Photos: Short stories: MEETING SUPPORTING OUR EMPLOYEES OUR CLIENTS Our thanks to the photography agency La Despite the challenging financial climate Company, which provided photos for this 2009 in 2009, BNP Paribas continued to play its Annual Report, and to the three photographers essential role as a banker financing the − Grégoire Korganow, Jean-Érick Pasquier and economy and its clients’ business development Gérard Uféras – who travelled around the world – for retail, professional, and corporate clients to meet BNP Paribas employees. Thanks also to alike. As proof of BNP Paribas’ commitment, this the employees who took the time to speak with Annual Report contains thirty Short stories them in Paris, Lyon, Brussels, London, Rome, illustrating some of the Bank’s concrete New York, Boston, Hong Kong, Istanbul, Casa- actions for its clients in 2009. These eclectic blanca, and Bahrain. short stories come from all four corners of the world, passing from Europe to Asia and going through the Maghreb, Caribbean, and United States. They describe clients that the Bank is proud to serve, as well as the exceptional deals and best practices that have made BNP Paribas the success it is today. CONTENTS MESSAGE FROM THE CHAIRMAN AND THE CEO / 02-05 BNP PARIBAS 10-YEAR BIRTHDAY / 06-07 BNP PARIBAS AROUND THE WORLD / 08-09 KEY FIGURES / 10-11 EXECUTIVE COMMITTEE / 12-13 THE BOARD OF DIRECTORS / 14 -17 BNP PARIBAS AND ITS SHAREHOLDERS / 18-29 RETAIL BANKING / 30-57 FRENCH RETAIL BANKING / 32-41 BNL BANCA COMMERCIALE / 42-47 BANCWEST / 48-49 EMERGING MARKETS / 50-53 BNP PARIBAS PERSONAL FINANCE / 54-55 EQUIPMENT SOLUTIONS / 56-57 BNP PARIBAS FORTIS / 58-65 BGL BNP PARIBAS / 66-69 INVESTMENT SOLUTIONS / 70-89 BNP PARIBAS INVESTMENT PARTNERS / 72-75 BNP PARIBAS ASSURANCE / 76-79 BNP PARIBAS WEALTH MANAGEMENT / 80-81 BNP PARIBAS PERSONAL INVESTORS / 82-83 BNP PARIBAS SECURITIES SERVICES / 84-87 BNP PARIBAS REAL ESTATE / 88-89 CORPORATE & INVESTMENT BANKING /90-103 ADVISORY AND CAPITAL MARKETS / 92-99 FINANCING BUSINESSES / 99-103 KLÉPIERRE & BNP PARIBAS PRINCIPAL INVESTMENTS / 104-109 INNOVATION / 110-115 CORPORATE SOCIAL AND ENVIRONMENTAL RESPONSIBILITY / 116 -157 THE GROUP’S APPROACH / 118-125 HUMAN RESOURCES / 126 -145 A PARTNER IN SOCIETY / 146 -157 GLOSSARY / 158-167 2009 ANNUAL REPORT CONTENTS 01 MESSAGE FROM THE CHAIRMAN AND THE CEO Since the summer of 2007, the global fi - grations have already proven successful 2009, nancial system has been grappling with a in several areas visible to clients. crisis of a magnitude not seen in the past The Fortis Banque and BGL acquisitions a structuring 70 years. This crisis has brought down nu- also mark a considerable increase in merous fi nancial establishments, some of scale for the Group; BNP Paribas now year for a bank them venerable institutions, and severely has over 200,000 employees in more than shaken the public’s trust in the banking 80 countries, and has become a major dedicated system. Governments and central banks European fi nancial institution with four in all countries have intervened; some- domestic markets: France, Italy, Belgium, to serving times, as was the case in France, the in- and Luxembourg. The Group has deep its clients tervention was done for the sole purpose roots in these countries, and continues of temporarily giving banks the fi nanc- to carry out its primary mission of helping and fi nancing ing they need to prevent credit from its clients − individuals, businesses, and evaporating. But more often – and most institutions – realise their goals. the economy notably in the USA, UK, and Germany − Following the integrations of Fortis governments were forced to rescue large Banque and BGL, BNP Paribas now stands banks with heavy losses to prevent the as the eurozone’s biggest deposit bank, crisis from becoming systemic. This ca- with EUR 450 billion of deposits, and the tastrophe was avoided, but the fi nancial leading bank for European companies, crisis was followed by a sharp deteriora- with an unparalleled network of over tion in the economic climate and a surge 100 Business Centres in 25 countries. in unemployment, mainly in the USA and Throughout 2009, BNP Paribas staff Europe. worked incessantly to bring the Group’s BNP Paribas, with its development model valuation back in line with its potential. focused on customer service and based Thanks to these efforts, BNP Paribas’ from the very beginning on a balanced share price has almost doubled in a year. business portfolio, meticulous risk man- BNP Paribas shareholders’ confi dence in agement, and genuine fl exibility, is one the Group was refl ected in the successful of the rare fi nancial institutions that re- October 2009 share issue, which enabled mained profi table during the three years the Group to both pay back the French of the crisis. Thanks to its resilience, the government and shore up its capital so Group was able to not only grow its mar- as to be better positioned to face the ket share around the world, but also ce- future. ment the European ambition that formed part of its original goals. Ten years after the birth of BNP Paribas, which was the result of an unprecedented stock market battle, the Group completed one of the period’s few cross-border transactions with the takeovers of Fortis Banque and BGL. Merger implementation work was started almost immediately, and the inte- 02 2009 KEY A sharp FIGURES rebound NET EARNINGS GROUP SHARE in 2009 net mitment to help finance the French 5.8 income economy. The Group’s loans to con- BILLION EUROS sumers grew 5.1% during the year, and NET BANKING INCOME its loans to companies expanded 3%. Despite the sluggish economic cli- 40,191 mate in 2009, BNP Paribas performed BNL completed its integration plan MILLION EUROS well during the year with a 93% re- in 2009, thus exceeding the target bound in net income Group share to it set three years ago in spite of the EUR 5,832 million. weaker-than-expected economic GROSS OPERATING environment. INCOME The Retail Banking business faced strong headwinds in 2009 due to the Personal Finance demonstrated re- 16,851 global recession, but its employees put markable fl exibility and fully offset the MILLION EUROS in a considerable effort to confront this rise in its cost of risk with higher gross challenge. income. NET INCOME GROUP SHARE The Group’s Retail Banking strategy, At BancWest and Emerging Markets, which aims to pool the resources and 2009 was a particularly tough year know-how of BNP Paribas’ worldwide due to the persistently weak Ameri- 5,832 retail banking network, is now opera- MILLION EUROS can economy and a severe recession tional, and has been enhanced by the in the Ukraine. takeovers of Fortis Banque and BGL. RETURN ON EQUITY These two subsidiaries’ employees BNP Paribas Fortis and BGL BNP Paribas and operations have been successfully contributed EUR 708 million to the 10.8% brought into the Group thanks to the ef- Group’s net income Group share. This fi cient organisation of the Retail Bank- initial signifi cant contribution was ac- DIVIDEND PER SHARE ing business. This business as a whole companied by renewed sales momen- * has held up well during the landmark tum in all activities. Belgian retail bank- 1.50 2009 recession, in spite of the corre- ing saw a rebound in client deposits EUROS sponding jump in its cost of risk. and asset infl ows following the launch of several popular new marketing * Subject to the approval French Retail Banking’s 31,000 employees campaigns in May 2009. Meanwhile, of the AGM on 12 May 2010. played an active role in 2009 to ensure Luxembourg retail banking experi- that BNP Paribas could meet its com- enced moderate growth in loans and steady deposits. 2009 ANNUAL REPORT MESSAGE FROM THE CHAIRMAN AND THE CEO 03 Investment Solutions took on a new Although BNP Paribas is one of the “ BNP Paribas’ scale in 2009 thanks to its remarkable banks that best withstood the crisis, resistance during the crisis. Total net in- the Group has decided to take proac- close client fl ows across all its businesses reached tive measures to reform the variable EUR 25.5 billion in 2009, bringing the pay policy for its traders. These reforms relationships are annualised asset infl ow rate to 5.1% of strictly adhere to the new national and assets under management. This rate international standards set forth by the the competitive is higher than that in 2007 and nearly G20, and reflect the Group’s strong 2.5 times that in 2008 (which was posi- desire for moderate compensation advantage that tive, extremely rare for a bank), prov- schemes. For CIB as a whole, compen- ing that BNP Paribas’ appeal remained sation represented 27.7% of revenue in best weathered strong throughout the fi nancial crisis. 2009 – sharply lower than the ratio of around 40% in previous years. the crisis. Corporate & Investment Banking (CIB) boosted its profitability substantially Our clients’ trust in 2009, fuelled in part by a return to more normal market conditions. How- is our most ever the main factor behind CIB’s turnaround was the concerted effort valuable asset.” by all its employees. By scaling back risky positions, controlling costs, and refocusing its product line, CIB’s glo- bal platform was able to return to solid footing and make a sizable contribu- tion to BNP Paribas’ 2009 profi t. This re- markable performance underscores the high quality and diversity of the CIB platform, as well as the strength of its customer-focused business model and its ability to quickly adapt to new market conditions.