Disclaimer 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, 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 depreciation. Readers must take all these risk factors and uncertainties into consideration before making their own judgement. The figures presented are not audited. The calculations are based on the rules contained in Directive 2013/36/EU of 26 June 2013 on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms and in Regulation (EU) No 575/2013 of 26 June 2013 on the prudential requirements for credit institutions and investment firms (CRD4), as interpreted by Crédit Agricole S.A. at 31 December 2013. Note: The Crédit Agricole Group scope of consolidation comprises: the Regional Banks, the Local Banks and Crédit Agricole S.A. and their subsidiaries. This is the scope of consolidation used by the French and European regulatory authorities to assess the Group's liquidity and solvency. Crédit Agricole S.A. is the listed entity. It owns c.25% of the Regional Banks and the subsidiaries of its business lines (French retail banking, International retail banking, Savings management and Insurance, Specialised financial services, and Corporate and investment banking).
Contents I II Crédit Agricole today: A European leader in marching order to deliver a sustainable performance Crédit Agricole Group 2016: Grow and deliver strong, recurring earnings Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France Step up revenue synergies within the Group Achieve focused growth in Europe Invest in human resources, strengthen Group efficiency and mitigate risks III IV Financial targets Business lines 2016 ambitions 3 I Investor Day 20 March 2014
I Crédit Agricole today: A European leader in marching order to deliver a sustainable performance 4 I Investor Day 20 March 2014
A Group united around a shared strategy Crédit Agricole : 49 million customers, 6 th largest European banking group by revenues 39 REGIONAL BANKS 21 million customers 7.4 million cooperative members 56.2% 1 of Crédit Agricole S.A. c. 25% of the Regional Banks equity-accounted Business synergies Economies of scale Financial unity and solidarity CRÉDIT AGRICOLE S.A. Retail Banking in France International Retail Banking Savings management and Insurance Specialised Financial Services Corporate and Investment Banking 1. Through SAS Rue La Boétie 5 I Investor Day 20 March 2014
A 2014-2016 Medium Term Plan in line with the Group Project 2011 2014 2016 Long-term Projet Group de Project Groupe The Group refocused on its core businesses, strengthened its financial structure and reduced its risk profile Grow and deliver strong, recurring earnings Become a European leader in Customer-focused Universal Banking 6 I Investor Day 20 March 2014
Business model: Customer-focused Universal Banking An integrated banking model to originate and provide a comprehensive range of financial services to all our customers Individual customers Farmers Small businesses Local authorities 39 Regional Banks CIB Savings management & Insurance Corporates Specialised services Institutional customers Poland 7 I Investor Day 20 March 2014
A Group strong in its domestic market, with a European focus 94% of the Group's revenues 1 come from Europe Geographical breakdown of business lines revenues in 2013 1 6% 11% 21% 73% France Rest of Europe Rest of the world 35% 54% Crédit Agricole Group Crédit Agricole S.A. 1. Business view, pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, excl. issuer spreads, CVA, DVA and loan hedges 8 I Investor Day 20 March 2014
Crédit Agricole today: No. 1 retail bank in Europe 21bn in retail banking revenues in Europe in 2013 Retail banking revenues in Europe 1 in 2013 ( bn) In the French market: Leader in all segments: Regional Banks and LCL aggregate penetration rates: Individual customers: 36% 2 SMEs: 45% 3 Small businesses: 42% 4 Farmers: over 85% 5 Stable market shares since 2010: Lending: 21% 6 of which 17.1% for the Regional Banks Deposits: 25% 6 of which 20.5% for the Regional Banks 1,400 branches in Italy and Poland Leading bank in France with 21 million customers and 7,000 branches nationwide Leading financial partner to the French economy with 400bn of loans outstanding to customers A bank with 6 million customers and 1,900 branches mainly in urban areas 8 th largest retail bank in Italy by branch network size, leading foreign retail bank in the regions it serves which are the most prosperous in Italy 1. Source: Financial communications, 9 months annualised for Intesa Sanpaolo 2. Aged 18 plus Source: OPERBAC 2012 CSA 3. Overall penetration rate in 2013 (entities with 10 to 1,000 employees and over 1.5m of revenues) Source: "Les Entreprises et les Banques 2013", TNS Sofres 4. Penetration rate for personal or business banking in 2012 (entities with less than 10 employees, excluding agriculture) Source: "Pépites 2011-2012", CSA 5. Penetration rate for business banking in 2012 Source: "Etude Installation des Agriculteurs, volet global", ADquation 2012. 6. Total Regional Banks and LCL, businesses and households, end-2013 Source: Banque de France, Surfi statements, Crédit Agricole S.A. 9 I Investor Day 20 March 2014
Retail Banking in France, high and recurring earnings based on the strength of Crédit Agricole s cooperative model Crédit Agricole Group: contribution of Regional Banks and LCL Crédit Agricole S.A.: contribution of Regional Banks 1 and LCL Net income Group share ( bn) Net income Group share ( bn) 3.0 0.5 2.5 3.4 3.6 0.6 0.7 3.3 0.6 2.8 2.9 2.7 2.7 0.7 2.0 3.1 0.6 2.5 4.0 4.1 4.2 4.3 0.7 0.7 0.7 0.6 3.3 3.4 3.5 3.7 1.4 1.4 1.3 1.2 0.6 0.7 0.6 0.5 0.7 0.8 0.8 0.8 1.2 1.3 0.7 0.6 0.6 0.7 1.7 1.7 1.6 1.7 0.7 0.7 0.7 0.6 0.9 1.0 1.0 1.1 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Regional Banks LCL 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Contribution of Regional Banks 1 LCL 1. Regional Banks accounted for at equity (c. 25%), before impairment of SAS Rue La Boétie and SACAM International shares and fair value adjustments 10 I Investor Day 20 March 2014
Specialised business lines in France and Europe: leadership positions Savings management & Insurance No. 1 European asset manager ( 777bn of assets under management at end-2013) No. 1 bancassurer in France and Europe ( 26bn of premium income in 2013) No. 2 in life insurance in France No. 1 depositary bank and No. 1 fund administrator in Europe (c. 2,254bn of assets under custody and 1,309bn of assets under administration at end-2013) 132bn AuM in private banking (end 2013, including LCL) Corporate and investment banking Specialised services CIB reprofiled as a debt house with a low risk profile, a strong European base, focused on major corporates and serving the Group No. 1 in loan syndication in France and No. 4 in EMEA World No. 1 in aircraft finance World No. 7 in project finance World No. 7 in euro bonds Leader in payments in France (8.6 billion transactions per annum) Major player in consumer finance in Europe ( 70bn in loans outstanding at end-2013) No. 1 in factoring and No. 4 in leasing in France ( 58bn of factored turnover in 2013 and 16bn of managed leasing portfolio at end-2013) Over 2bn invested in private equity in France A comprehensive stakeholder and the leading investor in the French real estate sector 11 I Investor Day 20 March 2014
Un Share PNB of our en customers banque de owning proximité a product en Europe acquired de through 21 Mds a Group en 2013 member 90% A unique capability to sell Group products and services to our customers 80% 70% 60% Considerable further potential for selling Group products to our retail customers in France 50% 40% 30% 20% Peer group average (France) 10% Leading bank in terms of internal product ownership 0% Health insurance Motor insurance Household insurance Providence Personal loans Life insurance Securities Home loans Passbook accounts LDD passbooks Home purchase savings Regional Banks retail customers owned 8.7 products per demand deposit account in 2012, a 28% increase since 2000 Source: Operbac 2012 12 I Investor Day 20 March 2014
In 2013, intra-group synergies generated 7.2bn of revenues A model that fosters synergies and keeps the value created within the Group Crédit Agricole Group 2013 revenues (excluding Corporate Centre) 18.1bn 7.2bn Stand-alone retail banking revenues (excluding synergies) e.g. home loans c. 54% of Group revenues Revenues generated by intragroup synergies c. 21% of Group revenues Stand-alone specialised business lines revenues (excluding synergies) e.g. CACF's external partnerships c. 25% of Group revenues 8.3bn Fees and commissions paid to the retail banks by the specialised business lines Specialised business lines revenues generated in conjunction with the Group's retail banks or with other Group business lines 13 I Investor Day 20 March 2014
Since 2011, the Group has reduced its risk profile, deleveraged its balance sheet and refocused on its strengths Review of the business portfolio Strengthen financial structure and reduce risk profile Prepare for tomorrow's growth Disposal of non-core assets Interests in Intesa Sanpaolo, Bankinter, BES VIDA, and partial divestment from Eurazeo CAPE, CA Cheuvreux, CLSA and Newedge CA Bulgaria, CACF Nordic entities 1 Disposal of Emporiki CACIB: Geographical refocusing, discontinuation of equity and commodity derivatives 2 and portfolio disposals Sale of market risks on credit derivative portfolios CACF and CAL&F: organic decline in activity Reduction in exposure to Southern European sovereigns Reduction in proportion of short-term debt, which fell below the level of liquidity reserves in early 2012 Reduction of the liquidity consumption by 68bn and risk weighted assets by 57bn from June 2011 to December 2012 IT convergence of Regional Banks (NICE) Structuring of the Group's real estate arm: Crédit Agricole Immobilier Agreement relating to the increased stake in Amundi CACIB: implementation of the distribute-to-originate model Launch of Crédit Agricole S.A.'s MUST cost optimisation programme 1. Subject to approval by relevant regulatory authorities 2. Excluding Corporate Equity Derivatives and precious metals 14 I Investor Day 20 March 2014
II Crédit Agricole 2016: Grow and deliver strong, recurring earnings 15 I Investor Day 20 March 2014
Five convictions guide our strategy 1 Our cooperative and mutual roots foster a sustainable performance 2 The European economy will pick up only very gradually 3 French market remains attractive for the banking industry 4 Regulatory environment hardening significantly 5 Customer expectations are changing radically 16 I Investor Day 20 March 2014
1 Our cooperative and mutual roots foster a sustainable performance Cooperative and mutual roots at the heart of the Regional Banks development Cooperative membership, a core pillar of the Group s mutual approach Special customer relationship with our mutual shareholders Mutual shareholders contribute to the Local Banks capital through mutual shares Earnings reinvested in our development 2016 target: increase the number of mutual shareholders from 7.4 to 10 million Regional Banks commitment to their local regions Reinvest all customer bank savings in the local economy Be a leading provider of finance to the players in the local economy Support business start-ups and young farmers new business ventures Values shared throughout the Group Ethics, a core pillar of the customer relationship Impartial advice to customers: relationship managers have no incentive to recommend one product over another Regular dialogue with customers to ensure that products and services are tailored to their needs Aim to be the leader in customer recommendation Ongoing training of the Group s employees in keeping with our values Significant investment to promote the employability of our employees and ensure smooth career paths A sustainable value-creating model based on building close, lasting relationships with customers to foster their satisfaction and loyalty 17 I Investor Day 20 March 2014
2 The European economy will pick up only very gradually Crédit Agricole has assumed a conservative economic scenario, which makes winning new customers and developing synergies even more important Growth will remain weak in Europe Very gradual rise in interest rates 0.8% 1.2% 1.1% GDP growth 0.9% 0.8% 0.7% 1.0% 1.2% 1.0% 2.4% >3.3% 3.0% 3.0% >4.0% 3.8% France Italy Eurozone 10-year OAT 10-year T- Notes 2014 2015 2016 End 2013 End 2014 2015-2016 Source: Crédit Agricole S.A. 18 I Investor Day 20 March 2014
3 French market remains attractive for the banking industry High level of household wealth A dynamic lending activity with low risk GDP per capita is the second highest of the key European countries The level of French household wealth 1 is higher than that of German or British households A low risk home loan market (doubtful loans ratio <1.5%) 3 Increase in loans outstanding No. 5 savings market 2 High savings rate Lending: an active market in France 20 15 10 5 7 5 3 1-2 -4 0 Source: Eurostat Germany France Italy Spain United Kingdom Household savings rate in 2012 (in % of gross available income) Source: ECB Euro Zone zone euro France Trends in lending to non-financial resident customers (% change YoY) 1. Gross wealth per capita (including property) 2. Among OECD countries, based on financial assets held by households (excluding financial liabilities) 3. Banque de France 19 I Investor Day 20 March 2014
4 Regulatory framework hardening significantly Prevention of systemic risk European Banking Union Competition and consumer protection New regulatory standards Capital requirements and leverage ratio (CRD4/CRR) Liquidity ratios (LCR, NSFR) Solvency II Banking structures: Banking law in France and projects at the European level Single Supervisory Mechanism for the eurozone at ECB level Asset Quality Review and stress tests Single Resolution Mechanism and Deposit guarantee scheme Bail-in, resolution and deposit guarantee scheme, European resolution authority Stronger competition Payments: emergence of nonbanking players Insurance: new contract termination options Increasing consumer pressure 20 I Investor Day 20 March 2014
5 Customer expectations are changing radically Higher expectations in terms of trust and added value New requirements in terms of accessibility Increasing demands on customer advisors Simplicity, availability, reactivity and pro-activeness Expertise, skills and customization A closer relationship Tangible proofs of recognition Customers are changing the way they use their bank. In today s digital world, they are now looking for: Continuous access Multi-channel rather than online banking (77% 1 of French are not prepared to become a customer of an online bank only) First-class Web and Mobile technology 1 source LH2, May 2012 21 I Investor Day 20 March 2014
Four strategic pillars to sustain our growth 1 Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France 2 Step up revenue synergies across the Group 3 Achieve focused growth in Europe 4 Invest in human resources, strengthen Group efficiency and mitigate risks 22 I Investor Day 20 March 2014
Four strategic pillars to sustain our growth 1 Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France 23 I Investor Day 20 March 2014
As part of the MT plan, extend solutions provided to customers Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France Regional Banks in 2016: even more relevant to our customers by extending the Universal Customer-focused Banking model Illustration of private individual customers Integrate new services to be even more relevant to customers A more accessible bank through multi-channel retail banking Financing/payment Savings Insurance Real estate solutions Home loans Consumer finance Payment instruments Passbook accounts Life insurance Mutual funds P&C Protection Health Estate agency Management Advisory 39 Regional Banks Multi-channel access Multi-channel relationship manager Branches Internet Customer relationship centres Key role Dedicated Supported by experts Emerging needs (Crédit Agricole s areas of excellence) Telemonitoring and teleassistance Retirement savings Energy efficiency analysis 100% of offers available through all remote channels Internet Mobile Telephone 24 I Investor Day 20 March 2014
Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France Crédit Agricole: the multi-channel retail bank close to its customers Strategic positioning and expectations of our customers Value proposition: The best of banking for everyone, everywhere Means deployed Targets The leading retail bank in France Extensive branch network covering the entire territory Full range of products and services Broad customer franchise representative of the French population Niche expertise for crossborder customers Customer expectations focusing on Human and geographical proximity Easy access to all Crédit Agricole services Need for expertise and advice A bank-customer relationship based on human contact and proximity Maintain a strong nationwide network A dedicated multi-channel customer advisor supported by experts throughout the network A full multi-channel, fully digital bank 100% of offers and transactions available through all remote channels A more convenient bank: extended hours, more expertise at local level Differentiation through service excellence: paperless, simpler processes, superior aftersales service, innovative payment solutions Cooperative values that strengthen the human relationship and loyalty towards the bank over time A multi-channel bank supported by the deployment of new resources A unified, powerful IT platform offering all the benefits of a multi-channel bank Innovation centres for the Regional Banks: CA Store, Fireca, CA Innov, «Le Village» Creation of Customer Relations Centres and a 24/7 hotline Strengthen expertise and skills among our employees in the network (specialist advisors, experts, etc.) Focus resources on business development: 80% of employees to be in direct contact with customers by 2016 Investments of 1.8bn over 2014-2016 Increase our penetration rate in private individuals segment by +1 point Leadership in customer recommendation 2016 revenues 1 c. 15.5bn Cost/income ratio below 54% by 2016 1. Crédit Agricole Group revenue estimations 25 I Investor Day 20 March 2014
Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France LCL: leading relationship and digital bank in urban areas Strategic positioning and customer expectations Value proposition: "The whole of LCL à la carte" Personalisation, service continuity and choice Resources deployed Targets Strong presence in major urban areas (60% of LCL branches) Strong positions in specific customer segments Large corporates Small companies No. 2 in private banking in France Young working people and students Specific customer expectations High degree of responsiveness and digital access Easy access to specialised skills and expertise Continuity of service, no matter when or where, face to face or remote Customer advisor available 6 days a week until 10pm and customer query dealt with on first contact Full online LCL All transactions, products and aftersales service available online Flawless service at each stage of the customer experience A 5-year global transformation plan c. 300m of additional investments 1 over 3 years including c. 160m in IT and c. 140m in staff and branch network support Adapt distribution networks to provide better availability and more expertise Branch groupings supported by Customer Relationship Centres (after-sales, extended hours, expertise) Pools of advisors integrated in the new multichannel scheme Dedicated experts for specialised customer groups Simplify all customer transactions and customer support structures Reinforce skills and expertise and shift towards a ratio of c. 78% of staff in contact with customers, supported by natural attrition 2016 revenues c. 4bn Cost/income ratio 2 < 64% in 2016 and c. 61% in 2018 360,000 additional individual customers by 2016 40% of large corporates customers of LCL by 2016 1. 5-year 400m investment programme in addition to recurring investment; 2. Cost/income ratio excluding charges linked to the exceptional investment programme 26 I Investor Day 20 March 2014
Innovate and transform our retail banking business to better serve our customers and strengthen our leadership in France Transformation tailored to each network to meet new customer expectations, in line with the specific features of our banks and customer groups c. 7,000 branches Homogenous geographical coverage c. 1,900 branches Strong presence in large towns and cities @ The multi-channel retail bank close to its customers Leading relationship and digital bank in urban areas Full online bank 1. Crédit Agricole Group revenues estimations Our 2016 targets: Achieve revenues 1 of c. 19.5bn in French retail banking Increase our market shares in all customer segments by 2016 27 I Investor Day 20 March 2014
Four strategic pillars to sustain our growth 2 Step up revenue synergies across the Group 28 I Investor Day 20 March 2014
Step up revenue synergies across the Group Over 850m of additional Group synergies by 2016, main contributors being Savings management & Insurance Revenues 1 generated by Group synergies 7.2bn 8.0bn 2013 2016 o/w Crédit Agricole S.A. 4.9bn 5.4bn 1. Group origination and distribution revenues, broken down by underlying product type Savings management & Insurance Promote a new approach to high net worth customers in life insurance and mutual funds in conjunction with the retail banks Develop cross-selling in wealth management Develop sales of death & disability and P&C products for all retail bank customers Offer a comprehensive Group insurance offer (death & disability, health, retirement) Specialised Services Increase consumer finance and leasing outstandings as well as factoring business carried out by the retail banks Develop the Group's third business line real estate by helping our customers to build, manage and monetise their property assets Promote telemonitoring and teleassistance Set up innovative payment solutions for all our costumers Corporate & Investment Banking Support our intermediate-sized enterprises customers of the retail banks, particularly abroad Develop market based financing solutions for Group customers and Credit Agricole s own needs 29 I Investor Day 20 March 2014
Step up revenue synergies across the Group Bancassurance: a major contributor to developing intra-group synergies Life Insurance: AuM +10% by 2016 Health, death & disability and creditor insurance: Premium income +12% by 2016 Property & casualty insurance: Premium income +29% by 2016 Increase life insurance inflows in the high net worth segment Capitalise on the introduction of the new Euro-growth contracts in France Actively seek new business in group death & disability insurance Increase penetration rate of small and very small businesses Capitalise on the new French regulatory framework to strengthen our positions in creditor insurance Raise the internal ownership rate of Regional Banks individual customers in motor, household, health or life s accident insurance contracts to 40% Provide a tailored offer to satisfy the specific needs of the farming world Group insurance revenues ( bn) 5.0 5.6 International Continue to grow organically in the markets where the Group already operates (Italy and Poland) Develop partnerships in creditor insurance 2013 2016 30 I Investor Day 20 March 2014
Step up revenue synergies across the Group Broaden synergies between Specialised Services and retail networks Boost the consumer finance business in the Group's retail banks and close the gap with our competitors in terms of market penetration Redefine cooperation method with the Group's retail banks, with new standards for quality of service and better sales management Develop sales of Group insurance products (creditor insurance, property & casualty) + 3.5bn in consumer finance loans managed on behalf of the Group's retail banks by 2016 1 Continue to integrate the leasing and factoring businesses with the Group's retail banks Improve leasing distribution and funding model Step up presence in areas of excellence (including renewable energy) Share of leasing in medium term corporate financing: +2.5 points Share of factoring in short-term corporate financing: +4 points Broaden our product range to help customers build, manage, enhance the value of and monetise their property assets Support our customers in managing their property assets needs thanks to our end-to-end expertise in estate agency, property management and advice Be a renowned national player in commercial real estate development to meet the needs of the Group's banks, their customers and local economies 1. Increase in the outstanding loans originated by the Group s retail banks and broaden CACF s scope of intervention 31 I Investor Day 20 March 2014
Step up revenue synergies across the Group Long-term synergies: the Group's areas of excellence Farming and agri-food business Housing Energy and environment Health & ageing Long-term stakes Maintain a dynamic agricultural fabric in the regions Promote access to housing of all French citizens by being active in all aspects of the sector Facilitate energy-change operations and meet new needs Accompany the ageing population in our territories Leadership positions Over 85% penetration rate among French farmers 42% market share on loans in the agri-food sector in France Leader in home loans for individuals Investment solutions for all matters relating to property assets Amundi, 1 st SRI asset manager in France Leading expertise in specialised financing Leadership in savings and insurance (retirement planning and death & disability) Our ambitions for 2016 Strengthen our leadership in the farming segment In agri-food sector, extend our position as leading player in France to the rest of Europe Finance and support 90% viable infrastructure for young farmers Maximise synergies between banking, insurance and real estate businesses and increase equipment rate in multi-risk home insurance policy (target 50%) Be a pioneer in providing finance through digital channels Develop responsible savings: target of 100bn SRI outstandings Support energy and environmental projects in all regions Extend our eco-renovation offer to the whole territory Aim for leadership in retirement savings, with a high-quality advisory approach Become a major player in corporate insurance Market share target of 5% in health insurance 32 I Investor Day 20 March 2014
Four strategic pillars to sustain our growth 3 Achieve focused growth in Europe 33 I Investor Day 20 March 2014
Achieve focused growth in Europe Strengthen our focused growth in Europe 3 drivers of growth in Europe 1. Continue to deploy our Universal Customer-focused banking model 2. Develop our specialised business lines and support our retail bank customers 3. Extend the Regional Banks cross-border business Countries with a Universal Customer-focused Bank Main countries where our specialised business lines are present Other countries where CA operates Strengthen the commercial setup of the Group s specialised business lines 34 I Investor Day 20 March 2014
Achieve focused growth in Europe 12% revenue growth in Europe excluding France by 2016 Crédit Agricole Group revenues in Europe (excl. France) 1 bn Corporate and Investment Banking 6.8 7.6 2 2016 vs. 2013 +11% Specialised financial services Savings management & Insurance +11% +5% (+18% Amundi & CAA) International Retail Banking +16% 2013 2016 Target 1.Business view, pro forma for equity-accounted entities under proportionate method in 2013, restated for CVA/DVA and loan hedges; 2.Excluding external growth 35 I Investor Day 20 March 2014
Achieve focused growth in Europe By 2016, +14% revenue 1 growth in Italy, our second domestic market Continue Cariparma s transformation and step up its development Transform our distribution models Reorganise and modernise the branch network Become the leading digital bank in Italy: develop multi-channel and online banking Gain market shares in lending and deposits and increase cross-selling of Group products Continue efforts to industrialise processes Centralise some back office functions, automate the branches, etc.: c.720 departures by 2015 (9% of 2012 headcount) Industrialise lending and collection processes Develop Group convergence (shared applications, tools, etc.) A 180m investment programme to sustain our development ambitions over the plan period 2013-2016 Cariparma revenues: +5% p.a. Develop priority markets through Group synergies Develop capability in the intermediate-sized enterprises segment through synergies between Cariparma and CACIB Become a leading bank in farming and agri-food sector in Italy Strengthen the wealth management and private banking offer through synergies between Cariparma and CA Private Banking Develop the insurance business and particularly death & disability Synergies in Italy in 2016: c. 500m Continue to control risks Cariparma: decrease in cost of risk of c.60bp (normalisation of economic conditions, result of lending policies implemented since the crisis) Agos: continued reduction in cost of risk ahead of initial plan FGAC: maintain a low cost of risk (c.80bp) Decrease in cost of risk: c.40% for Agos and Cariparma 1 Business view, pro forma for equity-accounted entities under proportionate method in 2013 36 I Investor Day 20 March 2014
Achieve focused growth in Europe Accelerate growth in Europe in Savings management & Insurance (1/2) Reach 1,000bn in AuM in 2016 No 1. Asset manager in Europe with an innovative, valuecreating industrial model A comprehensive and recognised product offer with leadership positions Cost/income ratio at best-in class level (c. 55%) thanks to an innovative industrial model Proven expertise in integrating new networks Step up our organic growth in Europe Strengthen commercial resources in Germany and the United Kingdom and open offices in the Netherlands and Sweden Develop product offers: debt funds, European employee savings plans, etc. Play a key role in sector consolidation in Europe Acquisition of mid-sized players in order to open the platform to one or more new distribution networks Targeted acquisitions to speed up the development of high priority businesses or geographical areas Leader in asset servicing in Europe Strengthen CACEIS' European presence dedicated to the global players Set up depositary banks in Belgium, Italy, Switzerland, the Netherlands and the United Kingdom Develop assets under administration in Germany Increase assets under custody by 300bn in our five new depositary banks Expand internationally, mainly in Belgium and Luxembourg 37 I Investor Day 20 March 2014
Achieve focused growth in Europe Accelerate growth in Europe in Savings management & Insurance (2/2) Grow in Europe to support the Group s banking entities and develop external partnerships Develop our bancassurance model in Italy and Poland, particularly in death & disability and life insurance In creditor insurance, develop new partnerships, proprietary distribution channels and cross-selling Selective growth in our European domestic markets Develop domestic business franchises in Belgium and Spain Set up a wealth management business in Italy Play a selective role in the sector consolidation Revenue growth in Europe (excl. France) > +15% by 2016 + 4bn in AuM in Belgium, Spain and Italy 38 I Investor Day 20 March 2014
Achieve focused growth in Europe A strategy focused on key countries for Specialised financial services Refocus activity on self-funded, profitable business In Europe, focus on key markets and partnerships, as well as strategic entities Benefit from new agreements negotiated for FGAC and Agos and strengthen synergies with Group entities Refocus European business on self-funded, highly profitable entities Implement a proactive self-funding plan (deposits, securitisation, etc.) Maintain a stringent risk management policy European leader in factoring and strong positions in leasing Develop CAL&F's business in cooperation with the retail banks in Italy and Poland Strong increase in the profitability of European activities, supported by a reduction in the cost of risk Revenue synergies with the Group s international retail banks: + 20m revenues by 2016 39 I Investor Day 20 March 2014
Achieve focused growth in Europe Corporate and Investment Banking: a strategy anchored to Europe serving large corporates and institutional investors A "Distribute-to-Originate" debt house anchored to Europe, serving major borrowers and investors, as well as Crédit Agricole Group Step up relationships with our core customer groups: European leaders and global players active in Europe Continue to roll out our Distribute-to-Originate model Broaden loan distribution to new investors (e.g. debt funds, insurers) Consolidate our franchise in Structured finance Strengthen our market share in the primary euro bond market Develop cross-selling between financing and capital markets & investment banking activities Actively manage allocated resources and fully offset the increase in risk weighted assets due to CRD4 implementation Revenue 1 growth in Europe (excl. France) : +11% by 2016 1.Business view, pro forma for equity-accounting of entities under proportionate method in 2013, restated for CVA/DVA, loan hedges 40 I Investor Day 20 March 2014
Four strategic pillars to sustain our growth 4 Invest in human resources, strengthen Group efficiency and mitigate risks 41 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks An ambitious investment plan to support our medium term targets Global investment of c. 3.7bn over the plan period, including c. 2/3 in retail banking c. 1.8bn c. 0.7bn 1 c. 1.2bn c. 3.7bn 2 35% Increased investments under the Medium Term Plan c. 3.7bn of investments dedicated to: Supporting business development Improving operational efficiency 35% of investments are non-recurring and will support the Medium Term Plan initiatives 65% Recurring investments Three investment priorities: Regional Banks LCL Other business lines & support functions in Crédit Agricole S.A. Total Human resources Technology Cost savings 1. Prorata temporis of the exceptional 5-year 400m investment plan and LCL's ongoing investment ; 2. Excluding acquisitions. Investments included in the 2014-2016 financial plan 42 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks Crédit Agricole Group is investing in human resources to meet the transformation challenges of the next few years Anticipate and support our businesses transformation Prepare for the future Need to support the transformation of our retail networks in their transition to multi-channel banking Train customer advisors to handle multi-channel mode Reallocate the commercial time freed up by digital Help employees to adapt to new jobs Strengthen expertise in specialised businesses (high net worth individuals, very small companies, SMEs, corporates, etc.) Recruit digital specialists (CRM, Big data) Exceptional investment effort planned Over 250m to be invested in human resources from 2014 to 2016 to meet transformation challenges Develop skills and resources of the Group s internal training institute (IFCAM) Continue recruiting considering natural attrition Crédit Agricole Group is one of the largest recruiters in France Concrete actions to foster day-to-day employee commitment Regular measurements of Group employees commitment allowing them to express themselves, followed by action plans Proactive management of talent and key skills Will to involve concerned parties in forward management of jobs and employment Proactive approach to promote diversity 43 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks Crédit Agricole Group is investing in IT convergence and cost-cutting Accelerate the Group IT convergence Continue our cost-cutting programmes NICE, the largest IT project in the European banking industry, serving 21 million customers End-2013: Regional Banks have all switched to the common NICE system New initiatives in 2014-2016 Development of new multi-channel and specialised market functionalities on the NICE platform Broader applications convergence between LCL and the NICE platform Launch of a Group IT-production sharing programme : first step of the project with Crédit Agricole S.A., second step with the Regional Banks Extension of the Group s Payment platform to Cariparma and CA Bank Polska MUST, a program of major structural significance 351m of savings achieved at end-2013 out of a target of 650m by 2016 New initiatives in 2014-2016 The whole Crédit Agricole Group to benefit from MUST programme (external expenses and real estate) Project of partial replacement of the 5,000 natural departures expected for Crédit Agricole S.A. over the plan period CACIB: outsourcing and offshoring of IT and back-offices, cost reduction in discontinuing activities A voluntary cost savings plan at CACF A cost optimisation plan for CA Private Banking 44 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks Crédit Agricole Group continues its cost reduction effort Main cost-saving initiatives by 2016 ( m) Cost savings planned for 2014-2016 in addition to those already achieved as at 31/12/2013 300 240 190 220 950m 430 520 Regional Banks Crédit Agricole S.A. Cost/income ratio down by over 2 points 1 for Crédit Agricole Group and over 3 points 1 for Crédit Agricole S.A. in 2016 compared with 2013 Future savings MUST Future savings NICE New Regional Banks initiatives New Crédit Agricole S.A. initiatives 2016 target 1. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, restated for issuer spreads, CVA/DVA, loan hedges 45 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks A responsible risk policy A low impaired loan ratio on loans outstanding (2.5% in 2013 for the Regional Banks and 3.9% for Crédit Agricole S.A.) thanks to a conservative lending policy and exposure to relatively nonvolatile markets (51% of Crédit Agricole S.A.'s loans outstanding are in France) A very high coverage ratio, which the Group intends to maintain (at end 2013, 107% for the Regional Banks and 72% for Crédit Agricole S.A. including collective reserves) A low exposure of the banking Group to Southern European sovereigns ( 5,230m net 1 at 31/12/2013), which will be maintained in the medium term A low VaR, in line with the Group's will to contain its exposure to market risk Maintain a comfortable liquidity surplus and limit cross-border funding 1. Net exposure is equal to carrying value, excluding hedges 46 I Investor Day 20 March 2014
Invest in human resources, strengthen Group efficiency and mitigate risks CSR at the heart of all our business activities A Cooperative Regional Pact for all the Regional Banks A CSR policy structured around 3 ambitions Control all types of risks Ethics in our operations, incorporation of CSR criteria in both our products & services and sector policies Aim for excellence in relationships with customers and with employees and in the way we operate: Excellence in customer relationship, a responsible employer policy, a mitigated direct environmental footprint, CSR criteria integrated in the purchasing processes, etc. Support local regions in their sustainable development challenges Support customers in their sustainable development stakes, provide answers to long-term economic and social issues in our four areas of excellence, etc. Member of major sustainable development benchmark indices: Where we stand No. 1 in renewable energy and energy efficiency financing in France World No. 1 in sustainable bond issues 1/3 of deferred variable compensation of Crédit Agricole S.A. executives indexed to CSR performance through the FReD progress index CSR targets Regional Banks CSR: a Cooperative Regional Pact deployed in all the Regional Banks Integrate ESG (Environmental, Social and Governance) factors in all lending and financing activities 100bn in SRI assets under management Women to account for 20% of all senior executives 47 I Investor Day 20 March 2014
48 I Investor Day 20 March 2014 Crédit Agricole 2016
Crédit Agricole 2016: A developing Customer-focused Universal Bank that is delivering a strong, recurring financial performance Today 2016 A Group in marching order A refocused business mix Efficient operational platforms 1 2 For each business line, a positioning consistent with the Group's model A Group reinforced on its core activities Stabilised financial equilibrium 3 A strong, profitable Group 49 I Investor Day 20 March 2014
1 SAVINGS MANAGEMENT & INSURANCE For each business line, a positioning consistent with the Group's model RETAIL BANKING CORPORATE AND INVESTMENT BANKING Insurance A full and integrated leader in bancassurance The multi-channel retail bank close to its customers A European debt house serving large companies and the Group Asset management A global leader in asset management Private banking Dedicated expertise to high net worth customers Asset servicing A European leader in asset servicing Other international retail banks Full-online bank Leading relationship and digital bank in urban areas The Group's backbone in its second domestic market, Italy Profitable growth drivers in emerging countries Major players in their markets, anchored in the Group SPECIALISED SERVICES Consumer finance Leasing and factoring Real estate Payments Telemonitoring 50 I Investor Day 20 March 2014
2 A Group refocused on its core activities Increase of the share of risk weighted assets in Retail banking and Savings management & Insurance Risk weighted assets per business line in bn c. 500 c. 510 c. 370 c. 370 Corporate and Investment Bank, Specialised financial services +4 pp 67% Retail banking, Savings management & Insurance January 2014 2016 Retail banking, Savings management & Insurance +5 pp 55% Retail banking, Savings management & Insurance January 2014 2016 Crédit Agricole Group Crédit Agricole S.A. (before Switch) 51 I Investor Day 20 March 2014
3 A strong, profitable Group (1/2) 2016 targets PROFITABLE GROWTH Crédit Agricole Group Crédit Agricole S.A. Average annual revenue 1 growth: c. +2% per annum c. +2.5% per annum Net Income Group Share : > 6.5bn > 4bn Target RoTE: 12% 1. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, restated for issuer spreads, CVA/DVA, loan hedges 52 I Investor Day 20 March 2014
3 A strong, profitable Group (2/2) 2016 targets STRONG FINANCIAL FUNDAMENTALS Crédit Agricole Group Crédit Agricole S.A. Improving cost/income ratio 1 : <60% <64% Basel 3 fully loaded CET1 solvency ratio well ahead of regulatory requirements: 14.0% >10.5% 1. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, restated for issuer spreads, CVA/DVA, loan hedges 53 I Investor Day 20 March 2014
54 I Investor Day 20 March 2014 III Financial targets
Financial summary Crédit Agricole S.A. is emerging from several years of far-reaching strategic and financial restructuring Start of adjustment plan CACIB: geographical refocusing, discontinuation of equity and commodity derivatives market activities 1 and portfolio disposals CACF and CAL&F: organic decline in activity Reduction in proportion of short-term debt, which fell below the level of liquidity reserves in early 2012 Significant asset valuation adjustment CACIB: gradual implementation of the Distribute-to-Originate model 2011 2012 2013 Disposal of non-core assets Intesa Sanpaolo Reduction in exposure to Southern European sovereigns Significant asset valuation adjustment Launch of Crédit Agricole S.A. s MUST cost optimisation programme Implementation of staff reduction plans at CACIB and CACF Restructuring of Agos Disposal of non-core assets Emporiki CA Cheuvreux, CLSA & Newedge Bankinter, BES Vida, CAPE, partial sale of Eurazeo stake Preparation of the disposal of CA Bulgaria and CACF s Nordic entities Agreement to increase stake in Amundi 2011 2013 Total assets ( bn) 1,723 1,537 Goodwill ( bn) 17.5 13.5 Loan-to-deposit ratio for Retail Banking in France (LCL) 129% 109% Reduction in SFS and CIB funding needs since 06/11 ( bn) (52) Simpler business mix and improved risk profile More active liquidity and solvency management Revenues ( m) 20,783 16,015 1. Excluding Corporate Equity Derivatives and precious metals 55 I Investor Day 20 March 2014
Financial summary The MT Plan reflects the achievements of this restructuring: the prospect of a lasting performance Income estimates performed in a still fragile economic context but reflecting a progressive normalisation of the situation in the eurozone Income targets based on: the proven resilience of the Retail banking and Savings management & Insurance (SM & I) business lines the rebound of business lines which suffered particularly in the 2008/2013 crisis Very progressive increase of rates Net income Group share of business lines 1 : 2008-2013 and 2016 target >4.0% T-Notes 10 years 3.8% OAT 10 years >3.3% 3.0% 3.0% Q1-08 Q1-09 Q1-10 Q1-11 Q1-12 Q1-13 2016 target avg quarter 2.4% End 2013 End 2014 2015-2016 SM&I French Retail banking Q1-08 Q1-09 Q1-10 Q1-11 Q1-12 Q1-13 2016 target avg quarter CIB SFS Source: Crédit Agricole S.A. 1. NIGS Crédit Agricole S.A. excl. goodwill impairment 56 I Investor Day 20 March 2014
Financial summary The MT Plan reflects these new fundamentals: aiming for sustainable performance Three areas of improvement Financial efficiency with moderate revenue targets for Crédit Agricole S.A. but targeted growth business line by business line Operational efficiency with a cost savings plan to support a cost/income target of <60% for Crédit Agricole Group and <64% for Crédit Agricole S.A. Continued decrease in cost of risk, driven by good asset quality and normalisation of the situation in Italy Forward-looking capital management policy Continue to strengthen the Regional Banks capital Crédit Agricole S.A. s target fully loaded CET1 ratio (9.5%) to be achieved by 2015 notably thanks to the payment of a scrip dividend to the Regional Banks Available leeway (c.100bp of CET1 in 2016, i.e. more than 3bn) Financial efficiency: Revenues/risk weighted assets Operational efficiency: cost/income ratio Continued decrease in cost of risk over outstandings (bp) Crédit Agricole S.A.'s fully loaded CET1 ratio targets 5.4% 5.3% 4.9% 5.8% 79.2% 70.4% 106 78 87 75 67 55 8.3% 9.0% 9.8% >10.5% 64.0% <64% 2010 published Basel 2 2013 published Basel 2.5 Crédit Agricole S.A. scope 2013 pro forma Basel 3 and IFRS11 2016 target 2006 2008 2013 2016 1 1 2009 2010 2011 2012 2013 2016 target 1. Excluding impact of support plan to Greece Jan-14 Dec-14 2015 2016 57 I Investor Day 20 March 2014
2016 Financial targets A sound and efficient bank 2016 targets Crédit Agricole Regional Banks Group o/w Crédit Agricole S.A. Revenue growth (2013-2016) 1 c. +1% p.a. c. +2% p.a. c. +2.5% p.a. Business Cost/income ratio 2016 1 <54% <60% <64% Cost of risk / outstandings (bp) 1 c.25 c.40 c.55 Profitability NIGS 2016 RoTE 2016 > 3.7bn > 6.5bn > 4bn 12% CET1 fully loaded 14.0% >10.5% Solvency Total capital phased 16.5% 15.5% Targeted pay-out ratio (assumption) 50% 1. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, excl. issuer spreads, CVA, DVA and loan hedges 58 I Investor Day 20 March 2014
2016 Financial targets Indicator per business line Revenues 2013/2016 Cost/income ratio 2016 RoTE 2016 Retail banking Regional Banks (100%) LCL International retail banking Revenues c. +1% p.a. Revenues c. +1% p.a. Revenues c. +7% p.a. <54% <64% 4 <55% >20% c. 20% Savings management & Insurance Savings management (Amundi, CACEIS, Private banking Insurance AUM >+3% 3 Revenues c. +2% p.a. Premiums +6% Revenues c. +4% p.a. <65% >35% 1 <30% c.34% 1 Financing businesses Specialised financial services 2 Corporate and investment banking 2 Revenues c. +1% p.a. Revenues c. +3% p.a. <45% c.53% >10% c.12% 1. ROTE calculated on basis of capital allocated at 9% of risk weighted assets and including the main regulatory deductions from the CET1 numerator. For Amundi, profitability would be 6bp calculated on AUMs and for Insurance, profitability would be 13% calculated on 80% of the solvency margin; 2. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013, excl. CVA, DVA and loan hedges ; 3. excl. external growth ; 4. excluding expenses linked to the investment plan 59 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 60 I Investor Day 20 March 2014
2016 Financial targets Analysis of revenues Balanced growth of the business lines over the period of the Plan 2/3 of Crédit Agricole S.A. s revenue growth stems from Retail banking and Savings management & Insurance Expected rebound for activities affected by the crisis and the adjustment plan (IRB, SFS, CIB) Revenues of Crédit Agricole S.A.business lines between 2013 and 2016 In bn and CAGR 2013-2016 18,112 c.+3% p.a. c.+3% p.a. c.+3% p.a. 6,735 5,130 c.5,600 6,247 c.6,800 c.19,700 1 1 SFS & CIB c.7,300 SM & Ins. LCL & IRB 1 2013 Change LCL & IRB Change SM & Ins. Change 1 1 SFS & CIB 2016 target 1. Excl. loan hedges, CVA and DVA for CIB and pro forma of reclassification under equity-accounting of entities under proportionate method in 2013 for SFS and CIB 61 I Investor Day 20 March 2014
2016 Financial targets Analysis of operating expenses Cost savings actions cover inflation, taxes and the bulk of modernisation costs Expenses of Crédit Agricole S.A. business lines between 2013 and 2016 In bn and % p.a. 2013-2016 10,235 c.10,400 3,710 c.+1% p.a. c.+2% p.a. (c. 1%) p.a. c.3,600 2,494 c.2,650 1 1 SFS & CIB SM & Ins. LCL & IRB 4,031 c.4,150 1 2013 Change LCL & IRB Change SM & Ins. Change 1 SFS & CIB 1 2016 target 1. Pro forma of reclassification under equity-accounting of entities under proportionate method in 2013 for SFS and CIB 62 I Investor Day 20 March 2014
2016 Financial targets Improvement of cost/income ratio Continuation of cost reduction efforts Good cost/income ratio for the business lines, which will be further improved thanks to the cost reduction programmes Crédit Agricole S.A.: 520m of savings expected between 2014 and 2016 MUST programme: 300m in savings, above the 350m savings achieved at end 2013 Additional effort: 220m Regional Banks: 430m of savings expected between 2014 and 2016 NICE IT programme: 240m and new actions for 190m Crédit Agricole S.A. cost/income ratio adversely impacted by the Corporate centre Crédit Agricole Group cost/income ratio among the best in the industry Cost/income ratios 2013 1 2016 54% <54% 2 66% 61% 62% <55% 2018 target 49% 47% 49% <45% 60% 53% 2013 2016 62% 67% <60% <64% Crédit Agricole Group Crédit Agricole S.A. 1 1 RB LCL IRB SM & Ins. SFS CIB 1. Excl. issuer spreads, loan hedges, CVA/DVA and pro forma of reclassification under equity-accounting of entities under proportionate method in 2013 for SFS and CIB ; 2. Excluding expenses linked to the investment plan 63 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate Centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 64 I Investor Day 20 March 2014
Presentation of Corporate Centre Corporate Centre: the financial reflection of various activities Corporate Centre is used to book the results of holding company and central body activities and includes the contribution of non-business subsidiaries In m Revenue Costs Other Unallocated central functions CENTRAL BODY AND TREASURER Group treasury Raising liquidity in the markets on behalf of entities, rebilled at fund transfer prices that reflect market conditions Covering duration and currency needs Managing solvency Issuing debt in the markets Managing AT1/ T2 levels and requirements HOLDING COMPANY AND PORTFOLIO ACTIVITIES Acquisitions of equity investments (and their funding) Capital management Portfolio activities (Private Equity division, Eurazeo) Capital management c. -350 1 + Financial management c.+400 1 Holding company and portfolio activities c. -2,000 1-930 1 Non-business functions OTHER SUBSIDIARIES Caisse Régionale de Crédit Agricole mutuel de Corse FIA-NET Foncaris Uni-Editions MANAGEMENT COMPANIES/SUPPORT SUBSIDIARIES CA Cards & Payments Silca (IT) REAL ESTATE CA Immobilier Group 6 real estate companies Cost of risk 1-160 + income tax 1 + 1,100 Specific items ISSUER SPREAD c. +430 1 c. - 600 2 65 I Investor Day 20 March 2014 1. Average annual amount over the period 2010-2013; 2. 2013 figure
1 Corporate Centre Cost of capital and debt management: main recurring Corporate Centre item Cost of capital and debt management 1 : impact of past acquisition policy and new more stringent regulatory requirements Cost of capital and debt management ( m) 500 0-500 -1,000 2010 2011 2012 2013 Cost of debt allocated to funding equity investments c. 1,500m Financial investments Cost of debt allocated to funding equity investments Details Financial expenses related to equity investments acquired since 2001 (net value at 31/12/2013: 63.5bn) Active management and repayments -1,500-2,000-2,500 Cost of subordination and internal capital management (T3CJ- Shareholder's advance- Switch-Tier 2 insurance) Costs impacted by more stringent regulatory requirements (leverage, AT1, Tier 2) Internal capital management: proportion of subordinated debt replaced by Switch These costs do not reflect funding of operational business activities but the structure of Crédit Agricole S.A. since 2002 By nature attributable to central body activities (Switch, AT1, Tier2 ) and holding company activities (acquisition and carrying costs of business subsidiaries) 1. The cost of capital and debt management includes: the cost of debt related to equity investments (acquisition and recapitalisation), other costs related to senior debt and costs related to capital management mechanisms within Crédit Agricole Group: Switch guarantee, insurance leverage 66 I Investor Day 20 March 2014
2 Corporate Centre Operating costs Operating costs partially offset by revenue from management companies m Operating costs net of management company revenues c. 500m Main Corporate Centre operating cost items Head office costs: Central functions: Corporate Secretary, Legal, Human Resources, Finance, Treasury, etc. Control functions: Internal Audit, Compliance, Risk Overheads: rent, IT Taxes (systemic, ACPR, C3S ) Cost of resources and support subsidiaries (e.g. Silca for IT) Rebilled to their internal customers (recognised in Other Revenues) Residual operating costs: c. 500m a year on average, net of internal rebilling representing <5% of Crédit Agricole S.A. s annual costs 67 I Investor Day 20 March 2014
Corporate Centre Outlook for 2016 Acquisition debt and ratio management costs Corporate Centre will continue to carry acquisition debt and ratio management costs 2016 outlook Impact on revenues of liquidity and leverage ratios will be taken into account in targets for the businesses Expected reduction in total costs Debt management: active management, lower interest rates, gradual repayment of legacy debt Booking of AT1 in OCI and natural run-off of deeply subordinated notes (TSS) booked in current revenues Reduction in operating costs Net income Group share c.- 1,500m a year as of 2016 Partially offset by the impact of new regulatory requirements Strengthening AT1/Tier 2 over the plan period Extension of Switch mechanism in 2014 Contribution to Crisis Resolution Fund and Deposit Guarantee Scheme New costs of c. 300mn to be reallocated to the businesses (provisionally booked in Corporate Centre) 68 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 69 I Investor Day 20 March 2014
Profitability Crédit Agricole S.A. RoTE Crédit Agricole S.A. RoTE on average accounting equity 9.3% Financial efficiency Operational efficiency Decrease in cost of risk 12% 2013 2016 target 70 I Investor Day 20 March 2014
Business line profitability Risk weighted assets and capital allocation per business line Breakdown of risk weighted assets reflecting the priority given to the Retail banking and Savings management & Insurance businesses Capital allocation reflecting the implementation (2011/2014) of internal guarantees between Crédit Agricole S.A. and the Regional Banks (Switch) Risk weighted assets of business lines before Switch 1 Capital allocated to business lines 1 January 2014 CIB 35% c. 370bn SFS 15% Regional Banks 15% IRB 10% SM excl. Insurance 5% Insurance 10% LCL 10% c. 370bn 2016 targets CIB 30% SFS 15% SM excl. Insurance 6% Regional Banks 17% IRB 11% Insurance 10% LCL 11% Transfer of risks (Switch) 55% Retail banking Savings management & Insurance Regional Banks & Insurance 5% SM excl. Insurance 8% SFS 19% c. 25bn IRB 14% LCL 14% CIB 40% 2016 targets Over the Plan duration, stability of business line risk weighted assets Reinforcement for Retail banking, Savings management & Insurance: 55% of risk weighted assets (+5 points / January 2014) Stability for SFS Decrease for CIB: -5 points, linked namely to the amortisation of discontinuing activities 1. Crédit Agricole S.A. scope 71 I Investor Day 20 March 2014
Profitability Normative profitability of Crédit Agricole S.A. business lines Strong profitability of business lines which consume little regulatory capital: Retail banking, Savings management & Insurance ROTE 45% RoTE of business lines 2013 and 2016 before Switch 40% 35% 30% SM excl. Ins. >35% Insurance c.34% 25% 20% 15% 10% 5% 0% LCL >20% IRB c.20% SFS >10% 1 3 5 7 9 11 13 NB: The size of the bubbles is proportionate to results in 2013 (lighter color) and in 2016 (darker color) Assumption: capital allocated at 9% of Basel 3 risk weighted assets and including main regulatory deductions from the CET1 numerator For Amundi, profitability would be 6bp calculated on basis of AUMs For insurance, profitability would be 13% calculated on basis of 80% of the solvency margin CIB c.12% Allocated capital ( bn) 72 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 73 I Investor Day 20 March 2014
Solvency planning CET1 ratio 9.5% is the level of fully loaded CET1 ratio targeted by Crédit Agricole S.A. (which has no SIFI requirement) At the end of the MT Plan, fully loaded CET1 ratio projected above 10.5%, generating a buffer of 100 bp (i.e. over 3bn) >10.5% Fully loaded CET1 ratio Crédit Agricole S.A. Buffer estimated at end of MT Plan at above 3bn 9.5% Targeted level 7% 31 Dec. 2016 2018 regulatory requirement for Crédit Agricole S.A. 74 I Investor Day 20 March 2014
Solvency planning Fully loaded CET1 ratio 11.2% 8.3% Fully loaded Basel 3 CET1 ratio targets for CA Group & Crédit Agricole S.A. 1st Jan. 2014 31 Dec. 2014 31 Dec. 2015 31 Dec. 2016 12.0% 9.0% Crédit Agricole Group 13.0% 9.8% Crédit Agricole S.A. 14.0% >10.5% Targets mainly achieved through Organic generation of capital Asset disposals and already identified balance sheet transactions Taking into account The weighting of capital and reserves of Crédit Agricole Assurances (at 370%) i.e. 35bn of RWAs for Crédit Agricole S.A. 1 The Switch guarantees between the Regional Banks and Crédit Agricole S.A. (for 87bn of RWAs) eliminated within the Crédit Agricole Group scope A 35% pay-out ratio with scrip dividend in 2014, and, when the 9.5% threshold has been exceeded, an assumption of 50% pay-out ratio in 2015 and 2016 (including 50% in cash) 1. 37bn for Crédit Agricole Group Warning: the above ratios were established on the basis of a number of assumptions. The achievement of these targets will depend on a number of factors, including the future net income of Crédit Agricole S.A. and of Crédit Agricole Group, which is by nature uncertain. 75 I Investor Day 20 March 2014
Solvency planning Crédit Agricole S.A.: fully loaded CET1 ratio and RWAs Fully loaded Basel 3 CET1 ratio - Crédit Agricole S.A. 2.1% ( 0.2% ) 0.3% >10.5% 8.3% 01/01/2014 Fully loaded Basel 3 Retained earnings Change in organic RWAs (excl. weighting of threshold) Action plan & others 31/12/2016 target Basel 3 fully loaded CET1 Risk weighted assets 1 - Crédit Agricole S.A. (in bn) 15 ( 4 ) 3 ( 22 ) 323 c.315 01/01/2014 Fully loaded Basel 3 Organic growth Methodological gains (roll-out) Basel 3 threshold Action plan 31/12/2016 target Basel 3 fully loaded 1. incl. Corporate centre and after Switch ( 87bn) 76 I Investor Day 20 March 2014
Solvency planning Crédit Agricole S.A. Dividend distribution policy Pay-out ratio Conditions / Comments As a reminder 2013 Result 35% Proposal made by the Board of directors to the General Meeting on 21 May 2014 Commitment by SAS Rue La Boétie to opt for the payment of a scrip dividend Confirmation 2014 Result 35% Commitment by SAS Rue La Boétie to opt for the payment of a scrip dividend Assumption 2015 Result 50% MT Plan calculations are based on the assumption of a 50% 1 payment of the dividend in cash Assumption 2016 Result 50% MT Plan calculations are based on the assumption of a 50% 1 payment of the dividend in cash 1. Subject to approval by the General Assembly of Shareholders 77 I Investor Day 20 March 2014
Capital structure at end 2016 Estimations 2014-2016 Capital structure under Basel 3 (phased ratios) Crédit Agricole S.A. Crédit Agricole Group 10.5% 2.0% 8.5% 15.1% 15.5% 15.0% 4.8% 10.3% 2.5% 13.0% Tier 2 1 (grandfathered ) G-SIFI additional requirement Phased Tier 1 (incl. AT1 grandfathered ) 12.0% 2.0% 1.5% 8.5% 3.0% 12.0% 16.5% 1.5% 15.0% Regulatory requirement end 2018 1st Jan. 2014 31 Dec. 2016 target Regulatory requirement end 2018 1st Jan. 2014 31 Dec. 2016 target The G-SIFI additional requirement of 1.5% is taken into account at Crédit Agricole Group level 1. Phased calculations based on Crédit Agricole S.A. s comprehension of the CRR/CRD4 rules applicable to French banks supervised by the ACPR Warning: the above ratios were established on the basis of a number of assumptions. The achievement of these targets will depend on a number of factors, including the future net income of Crédit Agricole S.A. and of Crédit Agricole Group, which is by nature uncertain. 78 I Investor Day 20 March 2014
Leverage ratio: an additional ratio for the analysis of financial strength Relevant at Group level considering internal financing transactions (Crédit Agricole S.A. / Regional Banks) Capital structure at end 2016 Leverage ratio CA Group Regulatory requirement already exceeded Leverage ratio of Crédit Agricole Group - 31/12/2013 3.8% 4.4% CRR definition (CRD4) Basel Committee definition 1 Regulatory requirement at 1 st January 2018 (3%) Crédit Agricole S.A Regulatory requirement of 3% met before 1 st January 2018 Actions to manage the balance sheet size to be pursued A mechanism which centralises the Regional Banks regulated savings (internal financial organisation) which could be optimised or taken into account in the ratio calculation. At stake c. 200bn of the balance sheet size 1. Treatment of insurance equity accounted according to the Basle Committee text of 12 January 2014 79 I Investor Day 20 March 2014
Capital structure at end 2016 Leverage ratio Denominator of Crédit Agricole Group leverage ratio 1 01/01/2014 (in bn) 1,706 127 178 ( 250 ) 1,456 133 178 + 289 ( 147 ) + 16 ( 143 ) ( ) + 17 17 1,471 142 149 52 1,401 1,145 1,128 Stated balance sheet Insurance (and others) Regulatory 2 balance sheet Off-balance sheet trade transactions (stated) Conversion of offbalance sheet (recognition of Treatment of repos collateral) Recognition of netting agreements and add-ons on derivatives CDS sold Regulatory deductions & others Denominator of Basel leverage ratio Balance sheet - others Derivatives Repos Off-balance sheet trade transactions 1. Treatment of insurance equity-accounted according to the Basel Committee text of 12 January 2014 ; 2. FINREP declaration 80 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 81 I Investor Day 20 March 2014
Liquidity management LCR and NSFR Regulatory requirement Ratio at end 2013 Target LCR Crédit Agricole S.A CA Group 60% at 01/01/2015 100% at 01/01/2018 >100% > 100% >80% >100% at end 2014 LCR: convergence levers Improvement of the loan-to-deposit ratio: «freed» resources are allocated to the funding of reserves Optimisation of the securities portfolio: securities which are not eligible to LCR reserves are «exchanged» for eligible securities Reduction of the impact of rating triggers NSFR 1 CA Group 100% at 01/01/2018 100% excl. impact of repos / reverse repos 100% in 2016 2 NSFR: final text not yet disclosed The latest Basel Committee advisory text published in January 2014 gave favourable clarifications, particularly for retail banking specificities It is very disadvantageous for repo/reverse repo activities («matched ST funding activities») Impact of these «matched ST funding activities»: 40bn, equivalent to 110mn in revenues in 2013 1. Calculation based on Crédit Agricole S.A. s understanding of Basel Committee advisory text published in January 2014, taking into consideration that the text includes accounting rules subject to interpretation ; 2. Calculation based on Crédit Agricole S.A. s understanding 82 I Investor Day 20 March 2014
Liquidity management MREL ratio MREL ratio (minimum required eligible liability) for Crédit Agricole Group estimated at 12% at 31/12/13 MREL ratio numerator ( bn) Definition: regulatory capital, hybrid debt and LT unsecured debt with residual maturity >1 year Denominator ( bn) Definition: total regulatory balance sheet 31/12/2013 31/12/2013 1,456 1,039 142 26 146 ST market funds Repos 1,039 439 Non-bailinable debt (of which covered deposits, covered bonds, repos, other) LT market funds 52 Non covered retail deposits 638 87 Cash balance sheet - liabilities Customer-related funds Capital & similar items 82 Waterfall Resolution 466 LT senior unsecured, ST unsecured & wholesale Of which LT unsecured debt of residual maturity > 1 year Equity and hybrids 174 92 82 MREL ratio numerator Total regulatory balance sheet The senior unsecured debt is covered by 82bn of equity and hybrid securities 83 I Investor Day 20 March 2014
Financial summary 1 Revenues and operating expenses 2 Focus on Corporate centre 3 Profitability 4 Solvency planning 5 Liquidity management 6 Appendix 84 I Investor Day 20 March 2014
Detailed calculation and assumptions Detailed calculation of Basel 3 fully loaded CET1 ratio at 01/01/2014 CET1 ratio - Basel 3 fully loaded (01/01/2014 in bn) Crédit Agricole Group Crédit Agricole S.A. Estimated shareholders equity Group share 75.6 41.9 + Limited recognition of minority interests 1 1.9 1.7 - Goodwill and intangibles (16.3) (15.5) - Financial stakes either >10% or equity accounted 1 (4.1) (3.7) - DTA carryforwards (0.2) (0.2) - DTA timing differences 1 (1.9) (1.2) - EL equity (0.3) (0.1) + Application of threshold rules (15%) 1 6.0 3.9 = Common Equity Tier 1 (CET1) 60.7 26.8 / RWAs 544 323 CET1 ratio 11.2% 8.3% 1. Items phased on a yearly 20% basis for the phased CET1 ratio calculation 85 I Investor Day 20 March 2014
Solvency planning Crédit Agricole Group: fully loaded CET1 ratio and risk weighted assets Basel 3 fully loaded CET1 ratio - Crédit Agricole Group 2.5% 0.2% ( 0.2% ) 0.3% 11.2% 14.0% 01/01/2014 Basel 3 fully loaded Retained earnings Issue of mutual shares Organic RWA growth (excl. Weighting of the threshold) Action plans & other 31/12/2016 target Basel 3 fully loaded CET1 Risk weighted assets - Crédit Agricole Group ( bn) 25 ( 3 ) 6 ( 22 ) 544 c.550 01/01/2014 Basel 3 fully loaded RWAs Organic growth Methodological changes (roll-out) Basel 3 threshold Action plans 31/12/2016 target Basel 3 fully loaded 86 I Investor Day 20 March 2014
Capital structure at end 2016 Capital management Solvency Leverage Bail-in CET1 AT1 management AT1 issuance > 4bn in total over the period 2014-2016 to: Offset regulatory grandfathering of Tier 1 notes by 10% a year ( 0.9bn a year for Crédit Agricole Group, i.e. 3.6bn over the period 2013-2016) Achieve phased Tier 1 ratios of 13% for Crédit Agricole S.A. and 15% for Crédit Agricole Group Capitalise on market opportunities to strengthen the financial structure and prepay hybrid Basel 2.5 instruments Success of inaugural AT1 issue: $1.75bn in January 2014 Included in 4bn target for total AT1 issuance over the period 2014-2016 Tier 2 management No need for Tier 2 issues over the plan period 87 I Investor Day 20 March 2014
88 I Investor Day 20 March 2014 Focus on operating performance
Focus on operating performance 1 Crédit Agricole Group: operational excellence 2 Crédit Agricole Group is investing and continuing its cost- control efforts 89 I Investor Day 20 March 2014
1 Crédit Agricole Group: operational excellence Group and Retail Banking cost/income ratios among the best in the industry Normalised cost/income ratios for French banking groups 2013 Retail Banking in France Cost/income ratio 2013 67% 67% 69% 70% 66% 65% 62% 54% Crédit Agricole Group (1) BNP Paribas (2) Crédit Agricole S.A. (1) Société Générale (3) BPCE (4) Regional Banks LCL Peer average (5) (1) Pro forma and adjusted for issuer spread, DVA/CVA and loan hedges (2) Adjusted for own debt revaluation and DVA (3) Adjusted for own debt revaluation, accounting impact of CVA/DVA on revenues and impact of EURIBOR settlement with the European Commission on operating costs (4) Adjusted for own debt revaluation (5) Société Générale, BNPP, Caisses d Epargne, Banques Populaires 90 I Investor Day 20 March 2014
1 Crédit Agricole Group: operational excellence Best-in-class cost/income ratios in most of our business lines Asset management Cost/income ratio 2013 Insurance operating costs/premiums earned (2) 2013 55% 66% 2.2% 2.5% 3.2% 4.9% Amundi Peer average (1) Crédit Agricole Assurances Société Générale (3) CNP BNP Paribas (4) 72% Asset Servicing Cost/income ratio 2013 86% French Corporate and Investment banks Cost/income ratio 2013 60% 60% 61% 69% CACEIS Peer average (5) Crédit Agricole (6) Natixis (7) Société Générale (8) BNP Paribas 1. Franklin Templeton, T Rowe Price, Invesco, Schroders, Blackrock, Natixis GAM, AllianceBernstein, Legg Mason; 2. Source: financial communications; 3. Premiums; 4. Gross premiums earned; 5. BP2S, SG2S, RBC Investor and Treasury Services, BONY Investment Services, State Street 6. CIB pro forma for equity accounting of UBAF under proportionate method in 2013 and restated for loan hedges and CVA/DVA impacts; 7. Corporate Banking + GAPC; 8. Corporate Banking restated for CVA/DVA accounting impacts and Euribor settlement; 9. Corporate and Investment Banking (excl. DVA exceptional impacts) 91 I Investor Day 20 March 2014
2 An ambitious investment plan to support our Medium Term targets c. 3.7bn in cumulative investment over the plan period, including c. 2/3 in retail banking c. 1.8bn c. 0.7bn 1 c. 1.2bn c. 3.7bn 2 35% Increased investments under the Medium Term Plan c. 3.7bn of investment dedicated to: Supporting business development Improving operational efficiency 35% of investments are non-recurring and will support the Medium Term Plan initiatives 65% Recurring investments Three investment priorities: Regional Banks LCL Other business lines & CA S.A. Group Total Human resources Technology Cost savings 1. Prorata temporis of the exceptional 5-year 400m investment plan in addition to LCL's ongoing investment ; 2. Excluding acquisitions. Investments included in the 2014-2016 financial plan 92 I Investor Day 20 March 2014
2.1 Crédit Agricole Group is investing in human resources to meet the transformation challenges of the next few years Anticipate and support our businesses transformation Prepare for the future Need to support the transformation of our retail networks in their transition to multi-channel banking Train customer advisors to handle multi-channel mode Reallocate the commercial time freed up by digital Help employees to adapt to new jobs Strengthen expertise in specialised businesses (high net worth individuals, professionals, SMEs, corporates, etc.) Recruit digital specialists (CRM, Big data) Exceptional investment effort planned Over 250m to be invested in human resources from 2014 to 2016 to meet transformation challenges Develop skills and resources of the Group s internal training institute (IFCAM) Continue recruiting considering natural attrition Crédit Agricole Group is one of the largest recruiters in France Concrete actions to foster day-to-day employee commitment Regular measurements of Group employees commitment allowing them to express themselves, followed by action plans Pro-active management of talent and key skills Will to involve concerned parties in forward management of jobs and employment Proactive approach to promote diversity 93 I Investor Day 20 March 2014
2.2 Crédit Agricole Group is investing in IT convergence Accelerate the Group IT convergence NICE, the largest IT project in the European banking industry, serving 21 million customers End-2013: Regional Banks have all switched to the common NICE system New initiatives in 2014-2016 Development of new multi-channel and specialised markets functionalities on the NICE platform Broader applications convergence between LCL and the NICE platform Launch of a Group IT production sharing programme: first step of the project with Crédit Agricole S.A., second step with the Regional Banks Extension of the Group s Payment platform to Cariparma and CA Bank Polska 94 I Investor Day 20 March 2014
2.3 Crédit Agricole is taking further action to cut costs MUST, a 650m cost savings programme already in progress Target: 650m in 2016 vs. end 2011 across the Crédit Agricole S.A. scope 3 areas covered: IT IT: rationalise the cost of maintenance, workstations and installed machine base, lower the cost of service providers External expenses: renegotiate master agreements, pool purchases, rationalise suppliers Real estate: review real estate blueprints, optimise facility management costs External expenses Real estate Total MUST programme 1. Scope of MUST programme 2011 cost base ( bn)¹ 2.2 2.0 0.9 5.2 Savings targets 650m c.13% 125 Savings achieved in 2012 226 Savings achieved in 2013 Progress at end 2013 ( m) 351 320 Total savings achieved vs. 2011 31m above target Target at end 2013 650 Total 2016 target Programme covers a cost base of 5.2bn, i.e. 38% of Crédit Agricole S.A. s 2011 costs 95 I Investor Day 20 March 2014
2.3 Crédit Agricole is taking further action to cut costs Cost-cutting already well underway: example of Crédit Agricole S.A s Corporate centre 10% cost savings on costs achieved since 2011 by Crédit Agricole S.A. s Corporate centre in an environment of sharply increasing tax pressure Trends in costs ( m) 981 915 916 845 899 816 Cost savings driven mainly by: Optimising headcount: Voluntary departure plan in 2010 (internal headcount down 4% from 2011 to 2013) coupled with insourcing efforts (18% reduction in external service providers from 2011-2013) All in all, a 10% decrease in FTEs (internal and external) from 2011 to 2013 2011 2012 2013 Total costs Costs excluding taxes Contributions to the MUST programme: c. 100m at end 2013 vs. 2011 out of 351m total savings achieved A 10.9% decrease in costs excluding taxes 96 I Investor Day 20 March 2014
2.3 Crédit Agricole is taking further action to cut costs New initiatives planned for 2014-2016 Continuation of cost-cutting programmes The whole Crédit Agricole Group to benefit from MUST programme (external expenses and real estate) Project of partial replacement of the 5,000 natural departures expected for Crédit Agricole S.A. over the plan period CACIB: outsourcing and offshoring in IT and back-offices, cost reduction in discontinuing activities A voluntary cost savings plan at CACF A cost optimisation plan for CA Private Banking 97 I Investor Day 20 March 2014
2.3 Crédit Agricole Group continues efforts to reduce costs by up to 950m by 2016 Main costs savings actions by 2016 ( m) 950m Cost savings planned for 2014-2016 in addition to those already achieved as at 31/12/2013 300 240 190 220 430 520 Regional Banks Crédit Agricole S.A. Cost/income ratio down by over 2 points 1 for Crédit Agricole Group and by over 3 points 1 for Crédit Agricole S.A. in 2016 compared with 2013 Future MUST Future NICE New Regional Banks initiatives New Crédit Agricole S.A. initiatives 2016 target 1. Pro forma for equity accounting of entities proportionately consolidated in 2013, restated for issuer spreads, CVA/DVA, loan hedges 98 I Investor Day 20 March 2014
99 I Investor Day 20 March 2014 IV Business lines 2016 ambitions
100 I Investor Day 20 March 2014 Business lines 2016 ambitions Retail Banking
Transformation tailored to each network to meet new customer expectations, in line with the specific features of our banks and customer groups c. 7,000 branches Homogenous geographical coverage c. 1,900 branches Strong presence in large towns and cities @ The multi-channel retail bank close to its customers Leading relationship and digital bank in urban areas Full-online bank 1. Group Crédit Agricole revenues estimations Our 2016 targets: Achieve revenues 1 of c. 19.5bn in French retail banking Increase our market shares in all customer segments by 2016 101 I Investor Day 20 March 2014
102 I Investor Day 20 March 2014 Business lines 2016 ambitions Retail Banking Crédit Agricole Regional Banks
Leading retail bank in France Leading retail bank present in all French territories and covering all customer segments No. 1 bancassurer in France 4 Leader in customer product penetration Unrivalled geographical coverage (over 7,000 branches) Regional Banks that contribute to socio-economic development of their local regions Leading in penetration rate in all customer segments 1 29% of individuals 85% of farmers 25% of small businesses 37% of corporates No. 1 bank for young people Leader in market shares 2 Lending: 17.1% Deposits: 20.5% Securities (individuals): 19.1% Payments: 21.3% 3 15% penetration rate in life insurance 8.4 million personal and property insurance contracts at end-2013 Average number of products and services per demand deposit account among the highest in the market and rising sharply 6.8 8.7 2000 2012 1 Main and secondary bank penetration rates - CSA BAROC report 2012, CA report May 2011, TNS Sofres survey August 2013, CSA report March 2012-2 Reports on retail banking in France, market shares at September 2013, ECO, Banque de France data, Surfi returns - 3 Market share in number of payments (electronic, cards) at 31 December 2013, CA Payments - 4 CSA OPERBAC report 2012 103 I Investor Day 20 March 2014
A strong profitable bank Strong growth in revenues Growth 2008-13 Revenues 1 ( m) Best cost/income ratio among peers ** Average of French branch networks of BNPP, SG, LCL, BP, CE Cost/income ratio in 2013 (%) 11,692 14,873 65.1% 54.0% 2008 2013 Peer average** Sharp rise in NIGS Stringent risk management Growth 2008-13 NIGS 1 ( m) 3,666 60 40 110% 100% 1,994 20 90% - 2008 2009 2010 2011 2012 2013 80% 2008 2013 Coverage ratio (incl. collective provisions) Cost of risk/loans outstanding (bp) 1. Contribution of the Regional banks to Crédit Agricole Group revenues and NIGS 104 I Investor Day 20 March 2014
Customer expectations are changing radically New requirements in terms of access Issues of confidence and added value Proportion of customers who have used the following relationship channel with their bank in the last 12 months 1 Branch 88% 77% Customers are changing the way they bank. In today's digital world, they now expect Continuous access Customers consider their relationship manager vital for their key financial transactions 3 If you had a choice of all banking channels, which would you prefer for: Internet 50% 64% Multi-channel rather than online banking (77% 2 of French people are not prepared to become Taking out a home loan Relationship manager 94% Internet 3% Mobile 13% 21% 2010 2012 customers of an online bank only) First-class Web and Advice on complex financial products and/or investments 86% 4% Mobile technology 1. Source: McKinsey consumer survey 2010 and 2012 France ; 2. Source: LH2, May 2012 ; 3. Source: LH2, July 2013, Survey sample of 1,010 people aged from 18 to 70, either Regional bank s customers or LCL customers 105 I Investor Day 20 March 2014
Crédit Agricole in 2016: the best of banking for everyone and everywhere with the multi-channel retail bank close to its customers More practical A fully multi-channel, fully digital bank that facilitates and improves the customer relationship Closer More expert A closer, more expert bank offering a customer relationship based on human contact and geographical proximity More participatory Cooperative values that strengthen the human relationship and loyalty to the Bank 106 I Investor Day 20 March 2014
A Implementation of the multi-channel retail bank model close to its customers 107 I Investor Day 20 March 2014
A Implementation of the multi-channel retail bank model close to its customers A more practical bank: creating a fully multi-channel, fully digital bank that facilitates and improves customer relationships More practical 100% of offers and transactions available through all remote channels (internet, mobile, telephone) with interoperability between channels A proactive bank with more responsive relationship managers available through all channels: New means of communications with relationship managers (e-mail, chat, video, etc.) Longer branch opening hours Complaints handled within 48 hours Effective CRM system to better anticipate customer needs Setting up of Customer Relation Centres offering extended opening hours and a 24/7 hotline Paperless by 2016: 100% of all documents will be electronic A multi-channel bank supported by the deployment of new resources: Gradual deployment of all multi-channel bank functions on the Regional Banks' common information systems platform (NICE) Full website architecture, from national to local, providing means both to capture new customers and deliver services to existing customers 108 I Investor Day 20 March 2014
A Implementation of the multi-channel retail bank model close to its customers A closer, more expert bank: customer relationships based on human contact and geographical proximity Closer More expert Maintain a strong nationwide presence: An extensive branch network providing geographical proximity for all customers Dedicated multi-channel relationship manager for each customer in order to ensure a better quality of relationship: Pivotal role of the relationship manager in the customer relationship Multi-channel relationship manager has the overview of the customer s actions and transactions, regardless of the channel used Strengthen expertise in the branch network by: Improving the skills of the relationship managers, and Increasing the availability of specialists: both for managing key life events (inheritance, divorce, etc.) and for specialised services (insurance, real estate, wealth management, small businesses) A transformation of the model supported by significant investments in staff (skills of advisers and management) 109 I Investor Day 20 March 2014
A Implementation of the multi-channel retail bank model close to its customers A more participatory bank: cooperative values that sustainably strengthen the banking relationship and loyalty to the Bank More participatory Expand cooperative membership to 10 million members by 2016 Promote the value of cooperative membership and reinforce the relationship between the bank and its members Continuously foster the Group's cooperative and mutualist principles and values in the daily relationship with our customers and through a strong involvement in local life (leading financier of the local regions) Ongoing commitment to deliver greater customer satisfaction: Service culture underpinning all our actions Supporting our customers during good times and bad Enhancing customer loyalty Facilitating our customers' geographical mobility We intend to become leaders in customer recommendation (NPS) 110 I Investor Day 20 March 2014
B Winning new customers Individual customers Specific customer segments In the individual market, step up new customer capture: + 1pt in penetration rate + 1pt market share gain in home loans Innovative solutions for young people Accelerate consumer finance: + 3bn of loans outstanding in 2016 (20% increase vs. 2013) Become the leading bank in property & casualty insurance by 2016 by increasing cross-selling to our customers Increase internal ownership rate from 31% 1 to 40% Offer innovative solutions and approaches in wealth management: + 21bn of deposits from high net worth customers in 2016 (increase of c.10% of outstandings) Support small businesses by providing specific payment and insurance solutions and support entrepreneurs in their business start-ups: 20% market share of start-ups in 2016 Implement a dedicated process and offer a specific range of products for Intermediate-sized enterprises Increase penetration rate to 40% (vs. c.30% currently) 1. OPERBAC CSA report February 2013 111 I Investor Day 20 March 2014
B Achieve our ambitions in our areas of excellence Farming and food processing Housing Energy and environment Health & ageing Long term stakes Maintain a dynamic agricultural fabric in the regions Promote access to housing of all French citizens by being present in all aspects of the sector Facilitate the energy transition process and meet new needs Accompany the ageing of population in our territories Leadership positions Over 85% penetration rate among French farmers 42% market shares on loans in the food processing industry in France Leader on home loans for individuals Investment solutions for all matters relating to property assets Amundi, 1 st SRI asset manager in France Leading expertise for specialised financing Leadership in savings and insurance (retirement anticipation and protection) Our ambitions for 2016 Strengthen our leadership in the farming segment In food processing, extend our position as leading player in France to the rest of Europe Finance and support 90% viable installations for young farmers Maximise synergies between banking, insurance and real estate businesses and increase equipment rate in multi-risk home insurance policy (target 50%) Be a pioneer in providing finance through digital channels Develop responsible savings: target of 100bn SRI outstandings Support energy and environmental projects in all regions Extend our eco-renovation offer to the whole territory Aim for leadership in retirement savings, with a leading consultancy approach Become a major player in group insurance Market share target of 5% in health insurance 112 I Investor Day 20 March 2014
C Strengthen our leading position in operational excellence A 3 year 1.8bn investment plan to support our business development (70% of capex) and operational efficiency Raise the proportion of customer-facing staff to 80% in 2016 1.8bn of investments by 2016 Capitalise on the Regional Banks' convergence to a unified, powerful IT platform to optimise and simplify customer processes 0.3 Operational efficiency Complete pooling of electronic payments activities on a single shared platform and optimise IT and back office management of on-balance sheet savings Optimise purchases (general purchases and consulting services) by leveraging actions already taken under the MUST programme Complete the dematerialisation process: aim to be fully paperless" by 2016 1.5 Development (transformation of distribution model; branch refurbishment) Drive the cost/income ratio to below 54% in 2016 113 I Investor Day 20 March 2014
Multi-channel retail bank close to its customers Summary Key strategic areas of focus 2016 Targets A Deploy the multi-channel bank model B C A more practical bank: fully multi-channel and fully digital A closer, more expert bank offering customer relationships based on human contact and geographical proximity A more participatory bank A transformation of the model supported by significant investments in staff (skills of advisers and management) Continue to win new customers and achieve our ambitions in our areas of excellence Strengthen our leading position in operating excellence 2016 revenues c. 15.5bn Leadership in customer recommendation + 1pt penetration rate gain in individual market Market share gains in all customer segments 2016 cost/income ratio <54% 10 million cooperative members 114 I Investor Day 20 March 2014
115 I Investor Day 20 March 2014 Business lines 2016 ambitions Retail Banking LCL
Leading relationship and digital bank in urban areas Strong positions in urban areas and in specific customer segments Une forte présence dans les grandes agglomérations LCL has a strong presence in major urban areas with a high population density: 60% of our 1,903 branches are in urban areas 40% located in Paris/Lyon/Marseille and their surrounding areas LCL: 1,903 branches in France, mainly in urban areas Strong positions in specific customer segments: Major corporates 1 in 3 are customers Small businesses 30% penetration rate of pharmacies High net worth individuals No. 2 in private banking in France with 39bn assets under management Students 500,000 customers 116 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas Strong financial fundamentals Sound financial fundamentals: 129% 124% Trends in loan to deposit ratio Rebalanced loan to deposit ratio of 109% 1 at end 2013 115% 116% 116% 115% 116% 115% 112% 109% 109% Q2-11 Q3 Q4 Q1-12 Q2 Q3 Q4 Q1-13 Q2 Q3 Q4 Significant reduction in costs in the past few years: One of the only French banking groups to have decreased its operating costs over the period 2007-2013 Operating cost CAGR: -1.2% Productivity efforts made since 2007 with a reduction of almost 2,600 FTEs (c.12%), mainly in back offices Reduction in FTEs over the period 2007-2013 -12% 1. Outstandings at period end, deposits net of CDC centralisation and including LCL bonds 117 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas A 5-year managerial, technological and organisational transformation plan Urban customers Young working people, students Small businesses High net worth individuals Corporates Strong expectations in terms of Autonomy (use of digital) Responsiveness, anytime anywhere Easy access to experts A new value proposition: "The whole of LCL à la carte" Personalisation, service continuity and choice Continuity of service, no matter when or where, face to face or distant Customer advisor available 6 days a week until 10pm Customer query dealt with on first contact, no matter who the contact is All transactions, products and after-sales service available online A flawless service at each stage of the customer experience Simplification of endto-end customer transactions Expertise and tailormade service for specialised customer segments A service culture relayed by all LCL employees The entire bank is driven by the desire to satisfy its customers A plan which makes LCL a bank fully in tune with the requirements of its urban clientele A far-reaching transformation plan supported by a 5-year investment programme of 400m 1 1 For LCL: exceptional investments budget in addition to recurring investments 118 I Investor Day 20 March 2014
119 I Investor Day 20 March 2014 LCL's new model
Leading relationship and digital bank in urban areas A relationship model based on a tailored approach and service continuity A model tailored to the lifestyle and consumer habits of an urban clientele: extended contact times, a full offer on distance channels, queries dealt with on first contact and cooperation between the various parties involved 10 regional Customer Relationship Centres in France in addition to the branch network dedicated to dealing with all customer requests 6 days a week until 10pm Differentiated expertise and services depending on expectations of each type of customer (individuals, high net worth, small businesses, corporates, institutionals) at the time of specific support actions at key stages 120 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas A distribution model in tune with new customer behaviours A bricks and mortar network adapted and modernised to cater for changing customer behaviours: branches opened, transferred or closed Increase in the number of customer advisors, both in the branches and through distance channels, with Dedicated relationship managers for high net worth and professional customers Pools of advisors for individual customers for greater responsiveness and availability Customer advisors and experts in the regional Customer Relationship Centres supporting the branches and online customers Availability of all LCL products and services, for greater speed and simplicity: full online LCL on internet and mobile with improved security 121 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas Improving operational efficiency Simplify and digitise end-to-end customer transactions Industrialised back offices for simple transactions and specialised back offices for high value-added customer segments or complex transactions (tailored approach) Partial replacement of natural staff attrition expected by 2016 to reach a proportion of 78% of the workforce facing customers 122 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas Strong business momentum In personal banking, increase the number of products per customer and accelerate new customer acquisitions (+360,000 individual customers) Strengthen our position as no. 2 private bank in France and target of Top 5 ranking in the wealth management market: 2.5bn of additional resources Become the leading bank for professionals, small businesses and corporates 123 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas A 3-year 300m investment programme 1 to deploy the new model 3 broad areas of investment to implement LCL's transformation plan 160m for new IT developments Development of digital banking tools: implementation of the foundations required for full digitality and interoperability of channels Customer Relationship Management (CRM) Breakdown of investments to 2016 ( m) 80 60m invested in the branch network Refurbishment of branches Instalment of new generation ATMs 60 300 80m to support the transformation Change management plan Training 160 IT Branch network Remodelling support Total 1. 400m over 5 years 124 I Investor Day 20 March 2014
Leading relationship and digital bank in urban areas Summary Key strategic areas of focus 2016 Targets A relationship model based on a tailor-made approach and service continuity A distribution model in tune with new customer behaviours Improved operational efficiency Strong business momentum Gain new customers 360,000 additional individual customers with a focus on young professionals, students, families and high net worth individuals 18,000 new customers in the small business and professional segments 40% of major corporates customers of LCL Improvement of productivity through Digitisation of all customer actions and transactions (80% target for 2016) c.78% of staff to be customer-facing All products and contracts available online 2016 revenues c. 4bn 2016 cost/income ratio c.64% 1 1. Excluding expenses related to investment plan 125 I Investor Day 20 March 2014
126 I Investor Day 20 March 2014 Business lines 2016 ambitions Retail Banking BforBank
Full-online only bank for busy customers on the move Strategic positioning and expectations of our customers Value proposition: A full-online banking service 2016 Targets Bank launched at end 2009 with a online savings offer aimed at the more affluent end of the market Today, the brand is known by one in two affluent customers BforBank has a solid business franchise 115,000 customers at end 2013 3.2bn in savings and a 75% loyalty rate Award-winning customer service Inference Operations - Viséo Conseil survey Online banks category BforBank currently operates in the savings market, but plans to roll out a comprehensive range of online banking products and services As of 2015, broaden the offer to encompass current account banking In 2016, launch of home loans The model could be exported to other European countries (e.g. Italy and Germany) c. 170,000 accounts (demand deposit and passbooks) in 2016 +25,000 demand deposit accounts a year from 2015 4.5bn in deposits 127 I Investor Day 20 March 2014
128 I Investor Day 20 March 2014 Business lines 2016 ambitions Retail Banking International Retail Banking
Italian market expected to benefit from the economic upturn from 2014 Strong fundamentals High level of household wealth Net wealth per capita among the highest in Europe A continuously high savings rate, which serves as a safety buffer and little debt Household indebtedness: 65% of disposable income compared with almost 80% for French and German households A resilient property market Europe's second-largest industrial power Industry positioned in high-margin niche markets and focused on exports Second place (behind Germany) in the global competitiveness sector rankings 250 200 150 100 50 0 Net financial wealth, as a % of GDP Belgium UK Italy France Germany Spain Source: Eurostat A gradually improving economic environment Return to growth expected in 2014 (+0.7% in 2014, +0.9% in 2015) after several difficult years (8% contraction in GDP between 2008 and 2013) Alleviation of pressure on Italian sovereign debt Decline in the debt-to-gdp ratio in 2015 thanks to a fall in sovereign yields, coupled with a recurring primary surplus GDP growth 0.7% 0.9% 0.8% -1.9% 2013 2014 2015 2016 Source: Crédit Agricole SA 129 I Investor Day 20 March 2014
Cariparma, a bank operating in Italy's most prosperous regions 1.7 million customers 1.5 million individual customers 240,000 small business customers 15,000 corporate customers Exposure to individual customers, specifically the high net worth segment, above the Italian banking sector average High contribution clientele Revenue per customer > 920 36bn in on-balance sheet deposits 51bn in off-balance sheet savings 33bn in loans outstanding 8 th largest retail bank in Italy with 920 branches Backbone in Italy for all the Group's businesses Operating in the prosperous regions of Northern Italy which have a higher GDP per capita and a lower unemployment rate than the French average GDP per capita by region, in K in 2012 GDP per capita 30,000 GDP per capita 29,000-30,000 GDP per capita 25,000-29,000 GDP per capita 18,000-25,000 GDP per capita 18,000 34.5 27.9 19.7 1. Includes deposits and bank bonds (based on Bank of Italy data) Source: Italian statistics, 2013 27.3 33.1 33.8 31.5 28.1 29.5 23.3 29.1 25.6 22.3 29.2 20.0 16.8 16.4 17.2 18.0 16.6 On-B/S deposits market share, June 2013 1 >10% 5-10% 2-5% 1-2% <1% Not present 2.8% 6.5% 1.2% 8.5% 1.8% 1.8% 0.7% 13.4% 1.1% 5.2% 130 I Investor Day 20 March 2014
Cariparma, profitability maintained in a difficult environment Profitability maintained in a difficult Italian environment Cariparma, second rank in terms of profitability Normalised 2013 profitability 1 (%) 9.2% 6.1% 6.0% 4.6% 4.6% 3.1% 2.9% 2.5% 17% despite very limited recourse to carry trade on Italian sovereign debt Exposure to Italian sovereign as a percentage of total assets 3 15% 15% 13% 12% 11% 11% 9% 6% 0.5% Peer A Cariparma Peer B 2 Peer C Peer D Peer average Peer E Peer F Peer G Peer H -0.5% Peer A Peer B Peer C Peer D Peer E Peer F Peer G Cariparma Peer H supported by the comprehensive range of Group business lines, generating strong synergies: + 200m in revenues for Cariparma thanks to cross-selling + 200m in revenue synergies for other business lines 1. 9 months 2013 for peers. Normalised profitability calculated on the basis of annualised net income (when net income not available, pre-tax income multiplied by 60%) as a ratio of 9% of risk-weighted assets 2. After adjustment for provisions recognised in Cariparma's financial statements in Q1 2013 and 2012, as indicated in Q1 2013 3. At 30/06/2013, sample of 8 Italian banks N.B. Sample of 8 banks: Unicredit Commercial Italy, ISP Banca dei Territori, BNL, Credem, UBI, BPER, BPM, BP Source: Annual reports, Exane report of 4/11/2013 131 I Investor Day 20 March 2014
Cariparma, a solid balance sheet on which to build the future 3.1bn surplus of deposits over loans at end 2013 Doubtful loans ratio well below the average of Italian peers Loan-to-deposit ratio 1 in 2013 (%) Impaired loans ratio 2 108% 15.9% 91% 10.4% Cariparma Italian peers Cariparma Italian peers 3 A surplus liquidity position enabling Cariparma to capitalise on the recovery of lending activity in the Italian market A bank in a better position to withstand a deterioration in the economic environment, thanks in particular to its customer profile 1. Deposits including bank bonds N.B.: sample of 11 banks: Unicredit Commercial Italy, ISP Banca dei Territori, Credem, BPV, UBI, BNL, BPER, Carige, BPM, BP, MPS. Peer ratios calculated at 30/09/2013 2. Sofferenze + incagli + other crediti deteriorati 3. Sample of 11 banks: Unicredit Commercial Italy, ISP Banca dei Territori, Credem, BPV, UBI, BNL, BPER, Carige, BPM, BP, MPS. Peer ratios calculated as of 30/09/2013 Source: annual reports 132 I Investor Day 20 March 2014
Cariparma, an investment plan A development plan designed to gain market share whilst maintaining balance sheet equilibrium Step up cross-selling of Group products (insurance, savings management, etc.) Gain market share in selected customer segments through synergies with other Group business lines: intermediate-sized enterprises, high net worth individuals Become the bank of choice for agribusiness in Italy Strengthen our positions in Veneto and Liguria through regional action plans Adapt the distribution model to meet changing customer expectations Reorganise and modernise the branch network Develop multi-channel distribution, online banking and digital innovations Continue to industrialise processes Centralise some back office functions, automate branches, etc.: c.720 departures by 2015 (9% of 2012 headcount) Industrialise credit and collection processes Develop Group convergence (shared applications, tools, payment synergies, etc.) and transfer know-how A c. 320m investment plan from 2014 to 2016 to support our ambitions, of which 180m additional investment to support growth 133 I Investor Day 20 March 2014
to capture the rebound in the Italian market Cariparma's 2016 ambitions Loans and deposits ( bn) Revenues ( bn) Cost/income ratio Cost of risk +2% p.a. +5% p.a. 38.3 38.2 36.2 33.1 1.6 0.1 0.1 1.8 60% c.52% 128 bp 68 bp Deposits Loans 2013 2016 Market Organic 2013 2016 effect 1 growth 2 2013 2016 2013 2016 +5% growth in number of customers over the period 1. Assuming 2% growth a year on average in lending over the period and an increase in net interest margin on lending, decrease in revenues other than interest margins and fee and commission income 2. Market share gains in lending and increase in fee and commission income driven by development of Group synergies (insurance, savings management, etc.) 134 I Investor Day 20 March 2014
Outside Italy, focused development of our international retail banks Other IRB entities 2016 ambitions Recovery in organic revenue growth in Poland after several years of decline in consumer finance origination Focused, profitable growth in our other markets (Ukraine, Morocco, Egypt) In all countries: Support French intermediate-sized enterprises and CACIB's major clients Develop agribusiness Improve operational efficiency Roll out MUST programme Rationalise processes Cost/income other IRB entities excl. Cariparma 1 (%) Maintain a deposit surplus for the business line, providing a good level of financial autonomy Loan-to-deposit ratio 1 (%) IRB revenues excluding Cariparma 1 ( bn) % p.a. 0.75 +3% 0.8 0.40 0.5 +9% +8% % p.a. 1.1 +10% 2 0.6 58% 59% c. 52% 102% 93% 95% 0.35-4% 0.3 +13% 0.5 2010 2013 2016 Poland Other countries (Ukraine, Morocco, Egypt) 2010 2013 2016 2010 2013 2016 1. Poland, Ukraine, Morocco and Egypt 2. At constant exchange rates, growth is 8% p.a. 135 I Investor Day 20 March 2014
136 I Investor Day 20 March 2014 Business lines 2016 ambitions Savings Management and Insurance
137 I Investor Day 20 March 2014 Business lines 2016 ambitions Savings Management and Insurance Crédit Agricole Assurances
A full-fledged insurer, diversified through 3 businesses 1 A multi-business bancassurance model supported by first-class banking and financial partners Savings / Retirement Death & disability/ Health/Creditor Property & Casualty % of premium income (2013 premium income: 26.4bn) 78% 13% 9% driven by the Crédit Agricole Group branch networks and financial partners both internal and external to the Group rounded out by direct business in other markets 1. Business scope: Savings/Retirement encompasses life insurance and retirement savings products; Death & disability/health/creditor encompasses health insurance, creditor insurance and various individual protection products (life s accidents, funeral costs, long-term care, etc.); Property & Casualty encompasses individual car and home insurance, agricultural and professional insurance and legal protection 138 I Investor Day 20 March 2014
A leading bancassurer in Europe in all its businesses and a significant position among insurance groups 9 th largest European insurance group 2 nd largest Life/Savings insurer in France 2012 premium income for the 9 leading European insurers ( bn) 2012 premium income ( bn) Axa Allianz Generali Zurich Prudential Aviva Talanx CNP CAA BNPP Cardif Generali Société Générale Axa ACM 13.2bn CNP CAA 23.2bn Allianz Covéa No. 1 bancassurer in France and Europe No. 4 death & disability insurer excluding creditor insurance in France No. 7 property and liability insurer 1 in France 1. Covers the Pacifica scope in France: car/home/health/life's accidents, legal protection, etc. Source: At end 2012, Argus de l assurance rankings published in December 2013; figures gross of reinsurance, excluding acceptance, for death & disability insurance 139 I Investor Day 20 March 2014
A significant recurring contribution to Crédit Agricole Group's results 2013 premium income 1 : 26.4bn Net income Group share: 1bn +5.5% p.a. +3.8% p.a. 20.2 24.6 28.3 24.9 23.2 26.4 822 838 983 1,081 72 3 712 2 992 398 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 1. Restated for BES Vida, which was sold to BES in Q2-12 2. Greece impact 3. Impact of change in financial structure A Cost/income ratio of 26.4% and a combined ratio of 95.8% 4 in 2013, thanks to strong operational integration with the retail networks (banks and partners) enabling good cost control and excellent underwriting quality 4. Net of reinsurance, Pacifica scope 140 I Investor Day 20 March 2014
CAA Group's 2016 ambitions Our ambition: to be the insurer of choice for Crédit Agricole Group customers and contribute to Crédit Agricole Group's growth and leadership in Europe 4 key strategic areas of focus 1 2 3 4 Savings/Retirement Maintain strong growth momentum in life insurance funds under management by targeting development priorities (new products, high net worth individuals) Death & disability/health/creditor Develop our positions by enhancing our product offers and commercial approach and by establishing ourselves in the group insurance market Property & Casualty Increase the number of products owned by the clients of our branch networks in the individual, farming and small business markets International Continue our development, mainly in Europe Contribute actively to Crédit Agricole Group's efforts to become a leading player and solutions provider for the ageing population in France 141 I Investor Day 20 March 2014
CAA Group's 2016 ambitions 1 Savings/Retirement: Support growth momentum in life insurance by leveraging on development opportunities (new products, high net worth individuals) Promote a simple, structured offer that meets the needs of our customers Structure a product offer around an effective, secure fund and a range of unit-linked contracts (formula-based funds, unit-linked funds, etc.) Capitalise on the introduction of the new Euro-growth contracts in France, which enable more flexible financial management Innovate in our approach to the high net worth segment Develop a comprehensive approach to managing the wealth of high net worth individuals Accelerate the roll-out of recent innovations, namely discretionary management and advisory management mandates Continue our development in alternative channels, which represent 10% of the life insurance market Gain market share in the Independent Wealth Management Advisor market by providing innovative, diversified offers (SCPI, Euro dynamique, etc.) Develop partnerships with specialist players in online financial savings, either internal (BforBank) or external Support growth in our assets under management Assets under management ( bn) +10% 260 235 2013 2016 142 I Investor Day 20 March 2014
CAA Group's 2016 ambitions 2 Death & disability / Health / Creditor: Develop our positions by enhancing our product offers and commercial approach and by strengthening our position in the group insurance market Strengthen our positions in creditor insurance In France, to meet the challenges created by regulatory change, pro-actively protect our partners' positions through three pillars: Offer: improve the group contract offer distributed by LCL and continue to roll out our offer to the Regional Banks Distribution: support the customer advisors through sales-aid tools and dedicated training Administration: improve the quality and speed of claims administration to make it a differentiating factor for our customers Innovate to meet the changing needs of our customers in individual death & disability Enhance the range of individual death & disability products to meet the challenges of an ageing population Develop a tailored advisory approach enabling our partner networks to gain an understanding of customer needs Develop a comprehensive group insurance offer in France Seize the opportunity to penetrate the group health and death & disability insurance market opened up by the national industry agreement signed on 11 January 2013 To do this, capitalise on our position and our strengths: The Regional Banks' and LCL's high penetration rates of the corporate market in France Technical know-how in individual insurance Know-how in distributing group retirement and employee savings plans Trends in Health and Death & disability premium income ( bn) 3.5 1.7 +14% 3.8 1.9 +9% 1.8 1.9 Individual Health, Death & Disability Creditor 2013 2016 143 I Investor Day 20 March 2014
CAA Group's 2016 ambitions 3 Property & Casualty Insurance: increase the number of products owned per branch network customer in the individual, farming and small business markets Raise the internal ownership rate of Regional Bank individual customers to 40% 1 (vs. 31% in 2013) Increase the number of products owned by our customers by focusing on an advisory approach and selling contracts related to consumer finance and/or home loans Adapt our offer and our commercial approach to capitalise rapidly on the new Hamon Law In the farming/small business segments, support our position by innovating and adapting our offers Continue innovating to meet the specific needs of the agricultural world: insuring farm operations (harvest, fodder crop insurance, etc.) and developing in the area of prevention Develop our comprehensive approach to professionals and very small businesses: insurance for the business owner, the business and its employees Continue to outperform the market Property & casualty premium income in France ( bn) 2.2 +29% 2.8 2013 2016 1. Motor, household, health or life s accident 144 I Investor Day 20 March 2014
CAA Group's 2016 ambitions 4 International: Continue our development, mainly in Europe International business has grown rapidly in the past few years and represented 17% of CAA's premium income at end-2013 FOCUS 1: Pursue organic growth in the markets where Crédit Agricole Group operates Italy: Ambitious growth targets Targets: +11% for life premiums, twofold rise for Property & Casualty premiums 3 growth drivers: Increase the internal ownership rate Launch new products (death & disability and P&C) Broaden distribution channels FOCUS 2: Accelerate international development of the partnership model Develop our position in new countries where Crédit Agricole Group operates Increase distribution agreements with non-group partners Poland: Build a complete platform in Life and Property & Casualty Shift the offer towards covering long-term savings needs Set up a P&C subsidiary 145 I Investor Day 20 March 2014
Insurance business: recurring, relatively non-volatile financial and commercial performance CAA continues to grow and improve its profitability while controlling its capital consumption Premium income ( bn) 31 Maintain first-class operational efficiency through cost savings and operational synergies 2013 2016 26.4 +17% Cost/income ratio Combined ratio 1 26.4% <30% 95.8% c.95% Net income Group share ( bn) c.1.2 1 1. Based on Pacifica scope 2. Based on what we know today 2013 2016 >15% 2013 2016 to finance investment in information systems and development projects, particularly in multi-channel Future prudential environment: Solvency 2 will not lead to additional capital needs for Crédit Agricole Assurances: the current capital level is sufficient to meet the new Solvency 2 requirements 2 Crédit Agricole Assurances will be ready on 1 January 2016 when the Directive comes into effect, and is already adapting its financial management with the aim of controlling its capital consumption by optimising the risk/reward profile (innovative financing, strategic equity investments ) 146 I Investor Day 20 March 2014
147 I Investor Day 20 March 2014 Business lines 2016 ambitions Savings Management and Insurance Amundi
Amundi, European asset management leader European leader, in the global top 10 777bn in assets under management (AuM) No. 1 in Europe and no. 9 worldwide in terms of AuM* 2,869 Global rankings of asset managers by assets under management* (at end-2012) Two main businesses Provider of savings solutions for 100 million retail customers of partner networks and 1,000 third party distributors Provider of investment solutions for 1,000 institutional and corporate clients A successful model combining, for each customer segment, an industrial approach and a proven product innovation capability A comprehensive and recognised product offer No. 1 in Europe in money market funds and guaranteed capital products 3 Established expertise in active management: fixed income (euro, US, global), equities (Europe, Japan, emerging markets), absolute return A fast growing passive management platform (N 5 sur les ETF en Europe) 4 One of the most profitable groups in the industry Cost/income ratio 54.6% 1,620 1,585 1,279 1,231 1,066 1,051 802 727 607 592 591 576 575 563 554 European asset managers 521 503 500 500 * Total assets under management in bn - Source IPE "Top 400 global asset managers active in the European marketplace" published in June 2013, data as at December 2012, interviews with asset management companies about their assets under management at end-december 2012 (open-ended funds, dedicated funds, discretionary mandates) 1. PIMCO AuM are no longer consolidated with AGI AuM 2. Excluding Alliance Bernstein AuM 3. Lipper FMI December 2013, scope: open-ended funds domiciled in Europe 4. Deutsche Bank ETF annual report and outlook 16 January 2014, data at 31/12/2013 148 I Investor Day 20 March 2014
A balanced client and asset base A large client base A full range of products A strong international presence Breakdown of AuM by client segment (%) 777bn at 31 December 2013 Breakdown of AuM by asset class (%) 777bn at 31 December 2013 Breakdown of AuM by geographical area excluding France (%) 141bn at 31 December 2013 Institutionals and corporates 264bn (34%) Partner networks and 3rd-party distributors 173bn (22%) Specialised 31bn (4%) Guaranteed Structured 27bn (4%) Equities 102bn (13%) Rest of the world 18bn (13%) Europe 64bn (45%) Balanced 71bn (9%) Asia ex- Japan 37bn (26%) Group insurance companies 341bn (44%) Fixed income 402bn (52%) Money market 144bn (18%) Japan 23bn (16%) * Including employee savings schemes 149 I Investor Day 20 March 2014
An innovative, value creating operational model Customer-focused organisational structure, built around Amundi's two core businesses Strong synergies between these 2 businesses: First, products dedicated to the networks benefit from the performance drivers developed for institutional clients Second, assets managed for network customers enable optimum use of resources devoted to the investment management platform Third, the two businesses share integrated IT system, back office and risk management functions Clients Partner networks and savings solutions International networks* Institutional clients and third-party distributors Institutionals and pension funds, corporates, insurance companies, sovereign funds and central Banks, thirdparty distributors, employee savings schemes Dedicated structures CA platform LCL Gestion S2G Etoile Gestion International platforms Marketing, promotional activities and discretionary management Sales & marketing (c.30 countries, c.330 sales & marketing staff) Core management and specialised products Production platform / structuring Volumes Performance 6 hubs: Paris, London, Singapore, Hong Kong, Tokyo, Durham (USA) Expertise across all asset classes: Euro & USD fixed-income, credit, global fixed-income, equities, absolute return, allocation solutions, passive management Risk management and operations Integrated IT platform, back office and risk management functions organized as a business line * Europe : Cariparma (Italy), Crelan (Belgium), KB (Czech Republic), CA Polska (Poland) ; Asia : Resona (Japan), ABC (China), SBI (India), NH (South Korea) 150 I Investor Day 20 March 2014
One of the most profitable groups in the industry 2013 cost/income ratio for the main global asset managers* T Rowe Price (1) Amundi Blackrock (2) Invesco (2) Franklin Templeton (1) (3) Schroders (4) 53% 55% 59% 60% 63% 67% Natixis Inv. Solutions (4) AllianceBernstein (2) Legg Mason (2) (5) 74% 76% 78% * Sample of asset managers for which information is available 3. Period from 1/10/2012 to 30/9/2013 (accounting year October to September) 1. Presentation of US GAAP results (adjusted results not available) 4. At end-september 2013 (9 months) 2. Adjusted results 5. Period from 1/4/2013 to 31/12/2013 (9 months accounting year April to March) 151 I Investor Day 20 March 2014
Target: 1,000bn in AuM in 2016 1 2 3 DEVELOPMENT STRATEGY Step up our business development Consolidate our leadership in France Accelerate our international development of our priority customer targets: Partner networks Third-party distributors Institutionals and corporates Continue investing to support organic growth (talent, brand, etc.), financed by productivity gains Play a key role in the consolidation of the asset management sector and pursue a value-creating external growth policy Acquisition of mid-sized players to open up the platform to one or more new distribution networks Targeted acquisitions to accelerate the development of high priority businesses or geographic areas 2014-2016 targets Target of 1,000bn in AuM by end-2016, through: c.1/3 organic growth, mostly on long-term asset classes and international clients c.2/3 external growth or strategic partnerships Cost-income ratio maintained at a best-in class level of below 60% Steady growth of results that can be boosted by potential acquisitions 152 I Investor Day 20 March 2014
1 Consolidate our leading position in France Market shares of the major banking groups in French mutual funds* in % 25.7 25.4 13.2 10.0 8.2 7.9 6.0 3.3 2007 2008 2009 2010 2011 2012 2013 AMUNDI GROUPE CREDIT MUTUEL LA BANQUE POSTALE BPCE GROUPE BNP PARIBAS 26.9 9.2 3.7 Amundi has strengthened its leadership among the major banking groups in a shrinking French market Over the period 2014-2016, our goal is to consolidate this leadership by capturing a share of the off-balance sheet savings inflows of our partner networks This ambition is supported by: Dedicated structures to support our partner networks Continuous adjustment of our product ranges (e.g., guaranteed products, diversification solutions for individuals and corporates, etc.) Development of the high net worth segment through specific initiatives (e.g., Amundi Patrimoine, discretionary and advisory mandates, real estate products, etc.) Renewal of distribution and promotion methods (e.g. greater presence of fund managers in the networks, remote client support) *Source: Europerformance NMO December 2013 Mutual funds domiciled in France, excluding discretionary and dedicated 153 I Investor Day 20 March 2014
1 Accelerate our international development Amundi s international presence Net inflows excluding French networks forecasted at 75bn over the period 2014-2016 driven by our priority geographies: Europe, Asia and the Middle East Specific action plans by customer segment: International networks: continue to develop the existing partnerships and JVs and create new partnerships through distribution or equity-based agreements (e.g. creation of Amundi Poland) Third-party distributors: strengthen links with global distributors Institutionals and corporates: broaden our range of dedicated solutions by client type (e.g. employee savings offer for European companies, tailored services for insurers and pension funds, etc.) 154 I Investor Day 20 March 2014
2 Continue to support development through investments financed by productivity gains Amundi's operating costs in 2013 were the same as CAAM's in 2007 ( m - inflation adjusted figures) 798 103 695 926 85 237 584 785 785 Continue to invest in order to strengthen commercial and management capability: Open new offices (e.g. Netherlands, Sweden, Poland, Thailand, etc.) Develop our offer in the most popular asset classes: passive management (ETFs and index trackers), global equities and fixed income (including global high yield), absolute return, etc. Hire new talent (+200 FTEs between 2013 and 2016), mostly abroad Strengthen brand awareness (new corporate identity, targeted product campaigns, etc.) Finance these investments through ongoing productivity gains, particularly in support costs in France (IT, shared support functions, optimising external expenses, etc.) 2007 CAAM 2009 CAAM + SGAM + BFT 2013 Amundi Maintain a best-in class cost/income ratio of less than 60% CAAM SGAM BFT Amundi Inflation effect 155 I Investor Day 20 March 2014
3 Pursue value-creating acquisitions The business dynamics of the European asset management sector should favour a consolidation trend (growing competitive pressure, inflows concentrated on an increasingly limited number of asset managers, etc.) Amundi is well positioned to play a consolidation role, thanks to: Its operational model Its know-how in integrating businesses Its business performance Amundi will therefore explore all consolidation opportunities that could: Give it access to one or more new distribution networks outside France Deliver significant potential for cost synergies Offer complementary expertise and customer base In addition, focused acquisitions could be targeted to support our development on direct clients segments: Either to strengthen our product offer (e.g. acquisition of Smith Breeden, minority stake in TOBAM) Or to increase our commercial presence in priority geographic areas 156 I Investor Day 20 March 2014
157 I Investor Day 20 March 2014 Business lines 2016 ambitions Savings Management and Insurance CACEIS
Strengthen its leadership in asset servicing in Europe Positioning / Strengths Key strategic areas of focus 2016 Targets European leader in asset servicing No. 1 depositary bank in Europe No. 1 fund administrator in Europe No. 3 custodian in Europe Assets under custody: 2,254bn Assets under administration: 1,309bn A business dedicated to banks, institutional investors and asset managers Operational excellence, with a cost/income ratio at the best level of the industry Very good positioning in terms of price competitiveness High and recurring results despite a challenging environment In an environment of low interest rates and strong competitive pressure: Broaden the product offer to cover the entire value chain Develop clearing of listed derivatives and offer CIB back-office outsourcing solutions Extend the performance reporting, analysis and metrics offer for customers Strengthen the service offer for private equity, real estate and alternative investment funds Strengthen our presence in Europe to serve global customers Set up depositary banks in Belgium, Netherlands, Italy, Switzerland and United Kingdom Develop fund administration in Germany Improve operational efficiency by sharing operational production centres, particularly for the custody business, while continuing to invest in information systems to serve our customers Maintain a high profitability: RoE c. 15% 158 I Investor Day 20 March 2014
159 I Investor Day 20 March 2014 Business lines 2016 ambitions Savings Management and Insurance Crédit Agricole Private Banking
Support our position as one of the European leaders in private banking Positioning / Strengths Key strategic areas of focus 2016 Targets One of the European leaders with 93bn in AuM 1 Business that provides liquidity for the Group with limited capital consumption Solid business franchise in France: among the leaders with Indosuez Private Banking ( 23bn in AuM) in synergy with the Regional Banks Historically strong presence in Monaco, Luxembourg and Switzerland serving an international clientele In France, step up cross synergies with the Regional Banks in wealth management In Europe, accelerate organic growth in the domestic customer segment: Italy: set up a wealth management business Belgium/Spain: strengthen the sales and marketing teams Outside Europe, strengthen the sales and marketing teams in high-growth areas, particularly in Asia and Latin America Participate in sector consolidation with a selective approach AuM: 108bn 2 Revenues CAGR +2.5% Cost/income: - 2 pts in 2016 vs. 2013 Cost control plan to save c. 40m, which will be reinvested in organic growth Effective IT platform, commercialised outside the Group 1. Crédit Agricole Private Banking AuM; LCL has a further 39bn 2. AuM excluding LCL 160 I Investor Day 20 March 2014
161 I Investor Day 20 March 2014 Business lines 2016 ambitions Specialised Services
162 I Investor Day 20 March 2014 Business lines 2016 ambitions Specialised Services CACF
Strategy refocused on self-funded activities creating value for the retail banks and on profitable markets and partnerships The adjustment plan initiated in 2011 has been successfully completed Consolidated loan book down 8.9bn between June 2011 and Dec. 2013 International portfolio refocused (disposals or run-off in Greece, Hungary, Czech Republic, Slovakia, Saudi Arabia, Nordic countries) Sales of loans (non-performing and performing) totalling c. 4bn Cost control supporting the adjustment plan: Operating costs down c.9% between 2010 and 2013 Cost/income ratio : 47% 1 at end 2013 Increase in self-funding from 42% at end 2011 to 53% 1 at end 2013 Signing of long-term agreements by FGAC and Agos in 2013 78.4 78.3 20.2 20.7 13.3 13.4 Managed loan book ( bn) 73.2 70.0 19.5 13.0 21.6 12.4 44.9 44.2 40.7 36.0 Partnerships and 1 JVs Retail banks A solid position on which to build growth A leader in consumer finance in Europe, no. 2 in France Large share of car financing in our loans portfolio, the safest segment of the market Risks under strict control in France and improving situation in Italy A business that significantly contributes to the Group's other business lines: retail banking, insurance Geographical breakdown of managed loan book (Dec. 13) Europe 24% Rest of w orld 5% France 38% Jun-11 Dec.-11 Dec.-12 Dec.-13 1. Pro forma for equity accounting of entities proportionately consolidated in 2013 Consolidated loan 1 book Italy 33% 163 I Investor Day 20 March 2014
Reinforce links with the Group, focus business, improve profitability by leveraging major partnerships Strengthen links with the Group's retail banks Contribute to the relaunch of the consumer finance business in the Group's banks in France and Italy Develop sales of insurance products (creditor, property & casualty insurance, etc.) Contribute to the Group's innovation by rolling out our expertise in big data, prevention of overindebtedness and digital development Boost own account business Leverage agreements with major partners In France, restore CACF's historical market share (17%) Boost new business with our partners in the automotive sector and in Germany Agos: return to profitability from 2014, stabilise loan book over the plan period FGAC: develop self-funding and consolidate profitability Reduce Group funding by 5.5bn in 2016 for Agos and FGAC Refocus our international operations Refocus our international operations on self-funded, highly profitable entities Build on digital and customer relationship Optimise liquidity management and improve profitability Implement end-to-end paperless processes Set up digital signature on the web and in sales outlets (develop tablet solutions for all our partners) Achieve a Top 2 Customer Recommendation Index (CRI) in France and consolidate Agos N 1 position Strengthen self-funding: target 70% in 2016 driven mainly by a broader deposit offer in Europe and a proactive securitisation programme Maintain risk control and continue to cut costs Secure the increase in margins on new business 164 I Investor Day 20 March 2014
Summary Strengthen links with the Group's retail banks Boost own account business Leverage agreements with major partners Refocus our international operations Build on digital and customer relationship Optimise liquidity management and improve profitability 2016 Targets Self-funding increased to over 70% (2013: 53% 1 ) Consolidated loan book stabilised at 37bn at end 2016 Develop the managed loan book on behalf of the Group's banks (Regional Banks, LCL, Cariparma): +9% per annum, to 16bn Revenues: c. +1% p.a. Costs: c. -2% p.a. Cost/income ratio: <42% Cost of risk on loans reduced to c.250 bp (vs. 356 bp in 2013 1 ) 70.0 21.6 42% Managed loan book ( bn and 2013-2016 CAGR) +4% +4% 48% 24.6 12.4 +9% 16.2 +1% 78.0 36.0 37.1 Dec. 13 Dec. 16 53% Partnerships 1 and JVs Retail banks Consolidated loan book 1 CACF Self-funding ratio 70% 2011 2012 2013 2016 1 1. Pro forma for equity accounting of entities under proportionate method in 2013 165 I Investor Day 20 March 2014
166 I Investor Day 20 March 2014 Business lines 2016 ambitions Specialised Services CAL&F
Further integrate with the retail banks and increase value creation for the Group and its customers by leveraging our positions as leader in France and a major player in Europe Positioning / Strengths Key strategic areas of focuses 2016 Targets Leader in factoring and no. 4 in leasing in France Strategic orientation focusing on developing business with customers of all Group entities Operations in 11 countries Modern, flexible, secure solutions that meet the financing needs of the real economy Recognised expertise in the Group's areas of excellence A restructured business with a cost/income ratio improved by 4 percentage points between 2011 and 2013 167 I Investor Day 20 March 2014 Keep on integrating the leasing and factoring businesses with the Group's retail banks Improve leasing's distribution and funding model Integrate the businesses in the Group's IT system Strengthen participation in areas of excellence (including renewable energy) Share of leasing in MT corporate financing Share of factoring in ST corporate financing Market 5% 9% 12% Crédit Agricole Group Enhance international intra-group synergies Develop CAL&F's international business for the benefit of the Group's retail banks Strengthen cooperation and pool resources: shared factoring platform in Benelux and Germany, shared factoring IT system Develop factoring in Poland and launch in Morocco Develop servicing offers that do not consume liquidity Market an outsourcing service via the factoring platform for customers outside the Group (white label, contract management) Capitalise on expertise in the servicing of securitised commercial receivables Strengthen relationship excellence with customers and partners and extend customer satisfaction and recommendation metrics 15% 50% increase in the share of leasing and factoring in the financing of retail bank corporate customers Synergies with international retail banks: revenues + 20m Cost/income ratio: -4 pts to 53% 80% of our customers recommend us
168 I Investor Day 20 March 2014 Business lines 2016 ambitions Specialised Services Payments
Consolidate the Group's European leadership in payments in an environment of regulatory, competitive and technological change Positioning / Strengths Key strategic areas of focus 2016 Targets Leader in payments in France with 8.6 billion transactions per annum A unique payments platform in the European market (crossborder, multi- currency, multi-bank, multilingual) A competitive offer able to attract major accounts Strong innovation capacity in new payment means c. 10% of Group's retail banks revenues attributable to payments Offer our customers innovative payment services and means Individuals: contactless, digital wallet, card apps for smartphones. Originators and retailers: cross-channel payment acceptance, offer for large remitters, new digital payment terminals, generation of retail traffic Corporates: SEPAmail electronic invoice payment service, multibanking/multi-service acquisition, international support, B2B SEPA direct debits Improve our operational efficiency by: Pooling payment volumes of the entire Group (in particular, extending to Italy and Poland) Developing outsourcing services for third party customers Impact from MT Plan initiatives: + 130m revenues from payments in the Group's retail banks vs. 2013 30% decrease in the unit processing cost 169 I Investor Day 20 March 2014
170 I Investor Day 20 March 2014 Business lines 2016 ambitions Corporate and Investment Banking
CACIB: a medium-sized CIB with strong franchises Focused geographical and commercial positioning A CIB with an international network covering 32 countries Strong franchises Syndicated loans and Structured Finance (at 31/12/13) 2 No. 1 bookrunner in aircraft financing worldwide No. 4 bookrunner in all syndicated loans EMEA No. 8 bookrunner in syndicated loans in G3 currencies Asia incl. Japan No. 4 in advisory and No. 7 mandated arranger in project financing worldwide Bonds and securitisation (at 31/12/13) 2 No. 1 sponsor ABCP securitisation conduits Europe No. 7 bookrunner bonds in Euros No. 2 bookrunner bonds in Euros for financial institutions No. 7 in project bonds worldwide Focused on a core client base of corporates and financial institutions, representing about 75% of total business revenues 1 in 2013 1. Excluding Group 2. Source: Thomson Financial, CPWare, Air Finance Database, Project Finance International 171 I Investor Day 20 March 2014
CACIB's strategy: a European Distribute-to-Originate Debt House serving borrowers and investors, as well as Crédit Agricole Group 1 2 A CIB anchored to Europe Focused on debt 75% of business activity is related to Europe 1, 25% outside Europe in Asia and the Americas with non-european clients Activity focused on debt with a balanced business mix between financing activities and fixedincome (about 55/45 2 ) A Distribute-to-Originate model serving borrowers and investors thus optimising the use of scarce resources 3 Specialised by sector Full sector-based organisation to serve corporates and financial institutions 4 5 Aligned with the Group With a limited risk profile A platform enabling the Group to access international investors and to support medium-sized corporate customers of retail banking networks in their international development Business focused on financing the real economy, thus no need to create a subsidiary under French banking law Strong presence in the Group's areas of excellence 3 and in sustainable banking: CACIB is the world leader in green bonds Low VaR compared with the other players in the CIB industry RoTE > CoE in the medium term Target RoTE of 12% 4, higher than the cost of equity 1. Business with European and non-european clients in Europe and with European clients outside Europe ; 2. 2013, excluding discontinuing activities, restated for loan hedges and CVA/DVA impacts; 3.Agriculture and food processing, Housing, Health & Ageing, Energy Efficiency and the Environment; 4. Basel 3 RoTE, cost of risk assumption: c. 30 bp of outstandings, including discontinuing activities, equity allocation 9% of risk-weighted assets and including main deductions from the CET1 numerator 172 I Investor Day 20 March 2014
A CIB arm revamped to leverage the full potential of its client and product franchises CACIB has been significantly downsized in response to the crises that have impacted the sector and, in a tightening regulatory environment, continues its transformation in order to restore growth Adjustment (sovereign crisis and regulatory impacts) Transformation/return to growth (new regulatory framework) 2011 2012 2013 2014 2015 2016 Reduction in consumption of scarce resources Reduction of liquidity consumption - 35bn from June 2011 to end-2013 Reduction of RWAs - 66bn, pro forma CRD3&4, from June 2011 to end-2013 Reduction of balance sheet size 1-342bn (-33%) from end-2012 to end-2013 Refocused business scope Exit from non-core businesses and those of non-critical size Discontinuation of equity derivatives 2 Sale of brokers Sale of portfolios or market risks on credit derivative portfolios Discontinuation of market activities in commodities 3 Productivity gains and RWAs managed Target cost/income ratio of 53% RWAs of about 110bn in 2016 Level reached thanks to the amortisation of discontinuing activities and actions to mitigate the CRD4 impact Moderate increase in RWAs in growth-driving activities Total balance sheet remaining below 700bn 1 Revenue growth 3% revenue growth per annum 4 from 2013 to 2016, fully leveraging the Distribute-to-Originate model as well as the product and client franchises Financing activities: +2% per annum 4 from 2013 to 2016 Capital Markets and Investment Banking: +7% per annum 4 from 2013 to 2016 1. CIB's contribution to CA S.A.'s balance sheet ; 2. Excluding Corporate Equity Derivatives; 3. Excluding precious metals; 4. Pro forma for equity-accounting of UBAF under proportionate method in 2013, restated for loan hedges and CVA/DVA impacts 173 I Investor Day 20 March 2014
Distribute-to-Originate model: the core feature of our CIB 2013-2016: an organisation focused on debt activities serving corporates (about 70% of business revenues) and financial institutions (about 30% of business revenues) Borrowers Investors Financing activities origination Financing activities solutions Large corporates Intermediatesized entreprises 174 I Investor Day 20 March 2014 Structured Finance Commercial banking Capital markets activities Interest Rates Derivatives FX Investment banking Syndication Securitisation Debt capital markets Trading and market/making capabilities Secondary debt markets Treasury N.B. For financial communication purposes, financing activities cover Structured Finance, commercial banking and syndication. Capital Markets and Investment Banking covers fixed-income (Debt capital markets and secondary debt markets, securitisation, treasury, interest rates derivatives and FX) and investment banking activities Banks Institutional investors (insurers, asset managers, etc.) Debt funds Financial companies Sovereigns, government agencies and supranationals
2016 Targets 3 drivers to achieve a RoTE of 12% 1 by 2016 1 Increase revenues while maintaining a low risk level A regional strategy to meet the bank's origination and distribution challenges Strengthen sector-based coverage to help meet ambitious medium term growth targets Financing activities: strengthen our origination and distribution capability as well as our leadership positioning in Structured Finance Capital Markets and Investment Banking (CMIB): boost activity by leveraging the full potential of our product and client franchises Strengthen synergies with Crédit Agricole Group 2 Improve operational efficiency and aim for excellence Develop industrial partnerships Simplify processes and optimise sourcing Transform CACIB into an industrial platform for Crédit Agricole Group for Capital market activities Develop a loan servicing offer for external clients Optimise risk weighted assets in a challenging regulatory environment Continue efforts to rationalise the balance sheet structure Maintain stable liquidity consumption from end-2013 to end-2016 3 Actively manage scarce resources 2016 targets Total revenues 2 : +3% p.a., o/w +2% p.a. in financing activities and +7% p.a. in CMIB VaR limit maintained at 30m Cost/income ratio: 53% Risk weighted assets: c. 110bn Total balance sheet: < 700bn 3 1, Basel 3 RoTE, cost of risk assumption: c. 30 bp of outstandings, including discontinuing activities, equity allocation 9% of risk weighted assets and including main deductions from the CET1 numerator ; 2. Pro forma for equity-accounting of UBAF under proportionate method in 2013, restated for loan hedges and CVA/DVA impacts; 3. CIB's contribution to CA S.A.'s balance sheet 175 I Investor Day 20 March 2014
1 Increase revenues while maintaining a low risk level Revenues: +3% p.a. from 2013 to 2016 1 Capital Markets and Investment Banking Structured Finance Commercial Banking Discontinuing activities 3,824 1 1,640 +3% p.a. 1 CAPITAL MARKETS AND INVESTMENT c.4,200 1 BANKING ~ 2,000 Revenues: +7% p.a. from 2013 to 2016 Growth representing a worldwide market share gain in Fixed-Income of approx. 0.2 percentage point 2 FINANCING ACTIVITIES Revenues: +2% p.a. from 2013 to 2016 1,173 ~ 1,300 879 ~ 900 DISCONTINUING ACTIVITIES Revenues not material in the medium term (natural amortisation and disposals) 132 2013 revenues 2016 revenues 1. Including brokerage revenues (CLSA NY and Tokyo) reclassified under IFRS 5 in Q3-13 ( 42m in H1-13), pro forma for equity-accounting of UBAF under proportionate method in 2013, restated for loan hedges and CVA/DVA impacts Pro forma Telecom Finance booked in Structured Finance (in Commercial Banking in 2013) 2. From c.1.3% to c.1.5%, assuming stable global fixed-income revenue pool from 2012 to 2016 176 I Investor Day 20 March 2014
1 Develop a regional strategy to meet the bank's origination and distribution challenges A medium term geographical strategy tailored to the needs of our priority clients An activity anchored to Europe Asia and Americas key regions for tapping into large pools of investors and supporting our clients in their international expansion Region Americas EMEA 1 Asia Strategic medium term drivers Continue focused expansion, mainly through the $ credit platform and in our Structured Finance franchises Support European clients in their US expansion Strengthen our presence with US financial institutions and large corporates Continue to support major French and European companies, our core client franchise Serve non-european large corporates and institutional investors with significant European presence or with strategies of expansion in Europe Support our clients, particularly European ones, in a region with higher growth prospects than the western economies Develop relationships with local investors that have surplus liquidity, in order to serve the Distribute-to-Originate model % of medium term revenues 2 15-20% 65-70% c. 15% 1. EMEA: Europe, Middle-East and Africa; 2. Excluding Group, revenues generated in each region regardless of client's geographical origin 177 I Investor Day 20 March 2014
1 Strengthen sector-based coverage to help meet ambitious medium term growth targets 3 strategic drivers in CACIB's new sector-based coverage organisation Give the Structured Finance sectors, which cover our main franchises, a stronger coverage role Organise corporate coverage by sector to develop comprehensive relationships with our key clients and position CACIB as their reference bank Strengthen our presence in the financial institutions segment, a core pillar for the development of our Distribute-to- Originate debt house model 8 sectors for Structured Finance clients 6 sectors for other targeted corporate clients 3 sectors for financial institutions Oil & Gas Shipping TMT 1 Automotive Mining & Metals Banks Europe Infrastructure Utilities & Power Aviation & Rail Capital Goods Consumer Goods & Retail Sovereigns Real Estate Commodities Luxury Agrifood Insurers Europe 8 sectors representing over 40% of business revenues 2 6 sectors representing about 20% of business revenues 2 3 sectors representing over 20% of business revenues 2 1. Telecoms, Media and Technology ; 2. 2013 excluding Crédit Agricole Group 178 I Investor Day 20 March 2014
1 Financing activities: strengthen our origination and distribution capability and our position as a leader in Structured Finance CIB medium term revenues Financing activities Build on our franchises and major origination capability Assert our leadership in Structured Finance, a major driver of CACIB's profitability Continue developing our distribution capability thanks to an already robust set up Strengthen the support of our clients in their development by being more proactive e.g. syndicated loans, bridge loans to acquisition Promote the entire product range to borrowers in line with investor appetite e.g. securitisation, co-investments, bonds, etc. Develop the Rating Advisory business and promote bond refinancing Strengthen our franchises in Structured Finance thanks to a global position enabling us to support our clients in their international investments Maintain significant diversification of revenues and risks thanks to a broad range of sectors covered Continue implementing a less capital intensive model, more focused on fees and advisory Develop investor interest in new asset classes e.g. project bonds Increase interest of new investor types in the various asset classes e.g. Institutional investors, debt funds 2016 TARGETS Revenues +2% per annum 1, on stable liquidity consumption o/w Structured Finance revenues +3% per annum o/w Commercial Banking revenues +1% per annum 1 Cost/income: 40% RWAs: 65% of CIB's RWAs 1. Pro forma for equity-accounting of UBAF under proportionate method in 2013, restated for loan hedges Pro forma for Telecom Finance booked in Structured Finance (in Commercial Banking in 2013) 179 I Investor Day 20 March 2014
1 Capital markets and investment banking: boost activity by leveraging the full potential of our product and client franchises (1/2) CIB medium term revenues CMIB Capitalise on CACIB's franchise as a debt house Step up interactions with internal financing businesses by supporting them throughout the life of the assets Maximise our footprint with Financing activities clients Strengthen our distribution capability in and $ Improve our distribution capability and develop our electronic capability to boost volume growth in hedging operations (interest rate and FX) handled for our clients Capitalise on market share gains on our clients' overall flows to help us win DCM mandates Strengthen our capability in $ credit to offer all our clients access to the US market Leverage the full potential of our product and client franchises Develop the product offering Develop project bonds and ABS securitisation Aim for moderate growth in ABCP conduits Confirm our leadership in green bonds Continue a controlled roll-out of our structured investment product range, capitalising on market growth and our expertise in risk engineering and management Continue to support our major clients in their strategic corporate finance deals to maintain high-level contact Provide M&A and Equity Capital Market services to our major clients thanks to a strengthened sector-based coverage and building on our partnership with Kepler/Cheuvreux Develop equity financing by capitalising on our franchise in leveraged employee savings plans and by focusing on Europe and the United States 180 I Investor Day 20 March 2014
1 Capital markets and investment banking: boost activity by leveraging the full potential of our product and client franchises (2/2) CIB medium term revenues CMIB Reallocate front office resources and generate productivity gains Make use of front office capability freed up by completion of the adjustment plan and management of discontinuing activities Strengthen sales force productivity Integrate coverage of financial institutions at the heart of capital markets activities 2016 targets Invest in market IT systems Continue investing in market IT systems (electronic platforms, trading systems) to cope with growth in volumes Revenues: +7% per annum 2 Cost/income: 64% Control resources Control costs mainly through redeployment of sales forces and support teams Contain RWAs growth by developing low capital consumption 1 activities and by optimisation actions (e.g. active CVA management) RWAs: 31% of CIB's RWAs RoTE > CoE 1.Bonds, structured fixed income, vanilla derivatives that benefit from clearing and compression mechanisms; 2. Including brokerage revenues (CLSA NY and Tokyo) reclassified under IFRS 5 in Q3-13 ( 42m in H1-13) and restated for CVA/DVA impacts 181 I Investor Day 20 March 2014
1 Strengthen synergies with the Group Provide better access to liquidity Improve the Group's access to major international investors Structure innovative solutions to raise liquidity for the Group e.g. covered bonds with export credit agency guaranteed loans as collateral: 1bn raised in 2013 Play our part in amplifying Group dynamics Continue to support Group entities by providing market expertise or support (risk, operations, legal and particularly support in complying with the new regulatory requirements for market activities, e.g. EMIR) Improve the investment solutions designed for Crédit Agricole Assurances and Amundi, enabling them to diversify their portfolio mix with high quality assets Provide technical expertise to the Group's specialised businesses to help restructure their liabilities e.g. securitisation for CA Consumer Finance Support the Group's customers Support the Group's networks in their expansion targets in the Intermediate-sized enterprises segment in France and Italy Support these customers In their international development By facilitating their access to liquidity through disintermediated financing solutions And providing them with the benefit of our sector expertise Develop CACIB's role as Crédit Agricole Group's industrial platform in capital markets activities 182 I Investor Day 20 March 2014
2 Improve operational efficiency and aim for excellence A Improve operational efficiency Businesses and other Functions Adjust and optimise the organisation to the new Debt House model Share support function resources within Crédit Agricole Group c.- 100m from 2012 to 2016 1 o/w c.- 80m already achieved B IT & Operations Optimise sourcing (offshoring/outsourcing) Centralise operations on existing platforms in Paris and Hong Kong Develop our operations processing entity in India Develop industrial partnerships Optimise IT expenses Make productivity gains and simplify processes (lean management) c.- 130m from 2012 to 2016 1 o/w c.- 40m already achieved 2016 targets Cost/income ratio comparable with best peers: 53% C Business/country refocusing Exit from discontinuing activities (equity derivatives) completed Exit from last non-core countries c.- 110m from 2012 to 2016 1 o/w c.- 75m already achieved Support Functions: aim for excellence in customer service Internal CIB clients Adapt support function organisation to the Debt House model 1. Excluding mainly variable compensation, FX effect, inflation Internal Group clients Transform CACIB into an industrial platform for Crédit Agricole Group regarding Capital market activities External clients Propose a loan servicing offer to investors and banks 183 I Investor Day 20 March 2014
3 Actively manage scarce resources In response to new regulatory requirements under CRD3&4, CACIB has implemented the 2011 adjustment plan and accelerated the implementation of the Distribute-to-Originate model Risk weighted assets 1 Target c. 110bn Basel 3 impact on capital markets activities limited by mitigation actions (CVA desk, optimisation, etc.) Sharp reduction in risk weighted assets of discontinuing activities Moderate growth in risk weighted assets of ongoing activities from 2013 117 8 130 105 25 8 8 CRD 4 2 c.110 ~5 Total balance sheet 1 Target < 700bn At 31/12/13, total assets of 681bn c. -33% 1,023 797 681 109 97 97 ~105 30/06/2011 31/12/2013 01/01/2014 31/12/2016 Ongoing activities Discontinuing activities 2012 reported 2012 adjusted for derivatives offsetting 2013 CIB's contribution to Crédit Agricole S.A.'s balance sheet ( bn) Liquidity: stable consumption from end-2013 to 2016 Liquidity effort largely achieved from mid-2011 to end-2013 (- 35bn at current exchange rates) Stable consumption by 2016 at constant exchange rates 1. CIB s contribution to Crédit Agricole S.A. ; 2. Excluding CRD4 exemption 184 I Investor Day 20 March 2014
Medium term targets Key strategic areas of focus 2016 Targets CACIB: a European Distribute-to-Originate Debt House serving borrowers and investors, as well as Crédit Agricole Group Revenues: +3% p.a. 1 Cost/income: 53% VaR limit maintained at 30m RoTE 12% 2, covering the cost of equity Financing activities 3 Build on our strong origination capability and our leading position in Structured Finance to develop the model Revenues: +2% per annum 3 Cost/income: 40% 65% of RWAs 4 Capital Markets and Investment Banking 5 Leverage the full potential of our product and client franchises to extend the role of market activities in serving the Distribute-to- Originate model, while securing their profitability Revenues: +7% per annum 5 Cost/income: 64% 31% of RWAs 4 1. Including brokerage revenues (CLSA NY and Tokyo) reclassified under IFRS 5 in Q3-13 ( 42m in H1-13), restated for loan hedges and CVA/DVA impacts, pro forma for equity-accounting of UBAF under proportionate method in 2013 ; 2. Basel 3 RoTE, cost of risk assumption: c.30 bp of outstandings, including discontinuing activities, capital allocation of 9% of risk weighted assets and including main deductions from the CET1 numerator; 3. Restated for loan hedges, pro forma for equity-accounting of UBAF under proportionate method in 2013 ; 4. 96% of CIB's RWAs in ongoing activities and 4% in discontinuing activities; 5. Ongoing Capital Markets and Investment Banking, including brokerage revenues (CLSA NY and Tokyo) reclassified under IFRS 5 in Q3-13 ( 42m in H1-13), restated for CVA/DVA impacts 185 I Investor Day 20 March 2014