Rating action

Scope Ratings GmbH (Scope) has today affirmed the issuer rating of A+ on Crédit Foncier de France (CFF) and Compagnie de Financement Foncier (CieFF). The outlooks are stable.

Rating rationale

The ratings of CFF and its wholly owned subsidiary CieFF reflect the credit quality of CFF’s parent, BPCE S.A., the central body of Groupe BPCE. CFF and CieFF have the status of affiliates within Groupe BPCE and therefore benefit from the intra-group solidarity mechanism under French law.

The A+ issuer ratings on CFF and CieFF reflect the following credit considerations:

• CFF and CieFF benefit from the strong internal solidarity system within Groupe BPCE. It underpins Scope’s expectation of full parental group support. Any change in the credit quality of BPCE S.A. entails a similar rating impact for CFF and CieFF.
   
• The strategic relevance of CFF within Groupe BPCE stems primarily from its refinancing role as active issuer of covered bonds for the benefit of the group’s funding diversification. Following a strategic review, ancillary activities previously performed by CFF were put in run-off. As a result, CFF and CieFF’s balance sheets continue to converge.
   
• Risk management is fully aligned with Groupe BPCE’s framework, allowing creditors of CFF and CieFF to benefit from the group’s strong risk control culture.

Outlook and rating-change drivers

The Outlook is Stable, reflecting Scope’s view that CFF will retain its strategic importance for the group’s funding strategy and its access to the intra-group solidarity mechanisms and therefore benefit from full support from the parent in case of need.

Scope would downgrade the rating in case of:

• A weakening of CFF’s and CieFF’s strategic importance
   
• A downgrade of BPCE S.A.’s issuer rating

Scope would upgrade the rating in case of:

• An upgrade of BPCE S.A.’s issuer rating

Overview of CFF’s rating construct

Operating environment: not applicable

Business model: not applicable

Initial mapping refinement: not applicable

Initial mapping: not applicable

Long-term sustainability: not applicable

Adjusted anchor: not applicable

Earnings capacity and risk exposures: not applicable

Financial viability management: not applicable

Additional rating factors: not applicable

Standalone assessment: not applicable

External support: ratings aligned with the parent, full support

Issuer rating: A+

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

Methodology
The methodology used for these Credit Ratings and Outlooks, (Financial Institutions Rating Methodology, 7 February 2023), is available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at https://scoperatings.com/governance-and-policies/regulatory/eu-regulation. 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 Ratings’ definitions of default and Credit Rating notations can be found at https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
The Outlook indicates the most likely direction of the Credit Ratings if the Credit Ratings were to change within the next 12 to 18 months.

Solicitation, key sources and quality of information
The Rated Entity participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain, the Rated Entity, and Scope Ratings’ internal sources.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and Outlooks and the principal grounds on which the Credit Ratings and Outlooks are based. Following that review, the Credit Ratings were not amended before being issued.

Regulatory disclosures
These Credit Ratings and Outlooks are issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings and Outlooks are UK-endorsed.
Lead analyst: Nicolas Hardy, Executive Director
Person responsible for approval of the Credit Ratings: Marco Troiano, Managing Director
The Credit Ratings/Outlooks were first released by Scope Ratings on 7 February 2017. The Credit Ratings/Outlooks were last updated on 24 September 2021. 

Potential conflicts
See www.scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings.

Conditions of use / exclusion of liability
© 2023 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Fund Analysis GmbH, Scope Investor Services GmbH, and Scope ESG Analysis 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.