Results for the first quarter of 2016 of Groupe BPCE

May 10, 2016

Good commercial performance against a background of low interest rates and adverse market conditions.

Net income attributable to equity holders of the parent stable at €872m*

 

CONTINUED GROWTH DYNAMIC PURSUED BY THE CORE BUSINESS LINES[1]

Banque Populaire and Caisse d’Epargne retail banking network

  • Buoyant year-on-year growth in loan outstandings of +4.2% after 2 years of higher than market growth and growth in on-balance sheet deposits & savings +3.0%
  • Growth in the customer base with priority targets: +157,000 principal active customers using banking services over one year

Insurance[2]

  • Strong momentum in life insurance with gross inflows up +23% vs. Q1-15
  • Growth in portfolios of non-life insurance contracts +10% vs. March 31, 2015

Core business lines of Natixis

  • Investment Solutions: assets under management of €776bn at end-March 2016, oriented downward following a negative foreign exchange effect, disposal of affiliates and slight outflows (-€1bn); continued increase in margins
  • Corporate & Investment Banking: proportion of commissions in the revenues from structured financing maintained at a high level (37% in Q1-16) and continued strong momentum in Equity derivatives
  • Specialized Financial Services: good performance with premiums issued up +15% vs. Q1-15 (Sureties & financial guarantees), factored turnover up +10%, and strong growth in new production of real-estate leases

RESULTS STABLE DESPITE THE ENVIRONMENT CHARACTERIZED BY low interest rates

  • Decline in core business line revenues[3] to €5.7bn (-3.1%): commercial performance of retail banking limiting the negative impact of interest rates on net interest income and stability in Natixis core business lines revenues
  • Tight control over operating expenses, excluding increase in the estimated contribution to the Single Resolution Fund (SRF): +0.4% vs. Q1-15 (SRF: €218m in 2016, i.e a €112m increase vs. 2015)
  • Decline in the cost of risk5 to a moderate level: €372m (-24.6%), or 24bps (vs. 32bps in Q1-15)
  • Attributable net income generated by the core business lines2: €1bn in Q1-16, -1.2% vs. Q1-15
  • Attributable net income (excluding estimated increase in the SRF[4]): €680m, +5.4% vs. Q1-15

Continued strengthening of the balance sheet

  • Common Equity Tier 1 ratio (or CET1[5]) of 13.3% at March 31, 2016 (+10pbs vs. Dec. 31, 2015)
  • Total capital adequacy ratio[5[6] of 17.3% (+30pbs vs. Dec. 31, 2015)

Q1-15 pro forma (cf. the note on methodology at the end of this press release) ; unless specified to the contrary, all changes use the same reference base of March 31, 2015

*Excluding non-economic and exceptional items, and after restating to account for the IFRIC 21 impact


[1] Core business lines: Commercial Banking & Insurance, Investment Solutions, Corporate & Investment Banking, and Specialized Financial Services

[2] Entities included: CNP Assurances, Natixis Assurances, Prépar Vie (gross inflows held by the Banque Populaire and Caisse d’Epargne)

[3] Excluding non-economic and exceptional items

[4] €102m increase in net income attributable to equity holders of the parent vs. Q1-15

[5] Estimate at March 31, 2016 – CRR/CRD4 without transitional measures after deferred tax asset restatement on tax loss carryforwards

[6] Including circa €1.6bn in Tier-2 issues completed after March 31, 2016

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