According to the latest figures available, the amount of new home loans is at its lowest in France, with 6.7 billion euros in March, the lowest volume in 10 years. Rates have fallen, below the somewhat symbolic rate of 4%. We can expect a rate cut on June 6, but we won’t come back “at the rate of 1 or 1.5% that we experienced a few years ago”, according to Daniel Baal. Not imagining the price of real estate falling either, he advises moving away from a wait-and-see attitude. “When you have a project, it is better to talk to your bank about it, and the bank will undoubtedly do what is necessary to provide the expected support,” he assures.
Arriving at the head of Crédit Mutuel in April 2024, Daniel Baal is a president with a somewhat atypical profile for a bank boss. He didn’t go to high school but, with a BTS in his pocket, he climbed all the ranks within the bank. He even put his professional career on hold for several years to direct the French Cycling Federation, because cycling is his other passion.
franceinfo : Do you feel like you stand out in the world of banking, or are you ultimately a boss like any other?
Daniel Baal: I actually started at the bottom of the ladder and I am very proud to have achieved this journey. But at the same time, Crédit Mutuel is a somewhat atypical bank. This is not a standard bank. From there, all routes are possible. And even today, when I see young people hired, I tell them: ‘you can continue to progress, you must even do everything to progress’. Our company, which is very attached to the field, proximity and training, allowed me to pursue a career within it. In addition, we are still often in contact with our elected mutual members who are present in the Crédit Mutuel banks. And all this creates a favorable climate for evolving.
You have a four-year mandate, with a strategic plan that plans to gain 1 million additional members and customers, to reach a total of 15 million. It’s very ambitious. How are you going to go about it?
This figure of 15 million is what we want to achieve across our entire network, but also through our subsidiary, the CIC. Quite simply, in some regions we are not yet strongly present. If in the east of France, we sometimes have market shares of more than 50% and we are very proud of it, in others, and particularly in the south of France, we still have room for improvement. How can we continue to gain members and customers? Quite simply through relationships, the quality of the relationship.
Should the network also be increased?
No, because we are already very present. We are number one in customer relations for the 12th time this year. This shows the importance we attach to the relationship, and the more importance we attach to the quality of the relationship, the more we have a good promotion score and consequently, we can win over new members and new customers.
Crédit Mutuel’s historical business is retail banking, and therefore banking for individuals. According to the latest figures available, the amount of new housing loans is at its lowest in France, with 6.7 billion euros in March, the lowest volume since 10 years. Do you also see this at Crédit Mutuel?
I will have a very positive touch. Since mid-April, we have felt a stirring, more requests. It is also linked to the fact that rates have fallen, we have fallen below the somewhat symbolic rate of 4%. Today, it is not the supply of credit that is lacking, it is the demand, linked to a real estate market which is still relatively sluggish today.
Do you have the impression that individuals are waiting for another rate cut? The ECB is expected to cut rates again in the spring.
A rate cut is expected on June 6. I think that rather the French are waiting for a drop in prices, and I fear that this drop in prices will not really come.
“When it comes to lowering rates, we should have no illusions, we will not return to the rate of 1 or 1.5% that we experienced a few years ago.”
Daniel Baalat franceinfo
Going back below 4% is already competitive. Let’s not forget that ten or fifteen years ago, rates were around 8-9%.
Do you think real estate prices will not fall?
You know, we have a simple problem, it is that we expect a drop in prices in old buildings. This means that there should be a correlation with new prices. However, how can the prices of new buildings fall when the prices of materials and labor have increased? It’s impossible. So if I have any advice to give, let’s not wait and see. When you have a project, it is better to talk to your bank about it, and the bank will undoubtedly do what is necessary to provide the expected support.
The bank is always a good thermometer of the economy. We have just talked about loans to individuals. What about business loans?
We still feel a certain wait-and-see attitude among business leaders. For several reasons, rates, the economy. The President of the Republic announced a much better second half of 2024. I believe he is right, because today, a certain number of indicators allow us to consider it. So, here too, the recovery can occur by the end of the year. But on the rate, I say the same thing, let’s not expect a dizzying drop.
And do you also see business failures? Do you see more?
Yes, we are seeing more business failures today than we did a year or two ago. During the period after the health crisis, many companies lived with fairly artificial support. Today, we are returning to an almost normal situation. There is one sector which is suffering more than the others, it is the real estate sector, in connection with the slowdown of this market. Otherwise, I cannot say that the situation today is worrying. Throughout my career as a bank operator, we have always known companies which, at one time or another, encountered difficulties. It still exists today, but it’s not a phenomenon that we consider really profound. I think a little bit of stimulus will allow all this to start again.
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