Consolidated results 2021

May 5th, 2022 — Brussels — The Board of Directors of Degroof Petercam has approved the accounts for the year 2021. These will be submitted to the shareholders for approval at the general meeting on 24 May 2022. The meeting will also vote on the appointment of two new non-executive directors, Sylvie Rémond (as independent director) and Tamar Joulia-Paris, and of an executive director, Sabine Caudron.

• Total net client assets at 86.0 billion euros (75.0 billion end 2020)
• Total net revenues at 545.7 million euros (469.2 million in 2020)
• Capital ratio (CET1): 19.7%¹ far exceeding regulatory requirements ​
• Gross operating result at 126.6 million euros (83.0 million in 2020)
• Net profit at 47.6 million euros (40.1 million in 2020)
• Strong performance of portfolios, funds and mandates
• Increase in sustainable assets under management (gross - DPAM) to 19.7 billion euros
• Record growth in (gross) assets under management at the DPAM management entity with 50.7 billion euros

Hugo Lasat, CEO of Degroof Petercam:

"2021 was a good year. We closed the year with total client assets of 86 billion euros, excluding double counting, an increase of 15% compared to 2020. This growth was driven by positive market performance and new capital inflows. Our revenues, at 545.7 million euro, increased by 16%. Revenues grew faster than operating expenses, creating de facto positive operating leverage. In fiscal year 2021, our gross operating income rose by 53% to 126.6 million euros. Beyond the good financial results, I am pleased with the continued growth of our sustainable assets under management. The confidence of our clients, the quality of our employees and the ongoing replacement of our central banking IT platform allow us to look forward to the future of our four core businesses with optimism."

The recent dramatic events with their strong geopolitical repercussions, which saw Russia invade Ukraine, are shaking the whole world, Europe in particular, and the democratic values that animate it. They also affect the financial markets and the risks and liquidity management in the financial sector. Degroof Petercam is closely monitoring the situation and the impact that the current crisis may have on its activities: the management of our clients' portfolios and funds, the liquidity of the portfolios, client interaction and information, and the overall IT and operational environment. Apart from the current lack of visibility and the market variations that are currently impacting the value and performance of securities portfolios, the bank and its subsidiaries, through their main integrated business lines, have very little exposure (if any) to countries in conflict.

1. Proposal to appoint three new directors

• Sabine Caudron proposed to succeed Bruno Colmant as head of private banking

The Board of Directors proposes to the General Meeting of Shareholders of Degroof Petercam on 24 May 2022 to appoint Sabine Caudron as Managing Director. Sabine Caudron would succeed Bruno Colmant who has voluntarily chosen to leave the group he joined 7 years ago as Managing Director.

Sabine Caudron is fluently trilingual and has close to 30 years of experience in the financial sector and more specifically in private banking. She spent 18 years at BNP Paribas Fortis Belgium where she held the position of Director Private Banking Brussels. In 2012, she joined Puilaetco Dewaay Private Bankers as Head of Sales and member of the Executive Committee. Sabine Caudron was responsible for Private Banking Brussels and Private Banking Flanders at Degroof Petercam.

Hugo Lasat:

"On behalf of the Management Committee and all the employees, we would like to thank Bruno for his total commitment over the past years. His achievements within the group are numerous, first as head of the macro-economic research department, and then as CEO and head of private banking. During a period marked by the pandemic Bruno managed the group with foresight and dynamism. Under his leadership, the group has grown stronger and we are grateful to him. He is also a brilliant economist, writer and academician, and we wish him every success in the future challenges he chooses to pursue. However, we will continue our collaboration through his interventions and economic analyses that he will share as a guest at our events."

Bruno Colmant:

"It has been a great honor to contribute to the development of the group over the last few years. As the group enters a new phase of its evolution, I now wish to devote myself to consulting, research and writing activities. I would like to thank the members of the Board of Directors for their confidence and the management team for their extraordinary commitment and collegiality over the past years. I wish Sabine and all the employees of the group all the best and thank the clients again for their loyalty."

Sabine Caudron:

"It is a privilege for me to take responsibility for the Group's private banking activities and to join the Management Committee and the Board of Directors. I am looking forward to continuing to implement the strategy with the existing team and to investing in the development of our private banking activities for the benefit of our clients."

• Proposal to appoint two new non-executive directors

At the same time, the Board of Directors proposes the appointment of Sylvie Rémond and Tamar Joulia-Paris as non-executive directors. ​

A graduate of ESC Rouen, Sylvie Rémond has 36 years of experience in customer relations, financial structuring and risk management within the Société Générale Group. She has been a member of the Executive Committee since 2011 and Group Risk Director since 2018. At the same time, Sylvie has held mandates on the Boards of Directors of French and foreign subsidiaries of the Société Générale Group, in the Risk and Audit Committees, reinforcing her experience in the governance of listed and non-listed companies. As an independent director at Degroof Petercam, she would join the risk committee as chairwoman and the remuneration and audit committees as a member.

With more than 40 years of experience in the financial sector, particularly in portfolio and risk management, Tamar Joulia-Paris spent almost 25 years with ING Group, starting as Head of Credit Risk Management at Banque Bruxelles Lambert, and subsequently holding the positions of Global Head of Credit Portfolio Management, Global Head of Credit Markets and Global Head of Credit Portfolio Group. She is also a professor of financial risk management at the University of Saint Louis (Brussels) and holds several independent directorships, notably at Greenomy and Dexia. At Degroof Petercam, she would join the Risk Committee as a member.

Gilles Samyn:

"The arrival of Sabine Caudron, Sylvie Rémond and Tamar Joulia-Paris on the Board of Directors will be another important milestone for the group. We are delighted to be able to count on their respective skills and experience which, I am convinced, will be additional assets to fuel our strategic vision and accompany our development. I would like to thank Bruno once again for his remarkable work and significant contributions over the past years. I wish him all the best in his future activities."

2. Detail of results

2.1. Total net customer assets: 86 billion euros

Thanks to client confidence and favorable market conditions, Degroof Petercam has reached a record level of total net client assets of 86 billion euros, an increase of 11 billion euros compared to the end of 2020. This growth is mainly due to sustained commercial activity in the asset management and private banking activities and to the market effect.

In line with its strategic refocusing policy, the group sold its Swiss subsidiary at the beginning of April 2022. This follows the sale of its Spanish subsidiary a year earlier. The efforts undertaken over the past two years to simplify the group's organizational structure are continuing today with the operational and administrative transformation of the new management company in France, which was created at the end of last year from the merger between the local banking subsidiary and the former fund management entity.

2.2. Commercial activities: solid performance and positive operating leverage

In 2021, net revenues amounted to EUR 545.7 million, a growth of 16% compared to the end of 2020:

• Private banking recorded operating revenues up 13% over 2020, contributing 44% of total group revenues. This performance was driven by an increase in asset-based revenues, reflecting positive market conditions, higher revenue margins, and an increase in client loans.
• Asset Management passed the 50-billion-euro mark in gross assets under management and achieved operating revenues up 29% on the previous year, contributing 26% of total group revenues. This result was achieved thanks to continued strong net inflows of more than 1 billion euros, improved margins and investor confidence. ​
• Operating revenues in Asset Services increased by 9% year-on-year, contributing 14% of total group revenues. Strong growth in in-house funds and stable third-party funds volumes contributed to this result, offsetting the lower margin, while operating expenses were closely monitored and managed.
• Overall, Investment Banking matched the record level of revenues achieved in the exceptional year of 2020, although a decrease in Global Markets operating revenues was offset by a 32% increase in Corporate Finance revenues, driven by growth in M&A and capital markets mandates. Investment Banking contributed 16% of total group revenues.

2.3. Financial results: a good year

Total net revenues amounted to 545.7 million euro, an increase of 16% explained by the positive performance of the markets, by the improved profitability of private banking and asset management, and by the solid activity of investment banking, through Global Markets and Corporate Finance.

Exceptional items affected profitability, in particular costs related to the implementation of a new core banking IT platform, restructuring in France and the sale of the group's Swiss subsidiary. After taxes and exceptional items, consolidated net profit amounted to 47.6 million euro, an increase of 19% compared with the previous year.

At the balance sheet level, as of December 31, 2021, the consolidated solvency level (CET1 - Common Equity Tier1 ratio) stood at 19.7%¹. The balance sheet total is 10.0 billion euros, including more than 5.3 billion euros in highly liquid assets, illustrating the group's financial strength following a conservative policy in the management of its balance sheet and its activities.

¹ The CET1 ratio as of 12/31/2021 takes into account the immediate incorporation of the dividend distribution in 2022. On the other hand, the result of the financial year 2021 will only be incorporated into the ratio on June 30, 2022, after its expected approval by the General Meeting. ​ If both components could have been taken into account simultaneously, as of December 31, 2021, the ratio would have been 21.4%.