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Consolidated Financial Statements as of December 31, 2015
Notes to the Consolidated Financial Statements
Corporate Treasury and Financing's liquidity management strategy
Bancassurance business
12.6.1.2
consists of:
Carrefour Banque’s liquidity risk is monitored within the framework of
promoting conservative financing strategies in order to ensure that
●
a senior management-approved liquidity strategy that is part of the
the Group’s credit rating allows it to raise funds on the bond and Group’s overall strategy.
commercial paper markets;
Carrefour Banque’s refinancing situation is assessed based on internal
maintaining a presence in the debt market through regular debt
●
standards, early warning indicators and regulatory ratios.
issuance programs, mainly in euros, in order to create a balanced
Liquidity risk management objectives are to:
maturity profile. The Group’s issuance capacity under its Euro
Medium-Term Notes (EMTN) program totals 12
billion euros. Since
ensure that refinancing needs are met, based on monthly
●
2007, the loan agreements for the EMTN program include a soft
assessments of projected cash surpluses or shortfalls over a
change of control clause that would be triggered in the event that a
three-year period performed by comparing static forecasts of
change of control led to Carrefour losing its investment grade rating.
committed financing facilities with dynamic lending forecasts;
In this case, the notes would not become immediately repayable but
gradually achieve compliance with the new Basel
III liquidity
●
the interest rate would increase;
coverage ratios, through a process that is designed to deliver a
using the 5
billion euros commercial paper program on Euronext
●
sustainable improvement in asset quality by investing in a
Paris, described in a prospectus filed with the Banque de France;
dedicated fund eligible for inclusion in the ratio calculation and
extending the maturity of liabilities in order to improve the net
maintaining undrawn medium-term bank facilities that can be
●
stable funding ratio;
drawn down at any time according to the Group’s needs. At
December
31, 2015, the Group had two undrawn syndicated lines
diversify refinancing sources to include bank lines of credit, bond
●
of credit obtained from a pool of leading banks, for a total of
issues, securitization programs, money market issues and customer
3.9
billion euros. Group policy consists of keeping these facilities on
deposits. During 2015, Carrefour Banque carried out two bond
stand-by to support the commercial paper program. The loan
issues to support the financing and development of its businesses
agreements for the syndicated lines of credit include the usual
(Note
5.5.2). The master trust structure allows Carrefour Banque to
commitments and default clauses, including
pari passu
, negative
dynamically manage asset-backed securities series issued by the
pledge, change of control and cross-default clauses and a clause
securitization fund. Within this structure, the 400
million euros
restricting substantial sales of assets. They do not include any rating
serie was renewed for a two year period, from June 2015.
trigger, although they do allow for the pricing grid to be adjusted up
In November
2014, Carrefour Banque secured its refinancing sources
or down to reflect changes in the long-term credit rating. None of
by rolling over its 750 million euros five-year syndicated line of credit
the agreements contains a material adverse change clause.
and negotiating two one-year extension options, one of which was
The Group considers that its liquidity position is robust as it has
exercised during the year, extending the facility's maturity to
sufficient cash reserves to meet its debt repayment obligations in the November
2020. The Group therefore retains an option to extend it by
coming year.
a further year.
The Group’s debt profile is balanced, with no peak in refinancing needs
across the remaining life of bond debt, which averages four years and
four months.
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