€126bn invested in the economy
The low interest rate environment has led us to step up the diversification of our investments and increase our focus on financing the French economy.
Each year, the equivalent of our total new money – around €20 billion – is invested in the financial markets. The challenge consists of optimising the return on these investments while efficiently managing the related risk. Historically, CNP Assurances, like all other insurers, invested 50% of its portfolio in government bonds. In 2014, however, with interest rates falling to below 1%, this was no longer a viable option. We therefore scaled back our government bond portfolio over the year, setting a minimum of around €2 billion, and started investing in corporate bonds.
A key partner of large companies
The bulk of our asset portfolio still consists of fixed income assets – debt securities and loans – but is now increasingly focused on corporates and financial institutions, with investments of around €7.5 billion and €5 billion respectively in 2014. At the same time, rising stock markets led us to invest in equities throughout the year, for a total of €2 billion.
Focus on SMEs and mid-market companies
The portfolio diversification process has brought us even closer to the community of SMEs and mid-market companies. For example, we participated in private placements by mid-caps such as Seb, Vilmorin, Lactalis, Zodiac, Sonepar and Adéo.
We also partner unlisted companies, as one of the leading investors in the private equity market in France with €3.5 billion committed at 31 December 2014, including €1.6 billion of investments (based on their net carrying amount). In all, we invested €740 million in new projects in 2014.
In 2013, 24 institutional investors committed to injecting €1 billion in the new Novo corporate debt funds launched by Caisse des Dépôts to provide financing for SMEs and mid-market companies. A first wave of loans, totalling €461 million, was granted to sixteen companies operating in the manufacturing and service sectors. CNP Assurances’s contribution amounted to €57 million, out of a total commitment of €100 million.
Major real estate and infrastructure projects
In 2014, we invested some €1.4 billion in this asset class, allowing us to diversify our portfolio while optimising the yield/risk trade-off. At end-2014, we held a property portfolio with a net book value of €6.6 billion, along with €772 million worth of investments in infrastructure projects in France, in such areas as rail transport, renewable energies and information networks.
Contributing to a sustainable economy
Convinced that environmental, social and governance factors contribute to improving the yield/risk ratio over the long term, for many years we have been pursuing a responsible investing strategy. Our commitment in this area has been strengthened by our pledge to uphold the United Nations’ Principles for Responsible Investment (PRI). This is illustrated by our broad use of ESG screens, which were applied to some 80% of the assets in the portfolio at 31 December 2014.We also promote socially responsible investing in the 18 million letters sent each year to policyholders, and work with our partners to encourage savers to choose SRI funds. As of 31 December 2014, some 100,000 unit-linked contracts included SRI funds, 13% more than at the previous year-end.
With €47.5 billion invested in large French companies (equity and debt), CNP Assurances is a strategic partner in their domestic and international growth.
€560m invested in the green economy (renewable energies, clean tech, green bonds, etc.)
€1.6bn* invested in private equity funds
€6.6bn* invested in property in France
* Net carrying amounts at end-2014, consolidated scope, France