SOCIETE GENERALE PRESENTATION TO DEBT INVESTORS INVESTOR DAY D E C E M B E R 2 0 1 7
1 INTRODUCTION
A EUROPEAN LEADER CONNECTING EUROPE TO THE REST OF THE WORLD FRENCH RETAIL BANKING (1) 39,000 employees RUSSIA 12 million customers, AMERICAS 3% 3% 3% including 810,000 corporates, 7% 7% 7% professionals and associations CEE EUR 185bn in outstanding loans 10% 10% 10% WESTERN INTERNATIONAL RETAIL BANKING AND EUROPE FINANCIAL SERVICES (1) 69% 69% 69% ASIA - OCEANIA 73,000 employees 6% 6% 6% AFRICA 32 million customers, 5% 5% 5% including 1 million corporate customers and 13 million insurance policyholders EUR 108bn in outstanding loans GLOBAL BANKING AND INVESTOR SOLUTIONS (1) 21,000 employees Assets under management (Lyxor and Private Banking): EUR 222bn Assets under custody: EUR 3,955bn % % of 2016 Group revenues EUR 149bn in outstanding loans (1) Figures as of Q4 2016 PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 3
2 OUR MAIN TAKEAWAYS
A TRANSFORMED GROUP AT THE FOREFRONT OF MARKET TRENDS AND INNOVATION � Boursorama: supporting online MORE RESPONSIBLE MORE FOCUSED banking growth � Pioneer in Asset Management consolidation � CSR ambition at the heart of � Anticipating post trade evolution � 45 disposals in all businesses our strategy since 2014 � ALD: at the heart of mobility � Firm-wide Culture & Conduct � Selected investments in trends programme sponsored by the CEO growth/synergetic franchises MORE RESILIENT MORE ROBUST � Less volatile earnings � Strong capital position � Negligeable prop trading revenues � Improved Group risk profile � Turnaround in key emerging � Enhanced independent control geographies functions PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 5
WHAT WE DELIVERED ON OUR 2014 PLAN Key 2014 Investor Day targets vs. actual 2014 ID targets � � � �� We delivered on costs, cost of risk and Revenue growth Costs Cost/income Cost of Risk pay-out ratio CAGR +3% CAGR +1% 62% 55-60bp +2% 16.8 16.1 We moved capital to a higher base than +1% 25.7 (1) planned 66% 68% (3) 24.4 16.8 (2) 16.1 81 37 However, we suffered from a weaker 2013 2016 2013 2016 2013 2016 2013 2016 environment for revenue generation � �� � Capital ROE Pay-out ratio � Low / negative interest rates CET1 > 10% ≥ 10% 50% Total Capital ≥ 15% � Russian crisis 17.9% 9% (4) Total 13.4% (5) Therefore, we did not meet our revenues, Capital ~50% ~50% ~40% cost/income ratio and ROE targets 7.5% 8% (1) 11.5% 10% CET1 2013 2016 2013 2016 2014 2015 2016 Note: 2013 is adjusted for changes in Group structure that occurred between 2013 and 2016 (1) Excluding non-economic items (revaluation of own financial liabilities and DVA) (2) Underlying operating expenses adjusted for Euribor fine refund, RMBS litigation and cost to achieve savings plan (3) Including legacy assets in 2013 (4) Adjusted for non-economic, exceptional items and transformation costs, calculated with CET1 capital set at 10% (5) Pro forma Basel 3 PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 6
WHAT WE DELIVERED ON CAPITAL CT1 / CET1 trajectory Shareholders’ equity doubled over the BASEL 2.5 BASEL 3 past 10 years BASEL 2 (CRD3) (CRR/CRD4) � Capacity to anticipate regulatory evolutions with 14.0% 78.0 11.7% 11.5% 11.3% 10.9% 10.7% limited impact on franchises 10.1% 12.0% 68.0 9.0% 8.5% 8.4% 10.0% 58.0 48 � Agile and disciplined RWA management 47 6.7% 45 43 42 42 8.0% 48.0 39 37 6.0% 38.0 30 � Continued strengthening of CET1 ratio 28 24 4.0% 28.0 18.0 2.0% Proactive management of both TLAC 8.0 0.0% ratio (1) (21.6%) and leverage ratio (4.3%) (2) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Q3 17 ROE Equity (EUR bn) CT1/CET1 TLAC trajectory (1) CET1 Ample CET1 buffer over MDA threshold 11.7% 9.6% 21.6% 21.1% (210 bps in fully-loaded vision) 210 bps 0.1% 19.0% Countercyclical buffer buffer 16.8% 1.0% GSIB buffer � Comfortable level of Available Distributable 2.5% Cap. Conserv. buffer Items (~EUR 14bn as of 31/12/2016) 1.5% Add-on P2R Pillar 1 4.5% 2014 2015 2016 Q3 17 MDA Requirement CET1 Q3 17 (1) Incl. 2.5% of Preferred Senior (fully loaded) (2) Both ratios as of Q3-17 PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 7
HOW WE IMPROVED ON LIQUIDITY & FUNDING Liquidity reserve Loan to Deposit Very strong balance sheet and proven capacity Ratio (3) As of 30/09/17 1,000 110% 104% to anticipate requirements: (EUR bn) 900 105% 98% 800 95% 100% � High quality liquid asset buffers High Quality Liquid 93% 93% 16 700 Assets (L1) 95% � Diversified and sustainable funding mix 600 54 High Quality Liquid 441 90% 453 EUR 422 Assets (L2) 500 340 377 421 412 � Regular improvement of the loan to deposit ratio 402 85% 155bn 369 354 400 Central Bank 80% 76 Deposits � Compliance with fully-loaded regulatory ratios ahead 300 9 75% Others 200 of their enforcement (LCR and NSFR ratios already Other ECB eligible assets 100 70% above 100%) Q4 13 Q4 14 Q4 15 Q4 16 Q3 17 Reserve covers 186% of short-term resources (4) Prudent ALM with a centralized monitoring by Loans Deposits L/D Ratio Group Treasury Group funding to International Funding from US money � Limited usage of cross currency swaps to finance Retail Banking subsidiaries (2) market funds (1) USD (and other non-EUR) assets (EUR bn) (USD bn) 46.0 � 20 to 25% of Group balance sheet in USD with an 9.2 excess of USD resources 6.4 27.3 26.4 � Low dependence on Money Market Funds 4.5 3.9 15.4 15.1 � Limited reliance of international retail banking 8.1 6.4 6.8 subsidiaries on parent company funding 1.2 1.1 0.8 (1) Sources: SEC Form N-MFP2, OFR Analysis (2) Excluding consumer finance Q2 11 Q4 11 Q4 12 Q4 13 Q4 14 Q4 15 Q4 16 Q3 17 Q4 11 Q4 12 Q4 13 Q4 14 Q4 15 Q4 16 Q3 17 (3) Based on funded balance sheet (4) Including long-term debt <1 year (EUR 29bn) PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 8
3 OUR NEW PERSPECTIVES
PUT MORE CAPITAL AT WORK TO SUPPORT GROWTH Business revenues (1) evolution (2) Revenue growth >+3% (1) p.a. in a recovering economic o.w. Market environment activities Group >+3% EUR 25bn EUR 29bn <20% � 9 key growth initiatives 38% >+2.5% 37% � International Retail Banking and Financial Services and Global Banking and Investor Solutions as main drivers >+5.5% 30% 33% � French Retail Banking to benefit from gradual expansion of growth drivers and more favourable rate environment >+1% 32% 30% • Revenues expected to be stable in 2018 and increasing afterwards 2016 CAGR in % 2020 Increase RWAs to accompany growth... Business RWAs evolution (2) o.w. Market � Group RWAs CAGR: ~+3% activities EUR 341bn Group EUR 390bn ~+3% <20% ... while maintaining the existing balanced risk profile 40% ~+3% between businesses and geographies 40% � Retail activities to continue to account for more than 60% of 33% 34% ~+4% 2020 business RWAs and revenues � Market activities will be kept < 20% of Group RWAs 27% ~+3% 26% 2016 CAGR in % 2020 French Retail Global Banking and International Retail Banking (1) 2016 underlying figures: revenues adjusted for non economics and exceptional items Group (2) Global Transaction and Payment Services has been transferred from French retail to GBIS. Banking Investor Solutions and Financial Services It represented ~ EUR 5.8bn of RWA as of end 2016 and ~ EUR 300m revenues in 2016 PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 10
CONTINUED COST DISCIPLINE SUPPORTED BY A NEW SAVINGS PLAN 2016-2020 Group operating expenses evolution (1) (EUR bn) 17.8 CAGR: ~+1.2% 17.0 Group operating expenses to increase on average by ~+1.2% p.a between 2016 and 2020 New 2016-2020 savings plan generating ~ EUR 1.1bn of recurring savings from 2020 2016 2020 2016-2020 Group savings and investments 2020 group Cumulative Cumulative recurring savings efficiency savings STARTING FROM 2020, EUR 1.1bn OF GROUP RECURRING SAVINGS ~ EUR 1.1bn investments ~ EUR 2.0bn Transformation of the operational and French Retail Banking 0.25 distribution model ~ EUR 1.5bn (2) 0.5 International Retail Banking Increase of platforms efficiency, expense 0.30 and Financial Services discipline, automation 0.4 Global Banking and 0.3 IT process industrialisation and digitalisation 0.35 Investor Solutions 0.3 2020 2019 Corporate divisions IT transformation and reorganisation 0.20 2018 2017 (1) 2016 underlying figures are adjusted for non-economics and exceptional items (2) Including the exceptional charge related to French retail PRESENTATION TO DEBT INVESTORS DECEMBER 2017 2020 STRATEGIC AND FINANCIAL PLAN: “TRANSFORM TO GROW” 11
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