BEIJING, March 9, 2021-S&P Global (China) Ratings today assigned its “AAA_spc” issuer credit rating (“ICR”) to Crédit Agricole S.A. (CASA). The Outlook is stable.

Our rating on CASA. one of the largest banks in France, is based on the ‘A+’ issuer credit rating assigned by S&P Global Ratings, and a four-notch uplift through the application of the S&P Global (China) Ratings Panda Bond Methodology.

According to our Panda Bond Methodology, our analysis of foreign issuers typically considers the credit opinion which S&P Global Ratings may have on that issuer. Where a foreign domiciled issuer has stronger credit quality characteristics, such as “BBB” category or above credit quality as determined by S&P Global Ratings, S&P Global (China) Ratings may assign a view of credit quality typically in the range of two to five notches higher than the credit quality opinion of S&P Global Ratings. Under this methodology, the notch uplift above a rating assigned by S&P Global Ratings is based on the broad relationship observed between the credit quality opinions of S&P Global Ratings and S&P Global (China) Ratings.

Our rating on CASA is based on S&P Global Ratings’ view of its credit quality. According to S&P Global Ratings, CASA is a firm market leader in the French retail banking sector, generating good and predictable risk-adjusted earnings. It has an increasingly diverse business model and income sources, with leading franchises, notably in retail banking, insurance, and asset management, while its sound earnings and cooperative status support internal capital generation.

S&P Global Ratings has also found that CASA may have weaker profitability over the next two years from the COVID-19-induced recession. Its economic risk is relatively high in Italy, which the group considers its second home market. Low interest rates weigh on its net interest margins, in line with the rest of the industry, heightening the need to further improve efficiency.

At the same time, S&P Global (China) Ratings has equalized its ratings on CASA’s outstanding senior preferred obligations bonds issued in China with the issuer credit ratings on the issuer.

Rating Score Snapshot:

Issuer Credit Rating and Outlook assigned by S&P Global Ratings: A/Negative

Notches Applied According to S&P Global (China) Ratings’ Panda Bond Methodology: +4

Issuer Credit Rating and Outlook assigned by S&P Global (China) Ratings: AAA_spc/Stable

Related Rating Report:

Credit Rating Report: Crédit Agricole S.A., March 9 2021.

Issue Rating Notice: Crédit Agricole S.A. 2019 Renminbi Bonds (Series 1) Rated “AAA_spc”, March 9 2021.

Issue Rating Notice: Crédit Agricole S.A. 2020 Renminbi Bonds (Series 1) Rated “AAA_spc”, March 9 2021.

Related Criteria and Research

S&P Global (China) Ratings -Panda Bond Methodology;  

S&P Global (China) Ratings General Considerations on Rating Modifiers and Relative Ranking.

Media Contacts:

Sharon Tang, Beijing, (86)10-6569-2988; sharon.tang@spgchinaratings.cn

Analyst Contacts:

Yifu Wang, CFA,CPA, Beijing；yifu.wang@spgchinaratings.cn

Zheng Li, Beijing; zheng.li@spgchinaratings.cn

Longtai Chen, Beijing; longtai.chen@spgchinaratings.cn

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