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  • La Banque Postale Group

    October 2017

    INVESTOR PRESENTATION

  • LA BANQUE POSTALE

    Disclaimer

    2 October 2017 INVESTOR PRESENTATION

    This document has been prepared by La Banque Postale and La Banque Postale Home Loan SFH solely for use in investor meetings. This document is confidential and is not to be reproduced by any person, nor be

    distributed to any person other than its original recipient. La Banque Postale and La Banque Postale Home Loan SFH take no responsibility for the use of these materials by any person.

    This presentation does not constitute a prospectus or other offering document in whole or in part. Recipients should not subscribe for any securities issued pursuant to the Offering except on the basis of information in the

    prospectus in final form (including the documents incorporated by reference therein) to be issued by the Company in connection with the Offering.

    Information contained in this presentation is a summary only, and is qualified in its entirety by reference to the prospectus. The prospectus will include a description of risk factors relevant to an investment in the securities to

    be issued by the Company and any recipients should review in particular the risk factors before making a decision to invest.

    This presentation does not constitute or form part of any offer or invitation to sell or issue or any solicitation of any offer to buy or subscribe for any security nor shall it (or any part of it) form the basis of (or be relied on in

    connection with) any contract or investment decision in relation thereto. Recipients should conduct their own investigation, evaluation and analysis of the information set out in this document and should rely solely on their own

    judgment, investigation, evaluation and analysis in evaluating the Company, its business and affairs.

    No representation or warranty, express or implied, is given by or on behalf of the Company, the Joint Lead Managers, or any of their respective directors, officers, employees, advisers, agents, affiliates or any other person as

    to (a) the accuracy, fairness or completeness of the information or (b) the opinions contained in this document, and, save in the case of fraud, no liability whatsoever is accepted for any such information or opinions.

    The information and opinions contained in this presentation are provided as at the date of this document and are subject to change without notice although neither the Company nor any other person assumes any

    responsibility or obligation to provide the recipients with access to any additional information or update or revise any such statements, regardless of whether those statements are affected by the results of new information,

    future events or otherwise. All liability (including, without limitation, liability for indirect, economic or consequential loss) is hereby excluded to the fullest extent permissible by law.

    Certain statements included in this presentation are “forward-looking”. Such forward-looking statements speak only at the date of this document, involve substantial uncertainties and actual results and developments may

    differ materially from future results expressed or implied by such forward-looking statements. Neither the Company nor any other person undertakes any obligation to update or revise any forward-looking statements.

    All written, oral and electronic forward-looking statements attributable to the Company, or the Joint Lead Managers, or persons acting on their behalf are expressly qualified in their entirety by this cautionary statement.

    This document and the investment activity to which it relates may only be communicated to, and are only directed at (i) persons in the United Kingdom having professional experience in matters relating to investments, being

    investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the FPO); (ii) qualified investors (investisseurs qualifiés) as defined

    in Articles L411-2 of the French Monetary and Financial Code and (iii) persons to whom the communication may otherwise lawfully be made (together Relevant Persons). Any investment or investment activity to which this

    document relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. This document must not be acted or relied on by any persons who are not Relevant Persons.

    NOT FOR PUBLICATION OR DISTRIBUTION IN THE UNITED STATES - Nothing in this presentation shall constitute an offer of securities for sale in the United States. The securities referred to in this presentation (if any)

    have not been registered under the U.S. Securities Act of 1933, as amended (the Securities Act) or under the securities laws of any state of the United States , and may not be offered or sold in the United States absent

    registration or an exemption from registration under the Securities Act and applicable state securities laws.

    This document may contain a number of forecasts and comments relating to the targets and strategies of the La Banque Postale Group. These forecasts are based on a series of assumptions, both general and specific,

    notably – unless specified otherwise - the application of accounting principles and methods in accordance with IFRS (International Financial Reporting Standards) as adopted in the European Union, as well as the application of

    existing prudential regulations. This information was developed from scenarios based on a number of economic assumptions for a given competitive and regulatory environment.

    The Group may be unable:

    - to anticipate all the risks, uncertainties or other factors likely to affect its business and to appraise their potential consequences;

    - to evaluate precisely the extent to which the occurrence of a risk or a combination of risks could cause actual results to differ materially from those provided in this presentation.

    There is a risk that these projections will not be met. Investors are advised to take into account factors of uncertainty and risk likely to impact the operations of the Group when basing their investment decisions on information

    provided in this document. Unless otherwise specified, the sources for the rankings are internal.

  • LA BANQUE POSTALE

    Table of contents

    3

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    Senior Non Preferred inaugural transaction

    4

    7-year Senior Non Preferred notes

    Nominal amount: €500M no grow

    Expected rating: BBB (S&P)

    Issuance expected to be fully MREL eligible

    INVESTOR PRESENTATION

    Rationale

    Offering

    Contributing to fulfill anticipated MREL requirements

    Further optimising the eligible liabilities structure with Non-Preferred Senior

    Diversifying funding sources and investor base

    La Banque Postale foresees limited amount of debt to issue in the future to

    reach MREL targets, meaning one Benchmark per year over the medium

    term, potentially combined with private placement opportunities

    Strong and supportive shareholding structure

    Strong capital base with a total capital at 18,9% as of H1 2017 (phased-in)

    Key investments highlights

    October 2017

  • LA BANQUE POSTALE

    Inaugural Senior Non Preferred – Key structural features

    5 INVESTOR PRESENTATION

    Issuer La Banque Postale

    Issuer ratings A stable (S&P): A- stable (Fitch)

    Expected Rating BBB (S&P)

    Maturity October 2024 (7 year)

    Notional Amount €500,000,000

    Structure Fixed coupon, bullet

    Status Non-Preferred Senior

    Ranking of the notes Direct, unconditional, unsecured and senior obligations of the Issuer ranking at all times: (i) pari passu among themselves and with other Senior Non Preferred Obligations (ii) senior to Eligible, Ordinarily Subordinated Obligations and any other present or future claims otherwise ranking junior to Senior Non Preferred Obligations (iii) junior to present and future claims benefiting from preferred exceptions including Senior Preferred Obligations

    Denomination EUR 100,000 + EUR 100,000

    Early Redemption Event MREL Disqualification Event and Tax Event

    Bail-in The Notes are subject to bail-in in accordance with the EU Bank Recovery and Resolution Directive as transposed into French Law

    Substitution or variation No

    Documentation EMTN prospectus dated 11 September 2017

    Listing/ Applicable Law Euronext Paris / French law

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    6

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    A solid and stable shareholding structure and a core subsidiary for Le Groupe La Poste

    7

    La Banque Postale is wholly-owned by La Poste, the French

    Postal Service

    La Poste is structured around 5 business units, dedicated to

    fulfill 4 public service missions assigned by the French State:

    Universal postal services

    Contribution to regional planning

    Press transport and delivery

    Banking accessibility

    LBP is considered as a core strategic subsidiary of La Poste:

    La Poste is legally bound to keep a majority stake in LBP

    (Law of regulation of postal activities, 2005)

    LBP is an essential contributor to La Poste income

    LBP is, by law, enabled to use La Poste’s staff for its

    activities

    73.7%

    100%

    100% *

    26.3%

    INVESTOR PRESENTATION

    The backbone of La Banque Postale

    * Caisse des dépôts et consignations and its subsidiaries constitute a State-owned group at the service of the public interest and of the country’s economic development. The said group fulfils public interest functions in support of the policies pursued by the State and local authorities, and may engage in competitive activities. (Article L. 518-2 of the French Monetary Financial Code)

    October 2017

  • LA BANQUE POSTALE

    La Poste : a major multi-business services group

    8 INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    La Banque Postale (LBP) : from La Poste’s Financial Services… into a fully fledged bank

    9

    1817 2000

    Creation of

    Efiposte

    (manages sight

    deposits

    collected by La

    Poste)

    Creation of the first

    postal service

    mandate named

    ‘Reconnaissance’

    31/12/2005

    Efiposte

    becomes

    La Banque

    Postale

    2007

    Consumer

    Finance

    2009 2011

    Corporate

    lending

    La Banque

    Postale

    Crédit

    Entreprises

    La Banque

    Postale

    Assurances

    IARD

    A long history of La Poste’s

    financial services But still a short history as a fully-fledged bank

    2012

    Lending to

    French local

    authorities

    La Banque

    Postale

    Collectivités

    Locales

    La Banque

    Postale

    Financement

    P&C

    Insurance SFH

    BPE

    La Banque

    Postale

    Home Loan

    SFH

    2013 2014

    Sofiap

    2015

    Partnership

    with Aegon

    AM

    Merger BPE /

    LBPGP

    Wealth

    Management

    Unit

    Since 2006, LBP has gradually acquired tools and built up a network of partnerships to accelerate its development and achieve its full

    potential

    Before 2006, La Poste’s financial services business was mainly focused on savings. Since, LBP developed its

    product range and became a fully-fledged retail bank

    • With diversified lending activities, enhancing LBP’s role in financing the French economy

    • Committed to serve all clients, all over the French territory

    • With strong social responsibility involvement: in 2017, LBP is ranked No. 3 worldwide and No. 1 in France by

    the extra financial rating agency Oekom for its performance in terms of Corporate Social Responsibility

    INVESTOR PRESENTATION

    2016

    LBP

    Prévoyance

    Merger

    Federis/

    LBPAM

    2017

    KissKiss

    BankBank

    Asset

    management Crowdfunding

    October 2017

  • LA BANQUE POSTALE

    La Banque Postale (LBP): A business model based on core business development

    and successful partnerships

    10

    A very active partnership policy with major players in order to accelerate new businesses launches, relying on

    safe and efficient operational process

    Retail banking

    Private banking / discretionary portfolio

    management

    Consumer finance

    Public sector lending

    Non-profit organizations & Corporate

    banking

    Life insurance

    P&C

    Health Insurance

    Contingency insurance

    Insurance

    Asset management for individuals

    Asset management for companies

    Real estate

    Asset Management

    Partnership in Consumer finance

    FINANCEMENT

    65%

    owned

    by LBP

    Partnership in Public sector lending

    Partnership in

    Life insurance

    20.15% owned by LBP

    Partnership in

    P&C

    ASSURANCES

    IARD

    65%

    owned

    by

    LBP

    Partnership in

    Health Insurance

    ASSURANCES

    SANTE

    51%

    owned

    by

    LBP

    ASSET

    MANAGEMENT

    25% of

    Partnerships in Asset

    Management

    5% of

    Retail Banking

    70%

    owned

    by

    LBP

    35% of

    14% of

    INVESTOR PRESENTATION

    40% owned

    by LBP

    60% of

    20% 75% 5%

    100%

    October 2017

    http://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRxqFQoTCKXaq5jB_MgCFcNXGgodVP8MlQ&url=http://www.ue-finance.com/en/index.html&psig=AFQjCNEtkxcSYay_YGSCvxuawNLB0_s-6A&ust=1446923759527336

  • LA BANQUE POSTALE

    La Banque Postale (LBP): a core focus on Retail banking and a leading position on the

    French banking system

    11

    Contribution to net income before tax H1 2017

    Insurance (including share of profits

    from CNP) 27%

    Asset Management

    7%

    Retail Banking 66%

    10.6 million active retail customers

    13.4% market share on ordinary savings (all savings accounts

    except CEL) and 23.2 % market share on the Livret A

    5.8% market share on home loans outstandings**

    Key figures of retail banking activity at H1 2017

    Retail banking in France NBI H1 2017 ***(€bn)

    ** Including BPE and Sofiap

    *** Press releases reports, H1 2017

    **** Sofia Study, March 2016

    ***** Retail banking France, Registration Document or press releases, YE 2016

    LBP in the French banking environment

    2,9

    3,2

    4,1

    3,2

    3,6

    1,8 LCL

    Crédit Agricole 6,6

    Caisses d’Epargne

    Banques Populaires

    Société Générale

    BNP Paribas

    LBP

    6,2

    7,3

    6,4

    6,7

    22,1

    Caisses d’Epargne 13,2

    Banques Populaires

    Société Générale

    BNP Paribas

    LBP 17,6

    LCL

    Crédit Agricole

    Penetration rates on main current account March 2016 (%)****

    Number of branches YE 2016 (m)*****

    8,8

    2,0

    3,0

    3,3

    4,2

    7,0

    1,9

    Caisses d’Epargne

    LCL

    Crédit Agricole

    Banques Populaires

    Société Générale

    BNP Paribas

    LBP

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    A solid and stable shareholding structure, reflected in strong credit ratings

    12

    France AA / Stable (April 2017) AA / Stable (July 2017)

    Caisse des Dépôts et Consignations AA / Stable (May 2017) AA / Stable (December 2016)

    Le Groupe La Poste A / Stable (December 2016) A+ / Stable (Dec 2016)

    Latest rating update November 2016 April 2017

    Long term debt A / Stable A- / Stable

    Short-term debt A-1 F1

    Tier 2 BBB-

    La Banque Postale Home Loan SFH AAA / Stable (May 2016)

    La Banque Postale’s credit ratings

    LT debt ratings of La Banque Postale’s stakeholders

    INVESTOR PRESENTATION

    Fitch affirms La Banque Postale at « A- », stable outlook (04/25/2017) : « LBP’s ratings reflect it established franchise in

    deposit collection and housing loans in France, low risk appetite, good asset quality and sound capitalisation, taking into account

    potential ordinary support from its parent La Poste (A+/Stable), France’s state-owned post office ».

    S&P affirms La Banque Postale at « A », stable outlook (11/29/2016) : « S&P Global Rating’s stable outlook on La Banque

    Postale (LBP) mirrors the stable outlook ont its parent, La Poste, over the next two years. We expect LBP to remain a core

    subsidiary of La Poste… in addition, we could upgrade LBP if we raise the long-terme rating on La Poste ».

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    13

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    La Banque Postale at a glance

    14

    2016 Key financial figures

    Strong capital and high liquidity at YE 2016

    Consolidated results (in €m) YE 2016 YE 2015

    Net banking income*

    Excluding home savings provision

    5,602

    5,461

    5,745

    5,809

    Operating income 834 871

    Net Income, Group Share 694 707

    Cost to income ratio 82.4% 82.1%

    CET1 fully loaded: 14.3% **

    Total Capital ratio (phased-in): 19.4%

    Leverage ratio: 4.6% ***

    LCR liquidity ratio: 179%

    Company profile

    Created in 2006 but a long track record in financial

    services

    Wholly-owned by La Poste, the French Postal Service

    A resilient business model

    Retail Banking: 94% of NBI (YE 2016)

    Recurrent revenues

    Conservative risk policy

    Sound ratings:

    A (stable outlook) by S&P

    A- (stable outlook) by Fitch

    Key facts 2016

    94%

    3% 3%

    Retail BankingAsset ManagementInsurance

    Customer deposits €173bn

    Retail active Customers

    Post offices (YE 2016)

    NBI Split by Business

    ˜10.7m

    ˜8,900

    *scope effect €20m (Ciloger and Federis) **Phased-in ratio at 13,7% ***Change in 2016 methodology : by a decsision of the ECB of 24 August 2016, La Banque Postale is authorised to integrate gradually and linearly up to 2022 its CDC exposure. Estimated ratio of 5% taking into account the delegated act published by the European Commission on Oct 2014.

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    A quick sum up on H1 2017 results

    15 INVESTOR PRESENTATION

    Consolidated income statement (€ millions)

    Main items in the income statement

    H1 2017 H1 2016 %

    Net Banking Income

    excluding disposal of Visa shares, effects of home loan savings

    provision and on a like-for-like basis

    2,808

    2,974

    -5.6%

    + 1.6 %

    Operating expenses

    On a like-for-like basis

    (2,331)

    (2,388)

    -2.4 %

    -2.2%*

    Gross operating income 477 586 -18.6%

    Cost of risk -71 -84 -15.2 %

    Operating income 406 502 +52.9%

    Share of income from equity associates 133 87 -7.6 %

    Pre-tax income 538 588 -8.5%

    Net income, Group share 367 360 +1.7%

    Cost-income ratio 83.6% 80.7% +290bp

    Capital and liquidity H1 2017

    CET1 fully loaded ratio: 13.8% *

    Total Capital ratio (phased-in): 18.9%

    Leverage ratio: 4.5% **

    LCR liquidity ratio: 174%

    Business activities H1 2017 vs H1 2016

    *Phased-in ratio at 13.6% **Change in 2016 methodology : by a decsision of the ECB of 24 August 2016, La Banque Postale is authorised to integrate gradually and linearly up to 2022 its CDC exposure. Estimated ratio of 5% taking into account the delegated act published by the European Commission on Oct 2014.

    Home loans outstandings : +5,7%

    Consumer loans outstandings : +6,3%

    Corporates and local public sector loans outstandings : +34%

    Ordinary savings outstandings: +1.1%

    Life insurance outstandings :+0,8%

    *Ciloger for €6M

    October 2017

  • LA BANQUE POSTALE

    A growing loan portfolio with the development of new businesses

    16

    New home loans production during H1 2017: €8.2bn versus €4.bn in H1 2016 (+77.6%)

    New consumer loans production : €1.2bn versus €1.2bn in H1 2016 (+2.8%)

    Loans granted to corporates and local public sector : €7.3bn versus €5.3bn in H1 2016 (+34%)

    A dynamic loan production …

    Outstanding loans to corporates (in €bn)

    Home loans outstandings* (in €bn) Consumer loans outstandings (in €bn)

    50 53 54 55

    56 58

    5,7%

    H1 2017 2016 2015 2014 2013

    3,4 4,0

    4,5 4,7 4,9 5,0

    +6,3%

    2016 2015 2014 2013

    1,8 2,9

    5,3 6,6

    8,8 10,6

    +61,8%

    2016 2015 2014 2013

    INVESTOR PRESENTATION

    … and a growing loan portfolio

    *Including BPE and Sofiap

    Outstanding loans to local public sector (in €bn)

    2,2 3,6

    4,5 4,2 5,7 5,3

    +27%

    2016 H1 2016 2015 2014 2013

    H1 2016

    H1 2017

    H1 2016 H1 2017

    H1 2016 H1 2017

    74%

    6%

    13% 7%

    October 2017

  • LA BANQUE POSTALE 17

    Dynamism of Insurance and Asset Management businesses

    2016

    180.6

    2015

    178.3

    +6.9%

    Asset management : AUM (in billions of euros)*

    LBPAM: €191.3 billion in assets under management, up by 6.9% on a

    like-for-like basis

    A €23bn management mandate with CNP has been signed in July 2017

    and will bring AUM to over €210bn in H2 2017

    Tocqueville Finance: €1.7 billion** in assets under management, up by

    12.8%

    *Assets at end of period, including Fédéris assets in 2015 **Excluding LBPAM delegation

    An overall portfolio of policies at almost 4,516,000, up by 3.2%

    P&C insurance (IARD): portfolio +9.4%

    Health insurance: over 177,000 policies (portfolio up by 25.7%): success of

    ACDS (Assurance Coups Durs Santé, or hard times health insurance) and

    "Oui Santé" ("Yes to Health" - Aide à la Complémentaire Santé, or

    supplementary health insurance assistance)

    Contingency insurance: over 2,730,000 individual policies (portfolio stable)

    Life insurance : almost 5,115,000 policies, totalling €125bn

    Insurance: trend in policy portfolios (in thousands)

    4,220

    2,758

    109

    H1 2016

    +3.2%

    Contingency

    P&C

    Health

    2016

    4,374

    2,763

    1,470

    141

    2015*

    * Proforma 2015 in Health Stock

    INVESTOR PRESENTATION

    2,758

    1,353 1,539

    2,751 2,730

    1,608

    163 177

    H1 2017

    178.9 191.3

    H1 2016 H1 2017

    4,453 4,515

    2015 2016

    October 2017

  • LA BANQUE POSTALE

    Group net banking income dynamics

    18

    2016 published

    2,578

    (+0.7%)

    3,024

    (-5.1%)

    2015 published

    1,335

    1,639

    2,559

    3,187 Commissions and other

    NIM

    • Including effects of home loan savings, scope and Visa

    Net Banking Income down -5.6%

    Positive change in NBI (+1.6%) excluding home loan savings

    provision, disposal of Visa shares and on a like-for-like basis

    Strong rise in the insurance division linked to the overall

    increase in premiums, an improved loss ratio and good financial

    results

    INVESTOR PRESENTATION

    1,434

    (-12,5%)

    1,374

    (+2,9%)

    H1 2016 published

    H1 2017 published

    44.5%

    44.9% 46.0%

    48.9%

    Growing portion of commissions in NBI

    Commissions accounting for a growing portion of revenue

    revenue from commissions and other +2.9% in H1 2017;

    commissions and other accounting for 45% of revenue.

    Low interest rates weighing on the net interest margin: -12.5%

    H1 2016 Visa retail banking insurance assetmanagement

    H1 2017

    2,974

    2,808

    -5.6%

    -107

    -73 23

    -9

    NBI evolution during H1 2017 driven by:

    Scope effect coming from the disposal of Visa shares in H1 2016

    Low interest rates

    Growing portion of commissions and fees

    October 2017

  • LA BANQUE POSTALE

    An ongoing effort to improve efficiency

    19

    Operating expenses’ breakdown (%)

    Focus on external services and other expenses (%)

    INVESTOR PRESENTATION

    €2,331m (-2.4% yoy) reflect efforts to contain expenses despite

    significantly increased charges for subsidiaries to support their

    development :

    Decrease in Retail banking operating expenses (-2.4% at

    €2,236m), including:

    - -2.7% for LBP SA

    - +5% for Retail banking subsidiaries, in support to their

    development

    A dedicated plan (“Excellence 2020”) focused on quality of

    service and based on an investment programme and a

    comprehensive overhaul of major processes

    €1bn in investments over the period 2014-2020

    A programme to boost operational and commercial efficiency

    (reorganising salesforces ; comprehensive review of main front-to-

    back processes)

    … to generate 10% in annual savings in operating expenses

    from the year 2020

    240 238

    -2.4%

    Amortisation and provision

    External services and other expenses

    Taxes and duties

    Employee benefit expenses

    H1 2017

    2,331

    88

    1,971

    33

    H1 2016

    2,388

    89

    2,004

    56

    Other operating costs

    23%

    Back office and IT* 22%

    Customer advisors / salesforce* 30%

    Counter and ATM transactions*

    24%

    * Service sharing agreements signed with La Poste represent around

    80% of « external services and other expenses » and two thirds of

    total expenses.

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    20

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    A cost of risk reflecting a conservative risk management

    21

    LBP Group cost of risk (€m)

    NPL and coverage ratio – Retail banking in France

    LBP Group cost of risk (bps)*

    16

    21

    30

    22

    14

    18

    LCL Caisse d’Epargne

    Banque Populaire

    Société Générale

    BNPParibas LBP

    Source: H1 2017 reports, consolidated financial statements

    -3bp

    2016

    22

    2015

    23

    2014

    * Cost of risk on loans in bp, based on average outstanding at the start of the period

    Low risk appetite and stringent controls in place

    Total cost of risk decreased significantly (-15.2%), and commercial

    credit activities cost of risk low at 16 bps, despite growth in

    outstanding loans and reinforcement in risk coverage

    163

    181

    84

    181

    71

    2015 2014

    -15.2%

    2016

    INVESTOR PRESENTATION

    H1 2016

    H1 2017

    23 19

    16

    H1 2016 H1 2017

    1.8%

    3.4%

    4.6%

    3.4%

    1.7%

    LCL BPCE Société Générale

    BNPParibas LBP

    Source: H1 2017 reports, consolidated financial statements

    Cost of risk – Retail banking in France (bps)

    34.8% 62.0% 89.0% 82.7% 75.1%

    October 2017

  • LA BANQUE POSTALE

    Strong asset quality

    22

    High quality of retail lending portfolios

    81% of the total portfolio is individual customers’

    based

    A progressive and controlled diversification of

    lending businesses

    A conservative financing approach, focusing on

    stringent management

    High quality of investment portfolios (HTM and AFS YE 2016)

    INVESTOR PRESENTATION

    Corporate

    5%

    Bank

    25%

    Sovereign 69%

    Other

    28%

    AAA and AA

    72%

    84%

    6% 10%

    France

    Outside Euro zone

    Euro zone

    Credit risk still accounting for most of total RWAs (€bn)*

    Basel 2 / 2.5 Basel 3 / CRR

    30.0

    8.3 Operational RWA

    2013 2012

    Market RWA

    2014

    Credit RWA

    39.1

    0.8

    45.2

    8.5

    35.9

    0.8

    2015 2016

    8.9

    42.5 43.8

    2.1

    48.2

    1.3

    52.7 54.2

    1.2

    9.2

    59.5

    9.3

    2.6

    51.0

    62.9

    9.3

    H1 2017

    * RWA computed following the standard method

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    23

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    Balance sheet breakdown

    24

    Balance sheet at 30 June 2017 2016: €233bn, +€3bn vs YE 16

    Large customers’ deposits base : €176bn

    LBP “centralises” at CDC* all funds deposited on Livret A and

    LDD regulated savings accounts and since H1 2016, only half of

    LEP regulated savings accounts, with no interest rate or liquidity

    risk (it is a pure pass-through): €71bn

    Remaining part of the deposit base (not centralised to CDC)

    amounting to €101bn:

    is used to fund customer lending and mainly home loan

    activity

    is invested in a “SSA bond” portfolio mostly classified in

    Held To Maturity (dating back to before LBP was created

    and mainly consisting in HQLA bonds) and a credit

    spread portfolio

    *CDC: Caisse des Dépôts et Consignations

    LBP balance sheet at 30 June 2017(€bn)

    Customer deposits/

    savings €176bn

    13

    19

    21

    21

    58

    71

    Others

    Short term assets and Central Bank

    AFS Portfolio

    HTM Portfolio

    Home loans

    Centralised regulated savings

    Assets

    233

    14

    20

    13

    101

    75

    10

    Own funds and hybrids

    Other Liabilities and Provisions

    Repo

    Debt securities

    Customer deposits/savings excluding regulated savings

    Regulated savings

    Liabilities

    233

    Assets out of regulated

    savings centralised

    at CDC €162bn

    INVESTOR PRESENTATION

    30

    Other loans to customers

    October 2017

  • LA BANQUE POSTALE

    Diversifying funding sources to support lending growth

    25

    Diversified long term wholesale funding sources (at YE 2016)

    INVESTOR PRESENTATION

    In addition to a large customer deposit base, LBP has

    diversified wholesale funding sources:

    Short Term:

    - Interbank funding: €20bn Neu CP programme

    - Repo: Large valuable portfolio of high quality

    securities

    Medium to Long Term:

    - Access to EIB (European Investment bank) long

    term funding

    - Agreement with SFIL/CAFFIL to refinance French

    local authorities loan production

    - Senior unsecured EMTN programme

    - Neu MTN programme (in progress)

    - Covered bond programme through LBP Home

    Loan SFH

    In order to develop its lending activity, LBP is gradually

    rebalancing its funding sources by increasing its long term

    wholesale funding

    Tier 2 and Senior 38%

    18%

    44%

    Covered bonds

    LT Repo

    Total: €8,1bn

    October 2017

  • LA BANQUE POSTALE

    A strong and stable liquidity position

    26

    Loan to deposit ratio

    Well diversified euro wholesale funding investor

    base with gradual development towards dollar

    investors

    Sound financing structure with a loan to deposit ratio

    at 75,6%* at 30 June 2017

    * Loan to deposit ratio, excluding Livret A and LEP and LDD deposits centralised at the Caisse

    des Dépôts et Consignations

    Group’s LCR and liquidity buffer (€bn)

    LCR: 174% at 30 June 2017

    - A strong liquidity buffer with 96% of level 1 assets

    H1 2017

    174.3% 179.5%

    Level 1

    Level 2

    H1 2017

    22.7

    21.8

    0.7

    INVESTOR PRESENTATION

    2016

    59% 67% 75% 75% 74%

    2012 2013 2014 2015 2016 H1 2017

    L/D ratio

    76%

    The liquidity coverage ratio (LCR) calculation underwent a revision at 31 March 2017 due to a change in the treatment of the European Central Bank’s marginal facility deposit. The variation displayed corresponds to the relative variation between the LCR at 30 June 2017 and the LCR at 31 December 2016 recalculated according to the new method (i.e. 179.5%). The published LCR for 31 December calculated according to the old method was 260%.

    HQLA

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    27

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    LBP strong capital position (1/2)

    28

    Prudential ratios – building capital buffers (phased-in) CET1 phased-in (€m)

    Leverage ratio

    *Change in 2016 methodology by a decsision of the ECB of 24 August 2016, La Banque Postale is authorised to

    integrate gradually and linearly ip to 2022 its CDC exposure.:

    **Estimated, taking into account the delegated act published by the EC on Oct 2014.

    2016

    5,2% 4,6%

    2015

    5,2%

    3,5%

    Including delegated act**

    Without delegated act*

    367 154

    +4.4%

    CET1 30.06.2017

    8,527

    Others Dividend project

    -165

    Profit

    CET1 31.12.2016

    8,171

    Total

    19.4% 18.7%

    Tier1

    15.1% 14.7%

    CET1

    13.7% 13.2% H1 2017

    2016

    2015

    CET1

    AT1

    T2

    H1 2017

    18.9%

    13.6%

    1.2%

    4.1%

    CRDIV :

    Fully loaded CET1 of 13.8% at H1 2017: LBP

    displays a higher fully loaded ratio than its

    phased-in CET1 ratio because of significant

    stock of unrealised gains

    EBA’s 2016 stress tests results prove LBP’s solid

    resilience and ability to face an adverse context :

    The adverse imposed scenario would lead La

    Banque Postale to reach a phased-in CET 1 ratio

    of 9.7% at YE 2018.

    INVESTOR PRESENTATION

    5,3% 4,5%

    H1 2017

    13.6% 14.8%

    18.9% SREP

    requirements

    7.625% CET 1 including P2R

    11.125% Total Capital

    October 2017

  • LA BANQUE POSTALE

    LBP strong capital position (2/2)

    29

    Ability to generate capital to support future growth

    Capital management philosophy

    LBP and Group LP are committed to manage adequate

    solvency levels to support LBP’s strategy as evidenced

    by several capital actions

    Maintaining a prudent approach on capital…

    Consistently above 10% CET1 since LBP creation

    … under conservative solvency calculations

    Assessing Pillar 1 risk under standard approach

    INVESTOR PRESENTATION

    Basel 2 / 2.5 Basel 3 / CRR

    11.4%

    12,7% 13,2% 14,2%

    15,1% 14,8%

    2011 2013 2014 2016 H1 2017

    AT1

    Core Tier 1

    12.7%

    First capital

    increase

    of €860m

    Capital increase of

    €228m and AT1

    issue of €800m

    Capital increase

    of €633m

    LBP Tier 1 ratios and La Poste Group support

    13.7% 13.6%

    October 2017

  • LA BANQUE POSTALE

    MREL and TLAC considerations

    30

    Total Loss Absorbing Capacity considerations

    As an “O-SIB” and as of today, La Banque Postale is not

    subject to TLAC such as defined by the FSB

    La Banque Postale is subject to the MREL defined in the

    BRRD (Minimum Requirement for own funds and Eligible

    Liabilities)

    On November 23rd 2016 the European Commission

    proposed amendments on BRRD. This proposed reform

    package introduces TLAC in European law and amends

    MREL

    MREL As of 23/11/16 reform package

    TLAC As of FSB 2015 termsheet

    Covered Entities All EU credit

    institutions

    International G-SIBs All EU credit institutions

    Denominator Total liabilities and

    own funds

    RWAs / Leverage ratio

    exposure

    RWAs / Leverage ratio exposure

    Minimum Ratio Bank specific level,

    no legal floor

    16% initially then 18%

    RWAs+ Capital Buffers /

    6% then 6,75% Leverage

    ratio

    Bank specific level, capped at

    Max [2x(P1+P2R) ; 2 x

    Leverage requirement], with

    guidance on top

    Floor for G-SIBs (TLAC level)

    Eligible

    Liabilities

    Wider definition

    than TLAC (senior

    preferred debt is

    eligible without

    limitation)

    Subordinated

    instruments

    Possibility for pari

    passu instruments to

    excluded liabilities

    limited to 3.5%

    Closer to TLAC

    3.5% limitation applies to the

    G-SIBs floor

    Resolution authority may

    require partial or full

    subordination for bank specific

    requirement

    Date Starting Jan’16;

    phase-in period

    Jan’19 No specification on phase-in

    period

    INVESTOR PRESENTATION

    Building capital buffers (phased-in ratios)

    MREL As of BRRD1

    TLAC vs. MREL

    12,7% 13,2% 13,7% 13,6%

    1,5% 1,5% 1,4% 1,2%

    2,8% 4,0% 4,3% 4,1%

    2014 2015 2016 H1 2017

    Tier 2

    AT1

    CET 1

    17,0% 18,7%

    19,4% 18,9%

    October 2017

  • LA BANQUE POSTALE

    Table of contents

    31

    Senior Non Preferred inaugural transaction

    Overview and business model

    Key figures and results

    Risk management

    Funding and Liquidity

    Capital

    Wrap-up

    INVESTOR PRESENTATION October 2017

  • LA BANQUE POSTALE

    La Poste Network : a multi-business network with a banking activity

    32 INVESTOR PRESENTATION

    17,159 retail outlets in France o.w. 51,6% post offices (8,835)

    and 48.4% partnerships (versus 46% in 2015)

    436 millions of visits

    96.7% of the French population lives less than 5 km away from a

    retail outlet

    83% of the French population stated they had visited their post

    office at least once to carry out postal or banking transactions in

    2016

    53,700 employees, with more than 80% working in post offices

    An exceptional granularity*

    17% of Mail revenue

    80% of La Poste Mobile sales

    25% of Parcels revenue

    100% of net collection for individuals

    80% of property loans**

    67% of consumer loans

    of Chronopost revenue 7%

    Commercial activity of La Poste Network*

    * Le Groupe La Poste 2016 Registration Document

    ** Excluding social housing loans

    1,175 million transactions completed at its counters and automated postal machines, i.e :

    622 million bank transactions and 7 million banking advice appointments completed by banking advisers located in the Network, i.e :

    October 2017

  • LA BANQUE POSTALE

    Alternative Performance Measures

    33 INVESTOR PRESENTATION

    Alternative Performance Measures Definition and method of calculation

    NBI excluding the effect of the home savings provision NBI restated for provisions or reversal of provisions on liabilities related to home savings accounts (PEL and CEL)

    Operating expenses Sum of operating expenses and net depreciation and amortisation and impairment of property, plant and equipment and intangible assets

    Cost-income ratio Operating expenses divided by NBI corrected for doubtful interest

    Cost of risk in basis points Average commercial banking credit risk costs for the quarter divided by outstandings at the beginning of each quarter

    Article 223-1 of the AMF regulations

    October 2017

  • LA BANQUE POSTALE

    Contact details

    34

    Stéphane Magnan [email protected]

    Head of Financial Markets

    Dominique Heckel [email protected]

    Head of Long Term Funding

    Denys Médée [email protected]

    Head of Balance Sheet Management and Relations with Supervisory Authorities

    INVESTOR PRESENTATION October 2017

    mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]

  • LA BANQUE POSTALE

    La Banque Postale

    La Banque Postale

    115 rue de Sèvres

    75275 Paris Cedex 06

    www.labanquepostale.com