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Management’s discussion and analysis
Excluding the effect of changes in
exchange rates and in the price of
precious metals used in the manufacture
of exhaust systems, year-on-year sales
growth came to 9.3%. This performance,
achieved in a year when automobile
production in Europe contracted by an
estimated 2%, reflected a further increase
in Faurecia’s penetration rate among its
main customers and the success of
automobile models equipped with
Faurecia products. It built on a 64.6%
rise in sales in 2001, including the
contribution of the Sommer Allibert
automobile business from January 2001,
and a 14.5% increase in comparable sales.
2.3. Finance company revenues
In 2002, new retail financing was
provided for 803,500 Peugeot and Citroën
vehicles, compared with 801,100 vehicles
the previous year. New vehicle retail
financing edged up 0.5% to 622,800 units,
slightly exceeding the rate of growth in
Group registrations in Europe where
Banque PSA Finance carries out the bulk
of its lending activities. The finance
companies provided financing for 25.3%
of the Peugeot and Citroën vehicles sold
during the year, the same penetration rate
as in 2001. The volume of used vehicle
financing granted during the year
declined 0.4% to 180,700 units, reflecting
the finance companies’ selective approach
designed to preserve the low risk profile
of the loan portfolio.
In 2001, new retail financing was provided
for 801,100 vehicles, an increase of 13.9%
on the previous year. Financing volumes
rose 17.7% for new vehicles and 2.6% for
used vehicles.
As of December 31, 2002, outstanding
loans stood at €18,687 million, including
securitized loans which have been removed
from Banque PSA Finance’s balance sheet.
In June 2001, Crédipar, the Bank’s French
subsidiary, sold €1,000 million worth of
automobile loans to a special purpose
entity which in turn issued asset-backed
securities to international institutional
investors. The asset pool has been kept at
this level since June 2001, through the
sale of new automobile loans to replace
the original loans when they reach
maturity. In July 2002, Crédipar and
Banque PSA Finance’s spanish branch sold
€1,500 million worth of automobile loans
to the special purpose entity. The asset
pool is regularly topped up in the same
way as for the first securitization. As
a result of these top-up sales, as of
December 31, 2002, automobile loans
totaling €2,500 million were securitized.
These securitization operations form part
of the financing strategy of the Group and
Banque PSA Finance (see Group Financing,
1. Financing strategy).
Outstanding loans, including securitized
loans, at December 31, 2002 were 8.6%
above the year-earlier total of €17,215
million, which in turn was 17.3% above
the year-end 2000 figure. As shown in the
following table, growth over the threeyear
period was primarily driven by strong
sales of retail and lease financing.
(in millions of euros) Dec. 31, 2002 Dec. 31, 2001 Dec. 31, 2000
Outstanding loans, including securitized loans
- Retail and lease financing 13,878 12,863 10,857
- Wholesale financing 4,809 4,352 3,822
Total Banque PSA Finance 18,687 17,215 14,679
After deducting automobile loans sold under the two securitization programs described above, year-on-year increases were as follows:
(in millions of euros) Dec. 31, 2002 Dec. 31, 2001 Dec. 31, 2000
Outstanding loans, excluding securitized loans
- Retail and lease financing 11,378 11,863 10,857
- Wholesale financing 4,809 4,352 3,822
Total Banque PSA Finance 16,187 16,215 14,679
Financing revenues from loans carried
on Banque PSA Finance’s balance sheet
correspond to gross interest income on
the loans. For the securitized loans
removed from the balance sheet,
financing revenues correspond to
revenues on the Bank’s retained interest,
i.e. interest income net of financing costs
and credit losses. Total financing
revenues also include interest earned on
the permanent cash reserves carried in
Banque PSA Finance’s balance sheet as
part of the financing strategy described
below (see Group Financing, 1. Financing
strategy).
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