(AOF) – As of January 26, 2024, approximately 26.835 million Crédit Agricole SA shares were purchased on irrevocable instruction given to an independent investment services provider, for an overall purchase price of approximately €322.123 million euros. This irrevocable instruction therefore ended on the same date. This operation aims to offset the dilutive effect of the 2023 capital increase reserved for employees, and the shares purchased under this share buyback program will be canceled.
The impact of this operation on the core capital ratio (CET1) of Crédit Agricole SA is -8 basis points, and -5 basis points on that of the Crédit Agricole Group.
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Key points
– Listed vehicle of the mutual group of the same name, 1st French bank and 8th worldwide;
– Net banking income of €22.7 billion, generated by community banking at 65%, by specialized financial services at 12%, by large customer banking at 14% and by savings management and insurance ;
– 3-point business model – relational excellence by becoming the preferred bank for individuals, entrepreneurs and institutions, local responsibility to support digitalization and societal commitment by amplifying mutual commitment;
– Capital held 55.3% by the regional mutuals, hence a strong presence of their representatives on the board of directors (10 out of 21 members) chaired by Dominique Lefebvre, Philippe Brassac being general manager;
– Solid financial position: CET 1 ratio of 11.2%, leverage ratio of 3.6% and cash reserves of €467 billion.
Challenges
– New “Ambitions 2025” plan:
– net profit greater than €6 billion and return on tangible equity greater than 12%,
– acceleration of technological and digital transformation with €20 billion of budget for IT and digital including €1 billion for technological transformation,
– cash distribution of 50% of the result;
– Innovation strategy, one of the 3 levers of the business model:
– internally: 90% of the Group’s entities with a “data-centric” architecture in 2022, and €300 million in IT efficiency gains, 100% of IT employees trained in new technologies in the System University ‘Information and 100% of emerging technologies tested on new business services,
– towards customers: expansion of the range of leading applications (Ma banque Pro, Pro&Entreprises LCL, etc.), offer of digital and mobile checkout solutions for small/medium merchants, European electronic banking offer for large brands and complete range e -trade ;
– Environmental strategy aimed at carbon neutrality in 2050 for the own footprint and the investment and financing portfolios.
Challenges
– Integration of Italian CreVal and Lyxor;
– High impact of provisions and the increase in the cost of risk on the Ukraine and Russia zone, resulting in a 16.1% decline in net profit in the 1st half;
– Difficult market outlook for the 2nd half, excluding the United States: sharp drop in growth and rise in inflation in Europe, stagflation in emerging countries and rise in key rates.
– Share buyback programs.
Learn more about the Finance/Banking sector
Despite the turbulence, fintechs stay the course
According to BCG, in mid-2021, all listed fintechs in the world were valued on average twenty times their revenues, or a valuation of around $1.3 trillion. This figure had multiplied by more than four in three years. At the end of 2022, this multiple was divided by five, with average valuations limited to four times revenue. Nevertheless, BCG considers that the sector should record a jump in growth by 2030, with a six-fold increase in revenues for fintechs. After payments, development should mainly come from fintech banking, with the rise of turnkey services for businesses and professionals (“banking-as-a-service”).