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      Scope affirms A+ Issuer Rating of Banque Fédérative du Crédit Mutuel SA
      TUESDAY, 06/02/2018 - Scope Ratings GmbH
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      Scope affirms A+ Issuer Rating of Banque Fédérative du Crédit Mutuel SA

      Scope Ratings’ action takes account of the likely implications of Credit Mutuel Arkéa leaving the Credit Mutuel Group.

      Scope has affirmed its ratings on Banque Fédérative du Crédit Mutuel SA (BFCM) with a Stable Outlook (issuer rating A+), and simultaneously assigns a new senior unsecured non-preferred debt rating of A. According to the agency, the sustained efforts of Credit Mutuel Arkéa (CMA, not rated) – to leave the Crédit Mutuel Group (CMG) – which is one of France’s three large mutualist banking groups -- may well result in the end in in a split. Nevertheless, should this occur, Scope believes that the remainder of CMG – in which BFCM is the lead entity – would continue as a strong, retail-based banking group with a wide footprint in France and a selective presence elsewhere in Europe.

      Scope referred to the relatively recent announcement by CMA that the boards of two of the three regional bank federations making up CMA have voted to initiate action designed to separate them from the rest of the CMG. The relatively intense level of disagreement between the managements of CMA and BFCM/CMG – against the backdrop of decades-long disagreements – should have, in the rating agency’s view, a separation as the most plausible outcome.

      Nevertheless, citing a reassuring business model and solid financial and prudential fundamentals related to CMG, as well as the group’s proven track record of a well-calibrated and forward-looking strategy, Scope expressed its belief that the group’s fundamentals and outlook will continue to characterise it as a high single-A credit.

      Affirmed were BFCM’s following ratings – all with Stable Outlook:

      Issuer Rating A+
      Preferred senior unsecured debt ratings A+
      Tier 2 securities BBB+
      Short-term ratings S-1+

      Assigned was the following new rating for BFCM, with Stable Outlook:

      Non-preferred senior unsecured debt A

      Stress testing & cash flow analysis
      No stress testing was performed. No cash flow analysis was performed.

      Methodology
      The methodology used for this rating(s) and/or rating outlook(s) Rating Methodology Bank Ratings is available on www.scoperatings.com.
      Historical default rates of Scope Ratings can be viewed in the rating performance report on https://www.scoperatings.com/#governance-and-policies/regulatory-ESMA
      Please also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml. A comprehensive clarification of Scope’s definition of default as well as definitions of rating notations can be found in Scope’s public credit rating methodologies on www.scoperatings.com.
      The rating outlook indicates the most likely direction of the rating if the rating were to change within the next 12 to 18 months.

      Solicitation, key sources and quality of information
      The rating was not requested by the rated entity or its agents. The rated entity and/or its agents did not participate in the rating process. Scope had no access to accounts, management and/or other relevant internal documents for the rated entity or related third party.
      The following substantially material sources of information were used to prepare the credit ratings: public domain, the rated entity and third parties.
      Prior to publication, the rated entity was given the opportunity to review the ratings and/or outlook and the principal grounds on which the credit ratings and/or outlook are based. Following that review, the ratings were not amended before being issued.

      Regulatory disclosures
      This credit ratings and/or rating outlook is issued by Scope Ratings GmbH.
      Lead analyst Jennifer Ray, Executive Director
      Person responsible for approval of the ratings: Sam Theodore, Group Managing Director
      The Issuer Rating/outlooks were first released by Scope on 02.04.2014. The ratings/outlooks were last updated on 21.12.2016. The oreferred senior unsecured debt ratings/outlooks were first released by Scope on 02.04.2014. The ratings/outlooks were last updated on 21.12.2016. The short-term ratings/outlooks were first released by Scope on 22.05.2015. The ratings/outlooks were last updated on 26.10.2017. The Non-preferred senior unsecured debt ratings/outlooks were first released 06.02.2018. The Tier 2 security ratings/outlooks were first released by Scope on 19.12.2016. The ratings/outlooks were last updated on 19.12.2016.

      Potential conflicts
      Please see www.scoperatings.com. for a list of potential conflicts of interest related to the issuance of credit ratings.

      Conditions of use / exclusion of liability
      © 2018 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Analysis GmbH, Scope Investor Services GmbH and Scope Risk Solutions GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5 D-10785 Berlin.
      Scope Ratings GmbH, Lennéstrasse 5, 10785 Berlin, District Court for Berlin (Charlottenburg) HRB 192993 B, Managing Director(s): Dr. Stefan Bund, Torsten Hinrichs.

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