Gruppo Bancario Credito Valtellinese

Nov 10, 2022

CREDIT AGRICOLE SA       1.5 million new customers 9M-22 Strong corporate loans (+15.4% Q3), consumer finance (+12.6%), leasing (+15.5%) production, home loans production (-3.1% vs market -27%). Strong activity in AG and LC: MLT active management (€1.1bn inflows ex. JV at Amundi), property and casualty insurance (turnover +6.7%1 Q3/Q3), personal protection (+7.4%1 Q3/Q3), and financing activities CACIB (revenues +12.6% Q3/Q3, +4.4% at constant FX)   EXCELLENT OPERATING EFFICIENCY Cost/income ratio2 9M-22 58.1%; below MTP target, 5pp lower than the average for 10 European banks over the past 5 years   UNDERLYING INCOME +20.6% vs. pre-crisis level 9M-2019 Cost of risk +35.5% Q3 vs a very low Q3-21, back to the 2019 quarterly average. Underlying 9M-22 RoTE 12.5%3, > 2.5 pp above average of 10 large European banks         CACEIS: would become #1 in Europe in AuA and #2 in AuC, after the acquisition of RBC’s European investor services business. CONTINUED ROLL-OUT OF THE MEDIUM-TERM PLAN Roll-out of sustainability mobility offers (lease purchase agreements from €100/month in France), ahead of the exclusive long-term leasing partnership with Stellantis, coming into force on the 1st half of the year 2023 Commitment to society: Moody’s ESG solutions 67/100/A1+, top 3/68 global banks; ISS-ESG: C+/Prime. Crédit Agricole S.A. climate workshop on 6 December 2022 At the meeting of the Board of Directors of Crédit Agricole S.A. on 9 November 2022, SAS Rue La Boétie informed the company of its intention to purchase Crédit Agricole S.A. shares on the market for a maximum amount of one billion euros with no intention to increase its stake beyond 65% of the share capital of Crédit Agricole S.A. Details of the transaction are provided in a press release issued today by SAS Rue La Boétie. Dominique Lefebvre,   “Our strong commercial momentum bolsters our high levels of profitability, solidity and operational efficiency, among the best in Europe. Key assets that allow us to roll-out our MTP and amplify our support to customers and society”. This press release comments on the results of Crédit Agricole S.A. and those of Crédit Agricole Group, which comprises the Crédit Agricole S.A. entities and the Crédit Agricole Regional Banks, which own 56.8% of Crédit Agricole S.A. Please see p.31 onwards of this press release for details of specific items, which are restated in the various indicators to calculate underlying income. Crédit Agricole Group Group activity The Group saw strong commercial activity over the quarter across all business lines thanks to our customer focused banking model. Gross customer capture has been strong. In third quarter 2022, the Group recorded +460,000 new customers in retail banking, and the customer base continued to grow (+105,000 customers). Over the first nine months of 2022, the Group recorded +1.5 million new retail banking customers and the customer base grew also (+342,000 customers). Production also showed solid growth in the third quarter of 2022, with a 3.0% rise in loan origination at the Regional Banks and LCL (of which +15.4% for professional and corporate loans, -3.1% for home loans in a declining market4 and -1.5% for consumer finance), a +13.0% increase in consumer finance (CACF, managed outstandings) & leasing originations (CALEF), and +6.7% growth in property and casualty insurance premium income compared to the third quarter of 2021. Last, the insurance equipment rate5 was at a high level in the retail banking networks at end September 2022, at 27.1% for LCL, 20.6% for CA Italia, 16.1% including Creval, and 42.6% in the Regional Banks. Each of the Group’s business lines posted very strong levels of activity (see Infra). Group results In the third quarter of 2022, Crédit Agricole Group’s stated net income Group share came to €2,004 million, down -9.8% compared to the third quarter of 2021. Specific items in third quarter 2022 had a net positive effect of +€79 million on net income Group share, of which +€101 million related to the gain on disposal of La Médicale and -€21 million for the exceptional provision for moratoria in Poland (-€17 million in net income Group share), the recurring volatile accounting items, such as the DVA (Debt Value Adjustment, i.e. gains and losses on financial instruments related to changes in the Group’s issuer spread) amounting to +€10 million in net income Group share, and hedges on the Large customers loan book for -€10.4 million in net income Group share. In addition to these items, Lyxor integration costs amounted to -€4 million in net income Group share. The specific items recorded in third quarter 2021 included recurring volatile accounting items in revenues, such as the DVA (Debt Valuation Adjustment, i.e. gains and losses on financial instruments related to changes in the Group’s issuer spread) amounting to +€3 million in net income Group share and hedges on the Large customers loan book for -€4 million in net income Group share. The other factors to be added to these recurring items are presented below: the reclassification of the Serbian assets as held for sale (revenue impact of -€2 million, expenses of -€1 million, net income from assets held for sale impact of -€1 million, i.e. a total impact on net income Group share of -€4 million), Creval integration costs (-€9 million in operating expenses, -€4 million in net income Group share), and provisions for restructuring costs related to the Turbo project at CACEIS (-€5 million in expenses, -€3 million euros in net income Group share). Excluding these specific items, Crédit Agricole Group’s underlying net income Group share6 amounted to €1,924 million, a decline of -13.9% compared to third quarter 2021. Crédit Agricole Group – Stated and Underlying results, Q3-2022 and Q3-2021 €m +2.9 pp In third quarter 2022, underlying revenues amounted to €8,948 million, down -0.3%, and down -0.9% at constant scope Creval and Lyxor7, compared to third quarter 2021. Underlying operating expenses excluding the Single Resolution Fund (SRF) stood at €5,680 million in third quarter 2022, a year-on-year rise of +4.5% (+3.9% pro forma Creval and Lyxor). Overall, the Group’s underlying cost/income ratio excluding the SRF recorded an increase of +2.9 percentage points to 63.5% in third quarter 2022. Underlying gross operating income was down -7.5% year-on-year to €3,268 million. The cost of credit risk rose to -€636 million (of which -€209 million cost of risk on performing loans (stages 1 and 2), -€498 million cost of proven risk (level 3)), i.e. an increase of +57,8% compared to third quarter 2021, explained in particular by the continued provisioning of performing loans this quarter and +€71 million corresponding mainly to reversals of legal provisions in capital markets and investment banking. The provisioning levels were determined by taking into account several weighted economic scenarios, as in previous quarters, and by applying adjustments on sensitive portfolios (such as real estate, steel and aluminium, offset by a relief on the tourism sector). The economic scenarios are weighed, more severely than during the second quarter 2022, and include a favourable scenario (French GDP +4.0% in 2022 and +2.5% in 2023) and an unfavourable scenario (French GDP +1.9% in 2022 and -0.3% in 2023). They have nevertheless not been updated in the third quarter 2022. In addition, the cost of proven risk continues to normalise. It thus returned to its average quarterly level observed in 2019. The cost of credit risk relative to outstandings8 on a four quarter rolling period stands at 22 basis points. It stands at 23 basis points on a quarterly annualised basis9. As at 30 September 2022, risk indicators confirm the high quality of Crédit Agricole Group’s assets and risk coverage level. The diversified loan book is mainly geared towards home loans (46% of gross outstandings) and corporates (33% of gross outstandings). Loan loss reserves amount to €19.6 billion at the end of September 2022 (€10.4 billion for Regional Banks), 42% of which represented provisioning of performing loans (47% for Regional Banks). The loan loss reserves for performing loans have increased at Group level by +€2.9 billion since fourth quarter 2019. The prudent management of these loan loss reserves enables the Crédit Agricole Group to have the best10 overall coverage ratio for doubtful loans (86.9% at the end of September 2022) among largest European banks. Underlying pre-tax income stood at €2,750 million, a year-on-year decrease of -14.6%. The underlying pre-tax income included the contribution from equity-accounted entities for €111 million (up +4.0%) and net income on other assets, which came to €6 million in the second quarter. The underlying tax charge fell -16.1% over the period. Underlying net income before non-controlling interests was down -13.2% to €2,104 million. Non-controlling interests decreased -5.3%. Lastly, underlying net income Group share was €1,924 million, -13.9% lower than in third quarter 2021. Crédit Agricole group – Stated and underlying results, 9M-2022 and 9M-2021 €m +1.6 pp In the first nine months of 2022, stated net income Group share amounted to €6,104 million, compared with €6,746 million in the first nine months of 2021, a decrease of -9.5%. Specific items for the first nine months of 2022 include the specific items of the Regional Banks for the first nine months of 2022 detailed in the Regional Banks section and the specific items of Crédit Agricole S.A. for the first nine months of 2022 detailed in the Crédit Agricole S.A. results section. Excluding these specific items, underlying net income Group share amounted to €5,856 million, down -5.6% compared to the first nine months of 2021. Underlying revenues were up +3.1%. Underlying operating expenses excluding SRF were up +5.8%. As a result, the cost/income ratio excluding SRF for the first nine months of 2022 was 61.7%. Underlying gross operating income totalled €9,987 million, down -2.5% compared to the first nine months of 2021. Regional Banks Regional Banks’ activity and capture remained dynamic in third quarter 2022. Gross customer capture was buoyant with +912,000 new customers since the start of 2022 (287,000 in the third quarter), and a growing customer base +198,000 in the first nine months (56,000 in the third quarter). The share of customers using digital tools increased to 72.8%11 (+3.3 percentage points compared to end September 2021) and the number of online signatures12 jumped by +111.0% in the third quarter 2022 compared to the third quarter 2021. Propulse by CA, a 100% digital offer with non-banking services for micro-entrepreneurs and individual businesses, was launched this quarter. Loan production was stable this quarter (+0.5% compared to third quarter 2021), thanks to strong production on specialised markets13, offsetting the slight drop in home loan production (-3.4% compared to third quarter 2021). This performance should be compared with a 27% drop in new home loans on the portfolio of transactions guaranteed by Crédit Logement in third quarter 202214, and with the decrease by -11% observed by Banque de France over June/July/August between 2021 and 2022. In addition, the average customer loan production rate15 for the third quarter is now higher than the average loan outstandings rate. Outstandings reached €622.9 billion at end September 2022, rising over the year (+6.0% overall, +11.2% in the corporate market). Total customer assets rose by +2.1% year on year to €843.6 billion at the end of September 2022. This growth was driven by on-balance sheet deposits, which reached €572.4 billion at end September 2022, up +5.0% compared to end September 2021 (including +10.4% for passbook accounts and +4.8% for demand deposits). Off-balance sheet deposits reached €271.2 billion, down -3.5% year-on-year, with the impact of the stock market decline partially offset by strong inflows in the first nine months of 2022 in securities (net inflow of +€1.4 billion in the first nine months of 2022) and life insurance (net inflow of +€1.2 billion over nine months). In third quarter 2022, no specific items were recorded at the Regional Banks. In third quarter 2022, underlying revenues of the Regional Banks amounted to €3,328 million, down -2.3% from third quarter 2021. Operating expenses excluding SRF increased +3.7%. As a result, underlying gross operating income fell by -12.6%. The cost of risk amounted to -€273 million, multiplied by 2, due to conservative provisioning of performing loans (Stage 1 & 2) for -€166 million and a normalisation for proven risks (Stage 3). The Regional Banks’ contribution to the Group’s underlying net income Group share thus stood at €623 million, down -21.2%. In the first nine months of 2022, provisions for home purchase savings plans, with an impact of €411.9 million in revenues and €305.5 million in underlying net income Group share, were reclassified as specific items. For the first nine months of 2022, underlying revenues were down slightly (-0.7%) compared to the first nine months of 2021, due to the decline in the interest margin linked to the increase in the cost of customer resources and the TLTRO, and despite good momentum on fee and commission income. Operating expenses excluding SRF rose by +3.9%, with the SRF amounting to -€156 million (+9.7%) and underlying gross operating income down -9.5%. The underlying cost/income ratio excluding SRF worked out at 66.8%, up +2.9 percentage points. The underlying cost of risk rose by 74.5% to €830 million, due to a prudent provisioning of €585 million for performing loans and the beginning of normalisation for proven risks. Cost of risk/outstandings over a rolling four-quarter period remains low at 16 basis points; the NPL ratio is low at 1.6% and the coverage ratio remains high at 104.4% at end September 2022. The Regional Banks’ contribution to the Group’s underlying net income Group share thus stood at €1,862 million, down -14.8%. The Regional Banks’ contribution to the Group’s stated net income Group share thus stood at €2,167 million, down -3.3%. Crédit Agricole S.A. Results Crédit Agricole S.A.’s Board of Directors, chaired by Dominique Lefebvre, met on 9 November 2022 to review the financial statements for the third quarter and first nine months of 2022. Crédit Agricole S.A. – Stated and underlying results, Q3-2022 and Q3-2021 €m +2.1 pp In third quarter 2022, Crédit Agricole S.A.’s stated net income Group share amounted to €1,352 million, a decrease of -3.6% from third quarter 2021. Specific items for the quarter totalled +€79 million and include recurring accounting items for an impact of -€0.4 million in net income Group share. These include the following items: recurring accounting volatility items in revenues, such as the DVA (Debt Valuation Adjustment), the issuer portion of the FVA, and secured lending for +€10 million in net income Group share, and the hedging of the loan book in the Large Customers segment for -€10.4 million in net income Group share. Specific items also include non-recurring items for an impact of +€79 million in net income Group share. They include the capital gain on the disposal of La Médicale in insurance activities held for sale for an impact of +€101 million in net income, Group share, and the costs of integrating Lyxor in asset management expenses for -€4 million in net income Group share, as well as the exceptional provision on moratoria (home loan credits) in Poland for -€17 million. In the third quarter of 2021, specific items had a net negative impact of -€12 million on net income Group share. They included recurring volatile accounting items in revenues, such as the DVA (Debt Valuation Adjustment, i.e. gains and losses on financial instruments related to changes in the Group’s issuer spread) amounting to +€3 million in net income Group share and hedges on the Large customers loan book for -€4 million in net income Group share. In addition to these recurring items, there are also the following: acquisition costs of Credito Valtellinese for -€4 million in net income Group share, the reclassification of CA Serbia as an asset held for sale (IFRS 5) for an impact of -€4 million in net income Group share and the provisions for restructuring costs in the context of the Turbo project, CACEIS transformation and development plan for -€5 million in expenses and -€3 million in net income Group share. Excluding specific items, underlying net income Group share16 was €1,273 million, down -10.0% in the third quarter of 2022 from third quarter 2021, which was a historically high level. Activity of the business lines remained dynamic, but their profitability was impacted over the quarter by significant market effects, despite support, thanks primarily to steady activity in all business lines and a strong increase in income. In the third quarter of 2022, underlying revenues reached €5,585 million, and were up +0.9% over third quarter 2021 (and +1.9% for the revenues of the business lines excluding Corporate Centre). This growth in revenues in third quarter 2022 is consistent with the steady growth in quarterly revenues of Crédit Agricole SA over the last five years, thanks to the diversity of the business mix. Underlying operating expenses excluding SRF totalled €3,394 million in the third quarter of 2022, an increase of €149 million, or +4.6% (and +4.3% for the expenses of the business lines, excluding Corporate Centre). Pro forma for the integration of Lyxor and Creval, this increase is brought down to +3.3% compared to 2021, i.e. +€108 million, and to +3.3% for the expenses of the business lines, excluding Corporate Centre. After adjusting for foreign exchange impact (mainly on CACIB and CA Indosuez, for approximately €37 million), it came to +€71 million, in support of the business lines’ growth. Of this +€71 million increase, the Large customers division posted a rise in expenses of +€55.3 million compared with the third quarter of 2021, including +€25.5 million related to staff costs and variable compensation and +€18 million related to IT investments. The Specialised financial services division recorded a decrease of -€12.1 million, including -€19.2 million from the scope effect of CACF NL and Olinn. The Asset gathering and insurance division saw its expenses rise by +€5 million, including +€11.6 million in investments and IT costs and +€1.8 million in staff costs and variable compensation. Lastly, Retail banking division saw its expenses rise by +€5.7 million compared to the third quarter of 2021, of which +€8.1 million on IT expenses and -€1.7 million on staff expenses. The cost/income ratio excluding SRF thus stood at 60.8% in the third quarter of 2022, up +2.1 percentage points compared to third quarter 2021. Gross underlying operating income for third quarter 2022 totalled €2,191 million, down -4.3% (-5.1% Pro forma for Creval and Lyxor). As at 30 September 2022, risk indicators confirm the high quality of Crédit Agricole S.A.’s assets and risk coverage level. The diversified loan book is mainly geared towards home loans (27% of gross outstandings) and corporates (46% of Crédit Agricole S.A. gross outstandings). The non-performing loan ratio was still low at 2.6%, and the coverage ratio17, while high at 73.2%, was down -1.1 percentage points over the quarter18. Loan loss reserves amounted to €9.3 billion for Crédit Agricole S.A., a +€0.1 billion increase from end June 2022. Of these loan loss reserves, 37% are for performing loan provisioning. Loan loss reserves for performing loans are higher by €1.4 billion compared with the fourth quarter of 2019. The cost of risk shows a net provisioning of -€360 million (+35.5%/-€94 million compared to third quarter 2021 when it stood at -€266 million, a historically low level). The expense of -€360 million in third quarter 2022 consists of the provisioning for performing loans (Stages 1&2) for -€42 million (versus an allocation of -€27 million in third quarter 2021), provisioning for proven risks (Stage 3) for -€377 million (versus -€234 million in third quarter 2021), which is a return to the average level recorded in 2019 (-€362 million from +€59 million in other items, essentially corresponding to reversals of legal provisions in capital markets and investment banking. In third quarter 2022, the cost of risk/outstandings over a rolling four-quarter period19 was 31 basis points, and 30 basis points on an annualised quarterly basis20. The underlying contribution of the equity-accounted entities remained stable at €102 million in third quarter 2022 versus €103 million in third quarter 2021. Net income on other assets stood at €5 million in third quarter 2022, vs. -€9 million in third quarter 2021. Underlying income21 before tax, discontinued operations and non-controlling interests was therefore down -8.5% to €1,939 million. The underlying effective tax rate stood at 25.4% (+1.9 percentage points compared to third quarter 2021), while the underlying tax charge was down -1.6% at -€467 million. The underlying net income before non-controlling interests was therefore down -9.0%. Non-controlling interests amounted to -€221 million in third quarter 2022, down -3.3%. Underlying net income Group share was down by -10.0% compared to third quarter 2021 at €1,273 million. Underlying earnings per share in third quarter 2022 reached €0.38, decreasing by -11.8% compared to third quarter 2021. Crédit Agricole S.A. – Stated and underlying results, 9M-2022 and 9M-2021 €m +0.8 pp In the first nine months of 2022, stated net income Group share amounted to €3,880 million, compared with €4,416 million in the first nine months of 2021, a decrease of -12.1%. Specific items in the first nine months of 2022 had a negative impact of -€57 million on stated net income Group share. In addition to the third quarter items already mentioned above, the first-half 2022 items had a negative impact of -€136 million on stated net income Group share and included the recurring volatile accounting items, i.e. the DVA, FVA and secured lending for -€6 million, and coverage of Large Customers loan books for +€53 million. To this were added the changes in the Home Purchase Savings provision for +€63 million, the Credito Valtellinese integration costs in Retail banking in Italy for -€16 million and those for Lyxor in asset management for -€26 million in net income Group share, as well as the provision for Ukraine equity risks for -€195 million in cost of risk, and the reclassification of Crédit du Maroc to assets held for sale for -€10 million. The specific items for the first nine months of 2021 had a positive impact of +454 million on stated net income Group share with the recurring volatile accounting items, specifically the DVA for +€4 million, hedges of the Large customers loan book for -€15 million, and changes in the provision for home purchase savings plans for -€6 million. Added to this were the following items: the excess SRF contributions paid for financial years 2016 to 2020 for +€130 million; wealth management losses in Miami and Brazil in the process of disposal for +€2 million within the Wealth management sub-division, the reclassification of CA Serbia as assets held for sale (IFRS 5) for -€4 million; Credito Valtellinese acquisition costs for -€4 million; costs of integration of Kas Bank and S3 by CACEIS for -€2 million, transformation costs related to the LCL New Generation Network project at LCL for -€9 million, and the Turbo project, the CACEIS transformation and development plan for -€11 million, the preliminary net badwill for the initial consolidation of Creval for +€285 million, the Creval acquisition costs -€8 million, additional provisioning for Creval performing loan outstandings for -€19 million, as well as the Affrancamento gains related to exceptional tax provisions in Italy for the non-accounting revaluation of goodwill and its amortisation amounting to +€111 million in net income Group share for the IRB (+€28 million), AG (+€78 million) and SFS (+€5 million) divisions. Excluding these specific items, underlying net income Group share reached €3,937 million, down -0.6% compared to the first nine months of 2021. Underlying earnings per share were €1.22 per share for the first nine months of 2022, down -0.9% compared to the first nine months of 2021. Underlying RoTE22, which is calculated on the basis of an annualised underlying net income Group share23 and IFRIC charges linearised over the year, net of annualised Additional Tier 1 coupons (return on equity Group share excluding intangibles) and restated for certain volatile items recognised in equity (including unrealised gains and/or losses), reached 12.5% for the first nine months of 2022, -0.6 percentage point from the first nine months of 2021. Underlying revenues rose by +4.9% over the first nine months of 2021, with revenue growth in all divisions (increase of +4.9% in the business lines, excluding Corporate Centre), despite unfavourable market effects impacting our stocks activities, more specifically the Asset gathering and insurance business line. At constant scope (integration of Créval and Lyxor in the results for the first nine months of 2021), revenues were up 2.8%. Excluding Corporate Centre, and at constant scope, they were also up +2.8% over the first nine months of 2022. Underlying operating expenses excluding SRF increased by +6.4% compared to the first nine months of 2021. At constant scope (integration of Créval and Lyxor in the results for the first nine months of 2021)24, they rose 3.8% (€+376 million). This increase, which supports the growth of the business lines, was primarily driven by the increase of +118 million in investments and IT expenses, in particular at CACIB (+€41 million), CAA (+€28 million) and Amundi (+€16 million); secondly, by the increase of +€87 million in payroll, particularly at CACIB (+€75 million) – note that Amundi’s payroll declined by -€19 million because of the drop in variable compensation – primarily because of the anticipation in July of the 2023 increase in fixed compensation in France; and thirdly, because of the foreign exchange impact of +€85 million. Excluding Corporate Centre, business line expenses rose by 6.1%. Excluding Corporate Centre and at constant scope, they were up +€306 million (+3.3%). The underlying cost/income ratio excluding SRF for the first nine months was 58.1%, an increase of +0.8 percentage point compared to first nine months of 2021. The cost/income ratio is therefore lower than the Medium Term Plan target of 60% each year. Since 2017, the cost/income ratio25 of Crédit Agricole S.A. has remained more than 5 percentage points lower than that of a sampling of ten European banks26. The SRF for the first nine months of 2022 totalled €647 million, up +24% compared to the same period in 2021. Underlying gross operating income thus totalled €6,773 million, up +1.2%. Lastly, the cost of risk reached -€1,108 million and increased over the period (+22.6%/-€204 million compared with -€904 million over the first nine months of 2021, mainly due to the provisioning following the beginning of the Ukraine/Russia war in first quarter 2022 and the gradual normalisation of the proven cost of risk. Analysis of the activity and the results of Crédit Agricole S.A.’s divisions and business lines Activity of the Asset Gathering division In third quarter 2022, activity of the Asset gathering (AG) division was strong in a market with high outflows and unfavourable market conditions. Assets under management stood at €2,403 billion at the end of September 2022 (+3.6% vs end September 2021). Compared to end June 2022, they fell by -€31 billion, driven by net outflows of -€11.9 billion, out of which -€12.9 billion from Asset management, +€1.5 billion from Wealth management and -€0.1 billion from Life insurance, as well as a negative market effect of -€19 billion. Insurance (Crédit Agricole Assurances) posted a solid performance in third quarter 2022, despite the inflationary context and the continued increase in rates. For Crédit Agricole Assurances27, this quarter was marked by the finalisation of the disposal of La Médicale with a capital gain of €101 million recorded in stated net income for third quarter 2022. Savings / Retirement activity was impacted by the economic and financial environment, with premium income down by -16% over one year. Gross inflows totalled €5 billion with a share of unit-linked products at 37.8%. A light net outflow of -€0.1 billion was recorded this quarter, which was related to the decrease in net inflows on euro-denominated policies (-€0.9 billion), offset by the positive inflow in unit-linked products (+€0.8 billion). Assets (savings, retirement and death and disability) stood at €318 billion, stable over one year, with a share in euro outstandings up +1.7% compared to September 2021. Unit-linked contracts accounted for 24.8% of assets under management, down -1.3 percentage point over one year in connection with the decline in equity markets. It should be noted that, in this quarter, CAA became the second largest retirement insurer in France according to Argus de l’Assurance, thus moving up two places over the previous ranking28. In property and casualty insurance, despite the increase in claims in third quarter 2022, activity remains dynamic, with premium income up +6.7%29compared to the third quarter of 2021. At end September 2022, the portfolio of property and casualty policies totalled nearly 15.2 million30, a +3.5% increase over one year at constant scope, following the disposal of La Médicale tocim Generali. The equipment of individual customers in the banking networks of Crédit Agricole Group was stable vs end September 2021 for the Regional Banks (42.6%, -0.1 percentage point) and LCL (27.1%, +0.6 percentage point), and up for CA Italia (20.6%, +1.8 percentage point; 16.1% including the Créval customer base). The combined ratio remained under control at 98.7%, down slightly by -1.8 percentage point year-on-year, due to the climate events that occurred in the first nine months of 2022. In death & disability/creditor and group insurance, premium income came in at €1.1 billion this quarter, an increase of +7.4%29 vs third quarter 2021, driven notably by the increase in creditor insurance activity related to the strong trend in property loans (+6%) and the steady performance of consumer finance (+10%). Group insurance activity was also strong, with growth in premium income of +17.9%. Asset management (Amundi) posted a resilient third quarter 2022, in particular in medium and long-term assets (MLT), in a market with high level of outflows. Assets under management totalled €1,895 billion at end September 2022 (including the integration of the Lyxor assets for €148 billion at 31 December 2021), a year-on-year increase of +4.7% and down -1.5% compared to the end of June 2022. This quarter has been impacted by a negative market and foreign exchange effects of -€16.3 billion given the unfavourable market conditions, and an outflow of -€12.9 billion (out of which -€3.5 billion in MLT assets excluding JVs). In the third quarter of 2022, activity was resilient in medium/long-term assets excluding JVs. In Retail, activity trended well in the networks (+€1.9 billion in MLT assets in France and abroad). The institutional inflows in active management are positive (+€2.7 billion in MLT assets), driven by equity and bond products. The ‘derisking’ context explains the outflows in passive management for institutional investors and third-party distributors. Business in the Asian JVs was negative this quarter (-€1.3 billion), primarily related to the outflows in cash and cash equivalent products in China. In contrast, inflow in MLT assets was positive (+€2.1 billion), notably thanks to the momentum of the Indian JV. Amundi Technology continued its growth, primarily by increasing the number of its customers. In wealth management31, assets under management amounted to €190.1 billion at end September 2022 (out of which €130.3 billion for Indosuez Wealth Management), stable compared to the end of June 2022 and end of September 2021. The positive net inflows of third quarter 2022 (+€1.5 billion vs end June 2022), offset the negative market effect. Results of the Asset Gathering division The Asset gathering (AG) business line posted underlying net income Group share of €555 million in third quarter 2022, down -3.1% from third quarter 2021. Positive income from the insurance activities (+4.1%) and wealth management (+24.2%) mitigate a decline in asset management (-17.7%), which was severely impacted by the adverse market conditions. For the first nine months of 2022, underlying net income Group share was €1,710 million, down -1.6% vs the first nine months of 2021. Over the same period, the Asset Gathering division’s contribution to underlying net income Group share and the underlying revenues of Crédit Agricole S.A.’s core businesses (excluding the Corporate Centre division) was 38% and 28%, respectively. As at 30 September 2022, equity allocated to the business line amounted to €12.6 billion, including €10.9 billion for Insurance, €1.2 billion for Asset management, and €0.4 billion for Wealth management. The business line’s risk weighted assets amounted to €35.7 billion, including €18.1 billion for Insurance, €12.9 billion for Asset management and €4.7 billion for Wealth management. The underlying RoNE (Return on Normalised Equity) for the business line stands at 20.8% for the first nine months of 2022, versus 24.4% for full year 2021. Insurance results Underlying insurance revenues totalled €602 million in third quarter 2022, representing a +1.3% increase (+6.8% at constant scope32) compared to third quarter 2021. Underlying costs in third quarter 2022 rose +2.5% (+12.1% at constant scope32) compared to third quarter 2021, in line with the rise in payroll to support the development of growth businesses, specifically group insurance and creditor insurance, in addition to the IT costs associated with regulatory projects. Underlying gross operating income stood at €423 million, a slight increase of +0.8% compared to the third quarter 2021. The underlying cost/income ratio stood at 29.6% in the third quarter 2022, remaining stable over the same period (+0.4%). Net income from discounted or held-for-sale operations was up +€13 million this quarter. This corresponds to the impact of the finalisation of the disposal of La Médicale on the recognition of Crédit Agricole Assurances Group intra-Group transactions, offset by equally amounted negative impact on insurance revenues. The tax charge increased slightly by +1.3% to -€65 million. Underlying net income Group share was therefore €352 million, up by +4.1% compared to third quarter 2021. This result does not include the capital gain of +€101 million from the disposal of La Médicale posted in stated net income in third quarter 2022. For the first nine months of 2022, underlying revenues from reached €1.990 million, up +2.2% (+5.1% at constant scope33) compared to the first nine months of 2021, due to the increased recognition of the financial margin and the reversal of technical reserves, as well as the positive impact on income of the total unwinding of the Switch in the fourth quarter 2021, which offset the market effect and increased claims. Expenses increased +4.9% (+12.7% at constant scope33) driven primarily by an increase in taxes related to growth in premium income adversely impacting the C3S34, in addition to the costs associated with business development. The cost/income ratio therefore stood at 31.0%, up +0.8 percentage point compared to the first nine months of 2021. Underlying gross operating income thus increased by +1.0%. The tax charge for the first nine months of 2022 decreased by -7.6% compared to first half 2021, due to the decrease in the effective tax rate, despite an unfavourable tax impact related to the payment of a special dividend of €2 billion. Lastly, net income from discounted or held-for-sale operations stood at +€17 million over the first nine months due to the finalisation of the disposal of La Médicale in the third quarter 2022. As a result, net income Group share reached €1,089 million, an increase of +4.9% (+4.3% at constant scope33) compared to first half 2021. Asset management results In third quarter 2022, underlying revenues reached €738 million, down -4.7% compared to third quarter 2021 (-11.4% at constant scope35). Net management fees were resilient in the adverse market conditions, up +6.7% (-1.3% at constant scope35). Performance fees declined, however, compared to the record level posted in 2021. Underlying operating expenses stood at €424 million, up +8.6% as a result of the integration of Lyxor since first quarter 2022, but down -1.6% at constant scope35 The underlying cost/income ratio excluding SRF therefore stood at 57.5%. Underlying gross operating income decreased by -18.2%. The contribution from equity-accounted entities, comprising the contribution from the Amundi joint ventures in Asia, stood at €24 million, down -5.0%, and the tax charge of -€76 million represents a decrease of -24.5%. Lastly, underlying net income Group share decreased by -17.7% to €174 million. In the first nine months of 2022, underlying revenues were down -3.1% compared to the first nine months of 2021 (-9.1% at constant scope35). The drop in revenues is impacted by the anticipated decline in performance fees (€108 million compared to €356 million over the first nine months of 2021), offset by a significant rise in net management fees (+2.6% at constant scope35) despite the sharp drop of the equity and fixed income markets. Underlying operating expenses excluding SRF increased by +10.0% related to the integration of Lyxor. Charges remained stable at constant scope35 thanks, in particular, to the beginning of synergies with Lyxor. The underlying cost/income ratio excluding SRF was 56.1%, up +6.7 percentage points compared to the first nine months of 2021, which saw very high performance fees. Thus, gross operating income fell by -16%. The net income of equity-accounted entities increased by +2.0%. All in all, net income Group share for the first nine months stood at €543 million, a decrease of -13.7%. Wealth management results36 In the third quarter 2022, underlying wealth management revenues stood at €226 million, up +11.6% compared to third quarter 2021 (+6.8% excluding the foreign exchange impact), benefiting primarily from a favourable product mix, dynamic inflows, the euro and dollar interest rate hikes and a positive foreign exchange impact. Underlying costs excluding SRF reached €191 million, up +9.9% (+4.5% excluding the foreign exchange impact) primarily due to rising IT costs. The jaws effect was positive this quarter at +1.7 percentage point (+2.3 percentage points excluding the foreign exchange impact) and the underlying cost/income ratio decreased by -1.3 percentage point to 84.3% in third quarter 2022. Underlying gross operating income, excluding SRF, rose +21.7% to €36 million. Underlying net income Group share thus reached €29 million, up +24.2% compared with the third quarter of 2021. For the first nine months of 2022, underlying revenues for the wealth management business in stood at €672 million, up +9.7% compared to the first nine months of 2021 (+6.0% excluding the foreign exchange impact). Costs excluding SRF were up +9.9%. (+5.8% excluding the foreign exchange impact), reaching €568 million. Underlying gross operating income was up +9.0% at €101 million. All in all, net income Group share was up +9.6% for the first nine months of 2022, reaching €78 million. Activity of the Large Customers division Business activity in Corporate and Investment Banking (CIB) as a whole reached very good levels for a third quarter in 2022. Underlying revenues were up to €1,296 million, or +4.5% compared to third quarter 2021 (-1.2% excluding the foreign exchange impact). This growth was driven by the strong performance of financing activities at €776 million, i.e. +12.6% compared to third quarter 2021 (+4.4% at constant scope). Commercial banking was notably driven by record International Trade & Transaction Banking business activity with the return to positive interest rates and strong client demand and by positive results from the Telecom business line. It saw growth of +12.1% compared to third quarter 2021. Structured finance activities also posted a good quarter, at €264 million, up +13.5% compared to the third quarter of 2021. Capital markets and investment banking, at €520 million, saw a slight drop of -5.7% compared to third quarter 2021 (-8.1% excluding foreign exchange impact). It maintains dynamic commercial activity, with +7.9% growth in interest rate and foreign exchange hedging products, but was penalised by negative valuation impacts (xVA and model reserves) associated with the current volatility. In investment banking, customers remain cautious and are awaiting a more favourable business environment. In this atypical environment, CIB improved its overall position over the first nine months, with revenues up +10.2% compared to the first nine months of 2021 (+5.8% at constant scope). Underlying revenues in financing activities increased significantly to €2,278 million in 2022, +12.4% compared to the first nine months of 2021 and +6.1% excluding the foreign exchange impact. Financing activities thus maintained its leading position in syndicated loans (#1 in France37 and #2 in EMEA37) and was ranked #3 in project finance loans worldwide37. Revenues from capital markets and investment banking were up to €2,022 million in the first nine months of 2022, +7.8% compared to the first nine months of 2021 and +5.4% excluding the foreign exchange impact. CACIB strengthened its leading positions in bond issues, becoming #3 All bonds in EUR Worldwide37, and confirming itself as #2 Green, Social & Sustainable bonds in EUR38. Average regulatory VaR increased to €18.7 million in third quarter 2022 from €6.1 million in third quarter 2021 (and €14.5 million in third quarter 2020), reflecting the market and interest rate shocks over the period. However, it remained at a low level, reflecting prudent risk management. On 17 October 2022, CACEIS announced it was entering into a Master Agreement stipulating CACEIS’s potential acquisition of RBC’s investors services activities in Europe. With this acquisition, CACEIS would further enhance its positioning among the world’s asset servicing leaders in Europe and worldwide, becoming #1 in Europe in terms of assets under administration with close to €3,500 billion39 and #2 in terms of assets under custody with €4,800 billion39. This transaction would also diversify the profile of customers by lowering the share of French customers to 50% primarily in favour of customers from English speaking countries and Luxembourg. Prior to being signed, agreements between CACEIS and Royal Bank of Canada must be reviewed by relevant work councils and the transaction will be subject to the customary closing conditions, including applicable regulatory approvals. This transaction would be in line with the Group's development objectives and would respect our profitability criteria with an expected return on investment of more than 10% over 3 years thanks to the realisation of synergies. It would have a negative impact of less than 10 basis points on the CET1 of Crédit Agricole S.A. and Crédit Agricole Group40. In the third quarter, Asset servicing (CACEIS) continued to face significant market effects on its assets, bringing them to levels near those in mid-2020. Assets under custody were down -9.0% at end September 2022 compared to end September 2021, reaching €3,975 billion. Assets under administration were down -8.5% year-on-year to €2,107 billion at end September 2022. The momentum of the customer business was not enough to offset the impact of long rates evolution or equity markets on assets. Results of the Large Customers division In third quarter 2022, the underlying revenues of the Large customers division amounted to €1,608 million, up +5.2% compared to third quarter 2021, buoyed by a solid performance in the financing activities and asset servicing business lines. Operating expenses excluding SRF were up compared to third quarter 2021 (+9.1%), with the development of the business. The gross operating income for the division remained stable (-0.4%) over the quarter. The division recorded an overall net provision for cost of risk of -€34 million in third quarter 2022, including reversals of legal provisions, compared to a provision of -€12 million in third quarter 2021. Pre-tax income totalled €603 million, down slightly by -2.9%. The tax charge increased by +13.6% to €156 million. Lastly, net income Group share reached €412 million in the third quarter of 2022, down -9.5% after the impact of the increase in the non-controlling interests of CACEIS. In the first nine months of 2022, the underlying revenues of the Large customers division amounted to €5,237 million, or +9.8% compared to the first nine months of 2021. Operating expenses excl. SRF increased by +7.3% to €2,905 million, reflecting support for growth and IT investments (including the enhancement of the F/O platform and improvement in the e-business offer in capital markets). SRF expenses were up +34.7% compared to the first nine months of 2021. Gross operating income for the period totalled €1,890 million, representing an increase of +8.9% compared to the first nine months of 2021. The cost of risk for the first nine months of 2022 had a net provision of -€236 million compared to a net provision of -€38 million in the first nine months of 2021, mainly due to the impact of the Russia/Ukraine war and its consequences in terms of provisioning on performing loans in the first quarter 2022. The division’s contribution to underlying net income Group share was €1,165 million, down -4.9% from the first nine months of 2021. The business line contributed 26% to the underlying net income Group share of Crédit Agricole S.A.’s core businesses. (excluding Corporate Centre division) in the first nine months of 2022 and 30% to underlying revenues excluding Corporate Centre division. At 30 September 2022, the equity allocated to the division was €14.6 billion and risk weighted assets were €153.7 billion. The division’s underlying RoNE (Return on Normalised Equity) stood at 11.8% for the first nine months of 2022, versus 13.1% for the first nine months of 2021. Corporate and Investment banking results In third quarter 2022 underlying revenues from corporate and investment banking activities was up +4.5% compared to the third quarter of 2021, at €1,296 million, reflecting solid commercial performance in financing activities and capital markets, despite the latter suffering from the negative impacts of market valuations (xVA and model reserves) associated with the current volatility. Underlying operating expenses excluding SRF were up +12.2% this quarter compared to third quarter 2021, and reached -€764 million, due to an expanded portfolio of IT projects (enhancement of the F/O platform and improvement of the e-business offering) and to activity development (headcount and compensation.) However, gross operating income was down -5.0% compared to third quarter 2021 and reached €532 million. The cost of risk recorded a net provision of -€32 million, compared to a provision of -€14 million in third quarter 2021, which can be explained by the provisioning on credit risk of -€98 million and a reversal of legal risk provisions of +€65 million in capital markets and investment banking. Lastly, pre-tax income in third quarter 2022 stands at +€501 million, down -7.8% compared to third quarter 2021. The tax charge was €134 million. All in all, underlying net income Group share was €358 million in third quarter 2022, a decline of -13.9% compared to the third quarter of 2021. In first nine months of 2022, underlying revenues rose +10.2% compared to the first nine months of 2021, to €4,300 million, up +5.8% at constant exchange rates. Financing activities continued to grow with revenues up +12.4% in the first nine months while capital markets and investment banking saw positive business momentum despite being penalised by market valuations. The latter therefore did not rise as much, +7.8% in the first nine months of 2022. Underlying expenses excluding SRF increased by +9.4%, related to the organic growth strategy and business development of CIB, whereas SRF expenses were up more significantly in the first nine months, by +30.2% to €384 million. Thus, underlying gross operating income at €1,671 million was up sharply (+7.6% compared to the first nine months of 2021.) The cost of risk recorded a depreciation of -€236 million during the first nine months of 2022, in keeping with the conservative provisioning of Russian exposures in the first quarter (a provision of -€346 million on performing loans in Russia in the first quarter 2022), versus -€45 million in the first nine months of 2021. The tax charge was -€366 million, up +15.6% and the contribution from the business line to Net income Group share was down by -7.4% to €1,045 million. Risk-weighted assets at end September 2022 were up (+€11.4 billion compared with end June 2022, of which +€5.5 billion was due to the foreign exchange impact –market and credit- and +€2.2 billion of model effects namely TRIM), totalling €144.0 billion. Asset servicing results In third quarter 2022, underlying revenues of asset servicing were up a strong +8.3% compared to third quarter 2021, to €312 million. This increase was mainly due to the good performance of the interest margin over the period (+40.3%), linked to the cash management activity, which benefited from the rise of interest rates and offset the decline in fee and commission income resulting from the market impact on assets. Underlying operating expenses excluding SRF were stable at €214 million (-0.6%), and benefited from operational efficiency plans. As a result, underlying gross operating income was up sharply by +34.7% to €98 million in third quarter 2022. Underlying net income totalled €79 million, a rise of +36.1%. After sharing €25 million with non-controlling interests, the business line’s contribution to underlying net income Group share during third quarter 2022 was up +37.2% year-on-year at €54 million. Underlying revenues for the first nine months of 2022 were up +7.9% compared to the first nine months of 2021, driven by the increase in the net interest margin (+23.4%) and flow activities, which offset the decrease in fee and commission income linked to the drop in assets. Underlying expenses excluding SRF were under control with a slight increase of +1.0% as a result of the effect of the operational efficiency plan. Underlying gross operating income was up +20.3% compared to the first nine months of 2021 and underlying net income was up +13.4%. The overall contribution of the business line to net income Group share in the first nine months of 2022 was €120 million, a +23.3% increase. Specialised financial services activity Crédit Agricole Consumer Finance (CACF) loan production was up 12.6% in third quarter 2022 compared with third quarter 2021, driven by very strong activity at Agos (+16.8%) and the Automotive JVs (+22.9%), despite the persistent shortages of electronic components in the automotive market. At end September 2022, CACF’s total outstandings therefore stood at €98.9 billion, i.e., +8.7% compared to end September 2021. Crédit Agricole Leasing and Factoring (CAL&F) commercial production in leasing remains strong, increasing by +15.5% compared to third quarter 2021. Commercial production in factoring fell by -18.5% due to macroeconomic conditions. Factored revenues, however, reached €28.4 billion, up +20.8%, under the effect of inflation, but also driven by the rise of the pan-European platform. Leasing outstandings reached €17 billion at end September 2022 (of which €13.6 billion in France and €3.3 billion abroad), i.e. +5.8% compared to end September 2021. Specialised financial services’ results The financial results of Specialised Financial Services were impacted by some changes in scope. For Consumer finance, CACF NL (classified under IFRS 5 since third quarter 2020 and reinstated line by line on the third quarter 2021 results) was removed from the following comparisons between third quarter 2022 and third quarter 2021; CACF Spain (formerly 50% owned and equity-accounted, has been fully consolidated since third quarter 2021) was not restated for the quarterly comparisons, but only for the comparisons between the first nine months of 2022 and the first nine months of 2021. Lastly, as regards Leasing and Factoring, Olinn (acquired in fourth quarter 2021) was removed from the quarterly and cumulative comparisons. At constant scope41, excluding CACF NL and Olinn, underlying revenues from specialised financial services amounted to €683 million in third quarter 2022, up +2.2% compared to third quarter 2021, driven by strong revenues from CACF. The underlying expenses excluding SRF totalled -€341 million, i.e. a +1.9% increase. Underlying gross operating income was up (+2.4%), while the underlying cost/income ratio excluding SRF remained low at 49.9% (-0.1 percentage point). The underlying cost of risk increased by +32.0% compared to a historically low third quarter 2021. Underlying net income group share totalled €206.8 million, up by +4.1%. The following data for the Specialised Financial Services business line for the first nine months of 2022 is presented on a like-for-like basis42, excluding CACF Spain and Olinn. Underlying revenues in Specialised Financial Services increased by +1.6% compared to the first nine months of 2021, driven by a good performance at CACF and CAL&F. Underlying expenses excluding SRF were up +1.8%. The underlying cost/income ratio excluding SRF remained low at 51.3%%, an increase of +0.1 percentage point. The contribution to the SRF amounted to -€34 million for the first nine months of 2022, an increase of +47.9%. The underlying cost of risk increased slightly by +0.5%. The contribution of equity-accounted entities in underlying terms increased by +0.2%. Underlying net income Group share was therefore up +2.3% at €585 million. The business line contributed 13% to the underlying net income Group share of Crédit Agricole S.A.’s core businesses. (excluding Corporate Centre division) in the first nine months of 2022 and 12% to underlying revenues excluding Corporate Centre division. At 30 September 2022, the equity allocated to the division was €5.5 billion and its risk weighted assets were €58.4 billion. The division’s underlying RoNE (Return on Normalised Equity) stood at 14.9% for the first nine months of 2022, versus 15.2% for 2021. Consumer finance results The following data for CACF for third quarter 2022 is presented excluding scope effect43, i.e. excluding CACF NL. CACF’s underlying revenues reached €533.5 million, up +3.1% compared to third quarter 2021, thanks to dynamic activity and the gradual rise in customer rates, and despite the continued rise in refinancing costs. Underlying expenses excluding SRF increased +0.9%. Underlying gross operating income increased by +5.2% and the underlying cost/income ratio excluding SRF remained low at 48.2%%, a decline of -1.0 percentage point. The contribution of equity-accounted entities in underlying terms reached €82 million (+3.9%). The underlying cost of risk was €140.4 million, up +43.4%, taking into account an exceptionally low third quarter 2021 benchmark (€92 million, the lowest level seen since first quarter 2019). Underlying taxes amounted to -€32.4 million in third quarter 2022, down -33%. Underlying net income Group share totalled €157.6 million in third quarter 2022, up by +0.5%. Concerning the level of risk and changes in it, the following data is presented excluding scope effect. The underlying cost of risk reached -€141 million over the quarter, mainly due to provisions for proven risks of -€129 million (Stage 3), as well as provisions of -€7 million for performing loans (Stages 1 and 2); the cost of risk for outstandings, which is in the process of normalisation, reached 128 basis points over a rolling four-quarter period44, identical to the average level for 2019. After integrating the cost of risk of automotive JVs, it stands at 102 basis points; the non-performing loan ratio stands at 5.0%, stable compared to end June 2022, and the coverage ratio reached 88.4%, down -0.3 percentage point compared to end June 2022. The following data for CACF for the first nine months of 2022 is presented excluding scope effect45, i.e. excluding CACF Spain. Underlying revenues rose by 1.1% compared to the first nine months of 2021, as the dynamic activity, especially in less risky outstandings, and the gradual rise in customer rates offset the rise in refinancing costs. Underlying expenses excluding SRF were up +0.3%, the contribution to SRF amounted to -€16 million (+65.3%), the underlying cost/income ratio excluding SRF remained low at 50.3%, down -0.4 point. Underlying gross operating income increased (+1.1%). The underlying cost of risk increased by +5.5% and reached -€340 million. The contribution of equity-accounted entities rose by +0.2% in underlying terms. All in all, the business line’s contribution to underlying net income Group share amounted to €468.7 million for the first nine months, up +0.3% in underlying terms. Leasing & Factoring results The following data for CAL&F for the third quarter is presented excluding scope effect46, i.e. excluding Olinn. Underlying revenues totalled €149 million, down -1.2% compared to third quarter 2021. Underlying costs excluding SRF were up by +5.2% due to activity growth and IT investments. The underlying cost/income ratio excluding SRF was 56.0%, an increase of +3.4 percentage points. Underlying gross operating income thus fell by -8.2%. The underlying cost of risk decreased significantly (-39.0%) compared to third quarter 2021 which was marked by high provisioning. Underlying net income Group share was up +0.7% at €42.2 million. The following data for CAL&F for the first nine months of 2022 is presented excluding scope effect47, i.e. excluding Olinn. Underlying revenues were up 3.4% compared to end September 2021, thanks in particular to strong factoring activity. Underlying expenses excluding SRF were up +6.7%, in line with the growth in activity. The contribution to the SRF amounted to -€18 million (+35.0%). This led to a decrease in underlying gross operating income of -2.9%. The underlying cost/income ratio excluding SRF amounted to 54.7%, an increase of +1.7 percentage point. The underlying cost of risk fell significantly in 2021 (-35.0%). Lastly, underlying net income Group share was up +11.1% at €116 million. Crédit Agricole S.A. Retail Banking activity The Crédit Agricole S.A. Retail banking activity was strong this quarter, driven at LCL by the production of corporate and professional loans and at Crédit Agricole Italia by resilient commercial activity. Loan production at LCL increased in third quarter 2022 compared to third quarter 2021 (+10%48), in corporate loans (+34%48 and professional loans (+37%48) in particular. Home loan production, although slightly down (-2%), remained at a high level, with average home loan production rate higher than the average outstanding rate in the third quarter. In this context, outstanding loans increased by +9.2% since end September 2021, to €161.3 billion, including +9.2% for home loans, +8.9% for loans to professionals, +10.6% for corporate loans and +5.3% for consumer finance. Customer assets were stable at +0.4% compared to end September 2021, driven by on-balance sheet deposits (+2.4%) from the increase in passbooks and time deposits, and despite off-balance sheet savings, which fell by -3.1% due to an unfavourable market effect. Lastly, gross customer capture was 263,400 in the first 9 months (85,400 in third quarter), and the increase in the customer base was 43,400 in the first 9 months of the year, and 16,500 in third quarter 2022. The equipment rate for car, home, health, legal, all mobile phones or personal accident insurance rose +0.6 percentage point compared with third quarter 2021 to 27.1% at end September 2022. Lastly, in October, LCL announced the launch of a 100% digital offering, LCL Essentiel Pro, with extra-banking services for self-employed professionals. CA Italia’s activity was resilient and benefited from the diversification of the Group’s activities in Italy. Gross customer capture over nine months thus reached 115,000 new customers. CA Italia’s loan outstandings at end September 2022 amounted to €59.7 billion49. They were stable compared to end September 2021, excluding the disposal of €1.5 billion in non-performing loans in fourth quarter 2021, and stable compared to second quarter 2022. The production of corporate50 and consumer51 loans was dynamic, respectively reaching +7% compared to third quarter 2021 and +28% compared to the first nine months of 2021, and +23% compared to third quarter 2021 and +31% compared to the first nine months 2021. Home loan production was resilient in a declining market in Italy, allowing CA Italia to gain market share year-on-year (6.2%52 in third quarter 2022 compared with 5.7% in third quarter 2021). Customer assets at end September 2022 amounted to €109.7 billion, down -3.3% due to a negative market effect on managed savings and a decline in on balance sheet savings despite positive inflows from individuals, professionals and private banking. For International Retail Banking excluding Italy, outstanding loans were down -4.8% at end September 2022 compared to end September 2021 and customer assets were down -2.0% over the same period. Excluding disposed entities or those held for sale53, i.e while considering Poland, Egypt and Ukraine, loans outstanding grew by +3.7% and customer assets +7.8% over the same period. In third quarter 2022, commercial activity was up sharply in Poland and Egypt compared to third quarter 2021, with a loan growth of +13.3% at constant exchange rates, especially in Poland (+12.2%) and Egypt (+16.3%), and on-balance sheet savings up by +17.2% at constant exchange rates (+16.5% in Poland and +18.7% in Egypt). The surplus of deposits over loans in Poland and Egypt amounted to €2.0 billion at 30 September 2022, and reached €2.6 billion including Ukraine. Finally, the Group continues to expand its universal customer-focused banking model in Poland. Gross customer capture amounted to 28,000 new customers in the third quarter in the country. French retail banking results In third quarter 2022, underlying revenues at LCL were stable at +0.6% compared to third quarter 2021, at €940 million. The increase in fee and commission income (+5.8%) offset the decline in the net interest margin (-4.0%) related to the hike in refinancing costs (including the end of the special interest period of Targeted Longer-Term Refinancing Operations (TLTRO) at 30 June and customer resources (notably, regulated savings). On an underlying basis, expenses excluding SRF were kept under control (+1.0% Q3/Q3) at €572 million this quarter and the underlying cost/income ratio excluding SRF was stable at 60.8%. Underlying gross operating income was stable over one year, while the cost of risk rose +31.4% to -€54 million versus a low of -€41 million recorded in Q3 2021. The coverage ratio remained high at 79.9% at end September, versus 82% at end June 2022. The non-performing loans ratio was 1.4% at end June 2022, down 0.1 percentage point compared to end June 2022. As a result, net income Group share fell -1.1% compared to third quarter 2021. Over the first nine months of 2022, LCL’s revenues rose by +4.9% versus the first nine months of 2021 to reach €2,902 million, driven by the net interest margin (+3.7%), which was supported by corporate and professional activity and, secondly, by fee and commission income (+6.3%), particularly on non-life insurance and payment instruments. Underlying cos