What is your reaction to the earnings the bank posted in 2005? Natexis Banques Populaires and its subsidiaries reported a 14% increase in net banking income. At the same time, the cost of risk declined and expenses were kept under control, lifting net income attributable to equity holders of the parent to B695 million.
in billions of euros 2005 figures: EU IFRS; 2004 figures: IFRS excluding IAS 32, 39 and IFRS 4 (see note II to consolidated financial statements)
The Natexis Banques Populaires share is included in the SBF 120, SBF 250 and CAC MID 100 indices.
Holders of bearer shares are notified of the Meeting through notices published in the Bulletin des Annonces Légales Obligatoires (BALO – and the financial press at least 30 days prior to the Meeting date, by calling the toll-free number reserved for shareholders (calls originating in France only) or by visiting the bank’s web site. Copies of the Notice of Meeting and the voting forms can be obtained from the bank or broker that manages their share account.
Legal formalities to be carried out before the Meeting Registered shares must be recorded in the holder’s registered share account or administered registered share account at least five days prior to the Meeting date.
The composition of the Board of Directors remained stable during the year, except that the permanent representative of the Banque Fédérale des Banques Populaires changed. Nevertheless, Board membership is regularly refreshed.The average length of service of the current Board members is 3.9 years.
Duquesne Daniel AGM of 2009 Director Chief Executive Officer May 23, 2002 Banque Populaire Loire & Lyonnais
Permanent representative of Banque Populaire Val de France,director: i-BP (Informatique-Banque Populaire)
Legal co-representative of Bercy Participations, co-manager and General Partner of: Société Elior
As part of its overall responsibilities, the Board made decisions about all matters related to the bank's strategy and business orientation. It approved the financial statements of the bank and the Group and reviewed the annual budget.At each meeting, the Board received regular information about business performance and also approved financial press releases.
The internal control report, in accordance with CRBF rule n° 97-02, as well as the Chairman’s report on internal control, in accordance with the Financial Security Act (loi sur la sécurité financière), were presented to and discussed by the Board.
n For 2006, the Board decided that the fixed portion of Mr. Ladam's compensation would be maintained at B365,000.
Committee Committee Committee (euros) controlled controlling members members members by NBP NBP
3.3 Executive pension plans and severance payments 3.3.1 Pension plans The Chairman and Chief Executive Officer of Natexis Banques Populaires belong to the complementary group retirement plan applicable to all Chief Executive Officers of the Banque Populaire Group.
Better control of risk Natexis Banques Populaires has continued to build up its market risk teams. Internal control systems have been strengthened on the most specialized business lines, as defined in the strategic plan: commodities financing, capital markets and structured finance. In addition, a project was launched to adapt the credit risk management model to the needs of sales teams and to domestic and international offices. Its objective is to implement a decentralized system, by creating risk management units wherever they may be needed. Similarly, local commitment limits have been reviewed with an eye toward decentralizing decisions and monitoring them once they are already in place. Ideas for simplifying centralized decision-making are also being explored.
Strategic management and internal control systems strengthened As an extension of the plan, the bank created a Strategy department to update and monitor the strategic plan, as well as to help the business lines carry out their development projects.
Finally, Natexis Altaïr now centralizes all the main-frame machines of i-BP (informatique Banque Populaire) and provides a growing volume of value-added services to i-BP and the Banque Populaire regional banks. In particular, an internet access common to the entire Banque Populaire Group was implemented in 2005, ensuring a very high level of security.
In addition, the Operations department’s ISO 9001 certification was renewed in 2005.
In 2005, Natexis Banques Populaires strengthened its skills and positioning in the worldwide commodity financing market. Its teams acted as mandated arranger in 25 transactions, including an increasing number of reserve-based lending deals. Seven of these transactions were named “Deal of the year” by Trade Finance magazine: Sonangol, IUD, Caraiba Metais, SUAL, RUSAL, Kazatomprom and Pearl Energy.
Natexis Private Equity and its subsidiaries, specialized in private equity business lines,play a role in every stage of a company’s development, from founding to pre-flotation financing.Natexis Private Equity builds relationships with investors and entrepreneurs based on its values of commitment and entrepreneurship. Banque Privée Saint Dominique, dedicated to private asset management, personalizes its approach to managing wealth by combining management of a diversified investment portfolio with legal and tax advisory services. Natexis Private Banking Luxembourg S.A. is specialized in international estate planning.
Natexis Private Banking Luxembourg S.A., a private bank, offers real estate asset management, financial asset management, finds international investors and acts as a bancassurer to an international clientele of individuals and legal entities.
Natexis Private Banking Luxembourg S.A. is positioned in the heart of Europe and benefits from efficient, practical,
flexible domestic legislation. It enjoys a stable political, social and economic environment and a competitive tax context. It embodies local presence and a banking tradition of quality, oriented toward its client-investor-partners.
In electronic banking, secure payment solutions were expanded. Use of the e-Visa card was extended to professional cards and the Cyberplus payment service for mail-order companies was redesigned.
Receivables Management brings together the resources and expertise of Coface and Natexis Factorem. It enables companies to optimize, in whole or in part, the financial management of their customer and supplier relationships. This core business comprises four business lines: company information, receivables management, credit insurance and factoring, enabling companies to manage, protect and finance their accounts receivable. Natexis Banques Populaires is at the forefront of these four businesses in France and across the globe. Coface offers companies a broad spectrum of receivables management solutions through its own network spanning 58 countries and through those of its partners in the CreditAlliance network (insurance companies and services companies). Natexis Factorem provides its services primarily through the Banque Populaire network.This multi-network strategy is one of the strengths of the Receivables Management core business, enabling it to maximize the volume of customer sales it handles.
The three-year incentive plan agreement signed in 2003 was applied for the last time in 2005. 60% of the total envelope was distributed on the basis of salary and 40% on the basis of hours or days worked in the company during the period.
Together with employee representatives, the bank devoted €112,350 to the financing of six school projects.These projects range from a preparatory class for young people lacking the requirements for entry into a vocational high school to a system to help blind people use public transportation.
Information Systems and Logistics 1,072 1,062 1,066 * Full-time equivalent – end of period in millions of euros
At Coface, the methods for handling sustainable development issues in the various business lines are different but complementary. For guarantees managed on behalf of the French government, Coface has been evaluating the impact of projects on the natural and human environment as part of regular examination of guarantee requests since 2000.All relevant information on this topic is available and regularly updated on Coface’s internet site.
The solidarity-based savings market totaled B613 million at the end of 2004 and B130 million of it was in solidaritybased employee savings. Natexis Asset Management and Natexis Interépargne are market leaders in solidarity-based savings, with solidarity-based employee savings of B93 million under management at December 31, 2004, or 71% of that market. Assets under management advanced significantly again in 2005, to B150 million.The bank owes its firsttier position to the complementary expertise of its two subsidiaries.
Innovative PERCO solutions Natexis Interépargne offers a PERCO that is entirely managed according to the principles of socially-responsible investing. The fact that the plan includes extra-financial factors in the selection process is regarded as an indication that it evaluates risk better and therefore that it has a better chance of achieving lasting performance.This dovetails with the pension -fund investment horizon.
just outside Paris. An intranet site was created and orientation brochures published to answer employees’ questions about the new building, the specifics of the move, measures to address transportation concerns, housing information, etc.Through a series of 120 visits to the new building, 1,200 employees were able to tour the site before the move.
Hiring and integrating people with disabilities is also becoming an important aspect of social responsibility. Natexis Banques Populaires has initiated a partnership with universities and grandes écoles through which it informs them that the bank is prepared to hire candidates with disabilities.To make sure the bank is truly integrating this initiative into its hiring policies, the Human Resources department has staffed a new function dedicated to diversity issues, and in particular to the hiring of people with disabilities.
In many cases, entry-level employees (24.6% of new hires) joined the bank after successfully completing a student internship (see chapter entitled “Human Resources”).
With socially-responsible employee savings in mind, management of Natexis Banques Populaires and labor unions signed an amendment to the Employee Savings Plan at the end of 2005. Mutual funds proposed to employees now include socially-responsible investment funds.
Employees have easy access to all training programs offered by the parent company, available on the HR intranet.
Similarly, the company does not install air conditioning systems that discharge heated water, so as not to pollute effluents. Instead, glycolated water from heat exchangers is periodically emptied and recovered by companies specialized in the treatment of it.
n Against the backdrop of particularly fierce competition, origination in lease financing increased by 12% between 2004 and 2005. New business in equipment leasing increased sharply (up 13%), while the performance of property leasing was in line with that of 2004 (down 2%).
Global Debt & Derivatives Markets was particularly hard hit by the adoption of EU IFRS, with a negative impact of B23.7 million. Under 2004 IFRS, net banking income would have increased by 18%.
n Structured financing n Origination amounted to B8.2 billion, an increase of 88% compared with 2004.
n Foreign exchange activities maintained strong business momentum from the start of the year, fuelled by the sharp rise in the dollar against the euro in a highly volatile environment. Net banking income increased by 54% year-onyear.
n Risk-weighted assets amounted to B5.9 billion,up B2.8 billion compared with 2004.
Coface’s equivalent net banking income amounted to B674.2 million,an increase of 16% compared with 2004.Apart from revenue growth, this growth in net banking income was thanks to a reduction of B27 million in reinsurance costs and a B50 million increase in financial income, although this was offset by a B52 million rise in the cost of claims,with a claims rate of 49% in 2005 compared with 46% in 2004.
Total net banking income came to B107.1 million compared with B102.2 million in 2004, an increase of 5%. Net banking income generated in France rose by 4% to B103.3 million. In Germany,VR Factorem – which has been proportionally consolidated (51%) since the start of 2004 – produced net banking income of B3.8 million, up 26%.
Information Systems and Logistics produced net banking income of B51.0 million, an increase of B13 million or 34% compared with 2004, due to the increase in Altaïr services provided to the Banque Populaire regional banks.
Collective provisions were booked for portfolios of similar assets with objective evidence of impairment based on the expected loss on maturity. This method resulted in the recognition in the opening balance sheet of a provision of B156 million for country risks and B208 million for industry risks.This method was applied as of January 1, 2005, and risks were monitored throughout the year.
n Industry risks: charge of B58 million. Provisions of B8 million were required for two new sectors showing evidence of impairment in 2005. The remainder relates to industries requiring provisions on a collective basis as at January 1, 2005.
Receivables Management 4 > Risk Management 4.1 - General System and Principles Natexis Banques Populaires’ risk management system complies with French banking regulations and with the corporate governance principles of the Banque Populaire Group, of which it is a member.There are three levels of control, which are coordinated by Executive Management. First tier control comprises continuous self checks by employees as part of their normal daily duties. Second tier control is provided by the Risk Management, Compliance and Internal Control depar tments, which report to the General Secretariat, and the Information Systems Security department, which reports to Information Systems and Logistics. These departments are completely independant from the business lines.Third tier control is provided by the Internal Audit department. Under current regulations, the General Secretary, a member of the Executive Management Committee, is responsible for permanent controls.
The risk committees established by each of the core businesses include business line heads and representatives of the Risk Management and Internal Audit departments. They include: - Credit Committee of Corporate and Institutional Banking and Markets and the subsidiaries that report to it; - Country Risk Committee; - Risk Committees of the Services business; - Risk Committees and Investment Committees of the Private Equity and Wealth Management core business; - Risk Committees of the Receivables Management core business (Coface and Natexis Factorem); - various limit violation committees.
4.4.3 - Breakdown of exposure at December 31, 2005 n b) Breakdown of exposure by MacDonough counterparty category
Risk Management is responsible for the financial component of second tier controls, in particular overseeing market risks and models. Its key duties are: - validating the proposals made by the middle office, ensuring their consistency throughout the Group and making recommendations where necessary; - monitoring market risks at the various consolidation levels and particularly at Group level;
- a market risks committee, which meets monthly and comprises the heads of the various control levels together with front office managers. It is chaired by the head of capital markets activities.The committee validates new limits, proposes changes to limits and reviews any identified limit violations; - a risk monitoring and supervision committee, which meets quarterly, comprising front office and middle office managers, the Risk Management depar tment and the Internal Audit department to present new methods for measuring risks and divide up developments for their implementation.
n Retrospective test: The retrospective test is used to ensure whether or not the hedging implemented at different accounting dates is effective.
After the project phase, each business line will implement its own permanent operational risk management system, coordinated with the Risk Management department, primarily via monthly reporting of losses and incidents, as well as a quarterly review of risks to be managed, their indicators and plans of action to reduce these risks.
This ratio must be higher than 100%. At December 31, 2005, the ratio stood at 155% versus 162% one year earlier.
There is a cross-default clause restricted to the issuer, with a B30 million trigger.
8 > Information on Natexis Banques Populaires parent company and proposed distribution of net income 8.1 - Information on the parent company (French GAAP) Net banking income rose by 14.5% or B183 million in 2005, including a B69 million increase in gains on trading portfolios, a B36 million increase in net commission income and a B96 million or 49% increase in income from variable income securities.
Diluted earnings per share 14.8 10.4 Consolidated net income - group share - per share, calculated on the basis of the average number of shares over the period excluding treasury shares and including potential shares arising from the exercise of stock options
Total movements related to relations with shareholders 12 60 (6) (151)
Cash, central banks, post offices (assets & liabilities) 170 124 Interbank balances (4,906) (6,413)
Note II.2 - Transition of the balance sheet at December 31, 2004, and January 1, 2005 115NATEXIS BANQUES POPULAIRES
Equity attributable to equity holders of the parent 4,170 3,116 Share capital and related reserves 3,116 717 Retained earnings 717
Financial liabilities at fair value through profit or loss - - - -
Other banking revenue and expenses - - - - (94) - (94)
Other banking revenue and expenses - - - - - - 0
Under article 84 of the 2001 amended Finance Act (law 2001-1276 of December 28, 2001), the mandate entrusted to Natexis Banques Populaires and companies under its control to manage certain public procedures on behalf of the State has been extended until December 31, 2005.This mandate was extended beyond December 31, 2005, by the 2005 amended Finance Act (law 2005-1720 of December 30, 2005). These transactions are recognized separately in the financial statements and some of them may be guaranteed by the State.The State and other related creditors have a specific right over the assets and liabilities allocated to these institutional activities.
Cash flows are projected over a three-year period, which corresponds to the period covered by the medium-term plan (2006-2008) for all business lines and activities, except for life insurance and personal risk insurance, for which cash flows are projected over a ten-year period.
The sensitivity of the Group’s net cash position to changes in interest rates is attenuated by the classification of around B7,000 million of interest rate securities in the “Held-tomaturity financial assets” category.
ASSURANCES BANQUE POPULAIRE PREVOYANCE Personal risk insurance 100 100 100 100 100 100 ASSURANCES BANQUE POPULAIRE Mutual fund for insurance
AXA ASSURCREDIT * (formerly Assurcredit) Credit insurance and services 40 40 40 40 40 39 AXELTIS LTD (Asset Square London) Mutual fund distribution 100 100 100 100 100 100 BAIL EXPANSION Lease financing 100 100 100 100 100 100 BANCASSURANCE POPOLARI * (22) Life insurance (22) (22) 51 51 51 51 BANQUE PRIVEE ST DOMINIQUE Private asset management 100 100 100 100 100 100 BP DEVELOPPEMENT ** (20) Venture capital 42 36 (20) (20) (20) (20) BPSD GESTION Private asset management 100 100 100 100 100 100 CENTRE D’ETUDES FINANCIERES (CEF) Business information and solvency 100 100 100 100 - CIMCO SYSTEMS LTD Information and debt management services 100 100 100 100 100 98 CO-ASSUR Insurance broker 100 100 100 100 100 100 COFACE (5) Credit insurance and services 100 100 100 100 98 98 COFACE CHILE SA (8) Credit insurance and services 84 84 - - - COFACE COLLECTION NORTH AMERICA Information and debt
(11) Merger with NAM with retrospective effect as of January 1, 2005
(30) Liquidated and transferred to Natexis Actions Capital Structurant on September 1, 2003
Income, value adjustments and gains or losses on securities: - Income from variable-income securities is recorded on a cash basis; - Income from fixed-income securities is recorded on an accruals basis; - Value adjustments and gains or losses on disposal of securities appear under different headings depending on the nature of the transaction: °Trading account securities, securities held for sale and equity securities held for investment: value adjustments and gains or losses are recorded in net banking income; ° Debt securities held for investment: value adjustments and gains or losses are recorded under “impairment charges and other credit provisions”where they reflect counterparty risk, and “net gains/(losses) on disposals of fixed assets» where they reflect market risk or the result of disposal; ° Investments in affiliates and other long-term equity investments: value adjustments and gains or losses are recorded under “net gains/(losses) on disposals of fixed assets”.
After initial recognition, they are measured at amortized cost using the effective interest method and tested for impairment on each reporting date. Where necessary, an impairment loss is recognized in the income statement under the heading “impairment charges and other credit provisions”.
Provisions are determined on a case-by-case basis and adjusted at quarterly intervals, based on an analysis of the related risk and available collateral.
Forward currency hedging transactions are taken to income on an accruals basis, either as premiums or discounts where they are intended to hedge commercial transactions, or as accrued interest where they are intended to hedge longterm assets and liabilities denominated in foreign currencies.
In the case of trading activities, positions in a class of option or forward contract are marked to market at the period end. Changes in value during the period are taken immediately to the income statement. For over-the-counter instruments, a discount may be taken against the market value in respect or modeling risks or uncertainty over parameters, via a charge to provisions for financial instruments.
Prospective test The prospective test entails the establishment of (by index type and currency): - a schedule of cumulative variable-rate borrowings and fixed-rate borrower swaps by maturity; - a schedule of cumulative variable-rate loans and fixed-rate lender swaps by maturity.
Impact on equity and consolidated income Changes in the fair value of derivative instruments are recorded in equity for the effective portion of hedging. Only the ineffective portion of hedging affects the income statement at the accounting date under “net gains or losses on financial instruments at fair value through profit or loss”.
Hedged items are not subject to any specific entries (other than those that would arise if they were not hedged).
In accordance with IFRS 1 (§ 29), existing hedging relationships at December 31, 2004, are recognized at the transition date of January 1, 2005, excluding any relationships not allowed under IAS 39 such as interest rate hedging of held-tomaturity securities.
Other intangible assets primarily comprise: - Purchased goodwill with an indefinite useful life, which is not amortized by tested for impairment at least annually; - Value of the Coface portfolio, which is amortized over the term of the contracts (eight to ten years for France).
5.9 Financial liabilities at fair value through profit or loss These include financial liabilities held for trading (including derivative financial instruments) and those designated as at fair value at initial recognition in line with the option available under IAS 39 and described in more detail in the June 2005 amendment.
Maximum sensitivity of interest rate maturity schedules to a +/-1% shift in the yield curve is B100 million.
Minimum liquidity gap coverage ratios are as follows: Ratio n Currency risk
The interest rate risk of Natexis Banques Populaires and its main subsidiaries is subject to maximum exposure limits, which are defined and validated annually by the ALM Committee.
VIII.1.2 - Financial liabilities at fair value through profit or loss At December 31, 2005, financial liabilities at fair value through profit or loss comprised primarily derivatives not used as hedging instruments and liabilities relating to short-selling of financial assets (securities).
(1) The hedging rate of non-performing loans at December 31 was 60% compared with 63% at January 1, 2005.
Flow-through entities (204) (221) Leasing reserve (249) (219) Elimination of equalization reserve (246) (187) Financial instruments at fair value through equity (AFS+CFH) (218) (105) Capitalization reserves of insurance companies (71) (70) Fair value of Private Equity business (253) (177) Amortized cost of loans 62 42 Provisions for employee benefits 231 223 Other non-deductible provisions (2) 490 376 Unrealized gains on mutual funds 11 13 Ordinary and evergreen tax loss carryforwards 99 164 Other temporary differences 1 (10)
Deferred income and accrued charges - insurance companies VIII.7.3.2 985 177 in € millions 12/31/2005 01/01/2005 EU IFRS EU IFRS
Cost Depr, Net Cost Depr, Net amort & amort & impair- impairment ment
IX.4 - Gains or losses on available-for-sale financial assets Net gains or losses on available-for-sale financial assets principally comprise gains or losses on sale and impairment losses on variable income securities.
A ministerial decree of July 18, 2005, resulted in the modification of the French pension system. Departures on the initiative of the employer before the age of 65 are no longer subject to social security contributions. The impact of this decree is treated as a past service cost, spread out over the remaining vesting period, as determined by the entity.
Available-for-sale financial assets 7,396 460 13,326 842 4,471 (4,255) - 22,240
Financial liabilities at fair value through profit or loss 5,307 23 32 - 7 (81) 5,288
Liabilities ( in € millions) On Less than 3 months 1 year More than Indefinite Total demand 3 months to 1 year to 5 years 5 years
Members of the Financial Statements Review Committee, the Audit Committee and the Compensation Committee received in addition €915 per meeting and per director.
Number of Executive Management Committee members: 11 in 2005, 11 in 2004, 9 in 2003.
Net gains/(losses) on securities held for sale 22 117 68 73
Net (charge to)/reversal of fund for general banking risks 13 - (1) (1)
Purchased software is amortized over its estimated useful life, which in most cases is less than five years. Internallygenerated software is amortized over a period which may not exceed fifteen years.
1.10 Interest, premiums, fees and commission Interest, together with premiums, fees and commissions treated as interest income are recognized in profit or loss on an accruals basis. Other fees and commissions are accounted for on a cash basis.
n The first two categories are treated for income statement purposes as equivalent to lending/borrowing transactions and the amounts received or paid are recognized in profit or loss on an accruals basis.
n In the case of specialized management of a trading portfolio, each instrument is marked to market on an individual basis. Changes in value during the period are recognized immediately in profit or loss. Valuations are adjusted for counterparty risk and the discounted present value of future contractual management costs.
Accrued interest receivable 41 28 27 Non-performing loans 561 755 817
NATEXIS PRIVATE EQUITY 5-7, rue de Monttessuy - 75007 PARIS 438,456 EUR 149,555 EUR 91.64% 465,121 465,121 250,000 - 81,784 EUR 63,646 EUR 36,688 *
SOCIETE FINANCIERE BFCE 5-7 rue de Monttessuy - 75007 PARIS 92,308 EUR 60,958 EUR 100.00% 92,951 92,951 - - 5,439 EUR 4,691 EUR - *
* Figures taken from accounting documents at December 31, 2005 (1) The carrying value of these securities is higher than their cost due to foreign exchange gains
Note 13b Regulated provisions in € millions Revaluation reserve for Provisions for Accelerated Total depreciable assets investment depreciation
The first two depar tments have to operate in accordance with the principles set out in the charters relating to “risk” (operational, financial and credit risk), while the latter two departments adhere to the charter relating to “compliance”.
General Secretariat and is therefore independent of the business lines. It is decentralized, with team members based locally in all operating entities, reporting hierarchically (parent company) or functionally (subsidiaries and branches) to the Internal Control department. Functional ties are strong, as the head of Internal Audit approves the appointment and departure of team members, as well as setting their targets, plans, budgets, evaluations and promotions.
As regards procedures, the efforts of previous years – such as the development of audit guides and IT tools to help in audits – were continued.
Operational risk management is based primarily on the principle of the responsibility of business line management for first-tier risks and an internal control system applicable to all activities.
At the end of the pilot phase in the first half of 2005, the plan for the roll-out of the Departmental operational risk management project was validated by Executive Management. The project will be implemented in four stages: one – which is already complete – in the last four months of 2005, and another three in 2006.
The risk of non-compliance is defined as the risk of legal, administrative or disciplinary action, financial loss or damage to the bank’s reputation as a result of the failure to respect requirements relating to banking and financial activities, whether legislative or regulatory in nature, or relating to professional and compliance standards, or instructions from the executive body, in particular in application of the strategic decisions of the governing body.
As part of the transition, a new consolidation package has been designed and distributed, allowing the identification and checking of all information additional to that required under French accounting standards to enable the transition to IFRS.This solution, which comprises 4,500 checks, allows
The projects embarked upon by the Finance department in 2004 concerning the restructuring of the accounting control system and the development of an enterprise systems development plan continued in 2005: n the accounting control system was adapted to a tighter accounts preparation schedule under more demanding legislative and regulatory requirements. The reliability of the accounting control process through monthly reporting was ensured by the implementation of an adequate organization to support the role of employees responsible for first- and second-tier checks, as well as redefining the map of controls and adapting it to the needs of the business lines, and finally the implementation of a centralized reporting system offering an overall view of the results of controls.An IT solution to meet the reproduction, synthesis and management requirements of accounting controls became operational with the launch of accounting control reproduction system Nordicc for the preparation of the 2005 financial statements, the functionalities of which will be extended in 2006; n the enterprise systems plan became operational with the preparation of the restructuring of the IT systems of central functions (accounting, management control management of counterparty risks etc.).The expression of the requirements of the new accounting system was defined at the same time as the target system structure.
Exercise of voting rights Pursuant to article 26 of the bylaws, shareholders are entitled to one vote for each share that they own or represent, subject to the following conditions.
The merger of the company shall have no effect on double voting rights, which may be exercised within the absorbing company where permitted by its bylaws.
Renewal of authority to grant stock options The purpose of the twelfth resolution is to renew the authority granted for one year by the extraordinary general meeting held on May 19, 2005, to grant stock options to employees of Natexis Banques Populaires and its subsidiaries and other employees of the Banque Populaire Group.
Authority to reduce the capital stock The purpose of the fourteenth resolution is to grant the Board to reduce the capital stock by the cancellation of shares.
The shareholders resolve that the purchase price may not exceed B250 per share, subject to any adjustments required for capital transactions made by the company.
Legal form Natexis Banques Populaires is a société anonyme governed by French company law, the provisions of the French Monetary and Financial Code (Code Monétaire et Financier) and its bylaws.
This general meeting of shareholders also decided, in accordance with the regulations: n that in the event of excess demand, the issuances of shares decided on could be increased by up to a maximum of 15% of the initial issuance; n that the Board could make issuances of up to 10% of the capital stock in the form of equity capital or marketable securities conferring rights in the capital stock, in order to pay for contributions in kind to the company.
Having regard to the number of options actually allocated pursuant to these authorizations (2,159,300) and authorizations prior to 2001 (420,000), the number of options already exercised and the number of options cancelled, the number of options remaining to be exercised at December
Year Description Number of Capital Issue premiums shares stock on increases in
Shares issued following the merger with real estate company ABC 217 3,472 3,943.16
17. Employees 17.1. Number of employees 54, 63 17.2. Directors’ shareholdings and stock options 266 17.3 Arrangements for involving employees in the issuer’s capital 269 18. Major shareholders 18.1. Shareholders owning more than 5% of the share capital or voting rights 268 18.2. Different voting rights 8, 257 18.3. Control over the issuer 269 18.4.Arrangements, known to the issuer, the operation of which may at a subsequent date result in a change in control 269 20. Financial information concerning the issuer’s assets and liabilities, financial position and profits and losses 20.1. Historical financial information 102 to 242, 275 20.2. Pro forma financial information N.A. 20.3. Financial statements 102 to 242 20.4.Auditing of historical annual financial information 202 - 203, 243 - 244 20.5.Age of latest financial information 102 20.6. Interim financial information N.A.