CNP Assurances : Conclusion of a non-binding Memorandum of Understanding with Caixa Seguridade

Paris, le 29 septembre 2017

CNP Assurances announces the conclusion of a non-binding Memorandum of Understanding (MOU) with Caixa Seguridade, establishing the conditions for a new exclusive distribution agreement in Brazil as of 1 January 2018.

The conclusion of this new agreement, which depends on future negotiations and its approval in particular by the Board of Directors of CNP Assurances, would enable CNP Assurances, subject to the payment of a price, to distribute exclusively in Brazil in the Caixa Econômica Federal network until 13 February 2041, on a new scope. When concluding a definitive agreement, if any, CNP Assurances would therefore waive, as of 1 January 2018, the current exclusive distribution rights of its subsidiary, Caixa Seguros, under the existing partnership.

The new scope of exclusivity would only cover life and consumer credit life insurance lines and private pension plans (vida, prestamista, previdência). The new distribution agreement will be operated through a new corporate structure to be created by CNP Assurances and Caixa Seguridade, in which the economic rights of CNP Assurances would be reduced compared to the current situation.

This new agreement would enable CNP Assurances to secure an important portion of its business in the Caixa Econômica Federal network for the very long term (23 years). As an illustration, on a pro forma basis, the share of premium income economically kept by CNP Assurances in 2016 would have accounted for approximately 60% of the premium income generated in Brazil. Similarly, the new-business margin of the new scope was comparable to the average new-business margin of CNP Assurances in Brazil in 2016.

CNP Assurances welcomes the conclusion of this non-binding MOU by which the Group would continue to be Caixa Econômica Federal's main life insurance partner in Brazil until 2041, while allowing CNP Assurances to continue to expand its other activities in Latin America.

As a reminder, CNP Assurances has set an objective of delivering average annual organic EBIT growth of at least 5% over the 2017-2018 period compared to 2016. Strengthened by the strong results recorded in the first half of 2017, CNP Assurances aims to achieve organic growth of EBIT significantly above 5% in 2017 compared to 2016. Given the prospect of this new agreement and the ongoing negotiations, CNP Assurances is not in a position, at this stage, to set an objective of EBIT growth in 2018.