Good morning, everyone. I'm very happy and proud to introduce this presentation of Société Générale's strategic orientations in French retail. In late September, we started a study on the creation of a new retail bank in France through the combination of Société Générale and Crédit du Nord. During the last two months, more than 500 people worked to design this new bank. Executive, obviously, but also bankers who interact daily with customers, and experts who master new technologies. I would like to thank all of them. They work on this project with team spirit, sense of innovation, and passion. Thanks to the hard work, we are here today to present a new retail bank in France, a bank with ambition for its clients and its teams, a bank efficient and profitable, a bank with character.
The same dynamic has been in action in Boursorama to prepare the next step of the exciting trajectory of this bank. To begin with, I would like to remind you what is the SG Retail Banking franchise and what are the fundamentals of our strategy. Our two divisions, French Retail Banking and International Retail Banking, are serving 25 million clients, corporates, professionals, and individuals in Europe, including France, Russia, and Africa. Retail banking is a strategic asset for the group, accounting for 54% of its revenues. We aim for a leading position in the countries where we operate. We are in the top three positions in most cases. Our product lines are strong, notably consumer finance, and we have developed important synergies with the other businesses of the group. As you know, this business is undergoing major changes.
They are quite similar in all geographies and have been accelerated by the pandemic, changing clients' expectations, acceleration of the digital trends, new entrants, uncertain macroeconomic environment, and increasing regulation. In this context, our vision for the future is based on five key axes. The structure or actions in all our retail banks. First, it is critical to implement differentiated relationship models to address the diversity of our customers' needs and for each of them to deliver a best-in-class client experience. Simultaneously, we develop new business models organically or by acquisitions. Our most impressive success has been Boursorama, but I could mention many other initiatives, Shine in France, YUP in Africa, and more to come. Of course, extending the range of products is also essential. We are as well very aware of the utmost importance to reduce the cost base.
It is key to ensure the financing of our projects and the profitability of our business. Finally, we act according to the highest standards in social and environmental issues, risk, and compliance. Five main levers are at the service of this vision. First, expertise. It goes without saying, I mean financial expertise, but also talents and skills related to the new trends in technology and data science. Digital tools. We are investing a lot in new technologies to deliver client satisfaction and internal efficiency. Use of data. We have built strong data hubs. For sure, data management and artificial intelligence will be the spine of our new marketing, risk, and compliance tools. Open architecture. To deliver to our clients the best offer, it is necessary to build strong partnerships with third parties. As such, the new open architecture for asset management products in France is very emblematic.
Finally, sharing best practices and tools across the group. Our new governance, with a unique supervision of all the retail banking activities, will help us to go further in this direction. With this global framework in mind, we can focus now on France. All the challenges I have mentioned are present in France. Nevertheless, the competitive environment is specific, with the presence of mutualist banks, which maintain a strong physical presence in the territory. On this slide, we provide with a snapshot of the French retail market. Let me just highlight three key messages. France is an attractive market with strong savings rate and dynamic corporate landscape. Trends are positive. The population is growing, and France attracts a significant amount of international investments. Last comment, the retail banking market is growing and sound. You know the group. We have three brands in France. Let's keep Boursorama aside for the moment.
Société Générale and Crédit du Nord have achieved a lot in the context of the 2017-2020 strategic plan. Société Générale, with 7.3 million clients, has undertaken a profound transformation. I will focus on three points. First, we have made a huge effort to upskill the teams and recruit new talents to reinforce our expertise. A special attention has been given to the corporate and mass affluent segments. We have redesigned the setup, closing 20% of branches and 30% of back offices. We have digitalized most of the client journeys and internal processes. Crédit du Nord, a group of regional banks with 2.4 million clients, has also significantly improved its relationship model. We have strengthened the setup dedicated to the professional segment. For the individuals, we have differentiated customer approaches relying on a new client segmentation. We have closed 50% of branches and defined new branches format.
We have launched the Bank-as-a-Platform initiative and implemented partnerships with third parties. In addition, we have increased cost synergies among the two networks. We have mutualized the IT infrastructure as well as a significant part of the systems, operations, and transversal functions. Sébastien will elaborate on the next phase, the creation of a champion. I just want to mention three points. One, our assets are priceless, attractive, and complementary client bases, strong brands, highly regarded franchises in some sectors and geographies, common values, last but not least, great teams. Two, now is the right time to go further because the COVID context is pushing for an acceleration, but also because the transformation of our network has been successfully completed. Therefore, we can build on a strong starting point. Three, our target is ambitious.
Our main goals are to be on the podium in client satisfaction in our three core markets and to deliver a solid double-digit return on equity in 2025. Turning now to Boursorama. Benoît will disclose the details of our project, but let me mention that Boursorama has a powerful business model. Boursorama has more than 2.5 million clients. We propose to our clients a product offer which is both simple and comprehensive. The operating model is scalable. We can easily grow from there, as we did during the last years. The client base has been multiplied by 2.5 since 2016 with only 100 additional staff. Obviously, we apply in Boursorama the group risk and compliance standards. Boursorama is a well-structured bank, a safe bank. In a nutshell, both the foundation and the momentum are strong.
Therefore, because there is still an important potential in France for full online banking, our ambition is to reinforce our leadership. Two main objectives: 4.5 million clients in 2025, around EUR 100 million net income in 2024, rising up to EUR 200 million in 2025 with a return on equity in excess of 25%. A word of conclusion before leaving the floor to Sébastien.
I'm convinced that these two exciting initiatives, the creation of a new retail bank combining the strength of Société Générale and Crédit du Nord, and the new acceleration of the development of Boursorama, will significantly reinforce our position on the French market. Actually, this position will be quite unique with these two complementary models. It will allow us to cope with the market changes, to better meet clients' expectations, and to deliver a sustainable profitability. I look forward to share our future successes with you and all SG teams. Thank you for your attention.
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content
[Non-English content]
[Non-English content]
[Non-English content]
Good morning, everyone. I'm very happy to be here today. As you know, on September 23rd, we announced the launch of a strategic study on the combination of Crédit du Nord and Société Générale. Before we go into the details, I would first like to thank all the people who have contributed to the study for their hard work and team spirit. Over the last two months, there has been an outstanding level of commitment and energy from all the teams involved in the strategic dialogue. I'm here today to share with you the main conclusions. Let me get straight to the point. Our strategic decision today is to go ahead with a combination of the two networks. We have gone as far as we can with the mutualization. This is the logical next step to fulfill two objectives, maximize client satisfaction and establish a more efficient model.
Today, I will share with you our vision of the bank that we are building. Before, I will address the main questions you have raised about this combination by discussing five points: the model for clients, the synergies, the IT, the staff and the execution process. Let me start with the central point for us, the client. As Philippe mentioned, now it's time to enter a new phase and further shift the relationship model to offer a more personalized client experience and to improve the client journey. Digital is a cornerstone of our model. Wherever relevant, there will be a digital solution. Our bank will be fully digital for the day-to-day banking of both individuals and corporates, with more client autonomy for basic products and a higher share of digital sales.
With more digital, branches will be centers of expertise, places where clients discuss their needs with relationship managers totally focused on providing value-added expertise and on finding the right products for clients. Our new bank will offer the right setup and products offered to each client category. We will continue to develop tailor-made solutions for corporates, leveraging on the expertise of an international group. For professionals, the new bank will be the trusted partner for both private and professional needs. We already have a strong market position in this segment and we will continue to offer the best digital tools with Shine, for instance. Affluent clients, which represent around EUR 150 billion of assets under management, must be treated differently. They have higher expectations in terms of advice and more appetite for value-added products and services.
There will be a dedicated setup for these clients with a truly differentiating approach on savings in open architecture. For the individual customers, we'll fine-tune our dynamic client segmentation to better target their needs, leveraging on digital and data while decreasing the cost to serve. This will enable us to maximize client satisfaction. Our objective is to be in the top three with our core client base, corporates, professionals, and affluent clients. Let's hear what our teams say.
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
[Non-English content]
To achieve this objective, we will notably build on the strength of each brand and use the best of each proposition to offer more value to our clients wherever they come from. What is important to understand, as you can see on the slide, is that we are improving the value proposition for each client, whether on offer, on setup, or on digital. This client experience will be notably improved thanks to our capacity to make more focused investment. More specifically, we will also significantly enhance the savings journey of our affluent clients with our new innovative approach in open architecture. Obviously, this combination will generate cost synergies with a direct impact in terms of net cost reduction in 2025, totally in line with precedents from M&A transactions. First, we'll have a more efficient network while remaining strong in the regions with the same local presence.
More than 60% of Crédit du Nord branches are within one kilometer of a Société Générale branch. We will thus reduce the branch network by a further 30% by 2025. Second, we'll have one set of centrals and support functions, one headquarters, all central functions merged, and obviously more efficient support functions leveraging on best practices. Third, we will have one single IT system. Having only one platform to run and to upgrade will reduce our IT costs and focus IT development on a single system instead of diluting investment between two networks. Let's hear from our expert, Bruno Delas, on our IT strategy.
Our strategy is to build the new bank model by mobilizing all necessary IT resources and skills to create a unified platform. For the first step, we have chosen the Société Générale platform rather than the Crédit du Nord platform. This is because it is digitally advanced, has richer function with more features, and is more advanced in terms of regulation. For the second step, we will consolidate the Crédit du Nord platform into the Société Générale platform in order to optimize our IT costs and to reduce our time to market. For the third step, we will concentrate our change investment more efficiently into one single platform. This will on the one hand, enable us to accelerate the business opportunities of the new bank and on the other hand, accelerate regulatory aspects and of course, the digitalization of the platform.
This strategy will get us to our ambition of building the next generation of the French retail banking IS by 2025. Zoom number one, how will we consolidate our platform? We will do that by a data migration in three steps. Step one, extracting data from the 2.4 million customer of Crédit du Nord platform. Step two, transcoding this Crédit du Nord source data to Société Générale format. Step three, loading the data onto the target platform, which will at that moment total 10 million customers. These three steps will be repeated various times over several months in order to expand the perimeter and the quality of the transcoding data until we obtain the right quality check level. During all this time, there will be no impact for the client and for the advisor.
Once we have obtained the right quality level, the advisor and the client will switch from Crédit du Nord platform to the target over the weekend. After this switch, they will benefit from all the new available services on the target platform. Within our IT team, we have the experience and the skill for such a consolidation project as we have already done this before successfully within our group, such as Société Marseillaise de Crédit. In the meantime, we will continue enriching the target platform. What is our 2025 target? Our target is to build the next generation of retail banking platform. Here are just three example of major business requirements in the upcoming years. Example one, we want to adapt our level of services depending on the potential of the client using the technology of our call center.
We will then progressively leverage this technology to all our channels of interaction with our client. Example two, we want to pursue the rollout of our mobile and secure workstation for all employees of the new bank. They will have secure access to all collaborative tools and bank services. While remaining, of course, in direct touch with clients at all times through various channels. Example three, we have already started, and we will continue to provide new banking and non-banking offers and services from third-party partners. This enables us to create a next-generation marketplace like most big tech leaders have done before. We will also, in the meantime, keep building an open future using our fintech ecosystem, grow our relationship with major tech players, and make some of the platform available at European level.
What does this project mean for our employees? A new way of working with more autonomy, more expertise, and better tools to help them create more value for clients. It will mean new development opportunities. We intend to invest more to develop the expertise of our staff. Continuous upskilling is essential, and it will enhance their career development. Advice, expertise, and commitment are the cornerstones of our model. Needless to say, the transformation will be managed in a very responsible manner, as we have always done in the past.
A dedicated human resources setup will be put in place to accompany our staff to adapt to the changes. As you can see, we are embarking with our staff in a project that creates value. Turning to the execution of our project, let's be clear, we have the capacity to successfully execute. We have the experience, and we also have the right teams to execute.
In addition, as it is an internal combination, we know the two entities perfectly, and we have mapped all the execution steps. Let's recap what is at stake here. First, on IT migration, you have heard it from Bruno. For all these equations, we have adapted answers with a clear and under-control roadmap. Second, on human resources, we will make sure that our key talented staff are retained. Pertaining to our clients, we will constantly focus on improving their satisfaction, including in the transition period, and we have a clear roadmap on this point, too. Last, our organization and timetable are designed to ensure successful execution and get significant benefits from 2024 and full benefits from 2025 onwards. IT and legal projects are scheduled to be finalized by early 2023. This timeframe is totally consistent with the usual standards to address all these points smoothly.
We know that we can count on experienced and committed teams to make this combination a success while maintaining a safe, effective, and efficient one. Turning to financial targets. As you can see on slides, this combination will generate significant cost reduction with project costs in line with market standards. The 2025 RONE target is between 11% and 11.5% under Basel III, equivalent to 10% under Basel IV. Turning to the future, let me share with you our vision of the client journey of the bank of tomorrow. On this first slide, you see our clients as they stand today with a significant part of our revenues made with corporates, professionals, and affluent clients. We have a diversified and attractive client base, we are particularly strong in most dynamic regions. Within each category, subsegments have their own specificities and require our tailored advice and expertise.
This is what drives our model. Moving on to our ambition. We want to be the winning universal retail bank. In our view, several factors will make the difference. We'll further shift our model to combine the best of digital and human expertise. Leveraging on digital to free up commercial time and focus experts on value-added advice is key to better serve our clients and to allow for accessibility, immediacy, and expertise. We intend to maintain a strong regional presence with local expertise, and we will leverage on digital data and AI to further improve the client journey with innovation being at the heart of our model. We strive to provide the best products and solution adapted to each client's category and subsegments, be it in-house or manufactured by partners. Obviously, we will deliver operational efficiency with an optimized cost base.
Of course, we will keep our best-in-class compliance and risk standards. Last but not least, responsibility will be the DNA of our retail model. If we take one of the most important pieces of the model, the use of digital, data, and artificial intelligence, we are already very well-positioned. Many awards and rankings prove that. In Société Générale networks, digital penetration is already above European peers, thanks to a best-in-class app that we will keep enriching. More broadly, and just using some very illustrative examples, we aim to be the bank which knows its client better to personalize their experience.
As an example, we have been the first bank to offer account aggregation with Fiduceo. It now provides personal finance management and aggregation of private banking client assets. These functionalities are a strong differentiator in a context where affluent clients are keen to use more digital services. We also want to accelerate to have the best interactions with our clients. To do so, we have to handle the flows and use the right channel for each need. Our project, SG Talk, based on AI, will manage the flows and direct the client towards the best channel immediately.
Today, 60% of the day-to-day banking, which can be done fully online, still goes through branches. We estimate that SG Talk will help us to avoid 35% of incoming calls and emails in branches to focus our teams on expertise. This is also a way to improve experience with bankers. Predictability of client behavior through machine learning will further help us on interactions. Overdraft predictability is already deployed on SG networks, saving each banker 40 minutes a day. Finally, digital will be used to integrate risk and efficiency standards. Just one example. We want to position the bank as a leader on security and digital protection, and we have the tools in-house, like Mosaic, which needs less than 0.5 seconds to detect a fraud on instant payment. Our clients already make good use of digital, and we set ourselves target, which reflect our vision of digital usage going forward.
For 2025, we target to have more than 80% of eligible products combining physical and online. We aim to have around 30% of digital-only sales on eligible products, and we plan, in 2025, to have more than 80% of the corporate offer available with electronic signature. Let's now have a look at the offer for clients. What matters is the value proposition for clients, be it in-house or, as I said, manufactured by partners. This is also the way our IT system is designed. You will find some selected example on this slide. This illustrates our culture of innovation with many concrete initiatives already launched and more to come. On group expertise, for instance, we'll have local ESG expert to accompany SMEs with their energy transition.
Another example is Shine for entrepreneur and very small businesses, a dedicated responsible neobank we acquired this year, which simplifies the banking and administrative experience of our clients. We can also mention our internal startup call and all the resulting initiatives and partnerships. There will be a lot to say as well, for time's sake, let me focus on our value proposition for savings. Savings is at the core of our retail banking strategy, we are pioneering new business models here to offer our clients the best products available on the market. Therefore, in addition to Amundi, we have partnered with those who do it best. We have teamed up with BlackRock, DNCA, La Financière de l'Echiquier, Mirova and Primonial.
Société Générale will be the first large French bank to offer an open architecture for savings, with an innovative offer with seven partners, enabling clients to access the best expertise on the French market and internationally, with a systematic integration of ESG factors. We will also be the first retail bank to offer a complete range of SRI funds and environment solutions through open architecture. This will enable us to improve the value proposition for clients with this wide range of offers, combined with personalized advice based on the risk profile and client appetite. Let me now elaborate a bit on the setup. As mentioned, while moving from two networks to one, we plan to remain as close as we have always been to our clients, not cutting any proximity. Regions will remain at the center of the model, bringing reactivity, proximity and understanding of local situations.
As I said, we will optimize our network with the same local presence. We plan to decrease our network from around 2,100 branches in 2020 to 1,500 in 2025, and branches will be focused on expertise for clients. Teams will be empowered to better answer our client needs. Decision-making process will be made locally with an agile organization. Let's elaborate on the importance of the local footprint. To conclude, this project is completely in line with our strategic priorities at group level. First, client centricity, totally embedded in our vision.
Second, ESG. At group level, at business level, of our clients. It's a key priority for us. Third, efficiency. We are building a more efficient model with significant recurrent synergies. We will be delivering sustainable profitability. Obviously, we could spend hours working through our various initiatives, discussing our positioning by each category of clients and dedicated strategy. My time is up, and I will be very happy to answer your questions in the session to come. Let's now turn to Boursorama.
Boursorama reached its position of leadership only three years ago, and since then, has left far behind its historical online banks and neobanks competitors, despite a more and more competitive environment, and thanks to a strong growth acceleration. In 2017, our goal was to reach two million clients by 2020.
With more than 2.5 million clients as of today, this goal has already been exceeded, and the customer base has been multiplied by 3.5 in the last five years. Today, in the French market, Boursorama is the leader among challenger banks. Boursorama is the leader in number of clients, both in the volume of existing clients and in the flow of new clients. Boursorama is the number one online broker and the first financial and economic portal in France. Boursorama is by far the most well-known brand among challenger banks, but has also made a name among large traditional banks. Boursorama is the most appreciated bank by its clients, with a high net promoter score of + 48 and a rate of recommendation of 90%. Beyond growth, our clients are mainly quality clients. They are the ones all banks want.
They are young, 36 years old on average, wealthy and active. 84% use the bank every month. In addition, and due to our rapid growth, most clients are still recent, and they have not yet fully realized their potential. To make a long story short, Boursorama is the first challenger bank with the highest growth pace in France. To understand Boursorama and its potential, it is key to understand its consistent and unique model. We succeed because we have a strong and powerful alternative banking model. All starts from a full client autonomy. Clients become clients, buy products, use services, manage their accounts, take investment decisions by themselves. This is made possible thanks to an operational model designed for automating all the steps from front to back office. This is the crucial point. The whole company is focused every day on this central goal.
How can we improve our efficiency to create the best user experience and to generate the best underlying profitability? Keep in mind that Boursorama is a full-fledged bank run by 800 people. The second huge strength compared to competitors is our offer. Boursorama is the only digital bank with such full range of banking products in open architecture to get best quality, allowing us to generate loyalty and revenues. In a nutshell, we could say that Boursorama is a full efficiency of a pure digital player with a full range of offers of a traditional bank. Our alternative model generates client satisfaction, recommendation, growth, and at the end, a high level of profitability.
As Benoît just mentioned, our relationship and operational model is our key asset. Hard to replicate, it really constitutes our main competitive advantage. It is based on three totally aligned elements. First, it relies on our native and digital-only offer. We have no branches. Our clients can access to our full range of products and services through best-in-class mobile apps. We've been ranked top first in France in our mobile apps. Second, it is based on our digitalized and automated processes, even on some complex products. Two examples. In mortgage loan, we produce each year EUR 3 billion, which represents approximately 2% of the market, with only 60 people from front to back. On the consumer loan, already 20% of our production is done with no human touch. Third element of our efficiency is related to the way we manage client interaction.
We invested in AI-based solution to be able to answer clients' question 24 hours a day through our chatbot, Eliott. Eliott is already answering 40% of clients' question and represent from this year the first channel of interaction with our clients. Discuss efficiency can be illustrated in 2020. We acquired more than 550,000 new clients with only eight new people in Boursorama. All in all, the cost to serve our client is EUR 70, and it has been divided by more than two since 2015. Boursorama is also able to equip the client and generate NBI. On average, a client in Boursorama have more than EUR 15,000 in terms of assets and loan, which is far beyond the EUR 500 of assets recorded by new banks. This level of activity can be explained by two things, the product themselves.
We offer our clients the best value proposition in terms of pricing, performance, and user experience, either by proposing our own products or by proposing open architecture, especially on the brokerage activity or long-term savings. It is also related to our ability to use data. We have no sales people in Boursorama, so we use data to push the right product to the right clients, and more and more, we develop solutions to digitally advise our clients, especially in the daily banking and in the saving spaces. We can see this level of activity at two levels, macro level and micro level. At a macro level, if you're looking at the evolution, we have EUR 30 billion in terms of asset and loan. This evolution is totally consistent with the evolution of the client base, and each product segment has an evolution beyond the market.
At a micro level, if we look at the yearly evolution of assets of new clients, we can see that it is consistent by vintage, and that it's been multiplied by more than three in the first seven years of client relationship. Boursorama is best in class in terms of cost efficiency. We can generate NBI, and this powerful business model has been fully demonstrated in 2020. Despite the COVID crisis, in terms of commercial activity, we hit numerous records. First, we hit records in terms of the number of products subscribed by our clients, in the total amount of savings from our clients, in the amount of production of mortgage loans, and in the brokerage activities.
In the brokerage activity, we fully leverage our leadership position, and we recorded already a number of trade that is twice the one that we had in 2019, with even a record day where we trade 100,000 trades a day. This tremendous commercial activity is reflected in the underlying NBI that rose by 35%, and at the same time, the operating expenses, including marketing costs, were nearly flat, and the cost of risk, including forward-looking add-ons, declined by 6%. This outstanding year reflects the intrinsic profitability of Boursorama.
If we look at the P&L of Boursorama, we really have to keep in mind that the pace of growth of Boursorama has nothing in common with any other competitors in France. The acquisition costs of our more than 550,000 new clients is taken for full the year of the acquisition. They are 90% variable, and they represent 40% of total costs. If we correct the P&L from this massive acquisition effect, Boursorama can be profitable at a touch of a button with a net result that exceeds EUR 40 million and that had double compared to 2019. We strongly believe that Boursorama is the online winning model.
What about the coming years? As said by Aurore, 2020 was a very positive year, and has proved, if needed, the relevance of a full digital model. All economic studies confirm the fact that the crisis of the COVID has accelerated existing trends. Four of them fit perfectly with the positioning of Boursorama. About digital acceleration, no comment. About buying power's sake, we offer best prices on all the products in order to make save money for our clients. This is not magical. This is one of the consequences of having the best cost to serve. About a possible reshuffle of savings landscape due to low-rate interest context, it seems that our clients start to think about a riskier and longer investment strategy in order to get some yield. It could lead to a revival of the brokerage activity and of new ways of investing.
It's perfect. We are number one on this field. To complete the picture, CSR is more and more important in clients' choice. Here again, Boursorama is natively a CSR firm, integrating this dimension in our no-paper processes, in our clients offers. For instance, we have dedicated CSR investment profiles, green consumer loans, solidarity livrets. In our staff organization, we have just signed last week an agreement with our trade union in order to put in place a very innovative new way of work, and we got very clear roadmap on this matter. Thanks to its leading position, and because Boursorama is fully in line with the main learnings of the crisis, it's time to accelerate. What are our targets in the coming years? First, we want to become a bank of more than 4 million clients by 2023 in France.
To get there, we plan to carry on a massive growth in the next three years. It does not mean a significant change versus our previous strategic plans that we have successfully implemented. It means a strong support from Société Générale, as we should generate a EUR 230 million loss during the growth period to build up a such bank. To achieve all this, we will not exceed 1,000 people, staying focused on efficiency. As soon as we stabilize growth after 2023, we will be able to generate a profit of about EUR 100 million by 2024. About the double in 2025, with a RONE above 25%. Being so, one of the most efficient bank on a financial point of view. To conclude, Boursorama want to be a major retail bank in France by 2025, with 4.5 million clients and with a EUR 200 million net profit.
Good morning to everyone. I'm delighted to say a few words of conclusion for this session. One thing we have nurtured in the last years is our culture of entrepreneurs, of pioneers able to build new business model, thinking forward and to disrupt if needed. Let's admit, the banking sector has not been that good at doing that. As we all know, perspective for retail activities in the Eurozone will remain challenging going forward. First, the health crisis has a significant impact on our economies. Second, we are probably in an environment of low interest rate for long, and we have to draw all the consequences on the business models. The need for cost efficiency is even more significant. Third, maybe more important, this crisis accelerates trends. We are in the middle of a technological and digital revolution. We see the development of new competition.
Client behaviors are evolving quickly. We have to anticipate, we have to be among the banks to take that technological wave. We have to think about the client needs in the next five to 10 years, and in particular for individual clients. I've already shared with you my conviction that saving advisory will be at the heart of the relationship between individual clients, and let's admit that there is room for improvement in that field regarding the banking industry. Thanks to the transformations implemented in the last five years, our French retail networks have been able to post resilient profitability, including in that crisis. We have to anticipate, we have to remain ahead of the competition. That's why we launched in September the study to combine our two French retail networks. We engaged during the last two months with our staff in our branches.
We engaged the discussion with our clients and our bankers. This was an intense and remarkable work led by Sébastien. Today, we confirm our ambition and capacity to further differentiate and build a unique dual model in French retail. First, build a new bank by combining our two networks, taking advantage of their respective leading expertise. This new bank will be best in class in saving advisory and in the quality of investment solutions for individual clients, and will also enhance its leadership position with corporate and professional clients, fully leveraging on new technology. The second element of this dual model will be to bring Boursorama to maturity. Boursorama will not just remain the undisputed leader in online banking in France, but will become one of the leading banks for individual clients with 4.5 million clients and with a unique value proposition.
Number one, in terms of client satisfaction, the cheapest bank in France, and a profitability on capital, which will be almost three times higher than any traditional network. Client centricity, ESG and responsibility, innovation and digital technology will be at the heart of this dual model, which is the right one going forward. This is my conviction. I'm fully confident that we have the right team to build it successfully in the coming years. Thank you. Let's now open the Q&A session.
Hello, good morning to all of you. Thanks for attending this Q&A session following our presentations on our two strategic initiatives for our French retail activities. I hope you have been able to watch our different presentations. We will be there with all our management team to answer your questions. Let's start. Let's keep perhaps the discipline, just two questions per person. That would be nice. Let's turn to you, floor is yours. The first question, please.
Ladies and gentlemen, if you wish to ask a question, you may press zero one on your telephone keypad. We have one first question from Mr. Jean-François Neuez from Goldman Sachs. Sir, please go ahead.
Hello, Jean-François. We can't hear you, Jean-François. Jean-François? Jean-François?
We have another question, sir.
Yeah.
We have from Mr. Stefan Stalmann from Autonomous Research. Please go ahead.
Yes. Good morning, gentlemen. I hope you can hear me well.
Yes. Good morning, Stefan. How are you?
Fine. How are you? Thank you very much for hosting the event. My two questions are the following. You talk about net savings that you target by 2025. Can you give us any sense of how high the gross savings are that you're generating during this period to get to your net savings number? The second question relates to the cost to achieve these savings, the EUR 700 million-EUR 800 million. Could you maybe break those costs down into major buckets, in particular, how much of that relates to software impairment, how much relates to severance spending, and how much relates to the breakage of lease costs? Thank you very much.
Yeah, thank you, Stefan. I will turn to Sébastien Proto to answer your two questions. Sébastien.
Yes. Good morning, Stefan. Coming back to your first question. We are steering our trajectory on an absolute cost base, and, in our view, that's what is important, and I guess that's also an important indicator for you, the kind of indicator you are looking at. This net reduction, the cost base in 2024 and 2025, includes, of course, the synergies from the project, as well as investment in growth initiatives and other costs.
When you compare with precedents in terms of M&A mergers and M&A transactions, the percentage of savings is totally in line with precedents. Regarding CTA, we gave a range between EUR 700 million and EUR 800 million. Again, that's totally in line with peers, this kind of amount. We don't give the weight between the different components of CTA. What is important is to keep in mind that the percentage is, again, totally in line with precedents.
Thank you. Next question.
Next question is from Mr. Jean-François Neuez from Goldman Sachs. Sir, please go ahead.
Hi. Good morning. Can you hear me?
Yes. Now it's much better, Jean-François. Hello. I hope you're well. Yes.
Yes. Thank you very much.
We could not hear you at the beginning. Yeah.
Sorry. My bad. I just wanted to ask, not necessarily related straight to the financial target, but more operationally. I just wanted to ask, when you think about the mergers as well as the IT integration, for example, for having been clients of Crédit du Nord and so on, I know that when branch change, account number can change. For example, recipients of payments on the app can be removed and have to be [reinstated].
I just wanted to understand, how you believe, how you see, or how you measure the efficiency of your IT platform with regards to compare to that of competitors, and how you planned for the merger of the networks from a client transition perspective, if any, and the branch closure, which are very significant, and obviously an acceleration from the past in order to minimize client attrition as typically happened for all banks which merge networks. The reason why I'm asking this is I just wanted to understand what you baked in in the 11%-11.5% return on net equity, revenue trajectory.
Yeah. Thank you, Jean-François. Perhaps we have the benefit of Bruno Delas on the IT, I will turn again the floor to Sébastien, who will take globally your questions. Okay.
Thanks, Jean-François. Thank you very much for your question. I will let Bruno Delas comment on how it works precisely on the IT side when a client has a change of branch. Regarding your question about the impact for the client and what we have embarked in our financial trajectory in terms of attrition due to the changes of branches. Keep in mind that, first of all, we have an overlap between the two client bases, which is very, very limited, around 1%. Second point, what is important here is the fact that the branches of the two networks are very close to each other. Very, very close. What does it mean? It means that clients will not be affected by branch changes. More than 60% of the branches of Crédit du Nord and Société Générale are less than one kilometer apart.
It means that we can optimize the network while keeping the same local presence. It means also that for the clients, his new branch, if any, will be very, very close from the current one, which is clearly something very positive. Because it limits drastically the attrition due to the change of branch. In our financial trajectory, obviously, we embarked prudent assumptions in terms of revenues, prudent assumptions also in terms of attrition. Even in a stressed scenario in terms of attrition, we are very confident with our targets between 11 and 11.5 under Basel III. Bruno, can you comment on the IT side?
Okay. [Non-English content], Jean-François. Hello, everybody. You know that the IT strategy is based on two main topics. The first one, we have decided to choose the SG platform because this one is the more advanced in digitalization. You know that during all the projects, we want to continue to concentrate our investment on this platform to reach the target of the new model for the new bank. At the same time, we have decided to consolidate the Crédit du Nord platform into the Société Générale platform. We will do that because we are used to do this kind of project within the group or outside group.
Maybe just to give you an example, when we talk about branches which are very close to each other. I take just one example in Paris, in the 17th district of Paris. Crédit du Nord is located 45 Avenue des Ternes. Société Générale, 40 Avenue des Ternes. It's just an example, but it explains why we are very confident that optimizing the networks will not increase or have a very important impact on attrition.
Thank you. Next question.
Next question is from Mr. Omar Fall from Barclays. Sir, please go ahead.
Hi. Thank you for taking my questions and for the interesting presentation. Just firstly, I'm just working it out. If there's a EUR 5 billion cost base for the networks and maybe another EUR 200 or so for Boursorama. If I take 30 basis points cost of risk, which is through the cycle level, to then get to your RONE targets, it kind of implies a revenue decline from this year, like EUR 500 million or so. I know you don't want to give certain guidance on revenues, which is understandable in this environment, but I'm sure there's something wrong with that math, so maybe you could help me with that.
The second question is just on Boursorama. Could you give us a sense of what the proportion of primary active clients at Boursorama were, what they are now? I think it suggests 50% on slide 58. I'm not sure if I'm reading that right. How conversion of active to primary clients plays into the strategy going forward. I know we discussed this quite a bit at this divisional presentation last year, maybe just an update on that would be helpful. Thank you.
Hello. Good morning, Omar. I will turn to William first on your maths, and then to Benoît, who's the new head of Boursorama. William.
Hello, Omar. Happy to run you through the bits and pieces that are behind the trajectory. We have taken three assumptions. First, it's very prudent assumptions on revenues, but it doesn't mean that we are seeing declining revenues. We take an assumption of gradual normalization in cost of risk, so at the end of the period, we come back to a more normal situation. You have to factor in, on top of that, what Sébastien has explained regarding costs. Overall, if you take some expansion in the RWA base in 2023 pertaining to Basel IV, you get fairly easily to the number we've articulated, but happy to go more in detail in a session afterwards.
Benoît?
Good morning, Omar. Thank you for the question. I think you have seen the figure. It's 50% of our clients, five, zero, which are in the primary bank with us. I think it's related to the fact that we put in place some new strategic actions. I just give you an example that we have some inactivity fees right now regarding debit cards. As we explained it for a long time now, globally, our outstandings are growing exactly at the same pace than the growth of the client database. You have seen that we have multiplied by three, 3.5, the number of clients in the last five years.
The global outstandings of the bank, if you take deposits, for example, it's exactly the same. Our current accounts, on average, it's EUR 2,800 per client. Just the current accounts. Globally, it's EUR 15,000 if you take into account all the products we have with our clients, I mean, credits, savings, investment products, and so on. We do something, which is we're building up a very strong and a very active bank with our clients.
Thank you. Next question.
Next question from Madame Giulia Miotto from Morgan Stanley. Madame, go ahead.
Yes. Hi, good morning. Two questions from me as well. On Boursorama, you're targeting a very fast growth of four and a half million customer by 2023. Aren't you afraid of some cannibalization? Boursorama is very efficient, but from my math, you make more or less EUR 120 revenues per customer versus EUR 750 in the branches. If you can comment on any potential for cannibalization, that would be the first one. Second, 2024 for the first cost synergies and then full by 2025. Can you comment on timing? Why so long versus some other mergers that we're seeing in the market which are achieved in two to three years? Thank you.
Yeah. Hello, Giulia. I will turn the floor to Sébastien, your two questions.
Yes. Good morning, Giulia. On your first question regarding potential or risk of cannibalization from Boursorama. Everything starts with our client base, and keep in mind that we have half of revenues coming from corporate and professional. And if I add revenues coming from affluent clients, the total is above 70% of the revenues coming from these three categories of clients. We clearly are not the most at risk regarding potential cannibalization. And let me also remind you that we aim to be at the forefront of digital for clients who want it, and that we are convinced that some clients, and particularly within our client core base, want human expertise. That's something very important.
At the end, we will cover all the spectrum of client needs with two different models, Boursorama, digital only, and our more physical model, combining the best of human with the best of digital. We will cover close to 15 million clients with two different models. It will be a unique setup on the French market and a very, very good one. Regarding the timing for cost savings, that's a fair question, obviously. Cost savings mainly come from IT and from optimization of networks and central function. The trigger, what is the trigger? The trigger is the IT migration and the effective legal merger of the different entities. Everything will take place early 2023. I want to go into the details. Regarding the IT migration, the timetable, 2023, is perfectly consistent with market standards. I will let Bruno elaborate a little bit on this.
That's market standard, and market standard with an execution risk, which is in our view, more limited compared to precedents in terms of merger, because we know by heart the two systems, the two IT systems, and we have a team with very high level of experience for this kind of migration, because they did exactly the same kind of migration at Crédit Agricole or at BPCE in the past. Regarding the social timetable, again, it's consistent with French law. We have to respect the French social regulation, which is more demanding, more stringent than in other countries. That's why you cannot compare merger outside of France and merger in France.
The social law is different, and again, more stringent in the French market. Having said that, we said in the presentation you had this morning, early 2023, that's the maximum for us. Let's be clear, Giulia. We will work hard to have the best timetable. If we can move quicker, we will do it. We are working hard on both sides, IT, legal merger, to have the best timetable possible, but taking into account the social constraints. Bruno, do you want to say a word about IT?
Okay. You know, on the market, the timeframe to do this kind of job is respectively 24 months for the data migration and six months for switch the nine banks from one platform to the other. If we could do better than that, we should. For sure, we will know that only in one year, not now.
Perhaps the last comment from Benoît Grisoni on the attrition and where we collect the new clients.
Just to give you an idea of the cannibalization. If you take the new clients who come in Boursorama, it's exactly the same level than the market share of Société Générale and Crédit du Nord, no more. It means that around 85%-90% of our new clients come from other banks. I think that this is the first point to have in mind. The second point is the roughly 15%-10% of clients coming from the group Société Générale, did they leave or can they leave Société Générale without Boursorama? As you know, there are a lot of competition on the digital point of view. If you take the two elements, I think it's quite reassuring, and there is no specific effect between the different brands of Société Générale.
Thank you. Next question?
Thank you.
Next question is from Mr. Tarik El Mejjad from Bank of America. Sir, please go ahead.
Hi. Good morning, everyone. A couple of questions, please. First of all, if you can share with us what's the Net Promoter Score for SG and Crédit du Nord. You've disclosed the one for Boursorama, which is very high, one of the highest. Just to see some comparison, and we can see the evolution of that metric, which is very important. Second question on revenues. You had very nice charts where you show basically your ambition to grow the marketplace with partnerships and your own fintech and so on, to build the fee component of the revenues. Would that be a big contributor to revenue growth in the coming years, or it will remain [inaudible] for the 2025 horizon? Still on revenues, last question. On slide 24 for Boursorama, you showed that you would have delivered a strong growth.
You would have EUR 230 million cumulative losses in the next three years. I presume these client acquisition losses would be mostly in the revenue side. Is that actually, should we expect a pressure from the top line from that component in the next three years, or is it split by costs within the EUR 700 million or mostly in revenues? Thank you.
Hello, Tarik. I will first turn to Sébastien and then to Benoît on your specific question on Boursorama. Sébastien, on the NPS, what we can share qualitatively.
Okay. Good morning, Tarik. On your question regarding NPS, what I can tell you is we have a different client satisfaction between Crédit du Nord and Société Générale. That's a fair comment, with different strengths between the two brands. Let me give you an example. In terms of professional clients, client satisfaction for Crédit du Nord is significantly higher than Société Générale. Our decision, perfectly consistent with this difference in terms of client satisfaction, is to take Crédit du Nord's model to address professional clients tomorrow. Regarding corporates for SMEs, again, Crédit du Nord is, in terms of client satisfaction, stronger than Société Générale. We have adjusted the model to take this difference into account.
We had a very granular analysis of the client satisfaction in order to build the best model for each client category. Regarding revenues, again, as William said, we have a prudent approach in terms of revenues when we talk about projection. We are determined and very committed to increase fees and the contribution of fees in our model. As far as fees are concerned, financial fees are obviously very important. When you talk about partnerships, what does it bring in terms of revenues, contribution of revenues? We expect a lot of our new setup in terms of savings. We will operate in an open architecture model. It will be a unique setup on the French market for large banks, and we will obviously expect a lot of this new architecture, open architecture, with a commercial push in terms of financial fees, which will be significant.
In terms of insurance products, again, we have different initiatives to increase the equipment rates, which are still below what they should be for protection and casualties. That's a lot of initiatives we are pushing very hard to increase the share of fees. At the end, our view is the following. We want to offer to our clients the best products, again, be it in-house products or manufactured by partners, because we think that this is the best way To get client satisfaction and more revenues.
Benoît, on the.
Yeah, thank you for your question. You have to understand the fact that there are two periods of time. The first one is 2021, 2023 included, where we want to grow as fast as possible, and with a global loss of EUR 230 million. We don't disclose the breakdown between what is in revenues and what is in the operating costs, as we don't disclose the client acquisition costs. You're right, there are things which are in revenues. I mean, customer rebates for this part, and regarding operating costs, it's regarding expenses related to the marketing part.
What is very important to understand is the fact that we are saying that we can acquire 2 million clients in three years. I think this figure is maybe important to have in mind. The second thing very important is the fact that 90% of the acquisition cost is variable, and all is a direct expense related to the client. There is no amortization. I mean, if we decide to not acquire clients, we are profitable directly without any delay.
Thank you. Can I just follow up? Sorry, on the first one, maybe it wasn't clear to me in the presentation, are you keeping the Crédit Mutuel brand and SG Network brands, or you're merging towards SG Network brands as well?
Okay. This question is also an important one. Regarding the brand strategy, we are still working on it. We don't give the detailed brand strategy today because we need more time to define precisely the brand strategy. Having said that, we want a brand strategy perfectly consistent with our ambition to be very enrooted in the different territory in the French market. We will not have only one branch covering all the country as a whole. We will use a common component, in terms of brands, with an add-on, which would be more local. Obviously, we are analyzing the strength of the brands of Crédit Mutuel. You know that Crédit Mutuel has different brands, Société Marseillaise de Crédit, Courtois, Tarneaud. We are looking at all these different brands to see what is exactly their impact in their territory.
Thank you. Next question.
Next question from Madame Lorraine Quoirez from UBS. Ma'am, please go ahead.
Yeah. Hello, good morning. Just two questions from me. How much are customer rebates and marketing costs budgeted at Boursorama in 2021? It would be interesting to know how this compares to 2019 and also have a view on whether these are actually down to zero by 2025 in your budget. The next question is perhaps a bit more high level. I was wondering whether you have given some thoughts on the impact that the digital euro could have on your business in the coming years. Thank you.
Yes, I will turn. Hello, Lorraine. I will turn to Benoît for your question on the evolution, the cost of acquisition, and then perhaps to Philippe Aymerich, who is monitoring our overall retail banking activities, and in particular on the payment side. He follows the EPI initiative and also how the ECB thinks forward regarding the digital currency. Benoît?
Yes. Thank you for your question. We don't disclose the client acquisition cost, but I can just give you an example. If you take the basis 100 on 2020, it will decrease by around 10% next year. I think that you said that the cost acquisition will be zero in 2025, but it's not the case. We continue to acquire clients in 2024 and 2025 in order to continue to grow, but at a very lower pace than during 2021 to 2023. The goal is really to have in mind these two period of time, 2021, 2023, we grow as fast as possible to reach the critical size, because it's now that we can get this market share. And 2025, we continue to grow, but at a very low level, and we are in a stabilization period in order to monetize and to get the most profitability as possible.
Knowing Lorraine, that's, again, that's my guess, but with a brand which will be better and better known, and already Boursorama, as you know, is one of the best-known brands, you should think forward in next three, four years with more than four million clients. I can't help thinking any way that there will be also even further traction from the brand, with limited cost for client acquisition. We don't bet on this, but my conviction is that it will be the case. Philippe, perhaps on the long-term.
Yes. Hello. Thank you for the question. There is still a lot of work on this topic about the digital euro. At this stage, it's not quite clear. Is it just a new payments capacity, or is it more than that? Of course, we are part of all this discussion. You know that ECB has launched a study, and we have to submit our answers by mid-January. In addition to that, I would like to say that, of course, payments is a very important component of a strategy. I think that what is very important is to keep in mind what are the needs and expectations of the clients. We have invested a lot during the last year, both on the corporate side and on the individual side on this topic. We will continue. It will be even easier because we focus our investment in one platform.
Regarding payments, we also believe in mutualization with our peers. As you know, we have Transactis, which is a platform share for the moment with Banque Postale, but maybe with other partners in the future. Yes, as mentioned by Frédéric, we are also part of the EPI initiative with over 15 European banks.
Thank you. Next question.
Next question is from Madame Anke Reingen from RBC Capital Markets. Madame, please go ahead.
Yeah. Thank you very much for the interesting presentation and the detail. Two questions, please. The first is on 2025. Obviously, it's a very long time from here. I just wondered how you got on about defining on how the customer relationships will look like in 2025. I saw on the slide you say 30% of digital-only sales are eligible products. Couldn't it be higher? On the 2025, is that now what we should consider as where the group could aim towards to, or is French retail just longer dated? Sorry, the second question is on the cost. You say EUR 5 billion for the combined group to go down. What is the remaining EUR 600 million cost? Should we assume they stay flat to 2024, 2025, or will they be coming down as well? Thank you very much.
Anke, hello. Good morning. Can you just perhaps rephrase the last sentence of your first question? I have not understood this concept of long dated. Can you repeat, sorry, this part of your question?
Yeah. I was just wondering, in the past, obviously, you always had the strategic plans out to, let's say, the last one was out to 2020. Is now 2025 the year?
Okay.
That you think the group will aim towards to, without predicting what your next strategic update might say? Thank you very much.
Okay. Listen. On that first, the bulk of the program and this transformation will be completed basically in 2024. Let's face it, the 80% of the savings. We've said 2025 because there will be just a complement in terms of the synergies. I think in retail, with the kind of transformation we are facing, probably it's also good to take a slightly longer-term horizon for also projecting. On the client evolution, listen, to be frank, I think it's a little bit difficult to predict what the French will do. As you know, the French are probably the one which are the less sensitive and which are moving the slowest to digital channel. Nevertheless, we consider that the crisis will change that. It's going to further change it, and perhaps from that perspective, Benoît and Sébastien can elaborate on what they see on the ground.
We are taking, if you wish, a reasonable assumption. If it goes more quickly, we will have, anyway, the tool. I always say when I speak to the people in charge, we have to build anyway the bank for 2030 and not for 2025 anyway, in what we are doing. Regarding the bigger picture for the group as a whole, we will stick when we will communicate for the three-year horizon financially.
I think it's good sometimes to look a little bit beyond when you think about strategic. I'm always very surprised that when I hear industrial companies, they think about 2030 and beyond, and that effectively, from a financial point of view, we are restricted to three years. Again, we will do the exercise for the financial projections for three years, beyond, for certain businesses, I think it's fine also to look a little bit beyond. Benoît wanted perhaps to react on the digital behaviors. No, Benoît?
No, I just wanted to mention the fact we have the two solutions. Boursorama and the networks is the best solution because whatever the speed of the change, we have the best position as a whole on the French market.
I think really we will be unique in that. I think in this industry, very few people in the industry have been able to build alternative models. Let's face it. You look at alternative models, usually you're looking outside. For me, Boursorama has been our internal startup. What we are doing basically is bring that model to maturity. 2025 is not the only leading online bank in France. It will be one of the major banks in France for individual clients. It will be very complementary with our new bank with networks. I don't think personally in 2025, whether or not we like it, that everybody will just go to online banking. There will be still people willing to meet with someone, with digital channels, in particular on the savings side.
You know my conviction that when people will go in a branch in 2025, when I say an individual client, not a corporate, it's a very different story here, and Boursorama does not cover that tier. When you talk about an individual client, my personal conviction, a lot, the core of the relationship will be centered on savings. Perhaps then, Sébastien, to your second question, Anke.
Yes. Regarding client evolution and to what we offer in terms of digital. As Frédéric said, usually French clients are a little bit less keen to digital usage than peers, but things are changing rapidly because of the sanitary crisis, and they might accelerate the usage of digital. In our case, what does it mean? First of all, during the IT migration, we will keep enriching our IT platform in terms of digital functionalities. Keep in mind that working on the IT migration doesn't mean we will stop our investment in terms of new functionalities, and enrichment of the IT system. We will do both at the same time. Second point, what do we want to do to increase the digitalization of the physical model, so to speak.
For individuals, we are already very well advanced, but we will continue to develop online sales and e-commerce with online-only purchasing for simple products and remote selling for more complex products. You mentioned in your question, Anke, peers. We should be very cautious in the comparisons with peers because sometimes our comparisons mix digital-only and remote selling, that stuff's different. We gave this morning in the presentation, the two figures, our objective in terms of digital-only products, 30% in 2025 with you all, and our objective in terms of remote selling for more complex products with the 80% for individual of products, which would be sold thanks to remote interaction and electronic signature. First objective for individuals, develop online sales and e-commerce. Second objective, enable remote interaction and regulate flows by channeling flows and customer requests. That's our project called SG2.
That's very, very important in terms of efficiency and client satisfaction. It's also very important because we want our teams and our staff to be focused on commercial objectives. Third point, we will pursue customer empowerment and usage of self-care usage on the day-to-day banking, on savings, and on administrative tasks. On the corporate market, again, we want to offer our clients a global vision of their own relationship with Société Générale, enrich the daily banking offer, accelerate dematerialization and self-care. Again, self-care is very key, and improve commercial efficiency with a better digital client journey in order to have more impact commercially and increase the cross-selling.
There was also, I think, a question on costs, if I'm not wrong.
Yeah. Question on costs, again, was on the timing.
Sorry, would you mind repeating your question, Anke, on costs?
Yeah, sorry, it was hidden in there. Yeah, in 2019, obviously the French retail banking cost base was more like EUR 5.6 billion with the combined entities making EUR 5 billion out of this. I was just wondering what happens to the other EUR 600 million starting base in 2019. Will that come down as well or should it remain flat? Thank you.
Well, again, I'm not sure to understand exactly what you say is the evolution. I think in the transition of the cost base for the two networks, as we've said, it will not be a linear projection. The idea is really to decrease the cost base, as we said, in 2025 versus 2019 by the amount that we just said. Perhaps happy also to comment further if you wish, on the bilateral basis situation.
Yeah. Thank you very much.
Next question.
Next question is from Mr. Guillaume Tiberghien from Exane. Please go ahead.
Thank you. Good morning, gentlemen. I have a clarification and two questions. The clarification is with regard to the Basel IV RWA. Does that include the flows or not? If it's not, I'm surprised it's such a big inflation of RWA. The two questions, one is high level. Is there any interest in the long run to, for example, say to all your mass-market clients in Société Générale, that the only way going forward is to actually migrate to Boursorama? Is it realistic in the 2025 to 2030, for example, long-term vision, or is it totally absurd?
The second question relates to your return on notional equity target. What's your RWA assumption? If you don't want to give a revenue target, which I don't understand why you don't, but if you don't want to give one, can you at least try to quantify for us the headwind to come on revenues from the rate situation if rates don't move from here? That's what we can assume.
Yes. Hello, Guillaume. I hope you're well. I will turn to William on your two questions on risk-weighted assets, both how we model, if you will, the impact of Basel IV, which is largely related to personal risk, and again, depends on the allocation we will do in due course, but more fundamentally. Depending on the way we see beyond 2025, the behaviors of clients. William, what can you say to Guillaume?
Hello, Guillaume. First of all, overall, with regards to Basel IV, we will make an update in the next quarter. There we have taken the latest assumptions we have. You're right to point out that there's an increase in capital allocated stemming from Basel IV, yet it is not including the output floor. As you know, output floor anyway for us as a whole is not that a big number, and it's not biting before 2028. We didn't want to have sort of a pro forma adjusted from something that may happen in 2028. There's a good EUR 1 billion uptick in the capital consumption. The main factor behind it is the fact that we assume the rebalancing of operational RWA pertaining to operational risk. As you know, between businesses, taking the assumption of an ILM equal to one.
Just, Guillaume, we have time to refine the allocation, but it's proportionate to revenues. The question is, how do you allocate that? To a certain extent, you get the business, it will stay. We tend to think at this stage, we will allocate according to this proportionality of revenues. In practice today, it would mean more capital for that than in the current situation. It's the way we think pro forma, if you wish, of Basel IV. Philippe, can we imagine Boursorama moving to 10 million clients in 2030? This is, I think, Guillaume's underlying question.
Yeah. Thank you for the question. I will elaborate on what has already been said by Frédéric, Sébastien, and Benoît. I think there is definitely the space for the two models. I think that it's very important to let the clients decide, because if suddenly you say to a client, you move to Boursorama, to our mass-market clients, they will not move. Because as of today, they still expect a dual experience, digital and human interaction. I think that we will have this capacity in the French market, which again, will be unique to propose the two approaches. I would like also to stress, as already said, that when you look at the future bank, the combination of Société Générale and Crédit du Nord, always keep in mind that 50% of the revenues are coming from corporates and professionals, which remain key priorities for us.
Regarding the remaining 50%, two-thirds of it are coming for the mass affluent clients. I mean that this model clearly dedicated on the long-term to this kind of clients. I'm sorry, I made a mistake. Two-thirds of the remaining 50% are related to mass affluents. Regarding the mass market, the priority for the new bank, the combination of Société Générale and Crédit du Nord, will be both to increase the fees with these clients and to reduce, adjust on an ongoing approach the cost to serve.
Thank you. Next question.
Sorry, Frédéric, you have not answered my question on the RWA growth you model and the revenue headwinds if rates don't move.
Listen, Guillaume, again, we've commented qualitatively. You will have a further erosion of margins will stay for some time on the deposit. Yeah. We keep assumptions of negative rates for the short term alongside the whole period. It will weigh on the erosion of margin on deposits. As we've said, now we also think about the development of fees from different elements, savings, including with the new partnership model and open structure we've put in place, some business model development with a new business model, as we've said, insurance. Again, we have put, I would say, overall conservative figures on the revenue side. On the risk-weighted assets, I think the bulk is really on the Basel IV, but there is a relatively lower increase with-
Yeah. Maybe if I can complement, try to think what is behind your question. As Frédéric said, in terms of rate assumption, I think we are pretty consistent. We don't see short-term rates crossing the negative, the zero line for the whole period, and for long-term rates, possibly towards the second half of 2022. These are fairly conservative assumptions, and actually well in check with forward rates. You're right to point out that then, apart from fees, which Sébastien has already commented upon, as well as Boursorama, we need to have some volume growth. Yes, there is some organic other volume growth over the period, consistent with some production on the credit side. Please remember that the weighting is not necessarily very high for individual clients, for example, related to the valuation. Yes, there is some fuel given to the business over the period.
Thank you. Next question.
Next question is from Madame Delphine Lee from JP Morgan. Madame, please go ahead.
Yes. Thank you for the presentation. I just have two quick clarifications, actually. The first one is on going back to Boursorama. If we look at your slide 32, if we were to understand a little bit the impact of client acquisition cost, just going back, without getting the exact numbers, is it mostly the customer rebates impact on the revenues as opposed to the marketing costs? Just to get a little bit of a feel of how they are split between revenues and costs at least for this year. My second question is just on the timing of the cost saving. From all that you've said around the data migration and the social constraints, so is it fair to assume that there's actually almost no impact in the next two years until 2023 included on cost saves in French retail from this merger?
Yeah. Delphine, hello. I will turn first to Benoît for the split, if I may, the qualitative aspect, the split between revenues and cost of the acquisition of clients, and then to Sébastien again on what we will do in the transition. Benoît.
Yes. The goal of this slide, the 32, was to show the underlying profitability of Boursorama because as we try to explain it, we are going to acquire around 560,000 clients this year. It's not a pace of acquisition, which is a little pace, even compared to all type of new banks, neobanks, other banks, and so on. There is a huge acquisition of clients this year, and as we said before, we do not amortize any client acquisition cost. It costs during the year we acquire clients. This slide explains the fact that on revenues, you have a part which are the customer rebates. We could say that it's the major part of the client acquisition cost. You have a part in the operating cost related to media, AdWords, and so on, and partnerships, related also to acquisition.
The goal is to show that with no acquisition, it's a theoretical view, you would have a profit of EUR 43 million during the nine first months of 2020. I think what is interesting is maybe more the fact that it's double than last year with the same kind of definition rather than the total figure. If you come back to the profitability in the coming years, it's still showing the fact that if we decide to reduce the acquisition, we will be profitable directly without any delay and with a variable client acquisition cost at 90%.
I think it's very important to have in mind also the global efficiency of Boursorama, because we talk a lot regarding client acquisition cost, but at the end of the day, it's a bank with 800 people internally, who are managing EUR 40 billion of outstandings in all the activity of the individual clients and with 2.5 million clients. I think it's very important to understand this part of the story, to have really in mind how we can be profitable.
Maybe I could add that, Boursorama has very strong foundations from an operating standpoint, compliance risk. It's also a strong momentum. In addition to that, what has been demonstrated in 2020, as mentioned by Benoît, is really the flexibility, the agility of the model. Yes, during the second quarter until the third quarter, we were at the breakeven. It demonstrates all the potential. We want to capture this momentum because we think that the coming two years are critical and it's a kind of magic moment. We want to build this client base, and after, to fully leverage on it. That's why we are meeting today for this net income for Boursorama in 2024, 2025.
Thank you, Sébastien.
Yes. Thank you very much, Delphine. Regarding your question on costs, let me start by saying that this is a very ambitious project. We are not talking about only one bank when we describe Crédit du Nord. We are talking about nine different banks within Crédit du Nord. We have a project where we will have legal mergers, taking into account the fact that we have nine legal entities, nine different banks to be merged with Société Générale. I will not repeat what I said about social constraints, social French law, which is more stringent than in other countries.
Regarding IT migration, as Bruno said, its timetable totally consistent with precedents and market practice. Having said that, we will get 80% of the net savings in 2024. I will repeat what I said, we are working very hard to have quicker timetable. Obviously quicker timetables would mean a quicker timing as far as the synergies are concerned.
Thank you. Next question.
Next question is from Mr. Matthew Clark from Mediobanca . Sir, go ahead.
Good morning. Some more questions on costs, please. Firstly, a clarification. Could you just clarify whether the out a year cost reduction guidance assumes the fallout of the Single Resolution Fund contribution that's attributable to the retail division? Secondly, could you give us some idea of what you think the normal cost inflation for the French retail business is if you were to do nothing? Thirdly, could you just clarify, is this effectively it on cost measures until 2025? Once you've negotiated this with the unions, do you therefore have no more scope to implement any further measures until this project is complete? Usually, you seem to do things every two, three years, have a new plan for retail costs, but this would obviously be a longer period for a single project. Thanks.
Hello, Matthew. William will answer on whether or not the decrease or the disappearance of the Single Resolution Fund is included, knowing that the amount is relatively minimal. Can you answer that part of the question, perhaps?
Yes. In 2019, for French retail, the SRF contribution was about EUR 70, so it went up 25% across the other business in 2020. You can assume that we take the assumption that there is no more SRF contribution in 2024.
Thanks.
That's included, in practice, that disappearance of the EUR 70-.
It is included in the calculation.
Effectively in the calculation of the net decrease that is given, huh?
Yeah, absolutely. We have the order of magnitude.
Second, I think we need to elaborate a little bit on what we can do, again, socially, Matthew, because once we are embarked in this project, we cannot easily add first additional things which could be seen by trade unions as an anticipation of the project. There are, if you wish, constraints during the implementation of the project. How long will it take? The project itself will be actually completed socially, in practice, around 2024. The bulk will be completed in practice. We will be, I think, able to potentially resume an additional thing. I think, if you wish, it's a little bit premature to anticipate what it could be, based on what already we have in mind, with the significant adjustment of our organization, business model, reduction of networks.
Listen, there will be also a story beyond, probably, but I think it's a little bit difficult to anticipate. Personally, it seems to me that what we are going to be able to deliver here is a profitability in practice when you add the two components. That very few players will be able to achieve in practice in the Eurozone, retail, and certainly at least in France. I think, again, at this stage, we stick there and we'll see how it goes.
As we've said, we may be able to anticipate the time frame. We don't factor that, let's be realistic, if we can, we will do. At this stage, at least, we think it's a pretty ambitious and attractive roadmap for Eurozone banking retail activity, which, as we all know, will face the challenge of the current environment, including on the rates. Did we answer your question, Matthew? Or was there something else?
The only other one was on the normal cost inflation you would expect.
Oh, good. Yes.
if you did nothing.
Listen, if we did really nothing, not moving the staff, et cetera, when you have the fixed cost, the salary, which might be around 1.5% traditionally in the French labor market. If we were to do nothing, and the bulk of that, of the cost, the majority of the cost is staff. I would say 1.5%, and then on the rest, investment in IT, well, it could be flattish to 1% increase, but I don't know how to answer your question, to be frank, on the other expenditure. We might have next year, let's just take into account that we have not traveled at all, basically this year, so you might have some increase or back to normal next year on just traveling a little bit, things like this, but it's a little bit complex. I would say take 1.5% if we were to do nothing perhaps.
Okay. Thank you very much.
Next question.
Next question is from Mr. Andrew Lowe from Berenberg. Please go ahead.
Hi, thanks very much. My question just follows on from what you said about the revenue dissynergies from the merger being relatively limited. I just wondered, if this is the case, what's prevented you from doing this merger earlier, i.e., why do it now and not three years ago? Thanks.
Is this all, Andrew?
Yeah. No, that's all.
Okay. You have one question. Listen, first, I will give Philippe Aymerich, who was before taking over the full retail, has been the chairman and CEO of Crédit du Nord. We can elaborate on what we achieved in the last five years and why. In a different world, and let's face it, also, I think we can all admit that this crisis is not an insignificant event, and it will effectively further trigger changes in client behavior on digital and further consolidate the low rate environment and the more difficult environment. Philippe, please answer that question.
I think that the key part of the answer, it's really the worsening of the situation and the acceleration of many trends by the pandemic, and not only economic trends, but usage of digital behaviors of the clients. The second point is that I do believe that we have not wasted the last three years because, as you know, and as it was explained this morning, we have worked a lot, both on Société Générale and in Crédit du Nord. We have continued to increase the cost synergies between the two entities, notably regarding IT. I think that all this work is going to help us a lot for the additional steps.
Basically, the additional steps are described by Sébastien, we will completely mutualize the IT platform and therefore operations. Two, we will have cost synergies related to the mutualization of the networks of the branches without leaving territories. The third component is the merger of the head offices. I think that what we have done, again, during the last four, three years are really useful for the additional steps we are doing today.
If I may, I just at my level, add two things. First, there was potentially a consolidation operation which could have been considered for Crédit du Nord that we did not decide to pursue. The second thing, I think that we did the maximum that we could in adapting the networks as we did, and that we were in a market where most of the players do not adapt the networks, did a lot in the last five years. I think really pursuing that strategy we would have been in a deadlock for Crédit du Nord. Let's face it, reducing further the network would have meant an issue. I think that it's really the right time now to do something different because of the environment, as we said, but beyond, because pursuing what we had done very efficiently in the last five years would not have functioned.
When you add all the pieces, I think it is now the right time, and I think the job which has been done, which is remarkable, I would like to insist, because it's not a top-down decision, it's also a work built with the teams and based on our decision to consider that option makes a lot of sense currently. Next question.
Thank you.
Next question is from Mr. Jacques-Henri Gaulard from Kepler Cheuvreux. Please go ahead.
Yes. Good morning, gentlemen. Two questions. The first one on Boursorama, the expected cumulative losses between 2021 and 2023 of EUR 230 million. I think it is a delta over your own budgeted losses. If we can just have a view of how much extra losses that represents, just for modeling purposes. Then the second question, I guess, again, a little bit top-down. The cost savings are backended to the 2024, 2025. There are going to be restructuring costs in 2021, so you can always imagine people panicking and say, oh, that's it.
We're going to have another couple of years of transitions for Société Générale. In a way, when I look at what you've announced as well, it seems that irrespective of revenue guidance, the P&L is going to be carried by your EUR 450 million cost savings in the investment bank in 2023 before that particular cost savings is taking over. Is it the right way to look at your long-term financial projection? Thank you.
Hello, Jacques-Henri. I hope you're well. Let me perhaps answer your second question, and then we will go back to Boursorama. First, let me reiterate that in terms of dividend policy, how we calculate the dividend on underlying net profit, and we will not take into account this CTA. If you wish, yes, of course, in terms of P&L, it will impact. I think for the investor and given the kind of payback, and again, I hope people understand the need to further transform the French retail networks, given the environment, and the risk of waiting would be enormous. Here we have, I think, a real opportunity first to drive, to conduct an internal consolidation, domestic consolidation, to be frank, and it's exactly what people do elsewhere.
We have the only opportunity in France, let's face it, at least the internal one, and with benchmarks which are very similar. As we've said, we've taken into account the time frame, which has to factor at this stage the constraints of the French social environment, if we can anticipate with that. We have CTA costs, which are exactly in line with what we've seen outside, including what we've said, IT investments, training, and IT system amortization costs. I think really we are in line with anything that I've seen outside. We work, of course, on other businesses, projects. Let me just say, capital markets, yes, certainly. We will update you on that after the fourth quarter results, with the new head of this activity.
I would like also to insist that in terms of being able to reduce our cost base, we have also still cost of remediations. 2021 is an important year for you where it's the end of the legal procedures and settlements. We are working a lot on that. Of course, we put that behind us, and which will help also to reduce the cost that we have, and which are, for some of them, allocated in the businesses or in the corporate center anyway, beyond 2020 onwards.
Yes, we will have these costs still to carry, but as I've said, in terms of dividend policy, we neutralize, and I think we have, of course, the capacity to finance and for the benefit of the long-term profitability, which will be definitely much above, I think, what we can deliver today and sometimes expected by certain market participants. I think it really makes sense. In terms of Boursorama, can you elaborate, Benoît?
Yes. Thank you, Frédéric. Thank you for your question. It is the EUR 230 million during the period of 2021 to 2023. It is the cumulative losses we are going to implement in order to reach more than 4 million clients by the end of 2023. The level of losses will be more important than what we did previously. Why? We are going to acquire globally the same number of clients, the same volume, but in three years, compared to five years in the previous period.
If we take into account the previous period, we have five years to get 2 million clients acquired, and it would be roughly the same for the period of 2021 to 2023. It's really the idea to invest now in order to get the clients as soon as possible, which is the best manner to have the revenues as soon as possible also. It's a question of market share, competition, and capability to make revenues.
Okay. Very clear. Thank you.
Yeah, Philippe, you want to add something, Philippe Aymerich?
Why timing is so critical, it's because Boursorama has this unique asset that it has a simple but comprehensive range of products. That's very important. Boursorama is not only an account, a card, and an app, it's also full services regarding savings, financial services, credit, insurance. These products, actually, we have demonstrated that we are selling them to our clients.
This year has confirmed the validity of the business model. Let's face it. Of course, it was a very specific year, but it has confirmed the validity of the model. Next question.
Next question from Madame Flora Bocahut from Jefferies.
Yes, good morning, thank you from myself as well for the presentation today. The first question I wanted to ask you is, given that you had kind of pre-announced this project of merger in September, I wanted to see if you could share maybe some client commentary that you received in the past two months. I'm thinking here especially about the mid-size corporate clients that you have at Crédit du Nord, whether they have been supportive of the project, or you feel it's not been very well received. What kind of client attrition commentary you can derive from, I guess, the discussions you've had with corporate clients over the past two months at Crédit du Nord.t
The second question, if I look at the deep dive that you did on French Retail back in May 2019, I think back then you had plans for a phase of client acquisition at Boursorama until 2021, with the target to have more than 3 million clients in 2021. Then you were talking about phase II of improved profitability. Now, obviously, we get a similar message, but just a different timing, where you now target this client acquisition phase to be longer than previously expected, toward more than 4 million in 2023.
The question I want to ask today is, why the two year delay, the two year change in the timing of the phases? Isn't there a risk that in two years' time you could push further this profitability phase because you continue to see good client acquisition? The reason why I'm asking is because when I looked at the slide 34, where you show us the swing in profitability for Boursorama, it seems it's going to be the bulk of the RONE improvement towards 2025. Thank you.
Hello, Flora. Good morning. I will turn to first Sébastien and then to Benoît. Sébastien first.
Yes, Flora, thank you very much for your question. As you said, last September, we announced the study and the launch of the study. We didn't describe the model. We are describing the model now, our objectives, and how we'll achieve a higher degree of term satisfaction. That's today. During the period of time of the study, we got a first very limited client feedback, and the client feedback from Crédit du Nord, and especially SMEs clients, explained to us what would be the model, and will it be different from the Crédit du Nord model as it is today. That's what we will do starting now, because today we do describe the model.
This model will still be based on proximity, which is one of the key values of Crédit du Nord's model, and value which is very important, as we said, for SMEs. We are very confident because all the choices made so far respect Crédit du Nord's strengths, and this proximity reactivity will be first kept, and second point, enlarged to a broader client base of 10 million clients.
Thank you. Benoît?
Yes, thank you for your question. I think that you're right. Last year, the target was to reach 3 million clients in 2021. The decision has been made to accelerate and to grow faster. Why? Because we are totally convinced in the fact that we are generating more and more net results with more clients. It's as simple as that. We think that the depth of the volume of clients we can acquire is higher than what we expected one year and how to go.
I think the goal is really to have a better RONE and to maximize also the volume of net result and profit we can do in 2025. The most clients we get, the most result we get. It's why we have changed the target, and we have said that now it's more 4 million clients by 2023. It will be more than EUR 4 million compared to EUR 3 million in 2021.
If I may, Flora, again, I think that the bank with 4.5 million clients, I guess a brand awareness which might be second to none. It's already, again, when you look at the brand awareness of Boursorama, it's very strong. It appears in the top three, top four, will be even different in terms of client acquisition. I think that first, even if you take a rhythm of 3%, 4% multiplied by 4.5 million, that leads to close to 200,000. By nature, the bank will be very different, and we can go to something very different in terms of client acquisition, I think. Benefiting fully from a construction which might have taken a few years, but which will be unique in my view, even in the Eurozone. I don't have in mind something, at least very few will be similar, and certainly nothing in France.
It will be a way, compared with all your questions on the client evolutions, blah, blah. I think to be able to have all the tools, to be ready to anticipate and answer evolutions that we might not be able to predict today, but which might happen, but at least we'll have the dual model, which will make sense potentially for all the client needs. Next question.
Next question from Madame Lorraine Quoirez from UBS. Madame, please go ahead.
Hi. Hello. Sorry, another very quick one from me. Could you please tell us what the tax rate you assume in 2023, 2024 for your calculation of return on normalized equity, please? Thank you.
For Boursorama , 25%, no?
Tax rate, I think.
For the whole, we haven't made any guidance for 2024. Overall, as we said, there's no reason that would derive from what we have set for group level, which is around 24%.
Yeah. For France anyway, there's a tax rate which is going down according to plan. This government has not changed that. We have taken this progressive reduction of corporate tax.
Thank you.
Any other questions, please? Next question.
We have one last question from Mr. Pierre Cazenave from CIC. Pierre, please go ahead.
Hello, good morning. Just want to have some clarification regarding the project in the concrete aspect. You have given the example of two branches in Avenue des Ternes, which is, I would say, the simplest example in terms of rationalization.
I could have taken Rue de Rennes. I could have taken Rue de Rennes, Pierre.
I live in Avenue des Ternes.
Rue de Rennes, I can tell you it's the same.
I know.
Sorry.
I know the fact, but this is not my point.
Yeah.
I know very well your regional network because I have been the auditor, as you know, during several years. I know something is that clients are very attached to the name of the bank, Société Marseillaise de Crédit, et cetera. As far as I understand, you are going to make a legal merger, it's not very clear regarding the maintain or not of the name of the company. My point is, I am in Marseille, and I have Rue de Paradis, a branch.
Yeah.
You have a branch of Société Générale, Rue de Paradis, and you have, of course, a big branch of Société Marseillaise de Crédit. You legally merge. At the end of the day, if I'm a client of Société Marseillaise de Crédit, if I have only one branch, what would it be? It would be a SG branch, it would be a Société Marseillaise de Crédit branch.
Yeah.
A SG Marseille branch? You see what I mean?
Yes.
The corollary of my question is, out of the 600 branches you are going to close, which part will be in real Provence, I would say, and which part will be in the major axis of SG network, Lille, Paris, Bordeaux, Lyon, Marseille East, Bordeaux, eventually. You see what I mean?
Yes, Pierre. Yeah, please. Yeah.
My last question is regarding the breakdown of restructuring costs, which are quite significant, I would say. You mentioned a lot IT, but what would be IT part of this restructuring cost, and what would be people part of this restructuring cost? Thank you.
Pierre, I will let Sébastien to elaborate on, again, to come back to the brand and your question on brand. We don't disclose the breakdown. There are also social elements behind that. As I said, on the pure social thing, nothing very dissimilar to what you did previously. Again, we need to have first conversation with the trade unions on that situation. That's why we can't, at this stage, give more granularity. Now, Sébastien, Rue Paradis.
Yes, Pierre. No mistake. Having one single legal entity doesn't mean having only one branch in the French market. Okay? Our objective is very clear. As I said, regions are different. Brand strategy should be different depending on the regions. In the South of France won't be the same brand than in the North of France or in the East of France, because we are talking about different client expectations in different regions. We have to keep working on the brand strategy, but I summarized earlier today the main principles and commitments. It will not be only one single branch on the entire territory. Regions will be treated differently by using the first part of the brands, which will be associated with Société Générale, whatever the final decision within Société Générale's universe. The second part of the brand will be regionalized.
You mentioned Société Marseillaise de Crédit. Société Marseillaise de Crédit is a strong brand. We are analyzing the different brands of Crédit du Nord in order to take into account clients' perception of the brand. We want to make no mistake, because at the end of the day, the brand strategy is very important to demonstrate fidelity vis-à-vis the history of all these brands, but also be able to have a brand strategy, perfectly consistent with the different factors, which should be taken into account, such as, example, the fact that this brand strategy needs to be very efficient when we talk about digital.
I think to answer your question on the branches, I would like to insist. It's a little bit difficult to answer your question because what we could have been doing going forward if we had kept the two networks separate, is to cut maybe two branches in Hazebrouck, because they might have been not the right scale at the end of the day, and keep maybe the two branches with Rennes. The whole purpose is to say, at the end of the day, we'll keep one branch in Hazebrouck, whether it's Rue Nationale or Place General de Gaulle, I don't know.
The idea is one brand there with scale, the mass benefit, and then maybe close one of the branches with Rennes, whether it's the one close to Montparnasse or Rue Notre-Dame des Champs. I think really, and it was reflected in Sébastien's workshop with all the people, it is something which is working very well. Sébastien?
Yes. Keep in mind, Pierre, that as we said, 60% of Crédit du Nord and Société Générale branches are close to each other from less than one kilometer. This percentage, 60%, is true, in all regions. In some regions, it's higher. In other regions, it's at least 60%. We have this flexibility to optimize the network without leaving cities. That's something very different compared to what we did over the last years when Société Générale decided to cut branches in some cities and Crédit du Nord did the same in the same cities. At the end, both brands left the cities. These kind of things won't happen again.
Again, a last part of comment regarding this topic is that we are also working a lot on the format of the branches, which means that we will probably have less small branches, and with branches with the capacity to deliver the expertise, the right level of advice to the clients. That is also an important component to take into account, because yes, the clients are coming less and less to the branches, but when they come to the branches, they want a great experience from an advisory standpoint.
Thank you. I think there is no more question.
Yes, there is no more question, sir.
Okay, well, we are perfectly on time. Thank you very much for your participation, and have a very nice day, and keep safe, of course, in this still uncertain environment. Thank you. Bye-bye.
Ladies and gentlemen, this concludes the conference call. Thank you all for your participation. You may now disconnect.