BNP Paribas Investor Day - April 6th, 2006 - Asset Management ...

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BNP Paribas Investor Day - April 6th, 2006 - Asset Management ...

  1. 1. AMS A growth driver for BNP Paribas Alain PAPIASSE Member of BNP Paribas’ Executive Committee Head of AMS 6 April 2006 1
  2. 2. Disclaimer Some information contained in this presentation and other information or material may include forward-looking statements based on current beliefs and expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to inherent risks, uncertainties and assumptions about BNP Paribas and its subsidiaries and investments, including developments of BNP Paribas’ business, banking industry trends, future capital expenditures and acquisitions, changes in economic conditions globally or in BNP Paribas’ principal local markets, the competitive market and regulatory factors. Those events are uncertain; their outcome may differ from current expectations which may in turn significantly affect expected results. Actual results may differ materially from those projected or implied in these forward-looking statements. Any forward-looking statement contained in this presentation speaks as of the date of this presentation: BNP Paribas undertakes no obligation to publicly revise or update any forward-looking statements in light of new information or future events. The information contained in this presentation as it relates to parties other than BNP Paribas has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on the fairness, accuracy, completeness or correctness of, the information or opinions contained herein. None of BNP Paribas or its representatives shall have any liability whatsoever in negligence or otherwise for any loss however arising from any use of this presentation or its contents or otherwise arising in connection with this presentation or any other information or material discussed. This document does not constitute or form part of any offer to sell or issue or invitation to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for, any securities of BNP Paribas or BNL, nor shall it or any part of it, nor shall the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision. This presentation is not an offer to sell or the solicitation of an offer to purchase securities in the United States. Securities may not be sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. BNP Paribas does not intend to register any offering in the United States or to conduct a public offering of securities in the United States. Figures for the year 2002 and 2003 results are based on French GAAP excluding goodwill amortisation. Figures for the year 2005 results are based on the IFRS accounting standards, as adopted by the European Union. Figures for 2004 results are a simulated restatement of the year 2004 applying the same standards. The corresponding simulated figures have not been audited. Asset Management & Services Disclaimer 2
  3. 3. Presentation overview AMS Key Figures Business Model Market Dynamics 3
  4. 4. AMS: a Major Asset for BNP Paribas l A substantial part of the Group* n 17% of NBI n 16% of pre-tax income AMS n 16% of allocated capital n Presence in over 40 countries l A major presence in the asset gathering and management business n Assets under management €430bn n Assets under custody €3,058bn n Assets under administration €520bn * Excluding BNP Paribas Capital and other activities Asset Management & Services Key Figures 4
  5. 5. Accelerated Net Asset Inflows Net Asset Inflows Assets under Management (End of period) +25% 430 34.1 343 322 295 12.7 13.6 14.2 9.9% +7% 4.0% 4.6% 4.4% +9% in €bn in €bn 2002 2003 2004 2005 2002 2003 2004 2005 % of assets managed l Net inflows more than doubled in 2005, both in volume and as a percentage of assets under management n All business lines have contributed to this performance l Assets under management : +25% in one year n 55% of this is attributable to organic growth and acquisitions and 45% to performance and foreign exchange impact Asset Management & Services Key Figures 5
  6. 6. Sharp Rise in Revenues and Results NBI Pre-tax Income CAGR 2005-2002 CAGR 2005-2002 1,266 +13.5% 3,552 +12.5% 3,044 1,059 2,616 890 857 2,428 32% 33% 29% 28% in €mn in €mn 2002 2003 2004 2005 2002 2003 2004 2005 Pre-Tax ROE l Robust and profitable growth n Revenues, 2002-2005 CAGR* +13.5% n Pre-tax income, 2002-2005 CAGR* +12.5% l Acceleration in 2005 n Revenue of €3.6bn in 2005 +16.7% / 2004 n Pre-tax income of €1.3 bn +19.5% / 2004 l High profitability n Pre-Tax ROE 33% in 2005 *Figures are restated, see appendices Asset Management & Services Key Figures 6
  7. 7. Organisation Around Six Business Lines NBI 2005 €3.6bn Real Estate Services 12% Cortal Insurance Consors 29% 7% Wealth and Asset Private Management Banking 18% Securities Services Asset 21% Management 13% Asset Management & Services Key Figures 7
  8. 8. Covering the Entire Investment Cycle Gather Manage Retail network Advisory & discretionary portfolio External distribution management Independent advisors Sophisticated solutions On-line distribution Real estate funds Multi-management Administrate Protect Custody and fund Life insurance administration Creditor insurance Employee savings plans Protection Property management Property & Casualty Asset Management & Services Business Model 8
  9. 9. High Brand Recognition and Image l A brand policy based on the BNP Paribas brand n BNP Paribas Asset Management n BNP Paribas Assurance n BNP Paribas Private Banking n BNP Paribas Real Estate n BNP Paribas Securities Services l Specialist brands to facilitate business development n Atisreal n Cardif n Cortal Consors n Specialised asset management activities: Fauchier Partners, Overlay Asset Management, FFTW, FundQuest Asset Management & Services Business Model 9
  10. 10. Businesses Leaders in their Markets #2 in mutual fund promotion in France Asset Management Leader in multi-management in Europe #1 in France Private Banking #3 in Europe #1 in France Cortal Consors #3 in Germany Leader in Europe Real Estate Services #1 in France in commercial real estate Leader in real estate services in Continental Europe Insurance #4 in life insurance in France #2 in creditor insurance worldwide #1 in France Securities Services #1 in Europe #5 worldwide Sources in appendix Asset Management & Services Business Model 10
  11. 11. A European Leader with an Extensive Global Presence Asset Management Cortal Consors Private Banking Securities Services Insurance Real Estate Services Russia Korea Japan United-States China Kuwait India Hong Kong Morocco Vietnam Mexico Bahamas Bahrain Taiwan Thailand Panama Singapore Brazil Australia Uruguay South-Africa Argentina New Zealand Chile Presence in over 40 countries Presence in over 40 countries 16,600 employees at end 2005 16,600 employees at end 2005 Asset Management & Services Business Model 11
  12. 12. Recognised Expertise in Product Development and Performance l Ability to innovate n A pioneer in open architecture and multi-management n Global leadership in individual protection thanks to a unique model of partnerships n Continuous enhancement of alternative and structured products offering l Wide product range n BNP Paribas AM offering covers all asset classes n BNP Paribas Real Estate offers a complete business mix n BNP Paribas Securities Services offering covers the whole of Europe l Award-winning performance n European Chief Investment Officer of the Year n BNP Paribas Securities Services European Fund Administrator of the Year n BNP Paribas AM Lauriers d’Or (Investir Magazine) in 2004 and 2005 Asset Management & Services Business Model 12
  13. 13. Powerful Distribution Platform Dedicated sales teams 4 customer segments Estimated contribution to 2005 NBI Corporates & Group Relationship Managers Specialised Relationship Managers Institutional clients (B to B) 35% 1,000 customers Partners (B to B to C) Dedicated sales forces 1,000 customers 15% High Net Worth Private bankers 180,000 customers 25% Specialised AMS sales forces Mass affluent backed by network sales staff 7 million customers 25% Asset Management & Services Business Model 13
  14. 14. Effective and Well Co-ordinated Product Development and Distribution l Specialised product-development teams to improve n Market response n Innovation capability n Intrinsic product performance n Quality of service l Distribution channels organised to n Increase sales teams’ efficiency n Increase customer satisfaction: advisory, diversified offering n Promote cross-selling n Increase wallet-share A business development-oriented organisation A business development-oriented organisation Asset Management & Services Business Model 14
  15. 15. Strong Business Complementarities within AMS Asset Management Multi-management Life-insurance offering Fund offering Private Life-insurance offering Banking Insurance Fund administration Multi- Real estate management Real estate funds Fund offering funds Fund administration Life-insurance offering IFA distribution Real estate investments in insurance funds Securities Cortal Services Consors Real estate Real estate funds funds Real Estate Services Revenue synergies Revenue synergies Enhanced capability to meet complex customer needs Enhanced capability to meet complex customer needs Asset Management & Services Business Model 15
  16. 16. A Powerful Engine for Cross-Selling with other BNP Paribas Businesses With International Retail With French Retail Banking and Financial Services n Cardif creditor insurance FRB n JV with Private Banking in France with Cetelem and UCB n Distribution of BNP Paribas AM n JV with Private Banking funds and BNP Paribas Insurance in the Middle East life-insurance products n Partnerships and contribution to n Real estate agencies international development AMS IRFS CIB With Corporate and Investment Banking n New private banking and corporate clients n Design of structured products for private banking and institutional clients n Custody and securities services n Real estate funds Asset Management & Services Business Model 16
  17. 17. Selective Acquisition Policy l Acquisitions of customer portfolios n Private Banking: Société Monégasque de Banque Privée and Bank von Ernst in Monaco, Caïxa and CitiGold Wealth Management in Switzerland n Cortal Consors: portfolio of customers in Belgium n Real Estate Services: Chesterton in the UK n Insurance: JPMorgan's network of IFAs in France, strategic partnership with distributor Magazine Luiza in Brazil n Securities Services: Invesco’s custody business in Germany l Expertise enhancing n Asset Management: FundQuest in the US (multi-management) and investment in Fauchier Partners in the UK (funds of hedge funds) n Real Estate Services: Atisreal in Europe (services), Studelites in France (student housing) l Geographic expansion n Asset Management: joint-venture with Sundaram Finance in India n Private Banking: Banque Nachenius and Tjeenk & Co in the Netherlands n Real Estate Services: Opera RE in Italy An additional growth driver An additional growth driver Asset Management & Services Business Model 17
  18. 18. Favourable Market Dynamics in Developed Economies... l Aging populations and deficits in public pension and health schemes n Need to increase individual and/or corporate savings for retirement purposes l Unemployment risk n Need to save "for a rainy day" l Growth of intermediate age groups with higher incomes n Considerable savings potential Asset Management & Services Market Dynamics 18
  19. 19. … and in Emerging Countries l Emergence of a middle class in many countries with fast-growing populations n New savings potential l Increasing number of high net-worth individuals n Demand for higher value-added services and products l More open and stable economies, gradual decrease in inflation and development of financial markets n Development of a broader and more sophisticated range of savings products for investors Asset Management & Services Market Dynamics 19
  20. 20. Key Points A powerful, innovative and fast-growing A powerful, innovative and fast-growing distribution platform distribution platform Strong and complementary businesses Strong and complementary businesses An objective: grow faster than the market An objective: grow faster than the market Asset Management & Services Key Points 20
  21. 21. AMS BNP Paribas Asset Management Gilles GLICENSTEIN Chairman 6 April 2006 21
  22. 22. Presentation overview BNP Paribas Asset Management Key Figures Business Model Market Dynamics Growth Perspectives 22
  23. 23. A Major Player the in Asset Management Industry Assets under Management Assets under Management and Advisory +40% +31% 274 193 141 147 196 132 160 168 In €bn In €bn 2002 2003 2004 2005 2002 2003 2004 2005 l #7 promoter in the Euro zone (Feri FundFile) l #2 promoter of French funds (Europerformance) l One of the European leaders in external distribution with Parvest, representing assets under management of €22bn Strong net asset inflows in 2005: €17bn Strong net asset inflows in 2005: €17bn BNP Paribas Asset Management Key Figures 23
  24. 24. Balanced Mix of Assets and of Client Types Breakdown of assets under management By asset class By client type Money Markets External 27 % distribution Retail & 12 % Private Equity Banking 18 % 43 % Balanced 13 % Institutional Fixed Income 45 % Structured, 28 % alternative, & index-based 14 % l Diversification by asset class l Balanced client base makes it possible to smooth out impact of market swings Figures at 31/12/2005 BNP Paribas Asset Management Key Figures 24
  25. 25. Profitable Growth NBI 473 432 398 373 l Strong growth in revenues since 2003 In €mn 2002 2003 2004 2005 Pre-tax net income and cost / income ratio +12% 250 223 l Sharp rise in profitability supported 180 180 by strict financial discipline 54 54 49 48 In €mn 2002 2003 2004 2005 Cost / income ratio (in %) BNP Paribas Asset Management Key Figures 25
  26. 26. Global Coverage Supported by an International Network Europe Paris Lisbon London Luxembourg Americas Madrid Milan Amsterdam Prague Frankfurt Vienna Asia New York Boston Geneva Tokyo Philadelphia Hong Kong Sao Paulo Mumbai /Madras Buenos Aires Seoul Montevideo Shanghai Beijing Middle East and Africa Singapore Main management Sydney centres Casablanca Taipei Bahrain Other Kuwait management/distribution centres l Streamlined production: 5 specialised management centres l Rep. offices in 26 countries ensuring local service l Significant positions outside France: 3rd-ranked foreign promoter in Spain, 4th-ranked in Italy (CNMV, Assogestioni) l More than 1,400 employees worldwide, of which half outside France BNP Paribas Asset Management Business Model 26
  27. 27. A Multi-Specialist Approach Within an Integrated Framework Multi-Management Currency Management Global Fixed Income Funds of Hedge Funds Hedge Funds Funds for IFAs and Institutional Investors BNP Paribas Asset Management Business Model 27
  28. 28. Our Response: a Pro-Active Development Strategy in Tune with Market Trends India 2005 Extension of geographic China 2003 2005 coverage FundQuest (multi-management) EasyETF (trackers, with AXA IM) 2003 Cooper Neff Advisors (single hedge funds) 2001 Taiwan Overlay Asset Management (FX) 1999 Fauchier Partners (funds of hedge funds) Argentina / Brazil / Morocco / South Korea 2000 1998 Multi-management and alternative & structured investments Singapore 1999 Germany / Hong Kong 1993 Fischer Francis Trees & Watts (Global Fixed Income) United Kingdom 1992 Australia / Japan 1989 1986 United-States 1984 Product offer enhancement BNP Paribas Asset Management Growth Perspectives 28
  29. 29. Strong Beliefs in Three Major Trends l Demand is increasingly diversified n Traditional forms of asset management are being challenged by new approaches n Specialisation is a necessity l Distribution is becoming a full-fledged business n Demand for diversification is strong but implementing it is complex n Providing services to distributors and investors is increasingly costly l Penetrating new growing regions requires local operations and global discipline n Strong local expertise is a condition for success n Achievement of synergies is based on global integration BNP Paribas Asset Management Market Dynamics 29
  30. 30. Global Asset Manager Business Model Comes into Question Polarisation of the asset management offer + Alternative Index-based and structured investment Multi- Market growth management Fundamental active management Margins + l Fundamental active management now competes with alternative investment approaches (index-based, structured, hedge funds, illiquid assets, etc.) and multi-management BNP Paribas Asset Management Market Dynamics 30
  31. 31. Production and Distribution Increasingly Decoupled Weight of external distributors in Europe as a % of assets under management Italy Germany Europe +28% 23% 18% +25% 15% 12% +75% 7% 4% 2003 2004 2003 2004 2003 2004 Source: McKinsey report, October 2005 External distribution networks External distribution networks are growing rapidly in Europe are growing rapidly in Europe BNP Paribas Asset Management Market Dynamics 31
  32. 32. An Offer Geared to High Value-Added Products (1/2) 2002 * 2005 * Structured, Structured, alternative alternative & index-based Money Markets & index-based Money Markets 14% 27% 7% 31% Equity 17% Equity 18% Fixed Income Balanced Balanced 33% Fixed Income 12% 13% 28% 27.6 Alternative, structured and index- based assets 19.4 Structured and index-based 16.0 15.0 Alternative investment 12.8 and currency overlay 9.8 10.2 * As a % of assets under 9.1 11.6 management at 31/12 0.7 4.8 6.6 In €bn 2002 2003 2004 2005 Very sharp ramp-up in alternative and structured assets Very sharp ramp-up in alternative and structured assets BNP Paribas Asset Management Growth Perspectives 32
  33. 33. An Offer Geared to High Value-Added Products (2/2) l Structured funds: continuous growth and innovation n More than 170 such funds currently, including 65 new funds in 2005 n BNP Paribas AM expertise exported abroad: 40 new funds in 2005 n Constant innovation to meet market expectations: actively managed open-ended funds, multiple underlyings, high-alpha bond funds l Index-based funds: rapid increase since entering into partnership agreement with AXA IM for the EasyETF range n Assets under management at end-February 2006: €2.75bn, x7 since early 2005 n Top 5 in Europe l Alternative investment funds: development in all segments n Funds of hedge funds with Fauchier Partners n Hedge funds with CooperNeff Advisors n Currency overlay with Overlay Asset Management BNP Paribas Asset Management Growth Perspectives 33
  34. 34. Multi-Management A Fast-Growing Market l The provision of advisory and services has become an essential factor of choice for distributors and investors Trends in distributor and investor expectations Quality of Quality of Fee retro- Fee retro- Performance Performance Advice Advice TAMP* TAMP* client service client service cessions cessions * Turn-key Asset Management Provider l Open architecture is one of the fastest-growing segments of the asset management industry n Global market estimated at $950bn in 2004 n Compound annual growth rate: 32% since 2002 BNP Paribas Asset Management Growth Perspectives 34
  35. 35. A Worldwide Leader in Multi-Management l Worldwide leader in multi-management n Assets under management and advisory: €32.7bn at 31 December 2005 l Successful integration of FundQuest (US) since acquisition in August 2005 n Two harmonised platforms, in the United States and Europe n Extension of European coverage n Staff increased to 165, including 30 portfolio managers and analysts FundQuest: a single brand name FundQuest: a single brand name BNP Paribas Asset Management Growth Perspectives 35
  36. 36. FundQuest A Complete Range of Products and Services l Universe of more than 60,000 funds worldwide Fund selection Fund selection § Quantitative screening l Access to the best fund managers and § Quantitative screening boutiques with more than 800 visits and § Qualitative analysis § Qualitative analysis interviews a year Integrated services Integrated services l Strengthening of the integrated services § § Advice and reporting Advice and reporting platform dedicated to institutional investors § Training and their advisors § Training l Retirement management solutions for independent advisors Product range Product range l Innovative fixed-income funds of funds: more than €200 million gathered two months after launch BNP Paribas Asset Management Growth Perspectives 36
  37. 37. Accelerated Development in Fast-Growing Regions Assets in Emerging Markets * 14.3 +47% 9.7 +47% 6.6 5.6 In €bn 2002 2003 2004 2005 Emerging markets development expertise Emerging markets development expertise * Entities owned directly or through partnership in South Korea, China, Brazil, Argentina, Uruguay, Morocco; India not included BNP Paribas Asset Management Growth Perspectives 37
  38. 38. BNP Paribas AM in Asia Successful Deployment l Multi-local model deployed regionally with a presence in fast-growing countries Seoul n China: SYWG-BNP Paribas AM joint venture n India: Sundaram-BNP Paribas AM joint venture Shanghai Tokyo Beijing n Hong Kong, Singapore: BNP Paribas AM, FFTW, Overlay AM Taiwan Hong Kong n South Korea: Shinhan-BNP Paribas ITMC joint venture Bombai / Madras l Organisation geared to promoting synergies within Singapore BNP Paribas and with partners n Broadening of the Parvest range: Parvest India, Parvest BRIC Equities Sydney n Development of a local offer based on the overall BNP Paribas AM expertise: Chinese equities fund in South Korea, structured funds Subsidiary Joint-venture n Increased local penetration facilitated by the presence of other BNP Paribas entities Representative office €24bn in assets €24bn in assets BNP Paribas Asset Management Growth Perspectives 38
  39. 39. Numerous Cross-Selling Opportunities With other BNP Paribas Business Lines Insurance Advisory on reserves management Management of life insurance products Securities Services Private Banking Centralised dedicated portfolio Fund management in France administration BNP International offering of Parvest and of alternative investment products Paribas AM Distribution of investment Fund selection and distribution products through networks Cortal Consors Retail Banking BNP Paribas Asset Management Growth Perspectives 39
  40. 40. Conclusion A large and profitable asset manager, benefiting from a balanced business A large and profitable asset manager, benefiting from a balanced business model and a robust organisation model and a robust organisation Comprehensive business model integrated around centres of expertise Comprehensive business model integrated around centres of expertise meeting clients’ increasingly sophisticated needs meeting clients’ increasingly sophisticated needs Development momentum in terms of products, distribution channels Development momentum in terms of products, distribution channels and entering high-potential markets and entering high-potential markets BNP Paribas Asset Management Conclusion 40
  41. 41. AMS BNP Paribas Private Banking François DEBIESSE Head of Private Banking Marie-Claire CAPOBIANCO Head of French Private Banking 6 April 2006 41
  42. 42. Presentation overview BNP Paribas Private Banking Key Figures Business Model Market Dynamics Growth Perspectives 42
  43. 43. Fast Growing Business Line l Active strategy to grow client base Client assets* 117 n Increase wallet-share n Boost sales efforts 99 n Make selective acquisitions and partnerships 95 96 +19% l Favourable market conditions in 2005 In €bn n Strong equity markets 2002 2003 2004 2005 n Steady bond markets n Favourable €/$ exchange rate 1,006 Revenues** 895 886 873 l Constant improvement in return on assets n 2005 ROA of 93 bps, up from 90 bps in 2002 +14% n Shifting client assets to higher value-added products and services In €mn 2002 2003 2004 2005 Accelerating growth momentum Accelerating growth momentum *End of period; **Including 100% of joint ventures with FRB (France and Monaco) and including B*Capital in 2002 and 2003 BNP Paribas Private Banking Key Figures 43
  44. 44. High Margins as a Result of Steady Productivity Improvements Growth and profitability in 2005 2005 gross operating margin (before head office expenses) >50% l Combination of entities and locations geared France to growth and profitability 25-50% l Optimisation of back office and IT platforms Asia/Americas/ < 25% to boost operating efficiency Europe Off-shore Europe On-shore n France: resource pooling with the retail network, <10% >10% dedicated staff and specific client filtering NBI growth 2005/2004 n International: 3 global hubs (Luxembourg, Geneva, Singapore) processing 93% of volumes Pre-tax income and cost / income ratio* through a common application 76 331 72 267 70 l Simplified structures at the major off-shore 225 67 205 centres in €mn 2002 2003 2004 2005 Pre-tax income C / I ratio (%) * Including 100% of France and Monaco BNP Paribas Private Banking Key Figures 44
  45. 45. Major Global Player Client Assets - December 2005 2006 Rankings Asia & Middle East France 13% 42% France #1 Western Europe #3 Latin America 3% Europe Asia Latin #7 America #7 Europe Off-shore On-shore 34% 8% €117bn in client assets €117bn in client assets Structured Foreign Exchange products Fixed Income DPM Operations in 26 countries Operations in 26 countries #2 Global #8 Global 3,400 employees 3,400 employees High brand awareness and recognition High brand awareness and recognition Source: Euromoney 2006 rankings BNP Paribas Private Banking Key Figures 45
  46. 46. Comprehensive and Innovative Financial Offer l Advice is at the heart of the commercial approach n Clear investment strategy with recommendations broken down by asset class Breakdown of invested assets 2005 n Offer systematically adjusted to each client segment l Open architecture without precluding privileged partnerships within the Group Life insurance Mutual Funds 23% 31% l Comprehensive and innovative offer n Sophisticated investment mandates: Absolute performance, Alternative investment, Capital protected, etc. Structured products n Structured and derivative products covering all types Fixed Income 6% of underlyings 14% n Rapid ramp-up of the alternative investment offer: funds of hedge funds, Private Equity funds, Real Equities Estate Investment funds 26% BNP Paribas Private Banking Business Model 46
  47. 47. Offer Adapted to Key Moments in the Client's "Wealth History" l Global Asset Allocation approach to win clients and build loyalty l Network of tax and estate planning specialists and fiduciary experts l Support for the key stages in investing and monetising assets l Solution centres: multidisciplinary expertise to assist private bankers in managing and developing Ultra High Net Worth clients Solution centre organisation Investment services Solution Financing n Portfolio Management centre n Investment Financing and leveraging n Securities/Fund Advisory n Real Estate Financing n Alternative Investment Private n Yacht Financing n Derivatives & Structured Products n Foreign Exchange n Capital Markets Execution Client Advisory & Wealth structuring Other services n Global Asset Allocation n Art Advisory n Tax & Estate Planning Banker n Property/Real Estate Advisory n Trust & Corporate Services n Philanthropy Services n Custody Services Specialists n Corporate Advisory n Family Governance BNP Paribas Private Banking Business Model 47
  48. 48. Fast-Growing and Attractive Market l Steadily growing €25,000 billion market l New centres of wealth l Fragmented industry l Rising barriers to entry n Increasingly sophisticated client expectations: multi-booking, loans, wealth management services n More stringent regulatory environment n High fixed costs: IT, offer, support services Critical mass, specialised approach and flexibility: Critical mass, specialised approach and flexibility: pre-requisites to fully benefit from the market’s growth potential pre-requisites to fully benefit from the market’s growth potential BNP Paribas Private Banking Market Dynamics 48
  49. 49. Three-Pronged Client Acquisition Strategy Selective Organic growth Partnerships acquisitions Recruitment of Private Bankers in Achieve economies of scale for Joint ventures with retail banking all regions existing operations and corporate and investment banking activities Organic development of new Enter new markets operations in markets with high Partnerships covering client potential origination, commercial management, product and service offer BNP Paribas Private Banking Growth Perspectives 49
  50. 50. Rapid Growth of the Commercial Organisation Number of private bankers by region (Base 100 in 2003 for the regional breakdown ) Global France Europe off-shore Europe on-shore 1,530 1,333 123 108 111 100 100 100 12/03 12/05 12/03 12/05 12/03 12/05 12/03 12/05 Americas Gulf Asia 300 177 124 100 100 100 12/03 12/05 12/03 12/05 12/03 12/05 BNP Paribas Private Banking Growth Perspectives 50
  51. 51. Strong Organic Growth for On-Shore Business Client assets - Europe on-shore* Markets with high growth potential India Brazil Mainland (since 2000) (since 2001) China 8.8 Mumbai São Paulo Hong Kong Delhi Rio de Janeiro (since 1984) Calcutta Belo Horizonte +27% p.a. Bangalore Curitiba Taiwan Puna (since 2005) Ahmedabad 4.3 Chennai Shanghai Hyderabad (planned for 2006) In €bn 2002 2005 l Strong momentum in net new cash for Europe on-shore: Southern Europe, Belgium, the Netherlands l Active development strategy for three regions outside Europe with very high growth potential: India, Brazil, Mainland China l Cross-selling potential with other business lines that have local operations: Atisreal, BNP Paribas AM, Corporate Finance * excluding France BNP Paribas Private Banking Growth Perspectives 51
  52. 52. Acquisitions in Order to Foster Growth 2002: takeover of Chase’s Private Banking business in Spain 2005: Acquisition of Nachenius, Tjeenk & Co. in the Netherlands Total client assets acquired * > €5bn 2003: Takeover of BEAL (WestLB group) clients in Luxembourg 2004: Acquisition of Société Monégasque de Banque Privée and Bank von Ernst (Monaco) 2005: Integration of Citigold Switzerland and Caixabank Banque Privée (Switzerland) 2004: Integration of the Private Banking business of Sudameris in Miami 2006: Takeover of Bank of America’s non-resident clients in the US Economies of scale at existing sites Economies of scale at existing sites Penetration of new markets Penetration of new markets * Including the Bank of America deal, signed in 2006 and which will close in the second half of this year BNP Paribas Private Banking Growth Perspectives 52
  53. 53. Innovative and Efficient Internal Joint Ventures French Retail Network French Private Banking - Private Banking Monaco • Joint venture since 2001 in France and since 2003 in Monaco • Highly recognised Business model: #1 in France and #1 in Monaco (Euromoney 2006) Private Banking Premium Group Hong Kong • Joint venture since 2002 for the Private Banking Middle East Hong Kong tycoon market • Joint venture since 2005 in the Gulf • 38% penetration rate in the region targeted clientele segment • Promising initial results CIB IRFS Pragmatic approach Pragmatic approach Potential for internal and external replication Potential for internal and external replication BNP Paribas Private Banking Growth Perspectives 53
  54. 54. French Private Banking Powerful Organisation based on an Innovative Model French Private Banking organisation l Alignment of interests with the retail network French Private Banking Network n P&L shared between the retail network and AMS Regional n Organisation mirroring the network’s Head Office & Regional Private Divisions structure Very / Ultra HNW teams Banking Teams n Client synergies at the heart of organisational culture and sales Region-based Private Banking Groups promotion Wealth Management centres of Branches Advisors l Strong differentiation in the client Advisors specialised Client relationship to guarantee satisfaction by client line Lines and loyalty l Segmentation according Executives & Business Owners to medium-term potential Market Share French Private Relationship with l Dedicated staff for Very High Banking clients BNP Paribas and Ultra High Net Worth clients Shareholders in the Top 700 French companies 24% 32% CAC 40 companies Executive Committee 14% 40% members BNP Paribas Private Banking Growth Perspectives 54
  55. 55. French Private Banking A Commercial and Financial Success Network Potential l Sustained business growth Annual target – New business relationships n Network potential regularly renewed enabling steady new client flow Private individuals 6,000 n Increasing ability to win outside clients Professionals 2,000 n Substantial synergies with other Group business lines Entrepreneurs 700 n 10,000 new business relationships a year Companies 500 and constant growth in assets assigned per household Average client assets – 2005 l Recurrent revenues n Significant proportion of mutual funds and life Life insurance Securities insurance 39% 23% n High proportion of discretionary mandates l Cost base optimised through the use of the network’s IT and back office operations Cash 11% Mutual funds 27% BNP Paribas Private Banking Growth Perspectives 55
  56. 56. Private Banking Middle East Unique Joint Venture Model with IRFS in the Gulf l Region with high growth potential l Leverage BNP Paribas’ strengths in the London region Luxembourg n Significant local operations Paris n Very positive brand image Switzerland l Overall approach to client needs n Domestic and international asset management n Access to the Private Banking centres of expertise (offer, solution centres) Kuwait n Development of a range of local products Qatar Dubai l Innovative business model enabling faster Saudi Arabia Bahrain Abu Dhabi growth n Local presence guarantees close client monitoring n Operations set up at minimal cost n Cross-selling with other business lines BNP Paribas Private Banking Growth Perspectives 56
  57. 57. Significant Competitive Advantages for the Future l Leader with high brand awareness and strong presence in high potential markets l Ongoing adaptation of the offer to changes in client expectations l Robust, replicable partnership models l Operating efficiency as a way to continuously improve margins An attractive combination of profitability and growth An attractive combination of profitability and growth BNP Paribas Private Banking Conclusion 57
  58. 58. AMS BNP Paribas Real Estate Philippe ZIVKOVIC Chairman 6 April 2006 58
  59. 59. Presentation overview BNP Paribas Real Estate Key Figures Business Model Market Dynamics Growth Perspectives 59
  60. 60. Unique Business Model l Complete range of Real Estate services n Combining formerly separate businesses to function as a real estate producer, distributor and asset manager l Integration of Banking business and Real Estate services n The #1 real estate services business among Continental European banks – a source of synergies l Unique combination n A major competitive advantage for establishing relationships with new clients and fostering customer loyalty BNP Paribas Real Estate Key Figures 60
  61. 61. Rapid Growth in Services NBI Pre-tax income 434 Pre-tax ROE 111 319 92 141% 60 60 110% 136 140 Of which 250 Atisreal 64% 165 45% In €mn 2002 2003 2004 2005 2002 2003 2004 2005 Pre-tax income (in €mn) Pre-tax ROE (%) l Acquisition of Atisreal in 2004 n Switch in business mix : now ¾ services - ¼ property development n Recurring revenues n Less capital intensive than property development BNP Paribas Real Estate Key Figures 61
  62. 62. Four Complementary Business Lines Real Estate Asset Management Transactions and Advisory Property Development Property Management l Significant revenue synergies l Unique market positioning as a producer, distributor and asset manager BNP Paribas Real Estate Business Model 62
  63. 63. Services for all Economic Players Transactions Property Property Asset and Advisory Management Development Management Large corporations ü ü ü SME ü ü Institutional investors and real estate funds ü ü ü ü Public sector ü ü ü Individual customers ü ü ü ü Property developers ü ü BNP Paribas Real Estate Business Model 63
  64. 64. Highly Complementary Real Estate Business Lines l Development of the Property management activity through the Atisreal network in France l Creation of investment funds that purchase buildings n Built by Meunier n Managed by Comadim or Gérer n Commercialised by Atisreal n Launch of a second Euro Zone / United Kingdom investment fund, sourced by Atisreal BNP Paribas Real Estate Business Model 64
  65. 65. Integrated European Network Property management l 2,500 employees in 7 European Transaction - Advisory countries Real estate asset management Commercial real estate development l In-depth knowledge of each Residential real estate market to assist clients as they development internationalise their property strategies l Alliances in North America and Asia through Atisreal BNP Paribas Real Estate Business Model 65
  66. 66. Leading Positions l Transactions and advisory services n #1 in commercial real estate advisory services in Continental Europe n #1 in France (transactions and valuations) 4.8 million sq. m. placed in 2005 n #1 in Germany 22,000 valuations carried out in 2005 n #1 in Luxembourg n Among the top 10 in the United Kingdom 13 million sq. m. of commercial l Property management property managed in Europe n #1 in commercial Property management in France 26,500 residential units managed in France n #3 in serviced residential property management in France 115,000 sq. m. and 1,800 residential l Property development units started per year n #3 in France €4.5 billion in assets under l Real estate asset management management in Europe n #3 in France in managing real estate investment funds (SCPI) Sources: Estates gazette, Rankings of developers - Innovapresse, IEIF BNP Paribas Real Estate Business Model 66
  67. 67. Balanced Business Model Real estate services Revenue breakdown – 2005 l Leading business line: Transactions Property Management Property l Development of other services with 15% Development recurring fees Asset 25% n Property management Management n Asset management 5% n Advisory Property development Advisory and Transactions valuations 40% 15% l Commercial real estate: pre-placement of almost the entire production prior to the start of construction 2/3 in France 2/3 in France l Residential properties: balance between the 1/3 in the rest of Europe 1/3 in the rest of Europe greater Paris region and the other regions in France 80% in commercial real estate 80% in commercial real estate 20% in residential properties 20% in residential properties BNP Paribas Real Estate Business Model 67
  68. 68. Commercial Real Estate, a Buoyant Market Take-up in Europe 2,165,000 l Dynamic activity: the greater Paris region ranks #1 among major European cities in terms of take-up in 2005 985,000 665,000 609,000 586,000 530,000 464,000 413,000 in m² Paris - IDF London Madrid Brussels Munich Frankfurt Berlin Barcelona Vacancy rates in Europe 2005 15.2 2004 l Low inventories and vacancy 13.4 rates in the greater Paris 12.3 11.1 10.3 10.1 region 9.2 8.4 9.6 8.3 6.3 5.8 in % Francfurt Brussels Madrid London Berlin IDF Source: Atisreal BNP Paribas Real Estate Market Dynamics 68
  69. 69. New Residential Properties in France, a Healthy Market Number of new residential units purchased 121,500 112,200 101,500 103,225 l Another record year in 2005: 80,167 85,431 75,183 121,500 new residential units sold 1999 2000 2001 2002 2003 2004 2005 Properties currently on the market l Low level of stock on the market, 52,318 52,022 48,109 52,886 47,377 equivalent to only five months of 39,919 37,452 sales, while three years are required to complete a development project 1999 2000 2001 2002 2003 2004 2005 Source: Ministère de l'Equipement and developers association (FNPC) BNP Paribas Real Estate Market Dynamics 69
  70. 70. Numerous Cross-Selling Opportunities within BNP Paribas Insurance Corporate and Partner in the EP1 fund Private Banking Investment Banking Financing of the Euro Zone Distribution of real estate investment fund funds (including those under the Robien BNP act), investment in serviced residential properties and packaged products Paribas Immobilier Construction / renovation of office buildings Cross-selling with Atisreal (Meunier), property management (Comadim), Espaces Immobiliers marketing (Atisreal) French Retail BNP Paribas office Banking properties BNP Paribas Real Estate Growth Perspectives 70
  71. 71. Significant Growth Potential l Expand geographic coverage n Advisory services: grow the business in France and Germany n Property management: implement a single European brand name n Property development in France: pursue growth outside of the Paris region, including for commercial real estate n Property development outside of France: enter the Spanish and German commercial real estate markets, and develop the Italian market together with BNL l Continue selective acquisitions n In the transactions business: in the United Kingdom, Spain and Italy n In the Property management business in Europe l Broaden asset management offering n Develop the Euro Zone / UK investment fund and the property mutual funds (OPCI) BNP Paribas Real Estate Growth Perspectives 71
  72. 72. Conclusion l Real estate markets on a positive trend l A European network l A range of four complementary real estate business lines l Synergies with AMS and the Group’s other business lines Competitive advantages for meeting the real estate needs Competitive advantages for meeting the real estate needs of a wide range of clients and for developing cross-selling of a wide range of clients and for developing cross-selling BNP Paribas Real Estate Conclusion 72
  73. 73. AMS BNP Paribas Securities Services Jacques-Philippe MARSON Chief Executive Officer 6 April 2006 73
  74. 74. Presentation overview BNP Paribas Securities Services Key Figures Business Model Market Dynamics Growth Perspectives 74
  75. 75. Strong Growth and High Profitability NBI 725 Pre-Tax Income 600 609 162 * 545 145 125 106 in €mn in €mn 2002 2003 2004 2005 2002 2003 2004 2005 l Strong revenue growth +19% / 2004 l Increasing pre-tax income +16% / 2004 l High pre-tax return on equity 31% in 2005 A core growth driver for the Group A core growth driver for the Group * Excluding capital gain on Clearstream share disposal BNP Paribas Securities Services Key Figures 75
  76. 76. Sustained Business Growth Assets under Custody Number of Transactions* Assets under Administration 3 058 27 520 26 2 473 25 2 090 23 1 811 299 220 235 in €bn in mn in €bn 2002 2003 2004 2005 2002 2003 2004 2005 2002 2003 2004 2005 l Sharp increase in assets under custody +24% / 2004 l Increase in number of transactions +16% / 2004 l Very steep rise in assets under administration +74% / 2004 A strong growth acceleration in 2005 A strong growth acceleration in 2005 * 2003 - 2004: impact of netting in Germany and Switzerland BNP Paribas Securities Services Key Figures 76
  77. 77. Leader in Europe and one of the Largest Players in the World European Custodians 3,058 2,493 2,365 1,931 1,547 1,667 in €bn CACEIS RBC-Dexia SG+Unicredit UBS HSBC BNP Paribas l #5 worldwide in terms of assets under custody (Globalcustody ) l #4 worldwide in terms of cross-border assets under custody (Institutional Investors) l Only European player covering the whole securities value chain l High percentage of cross-border assets: over 70% Source: company data BNP Paribas Securities Services Key Figures 77

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