Good morning everyone and welcome to Paris and the presentation of our Q3 and nine- month results for 2024. I'm joined by our two hosts, Deputy CEO Nicolas Calcoen and CFO Aurélia Lecourtier. In a moment they will present the highlights and the results for Q3 results. But before we do this, unfortunately we'll have to do a bit of housekeeping first. First, as you will notice in the documents, we have a disclaimer, so please read it. I won't go through it as now, but obviously it's there. And as regards logistics, this is a video call, so please open your camera and you will be able to ask questions. After the introduction and the presentation by Nicolas and Aurélia, please raise your hand. I see that some of you already did.
We will open your mic and then you will be able to ask your questions and do any follow up that you wish. But without further ado, Nicolas, the floor is yours.
Thank you very much, Cyril, and good morning to all. It's a pleasure to see you today. Thank you for joining us as we present our third quarter, nine months, 2024 results. As usual, I will briefly comment on some of the highlights of the quarter and then leave the floor to Aurélia who will detail our activity and results before we take your questions. So, this last quarter allowed us once again to demonstrate Amundi's healthy growth potential. First, financial growth with a strong increase in both our revenues and results, reporting in particular a nine months net income of over EUR 1 billion for the first time.
Second, this is also reflected in the growth momentum of our inflows which are again well diversified in terms of client segment, in terms of expertise, in terms of geography and third, strategic development, in particular in ETFs, third party distribution, Asia or technological services, in line with the priority we define in our medium term plan. So let's start first with our assets under management. They reach EUR 2.2 trillion, an all-time high and they are up by 11% over one year. While there's obviously a significant market effect, this figure also reflects more than EUR 55 billion of net inflows on 12 months. In terms of financial results now, our net profit in the third quarter was up 16% versus the third quarter of last year and they reached EUR 337 million.
This strong growth originated from the very top line of the P&L, the revenues, which also grew by double digits, and it was as always at Amundi, amplified by our trademark or operating efficiency. This positive jaws effect resulted in an improved cost-income ratio to 52.9% in line with our strategic target for 2025, and of course we also saw the positive effect of our fast-growing JVs on our net income. Regarding our business activity, as I said, our clients have entrusted us with an additional EUR 55 billion to manage in the past 12 months and EUR 35 billion since the beginning of the year. This demonstrates our capacity to innovate and to adapt our product offering to their needs and their approach to risk inflows.
Inflows were also positive for the third quarter with EUR 14 billion excluding the exit of a low- income insurance mandate that we, you remember, had announced in the third quarter. What is particularly encouraging is that these inflows continue to be driven by our strategic priorities. I will look more closely in a minute to our performance in ETF in fixed income and turning technology and services in this next slide. But first I wanted to focus on two areas of strategic growth here that we already developed in the second quarter. First, third party distribution clients. We saw EUR 7 billion of net inflows again with these clients and these inflows came from all the regions that we cover, where we are present and across all asset classes.
We also continue to see strong inflows in Asia driven by the success of our Indian JVs with SBI, but also by, and very significantly as well by our direct presence in Japan, in Singapore, in Hong Kong and also in China through our institutional business. And finally, as you know, we have been very active this year in M&A. Alpha Associates was integrated in the second quarter as you remember, and our partnership with the U.S. manager Victory Capital is on track for closing towards the end of first quarter of 2025 with a process of regulatory approvals, gathering of client consent, progressing well. Before I hand over to Aurélia, I just want to talk briefly about three growth drivers. First, ETFs first, Fixed Income, which is a business line. We presented our dedicated workshop last year on Technology and Services. So first ETF.
As you can see, our ETF franchise exceeded EUR 250 billion in assets under management at the end of September. Net inflow averaged EUR 17 billion since the beginning of the year and with EUR 8 billion in the third quarter alone, we were the second largest asset gatherer in the European ETF market this quarter. Inflows are very well diversified across equity and fixed income products with also a strong focus on responsible investments which represented more than one third of our inflows during this quarter. We continue also to expand our range to offer investors, both institutional and retail, a highly diversified and competitive toolbox. This includes for example, products like the Amundi ETF STOXX Europe 600 which was the best-selling European Equity ETF during this quarter.
Now, Fixed Income. We also continue to develop our Fixed Income platform where we are clearly the European leader. With close to EUR 1.2 trillion in assets, this platform has clearly the size, the teams, the tools and the innovation capability to meet our client needs. These solutions gathered overall EUR 14 billion of inflows in the third quarter and EUR 46 billion in the nine months across both active and passive management. Mainly active and bond strategies, including in particular target maturity funds were particularly successful. They benefit from client appetite for investment solutions that offer both attractive returns and security. One last element I wanted to point out, Technology and Services. Here as well, we are experiencing strong growth. Technology revenues were up by 42% compared to the third quarter of last year and 28% for the nine months of 2024.
We have accelerated our investment and we continue to expand our client base which is progressively increasingly diversified across banks, pension fund insurers and asset managers. It's also increasingly diversified by geography and particularly we recently announced our first client in the United Kingdom for our Alto technology platform, Thomas Miller Investment, a U.K. asset manager. Finally, on the service side, our Fund Channel fund distribution platform has exceeded EUR 490 billion at the end of September, which is a new milestone on the path to our 2025 target of EUR 600 billion. In particular, during this last quarter we signed a new large distribution contract with ING in Germany. So I now leave the floor to Aurélia who will go into more details about this growth.
Thank you, Nicolas, and good morning, everyone. First, I will give a quick overview of our market conditions to set the context of the quarter. As you can see, the overall market effect versus Q3 last year on our net management fees was positive thanks to both an equity rally and supportive bond markets. However, when compared to 2021, the reference year of our medium-term plan, the effect is almost neutral with positive impact of equity markets offset by higher rates. Moving to the next slide, the market for open-ended funds and ETFs in Europe continued to recover with inflows of EUR 213 billion for the quarter. But European investors remain risk averse with net flows that are still far from the level of 2021. Inflows still driven by passive and treasury products and active inflows that remain modest and mostly driven by fixed income.
Moving to the next slide, we see that Amundi performed well in this context. Our assets under management reached an all-time high of EUR 2.2 trillion at the end of Q3, an increase of 2% over the quarter and 11% over one year. On a 12-month basis the market effect totaled almost EUR 176 billion while over the same period we gathered positive flows totaling EUR 55 billion despite European market headwinds. Moving to the next slide, we can see now our Q3 inflows. So in Q2 we announced the exit from a large low income European insurance multi-asset mandate which represented EUR 12 billion to be recorded this quarter.
So adjusting for this exit, Q3 net inflows reached more than EUR 14 billion of which EUR 9 billion in MLT assets, EUR 5 billion from our JVs when Treasury products were flat. MLT flows were positive across all areas of expertise, passive, active, structured product and real assets, all client segments and all major markets, France, Italy, Germany, Asia and the U.S. Bonds were the most successful expertise in active with EUR 11 billion inflows. As in previous quarters. Moving to the next slide, the activity was underpinned by our investment management performance. As you can see more than 70% of our open-ended fund AUM were in the first and second quartile. 257 of Amundi funds are rated four or five stars following Morningstar and 81% outperformed their benchmark over 5 years.
These KPIs have been consistently strong quarter on quarter, and it shows that we strive to maintain high levels of performance to earn our clients' trust. We can now move to our client segment starting with retail on this slide. You see in Q3 we posted net inflows of more than EUR 6 billion. This was the result of various trends. First, a strong performance in third-party distribution as highlighted by Nicolas with close to EUR 5 billion in net inflows driven mostly by ETFs and treasury products. Partnered networks activity was flat. Overall French network continued to see risk aversion due to competition from other savings products and from a renewed interest for Euro contracts. Treasury products recorded inflows in our French networks.
When we look at our other networks in Italy, the market still suffers from competition from sovereign bonds and outflows in multi asset were partially offset by structured products in both UniCredit and Crédit Agricole Italy's networks. Sabadell in Spain continues to stand out with net inflows of EUR 0.4 billion on the quarter thanks to the success of our structured and treasury product as well as of our target maturity funds. Moving now to Institutional segments. MLT assets, excluding the insurance mandate I was mentioning earlier, posted net inflows close to EUR 8 billion. They were positive across all subsegments with EUR 4 billion in Institutional and sovereign, EUR 2 billion from insurance mandate thanks to the continued recovery of Euro contracts in France I was mentioning, EUR 1 billion in corporate and employee savings thanks to the success of our short-term bond strategies for corporate clients.
Treasury products posted net outflows of EUR 5 billion due mainly to seasonal withdrawal from a large institution which already partially came back in October, and finally on the next slide we can see our Asian joint venture that collected EUR 5 billion on the quarter with flows driven mainly by SBI MF in India that collected more than EUR 6 billion mostly in MLT assets. Looking at China, ABC-CA, like our majority JV with BOC, posted outflows and concerning ABC-CA mostly due to the Chinese business. It has to be noted that the JV recorded positive flows in open-ended mutual fund. Let's move now to our financial result for the quarter, starting with revenues. As you can see, revenues reach EUR 862 million this quarter, up by more than 10% compared to Q3 last year and driven by high level of activity and favorable markets.
Net management fees were up by 9% year- on- year in line with the increase of our average AUM performance. Fees almost doubled year- on- year at EUR 20 million and were down compared to Q2 due to expected seasonal effects. Technology revenues grew by 42% year- on- year. Moving now to the Costs side. So this revenue growth was, as Nicolas said, complemented by a good operating efficiency resulting in a positive jaws effect with costs increasing by 7% and revenues growing by 10%. In Q3, our costs were mainly driven by three major elements. First, the consolidation of Alpha Associates since Q2.
Second, the increase in bonuses related to the growth of our revenues and our operating profits and third, the accelerated investment in our strategic priorities, namely additional resources to develop Alto to increase Amundi Technology revenues and further expansion of our Asian commercial footprint. Our cost income ratio at 52.9% is in line with our 2025 target and stays at the best level of industry. This leads us to our adjusted net income for Q3. The adjusted net income is as you can see, up by more than 16% year- on- year at EUR 337 million. Our gross operating profit increased for close to 14% thanks to healthy revenues and performance fees and growth is also underpinned by the contribution of our JVs, up by 37% year on year and representing now close to 10% of our adjusted net income.
Adjusted earnings per share was EUR 1.65, up 16% as well. Now we can have a look at our nine-month results. On a year-to-date basis, adjusted net income grew double-digit by 10% year- on- year. Moreover, it is the first time that our adjusted net income passes the 1 billion mark in the second quarter of the year. The trends are the same as for Q3: healthy growth, healthy revenue growth, positive jaws effect, further income-to-cost ratio improvement, and strong contribution from our JVs. Adjusted earnings per share in nine months was EUR 4.91, up 10% like our net income. Before I hand over to Nicolas, we wanted to highlight two topics. First, the annual Amundi employee capital increase, which was once again a success this year, showing a strong commitment from our staff.
Indeed, more than 2,000 employees at Amundi have subscribed in more than 15 countries. The total amount raised is EUR 36 million and we will book a charge of EUR 12 million before tax in our Q4 to reflect the discounted issue price of the shares. New shares created represent less than 0.4% of our capital. So the dilution effect of this operation on EPS will be very limited. Second, as you may know, the French government has submitted to Parliament as part of the 2025 Finance Bill, an exceptional tax contribution on the profits of large companies in France for 2024 and 2025.
Amundi is among the upper category of turnover for fiscal purposes and will therefore be affected based on the annualized nine-month results and if the bill is adopted, obviously we would expect an additional tax charge of between EUR 60 million and EUR 70 million for the fiscal year 2024 that will be fully accounted in our fourth quarter this year. Based on the same net profit amount, the impact for 2025, the second year of the exceptional contribution would be between EUR 40 million and EUR 50 million. To conclude, let me just maybe quickly come back on the results of the day. The key takeaway from the quarter and the nine months is growth.
Growth coming from a very healthy top line, amplified by our operating efficiency and also growth coming from our JVS that have increased by half over the past two years, showing strong evidence of the successful development of our partnerships, namely in Asia. And I hand over to you Nicolas for a few concluding remarks before we take your questions.
Thank you. Thank you very much. Aurélia, just a quick words to I would say reinforce again our key messages for this quarter. First, as you can see, Amundi enjoys once again high level of business activity and profitability with AUM at record level. Very strong growth in net income, improved cost income ratio. Second, we made further progress towards our 2025 strategic ambitions with a very strong growth in ETF, in third -party distribution in Asia, in Technology and Services. Third, probably most importantly, by always putting clients at the heart of our strategy and by continuing to develop the areas of expertise that primarily seek to meet their needs, we are ideally positioned to seize growth opportunities in the saving industries. So now we are at your disposal to answer any questions you might have.
Thank you, Nicolas. Thank you, Aurélia. So, as Nicolas said, we are now ready for questions. We will start by Arnaud, who was, I think, first to raise his hand. Arnaud, you can reactivate your mic, I think. Yeah.
Yeah. Good morning. Can I ask three questions, please? First, if you could start with the ETF flows. They seem to be concentrated in some of the core products. We estimate that it's roughly about half of the management fee versus your book, the average book management fee. Is that something you could confirm for us? My second question is your partnership networks, particularly in Italy. I was wondering if you could confirm whether or not there are any penalty fees included in the revenues paid from some of your partners because they're not fulfilling the share of AUM flows that they're obliged to give as per the contract, if that's something you can confirm or not. My third question is on Alpha Associates and private markets in general.
Could you talk a bit more about any product launches that might be coming up, anything you might be excited about, any momentum there? And in that light, given the activity we're seeing more broadly amongst your larger, the very large traditional asset managers seeking to acquire more into the private market spaces, is that something that you could consider, as, I suppose, as a priority, beefing up through M&A, your presence in private markets? Thanks.
Thank you. Arnaud, I'm not sure I understand your first question on ETF. I understand perfectly the two others, but the first one, I'm not sure we got it.
You said, well, I think STOXX 600 is amongst your highest inflows, and that's roughly a 10 basis point margin versus your back book of 20 basis points. I'm just wondering if I zoom out and I look at all the flows that you.
Okay. So I understand the first question of the margin on the ETF business. It's slightly above 10 basis points, of course, from one product to another, whether we're talking about something very vanilla or something more niche, the difference can be significant. But let's say it's a bit more than 10 basis points. The second question was about partnerships in Italy and potential penalty. Nothing significant in the numbers we are talking about, no penalties. And regarding private assets and in particular Alpha, it's obviously a very important area of development. And as you know, the acquisition of Alpha a few months ago was a significant reinforcement in that regard. We have been working over the last months very strongly to ensure that you have a good connection between the Alpha teams and our sales and marketing teams.
Designing, adapting, educating our sales force, adapting the marketing materials, thinking about new ideas and new development. Indeed. So for the moment we. It didn't materialize in new inflows yet, but I'm sure it will come very, very soon in the quarters to come. And yes, it does include innovation. They are launching regularly new products and maybe one important aspect to point out, something we have been working with our existing, I would say Amundi teams and Alpha teams is to design retail product leveraging on our global capabilities in multi management across I would say the spectrum of private assets. And we're also taking advantage of the new opportunities coming in particular in France from the Loi Industrie Verte , Green Industry Law, if I may translate that require for retirement product or for some portfolio management product to include a minimum proportion of private assets.
We have been working to leverage on this new opportunity. I would say to be in a position and we are in a position to propose both in retirement products, especially in savings products in France and in DPM portfolios, a similar proportion of assets in private assets, our products that have been just recently approved by the authorities in both the French AMF and the CSSF in Luxembourg.
Thank you, Arnaud.
Thank you very much.
Thank you. The next question will come from Hubert, Hubert Lam from Bank of America. Hubert?
Hi. Thanks for taking my questions. I got three of them. Firstly, on your third-party inflows of EUR 6.8 billion, can you give us the split between active and passive or is it just mainly on passive in that number? That's the first question. The second question is on can you discuss the implications of UniCredit distribution if they, if UniCredit ends up buying Commerzbank, would this be positive as it expands the distribution to the Commerzbank network if it's done or does the agreement not extend to acquisitions? Just a little bit clarity around that. And lastly, with rates coming down, are you expecting a shift from treasury assets and savings to more passive and active funds by retail investors? I know you don't see it yet in the Q3 numbers, but when do you think this could happen?
Like, what's the typical time lag or at what level interest rates could we start to see a switch from savings to do more actively managed products or managed products? Thank you.
Thank you. I will take your question on UniCredit and Commerzbank and your last question and maybe Aurélia on third- party distribution. So on a potential bid on UniCredit and Commerzbank obviously not comment on that but what I can say is that it has no impact on our distribution contract. They are designed to be protected. At the same time there's no automatic expansion to potential new networks to be acquired by UniCredit, so I would say it's neutral. And regarding flows and potential move to more riskier products, that's what I think was your question. Indeed we don't see for the moment, as I can see in the third quarter it was not really visible except really for third party distribution where already we have more flows and more flows in particular in active management.
But yes, as the trend of the decrease in short-term interest rates is moving and probably at a faster pace than what we could have anticipated a few months ago, we are expecting to see progressively a return of appetite of retail clients to riskier products: to equity and multi-asset products, where until recently it has been very much on treasury and fixed income.
About your question on the third party and the flows. We have EUR +6 billion on the quarter. Inside you have 4.5 billion in MLT. So mostly driven by passive as you said, passive is about half of the inflows of the total inflows. But not only we see some positive flows in active for EUR 0.9 billion this quarter and also a bit of positive flows in structured product EUR 0.6 billion in the third- party segments. So quite diversified and positive in many areas of expertise for the third party distribution network.
Great, thank you.
Oh, sorry. The next question comes from the line of Bruce. Bruce, you can open your mic. Bruce Hamilton from Morgan Stanley.
Hi there. Morning. Thanks for taking my questions. Just on the flows into kind of retail. Obviously money markets dominated at about EUR 5 billion across French international networks and third party. Can you give us some indication? I assume that's going to be quite margin dilutive versus the 35-40 basis points that you're generally charging in retail. But it'd be helpful to know is that well below the say 10 basis points you were getting through that new ETF contract, for example. Secondly, just to understand, I guess your investment funds looks pretty good and yet your flow experience in retail looks worse than the industry. So I'm just trying to understand that is it largely a function of geographical and distribution so UniCredit not really selling your products. France being very subdued versus the rest of Europe.
I'm just trying to understand why you're having a worse experience in active than the rest of the industry. And then finally just an ask Cyril and Tom. I do a great job in being very transparent about the mix of retail flows when we speak to them. But in your disclosure it would be helpful to highlight within retail what is treasury and what is not treasury because obviously the headline number of six whatever billion looks a good deal better than the reality in terms of the sort of active or long term flows in my opinion. Thank you.
I understand the first and the third question are a bit connected. Money market funds in retail have lower margins and purely active product. But the difference is probably not what you have in mind. Treasury products in retail typically have higher margins than when they are sold to institutional clients, corporate clients that have access to shares that have lower fees, institutional shares where people need to invest very significant amounts but the fees are lower. And so to illustrate, we are talking about fees in retail that are around or above 20 basis points. So it's not. It's slightly dilutive. Not that dilutive. That's why to connect, to make the connection with your third question, we consider that. And we have no problem .
To give more details but making this especially in this space making this distinction between long- term assets on treasury is not totally relevant new market context and new interest market context that we are seeing for the last two years. Your second question on sales performance in Retail compared to the industry. I'm not sure it's really worth with more than EUR 6 billion inflows on a single quarter. I think it's a good one but obviously from one geography to another it's different and indeed I would say the fact that we are more exposed in terms of stock to markets such as Italy in particular where there's always competition from BTPs or to some extent France as a consequence.
But at the same time as you can see we are developing and growing very fast in other markets in the rest of Europe and in particular in Asia. So we are really I'm convinced compensating this by our development in new areas and new geographies of development.
And maybe to complement on the treasury product inside the Retail segment. If Thomas and Cyril did the job, it's fine. Just to remind everyone the figures EUR 6.3 billion inflows on the Retail side and inside this we have EUR 5 billion of treasury. French, in French networks, actually the flows were mainly driven by treasury this quarter and in third party, as I mentioned before, it's part of but not only, it's less than half of the inflows coming from money markets and it's rather flattish for the international networks. So all in all, except for France, flows especially in third party are also driven by active, passive and overall MLT assets, not only money markets.
To just give a slight comment on the French networks, we are talking about the third quarter where the launch of new structured products is generally a bit lower. A lot of money I would say waiting for a new launch is parked. I don't know if the right expression in treasury products.
Thank you. The next question comes from Deutsche Bank. Sharath, you can open your mic I think.
Thank you, Cyril. I have three questions, please. First is on M&A. Just wanted to understand your willingness to do a larger deal than the bolt-ons that you have been associated with in recent. I ask this in the context of your excess capital as well as a recent news flow of one of the larger insurance companies possibly putting the third-party asset management business for sale. Of course, I do not expect an answer on this deal specifically, but generally wanted to understand your stance or willingness to do a bigger deal outside of what is possible through your excess capital. That is the first one. Second one is on India. Very encouraging to see performance there. Wanted to understand the sustainability of the flow picture and maybe your confidence to maintain your market share around the 18% levels.
A good gap versus the second player there. That's the second one and the third one is on China. Was a bit surprised to see net outflows in ABC China in 3Q despite an improving market backdrop. Maybe if you could explain reasons behind this and maybe outlook and also clarification on the channel business. So when do you see outflows completely coming to an end? Thank you.
Thank you. On M&A our approach has not changed. We consider that we should and we are contemplating any opportunities that help us to accelerate our growth and as long as it's in line with our strategic priorities and as long as it help us to reinforce our footprint both in terms of expertise. It was the example of Alpha Associates very recently or Lyxor 3 years ago for ETF or in term of geographies with strong focus on international diversification and of course as long as efforts to accelerate or our strategy and as long as from a financial point of view it meets also our criteria. So it means that we can consider, as we have done recently, bolt-on acquisition but we also can consider larger deal as we also have done in the past few years ago.
So if there are opportunities of that type, we will contemplate them. Of course, our excess capital of EUR 1 billion clearly allow us to finance 100% through this excess capital bolt-on acquisition for bigger deal we would have if there is an opportunity to look at other structures. But being a listed company, as again illustrated by the acquisition of Pioneer a few years ago, we would be in a position to contemplate larger deals. Regarding India, the question related to concerns about maintaining our market share. Yes, definitely. Hopefully to continue to increase the market share as the JV has been doing in the past because all the ingredients for it to be successful are there.
Of course the market has a very strong potential, but the JV through a very strong and good relationship between the two shareholders, very strong teams, a very large set of expertise across all management styles. We are confident that and very very efficient distribution capabilities through of course the networks of SBI, through other partnership with our distributors and more and more directly, including online. There's a very strong capacity to develop and to continue again to maintain or even to capture market share. Last question was about outflows in China and with ABC. To be noted that on mutual funds we had positive inflows. So it's more in the institutional space that we had some. The JV had some outflows during this quarter in a market context which I would not qualify as really positive.
There's a lot of uncertainty and the last quarter there was still a lot of uncertainties. There was a stronger aversion from clients. So I wouldn't honestly qualify as a context as a favorable one over the last month. And regarding the Channel business, maybe you.
Have.
The number.
Nicolas, yes, we suffered from outflows on the Channel business. The outflows were really low in Q1 and Q2, a bit more for Q3, EUR 0.9 billion outflows in Q3. In Q3 we still have EUR 3.8 billion of Channel business in the JV that should come out from now on until 2027. This is to have in mind, to keep in mind, and just one figure to complement what has been said on our activity in China. Maybe a figure for ABC-CA, still we collected year- to- date EUR 5 billion on mutual fund in this JV showing that the activity is depending on the quarter but is somehow positive when coming.
To mutual funds.
And Channel business, to remind, it's for regulatory reasons that it's an extension and it has very, very, very low margin. So no significant impact on the P&L.
Thank you, Sharath.
Next question from Angeliki from JP Morgan. Angeliki, you can open your mic.
Good morning and thank you for taking my questions and four questions from my side as well please. So first of all on the French Retail network flows, thank you for the color on the treasury products there. It looks like the underlying sort of medium to long term is a negative number, is an outflow number. And if I also look at sort of the multi- asset excluding the institutional mandate redemption, multi- asset outflows were quite strong at EUR 4.1 billion. So I was wondering where those French Retail sort of outflows excluding money market driven by multi- asset and can you give us some color with regards to sort of the behavior behind those weak flows in France? Were they because of the French elections and uncertainty around sort of taxes and the budget or something else?
Second question with regards to Italy and the Italian networks, given that you said Sabadell has had inflows. I mean I can only assume that the UniCredit network has been in outflow this quarter again and we have seen outflows for the past few quarters. Are there any signs of improvement there as we move into 2025? And are the Italian retail outflows driven by risk aversion or is there anything specific there with regards to the UniCredit relationship that will be difficult to repair? Then third question on management fee rate on a blended basis we estimated at 17.7 basis points which is the same level as the previous quarter. There doesn't seem to be any impact from sort of lower margin inflows this quarter. Can I please check that there are no one-offs within the management fees this quarter or anything else that could inflate the margin?
Last question on the French tax surcharge, can I check what is your basic assumption there? Do you assume that it will fall out after the next couple of years or is there a risk that it actually becomes permanent? Thank you.
Thank you. On French retail networks, as Aurélia explained, on this quarter we had very strong flows in money market funds and some outflows on long-term assets. Yes, there are still some outflows in multi-asset products still. Even if it's slowing down in real estate, over the previous quarter it was compensated by a structured product. As I said, in the third quarter there was a more limited number of launches of structured products. Regarding Italy, yes, there are some outflows as you can see on market data. It's not specific to our partner networks. I think it's something you see across the board in the retail Italian market. So nothing specific to our retail partners and it's in the context of risk aversion and competition from BTPs in particular. So in this quarter, not yet a sign of a recovery.
We'll see, we'll see in the future. Regarding management fees margin, there's no one-off, absolutely no one-off on the third quarter. So margins are globally stable as always. Our margin, the average blended margin is a consequence of the pace of evolution of our various businesses in terms of expertise but also in terms of clientele. You can see that we had good flows in Retail where on the contrary we lose this EUR 11.6 billion mandate, insurance mandate, which had a low margin. And the last question on the tax surcharge, the projected bill is based on exceptional contribution only for 2024 and 2025. That's the only thing I can say at this stage.
Thank you.
Thank you, Angeliki. Next question is coming from Mike from UBS.
Thank you for letting me ask some questions here.
Just two please.
First, on financial income we saw a decline from the run rate in recent quarters as well as year on year. I was just wondering what was happening there. I know you include NII in there but you know rates seem to remain relatively elevated throughout the quarter. So I was just wondering about the decline. And then second, just a quick question. In the presentation you highlight within Alto winning a U.K. mandate Thomas Miller. And then I think that was on page five. On page 16 you talked about one new international client being signed in Q3 which is based in Norway. So I was just wondering if Thomas Miller was signed previously or how that works. Thank you.
Maybe a quick answer. On financial income, the evolution are based. First, we start to see the impact of rates coming down. And second, also impact of the dividend. That explains the slight decrease from between Q2 and Q3 as coming to financial income.
Regarding Alto, yes, Thomas Miller is obviously not in Norway. I think it was one in Q2 but at that time we were not in a position to disclose the name, so there are two different clients.
Okay. We have another question from Oliver from Goldman Sachs.
Oliver?
Hey, good morning. You hear me okay?
Yes, we can.
Great, thanks for the update on taxes. You've given the euro impact of taxes this year and next year so EUR 60 million-EUR 70 million and then EUR 40 million-EUR 50 million. But can you give it in terms of a group-level underlying tax rate just so the market can calibrate as the proposals shift. Again, here, the spread of consensus is very wide for 2025 and 2026. And then the second question. You know, thanks for the update on the 2025 targets in the release and your comments today on M&A. Back at the 2022 Investor Day, you talked about a cumulative excess capital build of around EUR 2 billion out to 2025, with the commitment that it would either be returned to shareholders via exceptional distribution or use for inorganic opportunities. 2025 is obviously just around the corner.
Your AGM is in May, so should we be expecting an update on this at some point, or should we just roll this inorganic flexibility commitment into perpetuity? Thank you.
I'm not sure we got the question on tax. I don't know. If you can repeat the question?
Oliver?
Oliver?
Are you still here? Oh, sorry.
Sorry.
I was muted. Yeah. So you've given it in euro million terms. I guess what, what, what is the shift in group blended tax rate you're assuming to bridge that EUR 60 million-EUR 70 million in 2024 and EUR 40 million-EUR 50 million next year would be very, very helpful. Thank you.
The difference, the fact that if I understand well, next year the exceptional contribution will be half in terms of percentage of what it is today, but it's not half of the cost because you have to take into account the impact of deferred tax assets where there is a positive impact this year and a negative impact next year. That's why you make sure the charge is not half of the charge for this year, but a bit more.
So what should we be modeling in terms of underlying tax rate for next year?
Oliver, I suggest that we take it offline because it will require some calculation. So I propose that we have a chat later today.
Sure, sounds good. Thank you.
Obviously, any other analysts interested in the results can send me an email, and I will also provide you with the information.
And the second question, sorry, was about excess capital. Indeed, at our Investor Day in 2022, we talked about potentially EUR 2 billion at the end of 2025, with the assumption that would be available for M&A or for return to be returned to investors, in addition to the, I would say the regular dividend policy, which is 65%. So we are several operations. We are not yet at the end of 2025. So it's at that time that we'll make the assessment. But in the meantime, you can already observe that. We have already started to use part of this excess capital, in particular with the acquisition of Alpha Associates a few months ago. And we also, over the last two or three years distributed more than 65% of annual net income. So two elements that indicate that there will not be.
But again, there's still a bit more than one year to come with potential other opportunities. There will not be EUR 2 billion at the end of 2025, very logically and consistently with our announcement during the 2022 Investor Day.
Okay. Thank you, Oliver. The next question comes from Nick from Citigroup.
Yes, good morning. Thanks for taking my questions. T hree from me if that's okay, please. Just curious, how are you thinking about the implications of the BNP- AXA deal and how it might impact your competitive positioning within France? And I guess as part of that, are you open to large- scale M&A in Europe or are you still more focused on M&A in well, typical high growth areas, be it private markets or Asia or what have you? That's the first one. Secondly, we have seen several partnerships recently between public asset managers in public markets and private markets managers. I guess most recently the most would be Partners Group and BlackRock.
I know you have private markets capabilities, but equally given direct private markets investing is not a major part of your book, would you be open to do anything similar? And then the final question is, I saw you had net outflows from your BOC JV. Can I just ask about the trends in China within the quarter and I guess particularly interested since the stimulus that we saw at the end of Q3 and beginning the impact there of client demand at the end of Q3 and what we've seen in Q4 to date and how you're feeling about the outlook for that business in light of those market developments? Thank you.
Thank you. So first question, obviously I won't comment on the BNP- AXA deal. What I can say is that indeed it's kind of an illustration of movement of consolidation in asset management. A movement of consolidation to which we already participated very significantly over the past, as you know well and quite successfully. And we will continue if there are opportunities, if there are opportunities that meet our criteria, which are in particular acceleration of growth both in terms of expertise and also in terms of geographies. So it can be in Europe, it can be elsewhere. It's a question of being very analytical in seeing the value that a deal can bring to Amundi. But definitely we are looking at potential opportunities and we are clearly well positioned in a market that could consolidate.
Your second question is related to partnerships between, I would say, traditional asset managers and private players. As you pointed out, we have internal capabilities and we are reinforcing them in particular, but not only with the acquisition of Alpha Associates, but it doesn't mean that we couldn't contemplate also partnership with, I would say, a specialized player. And indeed we are already doing it. Just a recent illustration is in the framework of the global partnership, we, as with First Eagle, we are, we have a specific partnership, I would say, to distribute outside of the U.S. some of their capabilities and expertise and products in private debt. So it's an illustration of something we already do and we could also do more if we find the right partners, the right product for clients. Last question related to BOC. Well, you are, sorry, yes.
You are mentioning the recent shift in public policies and the stimulus. It's clearly too early to see an impact and to assess the impact in Canada on activity. It's too early, basically.
Can I just ask a follow-up on the public-private partnerships? I mean just do you see a lot of appetite for engagement from private market managers? I know that you said that you would have a partnership with First Eagle. I guess beyond that, do you see appetite for many other private markets managers to partner up, given that we seem to be seeing an acceleration in the ability to tap into Retail? Thank you.
Clearly there is an interest from these kind of players in particular considering Amundi's strong distribution capabilities across the world and notably in Retail.
Great, thank you very much.
Okay. Thank you, Nick. Next question comes from Jacques-Henri Gaulard. From Kepler Cheuvreux.
Yes, good morning everybody.
Just following up on the excess capital question. I think I remember Nicolas, you saying.
That post the Victory deal you had.
Some minority interest threshold that had actually.
Increased your capital requirement. Therefore I think if the idea was to say that you had EUR 2 billion of excess capital at the end of 2024, that was assuming your minimum capital requirement was 10. And what would be this minimum capital requirement? Or to make it simpler, what would be the excess capital at the end of Q3? Would it be closer to 1.4, 1.5, 1.2?
So thank you, Jacques-Henri . The impact of Victory broadly will be the closing will take place in a few months, will be broadly neutral on our capital position, which is also logical. It's also neutral by the way, in terms of cash. But it will have a positive impact on our earnings per share. And then your second question was on capital position. As of today we are still around EUR 1 billion.
Okay. Thank you, Nicolas.
You're welcome.
Okay, I don't think we have any other question. If you have some second thoughts. Probably the last opportunity to raise your hand. No? Okay, I think that we're done here. I don't know, Nicolas or Aurélia, if you have any concluding remarks?
No, nothing more. Thank you very much for your participation and hope to see you soon for the end-of-year results
And before.
That, our sell-side dinner.
Sorry, our dinner in December.
Okay, looking forward to it. Thank you very much. And obviously we are available, Thomas and Annabelle and myself, for any further questions that you might have. Thank you very much. Bye b ye.