1 ratio was 15.7% at December 31, 2019 versus 15.8% at December 31, 2018. Several non-recurring items impacted the Common Equity Tier 1 ratio in 2019: the implementation of IFRS 16 (-5 basis points); • the deduction, at the instruction of the supervisory authority, • of the portion of SRF and FGDR (deposit insurance and resolution fund) comprising irrevocable payment commitments (-14 basis points);

the integration of the Factoring, Sureties & Guarantees, • Leasing, Consumer Finance and Securities Services business lines by BPCE SA (-20 basis points); the impact of the methodology used to calculate risk-weighted • assets linked to the speculative financing of real estate assets (-17 basis points); the acquisition by BPCE SA of 50.1% of Oney Bank (-12 basis • points). Moreover, the change in the Common Equity Tier 1 ratio over 2019 can be attributed to: the increase in Common Equity Tier 1 capital, driven in • particular by earnings taken to reserves (+74 basis points) and cooperative share inflows (+39 basis points); the increase in risk-weighted assets related to the activity • (-74 basis points). At 15.7%, Groupe BPCE’s Common Equity Tier 1 ratio at December 31, 2019 was significantly higher than the ECB’s minimum requirement, as defined by the European Central Bank (ECB) during the 2019 Supervisory Review and Evaluation Process (SREP). The total capital ratio stood at 18.8% at December 31, 2019, i.e. above the ECB’s minimum requirement. TLAC (Total Loss Absorbing Capacity) totaled €98.2 billion at end-December 2019. The pro forma TLAC ratio was 23.3% at December 31, 2019 versus 22.5% at December 31, 2018 and a target of 21.5% for early 2019, as defined in the TEC 2020 strategic plan. The leverage ratio came out at 5.3% at December 31, 2019 versus 5.2% at December 31, 2018. LIQUIDITY Groupe BPCE’s total liquidity reserves amounted to €231 billion at December 31, 2019, including €96 billion in available assets eligible for central bank funding, €66 billion in LCR-eligible assets and €69 billion in liquid assets placed with central banks. Short-term funding increased from €107 billion at December 31, 2018 to €127 billion at December 31, 2019. At December 31, 2019, Groupe BPCE’s total liquidity reserves covered 155% of all short-term funding as well as short-term maturities of MLT debt ( versus 160% at end-2018). The Liquidity Coverage Ratio (LCR) was once again above 110% at December 31, 2019.

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The Group’s business lines 4.3.2

The Group has three core businesses: Retail Banking and Insurance, which includes:

Retail Securities Services (formerly housed in the Specialized Financial Services (SFS) sub-division), in addition to Socfim, CFI and Pramex (formerly in Other networks); Insurance, a Natixis business line serving the Groupe BPCE • networks and their customers; Payments, which offers a full range of payment and prepaid • solutions to local businesses, online and via mobile devices, and which is becoming a business line in its own right; the Other networks, which include Oney Bank and Banque • Palatine.

the Banque Populaire network, comprised of 14 Banques • Populaires and their subsidiaries, Crédit Maritime Mutuel, and the Mutual Guarantee Companies; the Caisse d’Epargne network, consisting of the 15 Caisses • d’Epargne; Financial Solutions and Expertise, a sub-division encompassing • the specialized financing activities: Factoring, Leasing, Consumer Finance, Sureties & Financial Guarantees, and

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UNIVERSAL REGISTRATION DOCUMENT 2019 | GROUPE BPCE

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