Quarterly Financial Information - Q4 2018 - Full Year 2018


2018 Underlying ROTE of 9.7% and Increase in Group Net Income.
Adaptation of The Execution and Financial
Targets of The 2020 Strategic Plan


  • Revenues(1) up +0.6% in 2018 at EUR 25,205 million (EUR 5,927 million or -4.8% in Q4 18) due to the good performance of International Retail Banking & Financial Services, resilient French Retail Banking activities and the strong momentum in Financing & Advisory.
  • 2018 operating expenses(1): EUR 17,595 million (+2% vs. 2017); Q4 18: EUR 4,627million (+0.9% vs. Q4 17.
  • Still low cost of risk at 21 basis points in 2018, reflecting the quality of the loan portfolio.
  • 2018 Group book net income: EUR 3,864 million (+37.7% vs. 2017); Q4 18: EUR 624 million (EUR 69 million in Q4 17). Group ROTE(1) of 9.7% in 2018 (5.9% in Q4 18).
  • Continued refocusing of the business model on core regions and businesses (announced disposals representing an equivalent impact of +37 basis points on the CET1 ratio).
  • Group commitment to positive transformation initiatives recognised through further awards in 2018.
  • On the three main litigation issues, agreement reached with the US and French authorities.
  • Fully-loaded CET1 ratio: 10.9% (11.2%(2) with the effect of the option of a dividend payment in shares subject to approval by the Combined General Meeting on May 22nd, 2019).
  • 2018 Earnings Per Share: EUR 4.24 – Proposed dividend stable at EUR 2.20, with option of payment in shares.


  • Confirmation of the long-term strategic focus: a diversified, more compact Group resolutely focused on its customers, delivering profitable and responsible growth.
  • Inclusion of the new interest rate scenario in the eurozone, with an impact of around EUR -500 million on Group revenues in 2020.
  • Adaptation of the operational set-up in Global Markets resulting in a reduction in riskweighted assets of around EUR 8 billion between now and 2020.
  • Additional plan to reduce costs by around EUR 500 million in 2020 in Global Banking & Investor Solutions.
  • Acceleration in the refocusing of the regional and business portfolio taking the disposal programme target to a positive effect of +80-90 basis points on the CET1 ratio by 2020 (the Group’s initial target being 50-60 basis points).

The Group’s financial targets for 2020 are as follows:

  • Group ROTE(1) of between 9%-10%
  • RONE(1) for French Retail Banking revised to 11.5%-12.5%
  • RONE(1) for International Retail Banking & Financial Services increased to 17.0%-18.0%
  • RONE(1) for Global Banking & Investor Solutions ranging from 11.5% to 12.5%
  • CET1 ratio of 12%
  • 50% payout ratio, with a dividend per share of at least EUR 2.20

Fréderic Oudéa, the Group’s Chief Executive Officer, commented:

“After this first year in the execution of our 3-year plan, we have confirmed our long-term strategic ambition: delivering profitable and responsible growth thanks to a robust, diversified, more compact banking Group resolutely focused on its customers, in order to assist them in their positive transformation projects.

We successfully achieved several major milestones in our transformation during 2018. The digital transformation process continued with success and there was considerable progress in the growth initiatives in French and International Retail Banking, as well as Financing & Advisory. However, market activities experienced a more mixed performance, below our expectations.
In an economic, financial and regulatory environment that looks set to be less favourable and even more complex over the next few years than anticipated a year ago, we have decided to adapt the execution of our plan and our financial trajectory.

Our first priority is, and will remain, to increase value for shareholders while consolidating our capital trajectory. We will be even more selective in our capital allocation, prioritising the Group’s areas of excellence. Moreover, in a more uncertain economic environment, we will continue to work on our operating efficiency with an additional plan to reduce costs in Global Banking & Investor Solutions and we are further prioritising cost control. All these measures and the Group’s transformation will enable us to improve our operational profile and pursue the improvement in the structural profitability of our businesses.”


The footnote * in this document corresponds to data adjusted for changes in Group structure and at constant exchange rates.
(1) Underlying data. See methodology note 5 for the transition from accounting data to underlying data.
(2) Taking into account the assumption of a 50% subscription rate for the dividend in shares.


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