2020 Universal registration document and annual financial report - BNP PARIBAS 133
32020 review of oPerations
3
Core Business results
BANCWEST
In millions of euros 2020 2019 2020/2019 Revenues 2,460 2,375 +3.6% Operating Expenses and Dep. (1,723) (1,712) +0.7% Gross Operating Income 737 663 +11.2% Cost of Risk (322) (148) n.s. Operating Income 415 515 -19.4% Non Operating Items 0 (3) -98.6% Pre-Tax Income 415 512 -19.0% Income Attributable to Wealth and Asset Management (23) (28) -19.4% Pre-Tax Income 392 484 -19.0% Cost/Income 70.0% 72.1% -2.1 pt Allocated Equity ( bn) 5.5 5.4 +0.6%
Including 100% of US Private Banking for the Revenues to Pre-tax income line items.
For the whole of 2020, BancWest maintained a good business drive and continued to support the economy in the context of the health crisis. Loans outstanding rose by 1.0%(1) compared to 2019, with a very good level of production in individual loans (+4.3% compared to 2019) and active participation in the Paycheck Protection Program (PPP), the federal small business assistance program, with close to 18,000 loans granted for a total of close to 3 billion dollars as at 31 December 2020. Deposits were up by 16.8%(1) compared to 2019 and customer deposits(2) were up strongly (+18.8%). At 16.8 billion dollars as at 31 December 2020, Private Banking assets under management were up by 7.0%(1) compared to 31 December 2019, with a strong increase in responsible savings (assets under management doubling since 31 December 2019). The number of active digital clients increased by 7% compared to 31 December 2019 and cooperation with CIB continued with an acceleration of the number of joint operations (plus de 70 operations, +25% compared to 2019) and the launch of new common products and services.
Revenues(3), at 2,460 million euros, rose by 5.2%(1) compared to 2019, due to increased volumes and a positive non-recurring item in the second
half of 2020, which was partly offset by the effect of the low-interest-rate environment and lower fees due to the health crisis.
Operating expenses(3) were up by 2.0%(1), at 1,723 million euros, as a result of business development. BancWest actively pursued cost savings and headcount reduction (-4.3% compared to 31 December 2019). The business thus generated a very positive jaws effect of 3.2 points at constant scope and exchange rates.
Gross operating income(3), at 737 million euros, thus rose by 13.5%(1) compared to 2019.
At 322 million euros, the cost of risk(3) rose strongly by 174 million euros in 2020 compared to 2019, due almost entirely to provisioning of performing loans (stages 1 and 2). It stood at 58 basis points of outstanding customer loans.
Thus, after allocating one-third of Private Banking s net income to the Wealth Management business in the United States, BancWest posted 392 million euros in pre-tax income, down by 19.0% at historical scope and exchange rates and by 16.5% at constant scope and exchange rates.
(1) At constant scope and exchange rates.
(2) Deposits excluding treasury activities.
(3) Including 100% of Private Banking in the United States.
