Baudouin Prot Bnp Paribas

30th Efma Convention: L d hi i t il fiLeadership in retail finance

13 p.m. & 14 March 2008 - Paris

Baudouin ProtChief Executive OfficerBNP Paribas

BNP Paribas Retail Strategy 1

BNP Paribas

BNP ParibasBNP Paribas

Retail Strategy in Mature Retail Strategy in Mature & Emerging countries& Emerging countries& Emerging countries& Emerging countries

Baudouin Prot

2

March, 14th 2008

The importance of retail banking & SFS in BNP Paribas’ universal bank offering

Driving organic growth through customers centricitythrough customers centricity

Comparing value creation strategies in mature & emerging marketsin mature & emerging markets

3

Retail banking & SFS The highest revenue pool from 2005 to 2015

Estimated revenue pool from 2005 to 2015 (constant $Bn)

195US

47Rest of EMEA

33China

21

Rest of APAC

30

Rest of Americas

12Europe Top5

27Japan

23AMSCAGR4,3%

340

US82

China62

Rest of APAC

47

Rest of Americas

30

Europe Top546

Rest of EMEA

41Japan

23CIBCAGR4 1%

375

US98

Europe Top5

47Japan

44China

45Rest of APAC

62

Rest of Americas

24Rest of EMEA

56

Retail

& SFS

4,1%

CAGR

Source : BCG Total = 910EMEA = Europe, Middle East & Africa

0% 20% 40% 60% 80% 100%

CAGR3,1%

Retail: 1st contributor to revenue growth with more than 40% of the revenue pool

Total 910


Emerging markets : 45% of revenue pool growth

Retail banking & SFS: a major business in BNP Paribas’ universal bank offering

Retail banking in 2007: 55% of group revenues

R t il b ki t kR t il b ki t k S i li d Fi i l S iS i li d Fi i l S i

Emerging USAIt lF

Retail banking networksRetail banking networks

Equipment Personal

Specialised Financial ServicesSpecialised Financial Services

g gmarketsUSAItalyFrance q p

SolutionsFinance

1705 branches4 mn customersNBI 2006 : € 1 Bn

740 branches4 mn customersNBI 07 : € 2 Bn

730 branches3 mn customersNBI 07 : € 2,6 Bn

2 230 branches6 mn customersNBI 07: € 5,7 Bn

• Cetelem #1 in continental Europe

• UCB #3 in France

• #2 in Europe in business equipment financing

• Top 3 in Europe in leasingleasing

• # 1 in France in leasing


A complete set-up to leverage product factories and distribution platforms

2007 results: Robust growth and market outperformance

French Retail Banking :Strong sales and marketing drive: record number of customers wonStrong sales and marketing drive: record number of customers won (230,000)and sustained growth in volumesDespite a difficult market environment, revenue growth outperforming the market, with a 1.1 pt positive jaws effect

BNL bc: 20072006

Revenues (€m)

BNL bc:Integration ahead of schedule

Robust revenue growth thanks to enhanced commercial efficiency

Strong improvement of the cost/Income ratio: from 70,6% to 66,2%

+4.4%

+7.9%2007

5,671 5,919

7,3747,955

g p , ,over one year

IFRS :Continued to pursue sustained business development in

i k t

+6.5%,

2,473 2,634

emerging marketsWon 1.5 million new customers in 2007 in the retail banking networksOpened 189 branches in 2007 Acquired in 2007 Sahara Bank in Libya and consumer lending companies in Brazil and Bulgaria FRB* BNL bc** IRFS

BancWest: good sales and marketing drive despite the downturnConsumer Finance: Growth in outstandings: +17%/2006

Equipment solutions: Good operating momentum*Including 100% of French Private Banking and excluding PEL/CEL effects (+4.1% at


Equipment solutions: Good operating momentum g (constant scope)**2006 full year pro forma; including 100% of Italian Private Banking

The importance of retail banking & SFS e po ta ce o eta ba g & S Sin BNP Paribas’ universal bank offering



7

Our priority: Organic Growthwith 4 key levers

Convergence for Growth

Best-in-class Offers

Extended distribution Cross-selling

g

Customer satisfactionOffers

• Develop /improve our • Maintain our • Sell branch banking

channelssatisfaction

• Systematic p pexisting networks competitive

advantage in our businesses

gservices to SFS customers

measurement

• Develop alternative networks

• Develop state of the art Industrial platforms

• Increase revenue per customer

• Anticipate customer needs

Share Platforms and Best Practices Share Customers knowledge


Customer Satisfactionat the heart of BNP Paribas strategy and organisation

St t f th t d t

BNP Paribas recognized know-how: anticipate customer needs

InnovationPartnerships

State-of-the-art products and services offer

Customer satisfaction

Innovation

Efficient processes Multichannel distribution

Partnerships

Efficient CRM & Marketing

A few examples of 2007 initiatives:BDMV2: enhancement of the multichannel offer (NetEpargne, NetImmo…)Roll-out of Lean Six sigma

Customer centricity,

gMobile banking: partnership with Orange


Customer centricity, a Key Success Factor for BNP Paribas

The importance of retail banking & SFS in BNP Paribas’ universal bank offering



10

Retail banking & SFS: Differentiated value creation path

2 key Development Paths :1. « Branch Banking » Model: build on networks and leverage customer base

What we bring :

2. « Specialists» Model: broad development on a proven platform of Credit products, financial services or Savings products

gProducts and sales Know-how Management / best practiceRatingB dBrand

What we seek :Access to customer BaseLocal Human ResourcesDeposits

A differentiated roll-out in mature & emerging markets


mature & emerging markets

Branch Banking in Mature markets:Implementation of the integrated model

Outperform the market Create value by applying our integrated model

French Retail Banking

Implementation of a new business model

It li t il k t W t US t il k tFrench domestic marketFBR : A model of commercial and

industrial organization

French Retail Banking

BNL bc: A strong potential of growth and restructuring, in a dynamic retail

banking marketBancWest: A significant franchise on

the world biggest market

Italian retail market Western US retail market

Private banking business model

Innovation

Multi-channel C lli

Roll-out of BNPP’s integrated model

« Bear Plan »

Revitalize BancWest network

“Business Centers” modelBe ahead on the internet:

Netepargne, Netcredit Immo

Cross-sellingProduct innovationEfficiency improvement

Retail Banking InitiativeCommercial Banking InitiativeModernization of the branches

Example : Corporate customers

BNPP’s integrated model. Strengthen cross-selling

Accelerate the integration plan F lid i

Strengthen our competitive position

Strengthen the cross selling

Increase # products by customersWith the rest of the group : customers

FRB * {CIB, AMS, IRFS}Future consolidation: opportunism and pragmatism

Maintain commercial outperformance Leverage the commercial

g pCIB: ECEP, syndicationAMS: InsuranceIRFS: Leasing


Maintain commercial outperformance, and preserve significant jaws effect

Leverage the commercial momentum Priority to organic growth

Adaptation of our SFS business models

EQUIPMENT SOLUTIONSPERSONAL FINANCE

Grouping of Arval and BPLGShare know-how

Merger of Cetelem and UCBDevelop direct channels and Share know how

Increase international development

pincrease production via internetIncreased exposure to emerging markets

An integrated value creation model

A powerful client acquisition engine leveraging branch networks with specialised finance businesses

A systematic and large scale industrial model


A systematic and large-scale industrial model

An absolute prerequisite: Keep on improving our operational efficiency

Rationalization of networks • Centralization of back offices and branches• Lean organization in Front office• More Automation : " more time for sale " • Master plan OAV (FRB)

Process OptimizationReorganization of functions

& Business linesp• Roll out of Lean 6 sygma / ACE• Optimization of procurement • Focus on the real-estate and IT

• Reorganization of functions• Creation of Personal Finance and Equipment Solutions • Optimization of set-ups (one umbrella in Russia, one single Treasury, Cetelem / Cofinoga)

IT : Constitution of common platformsConstitution of common platforms Sharing of developments


Emerging countries: two differentiated approaches to increase group exposure

Mediterranean zone and Eastern EuropeDensification of existing franchises

Development of cross-selling

Brazil - India - ChinaActive growth strategy driven

by a system of sponsoring% f10% of the global revenue pool growth

2006-201020% of the global revenue pool growth

2006-2010

Organic growth strengthened by targeted acquisitions in the Mediterranean zone

d i E t E

Coordinated Strategy and adaptation of the BNP PARIBAS integrated model in l i t iand in Eastern Europe

Open 600 branches by 2010 to bring the total branch network to 2,600Win over 6 million new customers in the retail banking networks by 2010

large emerging countries: " retail light " experiment in Brazil, capitalizing on the presence of Personal FinanceIndustrial Partnerships


banking networks by 2010Grow revenues per customer

Coordination of the Group strategy by a sponsor member of the Executive Committee

BNP Paribas targets for Retail Businesses

Estimation of annual evolution of revenues and jaws effect from 2008 to 2010

10%

Revenues Jaws effects

j

6%5%

4%

1%

5%

1%

FRB BNL bc IRFS

Ambitious targets for 2010


Conclusion

Priority to organic growth with targeted acquisition policywith targeted acquisition policy

In mature countries, leveraging our integrated business model

Acceleration of growth Acceleration of growth in emerging markets

Focus on operational efficiency to increase jaws effects in all retail businesses


to increase jaws effects in all retail businesses