“We are going to fundamentally transform our banking model” (Philippe Heim, Banque Postale)

THE TRIBUNE. La Banque Postale is today unveiling its raison d'être. How to sum it up?

PHILIPPE HEIM - We have chosen to write a detailed purpose, which reflects our strategic plan. In the preamble, we affirm three convictions: the first is that there is no creation of sustainable value without sharing. It is a very strong and apolitical conviction. The second conviction is that there is no economic dynamism without the vitality of the territories. The growth model must be reconciled with the need to ensure the vitality of the territories. And finally, there is no sustainable economic development without respecting planetary limits.

What matters is not just tackling “green” issues, but having a global “just transition” approach. This is not a La Banque Postale slogan. This concept designates everything that contributes to building a better world by taking into account ecological, social, territorial and digital transformation. The idea is to have a holistic vision of all these necessary transformations in society and to support them. If we had to sum up our raison d'être in one sentence, it would be the bank that wants to promote the just transition.

Why have a purpose today? What will this change for La Banque Postale, created 15 years ago to provide basic banking services to all?

P. H - La Banque Postale is “citizen by design” because it was built for that. It is written in its statutes and in the speech of Patrick Werner, former president of La Banque Postale. But, 15 years after our creation, it was important for us to consolidate our citizen base and reaffirm our leadership by projecting ourselves into the future in a field where we are very legitimate and internationally recognized as the first impact bank. We are ahead of the banking community. It is important for us to strengthen this positioning and reaffirm what we are, the citizen bank.

In concrete terms, how will this purpose be embodied?

P. H - We first implement a series of actions in favor of our customers. For example, we are launching the first impact consumer credit, a world first on the market. Very concretely, if you buy an electric or hybrid car, the rate applied will be increased. And, if you buy a thermal car, La Banque Postale undertakes to offset the carbon emissions of this car for the two years following the financing of the vehicle. We are also going to offer impact financial products, by donating part of the fund management fees to associations.

We are also going to implement on our online banking application a feature developed by the start-up Carbo, incubated within platform58 (structure dedicated to supporting fintech and insurtech start-ups, editor's note). It measures the carbon impact of our daily consumption, such as refueling, booking plane tickets or simply our purchases in stores.

And we are also going to fundamentally transform our banking model. We are in the process of deploying a founding tool: a global impact index. Alongside the elements of risk and return measurement studied during a credit or investment committee, we will incorporate a measurement of environmental, territorial and social impacts. This scoring will be one of the decision-making elements. It is a proprietary index, but one that we are developing in open architecture. We worked with WWF to accredit and certify the relevance of the tool. We aim to develop this methodology with all stakeholders who would like to join us (academics, NGOs, etc.). And we call for it to be done in co-construction with other financial players.

Beyond your raison d'être, you announce that you want to become a company with a mission by the end of the year. Why would you want to go a step further?

P. H - We are one of the first banks to take this path. We are inspired by our parent company, which became a company with a mission at the beginning of June. We are also ranked first in the world bank on CSR by certain extra-financial rating agencies and we wish to continue our approach by becoming a company with a mission. A monitoring committee will be set up which, alongside the supervisory board, will use the raison d'être as a strategic filter in the choice of investments, and in the choices of external growth. All this is opposable and commits us, that is to say that if we do not respect its raison d'être, we can lose it by decision of the judge. In addition, external certifying bodies will come to verify that we are respecting the commitments made.

The idea for us is to show that there is no complacency in this approach. We do it out of conviction. The best way for this to be credible is to make this process measurable and transparent. We can only improve what we measure. For us, it's a way of asserting our high standards and taking a step ahead where there is sometimes some confusion between what comes from communication and what comes from action.

Few companies in the banking sector have made this choice and it seems to me that it is a very structuring discipline for asserting our leadership in positive impact finance at the international level. Our ambition is to have a level of commitment and transparency that is undoubtedly unequaled in the market. We want to draw, not in the sand, but in the marble, a dividing line between those for whom it is an argument of circumstance and those for whom it is really in the DNA.

La Banque Postale's DNA, in the spirit of the 2005 law, is to be a “different” bank with general interest missions. For what reasons does this notion of general interest not appear in the purpose of the bank?

P. H - La Banque Postale is a bank with public capital, a subsidiary of the La Poste group. As such, it assumes public service missions, in particular that of banking accessibility, enshrined in law and about to be reconfirmed by the European Commission. The defense of the general interest is a concept that evolves over time. And, in a way, the general interest is part of our raison d'être, with different words and commitments. We are giving more precise content to this notion even though the general interest is now plural, with the urgency of the climate, the urgency of territorial balances and the urgency of social cohesion. But make no mistake, we are not an NGO but a commercial bank operating in a formidable competitive environment.

Is this citizen anchoring that you claim compatible with an ambitious growth strategy?

P. H - We have decided to be France's favorite bank in 2025. This is the objective of our strategic plan and it is indeed very ambitious. How to achieve it? First of all on the quality of services. We were in this area at the top of the podium but we lost ground today. New banking standards have appeared, in particular with the neo-banks which have imposed a new type of relationship based on immediacy and convenience. We feel like we can get back to the podium quickly.

Secondly, our civic vocation will undoubtedly make the difference. It is clearly a pillar of our strategy. Finally, it is the postal workers who are the actors of this just transition. Postal workers are more and more often the last ramparts against the desertification of territories or certain urban areas. They play a key role in maintaining the proximity and accessibility of banking services. Last, but important, is our desire to ensure that our efforts in terms of digitization benefit both our customers in the consumption of banking services and our employees in their work.

What will be the future of your network at a time when the reduction in the number of bank branches becomes the rule in the sector?

P. H - Our assumed positioning, it is true, goes against the choices of the sector: that of maintaining strong proximity. The retail banking sector in France is however in great pain and all the major banking networks are being restructured, with an acceleration of the reduction in the number of branches, which are increasingly deserted by customers. This poses real strategic dilemmas. How to maintain a physical relationship or defend a relational model with a few agencies in a department? The sector is close to a breaking point. Still, the agency is the main vehicle for acquiring new clients.

At La Banque Postale, we rely on our 17,000 contact points, including 7,600 post offices, and regional planning is one of La Poste's public service missions. It is a differentiating element and a guarantee for us to maintain the link. Post offices are also an extraordinary catchment area, with one million visits per day whereas, in a traditional bank branch, this amounts to between 10 and 20 visits per day. Post offices are places of polarization in extremely strong territories and offer us opportunities for growth.

La Banque Postale is regularly cited in asset and bank repossession files. Is external growth a priority for you?

P. H - We have the means for our development, in particular a CET1 capital ratio of more than 20%. We already have some 20 million customers, of which 12 million are very active. The priority is therefore to reactivate inactive accounts. This is a huge development potential. Nearly one in three French people is a customer of La Banque Postale.

But we are also convinced that the retail banking model will be permanently challenged by low interest rates and weak market growth. It is therefore essential to accelerate the diversification of our activities, whether in insurance, with our subsidiary CNP Assurances, or consumer credit, leasing, factoring as well as asset management or the companies. This is the reason why we look at most niche files. But we are also very disciplined and we avoid embarking on industrial or financial adventures. We naturally need meaning, and that these projects are consistent with our raison d'être.

9 mins

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