Ratings are assigned following 6 June 2018 update to Moody's Banks rating methodology
London, 22 June 2018 -- Moody's Investors Service today assigned Counterparty Risk Ratings
to 12 French banks and banking groups: Agence France Locale (AFL),
Banque PSA Finance (BPF), BNP PARIBAS Personal Finance (BNPP PF),
Groupe BPCE (BPCE), Caisse Centrale du Credit Immobilier de France
(3CIF), Groupe Credit Agricole (Credit Agricole), Groupe Credit
Mutuel, Dexia Group (Dexia), PSA Banque France, RCI
Banque, SFIL and Socram Banque (Socram).
Moody's Counterparty Risk Ratings (CRRs) are opinions of the ability
of entities to honor the uncollateralized portion of non-debt counterparty
financial liabilities (CRR liabilities) and also reflect the expected
financial losses in the event such liabilities are not honored.
CRR liabilities typically relate to transactions with unrelated parties.
Examples of CRR liabilities include the uncollateralized portion of payables
arising from derivatives transactions and the uncollateralized portion
of liabilities under sale and repurchase agreements. CRRs are not
applicable to funding commitments or other obligations associated with
covered bonds, letters of credit, guarantees, servicer
and trustee obligations, and other similar obligations that arise
from a bank performing its essential operating functions.
RATINGS RATIONALE
In assigning CRRs to 10 banks and banking groups, out of the 12
subject to this rating action, Moody's starts with the banks' adjusted
Baseline Credit Assessments (BCAs) and uses the agency's existing advanced
Loss Given Failure (LGF) approach that takes into account the level of
subordination to CRR liabilities in the bank's balance sheet, and
assumes a nominal volume of such liabilities. In addition,
where applicable, Moody's has incorporated the likelihood of government
support for CRR liabilities.
As a result, of the CRRs assigned to these 10 banks and banking
groups, the CRRs of five institutions (BNPP PF, BPCE,
Credit Agricole, Groupe Credit Mutuel, SFIL) are four notches
higher than their respective Adjusted BCAs and the CRRs of five banks
(AFL, BPF, PSA Banque France, RCI Banque, Socram)
are positioned three notches higher.
Although most if not all of the 10 banks and banking groups whose CRRs
receive four or three notches of uplift from their adjusted BCAs are likely
to have more than a nominal volume of CRR liabilities at failure,
this has no impact on the ratings because the significant level of subordination
below the CRR liabilities at each of the 10 banks already provides the
maximum amount of uplift under Moody's rating methodology (i.e.
three notches).
In all cases the CRRs assigned are equal to, or higher than,
the rated banks' senior debt and deposit ratings. This reflects
Moody's view that secured counterparties to banks typically benefit from
greater protections under insolvency laws and bank resolution regimes
than do senior unsecured creditors, and that this benefit is likely
to extend to the unsecured portion of such secured transactions in most
bank resolution regimes. Moody's believes that in many cases
regulators will use their discretion to allow a bank in resolution to
continue to honor its CRR liabilities or to transfer those liabilities
to another party who will honor them, in part because of the greater
complexity of bailing in obligations that fluctuate with market prices,
and also because the regulator will typically seek to preserve much of
the bank's operations as a going concern in order to maximize the
value of the bank in resolution, stabilize the bank quickly,
and avoid contagion within the banking system. CRR liabilities
at these banks therefore benefit from the subordination provided by more
junior liabilities, with the extent of the uplift of the CRR from
the adjusted BCA depending on the amount of subordination.
In assigning CRRs to two additional banks (Dexia and 3CIF), Moody's
starts with the adjusted BCA and uses the agency's existing basic
LGF approach. Both banks have been placed in run-off in
accordance with resolution plans approved by the European Commission in
December 2012 and November 2013, respectively. Moody's
considers that any additional support needed from public authorities would
not necessarily result in a resolution under the EU Bank Recovery and
Resolution Directive (BRRD). Therefore, Moody's considers
that these banks are in practice out of the scope of the EU's Operational
Resolution Regime and, hence, the advanced LGF approach is
not applied. Moreover, the CRRs are positioned at the same
level of these banks' respective deposits and senior unsecured ratings
as Moody's considers that the CRR obligations of these entities,
already in resolution, are unlikely to benefit from any additional
protection compared to depositors and senior creditors.
The following ratings were assigned:
Issuer: Agence France Locale
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Edel SNC
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Federative du Credit Mutuel
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa2
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Monetaire et Financiere
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Palatine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Alsace Lorraine Champagne
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Aquitaine Centre Atlantique
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Atlantique
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Bourgogne Franche-Comte
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire de la Cote d'Azur
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire de l'Ouest
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire des Alpes
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire du Massif Central
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire du Nord
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Occitane
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Rives de Paris
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque Populaire Val de France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Banque PSA Finance
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-2
Issuer: BNP PARIBAS Personal Finance
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: BPCE
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: BRED-Banque Populaire
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Caisse Centrale du Credit Immobilier de France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Baa2
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-2
Issuer: CASDEN - Banque Populaire
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Alsace Vosges
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Atlantique Vendee
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Brie Picardie
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Centre Loire
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Centre-Est
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Charente Maritime Deux Sevres
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Charente Perigord
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM d'Alpes-Provence
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM d'Aquitaine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Centre France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Champagne-Bourgogne
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de la Guadeloupe
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de la Martinique-Guyane
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de la Reunion
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de l'Anjou et du Maine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Lorraine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Normandie
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Paris et d'Ile-de-France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM de Touraine et du Poitou
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM des Cotes-d'Armor
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM des Savoie
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM d'Ille et Vilaine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM du Centre-Ouest
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM du Finistere
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM du Languedoc
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM du Morbihan
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM du Nord Est
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Franche-Comte
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Loire - Haute-Loire
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Nord de France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Nord Midi-Pyrenees
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Normandie-Seine
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Provence Cote d'Azur
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Pyrenees-Gascogne
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Sud-Mediterranee
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Sud-Rhone-Alpes
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Toulouse 31
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: CRCAM Val de France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Agricole CIB, New York Branch
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Agricole CIB, Tokyo Branch
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Agricole Corporate and Investment Bank
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Agricole S.A.
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Agricole S.A., London Branch
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Cooperatif
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Foncier de France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Industriel et Commercial
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa2
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Credit Mutuel Arkea
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa2; placed on review
for downgrade
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Dexia Crediop S.p.A.
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Baa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-3
Issuer: Dexia Credit Local
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Baa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-3
Issuer: Dexia Credit Local, New York Branch
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Baa3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-3
Issuer: Natixis
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Natixis, New York Branch
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: PSA Banque France
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-2
Issuer: RCI Banque
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A3
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-2
Issuer: SFIL
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned Aa2
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
Issuer: Socram Banque
..Assignments:
....Long-term Counterparty Risk Rating
(Local and Foreign Currency), assigned A1
....Short-term Counterparty Risk Rating
(Local and Foreign Currency), assigned P-1
WHAT COULD CHANGE THE RATING UP/DOWN
Agence France Locale
AFL's CRR could be upgraded if the government of France's
(Aa2 positive) rating were upgraded. Moody's assumes a high
probability of government support for the CRR, but owing to the
proximity between the current sovereign rating and the CRR prior to government
support, this support does not currently result in any uplift.
Although unlikely over the outlook horizon, the CRR could also be
upgraded if the bank's adjusted BCA were upgraded should AFL develop
a stable franchise, increase its market share, generate sustainable
profits and accumulate capital that will support its growth.
AFL's CRR could be downgraded if its adjusted BCA were downgraded
as a result of evidence that its business model's viability is challenged.
This could arise if the bank were unable to (1) increase its membership
and build up a loan portfolio that would enable AFL to break-even
by 2022; (2) raise funding at a cost that would allow it to originate
competitive loans; or (3) follow the credit and funding policies
initially contemplated. A significant deterioration in asset quality
or operating deficiency, or a deterioration in France' macro profile
(currently 'Strong +') could also trigger a downgrade
of AFL's adjusted BCA.
Banque PSA Finance
BPF's CRR could be upgraded if its adjusted BCA of baa3 were upgraded.
To the extent BPF's current adjusted BCA is constrained by the adjusted
BCA of its subsidiary PSA Banque France (PSA BF, LT deposits
Baa1
stable, LT senior unsecured
Baa1 stable, adjusted BCA baa3,
BCA ba1), the bank's BCA would be upgraded if PSA BF's
adjusted BCA were upgraded.
BPF's CRR could be downgraded if its adjusted BCA were downgraded.
A downgrade of its adjusted BCA could be triggered by a downgrade of PSA
BF's adjusted BCA or if the credit quality of its other operating
subsidiaries were to deteriorate materially. The adjusted BCA could
also be downgraded if BPF moved a substantial amount of capital to its
parent or if it significantly increased its investments in the operating
subsidiaries without raising its capital base and by relying on wholesale
funding instead (double leverage).
BPF's CRR could also be downgraded if the excess capital available
for BPF's own lending activities (after netting of its equity stakes
in the operating JVs) were to materially reduce.
BNP PARIBAS Personal Finance
BNPP PF's CRR is aligned with the CRR of BNP Paribas (BNPP, LT deposits
Aa3 stable, LT senior unsecured Aa3 stable, BCA baa1) because
of (1) its strategic position as BNPP's operating arm for its consumer
finance activities; (2) BNPP's track-record of capital injection
into the company whenever it was necessary; (3) BNPP's large exposure
to the company through the provision of the bulk of its funding in the
form of long-term interbank loans; and (4) Moody's expectation
that BNPP PF, as a closely-related bank affiliate incorporated
in France, will be included in the resolution perimeter of BNPP.
BNPP PF's CRR therefore moves in sync with that of BNPP.
Groupe BPCE (BPCE, Natixis, Credit Foncier de France,
Banque Palatine, and the affiliated entities of Banque Populaire)
BPCE and group rated entities' CRRs could be upgraded if BPCE's
adjusted BCA of baa2 were upgraded. This could result from a reduction
in the group's cost structure leading to improved profitability or an
increase of its Common Equity Tier 1 capital, while maintaining
a low risk profile.
BPCE and group rated entities' CRRs could also be downgraded if
BPCE's adjusted BCA of baa2 were downgraded. BPCE's adjusted
BCA could be downgraded as a result of an unexpected erosion of the group's
profitability or a sudden increase in its asset risk.
PSA Banque France
PSA Banque France's CRR could be upgraded if its adjusted BCA of baa3
were upgraded. The bank's adjusted BCA could be upgraded
(1) following a proven track record of sound and efficient governance;
or (2) as a result of a material improvement in the bank's asset quality
or solvency.
PSA Banque France's CRR could be downgraded if its adjusted BCA
were downgraded as a result of a significant increase in its loan-loss
charges, which would affect its profitability and solvency.
Owing to the bank's close links with Peugeot S.A.'s
(Ba1 stable) credit strength, a downgrade of Peugeot S.A.'s
rating could lead to a downgrade of the bank's adjusted BCA.
RCI Banque
RCI Banque's CRR could be upgraded if its adjusted BCA of baa3 were
upgraded. Given the assumption of a high probability of affiliate
support, RCI Banque's adjusted BCA could be upgraded following an
upgrade of its parent, Renault S.A. (Baa3 positive).
RCI Banque's adjusted BCA could also be upgraded following (1) a material
reduction in the bank's reliance on wholesale funding; or (2)
a material improvement in asset quality or solvency.
A downgrade of RCI Banque's CRR could materialize if its adjusted BCA
is downgraded as a result of (1) a downgrade by more than one notch of
its parent's rating, which is unlikely, given the positive
outlook; or (2) a deterioration of the bank's credit fundamentals.
Socram Banque
Socram's CRR could be upgraded if its adjusted BCA of baa1 were
upgraded as a result of an upgrade of the ratings of its main shareholders.
An upgrade of its baa3 BCA is unlikely owing to its limited franchise
and dependence on its shareholders.
Socram's CRR could be downgraded in the event of a downgrade of its adjusted
BCA as a result of (1) a downgrade of its main shareholders' ratings;
(2) a reduced probability of support from its shareholders; or (3)
a significant deterioration in the bank's funding profile, asset
quality or solvency. The CRR could also be downgraded if there
were a reduction in subordination resulting in higher loss-given-failure
for CRR obligations.
Caisse Centrale du Credit Immobilier de France
3CIF's CRR is unlikely to be upgraded given its run-off status.
3CIF's CRR could be downgraded if its adjusted BCA of ba2 were downgraded.
3CIF's adjusted BCA could be downgraded if (1) Moody's considered
that the current guarantee is insufficient to cover the bank's funding
needs; or (2) asset performance were worse than expected, resulting
in a significant decline in capital, which would not be addressed
by the guarantee fee deferral mechanism. 3CIF's CRR could
also be downgraded in the case of a decrease in the probability of government
support.
Groupe Credit Agricole (Credit Agricole S.A. - CASA,
Credit Agricole Corporate and Investment Bank - CACIB, Caisses
Regionales du Credit Agricole Mutuel - CRCAM)
An upgrade of the CRRs of CASA, CACIB and the CRCAMs would likely
follow an upgrade of CASA's adjusted BCA of baa1, which could
result from (1) a longer track record of stable and sustainable profit,
together with a low risk profile; and (2) Groupe Credit Agricole's
capital metrics were to improve significantly, above the objectives
currently set by the bank.
Conversely, a downgrade of CASA's adjusted BCA would likely
trigger a downgrade of the CRRs of CASA, CACIB and the CRCAMs.
A downgrade of CASA's adjusted BCA could occur following (1) a significant
deterioration in its asset quality, driven, for instance,
by impairments in the CIB franchise; (2) a greater-than-expected
erosion of revenue, linked to declining net interest margins;
or (3) negative developments in its capital or liquidity.
Groupe Credit Mutuel -- CM11 (Banque Federative du Credit Mutuel
- BFCM, Credit Industriel et Commercial - CIC)
BFCM and CIC's CRRs could be upgraded if their adjusted BCAs were
upgraded as a result of more positive trends in net interest margins,
which is unlikely over the outlook horizon.
BFCM and CIC's CRR could be downgraded if their adjusted BCAs of
a3 were downgraded in the event of (1) a material weakening in Groupe
Credit Mutuel's underlying profitability, chiefly as a result of
asset quality deterioration or a structural increase in the cost of funding;
(2) a weakening liquidity position or funding profile of the group;
(3) an unexpected weakening of the group's' fundamentals prompted
by the potential split between Credit Mutuel Arkea (LT deposit Aa3 ratings
under review, LT senior unsecured Aa3 ratings under review,
BCA baa1) and the rest of Groupe Credit Mutuel; or (4) a material
weakening in the operating environment in France.
Credit Mutuel Arkea (CMA)
CMA's CRR is on review for downgrade due to the increased risk of
CMA leaving Groupe Credit Mutuel. An upgrade is therefore unlikely.
CMA's CRR could be downgraded through the removal of the one-notch
affiliate-backed support from Groupe Credit Mutuel if it were to
leave the group. As a smaller standalone entity, CMA's
CRR obligations are also less likely to benefit from potential government
support than is currently the case as part of the much larger and systemically
important Groupe Credit Mutuel. Moody's may consider the
probability of government support to an independent CMA to be "low",
which could result in no uplift for the CRR.
Dexia Group (Dexia Credit Local - DCL, Dexia Crediop S.p.A.)
DCL and Dexia Crediop's CRRs could be upgraded if DCL's BCA
and adjusted BCA of b2 were upgraded. This could result from the
bank performing better than expected in the implementation of the orderly
resolution plan.
Conversely, significant deviations from the trend set out in the
resolution plan could trigger a downgrade of DCL's BCA, which,
in turn, could lead to a downgrade of DCL and Dexia Crediop's
CRRs.
Evidence from the banks' guarantor States and/or national or European
resolution authorities that additional government support would not be
provided, or under conditions detrimental to investors, could
also likely result in a downgrade of the banks' CRRs.
SFIL
SFIL's CRR could be upgraded as a result of an upgrade of the government
of France, its major shareholder.
SFIL's CRR could be downgraded as a result of a downgrade of its BCA of
a3. This could result from (1) worse-than-expected
asset performance, (2) weakening capitalization, (3) lower-than-expected
profitability, (4) deteriorating funding and liquidity profiles,
or (5) a material worsening of France's Macro Profile. SFIL's
CRR could also be downgraded in the case of a decrease in the probability
of government support.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Banks published in
June 2018. Please see the Rating Methodologies page on www.moodys.com
for a copy of this methodology.
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the credit rating action on the support provider and in relation to
each particular credit rating action for securities that derive their
credit ratings from the support provider's credit rating.
For provisional ratings, this announcement provides certain regulatory
disclosures in relation to the provisional rating assigned, and
in relation to a definitive rating that may be assigned subsequent to
the final issuance of the debt, in each case where the transaction
structure and terms have not changed prior to the assignment of the definitive
rating in a manner that would have affected the rating. For further
information please see the ratings tab on the issuer/entity page for the
respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Items color coded in purple in this Press Release relate to unsolicited
ratings for a rated entity which is non-participating.
The below contact information is provided for information purposes only.
Please see the ratings tab of the issuer page at www.moodys.com,
for each of the ratings covered, Moody's disclosures on the
lead rating analyst and the Moody's legal entity that has issued
the ratings.
The relevant office for each credit rating is identified in "Debt/deal
box" on the Ratings tab in the Debt/Deal List section of each issuer/entity
page of the website.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Guillaume Lucien-Baugas
Vice President - Senior Analyst
Financial Institutions Group
Moody's France SAS
96 Boulevard Haussmann
Paris 75008
France
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Nicholas Hill
MD - Banking
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
Releasing Office:
Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
Client Service: 44 20 7772 5454
