Simplifi ed Organization Chart of Natixis 8 2009 KEY FIGURES 9
a The underlying principles of the BPCE, the central institution of Groupe BPCE created by Law No 2009-715 of June 18, 2009, were approved on June 24, 2009 by the BFBP Board of Directors of the CNCE Supervisory Board. The last step in the formation of Groupe BPCE was realized on July 31, 2009 with the votes at the General Shareholders’ Meetings of BFBP, CNCE and BPCE.
Investment solutions , by uniting deposit products, will be in a position to increase the synergies between its three activities (asset management, insurance, private banking) and the Groupe BPCE networks. The acquisition of the CNP minority holding in Natixis Global Asset Management (NGAM) was successfully completed and the restructure of the private banking activities around Banque Privée 1818 was launched.
(a) Calculated on the average number of shares (excluding treasury shares) during the period.
Chairman of the BPCE Executive Board 50, avenue Pierre-Mendès France 75201 Paris cedex 13
Mr. Olivier Klein Date of birth: 06.15.1957 Natixis shares held: 1,000
Chief Executive Offi cer First appointed: Board Meeting of 04.30.2009, effective May 14, 2009. Term expires: 05.14.2015 (a)
Members’ attendance rate was over 78% for the year as a whole.
If proposed by the CEO, the Board of Directors may appoint one to fi ve individuals, selected from among the directors or outside their ranks, who shall assist the CEO and have the title of Deputy CEO.
During the various meetings, the Executive Board regularly examined the development of Company activities and the trends in its results. It focused, in particular, on managing the repercussions of the fi nancial crisis and ensuring that the banks’ balance sheet was well structured, in particular, by reducing weighted risks.
The Executive Board examined and approved policies for determining variable compensation for the bank’s CIB activities for 2008.
The Executive Management Board also supervised Natixis business restructuring projects, in particular, the merging of Private Banking business, or operations of a similar nature, with the Groupe BPCE . It was also kept up to speed on the progress of plans to set up a single Group payments operator. The Executive Management Board approved procedures to transfer Natixis Pramex International and Natixis Algérie to BPCE, as well as the terms and conditions for the purchase of the 11.34% holding in Natixis Global Asset management held by CE Participations. The Executive Management Board was also consulted on the main choices of fi nancial policy.
A – Compensation and benefi ts of all kinds for the Chairman of the Supervisory Board (until April 30, 2009) and of the Board of Directors (from April 30, 2009)
Philippe Dupont was not paid any variable compensation in relation to his duties as Chairman of the Executive Board over the period in question.
Philippe Dupont is a benefi ciary of this plan in relation to his activities with BFBP and, as a result, is not eligible for all of the plan’s provisions in relation to Natixis.
Over the period between January 1 – April 30, 2009, members of the Executive Board (i.e. Messrs. Dupont, Ferrero and Moriani) did not receive severance payments in relation to their corporate duties at Natixis or at its subsidiaries.
Jean-Marc Moriani (“temporary” CEO from April 30, 2009 to May 13, 2009 - term of offi ce ending on May 13, 2009)
In addition, members of the Board of Directors do not benefi t from severance payments in relation to their function with Natixis.
Philippe Dupont, Chairman of the Executive Board (term of offi ce ending on 03.02.2009) n/a €0 a in relation to his duties at Natixis n/a €0 a in relation to his duties at BFBP n/a €0
(c) Jean-Marc Moriani has continued to give the Company the exclusive benefi t of his skills and remained an employee of Natixis receiving gross monthly compensation of €83,333.
(d) The fi xed compensation paid to Jean-Marc Moriani in relation to his duties over the period was €262,529 gross, including an adjustment of €175,862 gross in 2009, for 2008.
In relation to Natixis subsidiaries 18,400 (d) 11,800 9,800 10,800 (b)
Straight fi nancing, domestic and international fl ow management, and merger and acquisition advisory
a Structured Export Finance (SEF) advises on and structures international contract financing covered by export credit agencies (ECA), private insurers and any other scheme used to weight credit and country risk. The department originates on behalf of major exporters, banks, financial institutions and sovereigns, in its offices in Paris, Milan, Madrid, Frankfurt, Singapore, Shanghai, Beijing, Hong Kong and Sao Paulo. In 2009, SEF was involved in about 30 high-profile deals.
Lastly, the publication of the European Directive defi ning the future principles for the evaluation and control of the solvency of insurance companies has added a new plank to the prudential framework, which will be applicable as of December 31, 2012. In 2009, Natixis Insurance continued efforts begun in earlier years to measure the impact of the new standards, and launched a business project aimed at adapting its governance and steering system in line with future prudential requirements. 2010 will be another decisive year for the modeling and adaptation of its procedures.
With €14.6 billion of assets under management at the end of 2009, Natixis’ Private Banking business aims to boost infl ows by capitalizing on growth in the High Net Worth Individuals market in Europe and drawing on the strong potential of the Banque Populaire and Caisse d’Epargne networks.
J CHANGE IN PRODUCTIVE ASSETS AT NATIXIS LEASE (in millions of euros)
Thanks to partnerships with mutual guarantee companies (Socama) and the European Investment Fund, the Banques Populaires offer business founders and buyers loans without a personal surety. More than 28,000 Socama loans were distributed in 2009 for an amount totaling €765 million.
Caisse d’Epargne supports each of its clients in all of their projects: retail banking serves private individuals and professional customers, while the regional development bank serves public and private players in the French economy.
This growth principally benefi ted the top-end Nuances Privilèges contract offered by Ecureuil Vie (+39%) and the wealth management offering of Banque Privée 1818.
Caisse d’Epargne provides free of charge to each of France’s 37,000 districts and 2,600 communities a personalized socioeconomic and fi nancial analysis and a reference document to facilitate debates on budgetary issues. Thanks to a large number of dedicated tools, Caisse d’Epargne helps decisionmakers of territorial public institutions and local authorities anticipate issues, obtain information and exchange ideas.
This allowed them to increase fi nancing of existing social housing, whose development and renovation is supported by public policies.
ACTIVITIES 3 Support functions of operations and Human Resources in each business line, training staff have developed their advisory role and proposed educational solutions tailored to the needs identifi ed over the course of the year.
Over and above these rules, and in view of the context, the Management Committee, in agreement with the Supervisory Board, has decided that all variable compensation above €5,000 in all Natixis’ business lines and support positions will be frozen and paid under the condition of Natixis’ fi nancial recovery in the fi rst quarter of 2010. This measure will make it possible to link the payment of variable compensation to three consecutive quarters of positive results and a full year of profi ts (from March 31, 2009 to March 31, 2010). Only variable compensations of less than €5,000 were paid at the end of March 2009.
To help the Corporate and Investment Banking division with the challenges it faces, the Human Resources Department will propose tailoring its policies to all businesses and regions with the help of Human Resources teams close to each business line, specifi c resource management processes and the development of an international HR network.
It will also ensure the implementation of new compensation rules for market professionals, seek to foster internal expertise (international mobility, compensation and legal advice) and assist with necessary reorganizations.
j 168 students who opted to prepare for a 2-year or 4/5year university sandwich course were able to benefi t from a practical training program within Natixis.
With “business information and ratings”, companies can learn about commercial opportunities, assess the financial soundness their partners and check their partners’ ability to fulfill their commitments.
a The sale of the 15% interest in Cerved, the Italian market leader in IT, which was acquired in December 2006, generated a capital gain of €20 million in the first quarter of 2009. Other shareholders wished to sell and it was not possible to integrate this company within Coface.
a Natixis Private Equity supports and finances funds from their creation with the help of Natixis for which it is the principal underwriter together with third-party investors. Natixis Private Equity has €2.2 billion of its own capital tied up in these funds.
Losses on the GAPC credit portfolio signifi cantly impacted the Company’s results both in 2008 and in the fi rst half of 2009 (pre-tax loss of €3.0 billion) and inevitably weighed down its stock-market performance. It should be noted that the value of the Company’s stock at June 30, 2009 had fallen by close to 40% since the September 2008 capital increase and by 90%
All the terms and conditions of the Guarantee are set out in the upcoming agreements between the Company and BPCE.
In absolute terms and subject to all the foregoing, we feel that as at the date of coming into force of the Guarantee, namely July 1, 2009, the terms of the agreements constituting the safeguard mechanism for the GAPC assets are reasonable and balanced and hence fair from a fi nancial perspective for the Company.
Signatory to the United Nations Global Compact since July 2007, Natixis has undertaken to support and apply its fundamental principles in the areas of human rights, workplace and environmental standards and the fi ght against corruption.
With respect to the situation of women within the group, they represent 45% of the total workforce of Natixis
In addition to maintaining disabled persons in employment, the focus will be on identifying possible recruitment paths within the different business lines of Natixis. A partnership has been concluded between the “Tremplin” association and our Asset
The “France” scope did not change a great deal in 2009. The main events affecting its scope in 2009 were: a the exit of Natixis Développement Maintenance Logiciel; a the merger of Banque Privée Saint Dominique and Compagnie 1818 Banque Privée resulting in the creation of Banque Privée 1818; a in the “Private Equity” scope: the creation of Kurma Life Sciences Partners; and a in the “Asset Management” scope: the creation of Natixis Asset Management Finance and the transfer of staff from Natixis Asset Management to Natixis Global Asset Management (France), Natixis Global Associates International (France) and Natixis Asset Management Finance.
2. Regarding Natixis S.A., external recruitments contracted very sharply during 2009 to a total of 231 persons (- 40% vs. 2008). The percentage of managers remained high at 79%.
The average resignation rate among permanent employees was 1.6% (3.7% in 2008).
J BREAKDOWN OF DEPARTURES PER AGE BRACKET 2009 years years years years years years 56 years and over
More than 7,700 employees of Natixis S.A. and of seven other legal entities each received an individual “social audit”, a document detailing their fi xed remuneration, statutory benefi ts, variable remuneration, savings accumulated in the employees savings plans, as well as the benefi ts provided by the Company in terms of social protection (provident insurance, complementary health insurance, retirement benefi ts) and providing a breakdown of other benefi ts (training, works council, family allowances, etc.).
These provisions enable the group’s central works council and locally-based works councils to offer all staff a range of social, cultural and recreational activities.
In addition, a 50/50 team representing the Company’s management and subscriber representatives manages Natixis’ complementary health insurance plan, the Mutuelle de Natixis, one of whose founding principles is inter-generational solidarity between active and retired employees.
The indicators used are the indicators required under Articles L.225-102-1 and R.225-104 and R.225-105 of the French Commercial Code. Correspondence to indicators defi ned in the GRI 3 reference document (Global reporting initiative - a set of international standards relating to good sustainable development practices) is indicated in brackets.
Natixis’ energy and fl uid consumption is managed by the logistics department. Its policy is to minimize the direct environmental impacts of the Company’s operations, while maintaining a high standard of working conditions for employees. In an effort to strike the right balance, Natixis sets qualitative and quantitative consumption targets for individual buildings on an annual basis.
Collection points in the lobbies of buildings. Collection, transportation and treatment by an external service provider approved in accordance with legislation. 1,200 kg 1,040 kg
Risks related to the links with BPCE and the Banques Populaires and Caisses d’Epargne networks 133
In the event of the implementations of these repurchases of holdings under the approval procedure or by compulsory repurchase, Natixis would no longer have any fi nancial interest in the results of the Banques Populaires or Caisses d’Epargne bank, or banks, concerned, and its ability to sell products and services through the Banques Populaires or Caisses d’Epargne bank, or banks concerned, could be impacted.
A market downturn, such as that recently observed, is likely to lead to a decline in the volume of transactions that Natixis executes for its customers and as a market maker, and, therefore, to a decline in its net banking income from these operations. In addition, as management fees that Natixis charges its customers’ portfolios are in many cases based on the value or performance of the portfolios, any market downturn that reduces the value of these portfolios or increases the amount of withdrawals would reduce the revenues Natixis receives from its asset management and private banking businesses.
End-of-period risk-weighted assets, taking into account the impact of the guarantee, were cut by 20% to €130.9 billion at December 31, 2009, compared with €163.1 billion at end December 2008. This breaks down as €106.9 billion in credit risk, €18.8 billion in market risk and €5.2 billion in operational risk.
Other operating expenses fell by €32 million (-2%) thanks to further determined action to cut costs in 2009.
The Commodities business increased its NBI by 33% over the year.
The cost of risk remained abnormally high in 2009, although it was down signifi cantly year-on-year (-53%). After the impact of the fi nancial crisis in 2008, the division’s cost of risk was mainly affected by the Private Banking business line with a loss in the portfolio in Luxembourg and the appearance of an identifi ed risk on client loans in France.
a The breakdown of assets under management in North America at end December 2009 reveals a higher proportion of fixed-income products (+2.5%), a reduction in the proportion of alternative (-1.6%) and money-market (-1.1%) products and stability in equity products.
Aggregate Private Banking NBI was €81.8 million, down 26% (€28.4 million) compared with 2008.
Payments a Factoring suffered from the impact of slower economic activity, low short-term interest rates and the fall in volumes consecutive to the reduction in payment terms (economic modernization law).
The cost of risk was €46.7 million at end December 2009, up €18.7 million due to the impact of the depressed economic environment on the Specialized Financing business line.
2009 should be analyzed in two parts: the fi rst half accounted for most of the losses for the year, while the second-half results benefi ted from the BPCE guarantee. The GAPC’s income before tax was €75 million in the second half, after taking into account a €19.4 million expense relative to the guarantee.
Advanced rating models are used for sovereigns and major counterparties (OECD banks and large corporate entities with consolidated revenue of more than €1 billion).
Collateral and set-off agreements give rise to: a an analysis, when a loan application is approved or reviewed, aimed at assessing the suitability of the instrument or guarantee provided and the reduction in risk it confers; a verification, processing and documentation work based on the use of standard contracts or contracts approved by the Legal Department; a registration and monitoring procedures in administrative and risk management procedures.
All risk-reduction techniques are verifi ed during preparatory work carried out to calculate regulatory capital requirements.
Loans and receivables to banks 68,653 283 (259) * 68,677 65,573
Breakdown of exposure at risk by internal rating (S&P equivalent) for asset classes calculated using the IRB approach (sovereigns, banks and corporate entities), after excluding: a specialized financing (calculated using slotting criteria, i.e. weighting on the basis of the internal ratings for the transaction and not the counterparty); a exposure to equities (calculated using a simple weighting); a pool-based exposure (acquired portfolios); a accounting adjustments.
Contracts including margin calls * After the application of netting agreements.
FINANCIAL DATA6 Management Report 5.5 - Overall interest rate, liquidity and structural foreign exchange risk
Liquidity risk is the risk of not being able to honor commitments to creditors due to the mismatching of maturities between assets and liabilities. As a corporate and investment bank,
Natixis’ liquidity risk results primarily from mismatching positions on transactions with contractual maturities. Natixis does not have stable and permanent customer resources and refi nances almost exclusively in the capital markets.
The department publishes monthly reports on Natixis’ operational risks. These reports set out the operational losses incurred by Natixis (by number and amount), in aggregate terms and by division, over the previous month and since the beginning of the year. They also provide a detailed analysis of serious incidents by division.
Early in 2009, Natixis recorded an incident involving an operating loss of €475 million related to its customers’ exposure following the Madoff fraud. Natixis’ Internal Audit Department was given responsibility for investigating this incident.
All the insurance policies mentioned above were taken out with insurance companies deemed by the market to be solvent.
Natixis has not been accused of any wrongdoing in the CIC group’s complaint, whether with respect to the execution of the contracts or their performance. The legal arguments used by the Crédit Mutuel Group to challenge the validity of its purchases of EADS shares appear to be without merit.
Traditionally, Coface distinguishes between frequency risk and event risk: a frequency risk represents the risk of a sudden and significant increase in delinquency from a multitude of debtors. This risk is measured for each entity by monitoring the loss ratio (ratio between claims and premiums) by business sector (domestic credit), by country (export credit), or by product line (deposit, single risks). Loss ratios for the various underwriting centers are also monitored at the consolidated Coface level, as are the amounts and monthly numbers concerning delinquency; a event risk represents the risk of abnormally high losses recorded for the same debtor or group of debtors, or of an accumulation of losses for the same country.
Natixis also raised, via its EMTN programs and interbank deposits, the equivalent of €4.2 billion in the capital markets.
The estimated amount of the capital loss attributable to the divestment was the object of a €35 million provision in the 2009 fi nancial statements, including €8.6 million in goodwill impairment on the divested entities.
8.3 - Reimbursement of the entire shareholder advance made by BPCE
Consolidated net income/(loss) – group share – per share, calculated on the basis of the average number of shares over the period excluding treasury shares 5.24 (0.60) (1.57)
= Total non-cash items included in income/(loss) before tax and other adjustments (5,487) (1,302)
As required by European regulation 1606/2002 of July 19, 2002, Natixis has prepared its consolidated fi nancial statements for the year ended December 31, 2009 in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union at that date (1). These standards include IAS 1 to 41, IFRS 1 to 8 and the related IFRIC interpretations adopted by the European Union as at December 31, 2009.
Companies controlled by Natixis are fully consolidated. Under IAS 27, control is presumed to exist when the parent has: a ownership, directly or indirectly through subsidiaries, of more than half of the voting rights of an entity; a power to govern the financial and operating policies of the entity under the bylaws or an agreement;
Changes to the operational structure of Natixis’ businesses described in Note 9 necessitated modifi cations to the composition of the CGUs, and consequently a reallocation of goodwill.
Insurance Company investments are classifi ed in the balance sheet under the various categories of investments defi ned in IAS 39.
The main events during the year were as follows: MERGER OF BANQUE PRIVÉE SAINT-DOMINIQUE AND OF COMPAGNIE 1818 - BANQUIERS PRIVÉS
In parallel, the two asset management companies, subsidiaries of the two banks, BPSD Gestion and Compagnie 1818 Gestion merged to form 1818 Gestion.
Acting as manager of the management company does not in itself transfer the majority of a fund’s risks and benefi ts to the NGAM sub-group. In fact, the management company does not guarantee and is not exposed to risk in respect of the fund’s assets and any provision for profi t-sharing with the management company only applies to a small part of the gains. NGAM’s compensation as fund manager is marginal compared to the returns generated for investors.
* In early 2010, negotiations were entered into to dispose of these entities (see Note 14).
FINANCIAL DATA 6 Consolidated fi nancial statements and notes // Notes to the consolidated accounts a Natixis controls a certain number of SPEs designed to own or lease real estate assets intended to be re-let or otherwise made available to other Group subsidiaries or third parties. Such SPEs are consolidated once Natixis has a majority interest in these vehicles and where they are material to the consolidated financial statements. Three SPEs meet these criteria and were thus consolidated as of December 31, 2009: j Natixis Immo Exploitation; j SCI Altaïr 1; j SCI Altaïr 2.
Natixis is mainly involved in structures employing securitization entities in its capacity as: a structurer of securitization transactions; a originator of securities or loans held as assets and awaiting securitization; a credit risk intermediary between the market and the securitization entity.
Gains or losses arising from changes in the fair value (excluding income) of available-for-sale fi nancial assets that are not hedged are recognized directly in equity under “unrealized or deferred gains or losses”. Accrued or earned income is recognized in the income statement under “interest and similar income” using the effective interest rate method. Available-for-sale fi nancial assets are tested for impairment at each reporting date. When there is objective evidence that an asset is impaired and a decline in the fair value has already been recognized directly in equity, the cumulative impairment loss is removed from equity and taken to income under cost of risk (fi xed-income securities) or net banking income (variable-income securities).
Non-monetary items denominated in foreign currencies and measured at fair value are translated at the exchange rate when fair value is estimated. Gain or losses on a non-monetary item (e.g., variable-income securities) denominated in foreign currency is recognized as income when the asset is classifi ed as “Financial assets at fair value through profi t and loss” and in equity when the asset is classifi ed as “Available-for-sale fi nancial assets”, unless the fi nancial asset is designated as a hedged item in a fair value hedge, in which case foreign exchange gains and losses are recorded as income.
Assets and liabilities relating to discontinued operations are accounted for in the balance sheet in the same way as disposal groups held for sale. Gains or losses from these operations are presented on a separate line of the income statement and include the post-tax gain or loss resulting from operations discontinued before disposal and from the sale or valuation of assets or disposal groups held for sale at fair value less costs to sell.
Under IFRS 2 “Share-based Payments”, employee bonus share awards give rise to an expense representing the fair value of the goods or services received at the grant date. This payroll expense is recognized against equity. The fair value of the
At December 31, 2009, Natixis had not purchased credit protection for credit risk arising on loans and receivables designated at fair value through profi t and loss.
(a) The cumulative fair value recognized in respect of the issuer spread on debt issued by Natixis amounted to €415.5 million at December 31, 2009, versus €663.6 million at December 31, 2008 (see Note 7.3). This refl ects changes in the spread for Natixis since second-half 2009.
(a) Natixis has contracted Total Return Swaps (TRS) with BPCE. These instruments are used to hedge changes in the fair value of GAPC instruments carried at fair value through profi t and loss as at July 1, 2009. TRSs included on this line at December 31, 2009 amount to €343 million within assets and €591 million within liabilities.
FINANCIAL DATA6 Consolidated fi nancial statements and notes // Notes to the consolidated accounts 6.4.1.1 Performing loans to banks
CMBS were reclassifi ed from level 1 to level 3 after a valuation model was introduced in 2009 (see Note 5.6).
S ensitivity of the fair value of fi nancial instruments measured using unobservable inputs was estimated at December 31, 2009. The estimate was based on: a a “standardized” (1) variation in unobservable inputs for interest rate and equity instruments. The resulting sensitivity was + or -€11.7 million; a a flat variation of: j 10% in the estimated loss rates on underlying assets to model the valuation of ABS CDO tranches, or j 1% for underlying assets in CMBS and CLOs, representing a sensitivity impact of + or -€110 million (2).
See Note 2 “Consolidation methods and principles” and Note 9 “Segment information”.
Debt securities (interest-bearing notes, inter-bank market securities, etc.) are broken down by nature, excluding subordinated securities which are included within “Subordinated debt”.
FINANCIAL DATA 6 Consolidated fi nancial statements and notes // Notes to the consolidated accounts 6.15.2 - PROVISIONS FOR RISKS AND OTHER COSTS
Subordinated debt differs from advances and bonds issued in that it will be repaid after all senior and unsecured creditors, but before the repayment of participating loans and securities and deeply subordinated securities. Subordinated debt is valued at amortized cost.
The fi nancing from which Natixis indirectly benefi ts through its core shareholder BPCE under the fi nancial sector bail-out plan approved by the European Commission is described in Note 5.16.
FINANCIAL DATA6 Consolidated fi nancial statements and notes // Notes to the consolidated accounts 7.1 - Interest margin
“Interest and similar income” and “interest and similar expenses” comprise interest on fi xed-income securities recognized as available-for-sale fi nancial assets, and interest on loans and receivables to and from banks and customers.
Impairment of fi xed-income securities is charged to cost of risk.
This item mainly comprises the cost of risk arising on credit transactions: net charges to specifi c and collective provisions, loans and receivables written off during the period and recoveries on bad debts written off.
Loans and receivables to fi nancial institutions 57,968 695 2,696 171 60 352 3,631 65,573
This compensation will only be payable provided the potential benefi ciaries have met specifi c presence conditions and performance criteria.
Under defi ned contribution plans, Natixis pays fi xed contributions into a separate entity and has no obligation to pay further contributions.
Post-employment defi ned benefi t plans include all postemployment benefi ts for which Natixis has committed to pay a specifi ed level of benefi ts. These plans include banking sector top-up pension plans, end-of-career awards, mutual health insurance funds and other contractual benefi ts accruing to retirees.
a November 12, 2009: vesting of the shares provided that employees are still with the Group, and start of the two-year lock-up period. At the start of this period, each beneficiary in employment receives his or her shares, which are placed in a registered account or employee investment trust for a lock-up period of two years. Employees therefore become the owners of their shares at the start of this lock-up period. They are entitled to dividends, but may not sell their shares.
This decision was embodied in a regulated agreement which was approved by shareholders at Natixis’ General Shareholders’ Meeting of April 30, 2009.
a Deloitte & Associés – 185 avenue Charles-de-Gaulle – 92524 Neuilly-sur-Seine Cedex; a Salustro Reydel, member of KPMG International – 1 cours Valmy – 92923 Paris La Défense Cedex; a Mazars – Immeuble Exaltis 61 rue Henri-Régnault – 92075 La Défense Cedex.
AEW SENIOR HOUSING INVESTORS INC. (5) Asset Management FC 100 100 0 0 USA
AEW VIA INVESTORS LTD Asset Management FC 100 100 89 89 USA
ASAHI NVEST INVESTMENT ADVISORY CO, LTD Distribution EM 49 49 49 43 Japan
ASG LASER FUND (1) Asset Management FC 69 69 89 89 USA
ASG GLOBAL ALTERNATIVES FUND (1) (20) Asset Management 0 0 89 89 USA
ABSOLUTE ASIA AM Asset Management FC 100 100 89 89 Singapore
NATIXIS GLOBAL ASSET MANAGEMENT PARTICIPATIONS 3 Holding company FC 100 100 89 89 France
NATIXIS ASG HOLDINGS INC (EX-NATIXIS GLOBAL ASSOCIATES, INC.) * Distribution FC 100 100 89 89 USA
NATIXIS FINANCEMENT ** Consumer loans FC 67 67 67 67 France
COFACE NORTH AMERICA HOLDING COMPANY Holding company FC 100 100 100 100 United States
COFACE DANMARK - SUCC (COFACE KREDIT) Insurance FC 100 100 100 100 Denmark
CAISSE D’EPARGNE NORMANDIE (ex -Caisse d’E pargne de B asse-N ormandie ) *
(20) Exit on September 30, 2009 when it became minority shareholder in the Fund.
The Group recognizes impairment losses against availablefor -sale fi nancial assets when there is objective evidence that such assets have suffered a prolonged or signifi cant decline in value (Notes 5.1, 6.3, 7.4 and 7.7 to the consolidated financial statements). We examined the control procedures relating to the identifi cation of evidence of impairment and measurement of the largest impairment losses, as well as the estimates made in recognizing impairment losses to cover the decline in value of these assets where applicable.
We have nothing to report regarding the fairness of this information or its consistency with the consolidated fi nancial statements.
Liabilities 14 Due to central banks 208 653 1,405 23 o/w institutional operations 1 18 Provisions for risks and other costs 3,208 3,427 2,019
In accordance with banking regulations: a accrued interest due on loans to borrowers subject to legal proceedings is deducted from the interest account in which it was initially recorded. If the interest is subsequently recovered, it is credited to this line upon collection; a interest on non-performing loans three, or where applicable, six or nine months overdue is also written down in full by deduction from the interest account in which it was initially recorded; a all other loans made to these customers are automatically also classified as non-performing, even when the risk appraisal does not require an impairment charge against the outstanding principal.
Purchased software is amortized on a straight-line basis over its estimated useful life, which in most cases is less than 5 years. Internally generated software is amortized over its estimated useful life, which cannot exceed 15 years.
We performed the procedures that we considered necessary in accordance with the professional standards issued by the French Statutory Auditors’ Board (Compagnie nationale des commissaires aux comptes – CNCC). Those procedures involved ensuring that the information disclosed to us was consistent with the source documents from which it was taken.
1.3 - Agreements relating to shareholder advances between Natixis and CNCE and BFBP, respectively
1.6 - Agreement between Natixis and BPCE regarding the purchase of securities and the issue and subscription of perpetual deeply subordinated bonds
FINANCIAl DATA6 Statutory Auditors’ special report on related party agreements and commitments
2 - AGREEMENTS AND COMMITMENTS APPROVED IN PRIOR FISCAL YEARS AND STILL IN EFFECT DURING THE YEAR
On May 30, 2007, the Supervisory Board approved the provisions of an invoicing agreement regarding the affi liation of Natixis to BFBP and CNCE, setting the contribution paid by Natixis at €10,000,000, representing €5,000,000 for each central institution, with annual indexing based on objective criteria.
The IT Systems Security (ITSS) Department guarantees the security of IT systems and business continuity within Natixis. It is also responsible to the Executive Management for implementing the IT security policy for which it ensures the defi nition, control and maintenance.
Natixis’ Head of ITSS manages the IT System Security Department. He/she is assisted by a head of IT Systems Security dedicated to the CIB (who reports to him/her). There is a total of 65 employees in this fi eld in Natixis .
Provisions Committee Meetings are held quarterly for each sector. They review all cases whose development are liable to give rise to provisions or adjustments to existing provisions, and decide on the level of provision necessary.
Global reporting of risks is distributed daily, to Executive Management, BPCE and front offi ce managers. The Risk Department proposes global limits and main standards and procedures for approval by Natixis’ General Risk Committee.
Committee chaired by the Chief Executive Offi cer and attended by members of the Corporate and Investment Banking division, the Finance and Risk Department and BPCE. This general Committee meets once a quarter and its main responsibilities are: a validation of the main rules for asset and liability management (including those relating to internal liquidity pricing), agreements, indicators and limits for monitoring, the management and supervision of balance sheet structural risks, and this in liaison with the standard ALM framework set up by BPCE; a validation of the overall funding policy; a monitoring of the major balance sheet balances and their evolution; and a monitoring structural balance sheet risks and compliance with limits.
Natixis’ risk of structural change for the most part concerns the structural positions in the US dollar due to presence of foreign branches and subsidiaries funded in this currency in its consolidation scope. Given the presence of weighted risks denominated in currencies other than the euro (in particular the US dollar), the ALM Committee has approved currency purchases to fund long-term investments in order to quarantine the bank’s capital-adequacy ratio against change in the euro-US dollar exchange rate.
Ownership of shares by members of management and supervisory bodies 460
Resolution Six (Ratification of the co-opting of Alain Lemaire as Director)
(iv) the approval of the General Shareholders’ Meeting of Natixis Securities of the financial statements of Natixis Securities for the year ended December 31, 2009; a it being added that: (i) given that the Company holds all the shares in Natixis Securities (and having undertaken to retain them until the definitive completion of the merger), according to Article L.236-6 of the French Commercial Code, said shares in Natixis Securities shall not be swapped for new shares in the Company, with the latter as a result not carrying out any capital increase and with the Natixis Securities shares being unconditionally canceled,
LEGAL INFORMATION 8 Draft resolutions for the Combined General Shareholders’ Meeting of May 27, 2010 2. fully empowers the Board of Directors, with the right to further delegate in the manner provided by law, to carry out one or more capital reduction(s), to accordingly amend the bylaws, as well as to carry out all related disclosures, publications, filings and formalities and, generally speaking, do whatever is necessary.
The Board of Directors may, by proposal of the Chairman, elect one or several Vice-Chairman (men) among its members.
Subject to an emergency such as defi ned below and the case referred to in Article 14 below, the Board of Directors must be convened with reasonable notice prior to the scheduled date of the meeting. Notices of meetings shall include the detailed agenda for the meeting.
By proposal of its Chairman, the Board of Directors may decide to create Committees within the Board responsible for studying issues which the Board itself or its Chairman submits to them for their examination and opinion. It determines the structure and powers of these Committees which conduct their activities under its responsibility.
Deputy Chief Executive Offi cers, or by a director nominated by the General Shareholders’ Meeting.
Furthermore, at the end of each fi nancial year, an inventory is drafted of the Company’s various assets and liabilities and accounting documents imposed by both the laws governing companies and by banking regulations.
At the Company’s expiry, or in the event of early dissolution, the General Shareholders’ Meeting determines the liquidation method, by proposal of the Board of Directors and subject to the legal requirements in force, and appoints one or several liquidators whose powers it determines.
Any objection which may arise among the shareholders concerning the execution of these bylaws are submitted to the courts having jurisdiction where the Company has its registered offi ce.
Purpose of the powers delegated Amount authorized Duration Date used Amount used
On November 25, 1985, Banque Française du Commerce Extérieur issued 140,000 non-voting shares with a par value of FRF 5,000 (€762.25). The coupon is payable annually on November 25. Redemptions are on the initiative of the borrower. At December 31, 2009, 113,000 non-voting shares were outstanding.
In 2008, the Natixis Executive Board approved a plan to grant stock options to certain employees and executive corporate offi cers of Groupe Banque Populaire and Groupe Caisse d’Epargne. The executive corporate offi cers of these two groups waived their right to their options.
NATEXIS BANQUES POPULAIRES BECOMES NATIXIS – PAR VALUE SPLIT BY 10 new situation 1,233,235,210 1,973,176,336 2006 expenses offset against contribution premium (3,879,879.00)
The directors, whether individuals or legal persons, owned 71.54% of the capital of Natixis at December 31, 2009 (almost all of this being owned by BPCE).
The principal provisions of the Caisses d’Epargne CCI s Agreement are as follows: 1 - RESTRICTION ON THE FREE TRANSFERABILITY OF CAISSES D’EPARGNE CCI s
In the event that BPCE exercises their right to buyback Caisses d’Epargne CCI s in cases (ii) or (iv ) , BPCE enjoys a preferential right over the Caisse d’Epargne concerned in exercising the promise of sale.
FRANCE Chairman and Chief Executive: Bolloré (formerly Bolloré Investissement) and Bolloré Participations Chairman of the Board of Directors (non-CEO): Financière de l’Odet, Bolloré Média, Compagnie de Bangor, Direct Soir and Havas Chairman of Bolloré Production; Chief Executive Officer: Omnium Bolloré, Financière V, Sofi bol; Director: BatScap, Bolloré (formerly Bolloré Investissement), Bolloré Participations, Bolloré Média, Compagnie des Glénans, Compagnie de Bangor, Direct Soir, Financière Moncey, Financière de l’Odet, Financière V, Omnium Bolloré, Sofi bol and Havas Member of the Supervisory Boards: Natixis and Vallourec Permanent Representative: Bolloré Participations on the Boards of Directors of Société Anonyme Forestière et Agricole (Safa), Société des Chemins de Fer et Tramways du Var et du Gard, Société Industrielle et Financière de l’Artois, Société Bordelaise Africaine, Compagnie des Tramways de Rouen, IER Permanent Representative of Bolloré Participations on the Supervisory Board of Compagnie du Cambodge
Chairman of the Board of Directors of Banque Populaire des Alpes
Member of the Executive Board, Chief Executive Officer of Natixis Chairman of Coface Holding Director of Vinci, of Lazard Permanent Representative of Natixis on the Board of Directors at Coface Permanent Representative of Natixis on the Board of Directors at Natixis Global Asset Management Permanent Representative of Natixis on the Board of Directors at Natixis Private Equity
Member of the Executive Board of BPCE (since 07.31.2009) Chairman of the Board of Directors of Natixis Asset Management, Erixel Chairman of the Supervisory Board of Banque Palatine, GCE Capital, SOCFIM Chairman of the Supervisory Board of FLCP (since 01.8.2009) Chairman of Erixel, de GCE Fidélisation (since 09.25.2009) Member of the Supervisory Board of ANF, of The Yunus Movie Project Partners (since 01.22.2009) Director of Crédit Foncier de France, of Natixis (since 08.25.2009), of Nexity, of Banque Privée 1818, of Banca Carige (Italy), of CNP Assurances, of Sopassure, of GCE Domaines, of Natixis Epargne Financière, of Natixis Epargne Financière Services, of Erilia, of La Chaine Marseille –LCM (ended 11.30.2009), of Ecureuil Vie Développement, Manager of Société Civile et Forestière de PY et Rotja (ended 12.31.2009). Permanent representative of BPCE, Director of CE Participations (since 07.31.2009), of Ecureuil Vie Développement, Member of the Supervisory Board of GIE CE Syndication Risque (since 10.22.2009), Member of the Supervisory Board of GCE Business Services Permanent representative of CNCE, Director Natixis (ended 08.25.2009) Permanent representative of CEPAC Chairman of the Supervisory Board of Viveris Management (ended 12.31.2009) Chairman of the Management Committee of Viveris (ended 12.31.2009) Director of the Banque des Antilles Françaises (ended 12.31.2009), of Marseille Aménagement (ended 12.31.2009)
Chief Executive Officer of Natixis (since 05.14.2009) Director: Natixis Global Asset Management (since 09.11.2009), Sequana, Arkema, Coface (since 10.27.2009), Lazard Ltd (since 07.28 . 2009), Cogefi SA (ended 05.13.2009) and Génération Vie (ended 05.13.2009) Permanent representative: Natixis, non-voting member ipso facto on the Board of Directors of BPCE (since 08.25.2009) Managing Partner of Oddo et Cie (ended 05.13.2009) Chairman and Chief Executive Officer of Oddo Asset Management (ended 05.13.2009) Permanent representative of Oddo et Cie, managing partner of Oddo Corporate Finance (ended 05.13.2009) Member of the Supervisory Board of Banque Postale Gestion Privée (ended 05.13.2009)
Member of the Natixis Executive Board Permanent representative of Natixis on the Board of Directors of Natixis Securities Legal representative of Natixis, Managing partner of Investima 74 Chairman of the Board of Directors of Natixis North America Inc. Chairman of the Board of Directors of Natixis Capital Markets Inc. Member of the Board of Directors of Natixis Bleichroeder Inc.
Chief Executive Officer of Calyon Americas (New York) Chairman of the Board of Directors of Calyon Securities Inc.
Chairman of the Board of Directors of Euris S.A. and Finatis Chairman and Chief Executive Officer of Casino, Guichard-Perrachon and Rallye Member of the Supervisory Boards : Groupe Marc de Lacharrière (SCA), Super de Boer (formerly Laurus) Director: HSBC France, Companhia Brasileira de Distribuicao (CDB) and Wilkes Participaçoes Non-voting member of Fimalac, Caisse Nationale des Caisses d’Epargne et de Prévoyance Manager: SCI Penthièvre Seine and SCI Penthièvre Neuilly Member of Consultative Committee of Banque de France Chairman of the association “Promotion des Talents” Vice-Chairman of Fondation Euris Honorary Chairman and Director of Institut de l’École Normale Supérieure
INTERNATIONAL Chairman of: Centaurus Capital Limited Director : Centaurus Alpha Master Fund Limited Centaurus Alpha Fund Limited Centaurus Capital International Limited Centaurus International Risk Arbitrage Master Fund Limited (formerly Centaurus Kappa Master Fund Limited) Centaurus International Risk Arbitrage Fund Limited (formerly Centaurus Kappa Fund Limited) Centaurus Asia Pacifi c Opportunities Master Fund Limited (formerly Centaurus Omega Fund Limited) Centaurus Asia Pacifi c Opportunities Fund Limited (formerly Centaurus Omega Fund Limited) Centaurus Capital Holdings Limited Centaurus Global Holdings Limited Centaurus Management Company Limited Trustee of: Ecole Polytechnique Charitable Trust Maison de l’ Institut de France in London
FRANCE Member of the Supervisory Board of Natixis Chairman and Chief Executive Officer of Veolia Environnement Chairman of the Board of Directors: Veolia Propreté, Veolia Transport, Veolia Water Director: EDF, Casino, Guichard-Perrachon, Dalkia International, Société des Eaux de Marseille, Sarp Industries Member and Chairman of the Supervisory Board of Dalkia France Member of the Supervisory Board: Elior, Lagardère, CNP Assurances Non-voting member of the Supervisory Board of Caisse Nationale des Caisses d’Epargne Member of Supervisory Boards A and B of Dalkia (SAS) Manager of Veolia Eau – Compagnie Générale des Eaux
Vice-Chairman of the Steering and Supervisory Board of Caisse d’Epargne Île-de-France
Vice-Chairman of the Supervisory Board: Natixis Chairman of the Board of Directors of Banque Populaire Provençale et Corse Chairman of the Board of Directors of Natixis Private Banking Chairman and Chief Executive Officer of Proclair SAS, Tourret SAS Vice-Chairman of the Board of Directors of Banque Fédérale des Banques Populaires Director of Lafarge Ciments Manager: Proclair Provence and of Proclair Rhône Alpes, of Sopres
LCB-FT Lutte contre le blanchiment de capitaux et le fi nancement du terrorisme/Prevention of money laundering and terrorism fi nancing