BPI : 2019 Second quarter and first half results

BPI Business line: Client conquest acceleration, commercial dynamism and increased profitability

• Underlying net income at €98M in Q2 2019, +9% (Q2/Q2), to stand at €178M at the end of June 2019, +11% (H1/H1), mainly driven by a growth in gross operating income and a decrease in the cost of risk in all BPIs.
• Underlying revenues at €75M in Q2 2019, +3.8% (Q2/Q2) came to €1,391M at the end of June 2019, +1.8% (S1/S1) confirming commercial activity dynamism.
• Cost/income ratio excl. SRF at 61% in Q2 2019 and 61.5% at H1 2019, a slight decline of 0.6points (H1/H1).

Over first half 2019, International retail banking contributed 7% to the underlying net income and 13% to the underlying revenues of the Crédit Agricole S.A. business lines.
In Q2, Italy accounts for 67% of net banking income and 77% of the on-balance sheet deposits of this business, followed by Poland and Morocco. CA Italia represents 57% of the underlying net income of the division, though.

CA Italia and CA Group in Italy

BPI in Italy - A solid commercial activity geared towards client acquisition in a still complex economic environment

A net client conquest of 12,000 clients in H1 2019

• Underlying net income at €59M in Q2 2019, +7% (Q2/Q2) to stand at €102M, +7.4% (H1/H1), at the end of June 2019
• Revenues in Q2 2019 was €483M, +1.3% (Q2/Q2) driven in particular by a good level of fees and commissions and interest margin
• Operating expenses were down slightly at €295M, -0.9% (Q2/Q2) mainly due to depreciation and amortisation, offset by lower staff costs.
• Cost of risk was €61M in Q2, down -1.9% (Q2/Q2) thanks to a continuous improvement of portfolio quality
• Cost/income ratio improved by 1.4 point (Q2/Q2) to 61.1% and reach 62% in H1 (stable)
• CA Italia RoNE stands at 9.5% in progress for the first half 2019.

Development of collect and credit outstanding at the end of June 2019

• Total customer assets at €75.7B at end of June 2019, thanks to strong off-balance sheet inflows at €35.2B at the end of June,+3.8%, offsetting the decline in on-balance sheet deposits of -3.8% over the same period.
• Outstanding loans reached €43B at end June 2019, stable (H1/H1) and +3.6% excluding non-performing loans disposal in 2018.

Remarkable business performance, in home loans and in consumer credit following the integration of the three acquired banks (end of Dec 2017).
Crédit Agricole Group in Italy
Loans outstanding amounted to €68B euros at the end of June 2019, up +2.7% year-on-year, while customer deposits and funds grew to €253B.
In first half 2019, Net income for all Crédit Agricole S.A. entities in Italy amounted to €344M, up +19% (H1/H1). They contributed for 13% to the underlying net income of the Crédit Agricole S.A. core businesses.

Other BPI

Continued growth thanks to an acceleration of commercial activity in the different entities. Highest growth results in all CA Group businesses

• Net income of Other BPIs was €39M in Q2 2019, +12.2% (Q2/Q2), thanks to an increase in gross operating income (+7.8%) and a continued decrease in cost of risk (-1.9%). Net income at the end of June was €76M, +16.4% (H1/H1)
• Revenues rose at 232M€, +9.4% in Q2 2019 (+3.7% hors effet de change) et €456M in H1, +9% (H1/H1)
• Operating expenses saw an increase of 10.5%, mainly due to activity in Egypt and Ukraine
• The cost/income ratio stood at 60.7%, an improvement of 0.6 point (Q2/Q2) and 1.9 point (H1/H1)

Development of collect and credit outstanding at the end of June 2019

• Total on- and off-balance sheet customer savings +14,7% (H1/H1) to €14,3B
• Loans outstanding at €11.5B€ at end June 2019, up +12.6% (H1/H1) driven by Ukraine (+27.9%) and Egypt (+14.3%)
  The surplus of deposits over loans remained at €1.4B at end June 2019.

 
By country in Q2 2019 vs Q2 2018:

• Egypt: NBI +9.6% and Net income rose sharply +12.7%
• Poland: NBI +3.1%, good control of expenses +2.4% and Net income increase by 6,6%
• Ukraine: NBI +12.2% and net income showed an increase of +11.5%
• Morocco: NBI +3.5% and increase in expenses of 4.4%, gross operating income grew by +2.7% and Net income stable
• In Serbia, performance is driven by a dynamic growth of the customer base (+10% over the quarter) and of collect and loans outstanding
• In Romania, the reorientation of the business continues and is confirmed by a satisfactory commercial performance

The Other BPIs now accounts for 7% of Crédit Agricole S.A.’s underlying net income (excluding the Corporate Centre) and show the strongest growth results of all Crédit Agricole Group business lines.

Document

• To read the press release, click here