BPCE and Generali to create largest European asset manager

BPCE (through Natixis IM) and GIH would each own 50 per cent of the combined business, with balanced governance and control rights.

With over €1.9 trillion ($1.98 billion) of assets under management (AUM), the combination would create a global asset management platform with leading positions and critical scale in both Europe and North America. The combined business would rank No.1 by revenues and No.2 by AUM in Europe, No.9 by AUM globally, and No.1 in insurance asset management by AUM worldwide.

The creation of an asset management leader with strong European roots backed by BPCE and Generali would present a unique opportunity to build and scale a platform that is well-positioned to compete on a global level, generating significant benefits for stakeholders in all its regions. Both BPCE and Generali have longstanding track records of investing in the growth and resilience of the economies in which they operate, contributing significantly through profitable investments executed by the asset management affiliates.

With the two groups sharing a similar approach operating multi-affiliate models that have demonstrated their ability to create value, the combined platform would offer a wide range of competitive strategic solutions to all categories of clients, ranging from Banque Populaire and Caisse d’Epargne’s retail customers to wholesale intermediaries and institutional investors worldwide. The business would offer a complementary range of investment capabilities across both traditional and alternative asset classes, providing an ideal position to address shifting and increasingly sophisticated client needs.

The combined platform would also be better placed to further scale its third-party business in Europe, North America, and regions with attractive growth potential in Asia, building on a global distribution network comprising a strong centralised platform complemented by local presence and multichannel partnerships.

In addition, Cathay Life, a subsidiary of Cathay Financial Holdings, one of the largest Asia-based financial institutions, would remain an important strategic partner.

Generali and BPCE would retain full authority over asset allocation decisions for their respective assets.

As a result, the joint venture would benefit from a significant large pool of long-term insurance capital translating into a key strong competitive advantage for its combined network of affiliates, while offering both BPCE and Generali attractive opportunities to deploy their capital and seed new strategies to unlock new venues of growth, especially in private markets.

In line with its investment approach, Generali would commit to deploying €15 billion ($15.7 billion) in seed and acceleration capital over 5 years across the affiliates forming the joint platform, enhancing the capability to develop new investment strategies and contribute to further expansion of competencies and product offering.

Key financial highlights

The joint venture would result from the contribution of assets and activities valued at approximately €9.5 billion ($9.9 billion) in total. The enlarged business, would manage €1.9 trillion ($1.98 billion) in AUM with a balanced and diversified breakdown illustrated by

• a presence worldwide with core geographies, Europe (61 per cent of AUM) - including a strong footprint in France and Italy, North America (34 per cent of AUM), as well as a footprint in Asia and in other countries (5 per cent of AUM)

• a comprehensive range of strategies across asset classes with fixed income (c.65 per cent of AUM), equities (c.21 per cent of AUM) supplemented by recognised private markets, and other franchises (c.14 per cent of AUM)

The combined entity would serve a diversified client base from both groups and third-parties. Insurers and pension funds would represent more than half of the assets (c.61 per cent of AUM) with the balance split between other institutional and retail / wholesale clients (respectively representing c.14 per cent and c.25 per cent of AUM).

The transaction is expected to create value via synergies as well as growth opportunities and to be accretive to BPCE’s earnings and Generali's adjusted earnings and cash already from year one.

Following completion of the undertaking, the impact on Groupe BPCE’s CET1 ratio would be expected to be neutral and the impact on Generali’s Solvency II ratio would be expected to be broadly neutral. GIH would be deconsolidated from Generali’s accounting perimeter. Generali’s and BPCE’s ownership in the joint venture would be accounted for using the equity method, resulting from the joint control.

Key structure, governance, and employee highlights

The combined business would be co-controlled by the two financial institutions, with each holding a 50 per cent interest, and would operate under a joint governance structure with balanced representation and control.

The entity holding the combined activities would be established in Amsterdam, the Netherlands, while France, Italy and the United States would remain operational hubs of the combined business in charge of the day-to-day operations.

The Board of Directors of the entity would comprise an equal number of representatives from BPCE and Generali supplemented by three independent directors, jointly selected by BPCE and Generali. Upon the creation of the joint venture, BPCE’s CEO, Nicolas Namias, would act as Chairman of the Board, while Generali’s CEO, Philippe Donnet, would act as vice chairman.

Woody Bradford, the current CEO of GIH, would be the CEO of the global entity, and Philippe Setbon, the current CEO of Natixis IM, would be the deputy CEO.

The creation of this global asset management leader would also provide employees with access to a broader and more diverse platform, offering enhanced career opportunities on an international scale.

Philippe Donnet, group CEO of Assicurazioni Generali, said, "The creation of a joint venture with BPCE would present a unique opportunity to establish a European leader and a top 10 global asset manager building on strong roots in Italy, France and the US to serve the constantly evolving needs of our customers, led by Woody Bradford, Philippe Setbon, Nicolas Namias, and me. Our home country, Italy and all other countries in which we serve our customers, would benefit from an even stronger asset management platform with greater investment capabilities that deliver real benefits to the economy."

Nicolas Namias, CEO of BPCE, said, "Today we are thrilled to take a new step towards creating the largest asset manager in Europe and a major global player, alongside Generali, a financial institution that shares our values. With our Vision 2030 plan launched last June, we expressed our ambition to expand in France, Europe, and beyond. It’s very exciting to kick off a project that aligns perfectly with these goals. Building on our recent announcement of the creation of the European leader in equipment leasing and one of the largest European payment processors, this new ambition in asset management illustrates that the dynamic of transformation and acceleration at BPCE is fully underway."

The closing of the potential combination would be subject to customary regulatory approvals and expected by early 2026.

Generali Group sees strong results from first three quarters of 2023 Major Italian insurer Generali Group has released its financial information for the first three quarters of 2023, with highlights including continued growth in both operating and net results, as well as the firm's solid capital position.

Generali – 192 years of global protection, 12 years of companionship with Vietnam On April 24, Italian-backed life insurer Generali Vietnam celebrated its 12-year anniversary with excellent business performance and a nationwide network of more than 100 GenCasa agency offices and branches, serving nearly 500,000 clients across the country.

Generali Vietnam appoints new CEO Italian life insurer Generali Vietnam announced the appointment of Nguyen Phuong Anh as the company’s new CEO on October 16.