Understanding our Annual Results 2019

Dear shareholder,

2019 was a year of considerable progress during which we achieved all the targets, both strategic and financial, that we set ourselves.

As a result, we substantially increased our capital ratio, which stood at 12.7% at the end of 2019.  This was the priority target for 2019 in order to strengthen market confidence in our ability to absorb future regulatory impacts. In line with the commitments made, the dividend, proposed to the General Meeting on May 19th, will be EUR 2.20 per share in cash. We see this high dividend as a means of thanking our shareholders for their trust and loyalty.

Secondly, our results reflect both the healthy commercial momentum of our activities, our rigorous cost discipline and our good risk control. French Retail Banking enjoyed buoyant commercial activity throughout the year, with revenues and costs in line with our 2019 targets and resilient profitability. International Retail Banking & Financial Services confirmed its profitable growth potential in all its businesses and geographical regions. Global Banking & Investor Solutions successfully implemented its restructuring plan, above annual targets, while maintaining its franchises.

In particular, the fourth quarter was characterised by strong growth in revenues and underlying Group net income. Our underlying Group net income totalled EUR 875 million in Q4 19 and EUR 4.1 billion in 2019.

2019 saw the Group continue to strengthen its business model. We invested in our core franchises, while pursuing our refocusing plan, and continued to roll out new technologies in our businesses in order to enhance our customers’ experience. Lastly, we are, and will remain, fully committed to the sustainable development of our economies and aim to be a banking leader in the area of responsible finance. Our commitments and actions are recognised by external bodies and the annual ranking by RobecoSAM(*) for 2019 ranks us No. 1 bank globally on environmental issues.

We are therefore entering 2020 with confidence, with a more compact business model based on leadership positions in high added-value businesses and a presence in buoyant geographical regions. We intend to capitalise on the robustness of this model to pursue the expansion of our core franchises and improve our profitability, by increasing our efforts in terms of operational efficiency and disciplined cost management. We are confirming our commitment to create value for our shareholders. In 2020, we aim to increase earnings per share and tangible net asset value per share. We are adjusting our dividend policy, with the aim of distributing 50% of underlying Group net income, a figure which could include up to 10%, i.e. a fifth of the amount paid back to shareholders, in share buybacks.

More than ever, our ambitions around the use of digital technologies in order to better serve our customers and the deepening of our CSR commitment are at the centre of our strategic approach. As we have just reaffirmed in our raison d’être, we are determined to build a better and sustainable future with our customers, shareholders and employees. 

Once again, I would like to thank you for your loyalty and the trust you have placed in our Group.
 
Frédéric Oudéa,
Chief Executive Officer

(*) Every year, in conjunction with the S&P Dow Jones Indices, RobecoSAM publishes a ranking of the world's largest companies based on economic, environmental and social factors.