Investor Presentation - Agence France Locale

Transcription

THE FRENCH LOCAL GOVERNMENT
FUNDING AGENCY
INVESTOR PRESENTATION
Agence France Locale
Disclaimer
This presentation has been prepared and is distributed by Agence France Locale (the “Company”) for information purposes only and does not constitute or form part of any recommendation, solicitation, offer or
invitation to purchase or subscribe for any shares, securities, bonds and/or notes (together, if any, the “Securities”) that may be issued by the Company. Neither this presentation nor any part of it shall form the basis
of, or be relied upon in connection with, any contract or commitment whatsoever.
If any offer or invitation is made, it will be done pursuant to separate and distinct documentation in the form of a prospectus or other equivalent document (a “Prospectus”) and any decision to purchase or subscribe for
any Securities pursuant to such offer or invitation shall be made solely on the basis of such Prospectus and not this presentation. This presentation is not a Prospectus and does not contain all of the information
which would be required to be disclosed in a Prospectus.
Any person who subsequently acquires Securities must rely solely on the final Prospectus published by the Company in connection with the offer of such Securities, on the basis of which purchases of or subscription
for such Securities shall be made. Each recipient of this presentation shall independently assess the relevance of the information contained herein and shall consult with its own legal, regulatory, tax, business,
investment, financial and accounting advisers to the extent it deems necessary, and make its own investment, hedging and trading decisions (including decisions regarding the suitability of an investment in the
Securities) based upon its own judgment and advice from such advisers as it deems necessary and not upon any view expressed in this presentation. This presentation does not constitute the giving of any
investment, legal, tax or business advice by the Company or any of its affiliates, shareholders, directors, officers, advisers, agents or representatives.
No representation or warranty, express or implied, is made as to, and no reliance may be placed for any purposes whatsoever on, the fairness, accuracy, completeness or correctness of the information or opinions
contained herein. The information presented in this presentation is subject to change by the Company without notice. Neither the Company, nor any of its affiliates, shareholders, directors, officers, advisers, agents or
representatives shall have any liability whatsoever (in negligence or otherwise) for any loss arising from any use of this presentation or its contents, any errors or omissions contained herein or otherwise arising in
connection with this document.
This presentation may contain projections, forecasts, estimates and other forward-looking statements including those concerning the Company’s plans, objectives, goals, strategies, future events, future revenues or
performance, investments, financing needs, plans or intentions relating to competitive strengths and weaknesses, business strategy and the trends the Company anticipates as regards the political and legal
environment in which it operates, as well as the local government political and legal environment and any other information that does not constitute historical information. By their nature, forward-looking statements
involve inherent risks and uncertainties, both general and specific, and there is the possibility that the predictions, forecasts, projections and other forward-looking statements will not be achieved. Forward-looking
statements are subject to significant business, economic and competitive uncertainties and contingencies, many of which are or may be beyond the control of the Company. The Company does not make any
representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved, and such forward-looking statements represent, in each case, only one of many possible
scenarios and should not be viewed as the most likely or standard scenario. Such forward-looking statements are only relevant on the date on which they are made. Any opinions expressed in this document are
subject to change without notice and the Company does not undertake any obligation to update or revise any forward looking statement, whether as a result of new information, future events or otherwise.
This presentation shall not be reproduced, distributed or transmitted to any third party nor published in whole or in part by any means, without the prior written consent of the Company.
This presentation speaks only as of its date and is subject to change, correction and supplementation without notice. No party has undertaken to update this presentation to reflect events or circumstances after the
date on which the presentation is distributed, or to provide any further information, including any information required to correct any earlier inaccuracy or error.
In some countries, the offer or sale of Securities as well as the mere reproduction, distribution and/or transmission of this presentation may be illegal and/or subject to legal restrictions and/or regulations. This
presentation shall accordingly not be made available or distributed in such countries and it is the recipient’s responsibility to assess whether it may use and/or review this presentation and/or the information contained
herein.
Nothing in this presentation or in the information contained herein constitutes an offer of Securities for sale in the United States or in any other jurisdiction where it is unlawful to do so. This presentation is not
provided for, or intended to be directed at, any person in the United States or any U.S. Person (as that term is defined in Regulation S under the United States Securities Act of 1933, as amended (the “U.S. Securities
Act”)) or any person in any other jurisdiction where it is unlawful for the information to be provided or directed.
Any Securities that may be issued by the Company have not been, and will not be, registered under the U.S. Securities Act or the securities laws of any state or other jurisdiction of the United States and may not be
offered or sold, directly or indirectly, in the United States or to, or for the account or benefit of U.S. Persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the
U.S. Securities Act and applicable state or local securities laws. The Company invites the recipients of this presentation to inform themselves and comply with such restrictions and/or regulations. The presentation
may not be forwarded or distributed to any other person and, in particular, may not be forwarded to any U.S. Person or U.S. address.
January 17
2
Summary
The high creditworthiness of Agence France Locale is based on:
•
A strong governance based on a dual company entity
•
An online credit distribution to local authorities (e-bank)
•
An efficient model as demonstrated by the Nordic LGFAs
•
A high quality balance sheet due to the strong credit profile of French local authorities
•
Aa3 (stable) / P-1 ratings to Agence France Locale assigned by Moody’s
•
20% risk weight securities, eligible to the Public Securities Purchase program of ECB
•
Outstanding capital commitments from local authorities representing almost 25% of AFL long-term objective
January 17
3
Contents
I
Characteristics and
financial
framework
II
Operational
activities and
Development
III
Financial
Objectives and
Funding Strategy
A credit institution dedicated to the
funding of local authorities in France
• Agence France Locale is a local government funding
agency fully owned by French local authorities
AFL- Key Dates
• The banking law dated 26 July 2013 has conferred
upon Agence France Locale the mandate to finance
local authorities in France
• Agence France Locale is a fully regulated
specialized financial institution supervised by the
French banking regulator
• Agence France Locale is rated Aa3 (stable)/P-1 by
Moody’s.
January 17
26 July 2013
12 January 2015
6 March 2015
2 June 2016
Authorized by
the banking law
Banking licence as a
specialized credit
institution
Visa on AFL’s
EMTN programme
granted by the
French Financial
Market Authority
AFL bond issues
eligible to the ECB
Public Sector
Purchase Program
(PSPP)
5
Agence France Locale, a bridge between
capital markets and local authorities
Agence France Locale funds itself in international capital markets.
Bond market
€M
€750 M
800
700
600
500
400
300
200
100
0
0,375% fixed
rate
March 2022
€500 M
0,250% fixed
rate
March 2023
March 2015
Dedicated to Local Authorities
(online plateform)
May 2016
Last public transactions
January 17
A specialized credit institution
Local Authorities
(exclusive shareholders and guarantors)
6
The model of Local Government Funding
Agencies (LGFAs) has proved highly efficient
over the years
Over 115 years in Northern Europe
A proven model
The model of a national funding agency bringing together local
authorities to pool their borrowing needs in the bond market has
already proved successful in various Northern European
countries.
An emulating model
A number of other countries are following suit: New Zealand and
the United-Kingdom have just set up their own local government
funding agencies and a similar analysis is conducted in various
other countries throughout the world.
1926
(Aaa/Aaa/NR)
No default recorded since the
Nordic agencies were established
1989
(Aa1/Aa+/NR)
1986
(Aaa/Aaa/NR)
1899
(Aaa/Aaa/NR)
1914
(Aaa/Aaa/Aaa)
An exclusive mission
Based on this model, an exclusive mission : funding the
investments of the French local authorities.
January 17
1954
(Aaa/Aaa/NR)
2013
(Aaa3/NR/NR)
Moody’s/S&P/Fitch ratings
NR: Non Rated
7
Structure and Governance of the
Agence France Locale Group
Governance is based on a dual
company entity
Separating the specialized credit
institution operations from member local
authorities strategic management
Ensuring a greater accountability of
stakeholders through a system of
transparent checks and balances
Shareholder base
Agence France
Locale
Société Territoriale
Agence France
Locale
The credit institution
(Aa3/P-1)
 Fully-owned by member
local authorities
Mission
 Determination of strategic
guidelines
 Nomination of the Supervisory
Board members
 More than 99.99% of the
capital owned by Agence
France Locale - Société
Territoriale
Governance
 Board of Directors
representation rule:
weighted percentage of
outstanding debt
 General meetings
 Management of the guarantee
system
 Executive management
 Fund-raising via bond markets
 Supervisory Board
 Loan provision to local
authorities
Majority: independent
Directors minority: ounding
member local authorities
 Executive Board
professional bankers only
January 17
8
French local authorities as exclusive
shareholders and borrowers
Shares of total debt held by French local authorities (€141,5 bn as of 31/12/2014)
45 %
16 %
24 %
15 %
Cities
Intercommunal
entities
Departments
Regions
Main responsabilities:
Local actions
Almost all French cities are
part of a tax-raising
intercommunal cooperation
public entities
Social work, public roads
and middle schools
Economic dvpt, transports
and high schools
The current subdivision may evolve with the promotion of Metropolitan areas and the territorial reform
January 17
9
The strong sub-sovereign risk of French
local authorities
The regulatory framework governing French local authorities is
highly stringent.
Local authorities:




The outstanding debt of French local authorities amounts to 8% of the GDP
French local authorities made a budget surplus of EUR 700M€ in 2015
French local authorities contributes to the bulk of public investment. They
especially focus on infrastructures.
70% of their investment expenditure is self-financed.
2015
 Are compelled to balance their budget
Central
government
Social security
entities
Local
governments
Other central
public entities
Other local
public
entities
TOTAL*
Total
expenditures
463,3
579,1
226,8
86,1
22,4
1243,3
Investment
expenditures
9,9
7,7
39,1
16,2
2,4
75,3
Debt as of
31/12/2015
1 661,2
220,3
145,8
18,9
50,7
2096,9
(in billion
euros)
 May only borrow funds in order to finance their investments
 Must repay debt interests and capital on their own resources
French local authorities cannot go bankrupt or undergo liquidation
proceedings.
* Financial transfers between sectors are consolidated and, as a consequence, the sum of data from all sectors is higher than the
consolidated data for «TOTAL »
Sources :Direction Générale des Collectivités Locales, Les collectivités locales en chiffres 2016, septembre 2016 ; INSEE, Les comptes
des administrations publiques en 2015, mai 2016, (www.collectivites-locales.gouv.fr) INSEE
January 17
10
A Dual First Call Guarantee System
• Each member local authority provides an explicit and irrevocable first call guarantee to the financial creditors of AFL up to
the amount of its outstanding debt received from AFL,
• AFL - ST also provides an explicit and irrevocable first call guarantee to the financial creditors of AFL up to an amount
which is set annually by the Board
Guarantee
beneficiaries
Société Territoriale Guarantee
Call by Creditors to AFL- ST
Independent first call guarantee
undertaking made by Agence France
Locale - Société Territoriale to the
benefit of Agence France Locale’s
creditors.
Société Territoriale
Members Guarantees
Call by AFL- ST to Local Authorities
Agence France Locale - Société
Territoriale can call the Members
Guarantees in two situations:
Preventive call by AFL to the ST
Agence France Locale can call
the Société Territoriale
Guarantee
preventively in order to avoid any
financial difficulty
Local Authorities
as guarantors
If the Société Territoriale Guarantee is
called by creditors
Preventively in order to avoid any late
payments by Agence France Locale if
this latter decides to call the Société
Territoriale Guarantee
Members Guarantees
Call by Creditors to any member Local Authoritiy
Independent and individual first call guarantee undertakings made by each member to the benefit of Agence France
Locale’s creditors
Each creditor is allowed to call the guarantee against any member up to this member’s guarantee ceiling
January 17
11
Based on the scoring of local authorities
A scoring scale from 1 to 7
A two-component scoring :
1 is the highest score
• Firstly, a financial scoring1 is realized for membership application
A local authority which is scored above 6 is not allowed to join Agence France Locale as a
shareholder
• Secondly, for the purpose of loan provision, a socio-economic scoring is
performed in addition to the financial scoring, complemented by a
qualitative analysis if :
The financial score is > 5
The local authority debt volume is > 20 M euros
The ratio requested amount / outstanding local debt is > 20 %
1Financial
7 is the lowest score
January 17
scoring is based on 3 criterias :
Solvency
Budget sustainability
indebtedness
12
A Stringent Credit policy
Membership, loan granting and theoretical loan pricing are subject to AFL internal scoring and credit analysis
I
II
Stringent membership and credit policy
Ceiling applicable to loan extension and
diversification of the loan portfolio
Membership only possible for Local
Authorites qualifying a minimum score
Maximum lending limited to 50% of a
member’s outstanding debt1
Membership and guarantee
undertakings necessary to be able to
get a loan
Distribution of vanilla loans only to local
authorities:



III
I
Loan pricing depends on each member
local authority’s credit quality
Pricing based on
a central margin +/- 30 bps
according to the internal score of the local
authority
Short term facilities
Mid-term and Long-term fixed and variable loans
No structured products
Refer to Appendix 4 for more details
1
non applicable for local authorities under 10M€ debt
January 17
13
Asset-Liability management policies
Hedging of interest and
currency risk
Low liquidity risk
Conservative investment policy
Objective
Significant Liquidity Buffer
Liquidity Requirement
Immunize AFL from undesired exposure to
changes in interest and currency rates
Objective of 12 months net cash requirement
Invested in liquid and ECB eligible assets
70% minimum investment into HQLA securities
Full ECB-elegibility of the loan portfolio
Strong credit profile
Hedging essentially with Swaps
Limited transformation
Maximum 1-year gap between the average life
maturity of assets and the average life maturity of
liabilities
January 17
Highly rated securities
Mainly issued by Supranational Institutions,
Sovereigns and governement related
entities from the European Economic Area
and North America
14
A Strong and Stable Shareholder Base
In case of changes in the field of
competences of a member local authority
Financial position impact *
Improved financial position *
Worsened financial position *
Local authority
classified as a Sleeping
Member
If the local authority
does not pay an
additional ICC*
due to the new
competences
Cannot receive fresh
loans neither nor sell its
shares
* Initial capital contribution
January 17
… thus the local
authority is classified as
a Sleeping Member
If the local authority
pays an additional ICC
due to the new
competences
… thus the local
authority maintains its
eligibility as a FullyOperating Member
In case a member requests to leave
• Each member’s capital contribution is for a
minimum 10-year period. Following the 10-year
lock-up period, no member will be allowed to
leave Agence France Locale unless it has fully
repaid its loans;
• Similarly, all members shall remain guarantors
of Agence France Locale up to the level of their
outstanding loans with Agence France Locale
(principal, interest and incidentals) until they have
fully repaid their loans;
• Should a member request to leave, Agence
France Locale - Société Territoriale will not
automatically redeem the shares held by the
leaving member. The member is requested to find
a new shareholder approved by the Agence France
Locale - Société Territoriale’s Board of Directors to
acquire its shares.
15
Contents
I
Characteristics and
financial
framework
January 17
II
Operational
activities and
Development
III
Financial
Objectives and
Funding Strategy
16
Member local authorities of the Agence
France Locale Group
As of 31 August 2016, the Agence France Locale group had 161
members
Main cities and intercommunal
City of Grenoble
City of Marseille
Metropolis of Bordeaux
Metropolis of Brest
Metropolis of Lille
Metropolis of Lyon
Metropolis of Marseille
Metropolis of Nantes
Metropolis de Rouen
Metropolis of Strasbourg
Metropolis of Toulouse
Departments
Department of Aisne
Department of Ariège
Department of Essonne
Department of Savoie
Department of Meuse
Region
Region of Pays de la Loire
The Outstanding Debt of Members Local Authorities is
equivalent to approximatively 13 % of total outstanding
debt of French local authorities
January 17
17
Main balance sheet items as of 30 June
2016
IFRS K€
Customs loans and receivables
590
Debt represented by security
1367
Liquidity reserve
847
Equity
96
Cash collateral paid
34
Cash collateral received
6
Others assets
76
Others liability
78
Total
1547
Total
1547
Ratios:
LCR : 4402%
NSFR : 283%
CET1 : 32,63%
Leverage : 5,48%
January 17
18
Paid-in Capital and Loans Granted to Local
Authorities by scoring
Committed ICC1
Distribution by rating
124 loans granted as of 30 June 2016
Oustanding Loans
Exposure amount: 585.9 M€
Commited ICC: 122.8 M€
30/06/2016
30,3%
30/06/2016
52,52%
25,8%
22,5%
14,1%
20,13%
7,1%
12,04%
10,26%
5,05%
0,00%
0,1%
1--2
2--3
3--4
4--5
5--6
6--7
The weighted average rating of the committed capital was 3.87 as at 30 June 2016.
1Initial
1--2
2--3
3--4
4--5
5--6
6--7
The weighted average rating in the notional amount was 3.36 as of 30 June 2016
capital contribution
The ratings used for the purpose of the graphs are the financial ratings of member local governments of
Agence France Locale, which are not weighted either by socio economic factors or by a qualitative analysis.
January 17
19
Strong Capital and Liquidity position
In June 2016, Agence France Locale - Société Territoriale
completed its 10th capital increase
Agence France Locale also enjoys a sound liquidity position
 LCR: >4000 %
 Commited Capital: €123.83 million
 CET1 Ratio: >30%
 Leverage Ratio: >5 %
Source: AFL
January 17
 NSFR: >200 %
Source: AFL
These indicators favourably underpin the creditworthyness of
AFL, which is rated Aa3 (stable)/P-1 by Moody’s
20
Liquidity Reserves of Agence France
Locale as of End October 2016
Our Bond Portfolio:
Our total liquidity reserves:
AAA
14%
Distribution by geographical location
A
4%
A+
19%
AA+
9%
Supra
1%
Americas
7%
Asia
7%
AA4%
CASH
30%
AA
50%
BONDS
70%
Distribution by counterparty type
Other
5%
Sub Sovereign
26%
LGFA
42%
January 17
Distribution by LCR classification
Corporate
5%
Supra
2%
State Guaranteed
22%
Financials
3%
Public Sector
95%
Europe
85%
Non-HQLA
12%
Non-HQLA
12%
HQLA 1
70%
HQLA 2A
18%
HQLA
88%
21
Contents
I
Characteristics and
financial
framework
January 17
II
Operational
activities and
Development
III
Financial
Objectives and
Funding Strategy
22
Agence France Locale’s 2015
Inaugural Bond issue
AFLBNK<GOV>
65 investors participated in Agence France Locale’s inaugural
bond issue
Order book closed in excess of EUR 1.3 bn
Size
EUR 750 million
Documentation
EMTN programme
Trade Date
24 March 2015
Maturity date
20 March 2022 (7-year)
Coupon
0.375% annual ACT/ACT
Reoffer Spread
MS+2,2 bps, OAT+22 bps
Reoffer Price
99.671%
Yield-to-Maturity
0.423%
Distribution by geography
10%
16%
18%
17%
Asia
Nordics
Other Europe
Distribution by type of investors
6%
Central Banks and official institutions
Fund managers
13%
45%
 the biggest order was only EUR 75 million and no investor took more
than 10% of the amount of the issue;
Germany, Austria and Switzerland
Benelux
17%
High diversification of the order book
16%
Insuers and pensions funds
banks and private banks
20%
January 17
22%
France
corporates
23
Agence France Locale’s 2016 Issue
AFLBNK<GOV>
Size
Documentation
Trade Date
Maturity Date
Coupon
Reoffer spread
Reoffer price
Yield-to-Maturity
EUR 500 Million
EMTN programme
11 May 2016
8%
0,250% annual ACT/ACT
Benelux
Germany, Austria
UK
99,62%
0,31%
15%
50 investors participated in Agence France Locale’s bond issue
Nordics
25%
Other Europe
Distribution by type of investor
12%
70% of foreign investors
13%
Fund managers
43%
Order book closed in excess of EUR 800 million
Banks and private banks
Insurers and pensions funds
32%
January 17
30%
16%
OAT + 31bps
France
6%
Central Banks and Official Institutions
24
Agence France Locale’s 2017 Tap
AFLBNK<GOV>
Size
EUR 250 Million
Documentation
Trade Date
8%
23/01/2017
Maturity Date
Coupon
8%
EMTN programme
Germany & Austria & Switzerland
31%
0,250% annual ACT/ACT
Reoffer spread
Reoffer price
Yield-to-Maturity
OAT + 27bps
20%
0,396%
Benelux
Asia
22%
99,117%
France
11%
0%
Nordics / UK
Other Europe
Southern Europe
Distribution by type of investor
70% of foreign investors
31%
23%
Central Banks & Official Institutions
Fund Managers
Order book closed in excess of EUR 350 million
11%
Insurers & Pension Funds
35%
Banks & Private Banks
January 17
25
Aggregate distribution of bond issues
2015, 2016 and 2017 tap
Distribution by type of investors
3%
8%
8%
30%
31%
31%
22%
11%
14%
20%
France
Fund Managers
Germany, Austria & Switzerland
Banks and Private Banks
UK & Nordics
Insurers & Pension Funds
Southern Europe
January 17
23%
Asia
Central Banks & Official Institutions
Other Europe
Corporates
26
Comparables of Agence France Locale French public banks
AFLBNK 0.375 03/20/2022
AFL benefits from a fair spread compared to those of its French peers (AFD and BPI France)
ASW Spread vs AFD and BPI
AFLBNK 0.375 03/20/2022 Govt
AGFRNC 2.125 02/15/2021 Govt
Spread AFL vs OAT
OSEOFI 2.375 04/25/2022 Govt
35
ASW Mid (bps)
20
15
30
10
25
5
0
20
-5
15
-10
10
-15
-20
-25
January 17
5
0
27
Comparables of Agence France Locale French public banks
AFLBNK 0.25 03/20/2023
AFL benefits from a fair spread compared to those of its French peers (AFD and BPI France)
ASW Spread vs AFD and BPI
Spread AFL vs OAT
35
30
25
20
15
10
5
0
January 17
28
Comparables of Agence France Locale
French Local Authorities issuers
AFLBNK 0.25 03/20/2023
Local Authority Issuance Spreads
85
ISSUANCE SPEAD vs OAT (bps)
80
Aix-Marseille-Provence Métropole
75
Departement de la Gironde
70
Departement des Bouches du Rhone
65
Departement du Bas-Rhin
60
Departement du Puy-de-Dome
Region Auvergne-Rhône-Alpes
55
Departement du Val d'Oise
50
Ville de Paris
Region Bretagne
45
Region Ile de France
40
Region PACA
35
Region Pays de la Loire
30
Ville de Lyon
25
Ville de Marseille
AFLBNK
20
Ville de Paris
Region Ile de France
Ville de Rennes
15
0
5
10
15
20
25
30
AFLBNK
MATURITY (TENOR in YEARS)
January 17
29
Two debt issuance programmes run by AFL
A multicurrency EURO 3bn
EMTN programme that
allows to issue medium to
long term notes in various
currencies in the form of
public or private placement
transactions
January 17
A short term EURO 1bn ECP
programme
• Issuance in various
currencies for maturities up
to 1 year
• STEP registered (eligible as
collateral for open market
operations of the ECB)
30
Borrowing programme for 2017
Up to EUR 900 million of
medium to long term funding
• Euro benchmark
• Opportunistic private
placements
• Taps of existing Euro
bonds
• Other currency public
transactions
January 17
Up to EUR 200 million of short
term funding in the form of
ECP transactions
31
January 17
32
Your Contacts at Agence France Locale
(1/3)
Yves Millardet
Thiébaut Julin
Chairman of the Executive Board
Chief Financial Officer and member
of the Executive Board
Yves Millardet has spent his entire career in financial
advisory to the local sector and in investment banking as a
front office operator in the interest rate and debt markets. He
began his investment banking career at CDC in 1996 and
subsequently joined ABN AMRO in 2001 and Natixis in 2007,
where he occupied various positions such as Bond
Originator and Senior Banker covering the public sector in
both France and Europe. Having advised French local
representatives' associations on the agency concept for local
authority funding, he joined Agence France Locale in
December 2013 as Chairman of the Executive Board.
+33 (0)4 81 11 29 33
+33 (0)4 81 11 29 27
[email protected]
January 17
Thiebaut Julin held the position of Senior Banker for the
international public sector at Natixis, notably covering
sovereign clients, multilateral development banks and
central banks, thus following on from his previous
position as debt product originator for the public sector
in both France and Europe. Thiébaut previously held
various asset management positions for third parties,
notably at Daiwa Securities, before spending 7 years
between 1998 and 2005 at the African Development
Bank as head of funding. He joined the Executive Board
of Agence France Locale in June 2014, heading up the
Finance Department.
[email protected]
33
(2/3)
Philippe Rogier
Ariane Chazel
Credit Director and member of the
Executive Board
Chief Risk Compliance and Control
Officer and member of the Executive
Board
Philippe Rogier is a renowned expert in the field of local
public finance. Having headed FCL, the market leader in
financial advisory to local authorities, for nearly 10 years,
he returned to the banking sector and was notably a
member of the Executive Committee of BFT, a bank of
the Crédit Agricole Group specialised in local
government financing, where he was responsible for a
credit activity dealing with €2 billion per year. In
December 2013, he joined the Executive Board of
Agence France Locale, where he has particular
responsibility for credit, commitments and local authority
relationships.
January 17
Ariane Chazel is a graduate of Ecole Polytechnique,
ENSAE and EHESS, and has a deep understanding of
the banking industry, its environment and its risks. She
started her career in the marketing department of La
poste, with the responsibility of saving and investment
products for financial institutions. Then, she joined Caisse
des Dépôts Group where she successively was financial
engineer in the structuration group of IXIS and after,
member of the team in charge of the strategy of the
wholesale banking at Natixis. Finally, she was in charge
of the scarce resources team at Natixis, before joining
Agence France Locale in September 2015 as a Chief
Risk and Compliance officer.
+33 (0)4 81 11 29 32
+33 (0)4 81 11 29 34
[email protected]
[email protected]
34
(3/3)
Romain Netter
Executive Director - Medium and
long-term funding
Romain Netter has spent most of his career in
investment banks as a front office operator in
the interest rate and debt derivatives market.
He began his career at Crédit Lyonnais (today
CACIB) in 1998 before joining CDC Marchés
and Natixis, where he held various positions
including interbank sales, EMTN dealing and
bond origination. His responsibilities have led
him to work in several financial centres
including Paris, London and Hong Kong.
Following his position as a bond originator
specialised in the French public sector, he
joined Agence France Locale in May 2014 as
Manager of the medium and long-term funding
unit within the Finance Department.
Raphaël BellanPayrault
Executive Director - Treasury
and short-term funding
Before joining Agence France Locale in
November 2014 as Executive Director,
Treasury and short-term funding within the
Finance Department, Raphaël Bellan-Payrault
spent 6 years, from 2008 to 2014 with the
African Development Bank where, among
other roles, is has been Head of investments
between 2011 and 2014. He started is
professional carrier in 1999 at CDC-Marchés
(now known as Natixis) where he has held
different positions as a fixed-income trader
over a 8-year time period.
Flavien Douetteau
Amandine Deguin
Executive Director - Asset and
liability management
Communication Manager
As a University Paris Dauphine graduate,
Flavien Douetteau has extensive knowledge of
ALM in Europe and the United States. Flavien
began his career at Schroders in Paris in
charge of product development, before joining
the BNP Paribas Group in 2008. As a ALM
manager in Paris, he became in 2013 Head of
the liquidity management within Bank of the
West in the United States. He notably
supported the new regulatory indicators
management strategy and the implementation
of new US regulations on Bank Holding
Companies. He joined Agence France Locale
in June 2015 as Head of ALM.
Amandine joined Agence France Locale on its
creation, in 2013 as the communication
Manager. Upon joining Agence France Locale,
she worked during 2 years for a business
cluster, Cap Digital where she has developed
a communication for the French local public
sector, companies and the public at large.
Then she worked for the Association of French
Mayors' communication service. Amandine is
a graduate of University Paris Dauphine in
Political Science and of the French Press
Institute in Communication.
+33 (0)4 81 11 29 40 / +33 (0)6 14 18 45 12
+ 33 (0)4 81 11 29 43
+33 (0)4 69 84 81 01
+33 (0)4 81 11 29 31
[email protected]
[email protected]
[email protected]
[email protected]
January 17
35
Address and links
Website:
www.agence-france-locale.fr
LinkedIn profile:
LinkedIn
Twitter account:
@AgenceFRLocale
January 17
36
January 17
37
Appendices
January 17
Appendix 1
Exerpt from the law on the creation of Agence France Locale
Appendix 2
The first call guarantee mechanism
Appendix 3
Constant strenghtening of Agence France Locale’s equity
Appendix 4
The budgetary «Golden Rule » for French local authorities
38
Appendix 1:Exerpt from the law on the
creation of Agence France Locale
French Law no. 2013-672 of 26 July 2013 covering the separation and regulation of banking activities in Article 35 allows, subsequently codified in Article L. 1611-3-2 of the French
CGCT (General Local Authorities Code), French local authorities to create a public company in the form of a limited company (société anonyme) governed by Book II of the French
Commercial Code, whose corporate mandate is to contribute to their funding through a dedicated subsidiary company:
"After
Article
L.
1611-3
of
the
General
Local
Authorities
Code,
Article
L.
1611-3-2
is
inserted,
worded
as
follows:
‘Art. L. 1611-3-2. amended by Law No. 2015-991 of 7 August 2015 - Local authorities, tax-raising intercommunal cooperation public entities (EPCIs à fiscalité propre) and
Etablissements publics territoriaux may create a public company in the form of a limited company (société anonyme) governed by Book II of the Commercial Code in which they hold
100% of the share capital and whose corporate mandate is to contribute to their funding through a dedicated subsidiary company. This company and its subsidiary shall perform their
activities exclusively on behalf of the local authority members, tax-raising intercommunal cooperation public entities (EPCIs à fiscalité propre) and Etablissements publics
territoriaux. This financing activity shall be carried out by the subsidiary using resources mainly generated by issues of financial instruments, excluding resources received directly from
the State or resources guaranteed by the State.
In derogation of the provisions of Articles L. 2252-1 to L. 2252-5, L. 3231-4, L. 3231-5, L. 4253-1, L. 4253-2 and L. 5111-4, local authorities, tax-raising inter-communal cooperation public
entities (EPCIs à fiscalité propre) and Etablissements publics territoriaux are authorised to guarantee all of the subsidiary's commitments up to the amount of their own
outstanding loans with said subsidiary. The conditions for the application of this guarantee are specified in the articles of association of the two companies.' "
January 17
39
Appendix 2 : The first call guarantee
mechanism
The Members' Guarantee and the Agence France Locale - Société Territoriale Guarantee are both independent first call guarantees under Article 2321 of the Civil Code: they
benefit holders of all securities issued and contracting parties of all acts concluded by Agence France Locale with the provision that these securities or acts shall apply based on
the Guarantee of Agence France Locale or the Members' Guarantee:
"The independent guarantee is the undertaking by which the guarantor is bound by virtue of an obligation entered into by a third party to pay an amount either on-demand or in accordance
with agreed terms.
The guarantor is not bound in the event of explicit abusive or fraudulent behaviour by the beneficiary or in the event of the latter colluding with the instructing party. The guarantor may not
claim any exception against the guaranteed obligation.
Unless agreed otherwise, this security does not follow the guaranteed obligation."
January 17
40
Appendix 3 : Constant strenghtening of
Agence France Locale’s equity
• Each new local authority becomes a member through an initial capital
contribution (ICC), valid for the entire duration of its membership
Share capital 100% held by local
authorities
• The amount of this ICC is calculated based on the local authority’s
economic size:
• Max[0.8%x(total outstanding debt) ; 0.25%x(total operating revenues)]
• No member can become a major shareholder (quick and significant
capital dilution)
+
Annual profits added to retained
earnings
• Pay-out ratio of 5% maximum
• Objective to strengthen the capital base as a priority
=
Regulatory capital
January 17
41
Appendix 4 : The budgetary «Golden
Rule » for French local authorities
In its public report on local government finances published in October 2013*, the Cour des Comptes (National Court of Auditors) highlighted that local authorities “[...] represent in practice
a sub-sovereign risk due to the golden rule: they must ensure that they are able to make capital repayments on their loans from their own resources and may only borrow to finance their
investment needs. Compliance with this rule is guaranteed by the statutory budgetary audit mechanism involving regional and local Courts of Auditors acting at the behest of the State
representative. It notably includes a procedure for rectifying excessive deficits in the accounts"
This rule ensuring balanced budgets is notably codified in Article L.1612-4 of the CGCT:
"The local authority budget is balanced when the operational and investment sections are both balanced and approved, with revenues and expenditures assessed in a faithful manner
and when funding from the revenues of the operational section to the investment section, added to this section's own revenues (excluding proceeds from borrowings) and to depreciation
and provisions, provide sufficient resources to cover annual capital repayments falling due during the financial year."
Article L.2331-8 of the CGCT states that proceeds from borrowings represent one of the non-tax revenue items of the investment section in local authority budgets. Borrowings
correspond to long-term debts taken out during the period. Borrowings may also only be used for funding investment requirements and must be differentiated from short-term debts,
which only cover annual requirements and which are not included in the budget.
January 17
42
January 17
43

Investor Presentation - Agence France Locale

Transcription

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