Prsentation PowerPoint

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 Rendez-vous  RCI Banque 9th April 2008
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• Philippe Gamba
• RCI Banque Renault Commitment 2009.
• Antoine Rousselin
• Results.
• Basel II.
• Jean-Marc Saugier
• Liquidity funding plan 2008.

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100 owned subsidiary of Renault, RCI Banque is
an autonomous Business Unit, specialized in the
automobile financing and the distribution of
associated services
French bank under supervision of the French
Commission Bancaire since 1991.

• Core business leverage of conquest and
  loyalty
• Profitability add-on for the manufacturers and
  their dealer network.
• 2 main objectives
• Optimization of ROE.
• Integration to Renault Group brands and Nissans
  marketing strategy.
• 93 of the outstanding in 10 Western Europe
  countries.
• 3 markets
• Retail.
• Enterprises.
• Dealers.
• Unique distribution channel the dealer network.

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Retail activity accounts for 50 of the
outstanding
Distribution of RCI Banque activity as of
December 31st, 2007
Total of average performing loan outstandings
22.9 Bn
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RCI Banque within Group Renault
RENAULT sas
100
100
AUTOMOBILE DIVISION

• RCI Banque contributes directly to Renault
  consolidated operational margin.
• 2007 Contribution 472 M or 1.16 of Groups
  revenue (income before tax 461M).

• RCI Banque finances brands of the Renault Group
  worldwide and Nissan mainly in Europe.
• (34 countries / Renault 18 countries / Nissan).

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Captives Competition environment Evolutions
Integration within the brands
BMW FS
RCI Renault
NMAC
GMAC USA
DC FS
Ford credit
BPSA Finance
Ford USA
VW Bank
Toyota
Toyota USA
Fiat Fidis
RCI Nissan
GMAC Europe
Auto Financing NV UV
Services Insurances
LTR Full Service Mono to Multi-brand
Financing excl. auto (cards, mortgages)
Offers depth (products/services, multi brand)
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Our Business Model  Synergies between captive
and carmaker

• Trusted brand
• Access to dealer channel
• Exclusive marketing programs

Dealer Network
Proposes financings associated services
Proposes competitive offer of vehicles
Car Manufacturer
Captive Finance

• Marketing  One Stop Shopping 
• Conquest
• Upper range
• Optimized negotiation price
• Protection of Residual Values
• Customer satisfaction
• Loyalty Renewal acceleration
• Contribution to results (Manufacturer and
  dealers)

 Value creation  for the consumer, the dealer
and the manufacturer
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RCI Banque and Renault commitment 2009

• Growth
• Carry on asset growth by acceleration outside
  Europe (more than 20 of volumes and 10 of
  outstanding in 2009).
• Profitability
• Reach 548 M operating margin contribution to
  the Renault Group in 2009.
• Quality
• RCI Banque to reach the Finance Companies Top
  3 for the dealer network.

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RCI Banque and Renault commitment 2009 Growth
1) Carry on  Profitable  asset growth in Europe
(G10)
31/12/2007

• Increase volumes on Renault, Dacia and Nissan
  brands.
• Maintain intervention rate at a  high  level gt
  33.
• Continue Services integration.
•  Specific products policy by country, by type
  (maturity, financed amount).
• Develop the used car financings strategy.

Target 2009 22.5 bn ( 2007) 21.5 bn

• 2) Develop outstandings outside Europe
• in 2000 114 m
• in 2007 1 620 m
• Target 2009 2 500 m (10 of the outstandings)

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Steps of international development and countries
priorities
JV, JV or 100 RCI Banque according to
feasibility study
SECOND PHASE

• Centralized funding if the country transfer and
  convertibility risk rating is A- or better.
• Provisioning of country risk exposure
  (total provision 26m at
  end 2007)

Steps of international development
Usually commercial agreement with local bank
INITIAL PHASE
Under exclusive RCI Banque responsibility
FEASIBILITY
OPPORTUNITIES
Markets for Renault and Nissan exceeding 15 000
vehicles / year

• Main  growth leverage  outside Europe (G10) in
  2008 and 2009
• - Brazil, Argentina,
• - Russia, Ukraine (CA until 2009 and
  then a JV as of 2010),
• - Scandinavia and Central Europe,
• - South Korea,
• - Feasibility studies Turkey, India

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International development by supporting Renault
RCI Banque and Renault commitment 2009 Growth

• Subsidiaries, Branch or JV
• Commercial Agreement
• Participation

EUROPE

• Netherland
• Poland
• Portugal
• Czech republic
• Scandinavia
• Slovakia
• Switzerland
• Slovenia
• Baltic countries

• Germany
• Austria
• Belgium/Luxembourg
• Croatia
• Spain
• UK
• Hungary
• Italy

FRANCE

• EUROMED
• Morroco
• Roumania
• Russia
• Algeria
• Ukraine

ASIA - AFRICA South Korea

• AMERICA
• Argentina
• Brazil
• Mexico
• Colombia

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RCI Banque and Renault commitment 2009
Profitability
RCI Banque demonstrates the low volatility of its
results and profitability over 15 years
Outstandings at end in m
Dec 99 Nissan Financial captive take over
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• Philippe Gamba
• RCI Banque Renault Commitment 2009.
• Antoine Rousselin
• Results.
• Basel II.
• Jean-Marc Saugier
• Liquidity funding plan 2008.

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Stability of the gross financial margin and
Pre-tax income, as of average outstanding

• Despite interest rate rise, the gross financial
  margin has been maintained.
• Cost of risk is kept inside target (0.5-0.7).
• Operating expenses repurchase of 50 in
  previous UK JV has a non recurring negative
  impact on operating costs in 2007.

NRE non recurring elements In m
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No impact of the liquidity crisis on profitability

• Customer financing (1.8 to 2 years WAL)
• Pricing is based on cost margin approach to
  achieve ROE target
• Increased credit margins are compensated by the
  drop in interest rates.
• The banking environment has allowed for
  significant price increases in the last six
  months, without significant impact on new
  business.
• Floor plan financing
• Dealer financing is generally indexed on Euribor
  3 months.
• Short term cost of funds have remained stable
  (over Euribor) even if margins over EONIA have
  widened.

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Cost of Customer and Dealer Risk
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Stable non performing loans ratio, and
conservative provisioning policy
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8 Tier 1 target
In m
8 Tier 1 target drives dividend policy.
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Basel II

• Authorization by the Commission Bancaire to use
  the Basel II advanced internal models for credit
  risk as from January 1st, 2008
• for 4 countries France, Germany, Spain et
  Italy representing 70 of the outstandings,
• to be extended to UK in 2009.

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Basel II Roll out plan 2008
This table shows the mapping of advanced models
SME small and medium enterprise PD probability
of default
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Basel II Roll out plan 2008

• The effectiveness of the models (upholding of
  risk class prioritization over time) and the
  quality of the forecasts of the PD level per
  class are subject to detailed quarterly
  backtesting, as illustrated by the graphs
  hereafter.

PD probability of default
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Basel II Roll out plan 2008
LGD (Loss Given default) and BestEL (Best
expected loss)

• Economic losses are estimated from discounted
  recovery cash flows, on the basis of historical
  data covering the last 10 years.

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• Philippe Gamba
• RCI Banque Renault Commitment 2009.
• Antoine Rousselin
• Results.
• Basel II.
• Jean-Marc Saugier
• Liquidity funding plan 2008.

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A prime auto loans portfolio and a strong
liquidity position

• A strong liquidity position
• 3,1 bn liquidity reserve at 2007 end
• 5 361m Committed back-up lines.
• 592m Cash.
• 1 825m ECB eligible collateral.
• - 4 701m CD/ECP outstanding.
• Funding of assets with longer dated liabilities.
• No drawing on committed credit lines
• (Back-Up).
• ABS programs with long WAL, no repayments due in
  2008 and a potential increase in ECB eligible
  outstanding (retained ABS notes) in case of
  portfolio growth.

• A Car Finance activity with no link with subprime
  activity
• No activity in the US.
• Cost of risk under control, resulting from stable
  origination, underwriting and collection
  processes.
• 93 of assets in 10 western European countries
  (mainly France, Germany, UK, Spain and Italy).
• No off-balance sheet exposure to any credit risk.

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A cautious financial policy

• While maintaining permanent liquidity reserve
  coming from
• Assets being funded with longer dated
  liabilities.
• Committed lines (undrawn).
• ECB eligible securities.
• Cash invested in short term bank deposits only.

• Aiming to protect the commercial margin
• No exposure (direct or indirect) to any subprime
  assets, no activity in the US.
• Market risk kept at low level.
• 25 Risk division ratio applying to all banks
  prevents RCI Banque from lending more than 25
  of its equity to a single name (including
  Renault).
• Diversified sources of funding.
• Centralized funding only in  single A  rated
  countries.

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A conservative liquidity risk management
Liquidity Position of RCI Banque as of DECEMBER
31st 2007 (in M)

• Assets are funded with longer dated liabilities.
• A recognized know-how in ABS.
• Sufficient potential portfolios to be securitized
  in order to deal with a major liquidity stress
  scenario (no access to unsecured funding during
  12 months).
• Access to ECB liquidity in case ABS market dries
  out.

assets
liabilities off B/S
liabilities
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Liquidity Reserve remains high

• Available Liquidity made of
• bilateral committed and available lines
• allocated by 35 international banks from 12
  countries.
• No covenant no negative pledge, ownership, pari
  passu, cross default, material adverse change,
  rating triggers.
• Asset Backed Notes eligible to ECB tenders.
• Cash.
• Liquidity Reserve Available Liquidity CD/CP
  Outstanding

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Limited market risks

• Interest rate risk
• Low sensitivity exposure, daily control at group
  level (1.23m impact for a 100 bp variation on
  December 31st 2007).
• Foreign exchange risk
• Low foreign exchange exposure due to funding in
  local currency (FX exposure on 31/12/07 2,3 M).
• Counterparty risk
• 99 of exposure (mainly on derivatives) with
  counterparties rated  single A  or above.

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Securitization is used both for funding and
increasing asset liquidity.
ABS fully consolidated, first losses are kept by
RCI Banque.
SPV
Issuer
Assets Portfolio (no cherry picking all
receivable meeting eligibility critera are sold)
Medium Term Senior Notes AAA Medium Term
Subordinated Notes A Short Term revolving
Notes AAA Short Term Subordinated
Notes A Credit enhancement
Assets
Sale of receivables
Market
Underwriting (only through dealership)
Private Placement Monthly re-issue to match
portfolio fluctuation
Purchase price
RCI Banque
Generaly kept by RCI Banque as ECB collateral
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A balanced funding profile split between
different sources and maturities

• Stand alone funding (without any Renault
  support).
• 4 ABS programs have been launched since 2002
  leading to an increase of long term liabilities.

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A balanced geographical funding diversification
Borrowings with initial maturity of one year and
above

• 2005 5 636 m (wal 3.4 years)
• 2006 5 103 m (wal 3.3 years)
• 2007 3 679 m (wal 2.8 years)

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2008 funding plan (1yr and above)

• 2008 expected asset growth 400 to 800 M (2 to
  4).
• Final mix will depend on relative costs

() including local lines and Schuldscheine
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RCI Banques strengths

• No exposure on US economy, no exposure on
  subprime,
• No  mark to market  financial assets
  depreciation.

Stable Outlook of all RCI Banques ratings

• A Long Term rating of one notch above Renaults,
  mainly because of

• A mono-activity business model.
• We do not expect any departure from this
  prudent and primarily profit-oriented strategy
  SP analysis 27/07/2007.
• A strong stability in results and a limited cost
  of risk.
• RCI Banques overall margins are high and
  reflect its car financing activities Moodys
  analysis 20/11/2007.
• A strong liquidity profile resulting from
  cautious financial policy
• Moodys views RCI Banques liquidity as strong
  and sufficient to withstand a period of stress
  without significantly affecting the banks
  activities Moodys analysis 20/11/2007.

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www.rcibanque.com
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Disclaimer

• This presentation is not, and is not intended to
  be, an offer to sell any security or the
  solicitation of an offer to purchase any
  security.
• The following presentation has been prepared to
  provide information about RCI Banque Information
  have been obtained from sources believed to be
  reliable. None warrant its completeness or
  accuracy.
• This presentation may contain forward-looking
  statements, in particular statements regarding
  our plans, strategies, prospects and expectations
  regarding our business. You should be aware that
  these statements and any other forward-looking
  statements, in this presentation, only reflect
  our expectation and are not guarantees of
  performance near and in the future.
• These statements involve risks, uncertainties and
  assumptions about events or conditions and is
  indented only to illustrate hypothetical results
  under those assumptions. Actual events or
  conditions are unlikely to be consistent with,
  and may differ materially from, those assumed. In
  addition not all relevant events or conditions
  may have been considered in developing such
  assumptions. Accordingly, actual results will
  vary and the variations may be material.
  Prospective investors should understand such
  assumption and evaluate whether they are
  appropriate for their purposes.