ANNUAL REPORT 2021 20 CFM Indosuez Wealth Management
For more than 145 years , the hi s tory of our f i rm has resonated wi th the entrepreneurs and fami l i es we have advi sed around the wor ld. Today , we support our cus tomers , he lping them to bui ld, manage , protect and pass on the i r asset s .
3 01 5 CRÉDIT AGRICOLE GROUP 02 9 INDOSUEZ WEALTH MANAGEMENT 10 Company profile: Our network and our key figures 12 General Management Committee 13 The rewards 15 Message from the General Management of Indosuez Wealth Management Group 16 Customer Project 18 Societal Project 20 Human Project 22 Digital transformation 24 Macroeconomic Analysis 03 27 CFM INDOSUEZ WEALTH MANAGEMENT ACTIVITY REPORT 29 CFM Indosuez Wealth Management 30 The Monegasque Environment 2021 33 Message from the Directors 34 Message from the Executive Directors 35 Wealth Management 37 Human Project 38 Corporate Governance 40 Key figures 42 Report of the Board of Directors 48 Resolutions for the General Shareholders’ Meeting 04 53 CFM INDOSUEZ WEALTH MANAGEMENT ANNUAL FINANCIAL STATEMENTS 54 Statutory Auditors’ report 58 Consolidated financial statements at 31 December 2021 154 Individual financial statements at 31 December 2021 171 Offices TABLE OF CONTENTS Annual Report 2021
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Crédi t Agr i co l e Group 5
PUBLIC 100% 25% 29.3% INSTITUTIONAL INVESTORS 7.3% INDIVIDUAL SHAREHOLDERS 5.1% EMPLOYEE SHARE OWNERSHIP PLANS (ESOP) 2.8 % (1) TREASURY SHARES REGIONAL BANKS 11.2.million MUTUAL SHAREHOLDERS who hold mutual shares in 2,406 LOCAL BANKS 39 REGIONAL BANKS together holding the majority of the capital of CRÉDIT AGRICOLE S.A. via SAS Rue la Boétie (2) Sacam Mutualisation Fédération Nationale du Crédit Agricole (FNCA) Political link HOLDING 44,5% HOLDING 55,5% (1) Treasury shares including share buybacks in 2021 that will be cancelled in 2022. After the cancellation of 87,673,241 shares, treasury shares will be insignificant and the holding of SAS Rue de la Boétie will increase to approximately 57%. (2) The Regional Bank of Corsica, 99.9% owned by Crédit Agricole S.A., is a shareholder of Sacam Mutualisation. MAJOR CUSTOMERS SPECIALISED FINANCIAL SERVICES COMMUNITY BANK SPECIALISED ACTIVITIES AND SUBSIDIARIES MANAGEMENT OF SAVINGS AND INSURANCE Créd i t Ag r i c o l e Group i nc l ude s Créd i t Ag r i c o l e S . A . , a s we l l a s a l l t h e Re g i ona l Bank s and Lo ca l Bank s and t h e i r s ub s i d i ar i e s . 6 THE GROUP Crédit Agricole
7 47 countries 10th in terms of the size of its balance sheet (5) 53 million customers 9,500 branches including 7,400 in France (regional banks and LCL) (1) Source: Challenge 2021, Crédit Agricole Group scope. (2) Internal source: ECO 31 December 2021 (3) Source: L'Argus de l'assurance (French insurance industry monitor) 2021. (4) Source: IPE "Top 500 Asset Managers" June 2021. (5) Source: The Banker 2021. 1st Private employer in France (1) Financing the European economy (2) European Union retail bank based on the number of retail bank customers Asset Manager in Europe (4) Insurer in France based on revenue (3) RANKINGS and key figures WIDE ANGLE
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Indosuez Weal th Management 9
Re c ogn i s ed fo r i t s human and re s o l ut e l y i nt e r na t i ona l charac t e r, Indo s ue z Wea l t h Manag ement b r i ng s t og e t h e r near l y 3 000 EMPLOYEES i n 10 REGIONS around t h e wo r l d EUROPE Belgium · Spain · France · Italy Luxembourg · Monaco · Switzerland MIDDLE EAST United Arab Emirates PACIFIC ASIA Hong Kong SAR Singapore New Caledonia IndosuezWealthManagement is the global wealthmanagement brand of the Crédit Agricole group, theworld's 10th largest bank by balance sheet size*. Shaped by more than 145 years of experience in assisting families and entrepreneurs fromall over the world, Indosuez Wealth Management offers a tailor-made approach enabling each of its customers to preserve and develop their wealth in line with their aspirations. With a global vision, its multidisciplinary teams offer them appropriate and sustainable solutions, combining excellence, experience and expertise. They also strengthen their added value proposition for amore sustainable development and amore responsible economy in cooperation with other Group entities. * (The Banker - 2021). 10 COMPANY profile 1858 Birth of the Suez Canal Company 1875 Birth of the Banque de l'Indochine 1876 Opening of our first private bank in Switzerland (Crédit Lyonnais) 1920 First Luxemburg roots (Birth of the Luxembourgeoise) 1922 Birth of Crédit Foncier Monaco 1975 Creation of Banque Indosuez in France through the merger of Banque de l'Indochine and Banque de Suez et Union des Mines 1996 Banque Indosuez joins the Crédit Agricole Group 2016 Adoption of the single brand: Indosuez Wealth Management 2017 Acquisition of CIC's private banking business in Hong Kong SAR and Singapore 2018 Crédit Agricole Private Banking Services becomes Azqore and joins forces with Capgemini to become a new global benchmark for IT and banking outsourcing services 2019 Completion of the merger between Banca Leonardo and Indosuez Wealth Management and adoption of a single brand: Indosuez Wealth Management 2021 Société Générale's International Private Banking selects Azqore for its back-office and information systems management offering 2021 Indosuez Wealth Management simplifies its organisation and brings together its entities in France: birth of CA Indosuez
VIEW BY GEOGRAPHY ASSET ALLOCATION NET BANKING INCOME (€ mi l l i on s) 824,4 819,7 841,3 2019 2020 2021 ASSETS ENTRUSTED (€ b i l l i on s) 132 128 135 2019 2020 2021 2021 RESULTS With an historic level of €135 billion in assets under management (as at 31/12/2021), Indosuez Wealth Management is one of the world's leading wealth management companies. The significant increase reflects a good commercial dynamic against a backdrop of very buoyant financial markets. Indosuez's value proposition has been strengthened in particular in the credit, real assets and responsible offering segments and has attracted a growing number of new customers. NBI rose sharply to €841.3 million, benefiting from a sustained commercial momentum, the quality of asset management and the positive market trend. It is worth noting the significant increase in credit income due to the growth in financing. Over the full year, underlying net income Group share reched its highest level since 2013 at €103.5 million. Diversified asset allocation, reflecting our ambition to protect and grow our customers' assets. Good diversification of customer assets, bolstered by multiple growth drivers. 11 9+8+36+43+1+3+T 9% 8% 36% 43% 1% 2% Europe (incl. Switzerland and Monaco) Asia Pacific Africa / Middle-East France EasternEurope and former CIS Latin America 20+26+17+16+3+15+3+T 16.5% 3.3% 20.3% 26.1% 15.6% 14.8% 3.5% Other (including Private Equity) Life Insurance Structured products Cash assets Funds Shares Bonds
12 Olivier Chatain Chief Executive Officer, CA Indosuez Wealth (Europe) Julie de La Palme Head of Marketing and Communications, CA Indosuez Isabelle Denoual Frizzole Global Head of Compliance, CA Indosuez Pierre Masclet Deputy Chief Executive Officer in charge of business development, CA Indosuez Jean-François Deroche Chief Executive Officer, CA Indosuez (Switzerland) SA Olivier Przydrozny Head of Organisation and Information Systems, CA Indosuez Jean-Christophe Droguet* Head of Audit and Inspection, CA Indosuez *permanent guest Guillaume Rimaud Chief Executive Officer Business Unit France, CA Indosuez Pascal Exertier Chief Executive Officer, Azqore Mathieu Ferragut Chief Executive Officer, CFM Indosuez Wealth Romain Jérome Chief Digital Officer, CA Indosuez Andras Takacs Head of Risk and Permanent Control, CA Indosuez Henri Tran Head of Finance & Strategy, Corporate Secretariat & Legal, CA Indosuez Marie Delesalle Head of Front Office Assistants, CA Indosuez Jacques Prost Managing Director CA Indosuez Anne-Laure Branellec Head of Human Ressources, CA Indosuez Bastien Charpentier Deputy Chief Executive Officer in charge of operations, CA Indosuez General Management COMMITTEE
13 Rapport d’activité 2021 CA Indosuez (Switzerland) SA REWARDS obtained MONACO LUXEMBOURG
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15 MESSAGE FROM THE GENERAL MANAGEMENT of the Indosuez Wealth Management Group The year 2021 wasmarked by economic catch-up, expansionarymonetary policies and favourable financial market trends, but it was also hampered by accelerating inflation and rising geopolitical uncertainties. In this context, which continues to be disrupted by the health crisis, we will recall a positive combination of resilience and change at Indosuez. Indeed, our Company has been able to consolidate its foundations, prove its usefulness to its customers and to society, and achieve a solid performance while pursuing its path towards transformation. Despite the demands of our environment, the talent, expertise and commitment of our employees, as well as their ability to build together, have once again proved their worth in the many key projects that make up our business plan. On the Customer Initiative, the very significant enhancement of our value proposition, particularly in collaboration with other Crédit Agricole Group entities, has borne fruit. This is illustrated by our very good collection level, which ismore than double that of last year, as well as the high level of customer satisfaction confirmed in the engagement and recommendation survey (IRC) carried out for the first time in all areas wherewe have a presence. The technological partnership signedwith Société Générale's International Private Bank is also amajor new step for Azqore and reinforces its position as the leading IT/Back Office platform in the private banking sector. As regards the Human Resources Project, the proactive action plans in favour of gender diversity, personal development and the feedback culture have been deployed with the support of many employees who have expressed their satisfaction. On these subjects, the health crisis will also have been a real catalyst for the transformations carried out. The Societal Project currently expresses Indosuez's commitment and convictions in favour of amore sustainable environment and amore responsible and inclusive economy. This is demonstrated, for example, by the tripling of the funds collected through our responsible offering and the transparency offered to our customers, who now have access to the ESG rating of their portfolio, drawn up by Amundi. In addition to these examples of progress made on the three components of the Group's project, our transformation is also taking shape in terms of the digitisation of our offering and our processes, as well as the strengthening of our operational efficiency. While these changes have contributed to our resilience, they also provide us with a more sustainable growth base to meet the challenges of our sector. The year 2022 opens in an unprecedented context of multiple uncertainties. More than ever, Indosuez teammembers will remain mobilised and will combine their expertise to analyse, adapt their advice and support all our customers on a daily basis. In order to serve thembetter whilemeeting the challenges of our environment, wewill also open the pages of a newbusiness plan, nourished by their confidence, that of our partners and our shareholder, but also by our spirit of innovation. Pierre Fort Chairman CA Indosuez Jacques Prost Chief Executive Officer CA Indosuez
16 IN A COMPLEX HEALTH CONTEXT COMBINED WITH BUOYANT MARKETS, HOW WOULD YOU ANALYSE 2021 ’S COMMERCIAL DYNAMICS? The wealth management sector as a whole experienced very buoyant activity, driven in particular by strong financial markets, a monetary policy that remained very accommodating and a historic year formergers and acquisitionsworldwide. The balance sheet that we have established at Indosuez is also very positive with, in particular, a doubling of net inflows. It is a testament to the quality of our offering and our management, but also to the relevance of our holistic and creative approach. This value proposition has been endorsed in our first international customer survey and recognised by our peers through awards in Europe and Asia. Last year, the Indosuez brand attracted a growing number of families and entrepreneurs who joined us and entrusted us, for some of them, with very substantial amounts of assets. To better serve them andmeet their expectations, we have strengthened the teams dedicated to the UHNWI segment and worked more closely with the Crédit Agricole Group's other specialised businesses. YOU TALK ABOUT THE SUCCESS OF YOUR OFFERING. WHAT MAKES IT DIFFERENT? Our model is based on the unique combination of experience and expertise of nearly 500 employees dedicated to the offering. Day after day, we strive tomeet the expectations of our increasingly sophisticated and diversified customers, closely linked to the changes in their profile and the path of the world around us. Increasingly international, tech-savvy, autonomous, philanthropic, next-gen, etc., they express different needs that our teams are anticipating and meeting. In addition, our environment, which some call a VUCA world - standing for Volatility, Uncertainty, Complexity and Ambiguity - invites us to serve as a compass for our customers and to address Supporting our customers with a holistic and creative approach CUSTOMER PROJECT major challenges. Among these, I wouldmention digitisation, the development of attractive investment solutions in a context of sustainably low interest rates, the integration of themegatrends revolution (circular economy, 5G, artificial intelligence, robotisation, etc.) into our management choices, and action in favour of a more sustainable environment and a more responsible and inclusive economy... Our offerings are becoming increasingly successful because we are working to integrate all these components. With the knowhow and talent of our experts, we aim to continuously improve our value proposition. For example, for our customers who prefer to delegate themanagement of all or part of their assets, we have transformed our discretionary management system, which is part of a culture focused on performance, customer service and long-term investment. In particular, we have opened up our portfoliosmore to the Group's experts and adopted a more active management style and newdirections, particularly with regard to environmental and social issues and major secular trends. Depending on the geography, we also offer Structured Products and Private Equity mandates. For themore seasoned customerswho are often looking for solutions at the frontier of investment banking, we offer market solutions through our Capital Markets Solutions experts. I amthinking in particular of over-the-counter (OTC) derivatives reserved for "professional investors" in the regulatory sense of the term, complex structured products and opportunities in the foreign exchange and commodities markets. For a large number of customerswhowish to diversify their wealth into real assets, we have further strengthened our Private Equity and property offerings. Thus, since 2020, Indosuez has been offering its customers practical opportunities to support promising companies and is among the top 100 global private equity investors according to the annual Private Equity International ranking. We have received several awards in recent years, particularly in Asia. These are just a few examples, which naturally complement the customised, highly specialised and, if necessary, international legal and tax advice. Pierre Masclet Deputy Chief Executive Officer, Indosuez Group Expe r t i s e • Qua l i t y Innovat i on • Int e rnat i ona l
17 IS ASSET ENGINEERING STILL AT THE HEART OF A WEALTH MANAGEMENT BANK'S OFFERING? A global and holistic approach inevitably integrates asset structuring. At Indosuez, the components of the added valuewe deliver to our customers depend on their profile, their expectations, their asset diversification and, of course, the economic cycle and the state of the financial markets. They are therefore evolving. For example, in 2021, in the context of the pandemic and our customers' greater search for meaning, we have noted a strong increase in demand for investment in real assets, particularly property and private equity. In all cases, awell-balanced asset portfolio requires precise structuringwith informed advice, particularly in viewof the regulatory inflationof recent years.We consider that it is our duty as a private banker to contribute to the preservation of our customers' assets and to support them in their architecture. So, logically, we are seeing an increasing number of customer appointments made each year by our wealth engineering experts. HOW SHOULD YOUR FINANCING PROPOSAL BE QUALIFIED? We have an attractive complex financing offering thanks to the strength of the Group and our agile structure, which enables us to meet themost sophisticated requirements ina responsivemanner. Wearealsoseeinganupwardtrend inoutstanding loans, particularly due to new transactions in the ultra-large customer segment. CAN YOU TELL US ABOUT YOUR APPROACH TO THE MOST AFFLUENT CUSTOMERS? We decided to combine our expertisewith that of Crédit Agricole CIB andwe have jointly created Private Investment Banking (PIB), a teamdesigned to support large family fortunes and holdings on a global scale. The aim is to better understand the needs of decision-makers and family members through a joint business approach and to provide themwith a comprehensive offering. PIB is able tomobilise all the Group's specialists in record time to respond to a particular large-scale problem. For example, managing to bring together Indosuez's financing, M&A and coverage teams from Crédit Agricole CIB in less than 24 hours is a real differentiating factor. Furthermore, being able to respond to this customer segment at all times alsomeans being able to exploit synergies with the other entities of the Group, to innovate and to guarantee impeccable quality. In this way, our dedicated approach to high net worth customers feeds into our standard offering, contributes to our competitiveness and our image in the market. WHAT ABOUT A FEW WORDS REGARDING 2022? The year 2022 is expected to be marked by a volatile market environment against a background of geopolitical and inflationary tensions. Our proactivity in informing our customers, deciphering trends and providing them with innovative solutions to these challengeswill be key. To this end, we are currently strengthening our marketing and distribution capabilities. At the same time, we are accelerating the exploration of new territories that will allow us to broaden our value proposition in the coming months; for example, strengthening our property and Private Equity offering. Finally, the deployment of newdigital tools will be an opportunity to strengthen the customer experience. Our s t rong expe r t i s e , ba s ed on 20 y ear s o f expe r i enc e i n p r i va t e e qu i t y , enab l e s u s t o o f fe r a b road , d i ve r s i f i ed and d i s t i nc t i ve p roduc t rang e t o our l ar g e c u s t ome r ba s e . Our c u s t ome r s have ac c e s s t o one o f t he mo s t c omp rehen s i ve s u s t a i nab l e f i nanc e o f fe r i ng s t hrough an ESG ra t i ng s y s t em on ove r 1 1 , 000 c ompan i e s , a wi de rang e o f SFDR 8- and 9 - ra t ed f und s and g re en s t r uc t ured p roduc t s . I s a b e l l e Ja c ob - Ne bo u t , He a d o f We a l t h Ma n a g eme n t CA I n d o s u e z (Sw i t z e r l a n d ) SA
18 IN 2021, THE COVID-19 CRISIS AND COP 26 IN GLASGOW SEEM TO HAVE HAD THE EFFECT OF REINFORCING COLLECTIVE AWARENESS OF THE CLIMATE EMERGENCY WHICH INVESTORS ARE NOW REFLECTING IN THEIR INVESTMENT CHOICES. WOULD YOU ALSO MAKE THIS OBSERVATION IN 2021? The mere observation of the increase in assets under management on our responsible offerings reflects not only their quality and performance but also the enthusiasm of our customers. They are looking for meaning in their investments and they know that financial operators are essential vectors for directing flows towards projectswith a strongenvironmental and societal impact. Indeed, it is because they are convinced of their role that most major financial institutions have defined a strategy for climate action and the transition to a low-carbon economy. It should also be noted that the ecosystem is structured around an increasingly precise regulatory framework, whether it be European taxonomy, the SFDR (Sustainable Finance Disclosure Regulation), etc. CAN YOU REMIND US OF INDOSUEZ 'S POSITION ON THIS PARTICULAR ISSUE? Indosuez follows the policy pursued by Crédit Agricole, which has been a pioneer inmany respects and has demonstrated its involvement for over 20 years through its various commitments (signatory of the United Nations Global Compact since 2003 and of the Principles for Responsible Investment since 2006, founding member of the Green Bonds Principles since 2014, and a pioneer in climate finance for over 10 years). At the end of 2021, the Group specified its societal project around 3 priorities broken down into 10 commitments: to act for the climate and the transition to a low-carbon economy, to strengthen cohesion and social inclusion and finally tomake a success of the agricultural and agri-food transitions. Indosuez is honouring the objective set out in its business plan to build a comprehensive and innovative offering in favour ofmore SOCIETAL PROJECT sustainable development. To this end, a global line was created in 2019 to strengthen the supply side of our Societal Project and support practical community actions, often carried out by volunteering employees as part of specific tasks or through our foundations in France and Switzerland. In addition, last year we decided to allocate part of our outperformance fees to community-based initiatives. WHAT ABOUT RESPONSIBLE FINANCE AT INDOSUEZ TODAY? Following the launch in November 2019 of the Indosuez Objectif Terre international equity fund (classified as Article 9 under SFDR regulations), which invests in securities of companies involved in the fight against global warming and the preservation of natural resources, we continued to roll out our responsible offering in line with our ambitions. ESG criteria are now integrated into our various supportmethods (Advisory/Management under mandate), our processes for developing and selecting financial products (live securities, investment funds, structured products, private equity), ourmanagement and also our lending policy. We naturally pay close attention to the rating of our funds according to theSFDR regulation classification system. Today, 2/3 of the funds managed by our management companies are rated 8 or 9. Our range of structured products has also been enriched with a number of "green" products, mainly issued by Crédit Agricole CIB, and a Green Structured Products mandate. For example, in the summer of 2021, CFM IndosuezWealth Management, in collaboration with Crédit Agricole CIB, launched an innovative socially responsible finance offer, CFM Indosuez Océano. The campaign was approved by 81 customers and was accompanied by a donation to the Monaco Oceanographic Institute, a key player in the protection of the oceans and a partner of the bank. Finally, ESG criteria have been integrated into the selection of private equity fund managers and are now used in the management process. Since the end of 2021, the periodic portfolio statements commuWorking towards a more responsible and inclusive economy Virginie Bourgeois Head of Sustainable Development and the Societal Project, Indosuez Group Commi tment • Us e f u l ne s s • Impac t
19 nicated to our customers have been supplemented with ESG ratings established by Amundi for all the equity and bond securities in its investment sphere. They will gradually be extended to other asset classes. I would like to point out that the quality of our offering has already been recognised at the 2021 WealthBriefing Asia Greater China Awards, including the awards for Best Bank for ESG andBest Bank for Sustainable and Responsible Investment. While our CSR offering and strategy are recognised by our peers, they are also better understood by our customers thanks to the actions and communication materials we have deployed. For example, a web conference dedicated exclusively to them has been offered, educational documents are available and our experts regularly address the subject in our publications. YOU ALSO MENTIONED THE COMMUNITY SUPPORT INITIATIVES CARRIED OUT BY EMPLOYEES? Indosuez employees are driven by a genuine spirit of responsibility and solidarity to promote the economic, social, environmental and cultural development of their local area. To do so, they benefit from a robust organisation in which their community support is expressed, whether through skills sponsorship or the Indosuez Foundations in France and Switzerland. I would like to briefly point out that for more than 10 years the Indosuez Foundation in France, under the aegis of the Fondation de France, has been supporting practical community projects to help vulnerable people. Nearly 80 associations, including some fifteen social impact start-ups, have benefited from the skills and professional time donated by nearly half of our employees in France. In Switzerland, the Indosuez Foundation has financed 30 environmental projects with a high economic and social impact for vulnerable communities in Switzerland and around the world since 2012. They aim to support local communities through projects that promote the transmission of knowledge, the empowerment of young people and the preservation of natural heritage. With its national corporate volunteering programme (Citizen Days), it offers the employees of the Indosuez Group inSwitzerland (Indosuez and Azqore) the opportunity to develop their multidisciplinary skills every year. HOW DOES THE COMMITMENT OF INDOSUEZ EMPLOYEES CONTRIBUTE TO THE EXPERIENCE YOU OFFER YOUR CUSTOMERS? Behind the voluntary work and commitment of our employees, the usefulness of Indosuez and in particular the usefulness of its Foundations is now recognised in the market and by our customers. It gives us a real legitimacy in philanthropy, especially with the latter. We are developing a very broad know-how in order to be able to support thosewho seek to strengthen their societal impact. Our experience and expertise enable us to advise them in the implementation of their philanthropic plans, from the choice of vehicle to its practical management.. WHAT ABOUT A FEW WORDS REGARDING 2022? In 2022, we will continue to roll out our responsible offering and ESG rating across all asset classes in our investment sphere. Wewill further systematise the inclusion of non-financial criteria in our investment processes and strategies. In the wake of the commitmentsmade by theGroup, in all our entities, all employees will bemobilised to strengthen our usefulness for our customers but also for society, thus participating in a fairer transition. The societal component of our next business plan will undoubtedly be as transformative as it is exciting. Our c ommi tment t o s o c i e t y wa s mark ed by nume rou s event s , i nc l ud i ng par t i c i pa t i on i n t he Bu i l d i ng Br i dg e s Hac ka t hon on t h e t heme o f women and wea l t h manag ement . Nicolas Mougeot, He a d o f G l ob a l Tr e n d s a n d ESG Ad v i s o r y CA I n d o s u e z (Sw i t z e r l a n d ) SA In 2021 , 180 emp l oyee s par t i c ipat ed in Ci t i zen Days in 17 pro j ec t s in Swi t ze r l and . Our Foundat i on a l s o suppor t ed 4 new pro j ec t s in South Af r i ca , Madaga s car, Sr i Lanka and Uppe r Gu inea . Valeria Cholat, He a d o f Commu n i c a t i on s CA I n d o s u e z (Sw i t z e r l a n d ) SA
20 HUMAN PROJECT THE COVID-19 HEALTH CRISIS WILL HAVE BEEN PARTICULARLY HARD ON ORGANISATIONS. HOW DID YOU DEAL WITH IT IN 2021? Our sole objective has always been to safeguard the health of our employeeswhile ensuring that our customers continue to receive excellent service. We have achieved this through the remarkable commitment of our teams, the deployment and adoption of new tools, and changes in theway we organise our work. Thiswas only possible thanks to a strong individual and col lective commitment. Inspired by the two Chinese characters that represent any crisis as a combination of dangers and opportunities, I would also emphasise that the pandemic has also been an extraordinary accelerator of the transformation that is underway, whether it be our capacity to prioritise what is essential, our collaboration methods, our way of managing and motivating, or our ability to make each individual accountable. The hybrid operation between on-site and home-based work is now anchored in our practices. We alsowished to dedicate a special welcome to the 470 employees who have joined us over the last two years, which have been complicated by the health crisis: for the first time in our history, we have therefore organised a worldwide web conference with speeches, testimonials and illustrations. This panoramic yet accurate view of the Indosuez group and its corporate culture was intended to strengthen the knowledge of new arrivals, but also their sense of belonging and cohesion. Facedwith theuncertainty of this unprecedentedhealth situation, the values that are at the heart of our Human Project were further amplifiedbecause itwas essential to takeonmore responsibilities and to act with discernment, without ever forgetting the interests of our customers. In fact, the large number of employeeswho took part in our annual engagement survey shared their satisfaction with the working environment and human relations of our Group, as we have reached the highest level ever. Developing the talents of our employees to serve our customers Anne-Laure Branellec Head of Human Resources, Group Indosuez Re spons ab i l i t y • Deve l opment • Di ve r s i t y
21 TRANSFORMATION IS USUALLY ASSOCIATED WITH INNOVATION. WHAT INNOVATION WOULD YOU RETAIN FROM 2021? For 2021, I would highlight the strengthening of the feedback culture, which is essential for continuous improvement. Convinced that feedback is a tool for individual development and collective performance improvement, we launched a dedicated application accessible to everyone. It makes it possible to ask for and receive personal development feedback in a matter of minutes. It therefore contributes to transforming the businessmodel to serve our customers and to instilling a new, more collaborative corporate culture, encouraging initiative at all levels. THERE IS NO DOUBT THAT FEEDBACK CONTRIBUTES TO PERSONAL DEVELOPMENT, BUT WHAT ABOUT THE TRAINING OFTEN ASSOCIATED WITH CHANGE MANAGEMENT? On themore specific subject of training, one year after the launch of ourDigital Academy, a libraryof onlinecontent and toolsenabling everyone to develop at their own pace, the topics covered have been greatly expanded: languages, office automation, new technologies, CSR and training on the behavioural skills of transformation. Personal development is now a very important issue for Indosuez employees. Since 2021, we have been organising regular events, through dedicated internal communication, on themes that alternate between personal development and strategic issues. Thus, for example, knowledge of theGroup, theAgile culture, the fundamentals of CSR, thecircular economy, well-beingatwork, diversity and inclusion, managerial transition, the importance of feedback, surpassing oneself, etc. Many of these themes can be studied in greater depth by employees at the Digital Academy or as part of dedicated programmes, such as the Agile training given to 140 employees in the Organisation/MOA & Digital business lines of Indosuez and Azqore. CAN YOU REVIEW YOUR COMMITMENTS ON GENDER AND DIVERSITY AND THE PROGRESS MADE IN 2021? The promotion of diversity is at the heart of the Human Project of our business plan. The promotion of gender diversity is a longterm priority. We have specifically reiterated our commitments through an equal opportunities charter. Our leadershipmentoring programme was renewed in 2022. We have also deployed dedicated training courses for female employees at the beginning of their careers, and we have increased the number of women's voices through, for example, profiles that are regularly circulated internally and externally. At the end of December 2021, we had 31%women inmanagement bodies. The relevance of this proactive gender strategy has been recognised with three awards in Europe and Asia over the past year. Furthermore, in a particularly difficult context for younger generations without professional experience, wewanted to facilitate access to the professional world for young graduates and students. More than 120 young people have been immersed in our group through internships, professional training contracts or VIEs (Volunteer for International Experience). WHAT ABOUT A FEW WORDS REGARDING 2022? In a complex and uncertain world, it is the strength of our team that enables us to adapt and transformourselves to bestmeet our customers' expectations.Wewill continue tostrengthen thepower of this collective by ensuring that it is enhanced by the diversity of the profiles and experiences of our Company's women and men. Our ambition is also toencourage individual responsibility to serve this collective. How?By transforming ourmanagement culture, by encouraging initiative-takingandcross-functionality, andby allowing each person to take charge of his or her career by developing both digital and behavioural skills. A l so deve l oped w i t h i n CA I ndosue z (Sw i t ze r l and) SA: Face - to - f ace t r a i n i ng on good p r ac t i ce i n feedback Awa r enes s - r a i s i ng wo r k shops fo r manage r s on i nc l us i ve managemen t Our c ro s s-depar tment a l exchang e p rog ramme , ca l l ed Shadowi ng , wa s s e t up t o s t reng t hen c o l l abo ra t i on b e twe en t eams i n o rde r t o b e t t e r s e r ve our c u s t ome r s . T h i s p rog ramme i s a l s o a l eve r fo r pe r s ona l deve l opment , a t heme t o wh i ch we a t t ach g rea t impo r t anc e . A l i n e K l e i n f e r c h e r, He a d o f Huma n Re s o u r c e s CA I n d o s u e z (Sw i t z e r l a n d ) SA
22 THE HEALTH CRISIS HAS ACCELERATED THE DIGITISATION OF THE BANKING RELATIONSHIP AT A TIME WHEN WEALTHY CUSTOMERS ARE LOOKING FOR HIGHLY PERSONALISED ADVICE. DO YOU THINK THAT DIGITAL AND HYPERPERSONALISATION ARE MUTUALLY EXCLUSIVE? On the contrary! The health crisis has helped to accelerate the digital transformationprocesswhich, at Indosuez, is nowreflected throughout the customer journey and encourages the personalisation of advice and the offering. This includes simplifying the customer's relationship with the bank and removing any administrative constraints. We have set ourselves a clear ambition, to offer our customers a "digital solution enhanced by the human touch". Thus, going digital means offering customers the possibility of a hybrid relationship with their bank, leaving them the choice of when to use it and of an autonomous experience, particularly in the case of "nomadic working". Finally, by allowing bankers and experts to devote themselves to higher value-added tasks, new generation tools, such as the use of RPA (Robotic Process Automation) or artificial intelligence, free up time to give advice. These are just a few examples of how digitisation can be at the heart of strengthening the value proposition and making the customer journey more fluid, which are real challenges for the transformation of our business. CAN YOU GIVE US SOME SPECIFIC EXAMPLES OF THE WORK YOU HAVE CARRIED OUT WHICH NOW CONTRIBUTES TO YOUR CUSTOMERS' EXPERIENCE AND, NO DOUBT, TO THEIR SATISFACTION? DIGITAL TRANSFORMATION As a preamble, I would like to point out that we are benefiting from the opening up of the S2i proprietary banking platform of Azqore, our subsidiary specialising in the outsourcing of information systems and the processing of banking operations for wealthmanagement players, to external solutions. This allows us, for some of our projects, to consider partnerships with specialised and renowned fintechs for the development of very high added value solutions. Among recent achievements which stand out, I would mention the digitisation of the customer questionnaire at the start of the relationship and also an advice platform on financial markets. It will soon allow our customers to view our investment views, explore our investment universe and build a list of preferred securities that can be used by their Advisor. In 2021, we also launched the Startup Connections application, which digitises the process of connecting our investor-customers with Village by CA startups in the fundraising phase. All these tools are deployed or in the process of being deployed depending on geographical area. HOW DO YOU ORGANISE YOUR WORK AT INDOSUEZ TO CARRY OUT THESE INNOVATIVE PROJECTS? Indosuez is driven by a true spirit of innovation, fostered in particular by its Innovation and Digital Transformation department, assisted by a community of Transformers. As both ambassadors and relays of cultural transformation, their mission is to support their "intrapreneur" colleagues by helping them to familiarise themselves with the tools of innovation. To support this dynamic, Indosuez opened the Innovation Lab in 2020, a co-creation facility designed to accelerate its digital transformation by involving its Transforming today and preparing for the world of tomorrow Romain Jérome Chief Digital Officer, Indosuez Group Ag i l i t y • Innovat i on • Trans format i on
23 employees and customers. They are welcomed, for example, to collect their opinions and recommendations on our prototypes or the development of our tools. This was the case, in particular, during the redesign of E/M-Banking. In order to acculturate all employees, Lunch&Learn conferences on innovation-related topics are organised in all Indosuez entities. The year 2021marked a newcultural turning point with the launch of the first ideas challenge, whichbrought together 955employees and led to the emergence of 328 ideas to improve the customer and employee experience. The 5 winning ideas have been developed and more will be developed in the coming months. WHAT CAN YOU TELL US ABOUT THE ONGOING TRANSFORMATION FOR EMPLOYEES? Simplifying, streamlining and automating processes that can be automated certainly improves our operational efficiency and the experience of our employees, but it also inevitably contributes to the quality of service offered to our customers. We also ensure that we maintain our momentum for innovation on multiple topics and that it permeates all levels of our organisation. As an example, we have used artificial intelligence and natural language text generation towrite qualitativemanagement comments in mandate and fund reports. We have also built an Intranet of offerings and products, developed a tool for simplified and digitised access to cross-border rules, and harnessed synergies with the Group's entities as part of the adoption of the Alto management interface. This investment fundmanagement tool developed by Amundi offers managers simple access to a 360° viewof the information required to analyse, monitor andmanage portfolios in order to make investment decisions. These so-called "short-cycle" initiatives are deployed alongside strategic, structuring transformation projects such as CLM (customer lifecyclemanagement tool) and are generally led by Product Owners whose task is to coordinate all those required to create value from their digital product. They are supported by a product team (developers, designers, production, etc.) and take care to gather user feedback in order to develop features with greater added value. They usually operate using agile methods. WHAT ABOUT A FEW WORDS REGARDING 2022? The challenge for 2022 will be to strengthen the adoption of the new tools by customers, bankers and experts for a seamless process. We will also capitalise on successful experiences to further develop innovative ideas, especially those shared during the ideas challenge. And then we will fulfil our primary task of serving all our customers and employees. I am thinking in particular of the services that we will make available to our Next Gen customers or, on the employee side, of the devices that we will help to perfect to increase our operational efficiency. Wi t h a 20% i nc rea s e i n s ub s c r i p t i on s t o on l i ne s e r v i c e s ove r t he y ear, our c u s t ome r s ' appe t i t e fo r t he aut onomy o f fe red by eBank i ng i s c onf i rmed . To da t e , 5 emp l oy e e s have t ak en on t he ro l e o f i nt rap reneur s , mu l t i p l y i ng t he impac t o f our d i g i t a l t ran s fo rma t i on . B a p t i s t e A n c e y , He a d o f I n n o v a t i on a n d D i g i t a l Tr a n s f o r ma t i on , CA I n d o s u e z (Sw i t z e r l a n d ) SA
2021 was a year of recovery that was as dramatic as the depth of the recession in 2020. Behind thismirror effect, there is no return to normal, but an acceleration of already established trends, breaks and changes of model, allowing us to anticipate the year 2022. OVER THE PAST TWO YEARS, THE STORY SEEMS TO HAVE ACCELERATED IN MANY WAYS 2020 saw a record recession triggered in a month, a central bank response orchestrated in days, and complex vaccines deployed in months, against a backdrop of accelerating technological disruption and climate emergency. 2021 also had several surprises in store for us. Between longer procurement times, raw material shortages, and acceleratingwages in theUS, inflation has entered the post-confinement economic landscape as a less temporary parameter than initially anticipated by central banks. This inflationary trend did not weigh on the development of the equity markets, which continued their upward trajectory, supportedby stronger thanexpectedearnings growth. The other disruptive factor in 2021 was of course China: regulatory tightening and restructuring of the property sector weighedheavily on investor sentiment after the euphoria of the beginning of the year. Behind these two phenomena, some structural trends have led the government to act and react: excessive investment in property, declining demographics, rising inequalities, a poorly regulated technology Macroeconomic analysis 2021 REVIEW AND OUTLOOK FOR 2022 financial markets sector, and households with less access to education and health. This is not a challenge to the Chinese model, nor to the secular strengths of this economy (a fast-growing middle class and record investment in R&D), but rather a source of uncertainty to be monitored. There is no doubt that the spectacular images of climate change have contributed to the acceleration of investments in energy transition. In this respect, COP26 may have been disappointing for some, given thebacktrackingof several emergingcountrieson their carbon commitments. However, the return of the US to the climate agreement is an encouraging sign. 2022, THE NORMALISATION OF THE GROWTH OF OUR ECONOMIES IN A TENSE GEOPOLITICAL CONTEXT The year 2022 should first be characterised by a normalisation of the growth of our economies. It was the combination of significant support packages, relaxations of measures put in place during the pandemic and a large stock of savings that were expected to support consumption and investment in mature economies. The war in Ukraine, the duration, risks of extension and exit scenarios of which are impossible to predict, increases the level of uncertainty with threats of a higher slowdown, particularly in Europe, and higher inflation due to the pressure on commodity prices. The impact on inflation of soaring energy prices and supply chain disruptions is expected to ease gradually, but inflation is still expected to be well above the 24 Vincent Manuel Chief Investment Officer Indosuez Group
central bank target in 2022. In particular, risingwages in the US are raising fears of more long-lasting inflation and leading the Fed to react. A cycle of rising rates has begun this year. The Fed and the BoE initiated themove, followed in part by the ECB, which brought forward the end of its asset purchase policy to give itself more roomto raise rates i f necessar y. Monetar y pol icy wi l l remain accommodative, with real interest rates remaining in negative territory, but less favourable than in 20202021, leading almost mechanically to an adjustment in asset valuations. The dollar's strength at the start of the year could gradually dissipate from mid-2022 onwards as markets integrate the rate hikes. In this multi-speed normalisation where the ECB will be in the background, expectations of a strong rebound of the currency may have to be moderated. Emerging countries are preparing or even anticipating this normalisation of US monetary policy. Some are already ahead of the curve, such as the Brazilian and South African central banks, which have raised rates under pressure from accelerating inflation and a weakened currency, at the risk of curbing growth. In this monetary panorama, there is one notable exception, China, which is lowering its rates to strengthen its support for the economy, particularly in the face of the crisis in the property sector and the threat of a resurgence of the epidemic. The main risk of this normalisation scenario is that long-term interest rates could rise too sharply, which would have a negative impact on equity markets and bond risk premiums. The beginning of the year saw some of this riskmaterialise, with theUS 10-year yield reaching 2%, together with a correction in growth stocks and a widening of credit spreads. The other major risk at the beginning of 2022 is obviously the rise in geopolitical tensions in Eastern Europe, leading to both a recession in Europe and a return of volatility to the peaks of 2021. On the corporate side, a return tomore normal levels of earnings growth is expected after the 2021 boom. The downward revision of forecasts automatically leads to a much more moderate growth in profits. In addition, the pressure on rawmaterials is increasing the pressure on margins. Therefore, we believe that the key theme for 2022 will be the sustainability of profit margins and cash flow generation. 25
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27 Act iv i t y Repor t CFM Indosuez Weal th Management
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CFM INDOSUEZ WEALTH MANAGEMENT As the number-one bank employer in Monaco, CFM Indosuez Wealth Management offers financial solutions to private investors, businesses, institutions, and professionals. Created in 1922 by some of Monaco’s leading families, some of whom are still stakeholders, CFM Indosuez Wealth Management is a 70%-owned subsidiary of Crédit Agricole Group. This backing by one of the world’s top banking groups, paired with our deep roots inMonaco, is an essential guarantee of strength and sustainability for our customers, shareholders, employees, and partners. Within the group, our Company is fully integrated in theWealth Management Business, Indosuez Wealth Management. Our 3,000 exper ts in Weal th Management, 376 of whom are at CFM Indosuez Wealth Management in Monaco, create customised solutions for our customers in a country where we operate or by multibooking. Together, they have a single calling: to help families and entrepreneurs create, cultivate, protect, and pass on their wealth, both in the principality of Monaco and internationally. 29
THE ENVIRONMENT in Monaco 2021 30 The year 2021 will have been the year of economic recovery in the Principality, after a year largely impacted by the health crisis. This recovery has been supportedby the significant support measures and the stimulus plan of the Prince's Government. It affects most sectors, but should be put into perspective in comparison with the performance of 2019, a pre-pandemic year. RECORD FIGURES For the first time, Monegasque turnover, excluding financial and insurance activities, exceeded €16 billion. It is 13.3% higher than in 2020, and 6.9% higher than in 2019. This increase is particularlymarked in thewholesale and retail trade sectors. In the hotel and restaurant sector, growth is strong compared to 2020 at +36%, but remains below2019 levels. In property, the average price per square metre has risen by almost 75% over 10 years andhas exceeded50,000euros for the first time, although this sector is the only one to have seen a decline in turnover, with a fall of 32.5% over one year. The development of assets under management by banks is also very positive over the 12 months, at €148.2bn, an increase of 14.8%. In terms of employment, the Principality has shown a clear progression, with the private sector totalling nearly 57,000 active jobs, a level higher than before the crisis. The number of private sector employers stands at 6,308, up 3%over a year. The government's Total Temporary Layoff (CTTR - Chômage Total TemporaireRenforcé) has helped tomaintainwages and links within companies. Some companies, including CFM Indosuez, have chosen to contribute to the national effort by taking on this CTTR measure themselves. THE ENVIRONMENT AT THE HEART OF DEVELOPMENT The Government is actively working to maintain the quality of life in the City-State by initiating a proactive policy in favour of sustainable development. With 39,150 inhabitants and 57,000 employees in a small area of 2km², the Principality is facedwith the environmental problems faced by all major cities in a very concentrated and exacerbated way. The promotion of public transport and electric transport has been further strengthened in 2021. The acquisitionof clean vehicles is encouraged for private individuals as well as for companies and is systematic for administrative services. Selective sorting of waste is promoted, and water management is treated as a key element of the sustainable city. Monaco devotes 20%of its surface area to public and private green spaces. They are managed in an eco-responsible manner, taking care topreservewater resources, limitingchemical treatments and developing biological control. MONACO, A SMART CITY At the end of 2021, the Principality made an initial assessment of three years of developing quality digital infrastructures, for the benefit of the quality of life of its residents, employees and the attractiveness of its economy. In order to aim for digital excellence and increase its international influence, the Principality of Monaco has laid the foundations over the last few years to guarantee an economic influence well beyond its borders: 5G, 10 Gigabit fibre, a digital identity and the State Sovereign Cloud, the first in this field in Europe. Another aspect of the systemput in place is theBlue Fund launched at the end of 2020, as part of the Principality's economic recovery plan, which has made it possible to support more than 350 digital transformation projects, accompanied in 9 cases out of 10 by local digital service companies. The government's ambition is to make Monaco a benchmark City-State in the digital world. To find out more about the economic data of Monaco: visit the website of the Institut Monégasque de laStatistique et des Etudes Economiques (IMSEE), imsee.mc. For more information on government action, visit gouv.mc. Céline Lapaian Corporate Secretary
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