2012 Registration document and annual financial report - BNP Paribas

2012 REVIEW OF OPERATIONSCore business results3BELGIAN RETAIL BANKING (BRB)In millions of euros 2012 2011 2012/2011Revenues 3,328 3,238 +2.8%Operating Expenses and Dep. (2,412) (2,402) +0.4%Gross Operating Income 916 836 +9.6%Cost of Risk (157) (137) +14.6%Operating Income 759 699 +8.6%Non Operating Items 18 12 +50.0%Pre-Tax Income 777 711 +9.3%Income Attributable to Investment Solutions (66) (64) +3.1%Pre-Tax Income of Belgian Retail Banking 711 647 +9.9%Cost/Income 72.5% 74.2% -1.7 ptAllocated Equity (€bn) 3.7 3.5 +5.8%Including 100% of Belgian Private Banking for the Revenues to Pre-T ax I ncome line items.3For the whole of 2012, BRB maintained a good sales and marketingdrive. Deposits grew by 3.5% compared to last year due inparticular to growth in current accounts and savings accounts.Loans grew 3.4% (1) due in part by the growth in loans to individualcustomers (+5.5%) and to the fact that loans to SMEs held upwell. The sales and marketing drive was also reflected in thesuccessful launch of the Easy Banking offering for the iPhone,iPad and Android and in the good growth of cross-selling with CIB.Revenues (2) totalled EUR 3,328 million, up 2.1% (1) compared to 2011 dueto higher net interest income as a result of growth in volumes, despite adeceleration at the end of the year. For their part, fees were flat.Operating expenses (2) , which came to EUR 2,412 million, were down 0.3% (1) ,helping BRB continue to improve its cost/income ratio, down 1.7 points (1)to 72.5%. Gross operating income (2) thereby came to EUR 916 million, up9.0% (1) compared to 2011.The cost of risk (2) , which was 18 basis points of outstanding customerloans, remained at a moderate level. Therefore, after allocating onethirdof Belgian Private Banking’s net income to the Investment Solutionsdivision, BRB’s pre-tax income was EUR 711 million, up 8.4% (1) comparedto 2011.LUXEMBOURG RETAIL BANKINGFor the whole of 2012, outstanding loans grew by 2.4% compared to 2011,thanks to a rise in volumes in the corporate and individual customersegments with good growth in mortgages. There was also strong growthin deposits (+10.5%) due in particular to very good asset inflows fromcorporate clients. Off balance sheet savings were up significantly, drivenby increased demand for life insurance products. LRB’s revenues grewin line with volumes, the good control of operating expenses helping tosignificantly improve the cost/income ratio.PERSONAL INVESTORSFor the whole of 2012, assets under management grew by 10.7% comparedto 2011, driven by positive volume and performance effects. Depositsgrew sharply during the year, to EUR 9.1 billion (+13.3%). Revenues were,however, down due to a contraction in the brokerage business as a resultof clients’ cautious stance in an uncertain environment.ARVALFor the whole of 2012, the financed fleet grew by 1.6% compared tolast year, to 689,000 vehicles. At constant scope and exchange rates (inparticular excluding the impact of the sale of the fuel card business inthe UK in December 2011), Arval’s revenues were up slightly comparedto last year due to the fact that margins held up well.LEASING SOLUTIONSFor the whole of 2012, outstandings declined by 9.5% compared to lastyear, in line with the adaptation plan regarding the noncore portfolio. Theimpact on revenues was, however, further limited due to the selectivepolicy in terms of profitability of transactions.(1) At constant scope.(2) With 100% of Belgian Private Banking.2012 Registration document and annual financial report - BNP PARIBAS 81