7 billion euros of net banking product GNP

Banns should be published tonight. It is in effect today, in the wake of the Supervisory Board of the Caisse nationale des Caisses d'Epargne (CNCE) to give its green light to the operation, the squirrel and the Banques Populaires planned to sign the agreement formalizing their marriage. The two mutual had indeed opened in mid-March of the exclusive negotiations to merge most of their subsidiaries trade under a common holding company which would be called NatIxis.

After two and a half months of discussions and only a few days of delay in the deadline they had set on 1 June, the President of the Banques Populaires, Philippe Dupont, and the pattern of Caisses d'Epargne, Charles Milhaud, give this evening the real kick-off of work to lead to its creation, planned here at end of 2006. Seven months are not too much to obtain the regulatory approvals in various countries where NatIxis will be present and to carry out the necessary inputs and market operations.

This approximation, which will involve more than 20,000 employees of the two groups, must give birth to a giant. Bank detail first. Even if the networks of agencies will remain independent, they will be an undeniable strength for shared production plants: together, the 4,700 agencies and Caisses d'Epargne and Banques Populaires chalked weighing 20 France retail banking market. Bank funding and investment, then, where NatIxis is the fourth French player in terms of revenue behind BNP Paribas, Société Générale and Calyon, with 2.7 billion euros of net banking product (GNP). In asset management, where the approximation will give birth to an actor upgrading the Crédit Agricole in terms of stocks of assets managed. In other trades, such as factoring or furniture leasing, where the new set will occupy a leading position. At the controls of the new ensemble, Dominique Ferrero as the No.1 will support two of Crédit Lyonnais, as Director General Philippe Dupont, which will provide the Presidency for the first six years. Anthony Orsatelli, responsible for the activities of bank financing and investment to the Caisse nationale des Caisses d'Epargne, and François Ladam, Executive Director of Natexis, acting also in the Executive Board. Still to appoint a fifth man purported to be the network of the regional Caisses d'Epargne.

Multiple duplicates

On paper, the complementarities between the two groups are promising. Natexis, the bulk of the Banques Populaires Bank, is very present to clients of medium-sized and large enterprises inherited from the national credit and French trade (BFCE) Bank while the links preferred to Ixis CIB, his alter ego of Caisses d'Epargne, with financial institutions dates back to when he was in the fold of the Caisse des Dépôts et Consignations (CDC). Cross-selling should identify for strong revenue synergies.

But the duplicates, if they are rare, are not non-existent. According to the report made by cabinet Secafi Alpha on behalf of the trade unions, they are "important" on the activities of financial markets (front and back-office), on trades of securities of depository and conservation in the support functions (computer, human resources, finance and accounting). Some 600 to 700 jobs would be thus threatened. In a note of March 13, 2006, in the wake of the announcement of the project, the Office of study Keefe, Bruyette & Woods estimated to be approximately 9 of the costs of the combined economies of scale generated by the operation "thanks to the centralization of certain activities such as the changes, options, or the fixed income". They reach 15 Bank financing and investment, to 234 million euros, 9 in management of assets (86 million), 12 in conservation of titles (36 million) and private bank (EUR 14 million). Deemed amounts exaggerated by some given precisely complementarities.