BPCE - 2020 Universal Registration Document

ACTIVITIES AND FINANCIAL INFORMATIONS 2020

GROUPE BPCE FINANCIAL DATA

Asset &Wealth Management 4.3.5

Asset & Wealth Management

Chg. 2020/2019

2020

2019

€m

%

in millions of euros

Net banking income Operating expenses

3,225

3,760

(535)

(14.2%) (4.2%) (33.9%) 7.8 pts

(2,387)

(2,492) 1,268 66.3%

104

Gross operating income

838

(430)

Cost/income ratio

74.0%

--

Cost of risk

(27)

(8)

(19)

N/S

Share in income of equity-accounted associates

1

1

0

50.1%

(45) 768

13

(57)

N/S

Gains or losses on other assets

Income before tax

1,273

(506)

(39.7%)

Revenues in the Asset & Wealth Management division were down by 13.4% compared to the full-year 2019 at constant exchange rates (-14.2% at current exchange rates), to €3.2 billion. Expenses decreased by 3.2% at constant exchange rates (-4.2% at current exchange rates) and amounted to €2.4 billion. Gross operating income fell by 33.4% at constant exchange rates (-33.9% at current exchange rates) to €0.8 billion. ASSET MANAGEMENT Assets under management stood at €1,135.5 billion at the end of December 2020, an increase of 22% at current exchange rates (+27% at constant exchange rates) versus December 31, 2019, underpinned by a very positive scope effect (+€177.7 billion) mainly due to LBPAM contributions, the market effect (+€58.9 billion), and net inflows (+5.1 billion), partly offset by a negative foreign exchange effect (-€40.3 billion).

Private Equity companies reported net inflows of €2.7 billion; • the Europe region recorded net outflows of €2.6 billion, with • net inflows at Mirova (+€5.5 billion,equity and bond products), AEW Europe (+€1.5 billion, real estate products), and Ostrum (+ €1.3 billion, mainly money market products) more than offset by H2O (-€7.3 billion, mainly bond products) and DNCA Finance (-€3.6 billion, diversified and bond products); there was a net outflow of funds in Asia (-€1.3 billion), mainly • in equity products; for Retail, outflows of €1.0 billion mainly relate to Dynamic • Solutions on diversified products (-€0.5 billion), structured products (-€0.5 billion), and equities (-€0.4 billion). Average outstandings of €881.1 billion on December 31, 2020 were up (+3.5% or stable restated for the LBPAM contribution) compared to last year, at constant exchange rates. The rate of return on outstandings, at 26.7 points, was down by 9.4% compared to December 31, 2019 at constant exchange rates, a more limited decline restated for the LBPAM contribution (-6.6%). On December 31, 2020, net banking income of €2,948.0 million was down by €562.7 million (-16.0%) compared to December 31, 2019 (-15.1% at constant exchange rates) with a scope effect related to LBPAM contributions limited to €4.4 million in 2020. The change in net banking income over one year was penalized by the sharp decrease in performance fees, mainly in Europe at H2O, and to a lesser extent, in management fees in the United States and Europe in connection with the fall in the rate of return, as well as the decline infinancial income. Expenses amounted to €2,156.5 million, down by €94.8 million (-4.2%) compared to December 31, 2019, (-3.2% at constant exchange rates) with an LBPAM scope effect of €5.5 million in 2020. The favorable change in expenses is due to the significant decrease in variable compensation (mainly in the United States, Europe, and the Federation) in line with the change in results and, to a lesser extent, operating expenses. Fixed internal personnel costs were up, driven by the growth in headcount, while premises and logistics were also up compared to 2019.

4

YEAR-ON-YEAR CHANGE IN ASSETS UNDER MANAGEMENT (in billions of euros)

+ 58.9

+ 5.1

+ 177.7

- 40.3

1,135.5

934.1

Assets under management at 12/31/2019

Foreign exchange effect

Scope effect

Net inflows

Market effect

Assets under management at 12/31/2020

The business line recorded net inflows of €5.1 billion at current exchange rates: in the United States, net inflows amounted to €7.4 billion, • mainly at Loomis Sales & Co. (+$13.2 billion,fixed income), at WCM Investment Management (+$12.4 billion, equity products), and at AEW Capital Management (+$2.7 billion,real estate products), partially offset by outflows at Harris Associates(-$19.8 billion,mainly equity products) and Gateway Investment Advisers, LLC (-$1.6 billion, alternative products);

225

UNIVERSAL REGISTRATION DOCUMENT 2020 | GROUPE BPCE