Wednesday, March 9, 2016

Crédit Agricole is projected cautiously in 2020, building on synergies – Les Echos

Home sweet home. The refocus on domestic markets, synergies between group entities and caution are the watchwords of the new plan “Ambition Strategy 2020″ presented Wednesday by Credit Agricole. While “potential crisis is not served (…) priority is given to organic growth , insisted Philippe Brassac, CEO of Crédit Agricole SA (Casa). It is often considered a defect daring and medium, while it is actually the brand leaders, those who win market share on the other “.

The group does not rule out targeting “a few acquisitions in asset management” , but “will go not look for revenue increases in distant and unfamiliar markets “. Green bank also plans to divest non-strategic countries considered. “We have our major domestic markets in France, Italy, Germany and Poland. For the rest, Egypt, Ukraine and Morocco, rationalizations are possible if opportunities arise “, emphasized Philippe Brassac.

Customer conquest

Crédit Agricole therefore plans to conquer by himself new customers, by setting demanding goals: BforBank, its online bank, will reach the milestone of 500,000 customers in 2020, a gain of 360,000 new customers in five years. LCL will earn 180,000 residential and business customers by 2019, with the goal of having 50% of clients for large SMEs (ETI) French. The regional banks want to speed with young farmers and professionals. Finally, in Italy, Cariparma is an increase of 20% of its production of home loans.

To expand its business, the group intends to play full complementarities between its different businesses. The synergies target is thus increased to EUR 8.8 billion in 2019 (1 billion from 2015). The main lever will produce internally insurance borrowers of mortgage loans of regional banks, instead of CNP Assurances.

closing as the up 1.18%

in a complex economic environment for banks, because of sustained low rate of strong regulatory requirements and competition from new entrants, the group also places focus on a more muscular savings program. “As margins drop-and we will not return back-, costs must fall, to find profitability” says Philippe Brassac. Casa will have to achieve 900 million euros of annual cost savings by 2019, via a reduction in IT spending, mass procurement and rationalization of legal entities of the group. What to allow it and Casa aiming to end 2019 net profit up at least 20% or more compared to the results of 2015. And a return on equity “tangible” (rote) top 10% instead of 12% set in the previous plan in 2016. the head judge Credit Agricole “this attractive promise” . The market seems to agree with him: the stock closed Wednesday up 1.18%, to 9.92 euros

Véronique Chocron

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