French bank reports solid growth and improved profitability across business lines in 2017, while global structured product sales increased by 7.5% with the bank's best-selling structure racking up sales of almost €400m, according to SRP data.

Natixis has reported net income, at €1.7bn, increased by 21% in 2017 and, at €518m, by 5% in the fourth quarter of the year. Corporate and Investment Banking (CIB) showed strong momentum across all activities, with net revenues, at €9.5bn, up 9% in 2017, of which 11% is global markets, according to the bank.

In the fourth quarter, net revenues from global markets were adversely affected by lower client activity in rates and equity derivatives as well as lower volatility in equity derivatives and in foreign exchange, which translated into year-on-year revenue declines of 8% in fixed income, commodities & treasury to €288m and 4% in equity to €144m.

SRP data

Natixis issued 210 retail products across seven jurisdictions and a combined €4.3bn in 2017, a rise in issuance and sales from the 142 products with a sales volume of €4bn in 2016, according to SRP data.

The majority of the bank's structured product sales were achieved in France, where €3.4bn was collected from 105 products. The structures were distributed by 26 different providers of which Equitim, Hedios Vie, i-Kapital, Caisse D'Epargne, Derivatives Capital, Swiss Life Banque Privee, Banque Populaire and Groupama were the most active. Almost all French products (101) were linked to a single equity index including two indices - Euronext Cac Large 60 Ewer Index (64 products) and Euro iStoxx 70 (10) - which are part of the bank's range of market access indices and one index, the Euronext Climate Orientation Priority 50 Ewer (three products) which was the bank's first attempt in the SRI/climate index space. The latter was also used as underlying of Ambition COP Avril 2027, a five-year medium-term note, which is distributed via the Caisse D'Epargne network. With sales of €385m, the product, which is available as a life insurance contract, became the best-selling product in the French market and the second highest seller in Europe in 2017.

In the UK, where the bank is increasingly active, Natixis sold 67 structured products (2016: 28 products), predominately linked to the FTSE 100 and distributed by Meteor Asset Management (45), Mariana Capital (19), Market Securities (two) and Reyker (one), while it sold  eight structured products worth €56m in Belgium. The Belgian products were distributed via Crelan (four), Deutsche Bank (three) and VDK Spaarbank (one) and included two linked to the Euronext BeNe 40 Ewer, another market access index with which the bank aims to bring local solutions to local investors.

Fifteen products were issued in Italy, all bar one linked to baskets of shares. The seven securities sold in Japan had a combined sales volume of JPY30bn (€225m) and were linked to the Nikkei 225, while it was the issuing party behind three products from Exceed and one product from Mangold that were sold in Sweden. The sole Irish product, Wealth Option's Dual Star Performers Note 3, which was linked to an equally-weighted basket of two managed funds, sold €300,000 during subscription and is listed on the Luxembourg Stock Exchange.

Revenues from asset and wealth management were up 22% year-on-year in the fourth quarter of 2017, fuelled by improved margins and higher assets under management, according to the bank. Net revenues from asset management amounted to €857m in the fourth quarter of last year, up 23% on the same period in 2016 and including rises of 37% and 8% in Europe and North America, respectively. Net revenues from wealth management increased 20% on the year.

In insurance, net revenues were up 12% in 2017 and 11% in the last quarter of 2017. AUM in life insurance stood at €54.7bn at the end of December 2017, of which €12.6bn was in unit-linked products. Life insurance net inflows in unit-linked products almost tripled in 2017, at €2.9bn, and accounted for half of total net inflows and 35% of gross inflows for the year, according to the bank.

'Natixis delivered good performances in all business lines in 2017 [...], while successfully completing the New Frontier strategic plan,' said Laurent Mignon, chief executive officer of Natixis, in a statement. 'We strengthened our major lines of expertise around the world, thanks to a strong commercial momentum and a proactive acquisition strategy in asset management, insurance, M&A and payments.'

Click the link to read the full fourth quarter 2017 and full year 2017 results for Natixis.

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