Contents

Findings at a glance

BNPP overview

RBS Vs CIB

Strategy

Competitive Analysis

IT Spends

Latest innovations in CIB

Findings At Glance

BNPP more focused on Retail sector having higher revenues and innovations

But profitability is more on CIB sector compared to RBS

Strategy focused on improving operating efficiency and innovations

#5 Bank in terms of revenue in CIB segment in Europe region, outperformed in profit margin compared to its competitors

2014 changed to IFRS 10,11 accounting practices, lost 6bn Euros as fine to US govt.

A slow down in spending on IT purchases in 2013 increased in 2014 and will have more growth in 2015

Innovations are more in Retail sector to attract customers rather than in CIB

More concerned on reducing cost of risk

In CIB innovations are centered toward analyzing the Clients data in faster way

Bank Overview

45 Countries 15000 Clients 19000

Employee

Europe

Paris, London

Poland, Ukraine

Asia

China

Vietnam

America

North America

Latin America

Middle East

Turkey

South Africa

Retail banking services

Investment solutions

Corporate & Investment

banking

RBS vs CIB

0

5000

10000

15000

20000

25000

2014 2013 2012 2011

23528 2306124572 24361

8722 87019715 9897

Revenue

RBS

CIB

0

1000

2000

3000

4000

5000

6000

7000

2014 2013 2012 2011

Profit Before Tax

RBS

CIB

0

5

10

15

20

25

30

35

40

2014 2013 2012 2011

Profit Margin in %

RBS CIB

Even though RBS having more revenue but profit margin for CIB is more

Business Segmentation

Retail Banking Services: Retail banking networks, Personal finance, International retail banking

Investment Solutions: Wealth Management, Investment Partners covering all business of Asset Management businesses, security services, Insurance

and real estate

Corporate & Investment Banking: Advisory & Capital markets, Corporate Banking business

Strategy

Successfully implement

business development

initiatives

Successfully

Adapt certain

business to their

economic and

regulatory environment

Adapt

Continue improving operating efficiency

Continue

Simply our organization and the way

we work

Simplify

Enhance Client focus

and services

Enhance

Competitive Analysis

*Source: Roland_Berger_State_of_European_Banking_Industry_20140721.pdf

Competitive Analysis:

Credit Suisse:

Divided business into Private Banking & Wealth Management, Investment Banking

Region wise split into: Americas, Switzerland, EMEA, Asia Pacific

UBS:

Divided into Asset Management, Wealth Management, Investment Bank, Corporate center divisions

We are interested in Investment banking and corporate banking. So considering the data for corporate and investment banking alone.

Competitive Analysis

0

2000

4000

6000

8000

10000

12000

14000

BNPPCS

UBS

Revenue

2012

2013

2014

-500

0

500

1000

1500

2000

2500

3000

BNPPCS

UBS

Operating Profit

2012

2013

2014

0

20

40

60

80

100

120

BNPP CS UBS

Cost to income ratio

2012

2013

2014

-5

0

5

10

15

20

25

30

35

BNPP CS UBS

Profit Margin

Competitive Analysis:

We can observe not much increase trend in revenues. I observe the same trend in most of European banks because of European crisis issues. Of

which Credit Suisse having more revenue compared to others.

Operating profit decreased during 2013 but now on increasing trend. BNPP having good operating profits.

BNPP having very low cost/income ratio which is good figure

Profit margin is far better for BNPP, compared to competitors

By viewing all the details we can conclude that it had having good profit margin and good utilization of capital. But it need to capture more market

share.

BNPP: IT Assets

-5

0

5

10

15

20

25

0

500

1000

1500

2000

2500

3000

3500

4000

2011 2012 2013 2014

IT Assets

Purchased Internally Development Purchased Growth Growth Internal developed

We can see there is continuous growth in Internally developed software even

the market fall in 2013

I can infer from the available data, they deferred purchase of IT software in

2013, so there will be lot of IT spends in 2015. Also fintech disruption threat

supports this view.

Innovation: Trends

Innovations targets on Reducing cost, increase relationships with clients,

With innovations banks want to cater the need before they heard from the clients

Know before clients tells : So now focus on the available data about the clients and get it processed with high speed and get the recommendations for the clients

Faster: For a banker it will take a long time to analyze client data and take decisions. Now they trending towards the technology which can put all the data with in minutes

For example: Banks will monitor, inventory details, shipping details, details on social network etc, to come to the conclusion about what product should they offer to the client